The formal stage of the Urals mega-regional telecom merger was completed on September 30.  Six regional companies were merged to Per region operator OJSC Uralsvyazinform.

The company's preliminary results compiled for the first nine months of 2002 were based on the results of activity by six merged entities - OJSC Svyazinform Chelyabinsk region, OJSC Uraltelecom, OJSC Tyumentelecom, OJSC Khantymansiisokrtelecom, OJSC Yamalelektrosvyaz, OJSC Elektrosvyaz Kurgan region and OJSC Uralsvyazinform Perm region.

The total number of fixed lines held by the merged company as of January 10, 2002 stood at 3,134,100, including 2,760,800 urban telephone lines and 373,300 rural telephone lines.

The number of lines entered into service by the merger company as of October 1, 2002 was 2,869,7000.  The ratio of lines entered into service was 92.4 percent.

International traffic processed by the merged company for the first nine months of 2002 rose by 25.4 percent, compared to the same period last year and stood at 1,075,600 minutes.  International traffic for nine months stood at 78.5 million minutes (up 16.3 percent).

Mobile business of the merged company was generated by own production (cellular communications using the GSM 900, NMT 450 and CDMA standards) and five subsidiaries which provide cellular communications services - ZAO Yermak RMS, OOO South Urals cellular telephone, ZAO TyumenRuskom, ZAO UralWestcom and ZAO Kurgan cellular telephone.

The merged company's share in the subsidiary cellular business and the subscriber structure are shown in the table below:

The average number of staff employed at the merged company as of October 2002 was 25,743.  As a result of this, downsizing measures were enacted to make staff performance more efficient, whereby the average number of staff decreased by 1,782 (5.0 percent) compared to the number of staff of record as of January 1, 2001.

According to preliminary data, the aggregate revenue generated by Uralsvyazinform for the first 9 months of 2002 was rub 10,550,500, which represents a 39.9 percent increase for this index pear on year.

The structure of revenue in the various segments looks as follows: long-distance/international traffic - 49 percent, city telephone traffic - 31 percent, cellular traffic - 10 percent, rural telephone traffic - 3 percent, ISP/telegraph - 2 percent, other services (value-added, TV and radio broadcasting) - 5 percent).

Expenses for the first nine months of 2002 stood at rub 7,939,000.

The company's revenue growth was up 81 percent compared to the same period last year, and based on preliminary data sales revenue reached rub 2,611,400 in the first nine months of 2002.

The volume of capital investments for the merged company during first nine months of 2002 stood at rub 2,025,000.

Those who would like to obtain additional information can call (3422) 905-863 or e-mail investor@usi.ru