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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 6-K

 

 

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16 under

the Securities Exchange Act of 1934

For the month of December 2010

Commission File Number 1-14522

 

 

Open Joint Stock Company “Vimpel-Communications”

(Translation of registrant’s name into English)

 

 

10 Ulitsa 8-Marta, Building 14, Moscow, Russian Federation 127083

(Address of principal executive offices)

 

 

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F  x            Form 40-F  ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):     .

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):     .

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes  ¨             No  x

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-                    .

 

 

 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

				OPEN JOINT STOCK COMPANY
				“VIMPEL-COMMUNICATIONS”
				(Registrant)
Date: December 2, 2010
				By:		/S/    ELENA SHMATOVA
				Name:		Elena Shmatova
				Title:		General Director

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Amsterdam and New York (December 2, 2010) - “VimpelCom Ltd” (“VimpelCom” or the “Company”) (NYSE: VIP), a leading international provider of telecommunications services, today announced its operating and financial results for the quarter ended September 30, 2010.

Third Quarter Highlights:

 

•

Number of mobile subscriptions increased to 92.0 million (up 40.7% y-o-y); broadband subscriptions grew to 3.1 million (up 58.8% y-o-y)

 

•

Net operating revenues increased by 24.1% y-o-y to $2.8 billion

 

•

Adjusted OIBDA* reached $1.4 billion (up 20.0% y-o-y); consolidated OIBDA margin was 48.8%

 

•

Net income attributable to VimpelCom Ltd was $495.9 million (up 14.1% y-o-y)

 

•

Net cash from operating activities was $1,096.8 million (up 3.1% y-o-y)

 

•

Capex was $520.1 million and year-to-date Capex was $1,080.9 million

 

•

Net debt during the quarter increased by $46 million primarily as a result of payment for the OJSC VimpelCom squeeze out, partially offset by cash generated by operating activities

Recent Developments:

 

•

The Ukrainian Anti-Monopoly Committee confirmed its prior approval of the transaction to combine OJSC VimpelCom and Kyivstar GSM under VimpelCom Ltd

 

•

VimpelCom Group issued ruble bonds with five-year maturity in the amount of approximately $658 million to refinance its US dollar denominated debt

 

•

Commercial launch of 3G networks in Kazakhstan and Kyrgyzstan

 

•

Signed an agreement to combine VimpelCom and Weather to create a new global telecom group

 

•

The Supervisory Board of VimpelCom Ltd declared the payment of an interim dividend in 2010 of US$0.46 per American depositary share

 

*	Hereafter Adjusted OIBDA is referred to as OIBDA and Adjusted OIBDA margin is referred to as OIBDA margin (See definitions of Adjusted OIBDA and Adjusted OIBDA margin in Attachment A)

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VimpelCom Ltd - Third Quarter 2010 Operating and Financial Results

 

Consolidated Financial Results^*

 

CONSOLIDATED OPERATIONS (US$, millions)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			2,824.4				2,275.8				24.1	%			2,641.6				6.9	%
Adjusted OIBDA			1,377.7				1,148.3				20.0	%			1,261.8				9.2	%
Adjusted OIBDA margin, %			48.8	%			50.5	%							47.8	%
SG&A			799.1				599.2				33.4	%			766.4				4.3	%
SG&A percentage			28.3	%			26.3	%							29.0	%
Net income attributable to VimpelCom Ltd.			495.9				434.5				14.1	%			334.7				48.2	%
Net income attributable to VimpelCom Ltd. per ADS, basic (US$)			0.39				0.44								0.28
Net cash from operating activities			1,096.8				1,064.1				3.1	%			1,000.9				9.6	%
Capital expenditures			520.1				123.2				322.2	%			381.4				36.4	%
ROCE, %			21.5	%			19.8	%							22.7	%

Commenting on the results, VimpelCom’s Chief Executive Officer, Alexander Izosimov, said, “Our third quarter results reflect the macroeconomic situation in the countries where we operate, consolidation of Kyivstar and seasonal effects typical for the summer period. Our quarterly revenues reached $2.8 billion, while the OIBDA margin remained in the high 40’s. Our focus on profitability and cash flow generation helped to substantially increase net income, while keeping ROCE above 20%. The strength of our cash flows allowed us to declare a sizeable interim dividend of $600 million.

Our increased scale and financial strength position us well to capture opportunities and strategic benefits of industry consolidation. Our recently announced agreement with Weather Investments is a significant step in this direction. Given the size and complexity of the transaction, we are satisfied with the progress made thus far. We remain committed and continue to move forward as outlined in our October 4th announcement. We are working towards fulfilling all necessary conditions precedent, including obtaining approval of VimpelCom’s Supervisory Board and securing the necessary regulatory approvals and anticipate the closing in the first half of 2011.

Mr. Izosimov continued, “However, while scale is an important strength in a rapidly evolving telecom industry, it is critical to sustain competitive positions in the core markets. We are clearly dissatisfied with our recent loss of market share in the Russian mobile market. The new management team in Russia already started to implement a set of measures to regain momentum in our business development. This includes prioritized network expansion, distribution optimization and pricing efficiency with focused plans for each region, to strengthen and facilitate the development of our business. We understand that our strategy requires certain time, strong focus on execution and resources, but we are confident that VimpelCom will restore its market positions.”

 

*	Please see the consolidated results on a pro-forma basis in the Attachment G.

 

 

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CONSOLIDATED OPERATIONS (US$, millions)		3Q 10				3Q 10/ 3Q 09				3Q 09				YTD 3Q 10				YTD 3Q 10/ YTD 3Q 09				YTD 3Q 09				YTD 3Q 08
Consolidated revenue			2,824.4				24.1	%			2,275.8				7,697.2				20.4	%			6,394.3				7,561.6
Russia			2,099.4				7.5	%			1,953.0				6,059.9				11.1	%			5,452.2				6,462.4
Ukraine			426.0				652.7	%			56.6				781.4				403.8	%			155.1				210.2
CIS			361.0				21.5	%			297.0				992.0				15.0	%			862.3				934.6
Consolidated adjusted OIBDA			1,377.7				20.0	%			1,148.3				3,680.7				15.6	%			3,184.6				3,735.9
%			48.8	%							50.5	%			47.8	%							49.8	%			49.4	%
Russia			987.9				-0.7	%			995.0				2,862.5				4.2	%			2,748.0				3,267.7
%			47.1	%							50.9	%			47.2	%							50.4	%			50.6	%
Ukraine			242.2				1901.7	%			12.1				416.9				1362.8	%			28.5				11.0
%			56.9	%							21.4	%			53.4	%							18.4	%			5.2	%
CIS			176.0				13.8	%			154.7				477.5				10.1	%			433.8				459.2
%			48.8	%							52.1	%			48.1	%							50.3	%			49.1	%

Consolidated net operating revenues increased by $548.6 million or 24.1% year-on-year mainly due to the consolidation of Kyivstar, which contributed $376.6 million, as well as organic revenue growth of $146.4 million in Russia and $34.7 million in the CIS.

Quarterly, net operating revenue increased by $182.8 million or 6.9%, mainly due to $115.4 million growth from Ukraine and $82.4 million revenue growth from Russia and the CIS. Sequential growth in key areas was mainly driven by increases in the active customer base, coupled with growing usage and seasonally higher roaming revenues.

Consolidated OIBDA improved year-on-year by $229.4 million. Ukraine and the CIS were the main contributors adding $230.1 million and $21.3 million respectively. Overall OIBDA margin decreased 1.7 percentage points from 50.5% to 48.8% year-on-year primarily due to resumed market investments in Russia partly offset by margin improvement in Ukraine.

OIBDA increased on a sequential basis by $115.9 million or 9.2%. This growth reflects decline in interconnect costs in Ukraine and ongoing cost control measures. The current consolidated OIBDA margin in high 40’s reflects the steady state of our business and is in line with our expectations.

Consolidated Capex increased by $396.8 million or 322.2% year-on-year following a return to our normal investment profile. The last twelve months Capex-to-revenue ratio was 15.0%.

 

 

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Russia - Business Context, Operations and Financial Results

Russia is the largest and most important part of our business. During 2010, our competitive position in the mobile segment weakened due to insufficient investments in network development made in the past six quarters. In addition, lack of focused activities on the market led to stagnation and quality erosion of our active customer base. As a result, mobile revenue growth rates year-on-year and quarter-on-quarter, although solid for a saturated market, were lower than those of our competitors.

Our key priority is to regain momentum and reverse the negative trend in the quality of our active customer base in the mobile segment. We intend to close the gap in the mobile data segment and see it not only as a new source of revenue, but increasingly as an important element influencing the loyalty of our customers. We are revising our approach to distribution, focusing on smart pricing and loyalty programs backed by further strengthening of our presence in retail and properly balanced capital investments.

Our fixed-line business performed well during the quarter with strong sequential growth in the wholesale business and corporate segment, reflecting our increased sales efforts and growing demand for data services. The consumer side of the fixed segment, mainly represented by FTTB technology, also showed positive dynamics with revenue growth of 30% year-on-year and 4% quarter-on-quarter. We continue to expand our unique high-quality IPTV product, which is currently available to customers in 13 cities.

Russian consolidated fixed and mobile OIBDA margin decreased year-on-year from 50.9% to 47.0%, which we see as the normal operational level after we resumed our investments into the market and new products, limited during 2009. Our mobile OIBDA margin, although slightly down quarter-on-quarter, remains above 50%.

We have already accelerated our investments in scale and quality of our networks. CAPEX in 3Q2010 increased 59% sequentially and more than threefold year-on-year. Despite much higher investments, our ROIC remained stable, reflecting our continued efforts in profitability and cash generation.

 

RUSSIA (RUR millions)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			64,284				61,211				5.0	%			61,738				4.1	%
Adjusted OIBDA			30,244				31,166				-3.0	%			29,114				3.9	%
Adjusted OIBDA margin, %			47.0	%			50.9	%							47.2	%
SG&A			17,263				15,427				11.9	%			16,891				2.2	%
including Sales & Marketing Expenses			6,057				4,940				22.6	%			5,594				8.3	%
including General & Administrative Costs			11,206				10,487				6.9	%			11,297				-0.8	%
SG&A percentage			26.9	%			25.2	%							27.4	%
Capital expenditures			11,715				2,829				314.1	%			7,364				59.1	%
ROIC, %			32.2	%			27.6	%							33.0	%

 

 

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RUSSIA REVENUES* (RUR millions)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			64,284				61,211				5.0	%			61,738				4.1	%
Mobile			53,804				51,277				4.9	%			51,825				3.8	%
including data revenue			3,196				2,654				20.4	%			2,997				6.6	%
Fixed-line			10,480				9,934				5.5	%			9,913				5.7	%
Business segment			4,804				5,011				-4.1	%			4,614				4.1	%
Wholesale			3,985				3,505				13.7	%			3,668				8.6	%
Residential			1,691				1,418				19.3	%			1,631				3.7	%
including FTTB revenue			1,241				953				30.2	%			1,196				3.8	%
RUSSIA OIBDA DEVELOPMENT* (RUR millions)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Adjusted OIBDA Total			30,244				31,166				-3.0	%			29,114				3.9	%
Mobile			27,130				28,047				-3.3	%			26,437				2.6	%
Fixed-line			3,114				3,119				-0.2	%			2,677				16.3	%
Adjusted Total OIBDA margin, %			47.0	%			50.9	%							47.2	%
Mobile, %			50.4	%			54.7	%							51.0	%
Fixed-line, %			29.7	%			31.4	%							27.0	%
RUSSIA OPERATING DEVELOPMENT		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Mobile operations
Subscriptions (‘000)			51,615				51,028				1.2	%			50,912				1.4	%
including mobile broadband subscriptions			1,500				896				67.4	%			1,300				15.4	%
MOU, min			222.1				213.6				4.0	%			219.3				1.3	%
Adjusted MOU**, min			227.8				216.7				5.1	%			224.1				1.7	%
ARPU, RUR			342.5				331.8				3.2	%			329.9				3.8	%
Fixed-line operations
FTTB subscriptions (‘000)			1,193				850				40.4	%			1,131				5.5	%
FTTB ARPU, RUR			360.1				389.8				-7.6	%			356.6				1.0	%

 

*	Mobile and fixed revenues for all periods were adjusted; see definition of reportable segments in Attachment A.

**	Adjusted MOU is calculated for mobile subscriptions excluding mobile broadband subscriptions using USB modems.

 

 

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Ukraine - Business Context, Operations and Pro-forma Financial Results^*

In Ukraine, the macroeconomic situation continues to improve. In the telecom market, we observe a more stable competitive situation. This environment has supported a reversal in the previous negative revenue trend and we reported 3.6% year-on-year growth in consolidated revenues in Ukraine on a pro-forma basis. Sequentially, revenues increased 9.6% driven by increased subscriptions, usage and seasonally higher roaming.

After the Ukrainian Anti-Monopoly Committee’s final decision on October 19^th related to the Kyivstar transaction, we began the active phase of integrating our operations. We remain confident that we will be able to achieve the synergies as initially anticipated.

Quarterly operating highlights in Ukraine:

 

•

Our marketing activities focused on the price sensitive segment helped to reverse the trend and increase our active customer base, which was up 4.1% quarter-on-quarter

 

•

ARPU increased quarter-on-quarter by 7.3% and 4.4% year-on-year driven by continuous increase in usage and seasonal trends

 

•

Consolidated mobile OIBDA margin was up to 58.5% on the back of revenue growth and operational excellence

 

•

We remain one of the leaders in the Ukrainian broadband market in terms of new broadband subscriptions adding 50,000 customers, a 205.0% increase compared to 3Q09

SG&A costs decreased by 75.5 million UAH or 8.0% year-on-year as a result of the ongoing operational excellence program started in 2009, and helped drive substantial improvements in the OIBDA margin. Quarter-on-quarter SG&A costs grew just 2.3% despite the substantial growth in revenues.

Capital expenditures were up 6.7% year-on-year but down quarter-on-quarter mostly due to delayed deliveries, which we expect in the fourth quarter of 2010. We continue to invest in the development of our business with Capex/Revenue expected to be at around 15% calculated on an actual annualized basis. We see the development of our fixed data networks as a priority.

Overall, we see further recovery of the Ukrainian telecom market and are confident in sustaining our leadership position.

 

*	Ukraine reporting segment includes operations of Kyivstar, URS and GTI. “Pro forma basis” means that the numbers are presented assuming that the business combination with Kyivstar had taken place on January 1, 2009

 

 

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UKRAINE PRO-FORMA (UAH millions)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			3,365.4				3,247.0				3.6	%			3,071.0				9.6	%
Adjusted OIBDA			1,913.2				1,629.0				17.4	%			1,663.0				15.0	%
Adjusted OIBDA margin, %			56.8	%			50.2	%							54.2	%
SG&A			873.5				949.0				-8.0	%			854.0				2.3	%
including Sales & Marketing Expenses			167.3				223.0				-25.0	%			165.0				1.4	%
including General & Administrative Costs			706.2				726.0				-2.7	%			689.0				2.5	%
SG&A percentage			26.0	%			29.2	%							27.8	%
Capital expenditures			403.3				378.0				6.7	%			538.0				-25.0	%
UKRAINE PRO-FORMA REVENUES (UAH millions)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			3,365.4				3,247.0				3.6	%			3,071.0				9.6	%
Mobile			3,239.4				3,093.0				4.7	%			2,928.0				10.6	%
Fixed-line			126.0				154.0				-18.2	%			143.0				-11.9	%
Business segment			74.9				83.0				-9.8	%			73.0				2.6	%
Wholesale			27.2				58.0				-53.1	%			47.0				-42.1	%
Residential			23.9				13.0				83.8	%			23.0				3.9	%
UKRAINE PRO-FORMA OIBDA DEVELOPMENT (UAH millions)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Adjusted OIBDA Total			1,913.2				1,629.0				17.4	%			1,663.0				15.0	%
Mobile			1,896.5				1,585.0				19.7	%			1,614.0				17.5	%
Fixed-line			16.7				44.0				-62.0	%			49.0				-65.9	%
Adjusted Total OIBDA margin, %			56.8	%			50.2	%							54.2	%
Mobile, %			58.5	%			51.2	%							55.1	%
Fixed-line, %			13.3	%			28.6	%							34.3	%
UKRAINE ACTUAL (UAH millions)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			3,365.4				441.7				661.9	%			2,461.3				36.7	%
Adjusted OIBDA Total			1,913.2				94.5				1924.6	%			1,304.4				46.7	%
Net income/(loss) attributable to VimpelCom Ltd.			587.3				-296.6				n/a				236.1				148.8	%

 

 

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UKRAINE PRO-FORMA OPERATING DEVELOPMENT		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Mobile operations
Subscriptions (‘000)			25,057				24,484				2.3	%			24,059				4.1	%
MOU, min			433.2				330.6				31.0	%			426.7				1.5	%
ARPU mobile, UAH			42.6				40.8				4.4	%			39.7				7.3	%
ARPU mobile, US$			5.4				5.3				1.9	%			5.0				8.0	%
Fixed-line operations
Broadband subscriptions (‘000)			213.8				70.1				205.0	%			164.0				30.4	%
Broadband ARPU, UAH			38.0				53.1				-28.4	%			42.8				-11.2	%
Broadband ARPU, US$			4.8				6.8				-29.4	%			5.4				-11.1	%

 

 

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CIS - Business Context, Operations and Financial Results *

In the CIS, we achieved considerable organic revenue growth both on a year-on-year and quarter-on-quarter basis. The results from our largest CIS market, Kazakhstan, continued to demonstrate strong dynamics, with robust revenue growth and high OIBDA margin. During the quarter, we achieved double-digit revenue growth in Georgia and Tajikistan, and we saw a reversal of negative market trends in Uzbekistan and accelerated recovery in Kyrgyzstan.

 

•

CIS mobile subscriptions grew to almost 15 million representing a 22.8% increase year-on-year

 

•

Net operating revenues reached $361.0 million, an increase of 21.5% year-on-year including a 11.7% organic growth; consolidated CIS OIBDA margin remains strong at 48.8%, in line with our targeted level of high 40’s

 

•

In Kazakhstan, growth in revenue was over 12% in local currency year-on-year and 7.6% quarter-on-quarter, reflecting growth in both mobile and fixed operations

 

•

Total number of broadband subscriptions increased 178.7% year-on-year and 15.0% quarter-on-quarter as we continue to develop our broadband projects in Kazakhstan, Uzbekistan and Armenia

 

•

Year-on-year growth of selling and marketing expenses is due to consolidation of Kyrgyzstan and substantial growth in subscription base there. Sequential increase addresses competitive situation in Armenia and Uzbekistan and ongoing business expansion in our core markets

 

•

Capex for the CIS markets increased substantially both year-on-year and quarter-on-quarter to support our network expansion, which is mainly focused on increasing mobile penetration and investments in fixed networks.

Overall, we are pleased with the results from our CIS business unit. We continue to invest in the region and expect to benefit from growing penetration of voice and data services.

 

CIS OPERATIONS (US$ millions)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			361.0				297.0				21.5	%			336.2				7.4	%
Adjusted OIBDA			176.0				154.7				13.8	%			161.9				8.7	%
Adjusted OIBDA margin, %			48.8	%			52.1	%							48.2	%
SG&A			94.6				73.3				29.1	%			90.1				5.0	%
including Sales & Marketing Expenses			26.2				20.5				27.8	%			21.4				22.4	%
including General & Administrative Costs			68.4				52.8				29.5	%			68.7				-0.4	%
SG&A percentage			26.2	%			24.7	%							26.8	%
Capital expenditures			78.3				21.5				264.2	%			70.6				10.9	%
ROIC, %			10.8	%			11.5	%							10.0	%
Mobile subscriptions (‘000)			14,782				12,036				22.8	%			13,875				6.5	%
including mobile broadband subscriptions			20.3				0.0				n/a				17.1				18.7	%
Broadband fixed-line subscriptions (‘000)			74.4				26.7				178.7	%			64.7				15.0	%

 

*	CIS operations include operations in Kazakhstan, Uzbekistan, Armenia, Kyrgyzstan (since 1Q10), Tajikistan, and Georgia.

 

 

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South-East Asia – Overview

 

•

Our Vietnamese joint-venture maintained its operations on a limited level during the third quarter as shareholders’ negotiations continued on the optimal way of further financing and expanding the business. We do not consolidate the Vietnamese operations in our financial reporting.

 

•

In Cambodia, recently we managed to reverse the negative trends stemming from regulatory action earlier this year. Although the quarterly results were slightly below our expectations, we are confident that our business in Cambodia will be on track by the end of the year.

 

SEA (US$ mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating mobile revenues			5.0				2.4				108.3	%			5.5				-9.1	%
Adjusted mobile OIBDA			-8.8				-13.2				n/a				-8.1				n/a

Content of the attachment tables:

 

Attachment A:		Definitions			12
Attachment B:		VimpelCom Ltd financial Statements			15
Attachment C:		Reconciliation Tables (Unaudited)			19
Attachment D:		Capex Development			21
Attachment E:		Financial and Operational Highlights in Functional Currencies			21
Attachment F:		Key Financial Results in US Dollars Russia			25
Attachment G:		VimpelCom Ltd Financial and Operational Highlights on Pro-Forma Basis			29
Attachment H:		Average Rates of Functional Currencies to USD			29

 

 

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For more information on financial and operating data for specific countries, as well as reconciliation of OIBDA, please refer to the supplementary file FinancialOperatingQ32010.xls on our website at http://www.vimpelcom.com/news/qrep.wbp.

The Company’s management will discuss its third quarter 2010 results during a conference call and slide presentation on December 2, 2010 at 4:30 pm CET, (10:30 am US ET). The call and slide presentation may be accessed via webcast at the following URL address http://www.vimpelcom.com. The conference call replay will be available through December 9, 2010. The slide presentation webcast will also be available for download on VimpelCom’s website http://www.vimpelcom.com.

