RBC reaffirms its 2005 outlook (excluding anticipated acquisitions): total revenue is expected to reach $98.0m, consolidated EBITDA $29.4m, and consolidated net profit $22.0m.
Revenue for the 1st quarter 2005
| $'000 |
1st quarter 1 |
1st quarter 2004 1 |
Growth (%) |
Forecast 2005 |
| Media services |
8 700 |
6 800 |
28 |
42 500 |
| RBC TV |
4 800 |
3 500 |
37 |
25 000 |
| IT Services |
5 950 |
4 600 |
29 |
30 500 |
| Total revenue |
19 450 |
14 900 |
31 |
98 000 |
1 Figures calculated on the basis of management accounts in accordance with IFRS (unaudited)
Moscow, May 24, 2005 - Reviewing preliminary financial results for the 1st quarter 2005 published by RBC Information Systems (RTS, MICEX: RBCI) today, RBC Chairman and CEO German Kaplun said: "We had an excellent start in 2005. All of our businesses posted solid growth and continued to demonstrate industry leadership, supported by a favorable macroeconomic situation. We are especially satisfied with the performance of our television station RBC TV, which is making rapid progress and becomes a significant contributor to our revenue. The continued robust growth we have achieved enables us to launch new projects and make attractive acquisitions in order to keep RBC positioned as one of the fastest-growing Russian companies in the media and IT fields throughout 2005 and beyond."
Revenue. In the first quarter, impressive total revenue growth of 31% from $14.9 million in 2004 to $19.5 million in 2005 was driven by strong brand recognition of the company as a media and IT service provider among the business community, efficient marketing and favorable macroeconomic conditions. In the total 1Q2005 revenue mix, 45% came from the underlying media business (online advertising, marketing communications, and information services), 25% was contributed by RBC TV, and 30% by the IT business (general and offshore programming, and system integration).
Media Services. RBC's media revenue (excluding the TV channel) was up 28% from $6.8 million in the first quarter of 2004 to $8.7 million in the same period of 2005. The development of new web properties and a focus on target high-income and specialized audiences enhances RBC's ability to capitalize on the spectacular growth of the online advertising segment in Russia. In the area of information services, the company launched a QuoteRate terminal with a wide array of information on currency, debt and stock markets, introduced a customizable news line RBC NewsMonitor and added several new sections to its news web sites. In March 2005, the marketing communication branch held a highly successful international business conference dedicated to Russian and Ukrainian economic prospects, with prominent speakers and over 240 delegates attending, and in February 2005, awarded the winners of the Person of the Year annual business award program.
RBC TV. The television station reported top-line growth of 37% from $3.5 million in the first quarter of 2004 to $4.8 million in the same period of 2005, thanks to strong content and high demand for efficient advertising to high-profile target audiences. The client base among banks and financial organizations, construction and real estate firms, car manufacturers and hi-tech companies is constantly growing, with two thirds of them becoming the channel's repeat customers.
In February 2005, RBC TV began production of a weekly program 'Business Russia' for CNBC Europe to give the Western business community a regular update on Russian markets and corporate development trends. In the opinion of the company, the fact that CNN and CNBC Europe broadcast RBC TV's programs is recognition of the channel's expertise in reporting quality business news.
The channel is actively enhancing its distribution in cities, whose coverage is strategically important for reaching the target audience. For example, RBC TV's penetration has already reached 60% of St. Petersburg with the help of a major local cable provider, television company St. Petersburg Cable Networks, and will further grow to about 75% of the city by the end of this year. The company is also making progress in talks aimed at expanding its Moscow coverage, which is expected to be a significant growth driver for its TV advertising revenue.
IT Services. RBC's revenue from IT Services climbed 29% from $4.6 million in the first quarter of 2004 to $6.0 million in the reported period, driven by a well-balanced product portfolio, aggressive marketing, a good track record in accomplishing complex projects, and consistent IT spending by state agencies and large domestic corporations. Among major tenders won in the first quarter was the provision of equipment and software for Russia-supported distance learning centers in the CIS ordered by the Russian Education Agency and the deployment of one of Russia's largest distance learning systems for the Federal State Statistics Service.
ADR program. RBC established a Level-1 ADR program (ticker symbol: RINFY, CUSIP number: 75523Q102) for its common stock on March 24, 2005. One ADR represents four ordinary shares. ADRs are tradable on the OTC market. The main goal of the issuance is to enable international retail and institutional investors to participate in the share capital of RBC.
Outlook for 2005 (excluding anticipated acquisitions). RBC reaffirms its outlook for 2005 and expects dynamic business expansion to continue based on existing contracts, successful performance of RBC's key brands and new product launches. Total revenue is projected to reach a new record level of at least $98.0 million, consisting of $42.5 million from the underlying media business, $25.0 million from RBC TV, and $30.5 million from IT services. Consolidated EBITDA will be $29.4 million, and consolidated net profit will hit $22.0 million in 2005, including $2.0 million from RBC TV.
Cautionary note regarding forward-looking statements
Some of the information in this press release may contain statements of future expectations and other forward-looking statements. These expectations are based on the management's current views and assumptions, and involve known and unknown risks and uncertainties. It is possible that the company's actual results and financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these forward-looking statements. For a discussion of some of the risks and important factors that could affect the firm's future results, see "Risk Factors" in the company's latest Annual Report on www.rbcinfosystems.com. RBC assumes no obligation to update any forward-looking information contained in this document.
Investor contact: Natalia Makeeva
Tel: +7 (095) 363-1111 (ext. 1369), e-mail: ir@rbc.ru, Web: www.rbcinfosystems.com.
