VimpelCom Announces Third Quarter 2009 Financial and Operating Results
Third Quarter 2009 Highlights and Recent Developments
Operational
-- Mobile subscribers increased by 1.7 million versus 2Q09, reaching 65.4 million
-- Successful launch of operations in Vietnam under Beeline brand
-- Agreement signed to enter Laos mobile market
-- 3G presence in all regions of Russia as of November 21, 2009 Financial
-- Net operating revenues reached 71.3 billion Russian rubles, an increase of 3.3% versus 2Q09
-- OIBDA reached a record 36.0 billion rubles, an increase of 2.9% versus 2Q09
-- Continued strong consolidated fixed and mobile OIBDA margin of 50.4%
-- Net income attributable to VimpelCom amounted to 13.5 billion rubles
Other
-- Interim dividend payment of 190.13 rubles per common share proposed by the Board of Directors
-- Major shareholders agreed to combine their stakes in VimpelCom and Kyivstar in a new company
Commenting on the performance of the Company, Boris Nemsic, Chief Executive Officer of VimpelCom, said, "During the third quarter we continued to demonstrate growth in challenging market conditions and delivered a record 71.3 billion rubles in revenues and 36.0 billion rubles in OIBDA with a consolidated fixed and mobile OIBDA margin of 50.4%.
We are particularly pleased with the OIBDA performance which demonstrates our ability to increase revenues and control costs in the new economic environment.
The number of active mobile subscribers reached 65.4 million, which is 13% more than we had a year ago. We serve 1.9 million fixed and mobile broadband subscribers, which makes us one of the largest broadband providers in Russia and the CIS.
Stable operational cash flow strengthened our financial position. As of today, we have repaid more than $2 billion dollars of our debt and fully funded capital expenditures. We continue to optimize our debt portfolio with the non-ruble portion of our debt decreasing to 76% of our total debt, compared with 85% at the beginning of the year.
On October 5th, 2009, Altimo and Telenor agreed to combine their interests in VimpelCom and Kyivstar, paving the way for the creation of one of the largest telecom operators in the emerging markets. Management of VimpelCom welcomes this transaction and believes that the transaction, when completed, will bring benefits to our shareholders, employees and customers."
Key Consolidated Financial and Operating Results*
CONSOLIDATED OPERATIONS*
(RUR, millions)__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o-q
------------------------ ------ ------ ----- ------ -----
Net operating revenues__ 71,338__ 68,933__ 3.5%__ 69,035__ 3.3%
---------------------- ------ ------ --- ------ ---
OIBDA__ 35,980__ 33,636__ 7.0%__ 34,958__ 2.9%
----- ------ ------ --- ------ ---
OIBDA margin, %__ 50.4%__ 48.8%__ 50.6%
--------------- ---- ---- ----
Operating income__ 22,299__ 21,568__ 3.4%__ 22,250__ 0.2%
---------------- ------ ------ --- ------ ---
Operating income margin, %__ 31.3%__ 31.3%__ 32.2%
-------------------------- ---- ---- ----
SG&A__ 18,760__ 18,167__ 3.3%__ 18,458__ 1.6%
---- ------ ------ --- ------ ---
including Sales &
Marketing Expenses__ 5,766__ 5,867__ -1.7%__ 5,414__ 6.5%
------------------- ----- ----- ---- ----- ---
including General &
Administrative Costs__ 12,994__ 12,300__ 5.6%__ 13,044__ -0.4%
--------------------- ------ ------ --- ------ ----
SG&A percentage__ 26.3%__ 26.4%__ 26.7%
--------------- ---- ---- ----
Net income attributable to
VimpelCom__ 13,513__ 6,513__ 107.5%__ 22,599__ -40.2%
-------------------------- ------ ----- ----- ------ -----
Net income attributable to
VimpelCom per common
share, basic (RUR)__ 266.83__ 128.68__ 446.43
-------------------------- ------ ------ ------
Net income attributable to
VimpelCom per ADS
equivalent, basic (RUR)__ 13.34__ 6.43__ 22.32
-------------------------- ----- ---- -----
Capital expenditures__ 3,842__ 16,799__ -77.1%__ 5,027__ -23.6%
-------------------- ----- ------ ----- ----- -----
Mobile subscribers ('000)__ 65,358__ 57,758__ 13.2%__ 63,676__ 2.6%
------------------------- ------ ------ ---- ------ ---
Broadband subscribers*)
('000)__ 1,930__ 785__ 145.9%__ 1,739__ 11.0%
----------------------- ----- --- ----- ----- ----
* See definitions in Attachment A. Y-o-y stands for 3Q09 vs. 3Q08 comparison while q-o-q stands for 3Q09 vs. 2Q09.
Net operating revenues 3Q '09* Russia__ CIS__ SEA__ Eliminations Total
(RUR, millions)__ ------ --- --- ------------ -----
---------------
Mobile business__ 51,502__ 9,221__ 74__ -138__ 60,659
--------------- ------ ----- --- ---- ------
Fixed business__ 13,583__ 2,167__ 0__ -608__ 15,142
-------------- ------ ----- --- ---- ------
Eliminations__ -3,874__ -312__ 0__ -277__ -4,463
------------ ------ ---- --- ---- ------
Total net operating revenue__ 61,211__ 11,076__ 74__ -1,023__ 71,338
--------------------------- ------ ------ --- ------ ------
* Due to the increasing integration between different parts of our business, we include inter-company transactions in the reported revenues of geographic and business segments and indicate the amount of inter-company eliminations within and between the segments.
The quarterly net operating revenues increased by 3.5% year-on- year and 3.3% as compared with the previous quarter demonstrating the strength of our core business.
Continued focus on operational efficiency helped us to maintain a strong consolidated fixed and mobile OIBDA margin of 50.4%.
We continue to maintain solid operational cash flow, which provides a basis for further investment in the development of our business. We invested 3.8 billion rubles during the third quarter of 2009. Taking into consideration the further strengthening of the Russian ruble, we have recalculated our CAPEX guidance for 2009 and expect CAPEX to be in the range of 10%-12% of our 2009 annual revenue.
During the third quarter we repaid $690 million of debt. Our net debt continued to decline from $6.3 billion at the end of the second quarter down to $5.5 billion at the end of the third quarter.
Our quarterly net income attributable to VimpelCom amounted to 13.5 billion rubles, including a modest 0.7 billion ruble net foreign exchange gain due to the strengthening of the ruble.