VimpelCom consists of telecommunications operators providing voice and data services through a range of wireless, fixed and broadband technologies. The VimpelCom group is headquartered in Amsterdam and has operations in Russia, Ukraine, Kazakhstan, Uzbekistan, Tajikistan, Georgia, Armenia, Kyrgyzstan, Vietnam and Cambodia, covering territory with a total population of about 345 million. VimpelCom operating companies provide services under the “Beeline” and “Kyivstar” brands. VimpelCom’s ADSs are listed on the New York Stock Exchange under the symbol “VIP”.

This press release contains “forward-looking statements”, as the phrase is defined in Section 27A of the Securities Act and Section 21E of the Exchange Act. These statements include those relating to our transaction with Weather Investments, realization of synergies in Ukraine and the expected growth and development of our operations. These and other forward-looking statements are based on management’s best assessment of the Company’s strategic and financial position and of future market conditions and trends. These discussions involve risks and uncertainties. The actual outcome may differ materially from these statements as a result of continued volatility in the economies in the markets in which the Company operates, unforeseen developments from competition, governmental regulation of the telecommunications industries, general political uncertainties in the markets in which the Company operates and/or litigation with third parties. In addition, there can be no assurance that all of the conditions precedent to completion of our transaction with Weather Investments will be satisfied. The actual outcome may also differ materially if the Company is unable to obtain all necessary corporate approvals relating to its business, if the Company is unable to successfully integrate its Ukrainian operations and other newly-acquired businesses and other factors. There can be no assurance that such risks and uncertainties will not have a material adverse effect on the Company. Certain factors that could cause actual results to differ materially from those discussed in any forward-looking statements include the risk factors described in the Company’s registration statement on Form F-4 filed with the U.S. Securities and Exchange Commission (the “SEC”), OJSC VimpelCom’s public filings with the SEC, including its Annual Report on Form 20-F for the year ended December 31, 2009, and other public filings made by the Company with the SEC, which risk factors are incorporated herein by reference. The Company disclaims any obligation to update developments of these risk factors or to announce publicly any revision to any of the forward-looking statements contained in this release, or to make corrections to reflect future events or developments.

For more information, please contact:

 

Alexey Subbotin				Mateo Millett
VimpelCom				FD
Tel:		+31 20 79 77 200 (Amsterdam)		Tel: 1-617 897-1533
Tel:		+7 495 9545888 (Moscow)		mateo.millett@fd.com
Investor_Relations@vimpelcom.com

 

 

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Attachment A: Definitions

Adjusted OIBDA is a non-U.S. GAAP financial measure. Adjusted OIBDA, previously referred to as EBITDA or OIBDA by OJSC VimpelCom, is defined as operating income before depreciation, amortization and impairment loss. Our management uses adjusted OIBDA and adjusted OIBDA margin as supplemental performance measures and believes that adjusted OIBDA and adjusted OIBDA margin provide useful information to investors because they are indicators of the strength and performance of the Company’s business operations, including its ability to fund discretionary spending, such as capital expenditures, acquisitions and other investments, as well as indicating its ability to incur and service debt. In addition, the components of adjusted OIBDA include the key revenue and expense items for which the Company’s operating managers are responsible and upon which their performance is evaluated. Adjusted OIBDA also assists management and investors by increasing the comparability of the Company’s performance against the performance of other telecommunications companies that provide OIBDA or EBITDA (earnings before interest, taxes, depreciation and amortization) information. This increased comparability is achieved by excluding the potentially inconsistent effects between periods or companies of depreciation, amortization and impairment loss, which items may significantly affect operating income between periods. However, our adjusted OIBDA results may not be directly comparable to other companies’ reported OIBDA or EBITDA results due to variances and adjustments in the components of OIBDA (including our calculation of adjusted OIBDA) or calculation measures. Additionally, a limitation of adjusted OIBDA’s use as a performance measure is that it does not reflect the periodic costs of certain capitalized tangible and intangible assets used in generating revenues or the need to replace capital equipment over time. Reconciliation of adjusted OIBDA to net income, the most directly comparable U.S. GAAP financial measure, is presented below in the reconciliation tables section as well as in the supplementary file FinancialOperatingQ22010.xls on our website at http://www.vimpelcom.com/news/qrep.wbp.

Adjusted OIBDA margin is a non-U.S. GAAP financial measure. We calculate adjusted OIBDA margin as adjusted OIBDA divided by net operating revenues, expressed as a percentage. Reconciliation of adjusted OIBDA margin to net income as a percentage of net operating revenues, the most directly comparable U.S. GAAP financial measure, is presented below in the reconciliation tables section as well as in the supplementary file FinancialOperatingQ12010.xls on our website at http://www.vimpelcom.com/news/qrep.wbp.

ARPU (Monthly Average Revenue per User) is calculated by dividing service revenue during the relevant period, including roaming revenue and interconnect revenue, but excluding revenue from connection fees, sales of handsets and accessories and other non-service revenue, by the average number of subscriptions during the period and dividing by the number of months in that period.

Broadband subscriptions are the customer contracts that served as a basis for revenue generating activity in the three months prior to the measurement date, as a result of activities including monthly internet access using FTTB, xDSL and WiFi technologies as well as mobile internet access via USB modems using 3G/HSDPA technologies.

Capital expenditures (Capex) - purchases of new equipment, new construction, upgrades, software, other long lived assets and related reasonable costs incurred prior to intended use of the non current asset, accounted at the earliest event of advance payment or delivery. Long-lived assets acquired in business combinations are not included in capital expenditures.

CIS Geographic Segment for the purpose of VimpelCom’s reporting includes our operations in the following countries: Kazakhstan, Kyrgyzstan, Uzbekistan, Tajikistan, Armenia and Georgia. Starting from the second quarter 2010 OJSC VimpelCom’s operation in Ukraine was included into a separate reporting segment together with Kyivstar and reported on a pro-forma basis for all periods starting from the first quarter of 2010.

 

 

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Free cash flow is a non-U.S. GAAP financial measure and is calculated as net income plus depreciation and amortization minus capital expenditures for the reported period (a quarter or a year, respectively). The Company believes that free cash flow provides useful information to investors because it is an indicator of our company’s operational and financial performance and represents our ability to generate cash to maintain or expand our asset base. The Company also refers to free cash flow in determining its dividends. Free cash flow should not be considered in isolation as an alternative to operating cash flow or any other measure of the company’s cash flows management. Reconciliation of free cash flow to net income, the most directly comparable U.S. GAAP financial measure, is presented below in the reconciliation tables section (Attachment C).

General and administrative costs (G&A) include salaries and outsourcing costs, including related social contributions required by law; stock price-based compensation expenses; repair and maintenance expenses; rent, including lease payments for base station sites; utilities; other miscellaneous expenses, such as insurance, operating taxes, license fees, and accounting, audit and legal fees.

Households passed are households located within buildings, in which indoor installation of all the FTTB equipment necessary to install terminal residential equipment has been completed.

SEA Geographic segment – VimpelCom’s operations in South-East Asia, which include operations in Cambodia and VimpelCom’s respective equity in net results of operations of its Vietnamese associate entity GTEL-Mobile JSC (“GTEL-Mobile”).

Mobile subscriptions are SIM-cards registered in the system as of a measurement date, users of which generated revenue at any time during the three months prior to the measurement date. This includes revenue coming from any incoming and outgoing calls, subscription fee accruals, debits related to service, outgoing SMS, Multimedia Messaging Service (referred to as MMS), data transmission and receipt sessions, but does not include incoming SMS and MMS sent by VimpelCom or abandoned calls. VimpelCom’s total number of mobile subscriptions also includes SIM-cards for use of mobile Internet service via USB modems.

Mobile services are wireless voice and data transmission services excluding WiFi.

MOU (Monthly Average Minutes of Use per User) is calculated by dividing the total number of minutes of usage for incoming and outgoing calls during the relevant period (excluding guest roamers) by the average number of mobile subscriptions during the period and dividing by the number of months in that period.

Net debt is a non-U.S. GAAP financial measure and is calculated as the sum of interest bearing long-term debt and short-term debt minus cash and cash equivalents. The Company believes that net debt provides useful information to investors because it shows the amount of debt outstanding to be paid after using available cash and cash equivalent, as well as short-term investments. Net debt should not be considered in isolation as an alternative to long-term debt and short-term debt, or any other measure of the company financial position. Reconciliation of net debt to long-term debt and short-term debt, the most directly comparable U.S. GAAP financial measures, is presented below in the reconciliation tables section.

Reportable segments – The Company identified Russia mobile, Russia fixed-line, CIS mobile, CIS fixed-line, Ukraine mobile, Ukraine fixed-line and Asia mobile reporting segments based on the business activities in different geographical areas. Although Georgia is no longer a member of the CIS, consistent with VimpelCom’s historic reporting practice VimpelCom continues to include Georgia in its CIS reporting segment. Mobile lines include activities for the providing of wireless telecommunication services to the Company’s subscribers; fixed-line includes all activities for providing wireline telecommunication services, broadband and consumer Internet. Revenues and expenses are shown net of intercompany transactions within one geographical segment. Intersegment revenues and expenses between different geographical segments are eliminated at the consolidated level. Starting second quarter of 2010 VimpelCom also started to consider VimpelCom’s respective equities in net results of operations of the Company’s associates Morefront Holdings Ltd. and GTEL-Mobile as part of operations of Russia mobile and Asia mobile reporting segments, respectively, as well as VimpelCom’s DVB-T and DVB-H activities were allocated to Russia fixed-line and Russia mobile segments, respectively. The comparative information was retrospectively adjusted.

 

 

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ROCE is a non-U.S. GAAP financial measure and is calculated as operating income for the last twelve months divided by the sum of net debt, total equity and redeemable noncontrolling interest calculated as an average of the quarter-end balances for the last four quarters. The Company believes that ROCE (return on capital employed) provides useful information to management of our company and investors because it is an indicator of our company’s operational performance and represents a return on employed capital at the end of each reported period. Calculation of ROCE on the basis of U.S. GAAP financial measures is presented in the reconciliation tables section below (Attachment C).

ROIC is a non-U.S. GAAP financial measure and is calculated as operating income for the last twelve months divided by the sum of property and equipment, licenses, intangible assets, goodwill, software and frequency permissions as reflected on the balance sheet as of the end of the period. The Company believes that ROIC (return on invested capital) provides useful information to management of our company because it is an indicator of our company’s operational performance and provides a useful indication of how profitably our company used its resources in each reportable segment over the reported period. Calculation of ROIC on the basis of U.S. GAAP financial measures is presented below in the reconciliation tables section below (Attachment C).

Sales and marketing costs (S&M) include marketing, advertising and dealer commissions expenses.

Ukraine segment – Due to change in the reporting structure of VimpelCom and in line with intentions made public by the Company in the previous quarter, Ukraine was considered to be a separate reporting segment apart from the CIS and includes the operations of VimpelCom’s indirect Ukrainian subsidiaries Closed Joint Stock Company “Ukrainian Radio Systems” (“URS”) and “Golden Telecom” Limited Liability Company (“GT LLC”)), as well as Kyivstar.

VAS (value added services) includes short messages (“SMS”), multimedia messages (“MMS”), caller number identification, call waiting, data transmission, mobile Internet, downloadable content and other services.

Voice revenue – for the purpose of press-release voice revenue includes voice revenue generated by our subscribers, roaming revenues generated by our subscribers and guest roamers and interconnect revenue. In our annual report and annual report on Form 20-F we report each of these types of revenues separately.

 

 

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Attachment B: VimpelCom Ltd financial statements

VimpelCom Ltd

Unaudited Condensed Consolidated Statements of Income

 

		Three months ended September 30,								Nine months ended September 30,
		2010				2009				2010				2009
		(In thousands of US dollars, except share amounts)
Operating revenues:
Service revenues		$	2,785,966			$	2,245,967			$	7,567,961			$	6,298,463
Sales of equipment and accessories			35,072				26,130				106,190				86,998
Other revenues			3,351				5,523				22,999				14,694
Total operating revenues			2,824,390				2,277,620				7,697,151				6,400,155
Revenue based tax			—				(1,823	)			—				(5,839	)
Net operating revenues			2,824,390				2,275,797				7,697,151				6,394,316
Operating expenses:
Service costs			594,687				488,425				1,649,297				1,370,952
Cost of equipment and accessories			44,276				26,876				118,505				85,564
Selling, general and administrative expenses			799,122				599,186				2,208,835				1,710,198
Depreciation			408,284				366,039				1,137,486				1,000,201
Amortization			137,771				71,164				321,010				213,947
Provision for doubtful accounts			8,683				12,974				39,812				42,974
Total operating expenses			1,992,825				1,564,664				5,474,945				4,423,836
Operating income			831,565				711,133				2,222,206				1,970,480
Other income and expenses:
Interest income			14,558				7,706				42,182				41,310
Net foreign exchange (loss)/gain			27,267				24,516				5,808				(397,191	)
Interest expense			(125,713	)			(156,793	)			(399,637	)			(434,802	)
Equity in net gain/(loss) of associates			19,201				4,861				26,505				(25,754	)
Other (expenses)/income, net			(26,512	)			(3,206	)			(84,868	)			(8,124	)
Total other income and expenses			(91,199	)			(122,916	)			(410,010	)			(824,561	)
Income before income taxes			740,365				588,217				1,812,198				1,145,919
Income tax expense			230,303				152,336				561,310				309,665
Net income			510,062				435,881				1,250,887				836,254
Net income/(loss) attributable to the noncontrolling interest			14,161				1,384				38,768				(2,136	)
Net income attributable to VimpelCom		$	495,901			$	434,497			$	1,212,120			$	838,390
Basic EPS :
Net income attributable to VimpelCom per common share restated		$	0.39			$	0.44			$	1.05			$	0.82
Weighted average common shares outstanding (thousand)			1,291,232				1,012,862				1,178,629				1,012,555

 

 

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VimpelCom Ltd Unaudited Condensed Consolidated Balance Sheets

 

		September 30, 2010				December 31, 2009
		(In thousands of US dollars, except share amounts)
Assets
Current assets:
Cash and cash equivalents		$	2,467,002			$	1,446,949
Trade accounts receivable, net of allowance for doubtful accounts			525,659				392,365
Inventory			83,620				61,919
Deferred income taxes			99,405				91,493
Input value added tax			143,908				96,994
Due from related parties			113,006				249,631
Other current assets			348,501				627,257
Total current assets			3,781,102				2,966,608
Property and equipment, net			6,480,385				5,561,569
Telecommunications licenses, net			583,221				542,597
Goodwill			6,943,143				3,284,293
Other intangible assets, net			1,629,117				700,365
Software, net			513,459				448,255
Investments in associates			440,952				436,767
Other assets			674,367				792,087
Total assets		$	21,045,746			$	14,732,541
Liabilities, redeemable noncontrolling interest and equity
Current liabilities:
Accounts payable		$	749,750			$	545,690
Due to employees			149,032				113,368
Due to related parties			2,777				9,211
Accrued liabilities			393,797				315,666
Taxes payable			287,015				212,767
Customer advances, net of VAT			326,956				376,121
Customer deposits			28,412				28,386
Short-term debt			2,126,113				1,813,141
Total current liabilities			4,063,852				3,414,350
Deferred income taxes			787,178				596,472
Long-term debt			4,366,641				5,539,906
Other non-current liabilities			171,418				164,636
Commitments, contingencies and uncertainties			—				—
Total liabilities			9,389,088				9,715,364
Redeemable noncontrolling interest			518,664				508,668
Equity:
Convertible voting preferred stock (0.001 US$ nominal value per share), 200,000,000 shares authorized; 128,532,000 shares issued and outstanding			129				129
Common stock (0.001 US$ nominal value per share), 1,800,000,000 shares authorized; 1,302,559,308 shares issued (December 31, 2009: 1,025,620,440); 1,291,232,105 shares outstanding (December 31, 2009: 1,014,291,580)			1,303				1,026
Additional paid-in capital			6,294,869				1,142,594
Retained earnings			5,286,612				4,074,492
Accumulated other comprehensive loss			(497,816	)			(488,277	)
Treasury stock, at cost, 11,327,203 shares of common stock (December 31, 2009: 11,328,860)			(223,406	)			(223,421	)
Total VimpelCom shareholders’ equity			10,861,692				4,506,543
Noncontrolling interest			276,302				1,966
Total equity			11,137,994				4,508,509
Total liabilities, redeemable noncontrolling interest and equity		$	21,045,746			$	14,732,541

 

 

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VimpelCom Ltd Unaudited Condensed Consolidated Statements of Cash Flows

 

		Nine months ended September 30,
		2010				2009
		(In thousands of US dollars)
Operating activities
Net cash provided by operating activities		$	2,901,086			$	2,761,844
Investing activities
Purchases of property and equipment			(750,530	)			(482,455	)
Purchases of intangible assets			(15,245	)			(13,067	)
Purchases of software			(145,591	)			(128,001	)
Investments in associates			—				(12,424	)
Payment for shares in Golden Telecom			(143,569	)			—
Cash proceeds from Kyivstar aqcuisition			167,077				—
Acqusition of Foratec, net of cash acquired			(36,372	)			—
Cash increase due to Sky Mobile consolidation			4,702				—
Loan granted			(5,305	)			—
Loan receivable repayment			22,910				—
Proceeds from withdrawal of deposits			435,166				—
Purchases of other assets, net			(15,065	)			(29,877	)
Net cash provided by/(used in) investing activities			(481,820	)			(665,824	)
Financing activities
Proceeds from bank and other loans			738,450				1,226,137
Repayments of bank and other loans			(1,589,976	)			(1,691,052	)
Payments of fees in respect of debt issues			(2,606	)			(51,516	)
Share capital issued and paid			905				—
Share premium contributed			(225	)			5,412
Purchase of noncontrolling interest in consolidated subsidiaries			(12,594	)			(439	)
Payment of dividends			(2,049	)			—
Payment of dividends to noncontrolling interest			(34,517	)			(718	)
Purchase of own shares			(479,936	)			—
Net proceeds from employee stock options			27				—
Net cash used in financing activities			(1,382,521	)			(512,176	)
Effect of exchange rate changes on cash and cash equivalents			(16,691	)			23,788
Net increase in cash and cash equivalents			1,020,053				1,607,632
Cash and cash equivalents at beginning of period			1,446,949				914,683
Cash and cash equivalents at end of period		$	2,467,002			$	2,522,315

 

 

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VimpelCom Ltd Unaudited Condensed Consolidated Statements of Cash Flows (Continued)

 

		Nine months ended September 30,
		2010				2009
		(In thousands of US dollars)
Supplemental cash flow information
Cash paid during the period:
Income tax		$	490,468			$	280,774
Interest			378,872				377,568
Non-cash activities:
Accounts payable for property, equipment and other long-lived assets			293,171				128,150

 

 

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Attachment C: Reconciliation Tables (Unaudited)

Reconciliation of Consolidated Adjusted OIBDA of VimpelCom

(In millions of US$)

 

		3Q 10				3Q 09				2Q 10
Adjusted OIBDA			1,377.7				1,148.3				1,261.8
Depreciation			(408.3	)			(366.0	)			(376.7	)
Amortization			(137.8	)			(71.2	)			(116.5	)
Operating income			831.6				711.1				768.6
Interest income			14.6				7.7				16.1
Net foreign exchange (loss)/gain			27.3				24.5				(126.4	)
Interest expense			(125.7	)			(156.8	)			(132.3	)
Equity in net gain/(loss) of associates			19.2				4.9				11.1
Other (expense)/income, net			(26.6	)			(3.2	)			(10.0	)
Income tax expense			(230.3	)			(152.3	)			(178.0	)
Net income			510.1				435.9				349.1

Reconciliation of Consolidated Adjusted OIBDA Margin of VimpelCom

 

		3Q 10				3Q 09				2Q 10
Adjusted OIBDA margin			48.8	%			50.5	%			47.8	%
Less: Depreciation as a percentage of net operating revenues			(14.5	%)			(16.2	%)			(14.3	%)
Less: Amortization as a percentage of net operating revenues			(4.9	%)			(3.1	%)			(4.4	%)
Operating income as a percentage of net operating revenues			29.4	%			31.2	%			29.1	%
Interest income			0.5	%			0.3	%			0.6	%
Net foreign exchange (loss)/gain			1.0	%			1.1	%			(4.8	%)
Interest expense			(4.5	%)			(6.9	%)			(5.0	%)
Equity in net gain/(loss) of associates			0.7	%			0.2	%			0.4	%
Other (expense)/income, net			(0.8	%)			0.0	%			(0.4	%)
Income tax expense			(8.2	%)			(6.7	%)			(6.7	%)
Net income margin			18.1	%			19.2	%			13.2	%

 

 

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Reconciliation of VimpelCom Consolidated ROCE and Net Debt

(In millions of US$)

 

VimpelCom Ltd. Actual ROCE, %		2Q ‘08				3Q ‘08				4Q ‘08				1Q ‘09				2Q ‘09				3Q ‘09				4Q ‘09				1Q ‘10				2Q ‘10				3Q ‘10
Consolidated operating income LTM			2,643				2,859				2,536				2,402				2,357				2,179				2,578				2,633				2,710				2,830
Net debt			6,772				7,276				7,528				6,729				6,325				5,547				5,906				5,118				3,980				4,026
Long-term debt			6,503				6,255				6,534				5,307				5,732				5,593				5,540				5,292				4,801				4,367
Short-term debt			1,248				1,748				1,909				2,388				2,242				2,476				1,813				1,356				1,532				2,126
Cash and cash equivalents			(979	)			(727	)			(915	)			(966	)			(1,649	)			(2,522	)			(1,447	)			(1,530	)			(2,353	)			(2,467	)
Total equity			6,436				5,639				4,140				3,146				4,038				4,569				4,509				5,376				10,644				11,138
Redeemable noncontrolling interest			0				470				470				500				500				505				509				512				515				519
Total capital employed (CE)			13,208				13,385				12,138				10,375				10,863				10,621				10,924				11,006				15,139				15,683
Average capital employed															12,277				11,690				10,999				10,696				10,854				11,923				13,188
ROCE consolidated															19.6	%			20.2	%			19.8	%			24.1	%			24.3	%			22.7	%			21.5	%

