Rostelecom 2002 nine months results in accordance with Russian Accounting Standards

• As per preliminarily data during the first nine months of 2002 domestic long-distance traffic volume grew by 17%, international outgoing — by 11% compared to the same period a year ago;
• Revenue* was up 6.2%**, reaching RUR 15,184.06 mn;
• Growth in operating profit was 43% over a year ago, with operating profit amounting to RUR 6,120.3 mn;
• Net profit amounted to RUR 4,900.8 mn, almost threefold higher than in the first nine months of 2001.

As per preliminarily data, domestic long-distance traffic was up 17% versus first nine months of 2001, reaching 5,102 million minutes. Growth in DLD revenues was 38.3% over a year ago. DLD revenues reached RUR 6,346.9 mn.

As per preliminarily data, growth in international outgoing traffic was 11% with traffic reaching 928 million minutes. Rostelecom outgoing ILD revenues remained almost unchanged compared to the same period a year ago totaling RUR 5,959 mn.

Total revenue reached RUR 15,184.06 mn, which is 6.2% higher than for the same period last year.

Operating costs during the first nine months of 2002 declined by 9.5%, amounting to RUR 9,063.7 mn. Depreciation decreased by 19.5% to RUR 3,717.8 mn, EBITDA increased by 10.6%.

Operating profit surged by 43% to RUR 6,120.3 mn.

Growth in other operating revenues by 150% is explained mostly by profit from Sovintel deal in the amount of RUR 3,025.6 mn. Other operating expenses increased by 49% to a large extent due to bad debt expense of over RUR 600 mn.

Net profit increased by 173% to RUR 4,900.8 mn. Disregarding the effect from Sovintel transaction and bad debt expense, net profit would be RUR 2,996.4 mn or 67% higher than a year ago.

Rostelecom Headquarters Address: 14, 1st Tverskaya-Yamskaya street, Moscow, 125047, Russia

Phone: +7 (095) 972–82–83 Fax: (095) 787–28–50