The company generated Rub 2.4 bn in gross revenues in 2001, which represents a 17 percent increase year-on-year.  Growth in overall revenues is mainly attributable to gains posted in the company's cellular communication business.  Thanks to an increase of 48,000 in its subscriber base, Uralsvyazinform was able to boost cellular earnings to Rub 252.2 mn (up 70.4 percent year-on-year).  An increase in the number of local telephone subscribers and the 20% tariff hike effective March 1, 2001 on local telephone service generated an additional Rub 94.9 mn (up 19.1 percent compared to the year-earlier period).  

The company's earnings breakdown for 2001 can thus be summarized as follows:  

Long-distance and international telephone services - 33.7 percent (42.6 percent in 2000);

Local telephone services 33.4 percent (30.3 percent in 2000);

Mobile phone and paging - 28.3 percent (21 percent in 2000;

Radio and TV broadcasting 3.2 percent (3.9 percent in 2000)

Internet and data transmission- 1.4 percent (1.4 percent (2.2 percent in 2000) 

Operating expenses increased by 12.1 percent in 2001 and stood at Rub 1.9 bn.  The growth in expenses is linked to a rise in amortization deductions (up 24.2 percent), payroll costs and social security deductions (up 20.8 percent).  

Since earnings outstripped expenses the company's operating profit jumped 42.2 percent, pre-tax-profit  surged 68.8 percent and EBITDA jumped 19.6 percent. 

The company's net profit for 2001 stood at Rub 308.1 mn, which represents a 60.2 percent drop year-on-year. The main reason for this decline was the decrease in assets due to deferred taxation, which in turn reflects the lower profits tax rate.  

The company's operating cash flow increased by 90 percent in 2001 and stood at Rub 418.5 mn.  

Uralsvyazinform's financed capital investments for 2001 reached Rub 703.6 mn (up 105.7 percent).  Credits and loans received totaled Rub 2.04 mn (up 33.6 percent).  As for payables, the company paid off Rub 1.7 mn of credits and loans in 2001.  

The company's net cash flow in 2001 was Rub 43.7 mn compared to the negative value (Rub - 177.5 mn) in posted in the year-earlier period. 

The company's books were audited by Ernst & Young Vneshaudit ZAO in 2001 in accordance with IAS. ZAO Arthur Andersen was chosen as Uralsvyazinform's official international auditor at a general shareholders meeting for 2000.  However, Arthur Andersen was in the process of merging with Ernst & YoungCIS Ltd. in March 2002, which is the reason why these financial statements were delayed.  

The full version of Uralsvyazinform's IAS financial statements have been posted on the company's'

corporate website and can be viewed at www.uralsvyazinform.ru