Uralsvyazinform’s IAS revenues at the end of 2002 totaled RUR17,7 bln ($564,5 mln*). IAS revenues are 19,6% higher than these under Russian Accounting Standards (RAS) being reflective of consolidation of company’s subsidiaries.
The share of fixed-line services in the revenues’ structure was 76,5 %, mobile services - 20,9 %, other revenues – 2,6 %. Services supplied to business clients provided 45,8% of the revenues.
Operating expenses in 2002 totaled RUR14,8 bln ($472,1 mln) which is 35,4% higher as compared to these under RAS. This mainly reflects the 64,4% rise in depreciation and amortization expenses as compared to similar items under RAS after appropriate adjustments were made to the value of fixed assets under IAS. In addition, IAS and RAS account differently the way operating expenses relating to wages, social benefits, materials and maintenance should be calculated.
The operating profit amounted to RUR2,9 bln ($92,4 mln) (which is 25,0 % less than this under RAS), however earnings before income tax, deprecation and amortization (EBITDA) is equivalent to the similar indicator under RAS and totals RUR5,3 bln ($169,0 mln).
67,9% of segment result comes from the fixed-line services, 31,2% - mobile services and 0,9% - other services.
The interest payments and similar expenses to a large extent were offset by net monetary gain, as a result of which the profit before tax was obtained at the rate of RUR2,0 bln ($64,8 mln) in 2002, or 47,4% up against the similar figure under RAS.
Net profit as of 2002 equaled RUR1,2 bln ($37,0 mln) (27,6% higher than the net profit in compliance with RAS), net margin – 6,6 %.
In 2002 Uralsvyazinform made substantial investments in extension and renovation of its fixed-line networks, the increase of capacity and coverage of mobile telephony, along with development of new services – IP-telephony, Internet and broadband access based on optical multiservice network. The overall CAPEX in 2002 amounted to RUR4,0 bln ($127,9 mln)
The major acquisition in 2002 was RUR 0,5 bln worth ($15,3 mln) additional share holding to increase the company’s stake up to 100% in South-Urals Cellular Phone, a GSM900/1800 operator servicing Chelyabinsk and Kurgan regions that had 314,7 thousand subscribers as of Sept. 1, 2003.
In 2002 the company had a positive net cash flows of RUR0,056 bln ($1,8 mln).
Full version of 2002 IAS consolidated financial statements of Uralsvyazinform with commentary may be found on the company’s corporate web-site in Financials section.
*Note: currency conversions are based on average annual (2002) exchange rate of US dollar at 31,35 rubles per 1 US dollar.