Russia - Financial and Operating Results
RUSSIA (RUR, millions)__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o- q
---------------------- ------ ------ ----- ------ -----
Net operating revenues__ 61,211__ 58,816__ 4.1%__ 59,136__ 3.5%
---------------------- ------ ------ --- ------ ---
OIBDA__ 30,951__ 29,457__ 5.1%__ 30,279__ 2.2%
----- ------ ------ --- ------ ---
OIBDA margin, %__ 50.6%__ 50.1%__ 51.2%
--------------- ---- ---- ----
Operating income__ 20,724__ 20,112__ 3.0%__ 20,574__ 0.7%
---------------- ------ ------ --- ------ ---
Operating income margin,
%__ 33.9%__ 34.2%__ 34.8%
------------------------ ---- ---- ----
SG&A__ 15,644__ 15,191__ 3.0%__ 15,417__ 1.5%
---- ------ ------ --- ------ ---
including Sales &
Marketing Expenses__ 4,940__ 4,918__ 0.4%__ 4,726__ 4.5%
------------------- ----- ----- --- ----- ---
including General &
Administrative Costs__ 10,704__ 10,273__ 4.2%__ 10,691__ 0.1%
--------------------- ------ ------ --- ------ ---
SG&A percentage__ 25.6%__ 25.8%__ 26.1%
--------------- ---- ---- ----
Net income attributable
to VimpelCom__ 13,754__ 6,274__ 119.2%__ 21,835__ -37.0%
----------------------- ------ ----- ----- ------ -----
Our quarterly net operating revenues in Russia amounted to 61.2 billion rubles, growing 3.5% quarter-on-quarter. The quarterly net operating revenues in Russia grew 4.1% compared to the exceptionally strong third quarter of 2008, when we reported high revenues from roaming and handset sales.
The total Russia fixed and mobile OIBDA increased 5.1% year-on- year and reached 30.9 billion rubles with a total fixed and mobile OIBDA margin of 50.6%.
In the mobile segment our revenues increased by 4.2% quarter-on- quarter. Slight upward trends in usage coupled with a seasonal increase from roaming led to an increase in ARPU of 2.8%.
Our fixed-line revenues increased by 4.4% quarter-on-quarter. A seasonal decline in the usage by business customers during the summer months was offset by increasing wholesale revenues, which grew by 13.3% quarter-on-quarter. The fixed-line OIBDA margin decreased quarter-on-quarter from 29.6% to 26.4%. As a result the quarterly fixed-line revenues were also impacted by the appreciation of the Russian ruble as part of our contracts in the business segment are denominated in US dollars and Euro.
In the third quarter of 2009 the total number of residential broadband subscribers in Russia, including FTTB and mobile broadband, reached 1.8 million, a 140% increase year-on-year and a 10% increase quarter-on-quarter.
RUSSIA REVENUES (RUR, millions) 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o-q
------------------------------- ------ ------ ----- ------ -----
Net operating revenues__ 61,211__ 58,816__ 4.1%__ 59,136__ 3.5%
---------------------- ------ ------ --- ------ ---
Mobile revenues__ 51,502__ 49,401__ 4.3%__ 49,410__ 4.2%
--------------- ------ ------ --- ------ ---
Fixed revenues__ 13,583__ 10,789__ 25.9%__ 13,007__ 4.4%
-------------- ------ ------ ---- ------ ---
Eliminations__ -3,874__ -1,374__ -3,281
------------ ------ ------ ------
RUSSIA OIBDA DEVELOPMENT*) 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q- o-q
(RUR, millions)__ ------ ------ ----- ------ -----
---------------
OIBDA Total__ 30,951__ 29,457__ 5.1%__ 30,279__ 2.2%
----------- ------ ------ --- ------ ---
Mobile OIBDA__ 27,360__ 26,772__ 2.2%__ 26,427__ 3.5%
------------ ------ ------ --- ------ ---
Fixed OIBDA__ 3,591__ 2,685__ 33.7%__ 3,852__ -6.8%
----------- ----- ----- ---- ----- ----
Total OIBDA margin, %__ 50.6%__ 50.1%__ 51.2%
--------------------- ---- ---- ----
Mobile OIBDA margin, %__ 53.1%__ 54.2%__ 53.5%
---------------------- ---- ---- ----
Fixed OIBDA margin, %__ 26.4%__ 24.9%__ 29.6%
--------------------- ---- ---- ----
RUSSIA OPERATING DEVELOPMENT 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q- o-q
---------------------------- ------ ------ ----- ------ -----
Mobile subscribers ('000)**)__ 51,028__ 45,093__ 13.2%__ 49,971__ 2.1%
---------------------------- ------ ------ ---- ------ ---
MOU, min__ 213.6__ 228.5__ -6.5%__ 211.8__ 0.8%
-------- ----- ----- ---- ----- ---
ARPU mobile, (RUR)__ 331.4__ 368.2__ -10.0%__ 322.5__ 2.8%
------------------ ----- ----- ----- ----- ---
Broadband subscribers ('000)__ 1,833__ 764__ 139.9%__ 1,659__ 10.5%
---------------------------- ----- --- ----- ----- ----
* Please find information on respective operating income amounts in the supplementary file FinancialOperatingQ32009.xls on our website at www.vimpelcom.com/news/qrep.wbp.
** Starting with this quarterly report, we no longer provide information on subscriber market share. This is because different churn policies used by mobile service providers result in reported subscriber market share figures that could be misleading.
CIS - Financial and Operating Results
CIS OPERATIONS (RUR,
millions)__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o-q
-------------------- ------ ------ ----- ------ -----
Net operating revenues__ 11,076__ 10,663__ 3.9%__ 10,668__ 3.8%
---------------------- ------ ------ --- ------ ---
OIBDA__ 5,322__ 4,232__ 25.8%__ 4,908__ 8.4%
----- ----- ----- ---- ----- ---
OIBDA margin, %__ 48.0%__ 39.7%__ 46.0%
--------------- ---- ---- ----
Operating income__ 2,056__ 1,509__ 36.2%__ 1,929__ 6.6%
---------------- ----- ----- ---- ----- ---
Operating income margin,
%__ 18.6%__ 14.2%__ 18.1%
------------------------ ---- ---- ----
SG&A__ 2,851__ 2,945__ -3.2%__ 2,844__ 0.2%
---- ----- ----- ---- ----- ---
including Sales &
Marketing Expenses__ 748__ 949__ -21.2%__ 633__ 18.2%
------------------- --- --- ----- --- ----
including General &
Administrative Costs__ 2,103__ 1,996__ 5.4%__ 2,211__ -4.9%
--------------------- ----- ----- --- ----- ----
SG&A percentage__ 25.7%__ 27.6%__ 26.7%
--------------- ---- ---- ----
Net income attributable
to VimpelCom__ 86__ 323__ -73.4%__ 841__ -89.8%
----------------------- --- --- ----- --- -----
Mobile subscribers ('000)__ 14,235__ 12,665__ 12.4%__ 13,626__ 4.5%
------------------------- ------ ------ ---- ------ ---
Broadband subscribers
('000)__ 97__ 21__ 361.9%__ 80__ 21.3%
--------------------- --- --- ----- --- ----
The total quarterly revenues from the CIS markets increased year- on-year by 3.9% to 11.1 billion rubles.
