The decline in MegaFon’s net profit is related to non-monetary factors, the company’s CFO Gevork Vermishyan told Kommersant FM. Today the operator reported its Q2 results. MegaFon’s net profit was just over 7 billion rubles, a year-on-year decline of 44%. In spite of this, the company’s “physical” numbers have improved, noted CFO Gevork Vermishyan.
“We are focusing on increasing the number of “quality” subscribers. Our subscriber base in Russia has risen 4.6%. And more importantly, the rise in subscribers using data services was 7.4%. This has been reflected in revenue, which has moved away from the stagnation of 2015. Consolidated revenue is growing at 3.4%. Within that, the fixed segment is growing well at a significant pace of 18%, while revenue from device sales was up a huge 78%. Revenue from hardware is more dictated by the recovery in consumer demand on the Russian market. The company’s net profit did indeed decline. In Q2 it was down. Due to changes in the revenue structure, i.e. more toward to the low-margin segment of hardware sales, we know that the margin on the mobile retail market is significantly lower than the mobile margin. At the same time, we have to note that there were several non-monetary factors affecting our reporting, linked to the revaluation of Evroset and the transfer of provisions for tax payments in Tajikistan. The company’s net debt is falling, which is positive and reflects our financial strength.”
I would add that in July and August MegaFon will pay shareholders 35 billion rubles in dividends. The board of directors also intends to consider an interim payment for shareholders.
Source: Kommersant FM