Moscow, Russian Federation – February 05, 2004 – Mobile TeleSystems OJSC (“MTS” - NYSE: MBT), the largest mobile phone operator in Russia and Ukraine, announces that its consolidated subscriber base reached 17.44 million users on January 31, 2004.
During January 2004, MTS’ consolidated subscriber base on a net basis increased by 717,230 subscribers of which 577,670 were added in Russia and 139,560 in Ukraine.
Commenting on the subscriber growth numbers, MTS’ First Vice-President Michael Susov said: “In December of last year the company demonstrated phenomenal growth by adding 1.46 million new customers. In January we experienced a slight slow down which is typical for this time of the year as consumer buying activity slows down and people take winter vacations. We are optimistic about growth figures for the rest of the year.”
|
|
Jan. 31 2004 |
Dec. 31 2003 |
Growth |
Jan. 31 2003 |
Growth |
Subs |
% |
Subs |
% |
|
Total consolidated subscribers,
end of period (mln) |
17.44 |
16.72 |
0.72 |
4.3% |
6.99 |
10.45 |
149.5% |
|
Russia (mln) |
13.95 |
13.37 |
0.58 |
4.3% |
6.99 |
6.96 |
99.6% |
|
Moscow and the Moscow
region (mln) |
5.06 |
4.94 |
0.12 |
2.4% |
3.24 |
1.82 |
56.2% |
|
St. Petersburg and the Leningrad region (mln) |
1.21 |
1.18 |
0.03 |
2.5% |
0.79 |
0.42 |
53.2% |
|
Rest of Russia (mln) |
7.68 |
7.25 |
0.43 |
5.9% |
2.96 |
4.72 |
159.5% |
|
Ukraine (mln) |
3.49 |
3.35 |
0.14 |
4.2% |
- |
- |
- |
|
Unconsolidated subsidiaries in Russia[1](thousand) |
124.5 |
123.1 |
1.39 |
1.1% |
- |
- |
- |
|
MTS Belarus[2](thousand) |
505.4 |
464.8 |
40.6 |
8.7% |
52.0 |
453.4 |
871.9% |
MTS also reports that its churn rate in Russia in the fourth quarter of 2003 was 12.5% and 47.3% for the full year. The management team believes that the Company’s relatively high churn rate is consistent with the general industry trend in Russia and can be largely attributed to internal migration of subscribers, the absence of term contracts and zero connection fees. The Company continues to implement programs to encourage subscriber loyalty, however, the management team does not expect a significant decline in churn rates in 2004.
Churn rate in UMC, MTS’ 100%-owned subsidiary in Ukraine, was 6.5% in the fourth quarter of 2003 and 23.8% for the full year. Churn in the Ukrainian market is lower than in Russia as UMC offers term-contracts to its customers and all mobile operators charge customers for new connections.
MTS’ financial results for the fourth quarter and full year 2003 prepared under
U.S. GAAP are expected to be announced in the first half of April 2004. Dial-in numbers for the management conference call will be circulated prior to the announcement date.
***
For further information contact:
Mobile TeleSystems, Moscow
Investor and Public Relations tel: +7095 911 6553
Andrey Braginski e-mail: ir@mts.ru
***
Mobile TeleSystems OJSC (or "MTS") is the largest mobile phone operator in Russia and Ukraine. Together with its subsidiaries, the company services over 17.4 million subscribers. The regions of Russia as well as in Belarus and Ukraine in which MTS and its subsidiaries are licensed to provide GSM services have a total population of approximately 186.3 million. Since June 2000, MTS' shares have been listed on the New York Stock Exchange with the ticker symbol MBT. Additional information about MTS can be found on MTS' website at www.mtsgsm.com.
***
Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of MTS, as defined in the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify forward looking statements by terms such as “expect,” “believe,” “anticipate,” “estimate,” “intend,” “will,” “could,” “may” or “might” the negative of such terms or other similar expressions. We wish to caution you that these statements are only predictions and that actual events or results may differ materially. We do not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. We refer you to the documents MTS files from time to time with the U.S. Securities and Exchange Commission, specifically, the Company’s most recent Form 20-F. These documents contain and identify important factors, including those contained in the section captioned "Risk Factors," that could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, potential fluctuations in quarterly results, our competitive environment, dependence on new service development and tariff structures; rapid technological and market change, acquisition strategy, risks associated with telecommunications infrastructure, risks associated with operating in Russia, volatility of stock price, financial risk management, and future growth subject to risks.
[1]MTS owns 50% stakes in Primtelefon, a local mobile operator with licenses for several Far-Eastern and Siberian regions of Russia, Volgograd Mobile and Astrakhan Mobile, local mobile operators in the Volga part of Russia. MTS does not consolidate these companies.
[2]MTS owns a 49% stake in Mobile TeleSystems LLC, a mobile operator in Belarus, which is not consolidated.
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