Our continued focus on cost control increased consolidated OIBDA margin for the CIS segment by 2 percentage points to a record high of 48.0%, a remarkable achievement in challenging market conditions.
In the third quarter of 2009, we observed a good increase in subscriber numbers across all markets where we operate. Our subscriber base in the CIS reached 14.2 million active users, 12.4% more than a year ago.
Net income attributable to VimpelCom in the CIS segment reached 86 million rubles in the third quarter, with a modest impact from the foreign exchange gain as compared with the second quarter of 2009.
CIS Revenues Development
KAZAKHSTAN (RUR, millions)__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q- o-q
-------------------------- ------ ------ ----- ------ -----
Net operating revenues__ 5,387__ 4,815__ 11.9%__ 5,061__ 6.4%
---------------------- ----- ----- ---- ----- ---
Mobile__ 5,311__ 4,750__ 11.8%__ 4,988__ 6.5%
------ ----- ----- ---- ----- ---
Fixed__ 211__ 146__ 44.5%__ 190__ 11.1%
----- --- --- ---- --- ----
Elimination__ -135__ -81__ -117
----------- ---- --- ----
Net operating revenues (KZT,
millions)__ 25,928__ 23,830__ 8.8%__ 23,679__ 9.5%
---------------------------- ------ ------ --- ------ ---
UKRAINE (RUR, millions)__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o- q
----------------------- ------ ------ ----- ------ -----
Net operating revenues__ 1,773__ 2,283__ -22.3%__ 1,645__ 7.8%
---------------------- ----- ----- ----- ----- ---
Mobile__ 1,066__ 1,653__ -35.5%__ 956__ 11.5%
------ ----- ----- ----- --- ----
Fixed__ 879__ 787__ 11.7%__ 800__ 9.9%
----- --- --- ---- --- ---
Elimination__ -172__ -157__ -111
----------- ---- ---- ----
Net operating revenues (UAH,
millions)__ 442__ 456__ -3.1%__ 390__ 13.3%
---------------------------- --- --- ---- --- ----
ARMENIA (RUR, millions)__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o- q
----------------------- ------ ------ ----- ------ -----
Net operating revenues__ 1,611__ 1,667__ -3.4%__ 1,584__ 1.7%
---------------------- ----- ----- ---- ----- ---
Mobile__ 637__ 764__ -16.6%__ 634__ 0.5%
------ --- --- ----- --- ---
Fixed__ 974__ 903__ 7.9%__ 950__ 2.5%
----- --- --- --- --- ---
Elimination__ 0__ 0__ 0
----------- --- --- ---
Net operating revenues (AMD,
millions)__ 19,167__ 20,786__ -7.8%__ 18,253__ 5.0%
---------------------------- ------ ------ ---- ------ ---
UZBEKISTAN (RUR, millions)__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q- o-q
-------------------------- ------ ------ ----- ------ -----
Net operating revenues__ 1,568__ 1,416__ 10.7%__ 1,693__ -7.4%
---------------------- ----- ----- ---- ----- ----
Mobile__ 1,467__ 1,345__ 9.1%__ 1,594__ -8.0%
------ ----- ----- --- ----- ----
Fixed__ 103__ 71__ 45.1%__ 100__ 3.0%
----- --- --- ---- --- ---
Elimination__ -2__ 0__ -1
----------- --- --- ---
Net operating revenues (US$,
millions)__ 50__ 58__ -13.8%__ 53__ -5.7%
---------------------------- --- --- ----- --- ----
TAJIKISTAN (RUR, millions)__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q- o-q
-------------------------- ------ ------ ----- ------ -----
Mobile net operating revenues__ 468__ 358__ 30.7%__ 461__ 1.5%
----------------------------- --- --- ---- --- ---
Mobile net operating revenues
(US$, millions)__ 14.9__ 14.8__ 0.7%__ 13.7__ 8.8%
----------------------------- ---- ---- --- ---- ---
GEORGIA (RUR, millions)__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o- q
----------------------- ------ ------ ----- ------ -----
Mobile net operating revenues__ 279__ 131__ 113.0%__ 229__ 21.8%
----------------------------- --- --- ----- --- ----
Mobile net operating revenues
(GEL, millions)__ 14.9__ 7.6__ 96.1%__ 11.8__ 26.3%
----------------------------- ---- --- ---- ---- ----
CIS (RUR, millions)__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o-q
------------------- ------ ------ ----- ------ -----
Net operating revenues__ 11,076__ 10,663__ 3.9%__ 10,668__ 3.8%
---------------------- ------ ------ --- ------ ---
Mobile__ 9,221__ 8,999__ 2.5%__ 8,859__ 4.1%
------ ----- ----- --- ----- ---
Fixed__ 2,167__ 1,907__ 13.6%__ 2,040__ 6.2%
----- ----- ----- ---- ----- ---
Elimination__ -312__ -243__ -231
----------- ---- ---- ----
CIS OIBDA Development*
KAZAKHSTAN (RUR, millions) 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q- o-q
-------------------------- ------ ------ ----- ------ -----
OIBDA total__ 3,187__ 2,573__ 23.9%__ 2,745__ 16.1%
----------- ----- ----- ---- ----- ----
Mobile__ 3,064__ 2,495__ 22.8%__ 2,643__ 15.9%
------ ----- ----- ---- ----- ----
Fixed__ 123__ 78__ 57.7%__ 102__ 20.6%
----- --- --- ---- --- ----
OIBDA margin, %__ 59.2%__ 53.4%__ 54.2%
--------------- ---- ---- ----
UKRAINE (RUR, millions)__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o- q
----------------------- ------ ------ ----- ------ -----
OIBDA total__ 380__ -40__ n/a__ 322__ 18.0%
----------- --- --- --- --- ----
Mobile__ 140__ -215__ n/a__ 82__ 70.7%
------ --- ---- --- --- ----
Fixed__ 240__ 175__ 37.1%__ 240__ 0.0%
----- --- --- ---- --- ---
OIBDA margin, %__ 21.4%__ n/a__ 19.6%
--------------- ---- --- ----
ARMENIA (RUR, millions) 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o-q
----------------------- ------ ------ ----- ------ -----
OIBDA total__ 825__ 813__ 1.5%__ 799__ 3.3%
----------- --- --- --- --- ---
Mobile__ 306__ 337__ -9.2%__ 298__ 2.7%
------ --- --- ---- --- ---
Fixed__ 519__ 476__ 9.0%__ 501__ 3.6%
----- --- --- --- --- ---
OIBDA margin, %__ 51.2%__ 48.8%__ 50.4%
