DJ ROSTELECOM PJSC: ROSTELECOM ANNOUNCES ITS IFRS FINANCIAL AND OPERATING RESULTS FOR THE SECOND QUARTER AND HALF YEAR 2019
ROSTELECOM PJSC (RKMD)
ROSTELECOM PJSC: ROSTELECOM ANNOUNCES ITS IFRS FINANCIAL AND OPERATING
RESULTS FOR THE SECOND QUARTER AND HALF YEAR 2019
02-Aug-2019 / 09:00 MSK
Dissemination of a Regulatory Announcement that contains inside information
according to REGULATION (EU) No 596/2014 (MAR), transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.
rostelecom announces its ifrs financial and operating results
for the second quarter and half year 2019
Q2 2019 DIGITAL SEGMENT[1] GROWTH OF 11%; 13% INCREASE IN OIBDA[2]; NET
PROFIT UP 40%
Moscow, Russia - August 2, 2019 - Rostelecom PJSC (MOEX: RTKM, RTKMP; OTCQX:
ROSYY), the largest digital service provider in Russia, today announces its
consolidated financial results for the second quarter and half year of 2019
prepared in accordance with IFRS[3].
KEY ACHIEVEMENTS
- Revenue grew by 4% year-on-year in the second quarter of 2019;
- Digital segment sales increased by 11% in the second quarter, while its
contribution to total revenue reached 57%;
- OIBDA grew by 13 % in the second quarter of 2019 to RUB 27.2 billion;
- Net profit increased by 40% and reached RUB 4.3 billion;
- Free Cash Flow (FCF) [4] increased to RUB 11.4 billion in the second
quarter of 2019.
SECOND QUARTER 2019 FINANCIAL HIGHLIGHTS
- Revenue grew by 4% to RUB 80.2 billion compared to the second quarter of
2018
- OIBDA up by 13% to RUB 27.2 billion;
- OIBDA margin grew by 2.9 p.p. to 33.9% compared to the second quarter of
2018;
- Net profit increased by 40% to RUB 4.3 billion compared to the second
quarter of 2018;
- CAPEX[5] increased by 6% to RUB 15.2 billion (19.0% of revenue) from RUB
14.4 billion (18.7% of revenue) in the second quarter of 2018;
- FCF improved to RUB 11.4 billion compared to RUB (0.8) billion in the
second quarter of 2018;
- Net debt[6] increased by 8% since the beginning of the year to RUB 201.6
billion, resulting in a Net Debt/OIBDA ratio of 1.9x.
Key figures for 2Q 2019, RUB mln
RUB million 2Q 2019 2Q 2018 change, y-o-y
Revenue 80,160 77,365 4%
OIBDA 27,162 23,983 13%
OIBDA margin % 33.9% 31.0% -
Operating Income 9,756 8,342 17%
Operating margin % 12.2% 10.8% -
Net Income 4,319 3,094 40%
% of revenue 5.4% 4.0% -
Capital Expenditure 15,243 14,442 6%
% of revenue 19.0% 18.7% -
Net debt 201,587 193,497 4%
Net debt/ annualised OIBDA 1.9 2.0 -
FCF 11,388 (832) 12,220
FIRST HALF YEAR 2019 FINANCIAL HIGHLIGHTS
? Revenue increased by 3% to RUB 158.8 billion compared to the first half
of 2018;
? OIBDA increased by 13% year-on-year to RUB 53.5 billion compared to the
first half of 2018;
? OIBDA margin grew by 2.7 p.p. to 33.7% compared to the first half of
2018;
? Net profit increased by 43% to RUB 10.0 billion compared to the first
half of 2018;
? CAPEX[7] increased by 27% to RUB 37.6 billion (23.7% of revenue) from
RUB 29.6 billion (19.3% of revenue) in the first half of 2018;
? FCF improved to RUB (3.2)[8] billion compared to RUB (6.7) billion in
the first half of 2018.
Key figures for 1HY 2019, RUB mln
RUB million 6M 2019 6M 2018 change, y-o-y
Revenue 158,827 153,568 3%
OIBDA 53,543 47,534 13%
OIBDA margin % 33.7% 31.0% -
Operating Income 19,465 16,699 17%
Operating margin % 12.3% 10.9% -
Net Income 9,950 6,958 43%
% of revenue 6.3% 4.5% -
Capital Expenditure 37,586 29,567 27%
% of revenue 23.7% 19.3% -
Net debt 201,587 193,497 4%
Net debt/ annualised OIBDA 1.9 2.0 -
FCF (3,195) (6,681) 3,486
Mikhail Oseevskiy, President of Rostelecom, commented:
"In keeping with our strategy priority, Rostelecom continues to develop its
digital segment through the expansion of our customized digital services for
different client segments.