Reconciliation of ROIC

 

Russia, ROIC, % (based on RUR millions)		3Q 10				3Q 09				2Q 10
Operating income LTM			75,969				66,515				76,048
Property and equipment			124,465				126,599				119,880
Licenses			4,798				7,102				5,252
Intangible assets			13,242				15,533				13,491
Goodwill			80,181				78,896				78,897
Software			9,825				9,557				9,479
Frequency permissions			3,234				3,050				3,172
Total Invested Capital			235,745				240,737				230,171
ROIC, %			32.2	%			27.6	%			33.0	%
CIS, ROIC, % (based on US$ millions)		3Q 10				3Q 09				2Q 10
Operating income LTM			270.1				261.3				260.7
Property and equipment			1,146.0				1,078.1				1,117.9
Licenses			216.3				256.8				233.8
Intangible assets			176.0				184.6				172.3
Goodwill			874.5				666.0				988.9
Software			77.5				79.5				76.6
Frequency permissions			4.6				2.8				4.6
Total Invested Capital			2,494.9				2,267.8				2,594.1
ROIC, %			10.8	%			11.5	%			10.0	%

 

 

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Attachment D: Capex Development

 

CAPEX (in US$ millions)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Total capex			520.1				123.2				322.2	%			381.4				36.4	%
Russia			382.6				90.4				323.2	%			243.4				57.2	%
Ukraine			51.0				3.0				1600.0	%			58.6				-13.0	%
Other CIS			78.3				21.6				262.5	%			70.6				10.9	%
SEA			8.2				8.2				0.0	%			8.8				-6.8	%

Attachment E: Financial and Operational Highlights in Functional Currencies

Ukraine

 

UKRAINE ACTUAL (UAH millions)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			3,365.4				441.7				661.9	%			2,461.3				36.7	%
Adjusted OIBDA			1,913.2				94.5				1924.6	%			1,304.4				46.7	%
Adjusted OIBDA margin, %			56.8	%			21.4	%							53.0	%
SG&A			873.5				162.1				438.9	%			691.4				26.3	%
including Sales & Marketing Expenses			167.3				40.9				309.0	%			134.9				24.0	%
including General & Administrative Costs			706.2				121.2				482.7	%			556.5				26.9	%
SG&A percentage			26.0	%			36.7	%							28.1	%
Capital expenditures			403.3				23.5				1616.2	%			464.1				-13.1	%
UKRAINE ACTUAL REVENUES (UAH millions)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			3,365.4				441.7				661.9	%			2,461.3				36.7	%
Mobile			3,239.4				251.5				1188.0	%			2,309.0				40.3	%
Fixed-line			126.0				190.2				-33.8	%			152.3				-17.3	%
Business segment			74.9				82.5				-9.2	%			72.8				2.9	%
Wholesale			27.2				94.9				-71.3	%			56.8				-52.1	%
Residential			23.9				12.8				86.7	%			22.7				5.3	%
UKRAINE ACTUAL ADJUSTED OIBDA DEVELOPMENT (UAH mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Adjusted OIBDA Total			1,913.2				94.5				1924.6	%			1,304.4				46.7	%
Mobile			1,896.5				49.1				3762.5	%			1,255.1				51.1	%
Fixed-line			16.7				45.4				-63.2	%			49.3				-66.1	%
Adjusted Total OIBDA margin, %			56.8	%			21.4	%							53.0	%
Mobile, %			58.5	%			19.5	%							54.4	%
Fixed-line, %			13.3	%			23.9	%							32.4	%

 

 

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CIS — Revenues Development

 

KAZAKHSTAN (KZT mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			29,100				25,928				12.2	%			27,054				7.6	%
Mobile			28,422				25,538				11.3	%			26,503				7.2	%
Fixed-line			678				390				73.8	%			551				23.0	%
ARMENIA (AMD mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			17,785				19,167				-7.2	%			17,073				4.2	%
Mobile			7,698				7,575				1.6	%			6,701				14.9	%
Fixed-line			10,087				11,592				-13.0	%			10,372				-2.7	%
UZBEKISTAN (US$ mln)*		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			53.8				50.1				7.4	%			51.4				4.7	%
Mobile			51.4				46.8				9.8	%			48.9				5.1	%
Fixed-line			2.4				3.3				-27.3	%			2.5				-4.0	%
TAJIKISTAN (US$ mln)*		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			22.2				14.9				49.0	%			20.1				10.4	%
Mobile			16.5				14.9				10.7	%			14.9				10.7	%
Fixed-line			5.7				—				n/a				5.2				9.6	%
GEORGIA (GEL mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			23.9				14.9				60.4	%			20.8				14.9	%
Mobile			23.2				14.9				55.7	%			20.0				16.0	%
Fixed-line			0.7				—				n/a				0.8				-12.5	%
KYRGYZSTAN (KGS mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Mobile net operating revenues			1,368				—				n/a				1,261				8.5	%
CIS REVENUES** (US$ mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			361.0				297.0				21.5	%			336.2				7.4	%
Mobile			320.5				260.0				23.3	%			297.4				7.8	%
Fixed-line			40.5				37.0				9.5	%			38.8				4.4	%

 

*	US$ is the functional currency in Uzbekistan and Tajikistan.

**	Mobile and fixed revenues for all periods were recalculated – please see definition of reportable segments in Attachment A.

 

 

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CIS – Adjusted OIBDA Development

 

KAZAKHSTAN (KZT mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Adjusted OIBDA total			16,483				15,341				7.4	%			15,526				6.2	%
Mobile			16,245				15,350				5.8	%			15,406				5.4	%
Fixed-line			238				-9				n/a				120				98.3	%
Adjusted OIBDA margin, %			56.6	%			59.2	%							57.4	%
ARMENIA (AMD mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Adjusted OIBDA total			8,074				9,812				-17.7	%			7,331				10.1	%
Mobile			3,212				3,633				-11.6	%			2,711				18.5	%
Fixed-line			4,862				6,179				-21.3	%			4,620				5.2	%
Adjusted OIBDA margin, %			45.4	%			51.2	%							42.9	%
UZBEKISTAN (US$ mln)*		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Adjusted OIBDA total			21.9				23.5				-6.8	%			20.1				9.0	%
Mobile			20.9				22.2				-5.9	%			19.2				8.9	%
Fixed-line			1.0				1.3				-23.1	%			0.9				11.1	%
Adjusted OIBDA margin, %			40.7	%			46.9	%							39.1	%
TAJIKISTAN (US$ mln)*		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Adjusted OIBDA total			8.8				5.2				69.2	%			6.7				31.3	%
Mobile			7.8				5.2				50.0	%			5.7				36.8	%
Fixed-line			1.0				—				n/a				1.0				0.0	%
Adjusted OIBDA margin, %			39.6	%			34.9	%							33.3	%
GEORGIA (GEL mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Adjusted OIBDA Total			6.4				1.6				300.0	%			2.7				137.0	%
Mobile			6.3				1.6				293.8	%			2.66				136.8	%
Fixed-line			0.12				—				n/a				0.05				140.0	%
Adjusted OIBDA margin, %			26.8	%			10.7	%							13.0	%
KYRGYZSTAN (KGS mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Adjusted Mobile OIBDA			569				—				n/a				589				-3.4	%
Adjusted Mobile OIBDA margin, %			41.6	%			—								46.7	%
CIS OIBDA (US$ mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Adjusted OIBDA total			176.0				154.7				13.8	%			161.9				8.7	%
Mobile			159.5				137.4				16.1	%			147.6				8.1	%
Fixed-line			16.5				17.3				-4.6	%			14.3				15.4	%
Adjusted OIBDA margin, %			48.8	%			52.1	%							48.2	%

 

*	US$ is the functional currency in Uzbekistan and Tajikistan.

 

 

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CIS — Operating Highlights

 

KAZAKHSTAN		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Mobile subscriptions (‘000)			6,736				6,835				-1.4	%			6,339				6.3	%
MOU, min			130.3				98.1				32.8	%			125.1				4.2	%
ARPU mobile, US$			9.6				8.2				17.1	%			9.6				0.0	%
ARPU mobile, (KZT)			1,419				1,241				14.3	%			1,411				0.6	%
Broadband internet subscriptions (‘000)			6.2				0.3				1966.7	%			4.3				44.2	%
ARMENIA		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Mobile subscriptions (‘000)			581				502				15.7	%			567				2.5	%
including mobile broadband subscriptions			7.4				0.0				n/a				6.6				12.1	%
MOU, min			286.7				269.0				6.6	%			270.1				6.1	%
ARPU mobile, US$			11.4				13.7				-16.8	%			10.3				10.7	%
ARPU mobile, (AMD)			4,176				5,117				-18.4	%			3,975				5.1	%
Broadband internet subscriptions (‘000)			57.8				18.1				219.3	%			49.7				16.3	%
UZBEKISTAN		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Mobile subscriptions (‘000)			4,398				3,652				20.4	%			3,997				10.0	%
including mobile broadband subscriptions			12.9				0.0				n/a				10.5				22.9	%
MOU, min			387.7				409.3				-5.3	%			383.0				1.2	%
ARPU mobile, US$			4.1				4.5				-8.9	%			4.1				0.0	%
Broadband internet subscriptions (‘000)			10.4				8.3				25.3	%			10.7				-2.8	%
TAJIKISTAN		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Mobile subscriptions (‘000)			772				706				9.3	%			784				-1.5	%
MOU, min			191.2				173.3				10.3	%			167.6				14.1	%
ARPU mobile, US$			7.1				7.2				-1.4	%			6.1				16.4	%
GEORGIA		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Mobile subscriptions (‘000)			529				341				55.1	%			466				13.5	%
MOU, min			147.4				129.3				14.0	%			140.5				4.9	%
ARPU mobile, US$			8.1				9.2				-12.0	%			7.9				2.5	%
ARPU mobile, (GEL)			14.9				15.4				-3.2	%			14.5				2.8	%
KYRGYZSTAN		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Mobile subscriptions (‘000)			1,766				—				n/a				1,722				2.6	%
MOU, min			288.2				—				n/a				235.9				22.2	%
ARPU mobile, US$			5.6				—				n/a				5.3				5.7	%
ARPU mobile, (KGS)			260.0				—				n/a				239.5				8.6	%

We no longer provide information on subscriptions market share, because different churn policies used by mobile service providers result in reported subscriptions market share figures that are not representative.

 

 

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Attachment F: Key Financial Results in US Dollars Russia *

 

RUSSIA (US$ millions)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			2,099.4				1,953.0				7.5	%			2,041.8				2.8	%
Adjusted OIBDA			987.9				995.0				-0.7	%			964.0				2.5	%
Adjusted OIBDA margin, %			47.1	%			50.9	%							47.2	%
SG&A			563.6				493.0				14.3	%			558.4				0.9	%
including Sales & Marketing Expenses			197.8				157.0				26.0	%			185.0				6.9	%
including General & Administrative Costs			365.8				336.0				8.9	%			373.4				-2.0	%
SG&A percentage			26.8	%			25.2	%							27.3	%
Capital expenditures			382.6				90.3				323.7	%			243.5				57.1	%
RUSSIA REVENUES (US$ millions)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			2,099.4				1,953.0				7.5	%			2,041.8				2.8	%
Mobile revenues			1,757.2				1,636.0				7.4	%			1,714.0				2.5	%
Fixed-line revenues			342.2				317.0				7.9	%			328.0				4.3	%
Business segment			156.9				160.0				-1.9	%			153.0				2.5	%
Wholesale			130.1				112.0				16.2	%			121.0				7.5	%
Residential			55.2				45.0				22.7	%			54.0				2.2	%
RUSSIA ADJUSTED OIBDA DEVELOPMENT (US$ millions)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Adjusted OIBDA total			987.9				995.0				-0.7	%			964.0				2.5	%
Mobile			886.2				895.0				-1.0	%			875.0				1.3	%
Fixed-line			101.8				100.0				1.8	%			89.0				14.4	%
Adjusted total OIBDA margin, %			47.1	%			50.9	%							47.2	%
Mobile, %			50.4	%			54.7	%							51.1	%
Fixed-line, %			29.7	%			31.5	%							27.1	%

 

*	Please find information on respective operating income amounts in the supplementary file FinancialOperatingQ32010.xls on our website at http://www.vimpelcom.com/news/qrep.wbp.

 

 

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Ukraine

 

UKRAINE ACTUAL (US$ millions)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			426.0				56.6				652.7	%			310.6				37.2	%
Adjusted OIBDA			242.2				12.1				1901.7	%			164.6				47.1	%
Adjusted OIBDA margin, %			56.9	%			21.4	%							53.0	%
SG&A			110.6				20.7				434.3	%			87.3				26.7	%
including Sales & Marketing Expenses			21.2				5.1				315.7	%			17.0				24.7	%
including General & Administrative Costs			89.4				15.6				473.1	%			70.3				27.2	%
SG&A percentage			26.0	%			36.6	%							28.4	%
Capital expenditures			51.0				3.0				1600.0	%			58.6				-13.0	%
UKRAINE ACTUAL REVENUES (US$ millions)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			426.0				56.6				652.7	%			310.6				37.2	%
Mobile			410.0				32.3				1169.3	%			291.4				40.7	%
Fixed-line			16.0				24.3				-34.2	%			19.2				-16.7	%
Business segment			9.5				10.4				-8.7	%			9.2				3.3	%
Wholesale			3.5				12.3				-71.5	%			7.1				-50.7	%
Residential			3.0				1.6				87.5	%			2.9				3.4	%
UKRAINE ACTUAL ADJISTED OIBDA DEVELOPMENT (US$ millions)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Adjusted OIBDA Total			242.2				12.1				1901.7	%			164.6				47.1	%
Mobile			240.1				6.4				3651.6	%			158.4				51.6	%
Fixed-line			2.1				5.7				-63.2	%			6.2				-66.1	%
Adjusted Total OIBDA margin, %			56.9	%			21.4	%							53.0	%
Mobile, %			58.6	%			19.8	%							54.4	%
Fixed-line, %			13.1	%			23.5	%							32.3	%

 

 

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CIS Revenues in US$

 

KAZAKHSTAN (US$ mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			197.4				171.9				14.8	%			184.3				7.1	%
Mobile			192.8				169.3				13.9	%			180.5				6.8	%
Fixed-line			4.6				2.6				76.9	%			3.8				21.1	%
ARMENIA (US$ mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			48.7				51.4				-5.3	%			44.5				9.4	%
Mobile			21.1				20.3				3.9	%			17.5				20.6	%
Fixed-line			27.6				31.1				-11.3	%			27.0				2.2	%
UZBEKISTAN (US$ mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			53.8				50.1				7.4	%			51.4				4.7	%
Mobile			51.4				46.8				9.8	%			48.9				5.1	%
Fixed-line			2.4				3.3				-27.3	%			2.5				-4.0	%
TAJIKISTAN (US$ mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			22.2				14.9				49.0	%			20.1				10.4	%
Mobile			16.5				14.9				10.7	%			14.9				10.7	%
Fixed-line			5.7				0.0				n/a				5.2				9.6	%
GEORGIA (US$ mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Net operating revenues			13.0				8.9				46.1	%			11.5				13.0	%
Mobile			12.6				8.9				41.6	%			11.1				13.5	%
Fixed-line			0.4				0.0				n/a				0.4				0.0	%
KYRGYZSTAN (US$ mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Mobile net operating revenues			29.3				0.0				n/a				27.5				6.5	%

 

 

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CIS Adjusted OIBDA in US$*

 

KAZAKHSTAN (US$ mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Adjusted OIBDA total			111.8				101.7				9.9	%			105.7				5.8	%
Mobile			110.2				101.7				8.4	%			104.9				5.1	%
Fixed-line			1.6				0.0				n/a				0.8				100.0	%
Adjusted OIBDA margin, %			56.6	%			59.2	%							57.4	%
ARMENIA (US$ mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Adjusted OIBDA total			22.1				26.3				-16.0	%			19.1				15.7	%
Mobile			8.8				9.8				-10.2	%			7.1				23.9	%
Fixed			13.3				16.5				-19.4	%			12.0				10.8	%
Adjusted OIBDA margin, %			45.4	%			51.2	%							42.9	%
UZBEKISTAN (US$ mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Adjusted OIBDA total			21.9				23.5				-6.8	%			20.1				9.0	%
Mobile			20.9				22.2				-5.9	%			19.2				8.9	%
Fixed-line			1.0				1.3				-23.1	%			0.9				11.1	%
OIBDA Margin, %			40.7	%			46.9	%							39.1	%
TAJIKISTAN (US$ mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Adjusted OIBDA total			8.8				5.2				69.2	%			6.7				31.3	%
Mobile			7.8				5.2				50.0	%			5.7				36.8	%
Fixed-line			1.0				—				n/a				1.0				0.0	%
Adjusted OIBDA margin, %			39.6	%			34.9	%							33.3	%
GEORGIA (US$ mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Adjusted OIBDA total			3.5				1.0				250.0	%			1.5				133.3	%
Mobile			3.5				1.0				250.0	%			1.5				133.3	%
Fixed-line			0.07				0.0				n/a				0.03				133.3	%
Adjusted OIBDA margin, %			26.9	%			11.2	%							13.0	%
KYRGYZSTAN (US$ mln)		3Q 10				3Q 09				3Q 10/ 3Q 09				2Q 10				3Q 10/ 2Q 10
Adjusted mobile OIBDA			12.2				—				n/a				12.8				-4.7	%
Adjusted mobile OIBDA margin, %			41.6	%			—								46.5	%

 

*	Please find information on respective operating income amounts in the supplementary file FinancialOperatingQ22010.xls on our website at http://www.vimpelcom.com/news/qrep.wbp.

 

 

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VimpelCom Ltd - Third Quarter 2010 Operating and Financial Results

 

 

Attachment G: VimpelCom Ltd Financial and Operational Highlights on Pro-Forma Basis*

 

CONSOLIDATED OPERATIONS (US$, millions)		3Q 10 (actual)				3Q 09 (pro-forma)				3Q 10/ 3Q 09				2Q 10 (pro-forma)				3Q 10/ 2Q 10				YTD 3Q 10 (pro-forma)				YTD 3Q 09 (pro-forma)
Net operating revenues			2,824.4				2,622.1				7.7	%			2,716.1				4.0	%			8,075.4				7,422.0
Adjusted OIBDA			1,377.7				1,345.4				2.4	%			1,307.0				5.4	%			3,892.4				3,789.4
Adjusted OIBDA margin, %			48.8	%			51.3	%							48.1	%							48.2	%			51.1	%
SG&A			799.1				699.6				14.2	%			786.2				1.6	%			2,323.6				1,998.2
SG&A percentage			28.3	%			26.7	%							28.9	%							28.8	%			26.9	%
Net income attributable to VimpelCom Ltd.			495.9				493.3				0.5	%			347.7				42.6	%			1,258.9				1,026.2
Net cash from operating activities			1,096.8				n/a								1,029.2				6.6	%			3,085.8				n/a
Capital expenditures			520.1				229.8				126.3	%			445.3				16.8	%			1,198.9				619.9

 

*	“Pro forma basis” means – that the numbers are presented assuming that the business combination with Kyivstar had taken place on January 1, 2009

Attachment H: Average Rates of Functional Currencies to USD*

 

Functional Currency/ 1 US$				1Q 09				2Q 09				3Q 09				4Q 09				1Q 10				2Q 10				3Q 10
Russia		RUR			33.93				32.21				31.33				29.47				29.89				30.24				30.62
Kazakhstan		KZT			138.85				150.47				150.75				149.77				147.68				146.81				147.40
Ukraine		UAH			7.70				7.66				7.82				7.99				7.99				7.92				7.90
Armenia		AMD			325.11				370.46				372.66				384.40				384.26				384.49				365.57
Georgia		GEL			1.67				1.66				1.68				1.68				1.72				1.80				1.84
Kyrgyzstan		KGS			—				—				—				—				44.55				45.75				46.74

 

•

Functional currencies in Tajikistan, Uzbekistan and Cambodia are US dollars.