--------------- ---- ---- ----
UZBEKISTAN (RUR, millions) 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q- o-q
-------------------------- ------ ------ ----- ------ -----
OIBDA total__ 738__ 798__ -7.5%__ 865__ -14.7%
----------- --- --- ---- --- -----
Mobile__ 696__ 774__ -10.1%__ 825__ -15.6%
------ --- --- ----- --- -----
Fixed__ 42__ 24__ 75.0%__ 40__ 5.0%
----- --- --- ---- --- ---
OIBDA margin, %__ 47.1%__ 56.4%__ 51.1%
--------------- ---- ---- ----
TAJIKISTAN (RUR, millions) 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q- o-q
-------------------------- ------ ------ ----- ------ -----
Mobile OIBDA__ 162__ 115__ 40.9%__ 173__ -6.4%
------------ --- --- ---- --- ----
Mobile OIBDA margin, %__ 34.6%__ 32.1%__ 37.5%
---------------------- ---- ---- ----
GEORGIA (RUR, millions)__ 3Q '09__ 3Q '08__ y-o-y 2Q '09__ q-o-q
----------------------- ------ ------ ----- ------ -----
Mobile OIBDA__ 30__ -27__ n/a__ 4__ 650.0%
------------ --- --- --- --- -----
Mobile OIBDA margin, %__ 10.8%__ n/a__ 1.7%
---------------------- ---- --- ---
CIS (RUR, millions) 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o-q
------------------- ------ ------ ----- ------ -----
OIBDA total__ 5,322__ 4,232__ 25.8%__ 4,908__ 8.4%
----------- ----- ----- ---- ----- ---
Mobile__ 4,398__ 3,479__ 26.4%__ 4,025__ 9.3%
------ ----- ----- ---- ----- ---
Fixed__ 924__ 753__ 22.7%__ 883__ 4.6%
----- --- --- ---- --- ---
OIBDA margin, %__ 48.0%__ 39.7%__ 46.0%
--------------- ---- ---- ----
* Please find information on respective operating income amounts in the supplementary file FinancialOperatingQ32009.xls on our website at www.vimpelcom.com/news/qrep.wbp.
CIS Operating Highlights
KAZAKHSTAN__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o-q
---------- ------ ------ ----- ------ -----
Mobile subscribers*) ('000)__ 6,835__ 5,614__ 21.7%__ 6,635__ 3.0%
--------------------------- ----- ----- ---- ----- ---
MOU, min__ 98.1__ 108.1__ -9.3%__ 90.7__ 8.2%
-------- ---- ----- ---- ---- ---
ARPU mobile, (RUR)__ 257.9__ 294.1__ -12.3%__ 253.6__ 1.7%
------------------ ----- ----- ----- ----- ---
ARPU mobile, (KZT)__ 1,240.7 1,455.4__ -14.8% 1,187.1__ 4.5%
------------------ ------- ------- ----- ------- ---
Broadband subscribers ('000)__ 0.3__ n/a__ 0.3__ 0.0%
---------------------------- --- --- --- ---
UKRAINE__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o-q
------- ------ ------ ----- ------ -----
Mobile subscribers*) ('000)__ 2,199__ 2,403__ -8.5%__ 1,934__ 13.7%
--------------------------- ----- ----- ---- ----- ----
MOU, min__ 203.7__ 261.5__ -22.1%__ 217.8__ -6.5%
-------- ----- ----- ----- ----- ----
ARPU mobile, (RUR)__ 168.3__ 234.9__ -28.4%__ 166.8__ 0.9%
------------------ ----- ----- ----- ----- ---
ARPU mobile, (UAH)__ 42.0__ 47.4__ -11.4%__ 39.7__ 5.8%
------------------ ---- ---- ----- ---- ---
Broadband subscribers ('000)__ 70__ 16__ 337.5%__ 53__ 32.1%
---------------------------- --- --- ----- --- ----
ARMENIA__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o-q
------- ------ ------ ----- ------ -----
Mobile subscribers*) ('000)__ 502__ 784__ -36.0%__ 486__ 3.3%
--------------------------- --- --- ----- --- ---
MOU, min__ 269.0__ 139.9__ 92.3%__ 238.4__ 12.8%
-------- ----- ----- ---- ----- ----
ARPU mobile, (RUR)__ 429.7__ 336.9__ 27.5%__ 436.9__ -1.6%
------------------ ----- ----- ---- ----- ----
ARPU mobile, (AMD)__ 5,117.2 4,200.1__ 21.8% 5,034.7__ 1.6%
------------------ ------- ------- ---- ------- ---
Broadband subscribers ('000)__ 18.1__ 5.4__ 235.2%__ 19.2__ - 5.7%
---------------------------- ---- --- ----- ---- ----
UZBEKISTAN__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o-q
---------- ------ ------ ----- ------ -----
Mobile subscribers*) ('000)__ 3,652__ 3,148__ 16.0%__ 3,605__ 1.3%
--------------------------- ----- ----- ---- ----- ---
MOU, min__ 409.3__ 298.5__ 37.1%__ 225.6__ 81.4%
-------- ----- ----- ---- ----- ----
ARPU mobile, (RUR)__ 140.7__ 157.5__ -10.7%__ 150.6__ -6.6%
------------------ ----- ----- ----- ----- ----
ARPU mobile, (US$)__ 4.5__ 6.5__ -30.8%__ 4.7__ -4.3%
------------------ --- --- ----- --- ----
Broadband subscribers ('000)__ 8.3__ n/a__ 7.6__ 9.2%
---------------------------- --- --- --- ---
TAJIKISTAN__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o-q
---------- ------ ------ ----- ------ -----
Mobile subscribers*) ('000)__ 706__ 527__ 34.0%__ 677__ 4.3%
--------------------------- --- --- ---- --- ---
MOU, min__ 173.3__ 255.9__ -32.3%__ 173.1__ 0.1%
-------- ----- ----- ----- ----- ---
ARPU mobile, (RUR)__ 224.1__ 250.7__ -10.6%__ 221.6__ 1.1%
------------------ ----- ----- ----- ----- ---
ARPU mobile, (US$)__ 7.2__ 10.4__ -30.8%__ 6.9__ 4.3%
------------------ --- ---- ----- --- ---
GEORGIA__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o-q
------- ------ ------ ----- ------ -----
Mobile subscribers*) ('000)__ 341__ 189__ 80.4%__ 289__ 18.0%
--------------------------- --- --- ---- --- ----
MOU, min__ 129.3__ 109.8__ 17.8%__ 123.1__ 5.0%
-------- ----- ----- ---- ----- ---
ARPU mobile, (RUR)__ 288.5__ 238.9__ 20.8%__ 283.6__ 1.7%
------------------ ----- ----- ---- ----- ---
ARPU mobile, (GEL)__ 15.4__ 14.0__ 10.0%__ 14.5__ 6.2%
------------------ ---- ---- ---- ---- ---
* Starting with this quarterly report, we no longer provide information on subscriber market share. This is because different churn policies used by mobile service providers result in reported subscriber market share figures that could be misleading.
