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Russia’s MTS ignores Ukraine as it reports revenue up 8%

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Russian operator Mobile TeleSystems (MTS) ignored the effects of Russia’s war on Ukraine this morning as it reported its fourth quarter and full-year results

Russian operator Mobile TeleSystems (MTS) ignored the effects of Russia’s war on Ukraine this morning as it reported its fourth quarter and full-year results.

The only reference to Ukraine, which Russia invaded a week ago, was to show the proceeds of its sale of Vodafone Ukraine. That deal, in which MTS sold its Ukraine operation to NEQSOL Holding in 2019, now seems well timed by the Russian company.

MTS’s accounts show that it made a 2.1 billion rouble gain from the Ukraine sale in the 2020 financial year, and a 54 million rouble loss in 2021 (now only US$490,000).

MTS’s shares were traded on the New York Stock Exchange (NYSE), but it is one of a number of Russian companies whose shares have been frozen on the NYSE and NASDAQ this week following the attack on Ukraine – along with those of Veon and Yandex.

In the annual results, president and CEO Viacheslav Nikolaev said: “2021 was landmark year for MTS as we accelerated our progress in priority directions – most notably deepening engagement across our expanding digital ecosystem.”

He said that group revenue increased 8.0% in 2021 to reach 534.4 billion roubles ($4.85 billion at today’s exchange rate). “Overall, I am happy to report we delivered a robust set of financial results from the top to the bottom line,” said Nikolaev.

Meanwhile rival operator, Amsterdam-based Veon, which owns the Beeline mobile network in Russia, has put out “an update on its current liquidity position”, saying that it has enough money to carry on.

Russia represents about half of the group’s business, and Veon faces the challenge of losing access to the earnings of Beeline in Russia.

Mikhail Fridman, whose investment company LetterOne is the biggest shareholder, quit from the Veon board on Tuesday.

Veon has approximately $2.1 billion of cash and deposits, in dollar and euro accounts in Amsterdam. The money is “held in bank accounts, money market funds and on-demand deposits at a diversified group of international banks from the European Union, the United States and Japan”, said the company, which said it also has a “$1.250 billion committed revolving credit facility”.

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