 

 

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VimpelCom Ltd. Group

(in US$ millions, unless stated otherwise, unaudited)

 

CONSOLIDATED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			1,488				1,717				1,956				2,010				2,108				2,611				2,843				2,555				1,973.0				2,145.5				2,275.8				2,308.6				2,231.1				2,641.6				2,824.4
Gross margin			1,221				1,403				1,590				1,643				1,675				2,012				2,149				1,917				1,504.0				1,673.2				1,760.5				1,776.0				1,703.2				2,040.7				2,185.4
Gross margin, %			82.1	%			81.7	%			81.3	%			81.7	%			79.5	%			77.1	%			75.6	%			75.0	%			76.2	%			78.0	%			77.4	%			76.9	%			76.3	%			77.3	%			77.4	%
Adjusted OIBDA			766				897				1,015				918				1,126				1,223				1,388				1,124				948.7				1,087.6				1,148.3				1,087.9				1,041.2				1,261.8				1,377.7
Adjusted OIBDA, %			51.5	%			52.2	%			51.9	%			45.7	%			53.4	%			46.8	%			48.8	%			44.0	%			48.1	%			50.7	%			50.5	%			47.1	%			46.7	%			47.8	%			48.8	%
SG&A			439				494				557				716				528				774				749				787				538.0				573.5				599.2				679.8				643.3				766.4				799.1
including Sales & Marketing Expenses			136				167				186				219				187				215				242				285				156.0				168.2				184.1				218.1				190.8				230.3				232.3
including advertising			52				67				66				92				69				89				86				101				26.0				37.1				38.0				56.7				29.9				44.3				54.8
including General & Administrative Costs			303				327				371				497				341				559				507				502				382.0				405.3				415.1				461.7				452.5				536.1				566.8
SG&A, %			29.5	%			28.8	%			28.5	%			35.6	%			25.0	%			29.6	%			26.3	%			30.8	%			27.3	%			26.7	%			26.3	%			29.4	%			28.8	%			29.0	%			28.3	%
Net Income attributable to VimpelCom Ltd			277				359				458				368				601				470				269				-816				-297.0				700.5				434.5				283.4				381.5				334.7				495.9
Capital Expenditures			303.5				334.8				338.8				795.8				358.5				664.0				692.9				855.5				112.9				155.3				123.2				422.7				179.3				381.5				520.1
MOBILE		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			1,454				1,682				1,918				1,974				1,943				2,176				2,396				2,141				1,617.0				1,802.0				1,926.0				1,942.0				1,888.0				2,288.9				2,484.9
Subscriptions (‘000)			45,784				47,702				50,686				51,740				52,293				53,707				57,758				61,029				62,724				63,676				65,358				64,596				66,821				89,371				91,959
FIXED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			34.2				35.2				37.6				36.3				164.9				435.7				449.3				419.7				362.1				350.1				359.0				376.8				352.3				361.7				375.1
Broadband subscriptions (‘000)			0.0				0.0				0.0				0.0				542.1				617.1				785.5				1,221.3				1,559.9				1,738.8				1,930.0				2,256.8				2,527.2				2,744.8				3,065.5
BB subscritions using USB modems (‘000)			0.0				0.0				0.0				0.0				0.0				0.0				91.0				412.0				650.0				763.0				896.0				1,038.0				1,182.5				1,317.1				1,520.3
BB fixed-line subscriptions (‘000)			0.0				0.0				0.0				0.0				542.1				617.1				694.5				809.3				909.9				975.8				1,033.8				1,218.8				1,344.7				1,427.7				1,545.2
Reconciliation of Adjusted OIBDA Total		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			766				897				1,015				918				1,126				1,223				1,388				1,124				948.7				1,087.6				1,148.3				1,087.9				1,041.2				1,261.8				1,377.7
Depreciation			(269	)			(285	)			(286	)			(331	)			(357	)			(385	)			(400	)			(379	)			(308.6	)			(325.5	)			(366.0	)			(393.2	)			(352.5	)			(376.7	)			(408.3	)
Amortization			(53	)			(54	)			(55	)			(56	)			(67	)			(101	)			(98	)			(94	)			(72.6	)			(70.2	)			(71.2	)			(86.8	)			(66.7	)			(116.5	)			(137.8	)
Impairment loss			0				0				0				0				0				0				0				(443	)			0.0				0.0				0.0				0.0				0.0				0.0				0.0
Operating income			444				558				674				531				702				737				890				208				567.5				691.9				711.1				607.9				622.0				768.6				831.6
Interest income			5				8				9				12				15				25				18				14				14.8				18.8				7.7				10.4				11.5				16.1				14.6
Net foreign exchange gain/(loss)			17				8				26				22				185				26				(341	)			(1,012	)			(745.8	)			323.1				24.5				(14.1	)			104.9				(126.4	)			27.3
Interest expense			(46	)			(48	)			(51	)			(50	)			(79	)			(121	)			(142	)			(154	)			(137.4	)			(140.6	)			(156.8	)			(163.7	)			(141.7	)			(132.3	)			(125.7	)
Equity in net gain/(loss) of associates			0				0				0				0				0				0				2				(63	)			(35.3	)			4.7				4.9				(10.0	)			(3.8	)			11.1				19.2
Other (expense)/income, net			(11	)			(8	)			(9	)			31				(9	)			(3	)			(7	)			1				(6.5	)			0.6				(3.2	)			(24.0	)			(48.3	)			(10.0	)			(26.6	)
Income tax expense			(120	)			(144	)			(171	)			(159	)			(196	)			(179	)			(139	)			209				34.1				(191.4	)			(152.3	)			(125.4	)			(153.0	)			(178.0	)			(230.3	)
Net income/(loss)			289				374				478				387				618				485				281				(797	)			(308.6	)			707.1				435.9				281.1				391.6				349.1				510.1
Adjusted OIBDA margin as a percentage of net operating revenue			51.5	%			52.2	%			51.9	%			45.7	%			53.4	%			46.8	%			48.8	%			44.0	%			48.1	%			50.7	%			50.5	%			47.1	%			46.7	%			47.8	%			48.8	%
Depreciation			(18.1	%)			(16.6	%)			(14.6	%)			(16.5	%)			(16.9	%)			(14.7	%)			(14.1	%)			(14.9	%)			(15.6	%)			(15.2	%)			(16.2	%)			(17.0	%)			(15.8	%)			(14.3	%)			(14.5	%)
Amortization			(3.6	%)			(3.1	%)			(2.8	%)			(2.8	%)			(3.2	%)			(3.9	%)			(3.4	%)			(3.7	%)			(3.7	%)			(3.3	%)			(3.1	%)			(3.8	%)			(3.0	%)			(4.4	%)			(4.9	%)
Impairment loss			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			(17.3	%)			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income margin			29.8	%			32.5	%			34.5	%			26.4	%			33.3	%			28.2	%			31.3	%			8.1	%			28.8	%			32.2	%			31.2	%			26.3	%			27.9	%			29.1	%			29.4	%
Interest income			0.3	%			0.5	%			0.5	%			0.6	%			0.7	%			1.0	%			0.6	%			0.5	%			0.8	%			0.9	%			0.3	%			0.5	%			0.5	%			0.6	%			0.5	%
Net foreign exchange gain/(loss)			1.1	%			0.5	%			1.3	%			1.1	%			8.8	%			1.0	%			(12.0	%)			(39.6	%)			(37.8	%)			15.1	%			1.1	%			(0.6	%)			4.7	%			(4.8	%)			1.0	%
Interest expense			(3.1	%)			(2.8	%)			(2.6	%)			(2.5	%)			(3.7	%)			(4.6	%)			(5.0	%)			(6.0	%)			(7.0	%)			(6.6	%)			(6.9	%)			(7.1	%)			(6.4	%)			(5.0	%)			(4.5	%)
Equity in net gain/(loss) of associates			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.1	%			(2.5	%)			(1.8	%)			0.2	%			0.2	%			(0.4	%)			(0.2	%)			0.4	%			0.7	%
Other (expense)/income, net			(0.6	%)			(0.5	%)			(0.6	%)			1.6	%			(0.5	%)			(0.1	%)			(0.2	%)			0.1	%			(0.3	%)			0.1	%			0.0	%			(1.0	%)			(2.0	%)			(0.4	%)			(0.8	%)
Income tax expense			(8.1	%)			(8.4	%)			(8.7	%)			(7.9	%)			(9.3	%)			(6.9	%)			(4.9	%)			8.2	%			1.7	%			(8.9	%)			(6.7	%)			(5.4	%)			(6.9	%)			(6.7	%)			(8.2	%)
Net income/(loss) margin			19.4	%			21.8	%			24.4	%			19.3	%			29.3	%			18.6	%			9.9	%			(31.2	%)			(15.6	%)			33.0	%			19.2	%			12.2	%			17.6	%			13.2	%			18.1	%

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Russia

(in US$ millions, unless stated otherwise, unaudited)

 

CONSOLIDATED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			1,279				1,460				1,653				1,702				1,797				2,239				2,426				2,157				1,661				1,838				1,953				1,996				1,919				2,042				2,099
Gross margin			1,065				1,209				1,363				1,410				1,445				1,730				1,852				1,619				1,260				1,431				1,499				1,526				1,450				1,530				1,560
Gross margin, %			83.3	%			82.8	%			82.5	%			82.8	%			80.4	%			77.3	%			76.3	%			75.1	%			75.9	%			77.9	%			76.8	%			76.5	%			75.6	%			74.9	%			74.3	%
Adjusted OIBDA			676				780				871				773				988				1,068				1,213				945				806				948				995				948				911				964				988
Adjusted OIBDA, %			52.9	%			53.4	%			52.7	%			45.4	%			55.0	%			47.7	%			50.0	%			43.8	%			48.5	%			51.6	%			50.9	%			47.5	%			47.5	%			47.2	%			47.1	%
SG&A			375				419				477				633				438				650				629				670				438				474				493				570				524				558				564
including Sales & Marketing Expenses			114				141				159				186				158				181				203				246				132				146				157				191				166				185				198
including advertising			42				56				56				79				56				74				72				86				19				30				30				47				23				34				37
including General & Administrative Costs			261				278				318				447				280				469				426				424				306				328				336				379				358				373				366
SG&A, %			29.3	%			28.7	%			28.9	%			37.2	%			24.4	%			29.0	%			25.9	%			31.1	%			26.4	%			25.8	%			25.2	%			28.6	%			27.3	%			27.3	%			26.8	%
Net Income attributable to VimpelCom Ltd			280				356				423				364				614				457				256				-547				-282				691				457				325				391				333				458
Capital Expenditures			199.6				189.0				216.9				467.2				212.4				425.1				505.8				644.7				90.4				107.1				90.3				331.8				124.1				243.5				382.6
MOBILE		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			1,279				1,460				1,653				1,702				1,675				1,862				2,034				1,791				1,344				1,531				1,636				1,660				1,602				1,714				1,757
including Mobile Interconnect			171				203				224				253				252				269				285				257				190				212				220				238				228				247				250
Adjusted OIBDA			676				780				871				773				957				985				1,110				872				700				842				895				851				820				875				886
Adjusted OIBDA, %			52.9	%			53.4	%			52.7	%			45.4	%			57.1	%			52.9	%			54.6	%			48.7	%			52.1	%			55.0	%			54.7	%			51.3	%			51.2	%			51.1	%			50.4	%
Subscriptions (‘000)			38,631				40,140				41,802				42,221				42,079				42,485				45,093				47,677				49,351				49,971				51,028				50,886				51,254				50,912				51,615
ARPU, US$			10.9				12.3				13.4				13.5				13.2				14.7				15.2				12.5				9.1				10.1				10.6				10.8				10.3				10.9				11.2
MOU, min			160.9				192.6				208.9				204.1				198.7				220.3				228.5				227.8				203.0				211.8				213.6				217.7				203.9				219.3				222.1
Churn 3 months active base (quarterly), %			n/a				7.5	%			8.1	%			9.1	%			9.2	%			8.7	%			7.7	%			9.0	%			8.4	%			10.5	%			10.9	%			12.9	%			10.6	%			12.8	%			12.3	%
FIXED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			—				—				—				—				122				377				392				366				317				307				317				336				317				328				342
including business segment			—				—				—				—				68				207				213				200				171				164				160				162				150				153				157
including wholesale segment			—				—				—				—				40				123				133				118				105				99				112				121				114				121				130
including residential segment			—				—				—				—				14				47				46				48				41				44				45				53				53				54				55
Adjusted OIBDA			—				—				—				—				28				83				103				74				106				105				100				97				91				89				102
Adjusted OIBDA, %			—				—				—				—				23.0	%			22.0	%			26.3	%			20.2	%			33.4	%			34.2	%			31.5	%			28.9	%			28.7	%			27.1	%			29.7	%
Broadband subscriptions (‘000)			—				—				—				—				530				604				764				1,182				1,498				1,659				1,833				2,111				2,335				2,499				2,757
BB subscritions using USB modems (‘000)			—				—				—				—				0				0				91				412				650				763				896				1,038				1,168				1,300				1,500
BB fixed-line subscriptions (‘000)			—				—				—				—				0				604				673				770				848				896				937				1,073				1,167				1,199				1,257
Broadband services ARPU, blended, US$			—				—				—				—				17.6				16.9				15.4				13.7				11.0				10.2				10.6				11.9				11.2				10.1				9.8
Reconciliation of OIBDA Total		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			676				780				871				773				988				1,068				1,213				945				806				948				995				948				911				964				988
Depreciation			(232	)			(240	)			(250	)			(268	)			(287	)			(310	)			(332	)			(293	)			(242	)			(264	)			(291	)			(304	)			(279	)			(262	)			(270	)
Amortization			(29	)			(29	)			(29	)			(31	)			(35	)			(62	)			(54	)			(52	)			(39	)			(39	)			(40	)			(47	)			(41	)			(41	)			(41	)
Impairment loss			0				0				0				0				0				0				0				(353	)			0				0				0				0				0				0				0
Operating income			415				511				592				474				666				696				827				247				525				645				664				597				591				661				677
Interest income			9				13				15				18				23				34				28				27				28				33				22				25				27				28				24
Net foreign exchange gain/(loss)			7				4				26				17				183				4				(345	)			(753	)			(696	)			323				52				(14	)			106				(114	)			22
Interest expense			(40	)			(42	)			(45	)			(41	)			(73	)			(119	)			(139	)			(150	)			(137	)			(142	)			(157	)			(162	)			(144	)			(134	)			(123	)
Equity in net gain/(loss) of associates			0				0				0				0				0				0				2				(65	)			(38	)			10				12				5				2				19				28
Other (expense)/income, net			(6	)			(6	)			(11	)			27				1				1				(3	)			(1	)			1				1				1				(23	)			(47	)			(13	)			(3	)
Income tax expense			(104	)			(124	)			(154	)			(132	)			(183	)			(162	)			(113	)			148				35				(176	)			(141	)			(106	)			(144	)			(115	)			(165	)
Net income/(loss)			281				356				423				363				617				454				257				(547	)			(282	)			694				453				322				391				332				460
Adjusted OIBDA margin as a percentage of net operating revenue			52.9	%			53.4	%			52.7	%			45.4	%			55.0	%			47.7	%			50.0	%			43.8	%			48.5	%			51.6	%			50.9	%			47.5	%			47.5	%			47.2	%			47.1	%
Depreciation			(18.2	%)			(16.4	%)			(15.1	%)			(15.8	%)			(16.0	%)			(13.8	%)			(13.7	%)			(13.5	%)			(14.6	%)			(14.4	%)			(14.9	%)			(15.2	%)			(14.6	%)			(12.8	%)			(12.9	%)
Amortization			(2.3	%)			(2.0	%)			(1.8	%)			(1.8	%)			(1.9	%)			(2.8	%)			(2.2	%)			(2.4	%)			(2.3	%)			(2.1	%)			(2.0	%)			(2.4	%)			(2.1	%)			(2.0	%)			(1.9	%)
Impairment loss			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			(16.4	%)			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income			32.4	%			35.0	%			35.8	%			27.8	%			37.1	%			31.1	%			34.1	%			11.5	%			31.6	%			35.1	%			34.0	%			29.9	%			30.8	%			32.4	%			32.3	%
Interest income			0.7	%			0.9	%			0.9	%			1.1	%			1.3	%			1.5	%			1.2	%			1.3	%			1.7	%			1.8	%			1.1	%			1.3	%			1.4	%			1.4	%			1.2	%
Net foreign exchange gain/(loss)			0.5	%			0.3	%			1.6	%			1.0	%			10.2	%			0.2	%			(14.2	%)			(35.0	%)			(41.8	%)			17.6	%			2.7	%			(0.7	%)			5.5	%			(5.6	%)			1.0	%
Interest expense			(3.1	%)			(2.9	%)			(2.7	%)			(2.4	%)			(4.1	%)			(5.3	%)			(5.7	%)			(7.0	%)			(8.2	%)			(7.7	%)			(8.0	%)			(8.1	%)			(7.5	%)			(6.6	%)			(5.8	%)
Equity in net gain/(loss) of associates			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.1	%			(3.0	%)			(2.3	%)			0.5	%			0.6	%			0.3	%			0.1	%			0.9	%			1.3	%
Other (expense)/income, net			(0.4	%)			(0.4	%)			(0.7	%)			1.6	%			0.1	%			0.0	%			(0.2	%)			0.0	%			0.1	%			0.1	%			0.1	%			(1.3	%)			(2.4	%)			(0.6	%)			(0.1	%)
Income tax expense			(8.1	%)			(8.5	%)			(9.3	%)			(7.8	%)			(10.2	%)			(7.2	%)			(4.7	%)			6.9	%			2.1	%			(9.6	%)			(7.2	%)			(5.3	%)			(7.5	%)			(5.6	%)			(7.8	%)
Net income/(loss)			22.0	%			24.4	%			25.6	%			21.3	%			34.3	%			20.3	%			10.6	%			(25.4	%)			(17.0	%)			37.8	%			23.2	%			16.1	%			20.4	%			16.3	%			21.9	%
Reconciliation of Adjusted OIBDA Mobile		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			676.0				780.0				871.0				773.0				956				985				1,110				872				700				842				895				850				820				875				886
Depreciation			(232.0	)			(240.0	)			(250.0	)			(268.0	)			(277	)			(284	)			(278	)			(253	)			(213	)			(230	)			(240	)			(260	)			(240	)			(227	)			(235	)
Amortization			(29.0	)			(29.0	)			(29.0	)			(31.0	)			(29	)			(30	)			(29	)			(26	)			(18	)			(19	)			(19	)			(20	)			(20	)			(20	)			(20	)
Impairment loss			0				0				0				0				0				0				0				(22	)			0				0				0				0				0				0				0
Operating income			415.0				511.0				592.0				474.0				650				671				803				571				469				593				636				570				560				628				631
Interest income			9.0				13.0				15.0				18.0				33				59				59				(51	)			25				30				24				25				26				28				28
Net foreign exchange gain/(loss)			7.0				4.0				26.0				17.0				175				3				(315	)			(682	)			(636	)			282				39				(12	)			97				(98	)			17
Interest expense			(40.0	)			(42.0	)			(45.0	)			(41.0	)			(72	)			(116	)			(136	)			(142	)			(133	)			(139	)			(160	)			(164	)			(149	)			(140	)			(128	)
Equity in net gain/(loss) of associates			—				—				—				—				0				0				0				(65	)			(39	)			9				11				4				2				18				27
Other (expense)/income, net			(6.0	)			(6.0	)			(11.0	)			27.0				0				0				(10	)			(6	)			(2	)			0				2				(24	)			1				(1	)			(5	)
Income tax expense			(104.0	)			(124.0	)			(154.0	)			(132.0	)			(175	)			(148	)			(103	)			115				38				(157	)			(127	)			(93	)			(106	)			(92	)			(130	)
Net income/(loss)			281.0				356.0				423.0				363.0				611				469				298				(260	)			(278	)			618				425				306				431				343				440
Adjusted OIBDA margin mobile as a percentage of net operating revenue			52.9	%			53.4	%			52.7	%			45.4	%			57.1	%			52.9	%			54.6	%			48.7	%			52.1	%			55.0	%			54.7	%			51.2	%			51.2	%			51.1	%			50.4	%
Depreciation			(18.2	%)			(16.4	%)			(15.1	%)			(15.8	%)			(16.5	%)			(15.3	%)			(13.7	%)			(14.1	%)			(15.8	%)			(15.0	%)			(14.7	%)			(15.7	%)			(15.0	%)			(13.2	%)			(13.4	%)
Amortization			(2.3	%)			(2.0	%)			(1.8	%)			(1.8	%)			(1.7	%)			(1.6	%)			(1.4	%)			(1.5	%)			(1.3	%)			(1.2	%)			(1.2	%)			(1.2	%)			(1.2	%)			(1.2	%)			(1.1	%)
Impairment loss			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			(1.2	%)			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income margin			32.4	%			35.0	%			35.8	%			27.8	%			38.8	%			36.0	%			39.5	%			31.9	%			34.9	%			38.7	%			38.9	%			34.3	%			35.0	%			36.6	%			35.9	%
Interest income			0.7	%			0.9	%			0.9	%			1.1	%			2.0	%			3.2	%			2.9	%			(2.8	%)			1.9	%			2.0	%			1.5	%			1.5	%			1.6	%			1.6	%			1.6	%
Net foreign exchange gain/(loss)			0.5	%			0.3	%			1.6	%			1.0	%			10.4	%			0.2	%			(15.5	%)			(38.1	%)			(47.3	%)			18.4	%			2.4	%			(0.7	%)			6.1	%			(5.7	%)			0.9	%
Interest expense			(3.1	%)			(2.9	%)			(2.7	%)			(2.4	%)			(4.3	%)			(6.2	%)			(6.7	%)			(7.9	%)			(9.9	%)			(9.1	%)			(9.8	%)			(9.9	%)			(9.3	%)			(8.2	%)			(7.3	%)
Equity in net gain/(loss) of associates			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			(3.6	%)			(2.9	%)			0.6	%			0.7	%			0.2	%			0.1	%			1.1	%			1.5	%
Other (expense)/income, net			(0.4	%)			(0.4	%)			(0.7	%)			1.6	%			0.0	%			0.0	%			(0.5	%)			(0.3	%)			(0.1	%)			0.0	%			0.1	%			(1.4	%)			0.1	%			(0.1	%)			(0.3	%)
Income tax expense			(8.1	%)			(8.5	%)			(9.3	%)			(7.8	%)			(10.4	%)			(7.9	%)			(5.1	%)			6.4	%			2.8	%			(10.3	%)			(7.8	%)			(5.6	%)			(6.6	%)			(5.4	%)			(7.4	%)
Net income/(loss) margin			22.0	%			24.4	%			25.6	%			21.3	%			36.5	%			25.2	%			14.7	%			(14.5	%)			(20.7	%)			40.4	%			26.0	%			18.4	%			26.9	%			20.0	%			25.1	%
Reconciliation of Adjusted OIBDA Fixed		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			—				—				—				—				28.0				83.0				102.0				74.0				106.0				105.0				100.0				97.0				91.0				89.0				101.8
Depreciation			—				—				—				—				(10.0	)			(27.0	)			(54.0	)			(42.0	)			(29.0	)			(33.0	)			(51.0	)			(44.0	)			(38.0	)			(35.0	)			(34.8	)
Amortization			—				—				—				—				(6.0	)			(31.0	)			(24.0	)			(25.0	)			(21.0	)			(20.0	)			(21.0	)			(26.0	)			(22.0	)			(21.0	)			(21.1	)
Impairment loss			—				—				—				—				—				—				—				(315.0	)			—				—				—				—				—				—				—
Operating income			—				—				—				—				12.0				25.0				24.0				(308.0	)			56.0				52.0				28.0				27.0				31.0				33.0				45.9
Interest income			—				—				—				—				1.0				9.0				3.0				3.0				3.0				3.0				—				6.0				8.0				9.0				6.7
Net foreign exchange gain/(loss)			—				—				—				—				8.0				1.0				(31.0	)			(72.0	)			(60.0	)			41.0				13.0				(2.0	)			9.0				(16.0	)			4.9
Interest expense			—				—				—				—				(12.0	)			(37.0	)			(37.0	)			67.0				(4.0	)			(3.0	)			1.0				(3.0	)			(3.0	)			(3.0	)			(5.2	)
Equity in net gain/(loss) of associates			—				—				—				—				—				—				2.0				—				1.0				1.0				1.0				1.0				—				1.0				0.9
Other (expense)/income, net			—				—				—				—				3.0				1.1				7.9				4.9				3.0				(0.1	)			(1.1	)			0.1				(47.9	)			(11.0	)			2.2
Income tax expense			—				—				—				—				(8.0	)			(14.0	)			(10.0	)			33.0				(4.0	)			(19.0	)			(13.0	)			(13.0	)			(38.0	)			(23.0	)			(35.1	)
Net income/(loss)			—				—				—				—				4.0				(14.9	)			(41.1	)			(272.1	)			(5.0	)			74.9				28.9				16.1				(40.9	)			(10.0	)			20.3
Adjusted OIBDA margin fixed as a percentage of net operating revenue			—				—				—				—				23.0	%			22.0	%			26.0	%			20.2	%			33.4	%			34.2	%			31.5	%			28.9	%			28.7	%			27.1	%			29.7	%
Depreciation			—				—				—				—				(8.2	%)			(7.2	%)			(13.8	%)			(11.5	%)			(9.1	%)			(10.7	%)			(16.1	%)			(13.1	%)			(12.0	%)			(10.7	%)			(10.2	%)
Amortization			—				—				—				—				(4.9	%)			(8.2	%)			(6.1	%)			(6.8	%)			(6.6	%)			(6.5	%)			(6.6	%)			(7.7	%)			(6.9	%)			(6.4	%)			(6.2	%)
Impairment loss			—				—				—				—				0.0	%			0.0	%			0.0	%			(86.1	%)			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income margin			—				—				—				—				9.8	%			6.6	%			6.1	%			(84.2	%)			17.7	%			16.9	%			8.8	%			8.0	%			9.8	%			10.1	%			13.4	%
Interest income			—				—				—				—				0.8	%			2.4	%			0.8	%			0.8	%			0.9	%			1.0	%			0.0	%			1.8	%			2.5	%			2.7	%			2.0	%
Net foreign exchange gain/(loss)			—				—				—				—				6.6	%			0.3	%			(7.9	%)			(19.7	%)			(18.9	%)			13.4	%			4.1	%			(0.6	%)			2.8	%			(4.9	%)			1.4	%
Interest expense			—				—				—				—				(9.8	%)			(9.8	%)			(9.4	%)			18.3	%			(1.3	%)			(1.0	%)			0.3	%			(0.9	%)			(0.9	%)			(0.9	%)			(1.5	%)
Equity in net gain/(loss) of associates			—				—				—				—				0.0	%			0.0	%			0.5	%			0.0	%			0.3	%			0.3	%			0.3	%			0.3	%			0.0	%			0.3	%			0.3	%
Other (expense)/income, net			—				—				—				—				2.5	%			0.3	%			2.0	%			1.3	%			0.9	%			(0.0	%)			(0.3	%)			0.0	%			(15.1	%)			(3.4	%)			0.6	%
Income tax expense			—				—				—				—				(6.6	%)			(3.7	%)			(2.6	%)			9.0	%			(1.3	%)			(6.2	%)			(4.1	%)			(3.9	%)			(12.0	%)			(7.0	%)			(10.3	%)
Net income/(loss) margin			—				—				—				—				3.3	%			(4.0	%)			(10.5	%)			(74.3	%)			(1.6	%)			24.4	%			9.1	%			4.8	%			(12.9	%)			(3.0	%)			5.9	%