South-East Asia
Cambodian operations have been actively developing since our launch in May 2009. As of the third quarter of 2009, our services are available in the 17 largest provinces reaching 42% of the country's population. By the end of 2009, we plan to expand coverage to reach more than two thirds of the country's population.
According to the latest independent research Beeline brand awareness was ranked third among 9 mobile operators in Cambodia with brand awareness at 62% on a country-wide level and 98% in the capital.
Two months after the network launch in Vietnam, our networks cover the capital and the two largest cities as well as the 8 most populated provinces. By the end of January 2010, we plan to cover more than 40 provinces of Vietnam with a population of about 41 million.
Our distribution network in Vietnam was extended to more than 10,000 points of sales including traditional retail outlets and new channels like Branded Trade Counters. According to the latest independent research, in the three largest cities of Vietnam the Beeline brand has reached 80% awareness level among the 15-65 year- old audience.
SEA*) (RUR, millions)__ 3Q '09__ 3Q '08__ y-o-y 2Q '09__ q-o-q
--------------------- ------ ------ ----- ------ -----
Net operating revenues__ 74__ 0__ n/a__ 28__ 164.3%
---------------------- --- --- --- --- -----
OIBDA total__ -234__ -4__ n/a__ -174__ n/a
----------- ---- --- --- ---- ---
*) See definitions in Attachment A.
For more information on financial and operating data for specific countries, please refer to the supplementary file FinancialOperatingQ32009.xls on our website at www.vimpelcom.com/ news/qrep.wbp.
The Company's management will discuss its third quarter 2009 results during a conference call and slide presentation on November 24, 2009 at 6:30 pm Moscow time (10:30 am US ET). The call and slide presentation may be accessed via webcast at the following URL address www.vimpelcom.com. The conference call replay will be available through December 1, 2009. The slide presentation webcast will also be available for download on VimpelCom's website www.vimpelcom.com.
The VimpelCom Group consists of telecommunications operators providing voice and data services through a range of mobile, fixed and broadband technologies. The Group includes companies operating in Russia, Kazakhstan, Ukraine, Uzbekistan, Tajikistan, Georgia, Armenia, as well as Vietnam and Cambodia, in territories with a total population of about 340 million. VimpelCom was the first Russian company to list its shares on the New York Stock Exchange ("NYSE"). VimpelCom's ADSs are listed on the NYSE under the symbol "VIP".
This press release contains "forward-looking statements", as the phrase is defined in Section 27A of the Securities Act and Section 21E of the Exchange Act. These statements relate to the proposed combination with Kyivstar and its benefits, the Company's__ 2009 capital expenditures and the Company's development plans in Cambodia and Vietnam. These and other forward-looking statements are based on management's best assessment of the Company's strategic and financial position and of future market conditions and trends. These discussions involve risks and uncertainties. The actual outcome may differ materially from these statements as a result of continued volatility in the economies in the markets in which the Company operates, unforeseen developments from competition, governmental regulation of the telecommunications industries, general political uncertainties in the markets in which the Company operates and/or litigation with third parties. The actual outcome may also differ materially if the Company is unable to obtain all necessary corporate approvals relating to its business, if the Company is unable to successfully integrate newly-acquired businesses, including Golden Telecom, and other factors. There can be no assurance that such risks and uncertainties will not have a material adverse effect on the VimpelCom Group. Certain factors that could cause actual results to differ materially from those discussed in any forward-looking statements include the risks described in the Company's Annual Report on Form 20-F for the year ended December 31, 2008 and other public filings made by the Company with the United States Securities and Exchange Commission, which risk factors are incorporated herein by reference. VimpelCom disclaims any obligation to update developments of these risk factors or to announce publicly any revision to any of the forward-looking statements contained in this release, or to make corrections to reflect future events or developments.
IMPORTANT NOTICE: The proposed exchange offer described in this communication has not yet commenced, and the description of the proposed exchange offer contained in this communication is not an offer to buy or the solicitation of an offer to sell securities.
If the proposed exchange offer is commenced, the Company expects that VimpelCom Ltd. will file with the SEC a registration statement and other related materials with respect to the proposed exchange offer, and the Company will file with the SEC a solicitation/ recommendation statement on Schedule 14D-9 with respect to the proposed exchange offer. Investors and shareholders are urged to read the registration statement and other related materials, the solicitation/recommendation statement on Schedule 14D-9 and any amendments, exhibits or other applicable documents regarding the proposed exchange offer if and when they become available because they will contain important information. Those materials will be made available to the Company's shareholders at no expense to them. In addition, all of those materials (and all other exchange offer documents filed with the SEC) will be made available at no charge on the SEC's website at www.sec.gov.
- Definitions and tables are attached -
Attachment A: Definitions
Mobile subscribers are those subscribers in the registered subscriber base who were a party to a revenue generating activity in the past three months and remain in the base at the end of the reported period, except for the subscriber base in Cambodia which is calculated on a one month basis. Such activities include all incoming and outgoing calls, subscriber fee accruals, debits related to service, outgoing SMS, MMS, data transmission and receipt sessions, but do not include incoming SMS and MMS sent by our Company or abandoned calls. Total number of mobile subscribers also includes subscribers using mobile internet service via USB modems.
Each ADS represents 0.05 of one share of common stock. This ratio was established effective August 21, 2007.
