OREANDA-NEWS. December 25, 2007. Dalsvyaz announced the unaudited results of its 9M07 financial performance in accordance with International Financial Reporting Standards (IFRS).

The operator's consolidated financial reports for the first nine months of 2007 are unaudited and are given in the accounting balance sheet, the Profit & Loss statement, and annotations thereto. Earlier Dalsvyaz had not presented such financial reports.

The general director of Dalsvyaz Anton Kolpakov noted the importance of quarterly disclosure of information drafted to IFRS.  "As for the company's performance, it has shown strong margins and a rapid pace of business expansion. In 9M07, we outpaced FY06 performance in terms of revenue, operating margin and net profit.  Our priorities remain high market stakes in the company's key segments, bigger shares of unregulated services and stronger ARPU, the company's general director said.

The main growth drivers for revenue from telecom services during the reporting period were:

- increasing the VAS subscriber base;

- introducing new tariff plans in the local voice segment;

- introduction of the Calling Party Pays principle in intrazonal calls;

- telegraph services, datacom services and telematic services.

The fastest pace of growth was observed in broadband Internet access services. The rise in revenue was due to expansion of the subscriber base.  The number of users skyrocketed 130% and stood at 132,769 as of September 2007. Meanwhile, dial-up rates were hiked, which made it possible to keep revenue at the 2006 level.

Dial-up Internet access remained essentially unchanged due to the fact that many users are switching over to DSL. 

In 9M07, revenue from IP TV reached Rub 36 mln in the four regions where Dalsvyaz operates (Primorsk, Khabarovsk, Kamchatka, and the Jewish Autonomous Republic).


Local voice

The rise in local voice revenue was attributable to the introduction of new tariff plans (unlimited, combined and time-based) as of February 1, 2007.  Aside from this, the company's subscriber base increased 2% to 1,366,855.

 
Intrazonal calls

Higher revenue in 9M07 from intrazonal calls was due to introduction of the Calling Party Pays (CPP) principle in July 2006, according to which fixed-line calls made to cellular phones became chargeable in the administrative center.  Thus, revenue generated by CPP traffic reached Rub 267 mln in 9M07.

 
Cellular telecommunications

Revenue from cellular communications reached Rub 871.9 mln in the first nine months of 2007.


Equity and borrowed capital

The company"s net assets as of September 30, 2007 stood at 30.4% and reached Rub 9,155.4 mln (up from Rub 7,018.5 mln as of December 31, 2006), whereas the proportion of borrowed capital decreased y-o-y by 5.2% from 59.5% to 54.3%.

The percentage of debt increased 9% to Rub 7,212.4 mln, whereas net debt decreased 5.8% to Rub 6,062.2 mln.