OREANDA-NEWS. OJSC CenterTelecom (OTC: CRMUY.PK; MICEX: CTLK, CTLKP; RTS: ESMO, ESMOP), major provider of fixed-line telecommunications services in the Central Federal District of Russia, today announced its financial results in accordance with Russian Accounting Standards (RAS) for the first nine months of 2007, including a 64.14% rise in net profit.

• Revenues for ordinary activities (RUR bln) 23.781, Changes (%) -  16.12
• Including revenues from
• telecommunications services  (RUR bln) 22.621, Changes (%) - 18.20
• Costs for ordinary activities (RUR bln) 16.87,   Changes (%)   -   8.14
• EBITDA (1) 9.218,   Changes (%) - 19.89
• EBITDA margin (2) 38.76%
• Sales profit 6.912, Changes (%) - 41.64
• Net profit 3.158, Changes (%) - 64.14  

1) EBITDA is calculated as earnings before taxes plus interest payable plus depreciation plus leasing payment minus interest receivable;
2) EBITDA margin is calculated as EBITDA/revenues.


Characteristics of operational efficiency
The number of telecommunications lines per employee rose 18.6% to 129 lines (108.7 lines for 9M2006).
Revenue per line rose 14.1% for the first nine months of 2007 – from RUR3,101 in 9M2006 to RUR3,536.8 in 9M2007.
Revenue per employee for the first nine months of 2007 reached RUR456.1ths; 35.3% more than in 9M2006 (RUR337,1ths).
Personnel numbers were reduced by 12.3% to 52,949 employees (60,383 in 9M2006).
Net margin reached 13.3% ( 9.4% in 9M2006).

The number of broadband Internet users under the DOMOLINK brand rose by 104.4% in January-September 2007 and reached 235,161 users (compared with 115,052 as of 31 December 2006). The share of income from Internet access services rose to 8.9% (6.54% in January-September 2006).
Number of fixed line communications service subscribers increased by 1.56% in 9M2007 and reached 6,604,260 subscribers (6,502,897 as of 1 October, 2006). 
For the first nine months of 2007 implementation of the “calling party pays” rule generated income growth from inter-zone communications of 70.59 % and reached RUR4.237 billion (RUR2.484 billion in 9M 2007).

Growth of other expenditures of CenterTelecom for the first nine months of 2007 is connected with growth of expenditures related to non-state pension coverage, payments into the universal servicing reserve and also by a rise in payments for other telecommunications operators’ services. 
 
Commenting on the 9M 2007 RAS results, Alexander Lutsky, Deputy General Director – Financial director of CenterTelecom, said that CenterTelecom is maintaining its dynamic rate of development. “Sustainable growth of the figures confirming the company’s economic efficiency is a result of CenterTelecom’s managers’ and employees’ systematic work on improvement of the company’s management system and organization of business processes. Strict control over expenditures and successful implementation of the company’s strategic development plans as well as dynamic improvement of the company’s basic indicators allow us to state that there is a possibility of increase of CenterTelecom’s economic activities’ figures for 2007 in comparison with the management’s forecasts published in January 2007.”