ARPU (Monthly Average Revenue per User), a non-U.S. GAAP financial measure, is calculated by dividing the Company's service revenue during the relevant period, including roaming revenue and interconnect revenue, but excluding revenue from connection fees, sales of handsets and accessories and other non-service revenue, by the average number of the Company's subscribers during the period and dividing by the number of months in that period. The Company believes that ARPU provides useful information to investors because it is an indicator of the performance of the Company's business operations and assists management in budgeting. The Company also believes that ARPU provides management with useful information concerning usage and acceptance of the Company's services. ARPU should not be viewed in isolation or an alternative to other figures reported under U.S. GAAP.
Broadband subscribers are those subscribers in the registered subscriber base who were a party to a revenue generating activity in the past three months. Such activities include monthly internet access using FTTB, xDSL and WiFi technologies as well as mobile internet service via USB modems.
CIS Geographic Segment for the purpose of VimpelCom reporting includes our operations in the following countries: Kazakhstan, Ukraine, Uzbekistan, Tajikistan, Armenia and Georgia
Fixed-line subscriber is an authorized user of fixed-line communications services.
General and administrative costs (G&A) include salaries and outsourcing costs, including related social contributions required by Russian law; stock price-based compensation expenses; repair and maintenance expenses; rent, including lease payments for base station sites; utilities; other miscellaneous expenses, such as insurance, operating taxes, license fees, and accounting, audit and legal fees.
Households passed are households located within buildings, in which indoor installation of all the FTTB equipment necessary to install terminal residential equipment has been completed.
Mobile services are wireless voice and data transmission services excluding WiFi.
MOU (Monthly Average Minutes of Use per User) is calculated by dividing the total number of minutes of usage for incoming and outgoing calls during the relevant period (excluding guest roamers) by the average number of mobile subscribers during the period and dividing by the number of months in that period.
OIBDA is a non-U.S. GAAP financial measure. OIBDA, previously referred to as EBITDA by the Company, is defined as operating income before depreciation, amortization and impairment loss. The Company believes that OIBDA provides useful information to investors because it is an indicator of the strength and performance of our business operations, including our ability to finance capital expenditures, acquisitions and other investments and our ability to incur and service debt. While depreciation, amortization and impairment loss are considered operating costs under U.S. GAAP, these expenses primarily represent the non-cash current period allocation of costs associated with long-lived assets acquired or constructed in prior periods. Our OIBDA calculations are commonly used as bases for some investors, analysts and credit rating agencies to evaluate and compare the periodic and future operating performance and value of companies within the telecommunications industry. OIBDA should not be considered in isolation as an alternative to net income attributable to VimpelCom, operating income or any other measure of performance under U.S. GAAP. OIBDA does not include our need to replace our capital equipment over time. Reconciliation of OIBDA to operating income, the most directly comparable U.S. GAAP financial measure, is presented below in the reconciliation tables section.
OIBDA margin is OIBDA expressed as a percentage of net operating revenues. Reconciliation of OIBDA margin to operating income as a percentage of net operating revenues, the most directly comparable U.S. GAAP financial measure, is presented below in the reconciliation tables section.
Prepaid subscribers are those subscribers who pay for their services in advance.
Roaming revenues include both revenues from VimpelCom customers who roam outside of home country network and revenues from other wireless carriers for roaming by their customers on VimpelCom's network.
Sales and marketing costs (S&M) include marketing, advertising and dealer commissions expenses.
Take-up rate for the FTTB network is calculated by dividing the number of FTTB subscribers by the total number of households passed.
VAS (value added services) includes short messages ("SMS"), multimedia messages ("MMS"), caller number identification, call waiting, data transmission, mobile Internet, downloadable content and other services.
Capital expenditures (Capex) - purchases of new equipment, new construction, upgrades, software, other long lived assets and related reasonable costs incurred prior to intended use of the non current asset, accounted at the earliest event of advance payment or delivery. Long-lived assets acquired in business combinations are not included in capital expenditures.
SEA - VimpelCom operations in South-East Asia, which include operations in Cambodia and__ VimpelCom's respective equity in net results of operations of the Company's Vietnamese associate GTEL- Mobile JSC ("GTEL-Mobile").
Net debt is calculated as the sum of short-term debt and long- term debt minus cash and cash equivalents.
Attachment B: VimpelCom financial statements
Open Joint Stock Company "Vimpel-Communications"
Unaudited Condensed Consolidated Statements of Income
Three months ended__ Nine months ended
September 30,__ September 30,
2009__ 2008__ 2009__ 2008
---- ---- ---- ----
(In millions of Russian rubles, except
share (ADS) amounts)
Operating revenues:
Service revenues__ 70,359__ 67,913__ 204,047__ 180,516
Sales of equipment
and accessories__ 863__ 949__ 2,885__ 1,054
