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Vimpelcom cuts outlook as revenues fall 10% in Q1
2014-05-14 09:19:00| Telecompaper Headlines
(Telecompaper) Vimpelcom lowered its full-year outlook after reporting a weak set of first-quarter results. The company now expects a low to mid single digit decline in revenue and EBITDA this year, after previously forecasting stable results. As a result, net debt will be around 2.4x EBITDA, versus an earlier target fo 2.3x. Capital expenditure is expected to remain high, at 21 percent of revenue excluding licences. In the first quarter, revenue fell 10 percent year-on-year to USD 5.02 billion, hurt by negative currency effects and the difficult market conditions in Ukraine. On an organic basis, revenue was down 6 percent in Russia, 7 percent in Italy and Ukraine, and 1 percent in Africa and Asia, while growing 3 percent in the CIS states. Vimpelcom said it expects market conditions to remain difficult this year in its two largest markets, Russia and Italy. Group EBITDA fell 11 percent to USD 2.09 billion, and net profit plunged to USD 39 million from USD 408 million a year ago. Vimpelcom increased capex 24 percent to USD 736 million in Q1, while operating cash flow fell 23 percent to USD 1.35 billion. The group's mobile customer base was still up 3 percent year-on-year to 218 million, and all the business units posted double-digit growth in data revenues.
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Category:Telecommunications