During the second quarter, Rostelecom launched RTK Key, an outdoor video
surveillance solution for residential properties. The platform's
capabilities can be enhanced by additional services available to developers,
management companies and residents. Home video surveillance and smart
intercom, which can be controlled via a mobile application, were the first
products available on the platform. In future, the platform will be
supplemented by other solutions such as remote meter readings, a smart gate
bar, a digital key, and others as part of Rostelecom's broader plan to
introduce a comprehensive cross-vertical line up of products including
"smart household", "smart apartment building" and "smart city".
We are seeing significant demand for virtual IT infrastructure from
corporate and state companies. To ensure our cloud services offering remains
competitive, we have expanded the bandwidth allocated to the virtual
offering by 10 times to 10 Gb/s, we have significantly increased the
availability and stability of services at all data centre sites, and we have
also commenced commercial operation of an additional 800 rack spaces at the
new "Udomlya" data centre.
A good example of our strategy in action is the recent introduction of Solar
MSS to the market as an updated ecosystem of cybersecurity services, which
includes nine mutually integrated managed services. The technological core
of this ecosystem is a platform built on breakthrough technology consisting
of SD-WAN software-defined networks. The mix of technologies selected as
part of Solar MSS ensures protection against all major types of attacks,
while providing the ability to focus our offering on the most critical
segments for each individual client organization. As Russia's leading
monitoring and response centre, Solar JSOC supplements all Solar MSS
services by providing expert analytics, cyber threat alerts and proven
methods to counter hacking. During the first half of 2019, our centre
recorded and prevented over 400,000 suspected cyber-attacks, enabling us to
protect our clients' business interests. Our leading competency in the cyber
security space has led to Rostelecom being entrusted for several years with
securing the back-end infrastructure behind public Q&A sessions with
President of Russia, with all cyber-attacks successfully repelled to date.
As part of our active promotion of industrial Internet solutions, where our
digital technologies and solutions enable corporate clients to realise
efficiencies, a remote function has been launched to control SIM-cards on
devices and sensors, operated in the M2M network. This has been designed to
help businesses of all sizes to optimise their internal processes, provide
new services, reduce costs and subsequently increase revenues. Together with
LUKOIL we also launched the first smart wells in the Perm region fields, to
help monitor and manage oil and gas equipment remotely.
Our many operational achievements in the digital business segment led to
strong financial results in the second quarter of 2019. The company recorded
growth across all key indicators: revenue increased by 4%, operating profit
before depreciation grew 13%, leading to a 40% increase in net profit. In
addition, our free cash flow, which services our ability to maintain our
dividend payments to shareholders, has significantly improved.
The double-digit growth rate of our digital business points to the momentum
the Company's transformation into a reliable digital partner for the
citizens, businesses, and the State has achieved. We will continue to
implement key strategic projects, develop digital ecosystems, invest in
technological infrastructure and human capital, and we will strengthen our
leadership in providing digital services to all types of clients."
Sergey Anokhin, Senior Vice-President and Chief Financial Officer, added:
"Rostelecom's results for the second quarter of 2019 drive our confident
outlook for the future development of our digital segment and improvement of
our internal efficiency. This enables us to enhance our guidance for the
full year of 2019 on revenue and OIBDA, now we expect them to grow not less
than 3%. As for the CAPEX programme, it remains unchanged within the range
of RUB 65-70 billion, including the regulatory CAPEX amounting to RUB 7
billion, excluding the implementation of government programmes."
KEY OPERATING HIGHLIGHTS
Number of 2Q 2019 2Q 2018 change, y-o-y 1Q 2019 change,
subscribers y-o-y
(million):
Internet 13.0 13.0 0.4% 13.0 0.1%
access
B2C: Broadband 12.0 12.0 0.1% 12.0 0.01%
B2B: Broadband 1.0 1.0 4% 1.0 1%
+ VPN
Pay TV 10.2 10.0 2% 10.2 0.03%
Incl. IPTV 5.4 5.1 7% 5.4 1%
MVNO 1.3 1.0 39% 1.3 6%
subscribers
Local 16.6 18.3 (9%) 17.0 (2%)
telephony
services
ARPU[9] (RUB): 2Q 2Q 2018 change, 1Q 2019 change, y-o-y
2019 y-o-y
Internet
access
B2C: Broadband 398 380 5% 397 0.4%
B2B: Broadband 3,510 3,118 13% 3,266 7%
+ VPN
Pay TV (B2C) 248 239 4% 249 (0.5%)
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DJ ROSTELECOM PJSC: ROSTELECOM ANNOUNCES ITS IFRS -2-
Incl. IPTV 315 310 2% 317 (0.5%)
Blended 544 516 6% 543 0.2%
ARPU[10]
Total subscriber base and ARPU
1) The total number of Internet subscribers among households grew by 0.1%
to 12.0 million in the second quarter of 2019 compared to the
corresponding period of last year; ARPU was up 5% year-on-year to RUB 398.