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Table of Contents

Ukraine

(in US$ millions, unless stated otherwise, unaudited)

 

CONSOLIDATED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			16.3				23.8				37.0				34.5				44.8				71.2				94.2				70.5				47.4				51.1				56.6				48.1				44.9				310.6				426.0
Gross margin			9.5				13.5				23.3				20.9				26.7				39.5				31.6				33.9				26.6				30.1				33.4				26.5				28.5				253.9				351.0
Gross margin, %			58.3	%			56.7	%			63.0	%			60.6	%			59.6	%			55.5	%			33.5	%			48.1	%			56.1	%			58.9	%			59.0	%			55.1	%			63.5	%			81.7	%			82.4	%
Adjusted OIBDA			-6.5				-3.1				6.5				3.6				3.2				9.4				-1.6				11.6				6.3				10.0				12.1				7.6				10.1				164.6				242.2
Adjusted OIBDA, %			n/a				n/a				17.6	%			10.4	%			7.1	%			13.2	%			n/a				16.5	%			13.3	%			19.6	%			21.4	%			15.8	%			22.5	%			53.0	%			56.9	%
SG&A			16.0				16.5				16.5				17.5				23.4				30.0				32.7				21.6				19.5				19.5				20.7				18.7				18.3				87.3				110.6
including Sales & Marketing Expenses			5.8				5.5				5.3				5.2				6.7				7.9				8.7				4.7				3.5				3.8				5.1				3.5				3.3				17.0				21.2
including advertising			3.9				3.7				2.7				3.5				4.7				5.1				4.5				1.9				1.7				1.6				2.3				1.6				0.9				7.2				7.1
including General & Administrative Costs			10.2				11.0				11.2				12.3				16.7				22.1				24.0				16.9				16.0				15.7				15.6				15.2				15.0				70.3				89.4
SG&A, %			98.2	%			69.3	%			44.6	%			50.7	%			52.2	%			42.1	%			34.7	%			30.6	%			41.1	%			38.2	%			36.6	%			38.9	%			40.8	%			28.1	%			26.0	%
Net Income attributable to VimpelCom Ltd			-18.4				-17.2				-6.4				-17.6				-19.7				-5.8				-36.7				-323.1				-14.4				-10.5				-38.2				-26.9				-7.8				29.8				73.1
Capital Expenditures			29.3				46.0				26.0				55.2				26.5				54.1				46.9				57.9				2.9				2.9				3.0				11.0				6.0				58.6				51.0
MOBILE		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			16.3				23.8				37.0				34.5				36.3				44.9				66.3				46.3				25.7				28.6				32.3				23.8				22.9				291.4				410.0
including Mobile Interconnect			5.4				7.6				10.9				10.9				11.5				12.6				18.0				13.9				8.2				8.0				8.0				6.8				5.5				59.2				73.4
Adjusted OIBDA			-6.5				-3.1				6.5				3.6				1.5				3.9				-6.3				6.6				1.2				3.8				6.4				2.2				3.5				158.4				240.1
Adjusted OIBDA, %			n/a				n/a				17.6	%			10.4	%			4.1	%			8.7	%			n/a				14.3	%			4.7	%			13.3	%			19.8	%			9.2	%			15.3	%			54.4	%			58.6	%
Subscriptions (‘000)			1,953				1,822				2,212				1,941				1,971				2,111				2,403				2,052				1,894				1,934				2,199				2,005				1,951				24,059				25,057
ARPU, US$			3.0				4.2				5.8				5.6				6.1				7.5				9.7				7.0				4.5				5.2				5.4				3.9				3.8				5.0				5.4
MOU, min			138.0				159.9				168.2				183.2				210.2				231.0				261.5				230.0				213.3				217.8				203.7				201.3				197.2				426.7				433.2
Churn 3 months active base (quarterly), %			n/a				n/a				n/a				35.8	%			20.1	%			16.9	%			15.9	%			32.2	%			21.9	%			15.1	%			14.4	%			29.4	%			18.5	%			6.3	%			5.3	%
FIXED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			—				—				—				—				8.5				26.3				27.9				24.2				21.7				22.5				24.3				24.3				22.0				19.2				16.0
including business segment			—				—				—				—				5.5				16.9				18.9				14.8				11.1				10.2				10.4				10.3				9.4				9.2				9.5
including wholesale segment			—				—				—				—				2.5				8.1				7.6				8.0				9.3				10.7				12.3				12.4				10.0				7.1				3.5
including residential segment			—				—				—				—				0.4				1.3				1.4				1.4				1.3				1.6				1.6				1.6				2.6				2.9				3.0
Adjusted OIBDA			—				—				—				—				1.7				5.5				4.7				5.0				5.1				6.2				5.7				5.4				6.6				6.2				2.1
Adjusted OIBDA, %			—				—				—				—				20.0	%			20.9	%			16.8	%			20.7	%			23.5	%			27.6	%			23.5	%			22.2	%			30.0	%			32.3	%			13.1	%
Broadband subscriptions (‘000)			—				—				—				—				12.1				13.1				16.1				24.1				39.6				52.7				70.1				109.3				133.8				164.0				213.8
BB subscritions using USB modems (‘000)			—				—				—				—				0.0				0.0				0.0				0.0				0.0				0.0				0.0				0.0				0.0				0.0				0.0
BB fixed-line subscriptions (‘000)			—				—				—				—				12.1				13.1				16.1				24.1				39.6				52.7				70.1				109.3				133.8				164.0				213.8
Reconciliation of OIBDA Total		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			-6.5				-3.1				6.5				3.6				3.2				9.4				-1.6				11.6				6.3				10.0				12.1				7.6				10.1				164.6				242.2
Depreciation			(3.2	)			(4.3	)			(4.5	)			(13.0	)			(11.2	)			(15.0	)			(18.0	)			(14.9	)			(10.7	)			(11.9	)			(14.1	)			(13.7	)			(10.6	)			(54.3	)			(67.8	)
Amortization			(5.2	)			(5.2	)			(5.2	)			(3.1	)			(7.2	)			(12.4	)			(12.8	)			(10.3	)			(6.8	)			(6.8	)			(6.7	)			(16.1	)			(4.3	)			(53.5	)			(68.5	)
Impairment loss			—				—				—				—				—				—				—				(90.1	)			—				—				—				—				—				—				—
Operating income			(14.9	)			(12.6	)			(3.2	)			(12.5	)			(15.2	)			(18.0	)			(32.4	)			(103.7	)			(11.2	)			(8.7	)			(8.7	)			(22.2	)			(4.8	)			56.8				105.9
Interest income			—				—				—				—				—				—				—				—				0.1				—				0.1				0.1				0.1				3.7				5.7
Net foreign exchange gain/(loss)			(0.2	)			—				—				—				—				17.2				(1.3	)			(230.8	)			—				4.3				(25.9	)			1.6				3.8				(4.7	)			7.0
Interest expense			(3.4	)			(4.7	)			(4.9	)			(5.2	)			(5.0	)			(4.8	)			(5.4	)			(7.0	)			(4.7	)			(5.2	)			(6.3	)			(6.2	)			(6.7	)			(7.0	)			(6.8	)
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Other (expense)/income, net			—				(0.2	)			(0.2	)			(0.7	)			(1.0	)			(0.7	)			(0.3	)			2.1				—				(1.0	)			(1.7	)			(0.6	)			—				(4.4	)			(5.8	)
Income tax expense			0.1				0.3				1.9				0.8				1.6				0.9				4.0				14.4				1.2				(0.6	)			4.1				(2.3	)			(0.2	)			(14.7	)			(32.7	)
Net income/(loss)			(18.4	)			(17.2	)			(6.4	)			(17.6	)			(19.6	)			(5.4	)			(35.4	)			(325.0	)			(14.6	)			(11.2	)			(38.4	)			(29.6	)			(7.8	)			29.7				73.3
Adjusted OIBDA margin as a percentage of net operating revenue			n/a				n/a				17.6	%			10.4	%			7.1	%			13.2	%			n/a				16.5	%			13.3	%			19.6	%			21.4	%			15.8	%			22.5	%			53.0	%			56.9	%
Depreciation			n/a				n/a				(12.1	%)			(37.6	%)			(24.9	%)			(21.1	%)			n/a				(21.2	%)			(22.6	%)			(23.3	%)			(25.0	%)			(28.5	%)			(23.6	%)			(17.5	%)			(15.9	%)
Amortization			n/a				n/a				(14.1	%)			(9.0	%)			(16.1	%)			(17.4	%)			n/a				(14.6	%)			(14.3	%)			(13.3	%)			(11.8	%)			(33.5	%)			(9.6	%)			(17.2	%)			(16.1	%)
Impairment loss			n/a				n/a				0.0	%			0.0	%			0.0	%			0.0	%			n/a				(127.8	%)			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income			n/a				n/a				(8.6	%)			(36.2	%)			(33.9	%)			(25.3	%)			n/a				(147.1	%)			(23.6	%)			(17.0	%)			(15.4	%)			(46.2	%)			(10.7	%)			18.3	%			24.9	%
Interest income			n/a				n/a				0.0	%			0.0	%			0.0	%			0.0	%			n/a				0.0	%			0.2	%			0.0	%			0.2	%			0.2	%			0.2	%			1.2	%			1.3	%
Net foreign exchange gain/(loss)			n/a				n/a				0.0	%			0.0	%			0.0	%			24.2	%			n/a				(327.4	%)			0.0	%			8.4	%			(45.8	%)			3.3	%			8.5	%			(1.5	%)			1.6	%
Interest expense			n/a				n/a				(13.2	%)			(15.1	%)			(11.2	%)			(6.7	%)			n/a				(9.9	%)			(9.9	%)			(10.2	%)			(11.1	%)			(12.9	%)			(14.9	%)			(2.3	%)			(1.6	%)
Equity in net gain/(loss) of associates			n/a				n/a				0.0	%			0.0	%			0.0	%			0.0	%			n/a				0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Other (expense)/income, net			n/a				n/a				(0.6	%)			(2.0	%)			(2.3	%)			(1.1	%)			n/a				3.0	%			0.0	%			(1.9	%)			(2.9	%)			(1.1	%)			(0.1	%)			(1.4	%)			(1.4	%)
Income tax expense			n/a				n/a				5.1	%			2.3	%			3.6	%			1.3	%			n/a				20.4	%			2.5	%			(1.2	%)			7.2	%			(4.8	%)			(0.4	%)			(4.7	%)			(7.7	%)
Net income/(loss)			n/a				n/a				(17.3	%)			(51.0	%)			(43.8	%)			(7.6	%)			n/a				(461.0	%)			(30.8	%)			(21.9	%)			(67.8	%)			(61.5	%)			(17.4	%)			9.6	%			17.2	%
Reconciliation of Adjusted OIBDA Mobile		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			(6.5	)			(3.1	)			6.5				3.6				1.4				3.9				(6.3	)			6.6				1.2				3.8				6.4				2.2				3.5				158.4				240.1
Depreciation			(3.2	)			(4.3	)			(4.5	)			(13.0	)			(9.9	)			(11.5	)			(16.2	)			(12.4	)			(8.7	)			(9.9	)			(10.7	)			(11.3	)			(8.6	)			(51.2	)			(65.0	)
Amortization			(5.2	)			(5.2	)			(5.2	)			(3.1	)			(6.8	)			(10.4	)			(10.9	)			(8.3	)			(5.6	)			(5.8	)			(5.8	)			(5.7	)			(3.2	)			(53.4	)			(67.7	)
Impairment loss			—				—				—				—				—				—				—				(90.1	)			—				—				—				—				—				—				—
Operating income			(14.9	)			(12.6	)			(3.2	)			(12.5	)			(15.3	)			(18.0	)			(33.4	)			(104.2	)			(13.1	)			(11.9	)			(10.1	)			(14.8	)			(8.3	)			53.8				107.4
Interest income			—				—				—				—				—				—				—				0.1				0.1				—				—				0.1				—				3.6				5.6
Net foreign exchange gain/(loss)			(0.2	)			—				—				—				(0.1	)			16.5				(1.0	)			(215.8	)			(0.1	)			4.1				(24.3	)			1.4				3.6				(4.8	)			7.0
Interest expense			(3.4	)			(4.7	)			(4.9	)			(5.2	)			(4.7	)			(4.4	)			(4.8	)			(5.9	)			(4.0	)			(4.4	)			(5.6	)			(5.6	)			(5.6	)			(6.0	)			(6.0	)
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Other (expense)/income, net			—				(0.2	)			(0.2	)			(0.7	)			(0.7	)			(0.8	)			(0.4	)			2.3				—				—				(1.5	)			(0.8	)			(0.1	)			(4.3	)			(6.0	)
Income tax expense			0.1				0.3				1.9				0.8				1.3				2.2				0.2				7.9				0.9				0.8				1.0				1.0				—				(14.6	)			(31.5	)
Net income/(loss)			(18.4	)			(17.2	)			(6.4	)			(17.6	)			(19.5	)			(4.5	)			(39.4	)			(315.6	)			(16.2	)			(11.4	)			(40.5	)			(18.7	)			(10.4	)			27.7				76.5
Adjusted OIBDA margin mobile as a percentage of net operating revenue			n/a				n/a				17.6	%			10.4	%			3.9	%			8.7	%			n/a				14.3	%			4.7	%			13.3	%			19.8	%			9.2	%			15.3	%			54.4	%			58.6	%
Depreciation			n/a				n/a				(12.1	%)			(37.6	%)			(27.3	%)			(25.6	%)			n/a				(26.8	%)			(33.9	%)			(34.6	%)			(33.1	%)			(47.5	%)			(37.6	%)			(17.6	%)			(15.9	%)
Amortization			n/a				n/a				(14.1	%)			(9.0	%)			(18.7	%)			(23.2	%)			n/a				(17.9	%)			(21.8	%)			(20.3	%)			(18.0	%)			(23.9	%)			(14.0	%)			(18.3	%)			(16.5	%)
Impairment loss			n/a				n/a				0.0	%			0.0	%			0.0	%			0.0	%			n/a				(194.6	%)			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income margin			n/a				n/a				(8.6	%)			(36.2	%)			(42.1	%)			(40.1	%)			n/a				(225.1	%)			(51.0	%)			(41.6	%)			(31.3	%)			(62.2	%)			(36.2	%)			18.5	%			26.2	%
Interest income			n/a				n/a				0.0	%			0.0	%			0.0	%			0.0	%			n/a				0.2	%			0.4	%			0.0	%			0.0	%			0.4	%			0.0	%			1.2	%			1.4	%
Net foreign exchange gain/(loss)			n/a				n/a				0.0	%			0.0	%			(0.3	%)			36.7	%			n/a				(466.1	%)			(0.4	%)			14.3	%			(75.2	%)			5.9	%			15.7	%			(1.6	%)			1.7	%
Interest expense			n/a				n/a				(13.2	%)			(15.1	%)			(12.9	%)			(9.8	%)			n/a				(12.7	%)			(15.6	%)			(15.4	%)			(17.3	%)			(23.5	%)			(24.5	%)			(2.1	%)			(1.5	%)
Equity in net gain/(loss) of associates			n/a				n/a				0.0	%			0.0	%			0.0	%			0.0	%			n/a				0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Other (expense)/income, net			n/a				n/a				(0.6	%)			(2.0	%)			(1.9	%)			(1.8	%)			n/a				5.0	%			0.0	%			0.0	%			(4.6	%)			(3.4	%)			(0.4	%)			(1.5	%)			(1.5	%)
Income tax expense			n/a				n/a				5.1	%			2.3	%			3.6	%			4.9	%			n/a				17.1	%			3.5	%			2.8	%			3.1	%			4.2	%			0.0	%			(5.0	%)			(7.7	%)
Net income/(loss) margin			n/a				n/a				(17.3	%)			(51.0	%)			(53.7	%)			(10.0	%)			n/a				(681.6	%)			(63.0	%)			(39.9	%)			(125.4	%)			(78.6	%)			(45.4	%)			9.5	%			18.7	%
Reconciliation of Adjusted OIBDA Fixed		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			—				—				—				—				1.4				5.5				4.7				5.0				5.1				6.2				5.7				5.4				6.6				6.2				2.1
Depreciation			—				—				—				—				(1.3	)			(3.5	)			(1.3	)			(2.5	)			(1.9	)			(2.0	)			(3.4	)			(2.3	)			(2.1	)			(2.6	)			(2.8	)
Amortization			—				—				—				—				(0.4	)			(2.0	)			(1.9	)			(1.9	)			(1.2	)			(1.0	)			(0.9	)			(10.5	)			(1.1	)			(0.6	)			(0.8	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			—				—				—				—				(0.3	)			—				1.5				0.6				2.0				3.2				1.4				(7.4	)			3.4				3.0				(1.5	)
Interest income			—				—				—				—				—				—				—				—				—				—				—				0.1				0.1				0.2				0.2
Net foreign exchange gain/(loss)			—				—				—				—				—				0.7				(0.4	)			(15.0	)			0.1				0.2				(1.6	)			0.2				0.3				0.1				—
Interest expense			—				—				—				—				(0.3	)			(0.4	)			(0.6	)			(1.1	)			(0.7	)			(0.8	)			(0.6	)			(0.6	)			(1.0	)			(1.0	)			(0.8	)
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Other (expense)/income, net			—				—				—				—				0.3				(0.1	)			0.1				(0.2	)			—				(1.0	)			(0.3	)			0.2				—				(0.1	)			—
Income tax expense			—				—				—				—				0.3				(1.2	)			3.8				6.5				0.4				(1.4	)			3.1				(3.4	)			(0.2	)			(0.1	)			—
Net income/(loss)			—				—				—				—				—				(1.0	)			4.4				(9.2	)			1.8				0.2				2.0				(10.9	)			2.6				2.1				(2.1	)
Adjusted OIBDA margin fixed as a percentage of net operating revenue			0.0	%			0.0	%			0.0	%			0.0	%			16.5	%			20.9	%			16.8	%			20.7	%			23.5	%			27.6	%			23.5	%			22.2	%			30.0	%			32.3	%			13.1	%
Depreciation			0.0	%			0.0	%			0.0	%			0.0	%			(15.3	%)			(13.3	%)			(4.7	%)			(10.3	%)			(8.8	%)			(8.9	%)			(14.0	%)			(9.5	%)			(9.5	%)			(13.5	%)			(17.5	%)
Amortization			0.0	%			0.0	%			0.0	%			0.0	%			(4.7	%)			(7.6	%)			(6.8	%)			(7.9	%)			(5.5	%)			(4.4	%)			(3.7	%)			(43.2	%)			(5.0	%)			(3.1	%)			(5.0	%)
Impairment loss			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income margin			0.0	%			0.0	%			0.0	%			0.0	%			(3.5	%)			0.0	%			5.4	%			2.5	%			9.2	%			14.2	%			5.8	%			(30.5	%)			15.5	%			15.6	%			(9.4	%)
Interest income			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.4	%			0.5	%			1.0	%			1.3	%
Net foreign exchange gain/(loss)			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			2.7	%			(1.4	%)			(62.0	%)			0.5	%			0.9	%			(6.6	%)			0.8	%			1.4	%			0.5	%			0.0	%
Interest expense			0.0	%			0.0	%			0.0	%			0.0	%			(3.5	%)			(1.5	%)			(2.2	%)			(4.5	%)			(3.2	%)			(3.6	%)			(2.5	%)			(2.5	%)			(4.5	%)			(5.2	%)			(5.0	%)
Equity in net gain/(loss) of associates			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Other (expense)/income, net			0.0	%			0.0	%			0.0	%			0.0	%			3.5	%			(0.4	%)			0.4	%			(0.8	%)			0.0	%			(4.4	%)			(1.2	%)			0.8	%			0.0	%			(0.5	%)			0.0	%
Income tax expense			0.0	%			0.0	%			0.0	%			0.0	%			3.5	%			(4.6	%)			13.6	%			26.9	%			1.8	%			(6.2	%)			12.8	%			(14.0	%)			(0.9	%)			(0.5	%)			0.0	%
Net income/(loss) margin			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			(3.8	%)			15.8	%			(38.0	%)			8.3	%			0.9	%			8.2	%			(44.9	%)			11.8	%			10.9	%			(13.1	%)

