State-run Svyazinvest, one of Russia’s largest telecoms groups, said its 2004 consolidated net profit fell by 10.4% year-on-year to RUB17.5billion (USD630 million), despite a significant rise in its revenues. Turnover grew 22.8% to RUB186 billion, but was counteracted by a 26% hike in expenditure and a 27.6% rise in capital costs. Svyazinvest’s results include the businesses of all seven of Russia’s ‘mega-regional’ operators: Center Telecom, North-West Telecom, Volga Telecom, South Telecom, Uralsvyazinform, Siberia Telecom (Sibirtelecom) and Far East Telecom (Dalnevostochnaya). It also has minority stakes in Moscow Local Telephone Network (MGTS), Svyaz Komi Republic, Ruslizinsvyaz and Kostroma GTS, as well as interest in the country’s national long-distance and international monopoly operator Rostelecom. A proposal outlining the long awaited sale of the state’s 75% holding in Svyazinvest is currently working its way through government.