Moscow, Russia – 9 December, 2009 – Sistema (the “Group”) (LSE: SSA), the largest diversified public financial corporation in Russia and the CIS, which invests in and is a major shareholder of companies operating in different industries, today announced its unaudited consolidated US GAAP financial results for the third quarter ended September 30, 2009.
Third quarter highlights
- Consolidated revenues up 21.0% year on year and 25.6% quarter on quarter to US$ 5.3 billion
- Consolidated OIBDA nearly doubled year on year and almost tripled quarter on quarter to US$ 3.2 billion with OIBDA margin of 59.5%
- Consolidated net income attributable to the Group increased by nearly 16 times year on year to US$ 1.7 billion
- The Oil & Energy business unit contributed US$ 1.9 billion and US$ 2.5 billion to the Group’s consolidated revenues and OIBDA respectively
Key corporate highlights in the third quarter
- In September 2009, ANK Bashneft and Shell signed an agreement to supply West Siberian oil to Ufa oil refineries
- In September, MTS secured additional financing from Sberbank through two loans in the amount of RUB 47 billion and RUB 12 billion
- In August 2009, ANK Bashneft signed a cooperation agreement with LUKOIL and TNK-BP to supply crude oil to Ufa oil refineries
- In August 2009, MBRD placed RUB 2.2 billion (approximately US$ 75 million) asset-backed securities
- In August 2009, Sistema placed a RUB 20 billion second series five-year bond with a put option exercisable in three years, with an annual coupon rate set at 14.75%
- In July 2009, Sistema obtained a EUR 120 million 3-year loan from the EBRD and also bought back from the EBRD its minority stake in SITRONICS
Leonid Melamed, President and Chief Executive Officer of Sistema, commented: “During the third quarter Sistema has consistently executed on its strategy, focused on the growth of shareholder value and the increase of return on invested capital. We achieved considerable growth in consolidated revenues and OIBDA and generated a marked improvement in the results of the Bashkir oil business. Furthermore, our debt to OIBDA ratio declined to 2.4 which demonstrated the effectiveness of management’s efforts aimed at improving our financial position. We are focused on further increasing our asset values.
Among our key initiatives was the approval by the Board of Directors of Sistema of an updated development strategy for the Indian telecommunications project; the signing up of a strategic partner, VTB Bank, as a majority shareholder in Sistema-Hals, following the execution of its call option to buy 31.5% of the company. We have initiated the process of optimisation of the corporate structure in Bashkirian assets, which is aimed at creating a vertically-integrated company. We expect that the integration of our telecommunications assets will create new large-scale opportunities for MTS and Comstar and enhance the value of the combined entity. We have continued with our efforts focused on the creation of partnerships with the State and in this regard we signed an agreement with Rosnano to build a 90 nm microchip production plant.
We expect that all these initiatives will enable us to unlock the full value and growth potential of our assets in the future.”
Conference call information
Sistema management will host a conference call today at 9 am (New York time) / 2 pm (London time) / 3 pm (CET) / 5 pm (Moscow Time) to present and discuss the third quarter results.
The dial-in numbers for the conference call are:
UK/International: + 44 20 7190 1596
US: +1 480 629 9774
A replay of the conference call will be available on the Company’s website www.sistema.com 7 days after the event.