Mobile phone group VimpelCom forecast earnings and revenues would grow by a mid single-digit percentage from 2012-14, with its purchase of Wind Telecom last year providing a boost amid tough trading conditions at home.
The firm, which now has operations in Italy and North Africa in addition to Russia and the CIS as a result of the $6 billion deal, set the growth target for earnings before interest, tax, depreciation and amortization, or EBITDA, as well as revenue.
VimpelCom said Tuesday that it made a net loss of $386 million in the fourth quarter of 2011, hit by noncash items of $437 million relating to foreign exchange movements and one-off charges on operations in Vietnam and Cambodia as well as the Wind deal.
"We thought maybe there would be some one-offs relating to the Wind deal, but it is still a negative surprise. … Unfortunately there is also not much growth in operations, held back by the Russian operation," VTB analyst Viktor Klimovich said.
EBITDA fell 3 percent in the fourth quarter to $2.2 billion. However, revenues rose 5 percent excluding acquisitions to $5.9 billion and mobile subscriber numbers were up 13 percent to 205 million.
"The 2011 results provide a good platform for profitable growth and improved cash flows. … We expect to leverage the benefits of our increased size and capabilities," VimpelCom chief executive Jo Lunder said in a statement.
The firm's strategy includes cost savings and adding subscribers in its core Russian market, where the firm has been losing market share to rivals MTS and MegaFon.
VimpelCom, long the stage of a battle between top shareholders Telenor of Norway and Russia's Altimo, said it would pay a dividend of 0.80 cents per share for 2011. It is committed to a payout of at least that until 2014.
A Message from The Moscow Times:
Dear readers,
We are facing unprecedented challenges. Russia's Prosecutor General's Office has designated The Moscow Times as an "undesirable" organization, criminalizing our work and putting our staff at risk of prosecution. This follows our earlier unjust labeling as a "foreign agent."
These actions are direct attempts to silence independent journalism in Russia. The authorities claim our work "discredits the decisions of the Russian leadership." We see things differently: we strive to provide accurate, unbiased reporting on Russia.
We, the journalists of The Moscow Times, refuse to be silenced. But to continue our work, we need your help.
Your support, no matter how small, makes a world of difference. If you can, please support us monthly starting from just $2. It's quick to set up, and every contribution makes a significant impact.
By supporting The Moscow Times, you're defending open, independent journalism in the face of repression. Thank you for standing with us.
Remind me later.