2) The total number of B2B Internet and VPN subscribers increased by 4%
year-on-year to 1.0 million; ARPU grew by 13% year-on-year to RUB 3,510.
3) The number of pay-TV subscribers grew by 2% to 10.2 million households
compared to the corresponding period of last year with average ARPU of RUB
248, up 4% year-on-year as well;
? The number of IPTV subscribers increased by 7% to 5.4 million, and ARPU
also reached RUB 315;
4) The number of MVNO subscribers increased by 39% and reached 1.3 million
users;
5) The number of local telephony subscribers decreased by 9% to 16.6
million.
KEY EVENTS RELATING TO 2Q 2019 AND AFTER THE END OF THE REPORTING PERIOD
Business news
? Rostelecom continues to develop and expand its range of products and
services:
? A new offer "For friends" has been amended to include a new service -
Internet connection with an OTT service provided by Wink. The offering is
focused on the new "Internet for home" service subscribers, who prefer
watching TV over a range of devices rather than through a TV set;
? The Wink platform is now available via software provided to all new IPTV
subscribers across the territory covered by Rostelecom's Volga branch. By
the end of the third quarter of 2019 Rostelecom plans to provide access to
the platform to all subscribers across the country, providing current with
the option of migrating to this new offering;
? As part of the "Smart Home" ecosystem:
? A new federal platform "RTK Key" was launched; Rostelecom plans to add
new digital services for developers, managing companies and residents;
the first products to be made available on the platform will be video
surveillance of outdoor spaces and a smart intercom;
? Rostelecom has sold 100,000 cameras since the launch of the video
surveillance service for households;
? Rostelecom launched a remote control service for SIM cards used on M2M
devices and sensors;
? Within its MVNO project, the Company introduced a fully convergent offer
across all offices within the Moscow regional network; the offer is to be
launched country-wide by the end of 2019;
? Rostelecom continues to grow its digital segment:
? Rostelecom signed agreements with Nokia, Ericsson and Tele2 Russia to
jointly develop 5G lab zones on 26.5-29.5 GHz and 3.3-3.8 GHz bands in
Moscow and across a number of other cities in Russia;
? Rostelecom, Megafon and Nokia made the first international 5G video call
within Russian networks;
? Rostelecom and Lukoil launched the first smart wells in the fields of
the Perm region; the wells are equipped with tools for oil & gas equipment
remote monitoring and control;
? As part of cybersecurity services:
? the largest Russian centre for information security monitoring and
response to incidents recorded over 400,000 cyber-attacks in the first
half of 2019;
? Rostelecom launched Solar MSS, Russia's largest ecosystem of cyber
security services which supports Russian organisations on their path to
digital transformation;
? Rostelecom successfully repelled cyber-attacks during the President's
public Q&A session;
? Rostelecom expanded the functionality of its DDoS attacks service; it
is now available to a wider range of organisations, thanks to the
application of SD-WAN technologies;
? Rostelecom continues to grow its cloud services segment:
? As part of the Virtual PBX offering, Rostelecom:
? increased revenues by 60% in the second quarter of 2019;
? expanded global reach to 363 cities;
? launched a call-back option;
? finalised integration with the '1? Enterprise Management'
infrastructure;
? launched a pilot speech recognition project for the virtual PBX
across the territory covered by its three cross-regional branches;
? As part of the Virtual Data Centre offering, Rostelecom:
? increased the number of virtual machines by 36% in the second
quarter of 2019;
? expanded the bandwidth between virtual machines by 10 times to 10
Gb/s,
? started commercial operation of 800 rack spaces at the new Udomlya
Data Centre;
? launched sales of the service as a White Label product;
? switched to the Vmware NSX platform at all data centres in order to
improve the reliability and accessibility of its service.