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Table of Contents

CIS

(in US$ millions, unless stated otherwise, unaudited)

 

CONSOLIDATED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			194.6				236.3				268.6				280.0				272.1				316.9				345.6				349.1				285.2				280.1				297.0				293.5				294.8				336.2				361.0
Gross margin			147.3				181.2				202.9				212.1				204.0				242.6				266.4				264.2				218.2				213.4				228.6				222.9				222.2				254.2				272.1
Gross margin, %			75.7	%			76.7	%			75.5	%			75.8	%			75.0	%			76.6	%			77.1	%			75.7	%			76.5	%			76.2	%			77.0	%			75.9	%			75.4	%			75.6	%			75.4	%
Adjusted OIBDA			96.4				120.0				137.6				141.4				134.0				148.4				176.9				169.9				140.4				138.7				154.7				144.5				139.6				161.9				176.0
Adjusted OIBDA, %			49.5	%			50.8	%			51.2	%			50.5	%			49.2	%			46.8	%			51.2	%			48.7	%			49.2	%			49.5	%			52.1	%			49.2	%			47.4	%			48.2	%			48.8	%
SG&A			49.1				59.8				62.8				66.4				68.0				92.0				88.1				93.1				76.0				72.5				73.3				78.0				79.1				90.1				94.6
including Sales & Marketing Expenses			16.4				20.5				22.0				27. 8				22.2				26.0				30.4				34.8				19.2				15.8				20.5				21.4				18.2				21.4				26.2
including advertising			5.3				7.0				7.8				9.5				8.7				10.3				10.0				13.4				4.9				3.6				4.6				6.7				5.0				6.6				9.1
including General & Administrative Costs			32.7				39.3				40.8				38.6				45.8				66.0				57.7				58.3				56.8				56.7				52.8				56.6				60.9				68.7				68.4
SG&A, %			25.2	%			25.3	%			23.4	%			23.7	%			25.0	%			29.0	%			25.5	%			26.7	%			26.6	%			25.9	%			24.7	%			26.6	%			26.8	%			26.8	%			26.2	%
Net Income attributable to VimpelCom Ltd			15.3				20.8				41.9				22.2				8.3				21.5				50.6				46.8				0.4				32.9				37.9				16.7				27.1				28.4				34.7
Capital Expenditures			74.6				99.8				95.9				273.4				119.4				184.9				139.9				145.6				6.6				21.7				21.5				57.1				32.3				70.7				78.3
MOBILE		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			160.4				201.1				231.1				243.7				234.4				273.3				302.9				306.4				248.6				245.3				260.0				259.0				260.8				297.4				320.5
including Mobile Interconnect			23.0				30.1				34.3				39.6				35.5				39.9				46.2				48.8				37.5				38.8				43.6				44.1				46.3				52.2				55.4
Adjusted OIBDA			80.2				101.5				118.1				118.6				114.9				127.7				156.3				149.4				123.0				123.0				137.4				128.8				125.4				147.6				159.5
Adjusted OIBDA, %			50.0	%			50.5	%			51.1	%			48.7	%			49.0	%			46.7	%			51.6	%			48.8	%			49.5	%			50.1	%			52.8	%			49.7	%			48.1	%			49.6	%			49.8	%
Subscriptions (‘000)			5,200				5,740				6,672				7,578				8,244				9,111				10,261				11,300				11,480				11,692				12,036				11,337				13,125				13,875				14,782
FIXED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			34.2				35.2				37.6				36.3				37.8				43.5				42.8				42.7				36.7				34.8				37.0				34.5				34.0				38.8				40.5
including business segment			0				0				0				0				1.0				3.3				3.2				3.2				3.0				3.1				3.0				8.7				7.5				7.9				8.2
including wholesale segment			0				0				0				0				0.5				1.7				1.9				2.2				1.5				1.5				2.1				6.9				13.4				17.2				17.6
including residential segment			34.2				35.2				37.6				36.3				36.3				38.5				37.7				37.3				32.2				30.2				31.9				18.9				13.1				13.7				14.7
Adjusted OIBDA			16.2				18.5				19.5				22.8				19.1				20.7				20.6				20.5				17.4				15.7				17.3				15.7				14.2				14.3				16.5
Adjusted OIBDA, %			47.4	%			52.6	%			51.9	%			62.8	%			50.5	%			47.6	%			48.1	%			48.0	%			47.4	%			45.1	%			46.8	%			45.5	%			41.8	%			36.9	%			40.7	%
Broadband subscriptions (‘000)			0				0				0				0				0				0				5.4				15.2				22.3				27.1				26.7				36.5				58.4				81.8				94.7
BB subscritions using USB modems (‘000)							0				0				0				0				0				0				0				0				0				0				0				14.5				17.1				20.3
BB fixed-line subscriptions (‘000)							0				0				0				0				0				5.4				15.2				22.3				27.1				26.7				36.5				43.9				64.7				74.4
Reconciliation of OIBDA Total		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			96.4				120.0				137.6				141.4				134.0				148.4				176.9				169.9				140.4				138.7				154.7				144.5				139.6				161.9				176.0
Depreciation			(33.3	)			(40.6	)			(31.4	)			(49.7	)			(58.5	)			(60.3	)			(49.7	)			(70.3	)			(55.7	)			(49.7	)			(59.4	)			(72.8	)			(60.0	)			(58.1	)			(66.8	)
Amortization			(19.5	)			(20.1	)			(20.9	)			(22.3	)			(25.1	)			(26.9	)			(31.9	)			(32.5	)			(26.6	)			(24.1	)			(24.0	)			(23.6	)			(20.6	)			(21.6	)			(28.5	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			43.6				59.3				85.3				69.4				50.4				61.2				95.3				67.1				58.1				64.9				71.3				48.1				59.0				82.2				80.7
Interest income			0.1				0.2				0.8				—				0.4				0.7				0.7				1.1				1.2				1.7				2.2				2.6				3.1				3.3				3.5
Net foreign exchange gain/(loss)			9.9				4.5				0.2				4.7				1.6				4.2				6.0				(27.9	)			(49.7	)			(3.0	)			(2.5	)			(1.6	)			(5.1	)			(17.4	)			(0.7	)
Interest expense			(6.1	)			(6.2	)			(8.0	)			(10.0	)			(8.6	)			(7.6	)			(8.0	)			(10.1	)			(9.4	)			(8.5	)			(9.0	)			(11.1	)			(8.1	)			(8.0	)			(7.2	)
Equity in net gain/(loss) of associates			—				—				—				(0.2	)			—				—				—				0.1				—				(0.5	)			—				0.9				(0.1	)			(0.1	)			0.1
Other (expense)/income, net			(5.2	)			(2.4	)			2.1				4.1				(7.0	)			(2.3	)			(3.3	)			(5.1	)			(5.6	)			0.5				(3.4	)			(2.0	)			(0.9	)			(2.3	)			(18.1	)
Income tax expense			(15.7	)			(19.5	)			(19.0	)			(28.0	)			(14.2	)			(17.7	)			(29.2	)			46.7				(1.6	)			(14.7	)			(15.5	)			(16.8	)			(8.4	)			(13.6	)			(13.2	)
Net income/(loss)			26.6				35.9				61.4				40.0				22.6				38.5				61.5				71.9				-7.0				40.4				43.1				20.1				39.5				44.1				45.1
Adjusted OIBDA margin as a percentage of net operating revenue			49.5	%			50.8	%			51.2	%			50.5	%			49.2	%			46.8	%			51.2	%			48.7	%			49.2	%			49.5	%			52.1	%			49.2	%			47.4	%			48.2	%			48.8	%
Depreciation			(17.1	%)			(17.2	%)			(11.6	%)			(17.7	%)			(21.5	%)			(19.0	%)			(14.4	%)			(20.2	%)			(19.5	%)			(17.7	%)			(20.0	%)			(24.8	%)			(20.5	%)			(17.4	%)			(18.5	%)
Amortization			(10.0	%)			(8.5	%)			(7.8	%)			(8.0	%)			(9.2	%)			(8.5	%)			(9.2	%)			(9.3	%)			(9.3	%)			(8.6	%)			(8.1	%)			(8.0	%)			(7.0	%)			(6.4	%)			(7.9	%)
Impairment loss			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income			22.4	%			25.1	%			31.8	%			24.8	%			18.5	%			19.3	%			27.6	%			19.2	%			20.4	%			23.2	%			24.0	%			16.4	%			19.9	%			24.4	%			22.4	%
Interest income			0.1	%			0.1	%			0.3	%			0.0	%			0.1	%			0.2	%			0.2	%			0.3	%			0.4	%			0.6	%			0.7	%			0.9	%			1.1	%			1.0	%			1.0	%
Net foreign exchange gain/(loss)			5.1	%			1.9	%			0.1	%			1.7	%			0.6	%			1.3	%			1.7	%			-8.0	%			-17.4	%			-1.1	%			-0.8	%			-0.5	%			-1.7	%			-5.2	%			-0.2	%
Interest expense			-3.1	%			-2.6	%			-3.0	%			-3.6	%			-3.2	%			-2.4	%			-2.3	%			-2.9	%			-3.3	%			-3.0	%			-3.0	%			-3.8	%			-2.7	%			-2.4	%			-2.0	%
Equity in net gain/(loss) of associates			0.0	%			0.0	%			0.0	%			-0.1	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			-0.2	%			0.0	%			0.3	%			0.0	%			0.0	%			0.0	%
Other (expense)/income, net			-2.7	%			-1.0	%			0.7	%			1.5	%			-2.6	%			-0.7	%			-1.1	%			-1.6	%			-2.1	%			0.2	%			-1.1	%			-0.8	%			-0.4	%			-0.7	%			-5.0	%
Income tax expense			-8.1	%			-8.3	%			-7.1	%			-10.0	%			-5.2	%			-5.6	%			-8.4	%			13.4	%			-0.6	%			-5.2	%			-5.2	%			-5.7	%			-2.8	%			-4.0	%			-3.7	%
Net income/(loss)			13.7	%			15.2	%			22.9	%			14.3	%			8.3	%			12.1	%			17.8	%			20.6	%			-2.5	%			14.4	%			14.5	%			6.8	%			13.4	%			13.1	%			12.5	%
Reconciliation of Adjusted OIBDA Mobile		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			80.2				101.5				118.0				118.6				114.9				127.7				156.3				149.4				123.0				123.0				137.4				128.8				125.4				147.6				159.5
Depreciation			(23.6	)			(33.3	)			(24.4	)			(33.6	)			(50.2	)			(50.8	)			(40.8	)			(60.3	)			(45.7	)			(41.5	)			(46.2	)			(58.6	)			(50.5	)			(47.5	)			(51.6	)
Amortization			(14.7	)			(15.3	)			(15.8	)			(15.8	)			(16.1	)			(18.6	)			(22.2	)			(23.1	)			(20.4	)			(18.6	)			(18.5	)			(18.0	)			(19.7	)			(19.4	)			(26.9	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			41.9				52.9				77.8				69.2				48.6				58.3				93.3				66.0				56.9				62.9				72.7				52.2				55.2				80.7				81.0
Interest income			0.2				0.2				0.9				0.2				0.3				0.5				1.1				1.5				0.7				1.9				2.6				3.0				3.4				3.5				3.8
Net foreign exchange gain/(loss)			10.2				3.6				1.0				3.8				3.4				3.8				4.4				(27.6	)			(51.9	)			(1.3	)			(3.3	)			(1.1	)			(7.6	)			(14.0	)			0.2
Interest expense			(5.7	)			(6.2	)			(7.8	)			(9.2	)			(8.2	)			(7.0	)			(7.6	)			(9.6	)			(9.2	)			(8.4	)			(8.7	)			(10.8	)			(7.9	)			(7.9	)			(7.1	)
Equity in net gain/(loss) of associates			—				—				—				(0.2	)			—				—				—				—				—				—				—				—				—				—				—
Other (expense)/income, net			(4.7	)			(1.8	)			1.8				4.5				(7.1	)			(1.1	)			(2.6	)			(2.6	)			(4.6	)			(1.1	)			(2.3	)			(1.0	)			(0.7	)			(1.7	)			(17.1	)
Income tax expense			(13.9	)			(18.4	)			(20.3	)			(26.9	)			(14.0	)			(18.9	)			(24.2	)			46.9				(0.6	)			(12.3	)			(14.2	)			(15.7	)			(6.7	)			(13.1	)			(12.9	)
Net income/(loss)			28.0				30.3				53.4				41.4				23.0				35.6				64.4				74.6				(8.7	)			41.7				46.8				26.6				35.7				47.5				47.9
Adjusted OIBDA margin mobile as a percentage of net operating revenue			50.0	%			50.5	%			51.1	%			48.7	%			49.0	%			46.7	%			51.6	%			48.8	%			49.5	%			50.1	%			52.8	%			49.7	%			48.1	%			49.6	%			49.8	%
Depreciation			(14.7	%)			(16.6	%)			(10.6	%)			(13.8	%)			(21.4	%)			(18.6	%)			(13.5	%)			(19.7	%)			(18.4	%)			(16.9	%)			(17.8	%)			(22.6	%)			(19.4	%)			(16.0	%)			(16.1	%)
Amortization			(9.2	%)			(7.6	%)			(6.8	%)			(6.5	%)			(6.9	%)			(6.8	%)			(7.3	%)			(7.5	%)			(8.2	%)			(7.6	%)			(7.1	%)			(6.9	%)			(7.6	%)			(6.5	%)			(8.4	%)
Impairment loss			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income margin			26.1	%			26.3	%			33.7	%			28.4	%			20.7	%			21.3	%			30.8	%			21.5	%			22.9	%			25.6	%			28.0	%			20.2	%			21.2	%			27.1	%			25.3	%
Interest income			0.1	%			0.1	%			0.4	%			0.1	%			0.1	%			0.2	%			0.4	%			0.5	%			0.3	%			0.8	%			1.0	%			1.2	%			1.3	%			1.2	%			1.2	%
Net foreign exchange gain/(loss)			6.4	%			1.8	%			0.4	%			1.6	%			1.5	%			1.4	%			1.5	%			(9.0	%)			(20.9	%)			(0.5	%)			(1.3	%)			(0.4	%)			(2.9	%)			(4.7	%)			0.1	%
Interest expense			(3.6	%)			(3.1	%)			(3.4	%)			(3.8	%)			(3.5	%)			(2.6	%)			(2.5	%)			(3.1	%)			(3.7	%)			(3.4	%)			(3.3	%)			(4.2	%)			(3.0	%)			(2.7	%)			(2.2	%)
Equity in net gain/(loss) of associates			0.0	%			0.0	%			0.0	%			(0.1	%)			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Other (expense)/income, net			(2.9	%)			(0.9	%)			0.8	%			1.8	%			(3.0	%)			(0.4	%)			(0.9	%)			(0.8	%)			(1.9	%)			(0.4	%)			(0.9	%)			(0.4	%)			(0.3	%)			(0.6	%)			(5.3	%)
Income tax expense			(8.7	%)			(9.1	%)			(8.8	%)			(11.0	%)			(6.0	%)			(6.9	%)			(8.0	%)			15.3	%			(0.2	%)			(5.0	%)			(5.5	%)			(6.1	%)			(2.6	%)			(4.4	%)			(4.0	%)
Net income/(loss) margin			17.5	%			15.1	%			23.1	%			17.0	%			9.8	%			13.0	%			21.3	%			24.3	%			(3.5	%)			17.0	%			18.0	%			10.3	%			13.7	%			16.0	%			14.9	%
Reconciliation of Adjusted OIBDA Fixed		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			16.2				18.5				19.6				22.8				19.1				20.7				20.6				20.5				17.4				15.7				17.3				15.7				14.2				14.3				16.6
Depreciation			(9.7	)			(7.3	)			(7.0	)			(16.1	)			(8.2	)			(9.5	)			(8.6	)			(10.0	)			(10.1	)			(8.2	)			(13.2	)			(14.1	)			(9.4	)			(10.7	)			(15.3	)
Amortization			(4.8	)			(4.8	)			(5.1	)			(6.5	)			(9.0	)			(8.3	)			(9.6	)			(9.4	)			(6.2	)			(5.6	)			(5.5	)			(5.6	)			(1.0	)			(2.1	)			(1.6	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			1.7				6.4				7.5				0.2				1.9				2.9				2.4				1.1				1.1				1.9				(1.4	)			(4.0	)			3.8				1.5				(0.3	)
Interest income			(0.1	)			—				(0.1	)			(0.2	)			0.2				0.2				0.3				0.3				0.5				1.2				0.7				0.7				0.8				0.9				0.9
Net foreign exchange gain/(loss)			(0.3	)			0.9				(0.8	)			0.9				(1.8	)			0.4				1.6				(0.3	)			2.2				(1.6	)			0.8				(0.5	)			2.5				(3.4	)			(0.8	)
Interest expense			(0.4	)			—				(0.2	)			(0.8	)			(0.5	)			(0.9	)			(1.1	)			(1.2	)			(1.1	)			(1.6	)			(1.3	)			(1.3	)			(1.3	)			(1.2	)			(1.3	)
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				0.1				—				(0.5	)			—				0.9				(0.2	)			(0.1	)			0.1
Other (expense)/income, net			(0.5	)			(0.6	)			0.3				(0.4	)			1.1				(0.8	)			(0.7	)			(2.4	)			—				1.6				(1.2	)			(1.2	)			(0.2	)			(0.7	)			(1.2	)
Income tax expense			(1.8	)			(1.1	)			1.3				(1.1	)			(0.3	)			1.1				(5.0	)			(0.2	)			(1.0	)			(2.4	)			(1.3	)			(1.1	)			(1.7	)			(0.4	)			(0.2	)
Net income/(loss)			(1.4	)			5.6				8.0				(1.4	)			0.6				2.9				(2.5	)			(2.6	)			1.7				(1.4	)			(3.7	)			(6.5	)			3.7				(3.4	)			(2.8	)
Adjusted OIBDA margin fixed as a percentage of net operating revenue			47.4	%			52.6	%			52.1	%			62.8	%			50.5	%			47.6	%			48.1	%			48.0	%			47.4	%			45.1	%			46.8	%			45.5	%			41.8	%			36.9	%			41.0	%
Depreciation			(28.4	%)			(20.7	%)			(18.6	%)			(44.4	%)			(21.7	%)			(21.8	%)			(20.1	%)			(23.4	%)			(27.5	%)			(23.6	%)			(35.7	%)			(40.9	%)			(27.6	%)			(27.6	%)			(37.8	%)
Amortization			(14.0	%)			(13.6	%)			(13.6	%)			(17.9	%)			(23.8	%)			(19.1	%)			(22.4	%)			(22.0	%)			(16.9	%)			(16.1	%)			(14.9	%)			(16.2	%)			(2.9	%)			(5.4	%)			(4.0	%)
Impairment loss			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income margin			5.0	%			18.2	%			19.9	%			0.6	%			5.0	%			6.7	%			5.6	%			2.6	%			3.0	%			5.5	%			(3.8	%)			(11.6	%)			11.2	%			3.9	%			(0.7	%)
Interest income			(0.3	%)			0.0	%			(0.3	%)			(0.6	%)			0.5	%			0.5	%			0.7	%			0.7	%			1.4	%			3.4	%			1.9	%			2.0	%			2.4	%			2.3	%			2.2	%
Net foreign exchange gain/(loss)			(0.9	%)			2.6	%			(2.1	%)			2.5	%			(4.8	%)			0.9	%			3.7	%			(0.7	%)			6.0	%			(4.6	%)			2.2	%			(1.4	%)			7.4	%			(8.8	%)			(2.0	%)
Interest expense			(1.2	%)			0.0	%			(0.5	%)			(2.2	%)			(1.3	%)			(2.1	%)			(2.6	%)			(2.8	%)			(3.0	%)			(4.6	%)			(3.5	%)			(3.8	%)			(3.8	%)			(3.1	%)			(3.2	%)
Equity in net gain/(loss) of associates			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.2	%			0.0	%			(1.4	%)			0.0	%			2.6	%			(0.6	%)			(0.3	%)			0.2	%
Other (expense)/income, net			(1.5	%)			(1.7	%)			0.8	%			(1.1	%)			2.9	%			(1.8	%)			(1.6	%)			(5.6	%)			0.0	%			4.6	%			(3.2	%)			(3.5	%)			(0.6	%)			(1.8	%)			(3.0	%)
Income tax expense			(5.3	%)			(3.1	%)			3.5	%			(3.0	%)			(0.8	%)			2.5	%			(11.7	%)			(0.5	%)			(2.7	%)			(6.9	%)			(3.5	%)			(3.2	%)			(5.0	%)			(1.0	%)			(0.5	%)
Net income/(loss) margin			(4.1	%)			15.9	%			21.3	%			(3.9	%)			1.6	%			6.7	%			(5.8	%)			(6.1	%)			4.6	%			(4.0	%)			(10.0	%)			(18.8	%)			10.9	%			(8.8	%)			(6.9	%)