Other revenues__ 173__ 123__ 475__ 317
--- --- --- ---
Total operating
revenues__ 71,395__ 68,985__ 207,407__ 181,887
Revenue based tax__ (57)__ (52)__ (191)__ (132)
--- --- ---- ----
Net operating
revenues__ 71,338__ 68,933__ 207,216__ 181,755
Operating expenses:
Service costs__ 15,306__ 15,916__ 44,460__ 40,462
Cost of equipment
and accessories__ 886__ 921__ 2,841__ 1,016
Selling, general and
administrative
expenses__ 18,760__ 18,167__ 55,424__ 49,265
Depreciation__ 11,452__ 9,687__ 32,355__ 27,445
Amortization__ 2,229__ 2,381__ 6,934__ 6,399
Provision for
doubtful accounts__ 406__ 293__ 1,387__ 1,172
--- --- ----- -----
Total operating
expenses__ 49,039__ 47,365__ 143,401__ 125,759
------ ------ ------- -------
Operating income__ 22,299__ 21,568__ 63,815__ 55,996
Other income
and expenses:
Interest income__ 242__ 436__ 1,342__ 1,376
Net foreign
exchange gain/
(loss)__ 693__ (8,269)__ (12,304)__ (3,173)
Interest expense__ (4,914)__ (3,439)__ (14,074)__ (8,220)
Equity in net
gain/(loss)
of associates__ 152__ 65__ (862)__ 65
Other (expenses)/
income, net__ (105)__ (181)__ (290)__ (438)
---- ---- ---- ----
Total other income
and expenses__ (3,932)__ (11,388)__ (26,188)__ (10,390)
------ ------- ------- -------
Income before
income taxes
and noncontrolling
interest__ 18,367__ 10,180__ 37,627__ 45,606
Income tax expense__ 4,809__ 3,359__ 10,127__ 12,326
----- ----- ------ ------
Net income__ 13,558__ 6,821__ 27,500__ 33,280
Net income/(loss)
attributable to the
noncontrolling
interest__ 45__ 308__ (98)__ 1,071
--- --- --- -----
Net income
attributable
to VimpelCom__ 13,513__ 6,513__ 27,598__ 32,209
======__ =====__ ======__ ======
Basic EPS:
Net income
attributable
to VimpelCom
per common share__ 266.83__ 128.68__ 545.11__ 634.94
======__ ======__ ======__ ======
Weighted average
common shares
outstanding
(thousand)__ 50,643__ 50,615__ 50,628__ 50,728
Net income
attributable
to VimpelCom
per ADS equivalent__ 13.34__ 6.43__ 27.26__ 31.75
=====__ ====__ =====__ =====
Diluted EPS:
Net income
attributable
to VimpelCom
per common share__ 261.01__ 128.68__ 525.36__ 634.94
======__ ======__ ======__ ======
Weighted average
diluted shares
(thousand)__ 51,771__ 50,615__ 52,532__ 50,728
Net income
attributable
to VimpelCom
per ADS equivalent__ 13.05__ 6.43__ 26.27__ 31.75
=====__ ====__ =====__ =====
Open Joint Stock Company "Vimpel-Communications"
Unaudited Condensed Consolidated Balance Sheets
September__ December
30,__ 31,
2009__ 2008
---- ----
(In millions of Russian rubles,
except share amounts)
Assets
Current assets:
Cash and cash equivalents__ 75,902__ 26,873
Trade accounts receivable, net of allowance
for doubtful accounts__ 13,341__ 13,974
Inventory__ 2,461__ 4,191
Deferred income taxes__ 2,104__ 2,432
Input value added tax__ 3,994__ 5,349
Due from related parties__ 8,509__ 4,942
Other current assets__ 5,924__ 12,941
----- ------
Total current assets__ 112,235__ 70,702
Property and equipment, net__ 168,407__ 188,778
Telecommunications licenses, net__ 17,862__ 22,470
Goodwill__ 98,930__ 102,148
Other intangible assets, net__ 21,996__ 25,935
Software, net__ 12,584__ 16,134
Investments in associates__ 13,801__ 14,501
Other assets__ 22,707__ 21,314
------ ------
Total assets__ 468,522__ 461,982
=======__ =======
Liabilities and equity
Current liabilities:
Accounts payable__ 15,198__ 26,409
Due to employees__ 3,343__ 3,108
Due to related parties__ 502__ 142
Accrued liabilities__ 11,646__ 8,484
Taxes payable__ 10,476__ 4,471
Customer advances, net of VAT__ 9,302__ 12,492
Customer deposits__ 824__ 868
Short-term debt__ 74,516__ 56,093
------ ------
Total current liabilities__ 125,807__ 112,067
Deferred income taxes__ 16,453__ 18,934
Long-term debt__ 168,293__ 191,963
Other non-current liabilities__ 5,266__ 3,608
Commitments, contingencies and uncertainties__ -__ -
Equity:
Convertible voting preferred stock (.005
rubles nominal value per share), 10,000,000
shares authorized; 6,426,600 shares issued
and outstanding__ -__ -
Common stock (.005 rubles nominal value per
share), 90,000,000 shares authorized;
51,281,022 shares issued (December 31,
2008: 51,281,022);__ 50,683,660 shares
outstanding (December 31, 2008: 50,617,408)__ 3__ 3
Additional paid-in capital__ 42,688__ 42,624
Retained earnings__ 115,194__ 87,599
Accumulated other comprehensive
(loss)/income__ (5,105)__ 3,992
Treasury stock, at cost,__ 597,362 shares of
common stock (December 31, 2008: 663,614)__ (5,692)__ (5,983)
------ ------
Total VimpelCom shareholders' equity__ 147,088__ 128,235
Noncontrolling interest__ 5,615__ 7,175
----- -----
Total equity__ 152,703__ 135,410
------- -------
Total liabilities and equity__ 468,522__ 461,982
=======__ =======
Open Joint Stock Company "Vimpel-Communications"
Unaudited Condensed Consolidated Statements of Cash Flows
Nine months ended September
30,
2009__ 2008
---- ----
(In millions of Russian rubles)
Operating activities
Net cash provided by operating activities__ 88,998__ 62,117
Investing activities
Purchases of property and equipment__ (15,699)__ (33,206)
Purchases of intangible assets__ (435)__ (1,747)
Purchases of software__ (4,180)__ (5,093)
Acquisition of subsidiaries, net of cash
acquired__ -__ (100,348)
Late payment for investment in associate__ (389)__ -
Exercise of escrow cash deposit__ -__ 4,856
Loan granted__ -__ (8,491)
Short-term deposits__ -__ (2,368)
Purchases of other assets, net__ (958)__ (1,578)
---- ------
Net cash used in investing activities__ (21,661)__ (147,975)
Financing activities
Proceeds from bank and other loans__ 38,920__ 130,718
Proceeds from sale of treasury stock__ -__ 608
Repayments of bank and other loans__ (54,817)__ (10,227)
Payments of fees in respect of debt issues__ (1,671)__ (1,322)
Net proceeds from employee stock options__ 171__ -
Purchase of noncontrolling interest in
consolidated subsidiaries__ (14)__ (23,462)
Payment of dividends to noncontrolling
party__ (23)__ (14,240)
Purchase of treasury stock__ -__ (2,751)
--- ------
