Mobile Content Russia

TELE2 Russia, Russian subdivision of European alternative telecom operator, announced its consolidated results for the fourth quarter and the full year 2008 and plans for further development of its operation. The result of year 2008 is that TELE2 Russia has GSM licenses in 35 regions with approximately 61 million inhabitants. TELE2 is operating now in 17 regions with customer base of more than 10.4 million people and will launch at least 18 new operations during 2009-2010.

For the full year 2008 customer net intake amounted to 1 858 000 (2 541 000 in full year 2007) despite the weakening economy. Operating revenue in Y2008 reached RUR 25 773 million (approx. $721 482 099) comparing to RUR 18 262 million (approx. $511 221 281) - in Y2007 The EBITDA reached RUR 8 956 million ($250 711 740) (RUR 5 793 million in Y2007). During 2008 TELE2 has invested RUR 6 584 million as CAPEX (RUR 5 820 million in 2007) which is connected with regional expansion of TELE2 Russia and necessity to roll out networks in new regions.

As of 31st of December 2008 TELE2 Russia customer base exceeded 10 422 000 customers, and it's almost 54 percent of TELE2 Group mobile subscribers. Operating revenue in Russia are about 28 percents of TELE2 Group mobile operations (as it stated in Y2008 report). During the 2008 the Krasnodar region was successfully launched and an operation in the Kaliningrad region was acquired (28th and 27th of November 2008 respectively). Also the preparatory work of rolling out the 17 new GSM licenses was done during the year.

Customer development was strong in the fourth quarter 2008 and TELE2 Russia added 484 000 (554 000 – in Q4 2007) new subscribers. ARPU grew to RUR 231 (6.47) comparing to RUR 217 in Q4 2007. The EBITDA margin was to some extent hampered in the quarter by an intensified roll-out of the 17 new GSM licenses, commercial launch of the Krasnodar region and also one-off costs related to software license and exchange losses. In the quarter TELE2 was able to further improve its market position by emphasizing its price leadership and improve network quality by the introduction of EDGE technology.

In Q4 2008 operating revenue reached RUR 7 026 million ($196 683 864) comparing to RUR 5 421 million - in Q4 2007) and EBITDA reached RUR 2 268 million (RUR 1 697 million in Q4 2007).

For more details see attached press release (PDF).