Vimpelcom’s regional operations beat expectations for Q1

30 May 2003

Russia’s second largest mobile operator Vimpelcom has reported a net profit of USD41.39 million for the first quarter of 2003, up from USD39.08 million the previous quarter. The 28% rise has beaten analyst expectations for the quarter, with the cellco’s regional operations outside Moscow reporting their first profit since 1999. Vimpelcom reported total revenues of USD244.44 million, up from USD228.98 million, while the EBITDA margin rebounded to 44.2% after hitting a low of 37% the previous quarter. Revenue growth for the quarter stood at 68% and the operator said it is expecting to see further revenue growth of 45%-50% in 2003. Despite its recent success, Vimpelcom has expressed concern over how little revenue is elicited from new clients, with new customers signing up to its regional operations, which generate lower average revenues per user (ARPU) than its metropolitan operations. Monthly ARPU stood at USD13.5 in the first quarter, down from USD16 in the fourth quarter of 2002.