OJSC «North-West Telecom» has summarized the results of its activities for 2002 taking into account the figures (for 12 months of 2002) concerning organizations, which amalgamated the OJSC «North-West Telecom» on 01.11.2002.

Installed network capacity in 2002 amounted to 3,612 thousand numbers; operating capacity 3,399 thousand numbers. In 2002, network digitization as compared to 2001, increased from 35.93% to 39.02% in the City Telephone Network; in the Rural Telephone Network, from 7.76% to 8.46% of total installed capacity. Increase in the number of primary telephone sets in 2002 was 141.7 thousand numbers. Outcoming long-distance traffic increased by 15.8% as compared to 2001, amounting to 1,063,995 thousand minutes, which is 2.26% more than the scheduled volume. Outcoming international traffic increased by 13.7% as compared to 2001 amounting to 145,273 thousand minutes exceeding the planned volume by 2.33%.

Sales proceeds of OJSC «North-West Telecom» reached 10,091,841 thousand roubles, which is 2,033,110 thousand roubles more than in 2001. Proceeds from sales of telecommunication services amounted to 9,778,167 thousand roubles, which is 1,940,072 thousand roubles more than for a similar period of the previous year. Prime cost of the telecommunication services sold is 7,300,095 thousand roubles.

Net profit of OJSC «North-West Telecom» reached 327,264 thousand roubles. Lower net profit figures as compared to a similar period of the previous year are due to forming a provision against doubtful debts in the amount of 663,403 thousand roubles (as of 31.12.02.) A provision against doubtful receivables is formed by the Company in the full amount of receivables with the incurrence period exceeding 90 days.

According to the Deputy General Director – Finance of the OJSC «North-West Telecom»   Shalagin A.V., to format a provision   is common practice for other countries, which notably increases the reliability of the Company’s financial records.