Mobile TeleSystems (MTS) has reported consolidated group revenue of RUB98.9 billion (USD2.7 billion) for the second quarter of 2014, an increase of 1.4% from RUB97.5 billion in the year-ago period, with growth mainly driven by a 6.3% rise in Russian mobile service revenue to RUB70.9 billion. Domestic data traffic revenue jumped 39.7% year-on-year to RUB15.3 billion in 2Q14, spurred by greater adoption of data plans as smartphone penetration reached 37%, while fixed line turnover slipped 1.0% year-on-year to RUB15.6 billion. Despite volatile operating conditions, revenue in Ukraine grew 2.2% in local currency to UAH2.6 billion as MTS expanded its subscriber base, although turnover from Armenia fell 4.8% year-on-year. As at 30 June 2014 MTS reported a total of 110.12 million customers (up 1.3% quarter-on-quarter), including 77.27 million in Russia and 23.07 million in Ukraine.
Consolidated group OIBDA declined 2.6% from RUB44.4 billion in 2Q13 to RUB43.2 billion a year later; net of a one-off gain related to compensation for the settlement of Bitel, OIBDA fell by 0.6%. The decline was mainly attributed to macroeconomic factors impacting MTS’s business in Ukraine and greater general and administrative expenses due to the rollout of its mobile and fixed networks in Russia. Net income attributable to the group totalled RUB21.1 billion in the second quarter of 2014, compared to RUB29.0 billion in the year-ago quarter. ‘While we expect Russia still to grow at the high end of our initial guidance of 3%-5%, developments in Ukraine will limit group growth to at least 1% in revenue for 2014,’ MTS CEO Andrei Dubovskov commented.