OREANDA-NEWS. October 27, 2009. Ukrtelecom (UTLM) reported its 9M09 financial results yesterday in a company filing: net revenues rose 1.9% yoy to UAH 5.0 bln, EBITDA by 29% yoy to UAH 2.1 bln, and its net loss dropped 37.8% yoy to UAH 194.8 mln. In 3Q09, Ukrtelecom's net revenues rose 4% yoy to UAH 1.7 bln, gross profit by 2.6x yoy to UAH 465.7 mln, and net loss dropped 3x yoy to UAH 70.7 mln.

Concorde Capital: Ukrtelecom improved its EBITDA by 6 pp qoq to 48% in 3Q09. The increase was driven by cost reduction, which resulted in a gross margin of 28% vs. its 19% average in 2007-1H09. However, the company's EBITDA improvement was eroded by revaluation of its foreign denominated debt (loss of ~UAH 135 mln) due to hryvnya depreciation during the quarter. Also, the company paid most of its 2H09 interest in the third quarter; Ukrtelecom's interest payments are due semiannually in the first and third quarters (UAH 116 mln vs. UAH 34 mln in 2Q09). We expect a positive reaction from the stock market to Ukrtelecom's improved cost efficiency.

Concorde Capital is a full service investment bank operating on the Ukrainian, Russian and CIS markets. In 2007 Concorde Capital’s analytical team was recognized as the Top Team covering Ukraine by Thomson Extel's Pan European Survey. Senior Analyst Alexander Paraschiy was recognized as the Leading Pan-European Investment Analyst – European Emerging Markets. Concorde Capital is a leader when it comes to private placements and M&A deals. Concorde Capital’s sale of a stake in Electron Bank to Volksbank International AG was named the Best Ukrainian M&A deal of the year 2007 by the Adam Smith Institute.