UPDATE:VimpelCom 2Q Net +31%;Gets Russia's First iPhone Deal
MOSCOW -(Dow Jones)- Russian telecoms operator VimpelCom Thursday reported a sharp rise in second-quarter profits and said it would become the country's first operator to offer Apple Inc's (AAPL) popular iPhone.
New York-listed VimpelCom, part-owned by Norway's Telenor, said it would begin supplying the latest 3G iPhone, which is suitable for use with third-generation mobile networks, by the end of 2008.
While iPhones have been widely-available in Russia on an unofficial basis for some time - currently costing upwards of $600 - the firm is the first of Russia's three largest cellular providers to seal a deal with Apple.
Like rivals Mobile TeleSytems (MTS) and MegaFon, VimpelCom is in the process of building a countrywide 3G network capable of providing high-speed Internet and mobile television.
All three operators will eventually offer the iPhone, Russian media have reported.
VimpelCom said net profit under U.S. Generally Accepted Accounting Principles rose 31% between April and June as it fully consolidated wireline carrier Golden Telecom and saw strong usage growth in its core market.
The country's second largest operator by customers said net income reached $470 million from $359 million a year earlier, bang in line with a Dow Jones Newswires poll of five analysts estimates.
Revenue advanced to $2.61 billion from $1.72 billion as VimpelCom signed up six million new mobile users and existing clients in its core domestic market spent 20% more on average a month.
"The increase in revenue was driven by fast organic growth in both our mobile and fixed-line operations as well as by the first full quarter consolidation of Golden Telecom," said Chief Executive Alexander Izosimov.
VimpelCom's stock has shed almost half of its value since December 2007, amid investors' concern that Russian mobile usage growth will slow from the rate seen in 2007.
The share price fall has recently been aggravated by wider concerns about the business environment in Russia.
-By Will Bland and Andrew Langley, Dow Jones Newswires; william.bland@dowjones.com; +7 495 937 8445
(END) Dow Jones Newswires
Posted to the site on 28th August 2008