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Table of Contents

Kazakhstan

(in US$ millions, unless stated otherwise, unaudited)

 

CONSOLIDATED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			119.4				149.3				167.1				174.6				162.8				185.3				198.6				196.9				153.9				157.1				171.9				170.4				159.5				184.3				197.4
Gross margin			88.2				112.0				122.1				128.4				118.9				140.8				152.6				148.8				116.7				120.3				136.0				133.0				123.2				145.2				156.1
Gross margin, %			73.9	%			75.0	%			73.1	%			73.5	%			73.0	%			76.0	%			76.8	%			75.6	%			75.8	%			76.6	%			79.1	%			78.1	%			77.2	%			78.8	%			79.1	%
Adjusted OIBDA			62.0				80.3				88.1				92.2				82.0				96.4				106.1				97.7				78.7				85.2				101.7				93.9				88.5				105.7				111.8
Adjusted OIBDA, %			51.9	%			53.8	%			52.7	%			52.8	%			50.4	%			52.0	%			53.4	%			49.6	%			51.1	%			54.2	%			59.2	%			55.1	%			55.5	%			57.4	%			56.6	%
SG&A			25.4				31.7				32.7				33.8				34.8				43.5				45.9				50.4				37.4				34.5				34.4				39.3				35.0				39.1				44.1
including Sales & Marketing Expenses			11.0				14.2				13.8				17.1				12.9				15.1				17.6				22.7				11.9				8.8				10.4				12.7				9.4				12.9				16.5
including advertising			3.7				4.5				5.0				5.5				4.7				5.8				5.5				8.8				3.0				1.2				1.9				3.8				2.4				3.8				5.8
including General & Administrative Costs			14.4				17.5				18.9				16.7				21.9				28.4				28.3				27.7				25.5				25.7				24.0				26.6				25.6				26.2				27.6
SG&A, %			21.3	%			21.2	%			19.6	%			19.4	%			21.4	%			23.5	%			23.1	%			25.6	%			24.3	%			22.0	%			20.0	%			23.1	%			21.9	%			21.2	%			22.3	%
Net Income attributable to VimpelCom Ltd			13.1				16.4				21.7				19.8				14.1				19.5				29.9				76.4				-12.5				30.0				40.8				25.8				36.0				43.9				38.2
Capital Expenditures			31.2				45.8				40.5				96.4				42.6				55.5				77.1				79.7				3.3				11.0				10.0				19.5				5.9				25.8				38.5
MOBILE		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			119.4				149.3				167.1				174.6				162.0				182.5				195.9				193.7				151.6				154.8				169.3				167.7				156.3				180.5				192.8
including Mobile Interconnect			20.5				26.5				28.5				33.0				28.4				30.9				32.2				31.4				23.4				23.4				25.4				25.0				23.4				25.4				25.7
Adjusted OIBDA			62.0				80.3				88.1				92.2				82.0				96.3				106.2				97.7				78.7				85.6				101.7				93.9				88.1				104.9				110.2
Adjusted OIBDA, %			51.9	%			53.8	%			52.7	%			52.8	%			50.6	%			52.8	%			54.2	%			50.4	%			51.9	%			55.3	%			60.1	%			56.0	%			56.4	%			58.1	%			57.2	%
Subscriptions (‘000)			3,501				3,858				4,343				4,604				4,777				5,098				5,614				6,270				6,377				6,635				6,835				6,135				6,062				6,339				6,736
ARPU, US$			12.2				13.6				13.6				13.0				11.6				12.3				12.1				10.8				7.8				7.9				8.2				8.5				8.4				9.6				9.6
MOU, min			72.3				88.8				112.7				98.9				99.1				109.7				108.1				100.5				81.1				90.7				98.1				102.3				102.2				125.1				130.3
Churn 3 months active base (quarterly), %			n/a				n/a				n/a				9.8	%			9.5	%			7.6	%			7.4	%			7.3	%			9.2	%			5.7	%			9.3	%			22.2	%			11.4	%			8.9	%			8.8	%
FIXED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			—				—				—				—				0.8				2.8				2.7				3.2				2.3				2.3				2.6				2.7				3.2				3.8				4.6
including business segment			—				—				—				—				0.3				1.0				0.8				1.0				0.7				0.8				0.5				0.5				0.6				0.6				0.7
including wholesale segment			—				—				—				—				0.5				1.8				1.9				2.2				1.5				1.4				2.0				2.1				2.4				3.0				3.6
including residential segment			—				—				—				—				0.001				0.003				0.003				0.05				0.1				0.1				0.1				0.1				0.2				0.2				0.3
Adjusted OIBDA			—				—				—				—				0.0				0.1				-0.1				0.0				0.0				-0.4				0.0				0.0				0.4				0.8				1.6
Adjusted OIBDA, %			—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				12.5	%			21.1	%			34.8	%
Broadband subscriptions (‘000)			—				—				—				—				—				—				—				0.2				0.2				0.3				0.3				1.3				2.7				4.3				6.2
BB subscritions using USB modems (‘000)			—				—				—				—				—				—				—				0				0				0				0				0				0				0				0
BB fixed-line subscriptions (‘000)			—				—				—				—				—				—				—				0.2				0.2				0.3				0.3				1.3				2.7				4.3				6.2
Reconciliation of OIBDA Total		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			62.0				80.3				88.1				92.2				82.0				96.4				106.1				97.7				78.7				85.2				101.7				93.9				88.5				105.7				111.8
Depreciation			(15.9	)			(17.5	)			(14.9	)			(20.2	)			(21.6	)			(25.7	)			(24.0	)			(28.7	)			(23.9	)			(21.6	)			(24.9	)			(27.4	)			(18.5	)			(21.9	)			(21.6	)
Amortization			(9.2	)			(9.5	)			(9.1	)			(9.7	)			(9.7	)			(11.1	)			(15.9	)			(16.0	)			(14.1	)			(12.8	)			(12.7	)			(13.0	)			(13.3	)			(13.2	)			(13.1	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			36.9				53.3				64.1				62.3				50.7				59.6				66.2				53.0				40.7				50.8				64.1				53.5				56.7				70.6				77.1
Interest income			—				—				0.6				(0.4	)			0.2				0.3				0.2				0.3				0.3				0.4				1.1				0.6				0.3				0.7				0.8
Net foreign exchange gain/(loss)			10.5				2.4				1.6				1.0				(1.9	)			(0.1	)			2.5				(1.9	)			(51.7	)			1.9				(0.8	)			0.3				0.4				(0.1	)			(0.2	)
Interest expense			(4.3	)			(4.1	)			(4.9	)			(5.1	)			(3.4	)			(3.2	)			(3.0	)			(3.1	)			(1.5	)			(1.6	)			(0.9	)			(2.9	)			(0.1	)			(0.3	)			0.2
Equity in net gain/(loss) of associates			—				—				—				(0.2	)			—				—				—				0.1				—				(0.5	)			—				0.9				(0.2	)			(0.1	)			0.1
Other (expense)/income, net			(4.1	)			(1.4	)			2.0				5.3				(4.0	)			(0.5	)			(4.4	)			0.3				(5.2	)			(0.3	)			(0.8	)			(1.5	)			(0.4	)			(0.6	)			(12.5	)
Income tax expense			(12.8	)			(17.3	)			(19.9	)			(23.8	)			(13.5	)			(18.7	)			(20.6	)			52.8				0.6				(10.8	)			(13.1	)			(18.6	)			(8.7	)			(11.6	)			(14.6	)
Net income/(loss)			26.2				32.9				43.5				39.1				28.1				37.4				40.9				101.5				(16.8	)			39.9				49.6				32.3				48.0				58.6				50.9
Adjusted OIBDA margin as a percentage of net operating revenue			51.9	%			53.8	%			52.7	%			52.8	%			50.4	%			52.0	%			53.4	%			49.6	%			51.1	%			54.2	%			59.2	%			55.1	%			55.5	%			57.4	%			56.6	%
Depreciation			(13.3	%)			(11.7	%)			(8.9	%)			(11.5	%)			(13.3	%)			(13.8	%)			(12.1	%)			(14.6	%)			(15.5	%)			(13.8	%)			(14.5	%)			(16.1	%)			(11.7	%)			(11.9	%)			(10.9	%)
Amortization			(7.7	%)			(6.4	%)			(5.4	%)			(5.6	%)			(6.0	%)			(6.0	%)			(8.0	%)			(8.1	%)			(9.2	%)			(8.1	%)			(7.4	%)			(7.6	%)			(8.3	%)			(7.2	%)			(6.6	%)
Impairment loss			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income			30.9	%			35.7	%			38.4	%			35.7	%			31.1	%			32.2	%			33.3	%			26.9	%			26.4	%			32.3	%			37.3	%			31.4	%			35.5	%			38.3	%			39.1	%
Interest income			0.0	%			0.0	%			0.4	%			(0.2	%)			0.1	%			0.2	%			0.1	%			0.2	%			0.2	%			0.3	%			0.6	%			0.4	%			0.2	%			0.4	%			0.4	%
Net foreign exchange gain/(loss)			8.8	%			1.6	%			1.0	%			0.6	%			(1.2	%)			(0.1	%)			1.3	%			(1.0	%)			(33.6	%)			1.2	%			(0.5	%)			0.2	%			0.3	%			(0.1	%)			(0.1	%)
Interest expense			(3.6	%)			(2.7	%)			(2.9	%)			(2.9	%)			(2.1	%)			(1.7	%)			(1.5	%)			(1.6	%)			(1.0	%)			(1.0	%)			(0.5	%)			(1.7	%)			(0.1	%)			(0.2	%)			0.1	%
Equity in net gain/(loss) of associates			0.0	%			0.0	%			0.0	%			(0.1	%)			0.0	%			0.0	%			0.0	%			0.1	%			0.0	%			(0.3	%)			0.0	%			0.5	%			(0.1	%)			(0.1	%)			0.1	%
Other (expense)/income, net			(3.5	%)			(1.0	%)			1.0	%			2.9	%			(2.3	%)			(0.3	%)			(2.2	%)			0.1	%			(3.3	%)			(0.2	%)			(0.4	%)			(0.9	%)			(0.2	%)			(0.3	%)			(6.3	%)
Income tax expense			(10.7	%)			(11.6	%)			(11.9	%)			(13.6	%)			(8.3	%)			(10.1	%)			(10.4	%)			26.8	%			0.4	%			(6.9	%)			(7.6	%)			(10.9	%)			(5.5	%)			(6.3	%)			(7.4	%)
Net income/(loss)			21.9	%			22.0	%			26.0	%			22.4	%			17.3	%			20.2	%			20.6	%			51.5	%			(10.9	%)			25.4	%			28.9	%			19.0	%			30.1	%			31.8	%			25.8	%
Reconciliation of Adjusted OIBDA Mobile		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			62.0				80.3				88.1				92.2				82.0				96.3				106.1				97.7				78.7				85.6				101.7				93.9				88.1				104.9				110.2
Depreciation			(15.9	)			(17.5	)			(14.9	)			(20.2	)			(21.5	)			(25.1	)			(23.1	)			(27.5	)			(22.9	)			(20.5	)			(23.1	)			(25.7	)			(16.6	)			(19.6	)			(19.6	)
Amortization			(9.2	)			(9.5	)			(9.1	)			(9.7	)			(9.7	)			(11.0	)			(15.2	)			(15.5	)			(13.5	)			(12.3	)			(12.2	)			(12.3	)			(12.8	)			(12.6	)			(12.5	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			36.9				53.3				64.1				62.3				50.8				60.2				67.8				54.7				42.3				52.8				66.4				55.9				58.7				72.7				78.1
Interest income			—				—				0.6				(0.4	)			0.2				0.3				0.8				1.1				0.3				1.4				2.1				1.7				1.3				1.8				2.0
Net foreign exchange gain/(loss)			10.5				2.4				1.6				1.0				(1.9	)			(0.1	)			2.5				(1.8	)			(51.0	)			1.9				(0.8	)			0.3				0.4				(0.1	)			(0.2	)
Interest expense			(4.3	)			(4.1	)			(4.9	)			(5.1	)			(3.4	)			(3.2	)			(2.9	)			(3.0	)			(1.5	)			(1.6	)			(0.8	)			(2.8	)			—				(0.2	)			0.2
Equity in net gain/(loss) of associates			—				—				—				(0.2	)			—				—				—				—				—				—				—				—				—				—				—
Other (expense)/income, net			(4.1	)			(1.4	)			2.0				5.3				(4.1	)			(0.2	)			(0.6	)			0.2				(4.3	)			(1.3	)			(0.8	)			(0.5	)			(0.3	)			(0.7	)			(12.5	)
Income tax expense			(12.8	)			(17.3	)			(19.9	)			(23.8	)			(13.4	)			(18.6	)			(20.5	)			50.7				0.6				(11.0	)			(13.3	)			(18.3	)			(8.4	)			(12.0	)			(14.8	)
Net income/(loss)			26.2				32.9				43.5				39.1				28.2				38.4				47.1				101.9				(13.6	)			42.2				52.8				36.3				51.7				61.5				52.8
Adjusted OIBDA margin mobile as a percentage of net operating revenue			51.9	%			53.8	%			52.7	%			52.8	%			50.6	%			52.8	%			54.2	%			50.4	%			51.9	%			55.3	%			60.1	%			56.0	%			56.4	%			58.1	%			57.2	%
Depreciation			(13.3	%)			(11.7	%)			(8.9	%)			(11.5	%)			(13.3	%)			(13.8	%)			(11.8	%)			(14.2	%)			(15.1	%)			(13.2	%)			(13.6	%)			(15.3	%)			(10.6	%)			(10.9	%)			(10.2	%)
Amortization			(7.7	%)			(6.4	%)			(5.4	%)			(5.6	%)			(6.0	%)			(6.0	%)			(7.8	%)			(8.0	%)			(8.9	%)			(7.9	%)			(7.2	%)			(7.3	%)			(8.2	%)			(7.0	%)			(6.5	%)
Impairment loss			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income margin			30.9	%			35.7	%			38.4	%			35.7	%			31.4	%			33.0	%			34.6	%			28.2	%			27.9	%			34.1	%			39.2	%			33.3	%			37.6	%			40.3	%			40.5	%
Interest income			0.0	%			0.0	%			0.4	%			(0.2	%)			0.1	%			0.2	%			0.4	%			0.6	%			0.2	%			0.9	%			1.2	%			1.0	%			0.8	%			1.0	%			1.0	%
Net foreign exchange gain/(loss)			8.8	%			1.6	%			1.0	%			0.6	%			(1.2	%)			(0.1	%)			1.3	%			(0.9	%)			(33.6	%)			1.2	%			(0.5	%)			0.2	%			0.3	%			(0.1	%)			(0.1	%)
Interest expense			(3.6	%)			(2.7	%)			(2.9	%)			(2.9	%)			(2.1	%)			(1.8	%)			(1.5	%)			(1.5	%)			(1.0	%)			(1.0	%)			(0.5	%)			(1.7	%)			0.0	%			(0.1	%)			0.1	%
Equity in net gain/(loss) of associates			0.0	%			0.0	%			0.0	%			(0.1	%)			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Other (expense)/income, net			(3.5	%)			(1.0	%)			1.0	%			2.9	%			(2.5	%)			(0.1	%)			(0.3	%)			0.1	%			(2.8	%)			(0.8	%)			(0.5	%)			(0.3	%)			(0.2	%)			(0.4	%)			(6.5	%)
Income tax expense			(10.7	%)			(11.6	%)			(11.9	%)			(13.6	%)			(8.3	%)			(10.2	%)			(10.5	%)			26.2	%			0.4	%			(7.1	%)			(7.9	%)			(10.9	%)			(5.4	%)			(6.6	%)			(7.7	%)
Net income/(loss) margin			21.9	%			22.0	%			26.0	%			22.4	%			17.4	%			21.0	%			24.0	%			52.6	%			(9.0	%)			27.3	%			31.2	%			21.6	%			33.1	%			34.1	%			27.4	%
Reconciliation of Adjusted OIBDA Fixed		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			—				—				—				—				0.0				0.1				(0.1	)			—				—				(0.4	)			0.0				—				0.4				0.8				1.6
Depreciation			—				—				—				—				(0.08	)			(0.7	)			(1.0	)			(1.2	)			(1.0	)			(1.1	)			(1.8	)			(1.7	)			(2.0	)			(2.3	)			(2.1	)
Amortization			—				—				—				—				—				—				(0.6	)			(0.5	)			(0.6	)			(0.5	)			(0.5	)			(0.7	)			(0.5	)			(0.5	)			(0.5	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			—				—				—				—				(0.0	)			(0.6	)			(1.7	)			(1.7	)			(1.6	)			(2.0	)			(2.3	)			(2.4	)			(2.1	)			(2.0	)			(1.0	)
Interest income			—				—				—				—				—				—				—				—				(0.1	)			—				—				—				—				—				—
Net foreign exchange gain/(loss)			—				—				—				—				—				—				—				(0.1	)			(0.7	)			—				—				—				—				—				—
Interest expense			—				—				—				—				—				(0.5	)			(0.7	)			(1.0	)			(0.9	)			(1.5	)			(1.1	)			(1.1	)			(1.2	)			(1.2	)			(1.3	)
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				0.1				—				(0.5	)			—				0.9				(0.2	)			(0.1	)			0.1
Other (expense)/income, net			—				—				—				—				—				(0.2	)			(3.7	)			0.2				0.1				1.1				—				(1.1	)			0.1				—				—
Income tax expense			—				—				—				—				(0.1	)			(0.2	)			(0.1	)			2.1				—				0.2				0.2				(0.4	)			(0.3	)			0.4				0.2
Net income/(loss)			—				—				—				—				(0.1	)			(1.5	)			(6.2	)			(0.4	)			(3.2	)			(2.7	)			(3.2	)			(4.1	)			(3.7	)			(2.9	)			(2.0	)
Adjusted OIBDA margin fixed as a percentage of net operating revenue			0.0	%			0.0	%			0.0	%			0.0	%			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				12.5	%			21.1	%			34.8	%
Depreciation			0.0	%			0.0	%			0.0	%			0.0	%			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(62.5	%)			(60.5	%)			(45.7	%)
Amortization			0.0	%			0.0	%			0.0	%			0.0	%			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(15.6	%)			(13.2	%)			(10.9	%)
Impairment loss			0.0	%			0.0	%			0.0	%			0.0	%			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				0.0	%			0.0	%			0.0	%
Operating income margin			0.0	%			0.0	%			0.0	%			0.0	%			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(65.6	%)			(52.6	%)			(21.7	%)
Interest income			0.0	%			0.0	%			0.0	%			0.0	%			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				0.0	%			0.0	%			0.0	%
Net foreign exchange gain/(loss)			0.0	%			0.0	%			0.0	%			0.0	%			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				0.0	%			0.0	%			0.0	%
Interest expense			0.0	%			0.0	%			0.0	%			0.0	%			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(37.5	%)			(31.6	%)			(28.3	%)
Equity in net gain/(loss) of associates			0.0	%			0.0	%			0.0	%			0.0	%			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(6.3	%)			(2.6	%)			2.2	%
Other (expense)/income, net			0.0	%			0.0	%			0.0	%			0.0	%			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				3.1	%			0.0	%			0.0	%
Income tax expense			0.0	%			0.0	%			0.0	%			0.0	%			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(9.4	%)			10.5	%			4.3	%
Net income/(loss) margin			0.0	%			0.0	%			0.0	%			0.0	%			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(115.6	%)			(76.3	%)			(43.5	%)

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Table of Contents

Uzbekistan

(in US$ millions, unless stated otherwise, unaudited)

 