? Rostelecom signed a number of large contracts to provide communication
services with Sberbank (for RUB 759 million), Rusagro (for RUB 155
million), Transneft (for RUB 150 million), Magnit (for over RUB 50
million) and others;
? Rostelecom successfully provided video surveillance for the 2019 Unified
State Exam, with more than 4.5 million hours of surveillance captured;
? Rostelecom delivered a two-fold growth of revenues from its O2O[11]
project in the first half of 2019; by the end of the reporting period the
Company had serviced more than 146,000 km of fiber-optic communication
line and 62,000 base stations of third-party operators;
? More than 30% of Rostelecom's partner operators were given dedicated
access to Rostelecom online accounts to help improve transparency and
efficiency in their communication;
Other news
? Rostelecom's shareholders approved the Company's dividends for 2018 at
RUB 2.5 per share; taking into account interim dividends for the 9 months
of 2018, the total dividend payout amounts to RUB 13.9 billion for the
full year of 2018 or RUB 5.0 per share.
? The Board of Directors of Rostelecom approved a revised dividend policy
to amend the FCF methodology for dividends calculation. The amended FCF
has been increased by subsidy from government;
? Rostelecom and Mail.ru signed an agreement for a strategic partnership
in the development of e-education in Russia;
? Rostelecom and LSR Group signed an agreement to promote digital
technologies in the construction industry in Russia;
? Central Telegraph PJSC, Rostelecom's subsidiary, put up for sale its
properties with an area of 35,198.7 square meters at 7, Tverskaya street,
Moscow,;
? Rostelecom acquired Prometey, an internet provider in St. Petersburg;
? The Analytical Credit Rating Agency (ACRA) assigned an AA(RU) credit
rating to Rostelecom.
OPERATING REVIEW
Revenue analysis
Revenue structure by services
RUB million 2Q 2019 2Q 2018 change 6M 2019 6M 2018 Change
Broadband 20,460 19,653 4% 41,398 38,836 7%
TV services 9,262 8,488 9% 18,555 16,663 11%
Fixed telephony 15,385 17,717 (13%) 31,473 36,000 (13%)
Wholesale services 21,059 19,395 9% 41,446 38,794 7%
Rent of channels 2,371 2,386 (1%) 4,758 4,682 2%
Interconnect and 7,944 7,913 0% 16,379 16,288 1%
traffic transit
services
VPN 7,244 5,723 27% 13,344 11,247 19%
Rent and 3,500 3,374 4% 6,966 6,577 6%
maintenance of
telecommunications
infrastructure
VAS and cloud 8,925 7,470 19% 16,578 14,707 13%
services
Other 3,247 2,836 14% 6,064 5,446 11%
telecommunications
services
Other 1,823 1,805 1% 3,314 3,122 6%
non-telecommunicat
ions services
Total 80,160 77,365 4% 158,827 153,568 3%
Revenue structure by customer segments
RUB million 2Q 2019 2Q change 6M 6M2018 change
2018 2019
Residential 34,802 34,361 1% 70,049 68,447 2%
customers
B2B / State clients 30,246 28,179 7% 58,177 55,253 5%
Operators 14,040 13,704 2% 28,442 27,690 3%
Other 1,072 1,122 (4%) 2,159 2,179 (1%)
Total 80,160 77,365 4% 158,82 153,568 3%
7
In the second quarter of 2019, revenue increased by 4% to RUB 80.2 billion,
compared to the second quarter of 2018, as a result of the following
factors:
? a 27% increase in revenue from VPN services, mainly due to higher demand
from state and corporate clients;
? a 19% increase in revenue from VAS and cloud services, mainly due to the
proceeds from "Smart City" projects, the promotion of cloud services and
data centres;
? a 4% increase in revenue from broadband services due to a higher number
of subscribers and higher ARPU;
? a 9% increase in revenue from pay-TV services due to growth in the IPTV
subscriber base and higher ARPU;
During the first six months of 2019, revenue increased by 3% to RUB 158.8
billion, compared to the first six months of 2018, as a result of the
following factors:
? a 7% increase in revenue from broadband services due to a higher number
of subscribers and higher ARPU;
? a 19% increase in revenue from VPN services, mainly due to higher demand
from state and corporate clients;
? an 11% increase in revenue from pay-TV services due to growth in the
IPTV subscriber base and higher ARPU;
? a 13% increase in revenue from VAS and cloud services, mainly due to the
proceeds from "Smart City" projects, the promotion of cloud services and
data centres;
Operating income analysis
Operating expenses structure
RUB million 2Q 2019 2Q 2018 change 6M 6M change
2019 2018
Personnel costs (24,761) (24,130) 3% (50,0 (48,6 3%
71) 15)
Depreciation, (16,190) (14,397) 12% (31,6 (28,4 11%
