VimpelCom » reported for 2007. Its revenue increased by 47.3% to $7.17 billion (in 2006 +51.6%), OIBDA – by 46.7% to $3.6 billion (in the previous year +56%), and net profit – by 80.2% to $1.46 billion (+32%). But analysts were disappointed by the fourth quarter: OIBDA and profitability for this indicator turned out to be significantly lower than the consensus forecast of experts polled by Reuters (see chart).

Megafon previously promised to increase investments in 2008 by 31% to $1.7 billion. MTS investments for 2007 were about $2 billion; the operator has not yet shared its forecast for this year.

OJSC VimpelCom

cellular operator. Serves 51.9 million subscribers in Russia, Kazakhstan, Uzbekistan, Tajikistan, Georgia, Armenia and Ukraine. Shareholders: Altimo, which manages the telecommunications business of Alfa Group (44% of voting shares) and Norway's Telenor (29.9%), 24.5% in free float. Financial indicators for 2007: Revenue - $7.17 billion. OIBDA - $3.6 billion. Net profit - $1.46 billion. Capitalization as of March 12 - $33.34 billion.

VimpelCom Executive Vice President Nikolay Pryanishnikov explained this by the growth of accruals related to possible payments under option programs: the size of potential payments is related to the market value of the company's securities, and they rose sharply in price in the fourth quarter. As a result, accruals amounted to $118.7 million - $78.2 million more than the quarter before, and $94.5 million more than in the fourth quarter of 2006. If not for this, the quarterly OIBDA profitability would have exceeded 50%, Pryanishnikov assures.

By 20:30 Moscow time, the price of ADRs on VimpelCom shares had fallen by 5.44%.

Another surprise was VimpelCom's plan to increase investments. This year, the company's CEO Alexander Izosimov said, they will grow 1.5 times to $2.7 billion. This amount does not include possible acquisitions, but includes the Golden Telecom (GT) investment program and investments in 3G.

In 2007, GT predicted that its capital expenditures for the year would be 20% of revenue, and that revenue would increase by at least 45%. Under these circumstances, GT's capital expenditures in 2007 were expected to be about $248 million. If we add them to VimpelCom's capital expenditures last year, it turns out that the companies' combined investments will increase by 33% this year.

Uralsib expected that joint investments by GT and VimpelCom in 2008 would amount to $2.3 billion, says its analyst Konstantin Belov. But VimpelCom has a large free cash flow (see chart), and there will be no problems with financing the investment program, he is sure.

Depreciated by $1.96 billion