On March 26, 2004, Fitch Ratings Agency went public with its decision to upgrade the long-term foreign currency credit rating of Uralsvyazinform from B+ to BB-, Stable Outlook, but left its B short-term foreign currency credit rating unchanged.

The rating reflects the company’s leadership position on the fixed-line and mobile telecommunication services market in the Urals region. Fitch has pointed out consistent improvements in Uralsvyazinform’ financial performance and expects the company to show even better results on the back of soaring LD and local tariffs, providing value-added services and winning new cellular subscribers. Fitch also noted that the telecom operator obtained a license to provide cellular services in GSM 900/1800 standard in the Sverdlovskregion and Ekaterinburg. This will help the company retain a leadership position on the cellular market throughout the Urals region.

Upon successful implementation of a large-scale investment program aimed at developing the telecom sector in the Urals region, Fitch expects that the company’s mid-term and long-term net cash flows will end up in the black.

For more information on Uralsvyazinform’ rating upgrade, visit the web site of Fitch Ratings at www.fitchratings.com.