Amortization and 96) 75)
impairment
losses
Interconnection (14,715) (13,632) 8% (28,9 (27,7 4%
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charges 48) 76)
Materials, (5,829) (6,057) (4%) (12,2 (12,3 (1%)
repairs and 98) 95)
maintenance,
utilities
Gain on the 767 976 (21%) 1,424 1,394 2%
disposal of PPE
and intangible
assets
Impairment loss (1,032) (1,851) (44%) (2,15 (3,12 (31%)
of financial 3) 6)
assets measured
at amortized
cost
Other operating 4,425 3,429 29% 8,224 7,014 17%
income
Other operating (13,069) (13,361) (2%) (23,8 (24,8 (4%)
expenses 44) 89)
Total operating (70,404) (69,023) 2% (139, (136, 2%
expenses 362) 869)
In the second quarter of 2019, operating expenses increased by 2% compared
to the corresponding period of 2018 and amounted to RUB 70.4 billion,
largely due to the following factors:
? a 12% increase (of RUB 1.8 bln) in depreciation, amortization and
impairment losses, due to a reduced effect from revised terms of useful
life and higher payments associated with new objects and intangible assets
following the acquisition of additional software and content;
? an 8% increase (of RUB 1.1 bln) in interconnection charges, mainly due
to sub-contractual payments to other operators as part of the state
contracts, contributing to the increase in corresponding revenues;
? a 3% increase (of RUB 0.6 bln) in personnel costs, mainly due to an
increase in the number of employees within the digital business segments;
? a 29% increase (of RUB 0.9 bln) in other operating income, due partly to
the increased proceeds as part of the "Bridging the digital divide"
project;
? a 44% decrease (by RUB 0.8 bln) in impairment loss of financial assets
measured at amortized cost, due partly to the high base effect of 2018
driven by significant one-off accruals.
During the first six months of 2019, operating expenses increased by 2%
compared to the corresponding period of 2018 and amounted to RUB 139.4
billion, largely due to the following factors:
? an 11% increase (of RUB 3.2 bln) in depreciation, amortization and
impairment losses, due to a reduced effect from revised terms of useful
life and higher payments associated with new objects and intangible assets
following the acquisition of additional software and content;
? a 3% increase (of RUB 1.5 bln) in personnel costs, mainly due to an
increase in the number of employees within the digital business segments,
including through the acquisitions of subsidiary companies;
? a 4% increase (of RUB 1.2 bln) in interconnection charges, partly due to
sub-contractual payments to other operators as part of the state
contracts, contributing to the increase in corresponding revenues;
? a 17% increase (of RUB 1.2 bln) in other operating income, partly due to
the increased proceeds as part of the "Bridging the digital divide";
? a 4% decrease (by RUB 0.8 bln) in other operating expenses, namely due
to the legislative amendments to corporate property tax, as well as high
base of marketing and advertising costs in 2018;
? a 31% decrease (by RUB 1.0 bln) in impairment loss of financial assets
measured at amortized cost, partly due to the high base effect of 2018
driven by significant one-off accruals.
Operating profit in the second quarter and six months of 2019 increased by
17% year-on-year to RUB 9.8 billion and RUB 19.5 billion respectively,
compared to the corresponding periods of 2018.
OIBDA for the second quarter and six months of 2019 increased by 13%
year-on-year to RUB 27.2 billion and RUB 53.5 billion respectively. OIBDA
dynamics were driven by revenue growth and the above-mentioned factors,
affecting operating expenses. The OIBDA margin increased by 2.9 p.p. to
33.9% in the second quarter of 2019 compared to the corresponding period of
2018. The OIBDA margin increased by 2.7 p.p. to 33.7% during the first six
months of 2019 compared to the corresponding period of 2018.
Net Income Analysis
In the second quarter of 2019, profit before tax increased by 28% to RUB 5.8
billion, compared to the corresponding period in 2018, and by 35% to RUB
12.7 billion in the six months of 2019.
These dynamics were influenced in the second quarter of 2019 by the
following factors:
? higher operating profit;
? no foreign exchange losses in the reporting period;
? improved associated companies' financial results, mainly from the joint
venture with Tele2 Russia;
? higher finance costs, partly due to an increase in interest payments.
