MTS reports loss in 1Q 2009

26 May 2009

Russia’s leading mobile operator Mobile TeleSystems (MTS) has reported a net loss of USD57.7 million in the three months ending 31 March 2009, down USD667.9 million on the same period a year earlier. Consolidated group revenues were down 24% year-on-year to USD1.8 billion and operating income fell by 34% to USD464.2 million, down from USD704.6 in 1Q 2008. The operator largely attributed losses to foreign currency fluctuations. Mikhail Shamolin, President and CEO, said, ‘In spite of the volatile macroeconomic situation in Russia, MTS demonstrated year-on-year revenue growth in national currencies in all of its markets of operation with the exception of Ukraine, where growth dynamics were in line with the market’s overall performance. The changes in the foreign exchange rates impacted our USD-denominated results and led to a decline in the company’s main USD-based financial indicators, however, the stable financial position of MTS allows us to continue to execute on our business development strategy.’ The company added 950,000 net new customers in the quarter, with 96.61 million subscribers across its operations at the end of March 2009.

Meanwhile, MTS has applied for anti-monopoly office approval to buy up to 100% of fixed line operator Comstar United Telesystems, Reuters reports. Both companies are owned by Sistema Group and are considering merging into one universal telecoms service provider.