OREANDA-NEWS. September 18, 2009. Financial and Operational results for the six months ended June 30, 2009 versus six months ended June 30, 2008

·         7.3% year-on-year revenue growth reaching RUR 86.1 billion

·         4.0% year-on-year increase in net income reaching RUR 20.1 billion

·         5.3% year-on-year growth in EBITDA reaching RUR 41.6 billion

·         EBITDA margin of 48.3% for the six months ended June 30, 2009

·        Free cash flow[1] of RUR 17.7 billion for the six months ended June 30, 2009

·         45.8[2] million active mobile subscribers as of June 30, 2009

Financial and Operational results for the three months ended June 30, 2009 versus three months ended June 30, 2008

·         3.4% year-on-year revenue growth reaching RUR 43.9 billion

·         10.8% year-on-year decrease in net income to RUR 9.0 billion

·         0.6% year-on-year growth in EBITDA reaching RUR 20.7 million

·         EBITDA margin of 47.1% for the three months ended June 30, 2009

·        Free cash flow1 of RUR 7.0 billion for the three months ended June 30, 2009

Sergey Soldatenkov, Chief Executive Officer of OJSC "MegaFon", said: “We had a very good overall performance in the six months ended June 30, 2009, showing growth in financial indicators versus the corresponding period in the previous “pre-crisis” year. The first quarter of 2009 was not easy, our subscribers reduced their monthly usage and spending, and new subscriber additions slowed, but we were able to offset this by pursuing a conservative approach to costs and by efficient business management. As a result, by the end of the current period we managed to reverse the negative trends which were evident at the beginning of this year and were able, through effective marketing initiatives in the second quarter of 2009, to realize improved MOU and ARPU”. He also added “In spite of the fact that the situation in the financial markets in Russia and throughout the world still remains difficult, the Company is one of the most financially stable in Russia and possesses all necessary resources to fulfill its plans to become the leader in revenue among mobile operators in the Russian market”.

Corporate and Industry highlights of the six months ended June 30,  2009

The Company was reorganized by the merger with its subsidiaries, CJSC “Sonic Duo”, CJSC “Mobicom-Kavkaz”, CJSC “Mobicom-Center”, OJSC “MCS-Povolzhie”, CJSC “Ural GSM”, CJSC “Mobicom-Novosibirsk” and CJSC “Mobicom-Khabarovsk”. The merger was effective July 1, 2009.

At the annual shareholders meeting held in June 2009 the shareholders of the Company re-elected all of the existing members of the Board of Directors and extended the term of appointment of Sergey Soldatenkov as CEO of the Company.

In April 2009, MegaFon strengthened its team of top managers by appointing Mr. Valery Ermakov, formerly General Director of MegaFon’s Povolzhie subsidiary, as Chief Operating Officer. In addition, Mr. Tigran Pogosyan was appointed as Deputy CEO for Strategic Projects. Mr. Pogosyan will be overseeing the Company’s involvement in the 2014 XXII Olympic Winter Games in Sochi.

In May 2009, MegaFon won the Grand-prix competition “Absolute Brand - 2009”.