These dynamics were influenced during the first six months of 2019 by the
following factors:
? higher operating profit;
? improved associated companies' financial results, mainly from the joint
venture with Tele2 Russia;
? foreign exchange gains in the reporting period due to strengthened
national currency;
? higher finance costs, including due to an increase in interest payments;
Income tax in the second quarter of 2019 increased by 3% to RUB 1.5 billion,
and by 11% in the six months of 2019 to RUB 2.7 billion.
The effective income tax rate was at 26% in the second quarter of 2019, and
21% in the six months of 2019, compared to the 20% rate set by the Tax Code.
Net profit increased by 40% in the second quarter of 2019 and totalled RUB
4.3 billion, compared to the corresponding period last year, and in the six
months of 2019 - by 43% to RUB 10.0 billion.
Financial review
Net operating cash flow in the second quarter of 2019 almost doubled and
amounted to RUB 23.1 billion, compared to the corresponding period of 2018.
The increase in net operating cash flow in the second quarter of 2019 was
mainly due to the increased operating flow due to the change in the working
capital, which was mainly driven by a bigger decrease in accounts receivable
due to the receipt of payments for the provision of high-speed Internet
connection to healthcare centres in Russia. Net operating cash flow in the
six months of 2019 increased by 48% and amounted to RUB 29.6 billion,
compared to the corresponding period of 2018. The increase in net operating
cash flow in the six months of 2019 was mainly due to the increased
operating flow due to the changes in the working capital, which were mainly
driven by the collection of receivables in the second quarter of 2019.
Cash outflow for investments in non-current assets increased by 6% to RUB
15.2 billion (19.0% of revenue) in the second quarter of 2019. Excluding
state programmes, it decreased by 4% to RUB 11.5 billion (14.4% of revenue).
Cash outflow for investments in non-current assets increased by 27% to RUB
37.6 billion (23.7% of revenue) in the six months of 2019. Excluding state
programmes, it increased by 14% to RUB 27.9 billion (17.6% of revenue).
These dynamics reflect an increase in capital expenditure on
government-funded programmes during the reporting period, as well as the
uneven distribution of expenditure during a calendar year according to the
terms of the concluded contracts.
Free cash flow in the second quarter of 2019 increased by RUB 12.2 billion
and totalled RUB 11.4 billion compared to RUB (0.8) billion in the second
quarter of 2018. Free cash flow in the six months of 2019 increased by RUB
3.5 billion and totalled RUB (3.2) billion compared to RUB (6.7) billion in
the six months of 2018.
Free Cash Flow (RUB, billion)
As at June 30, 2019, the Group's total debt increased by 5% compared to the
beginning of the year and amounted to RUB 215.1 billion. Over 99% of the
Group's total debt was rouble-denominated as at June 30, 2019.
As at June 30, 2019, the Group's net debt increased by 8% compared to the
beginning of the year and amounted to RUB 201.6 billion. The net debt /OIBDA
ratio over the last 12 months stood at 1.9x as at 30 June 2019.
OTHER INFORMATION: CONFERENCE CALL
Rostelecom's management will hold a conference call and webcast today at
3.00 PM (Moscow), 2.00 PM (CET), 1.00 PM (UK) and 8.00 AM (NYT). To
participate in the conference call, please dial:
UK/ International: +44 (0) 330 336 9411
USA: +1 323-994-2082
Russia: +7 495 646 9190
Confirmation Code (ENG): 8370399
Confirmation Code (RUS): 9812008
A webcast of the conference call will only be available in English. To
access the webcast please follow the link:
https://webcasts.eqs.com/rostelecom20190802/ [1]en.
A replay of the conference call will be available on the Company's website
https://www.company.rt.ru/ir/results_and_presentations/financials/IFRS/2019/
2 [2]
* * *
APPENDICES
1) Reconciliation of OIBDA;
2) IFRS 9, 15 and 16 standards application;
3) Statement of Comprehensive Income for the six months of 2019;
4) Statement of Cash Flows for the six months of 2019;
5) Statement of Financial Position for the six months of 2019.
APPENDIX 1: RECONCILIATION OF OIBDA
OIBDA is a non-U.S. GAAP and non-IFRS financial measure, which the Company
defines as operating income before depreciation and amortisation as well as
some certain expenses. We believe that OIBDA provides useful information to
investors because it is an indicator of the strength and performance of our
business operations, including our ability to finance capital expenditures,
acquisitions and other investments and our ability to incur and service
debt.
The following indicators are not taken into account in the calculation of
OIBDA:
? Expenses related to the long-term management incentive programme,
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