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UPDATE 1-Russia's MTS posts flat Q1 net profit, keeps guidance
May 27, 2014 / 9:35 AM / 3 years ago

UPDATE 1-Russia's MTS posts flat Q1 net profit, keeps guidance

* Q1 net profit at 13 bln roubles vs 13.5 billion forecast

* Revenues, core profit just above FY 2014 guidance

* Confirms targets, could revise later (Adds CFO comment, details)

MOSCOW, May 27 (Reuters) - Russia’s biggest mobile phone operator MTS said on Tuesday its first-quarter net profit was almost unchanged from the same year-ago period, slightly missing estimates.

The company confirmed full-year targets as first-quarter revenues and core profit grew ahead of the guided range but did not rule out a revision later because of economic volatility and currency depreciation in Russia and Ukraine, its key markets.

“We are not changing guidance for now. There will be an impact but it’s very early to talk about how it may affect annual results,” chief financial officer Alexei Kornya told reporters, when asked about the impact from a weaker economy.

MTS reported a net profit of 13 billion roubles ($380 million) for the first three months of 2014 compared with 12.96 billion a year ago, while analysts had on average expected a profit of 13.5 billion roubles.

Revenues rose 5.1 percent to 97.6 billion roubles, above the average forecast of 97 billion in a Reuters poll and just ahead of the company’s 3-5 percent target.

Its Russian mobile revenues rose 7.2 percent, year-on-year, helped by growing data traffic while in Ukraine its revenues edged up 1.4 percent, MTS said in a statement.

MTS, part of oil-to-telecoms conglomerate Sistema, also said its operating income before depreciation and amortisation (OIBDA) grew 5.3 percent to 41.5 billion roubles, above the 41.2 billion poll figure and the company’s guidance for 2 percent growth in 2014 as a whole.

The company’s chief executive Andrei Dubovskov told Reuters last week that he did not see any serious risk to MTS’s business from Russia’s economic slowdown or from Western sanctions imposed on Moscow over the Ukraine crisis.

The European Union and the United States have imposed sanctions on some individuals and businesses considered close to President Vladimir Putin over Russia’s annexation of the Crimea region from Ukraine in March. ($1 = 34.1780 Russian Roubles) (Reporting by Anastasia Teterevleva and Maria Kiselyova; Editing by Megan Davies/Ruth Pitchford)

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