Net cash (used in)/provided by financing
activities__ (17,434)__ 79,324
Effect of exchange rate changes on cash
and cash equivalents__ (875)__ 259
---- ---
Net__ increase/(decrease) in cash and cash
equivalents__ 49,029__ (6,275)
Cash and cash equivalents at beginning of
period__ 26,873__ 24,637
------ ------
Cash and cash equivalents at end of period__ 75,902__ 18,362
======__ ======
Supplemental cash flow information
Cash paid during the period:
Income tax__ 8,917__ 12,603
Interest__ 9,335__ 4,905
Non-cash activities:
Equipment acquired under financing agreements__ 6__ 1,448
Accounts payable for equipment and__ other
long-lived assets__ 3,856__ 7,495
Acquisitions :
Fair value of assets acquired__ -__ 64,159
Fair value of noncontrolling interest acquired__ -__ 4,968
Difference between the amount paid and the
fair value of net assets acquired__ -__ 85,062
Consideration for the acquisition of
subsidiaries__ -__ (129,430)
--- --------
Change in fair value of liabilities
assumed__ -__ 24,759
===__ ======
Attachment C: Reconciliation Tables (Unaudited)
Reconciliation of Consolidated OIBDA
(In millions of Russian rubles)
OIBDA Consolidated Total__ 3Q '09__ 3Q '08__ 2Q '09
------------------------ ------ ------ ------
OIBDA__ 35,980__ 33,636__ 34,958
----- ------ ------ ------
Depreciation__ (11,452)__ (9,687)__ (10,451)
------------ ------- ------ -------
Amortization__ (2,229)__ (2,381)__ (2,257)
------------ ------ ------ ------
Operating income__ 22,299__ 21,568__ 22,250
---------------- ------ ------ ------
Reconciliation of OIBDA Margin
OIBDA Margin Consolidated Total__ 3Q '09__ 3Q '08__ 2Q '09
------------------------------- ------ ------ ------
OIBDA margin__ 50.4%__ 48.8%__ 50.6%
------------ ---- ---- ----
Less: Depreciation as a percentage
of net operating revenues__ (16.0%)__ (14.0%)__ (15.1%)
---------------------------------- ------- ------- -------
Less: Amortization as a percentage
of net operating revenues__ (3.1%)__ (3.5%)__ (3.3%)
---------------------------------- ------ ------ ------
Operating income as a percentage of
net operating revenues__ 31.3%__ 31.3%__ 32.2%
----------------------------------- ---- ---- ----
Attachment D: Capex Development__
CAPEX (RUR, millions)__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o-q
--------------------- ------ ------ ----- ------ -----
Total capex__ 3,842__ 16,799__ -77.1%__ 5,027__ -23.6%
----------- ----- ------ ----- ----- -----
Russia__ 2,827__ 12,224__ -76.9%__ 3,440__ -17.8%
------ ----- ------ ----- ----- -----
CIS__ 756__ 4,527__ -83.3%__ 817__ -7.5%
--- --- ----- ----- --- ----
Kazakhstan__ 310__ 1,868__ -83.4%__ 376__ -17.6%
---------- --- ----- ----- --- -----
Ukraine__ 95__ 1,137__ -91.6%__ 95__ 0.0%
------- --- ----- ----- --- ---
Armenia__ 48__ 462__ -89.6%__ 12__ 300.0%
------- --- --- ----- --- -----
Uzbekistan__ 207__ 688__ -69.9%__ 241__ -14.1%
---------- --- --- ----- --- -----
Tajikistan__ 16__ 156__ -89.7%__ 24__ -33.3%
---------- --- --- ----- --- -----
Georgia__ 80__ 216__ -63.0%__ 69__ 15.9%
------- --- --- ----- --- ----
SEA__ 258__ 9__ 2767%__ 761__ -66.1%
--- --- --- ---- --- -----
Attachment E: Key Financial Results in US Dollars (Convenience Translation)
CONSOLIDATED OPERATIONS
(US$, millions)__ 3Q '09__ 3Q '08__ y-o-y__ 2Q '09__ q-o-q
----------------------- ------ ------ ----- ------ -----
Net operating revenues__ 2,277__ 2,843__ -19.9%__ 2,143__ 6.3%
---------------------- ----- ----- ----- ----- ---
OIBDA__ 1,149__ 1,388__ -17.2%__ 1,085__ 5.9%
----- ----- ----- ----- ----- ---
OIBDA margin, %__ 50.5%__ 48.8%__ 50.6%
--------------- ---- ---- ----
Operating income__ 712__ 890__ -20.0%__ 691__ 3.0%
---------------- --- --- ----- --- ---
Operating income margin,
%__ 31.3%__ 31.3%__ 32.2%
------------------------ ---- ---- ----
SG&A__ 599__ 749__ -20.0%__ 573__ 4.5%
---- --- --- ----- --- ---
including Sales &
Marketing Expenses__ 184__ 242__ -24.0%__ 168__ 9.5%
------------------- --- --- ----- --- ---
including General &
Administrative Costs__ 415__ 507__ -18.1%__ 405__ 2.5%
--------------------- --- --- ----- --- ---
SG&A percentage__ 26.3%__ 26.3%__ 26.7%
--------------- ---- ---- ----
Net income attributable
to VimpelCom__ 431__ 269__ 60.2%__ 702__ -38.6%
----------------------- --- --- ---- --- -----
Net income attributable
to VimpelCom per common
share, basic (US$)__ 8.52__ 5.31__ 13.86
------------------------ ---- ---- -----
Net income attributable
to VimpelCom per ADS
equivalent, basic (US$)__ 0.43__ 0.27__ 0.69
------------------------ ---- ---- ----
Capital expenditures__ 123__ 692.9__ -82.2%__ 156.0__ -21.2%
-------------------- --- ----- ----- ----- -----
Attachment F: Average Rates of Functional Currencies to Ruble*
Functional
Currency/
1 RUR__ 1Q '08__ 2Q '08__ 3Q '08__ 4Q '08__ 1Q '09__ 2Q '09__ 3Q '09
--------------- ------ ------ ------ ------ ------ ------ ------
Kazakhstan__ KZT__ 4.9690__ 5.1038__ 4.9540__ 4.4077__ 4.0948__ 4.6771__ 4.8200
---------- --- ------ ------ ------ ------ ------ ------ ------
Ukraine__ UAH__ 0.2081__ 0.2101__ 0.2003__ 0.2274__ 0.2281__ 0.2376__ 0.2496
------- --- ------ ------ ------ ------ ------ ------ ------
Tajikistan__ USD__ 0.0412__ 0.0423__ 0.0412__ 0.0367__ 0.0295__ 0.0311__ 0.0319
---------- --- ------ ------ ------ ------ ------ ------ ------
Uzbekistan__ USD__ 0.0412__ 0.0423__ 0.0412__ 0.0367__ 0.0295__ 0.0311__ 0.0319
---------- --- ------ ------ ------ ------ ------ ------ ------
Armenia__ AMD 12.6926 13.0012 12.4664__ 11.2309__ 9.6090__ 11.5227__ 11.9095
------- --- ------- ------- ------- ------- ------ ------- ------ -
Georgia__ GEL__ 0.0641__ 0.0612__ 0.0582__ 0.0568__ 0.0495__ 0.0515__ 0.0535
------- --- ------ ------ ------ ------ ------ ------ ------
Cambodia__ USD__ 0.0311__ 0.0319
-------- --- ------ ------
* Functional currencies in Tajikistan, Uzbekistan and Cambodia are US dollars.
SOURCE: Vimpel-Communications
Originally published by Vimpel-Communications.
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