MTS says Jul–Sep IFRS net profit falls by 12.5% to 16.5 bln rbl

MOSCOW, Nov 17 (PRIME) -- The net profit of major Russian mobile operator MTS decreased by 12.5% on the year to 16.5 billion rubles in July–September, as calculated under International Financial Reporting Standards (IFRS), the company said on Wednesday in a statement.

The net profit was “supported by core business performance and MTS Bank. At the same time, the net profit was constrained by higher depreciation and amortization of fixed and intangible assets, reflecting the company’s deliberate investment in network development and other areas, as well as an increase in financing costs versus the year-ago quarter due to higher net debt and an evolving interest rate environment, among other factors,” MTS said.

Revenue increased 8.4% to 138.2 billion rubles “on the back of growth in all key verticals: telecom, fintech, media, retail, and business-to-business cloud and digital solutions.” MTS’ Russia revenue rose 8.5% to 136.4 billion rubles.

Operating income before depreciation and amortization (OIBDA) grew 4.2% to 61.3 billion rubles. Operating profit decreased 0.2% to 33.5 billion rubles.

Cash capital expenditures increased 41.5% to 33.1 billion rubles. The net debt widened 31.2% to 396.7 billion rubles.

“MTS currently forecasts high-single-digit growth for 2021 group revenue versus 2020… MTS currently forecasts at least 6% growth for 2021 group OIBDA… 2021 cash CAPEX to be approximately 110 billion rubles including required investments under the (data retention law),” the company said.

MTS said it sees the additional investment in data storage systems necessary to comply with the data retention law at about 50 billion rubles over the five-year period through January–June 2023.

(72.5553 rubles – U.S. $1)

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