CONSOLIDATED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			18.2				23.2				30.2				36.5				39.5				52.0				58.4				66.5				58.5				52.6				50.1				50.2				45.3				51.4				53.8
Gross margin			15.2				20.0				25.8				31.0				33.4				43.0				48.6				52.8				47.1				41.2				37.7				37.9				34.3				39.2				39.2
Gross margin, %			83.5	%			86.2	%			85.4	%			84.9	%			84.6	%			82.7	%			83.2	%			79.4	%			80.5	%			78.3	%			75.2	%			75.5	%			75.7	%			76.3	%			72.9	%
Adjusted OIBDA			8.7				11.4				16.9				17.8				20.9				27.8				33.0				34.2				33.1				26.9				23.5				23.0				19.6				20.1				21.9
Adjusted OIBDA, %			47.8	%			49.1	%			56.0	%			48.8	%			52.9	%			53.5	%			56.5	%			51.4	%			56.6	%			51.1	%			46.9	%			45.8	%			43.3	%			39.1	%			40.7	%
SG&A			6.4				8.4				8.7				13.1				12.3				14.9				15.4				18.3				13.6				13.9				13.8				14.3				14.1				18.6				16.8
including Sales & Marketing Expenses			2.8				2.5				3.9				5.3				4.9				5.1				6.6				7.1				3.8				3.7				4.8				4.3				3.5				3.8				4.4
including advertising			0.7				0.9				1.1				1.4				2.0				1.9				2.3				2.3				0.9				1.4				1.6				1.0				1.0				1.2				1.3
including General & Administrative Costs			3.6				5.9				4.8				7.8				7.4				9.8				8.8				11.2				9.8				10.2				9.0				10.0				10.6				14.8				12.4
SG&A, %			35.2	%			36.2	%			28.8	%			35.9	%			31.1	%			28.7	%			26.4	%			27.5	%			23.2	%			26.4	%			27.5	%			28.5	%			31.1	%			36.2	%			31.2	%
Net Income attributable to VimpelCom Ltd			2.5				4.3				6.9				6.0				7.5				14.4				22.0				11.8				9.7				5.3				1.8				(1.5	)			(10.6	)			(2.9	)			(1.5	)
Capital Expenditures			7.9				18.5				23.8				83.6				47.9				82.8				28.4				17.3				1.1				7.4				7.2				21.1				17.9				28.5				22.4
MOBILE		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			18.2				23.2				30.2				36.5				38.7				49.5				55.5				63.5				55.5				49.5				46.8				47.5				42.9				48.9				51.4
including Mobile Interconnect			0.002				0.003				0.004				0.01				0.01				0.01				0.01				3.4				3.0				3.8				5.0				5.5				5.1				5.3				5.5
Adjusted OIBDA			8.7				11.4				16.9				17.8				20.6				27.3				32.0				33.0				31.9				25.7				22.2				22.0				18.6				19.2				20.9
Adjusted OIBDA, %			47.8	%			49.1	%			56.0	%			48.8	%			53.2	%			55.2	%			57.7	%			52.0	%			57.5	%			51.9	%			47.4	%			46.3	%			43.4	%			39.3	%			40.7	%
Subscriptions (‘000)			1,106.3				1,192.4				1,586.9				2,119.6				2,422.2				2,754.2				3,148.0				3,636.2				3,653.1				3,604.6				3,652.0				3,515.0				3,489.0				3,997.0				4,398.0
ARPU, US$			6.7				7.2				7.6				6.8				5.8				6.6				6.5				6.5				5.2				4.7				4.5				4.6				4.2				4.1				4.1
MOU, min			242.2				265.6				289.8				283.4				265.3				294.6				298.5				288.6				238.6				225.6				409.3				387.3				369.2				383.0				387.7
Churn 3 months active base (quarterly), %			n/a				n/a				n/a				11.2	%			12.8	%			13.1	%			14.2	%			14.9	%			15.1	%			11.2	%			17.4	%			20.1	%			14.7	%			3.7	%			11.7	%
FIXED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			—				—				—				—				0.8				2.5				2.9				3.0				3.0				3.1				3.3				2.7				2.4				2.5				2.4
including business segment			—				—				—				—				0.7				2.3				2.3				2.2				2.3				2.3				2.6				2.1				1.5				1.7				1.6
including wholesale segment			—				—				—				—				0.00				0.00				0.10				0.10				0.00				0.00				0.00				0.00				0.4				0.3				0.3
including residential segment			—				—				—				—				0.10				0.20				0.50				0.70				0.70				0.70				0.70				0.60				0.5				0.5				0.5
Adjusted OIBDA			—				—				—				—				0.3				0.5				1.0				1.2				1.2				1.2				1.3				1.0				1.0				0.9				1.0
Adjusted OIBDA, %			—				—				—				—				37.5	%			20.0	%			34.5	%			40.0	%			40.0	%			38.7	%			39.4	%			37.0	%			41.7	%			36.0	%			41.7	%
Broadband subscriptions (‘000)			—				—				—				—				—				—				—				5.8				6.8				7.6				8.3				9.0				17.7				21.2				23.3
BB subscriptions using USB modems (‘000)			—				—				—				—				—				—				—				0				0				0				0				0				7.7				10.5				12.9
BB fixed-line subscriptions (‘000)			—				—				—				—				—				—				—				5.8				6.8				7.6				8.3				9.0				10.0				10.7				10.4
Reconciliation of OIBDA Total		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			8.7				11.4				16.9				17.8				20.9				27.8				33.0				34.2				33.1				26.9				23.5				23.0				19.6				20.1				21.9
Depreciation			(3.1	)			(3.3	)			(4.0	)			(5.1	)			(6.7	)			(6.8	)			(7.2	)			(8.9	)			(11.4	)			(11.2	)			(12.4	)			(20.7	)			(21.9	)			(13.0	)			(14.4	)
Amortization			(3.4	)			(3.4	)			(3.4	)			(3.5	)			(3.8	)			(3.7	)			(3.8	)			(4.6	)			(4.1	)			(3.6	)			(3.5	)			(2.9	)			(3.4	)			(3.4	)			(3.4	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			2.2				4.7				9.5				9.2				10.4				17.3				22.0				20.7				17.6				12.1				7.6				(0.6	)			(5.7	)			3.7				4.1
Interest income			—				—				—				—				—				—				—				—				—				—				—				0.8				0.8				0.8				0.8
Net foreign exchange gain/(loss)			(0.3	)			—				(0.3	)			(0.5	)			(0.2	)			(0.2	)			(0.5	)			(3.7	)			(2.4	)			(3.5	)			(1.2	)			(0.1	)			(3.7	)			(3.1	)			(2.5	)
Interest expense			(0.3	)			(0.5	)			(1.0	)			(1.3	)			(1.6	)			(0.1	)			(0.4	)			(2.1	)			(3.3	)			(2.4	)			(3.5	)			(3.5	)			(3.5	)			(3.4	)			(3.1	)
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Other (expense)/income, net			(0.1	)			—				0.2				—				—				(0.3	)			2.6				(0.2	)			(0.2	)			(0.1	)			(0.1	)			(0.1	)			(0.1	)			(0.9	)			(1.5	)
Income tax expense			(1.0	)			(0.1	)			1.5				1.5				1.0				2.2				1.3				2.9				1.6				0.5				0.6				(2.4	)			(1.9	)			(0.2	)			(0.8	)
Net income/(loss)			2.5				4.3				6.9				5.9				7.6				14.5				22.4				11.8				10.1				5.6				2.2				(1.1	)			(10.3	)			(2.7	)			(1.4	)
Adjusted OIBDA margin as a percentage of net operating revenue			47.8	%			49.1	%			56.0	%			48.8	%			52.9	%			53.5	%			56.5	%			51.4	%			56.6	%			51.1	%			46.9	%			45.8	%			43.3	%			39.1	%			40.7	%
Depreciation			(17.0	%)			(14.1	%)			(13.2	%)			(14.0	%)			(17.0	%)			(13.1	%)			(12.3	%)			(13.4	%)			(19.5	%)			(21.3	%)			(24.7	%)			(41.2	%)			(48.4	%)			(25.3	%)			(26.8	%)
Amortization			(18.7	%)			(14.7	%)			(11.3	%)			(9.6	%)			(9.6	%)			(7.1	%)			(6.5	%)			(6.9	%)			(7.0	%)			(6.8	%)			(7.0	%)			(5.8	%)			(7.5	%)			(6.6	%)			(6.3	%)
Impairment loss			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income			12.1	%			20.3	%			31.5	%			25.2	%			26.3	%			33.3	%			37.7	%			31.1	%			30.1	%			23.0	%			15.2	%			(1.2	%)			(12.6	%)			7.2	%			7.6	%
Interest income			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			1.6	%			1.8	%			1.6	%			1.5	%
Net foreign exchange gain/(loss)			-1.6	%			0.0	%			-1.0	%			-1.4	%			-0.5	%			-0.4	%			-0.9	%			-5.6	%			-4.1	%			-6.7	%			-2.4	%			(0.2	%)			(8.2	%)			(6.0	%)			(4.6	%)
Interest expense			-1.6	%			-2.2	%			-3.3	%			-3.6	%			-4.1	%			-0.2	%			-0.7	%			-3.2	%			-5.6	%			-4.6	%			-7.0	%			(7.0	%)			(7.7	%)			(6.6	%)			(5.8	%)
Equity in net gain/(loss) of associates			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Other (expense)/income, net			-0.7	%			0.0	%			0.6	%			0.1	%			0.0	%			-0.6	%			4.5	%			-0.2	%			-0.4	%			-0.1	%			-0.2	%			(0.2	%)			(0.2	%)			(1.8	%)			(2.8	%)
Income tax expense			-5.5	%			-0.4	%			5.0	%			4.1	%			2.5	%			4.2	%			2.2	%			4.4	%			2.7	%			1.0	%			1.2	%			(4.8	%)			(4.2	%)			(0.4	%)			(1.5	%)
Net income/(loss)			13.7	%			18.5	%			22.8	%			16.2	%			19.2	%			27.9	%			38.4	%			17.7	%			17.3	%			10.6	%			4.4	%			(2.2	%)			(22.7	%)			(5.3	%)			(2.6	%)
Reconciliation of Adjusted OIBDA Mobile		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			8.7				11.4				16.9				17.8				20.6				27.3				32.0				33.0				31.9				25.7				22.2				22.0				18.6				19.2				20.9
Depreciation			(3.1	)			(3.3	)			(4.0	)			(5.1	)			(6.7	)			(6.3	)			(7.1	)			(8.6	)			(11.1	)			(10.9	)			(12.2	)			(20.4	)			(21.5	)			(12.7	)			(14.1	)
Amortization			(3.4	)			(3.4	)			(3.4	)			(3.5	)			(3.8	)			(3.7	)			(3.8	)			(4.6	)			(4.1	)			(3.6	)			(3.5	)			(2.9	)			(3.4	)			(3.4	)			(3.4	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			2.2				4.7				9.5				9.2				10.1				17.3				21.1				19.8				16.7				11.2				6.5				(1.3	)			(6.3	)			3.1				3.4
Interest income			—				—				—				—				—				—				—				—				—				—				—				0.8				0.8				0.8				0.8
Net foreign exchange gain/(loss)			(0.3	)			—				(0.3	)			(0.5	)			(0.2	)			(0.2	)			(0.5	)			(3.2	)			(2.4	)			(3.4	)			(1.2	)			(0.1	)			(3.6	)			(3.1	)			(2.6	)
Interest expense			(0.3	)			(0.5	)			(1.0	)			(1.3	)			(1.6	)			(0.1	)			(0.4	)			(2.1	)			(3.3	)			(2.4	)			(3.5	)			(3.5	)			(3.5	)			(3.4	)			(3.1	)
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Other (expense)/income, net			(0.1	)			—				0.2				—				0.1				(0.4	)			2.6				(0.3	)			(0.2	)			(0.1	)			—				(0.2	)			(0.2	)			(0.6	)			(0.6	)
Income tax expense			(1.0	)			(0.1	)			1.5				1.5				(1.0	)			(2.1	)			(1.2	)			(2.6	)			(1.4	)			(0.3	)			(0.4	)			2.4				2.0				0.2				0.7
Net income/(loss)			2.5				4.3				6.9				5.9				7.4				14.5				21.6				11.6				9.4				5.0				1.4				(1.9	)			(10.8	)			(3.0	)			(1.4	)
Adjusted OIBDA margin mobile as a percentage of net operating revenue			47.8	%			49.1	%			56.0	%			48.8	%			53.2	%			55.2	%			57.7	%			52.0	%			57.5	%			51.9	%			47.4	%			46.3	%			43.4	%			39.3	%			40.7	%
Depreciation			(17.0	%)			(14.1	%)			(13.2	%)			(14.0	%)			(17.3	%)			(12.7	%)			(12.8	%)			(13.5	%)			(20.0	%)			(22.0	%)			(26.1	%)			(42.9	%)			(50.1	%)			(26.0	%)			(27.4	%)
Amortization			(18.7	%)			(14.7	%)			(11.3	%)			(9.6	%)			(9.8	%)			(7.5	%)			(6.8	%)			(7.2	%)			(7.4	%)			(7.3	%)			(7.5	%)			(6.1	%)			(7.9	%)			(7.0	%)			(6.6	%)
Impairment loss			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income margin			12.1	%			20.3	%			31.5	%			25.2	%			26.1	%			34.9	%			38.0	%			31.2	%			30.1	%			22.6	%			13.9	%			(2.7	%)			(14.7	%)			6.3	%			6.6	%
Interest income			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			1.7	%			1.9	%			1.6	%			1.6	%
Net foreign exchange gain/(loss)			(1.6	%)			0.0	%			(1.0	%)			(1.4	%)			(0.5	%)			(0.4	%)			(0.9	%)			(5.0	%)			(4.3	%)			(6.9	%)			(2.6	%)			(0.2	%)			(8.4	%)			(6.3	%)			(5.1	%)
Interest expense			(1.6	%)			(2.2	%)			(3.3	%)			(3.6	%)			(4.1	%)			(0.2	%)			(0.7	%)			(3.3	%)			(5.9	%)			(4.8	%)			(7.5	%)			(7.4	%)			(8.2	%)			(7.0	%)			(6.0	%)
Equity in net gain/(loss) of associates			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Other (expense)/income, net			(0.7	%)			0.0	%			0.6	%			0.1	%			0.3	%			(0.8	%)			4.7	%			(0.5	%)			(0.4	%)			(0.2	%)			0.0	%			(0.4	%)			(0.5	%)			(1.2	%)			(1.2	%)
Income tax expense			(5.5	%)			(0.4	%)			5.0	%			4.1	%			(2.6	%)			(4.2	%)			(2.2	%)			(4.1	%)			(2.5	%)			(0.6	%)			(0.9	%)			5.1	%			4.7	%			0.4	%			1.4	%
Net income/(loss) margin			13.7	%			18.5	%			22.8	%			16.2	%			19.1	%			29.3	%			38.9	%			18.3	%			16.9	%			10.1	%			3.0	%			(4.0	%)			(25.2	%)			(6.1	%)			(2.7	%)
Reconciliation of Adjusted OIBDA Fixed		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			—				—				—				—				0.3				0.5				1.0				1.2				1.2				1.2				1.3				1.0				1.0				0.9				0.9
Depreciation			—				—				—				—				(0.1	)			(0.5	)			0.1				(0.3	)			(0.3	)			(0.3	)			(0.3	)			(0.3	)			(0.3	)			(0.3	)			(0.3	)
Amortization			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			—				—				—				—				0.2				—				1.1				0.9				0.9				0.9				1.0				0.7				0.7				0.6				0.6
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Net foreign exchange gain/(loss)			—				—				—				—				—				—				—				(0.5	)			—				(0.1	)			—				—				(0.1	)			—				—
Interest expense			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Other (expense)/income, net			—				—				—				—				—				—				—				—				—				—				—				0.1				(0.1	)			(0.2	)			(0.7	)
Income tax expense			—				—				—				—				—				—				(0.1	)			(0.2	)			(0.2	)			(0.2	)			(0.2	)			—				(0.1	)			(0.1	)			0.1
Net income/(loss)			—				—				—				—				0.2				—				1.0				0.2				0.7				0.6				0.8				0.8				0.4				0.3				—
Adjusted OIBDA margin fixed as a percentage of net operating revenue			0.0	%			0.0	%			0.0	%			0.0	%			37.5	%			20.0	%			34.5	%			40.0	%			40.0	%			38.7	%			39.4	%			37.0	%			41.7	%			36.0	%			37.5	%
Depreciation			0.0	%			0.0	%			0.0	%			0.0	%			(12.5	%)			(20.0	%)			3.4	%			(10.0	%)			(10.0	%)			(9.7	%)			(9.1	%)			(11.1	%)			(12.5	%)			(12.0	%)			(12.5	%)
Amortization			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Impairment loss			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income margin			0.0	%			0.0	%			0.0	%			0.0	%			25.0	%			0.0	%			37.9	%			30.0	%			30.0	%			29.0	%			30.3	%			25.9	%			29.2	%			24.0	%			25.0	%
Interest income			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Net foreign exchange gain/(loss)			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			(16.7	%)			0.0	%			(3.2	%)			0.0	%			0.0	%			(4.2	%)			0.0	%			0.0	%
Interest expense			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Equity in net gain/(loss) of associates			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Other (expense)/income, net			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			3.7	%			(4.2	%)			(8.0	%)			(29.2	%)
Income tax expense			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			(3.4	%)			(6.7	%)			(6.7	%)			(6.5	%)			(6.1	%)			0.0	%			(4.2	%)			(4.0	%)			4.2	%
Net income/(loss) margin			0.0	%			0.0	%			0.0	%			0.0	%			25.0	%			0.0	%			34.5	%			6.7	%			23.3	%			19.4	%			24.2	%			29.6	%			16.7	%			12.0	%			0.0	%

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Table of Contents

Armenia

(in US$ millions, unless stated otherwise, unaudited)

 

CONSOLIDATED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			54.1				58.4				63.4				59.8				59.1				64.7				68.8				63.7				52.7				49.2				51.4				47.3				41.7				44.5				48.7
Gross margin			42.4				46.0				49.8				47.3				45.8				50.0				52.6				48.7				41.3				37.8				38.8				35.3				30.8				31.7				35.0
Gross margin, %			78.4	%			78.8	%			78.5	%			79.1	%			77.5	%			77.3	%			76.5	%			76.5	%			78.4	%			76.8	%			75.5	%			74.6	%			73.9	%			71.2	%			71.9	%
Adjusted OIBDA			27.3				30.1				32.9				32.5				29.1				30.3				33.5				31.7				27.2				24.8				26.3				22.7				19.1				19.1				22.1
Adjusted OIBDA, %			50.5	%			51.5	%			51.9	%			54.3	%			49.2	%			46.8	%			48.7	%			49.8	%			51.6	%			50.4	%			51.2	%			48.0	%			45.8	%			42.9	%			45.4	%
SG&A			14.2				14.8				15.9				13.4				16.7				18.7				18.5				16.7				13.2				11.8				12.1				12.6				11.5				12.4				12.5
including Sales & Marketing Expenses			1.7				2.2				2.4				3.5				2.7				3.8				3.7				2.5				1.7				1.6				1.6				2.3				1.5				1.8				2.0
including advertising			0.6				0.8				0.8				1.7				1.2				1.6				1.1				1.2				0.6				0.6				0.5				1.1				0.6				0.8				0.9
including General & Administrative Costs			12.5				12.6				13.5				9.9				14.0				14.9				14.8				14.2				11.5				10.2				10.5				10.3				10.0				10.6				10.5
SG&A, %			26.2	%			25.3	%			25.1	%			22.4	%			28.3	%			28.9	%			26.9	%			26.2	%			25.0	%			24.0	%			23.5	%			26.6	%			27.6	%			27.9	%			25.7	%
Net Income attributable to VimpelCom Ltd			2.6				4.0				16.0				0.3				-15.0				-1.3				3.7				-12.0				10.0				4.2				2.7				-1.6				10.7				-1.9				0.4
Capital Expenditures			5.4				20.4				20.7				44.3				14.7				20.9				19.1				23.7				0.2				0.4				1.3				7.8				3.1				3.8				6.5
MOBILE		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			19.9				23.2				25.8				23.5				22.9				26.4				31.6				27.2				21.3				19.7				20.3				18.3				15.1				17.5				21.1
including Mobile Interconnect			2.3				3.2				4.1				4.2				4.5				5.3				8.0				7.1				5.2				5.1				5.4				5.1				4.1				4.5				4.7
Adjusted OIBDA			11.1				11.6				13.4				9.7				10.4				10.3				13.9				12.5				10.5				9.2				9.8				7.6				6.2				7.1				8.8
Adjusted OIBDA, %			55.8	%			50.0	%			51.9	%			41.3	%			45.4	%			39.0	%			44.0	%			46.0	%			49.3	%			46.7	%			48.3	%			41.5	%			41.1	%			40.6	%			41.7	%
Subscriptions (‘000)			439.9				471.0				447.0				442.4				520.4				654.5				783.6				544.3				480.8				486.3				502.0				545.0				549.0				567.0				581.0
ARPU, US$			14.5				17.3				17.6				17.4				16.1				15.3				13.9				13.6				13.9				13.6				13.7				11.5				9.0				10.3				11.4
MOU, min			141.3				185.1				181.0				171.8				158.9				164.9				139.9				150.0				174.7				238.4				269.0				268.2				345.6				270.1				286.7
Churn 3 months active base (quarterly), %			n/a				n/a				n/a				12.3	%			28.8	%			13.1	%			18.5	%			45.7	%			24.5	%			12.2	%			11.4	%			10.5	%			13.6	%			16.0	%			16.4	%
FIXED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			34.2				35.2				37.6				36.3				36.2				38.3				37.2				36.5				31.4				29.5				31.1				29.0				26.6				27.0				27.6
including business segment			0.0				0.0				0.0				0.0				0.0				0.0				0.0				0.0				0.0				0.0				0.0				6.0				5.4				5.6				5.9
including wholesale segment			0.0				0.0				0.0				0.0				0.0				0.0				0.0				0.0				0.0				0.0				0.0				4.7				8.7				8.4				7.8
including residential segment			34.2				35.2				37.6				36.3				36.2				38.3				37.2				36.5				31.4				29.5				31.1				18.3				12.5				13.0				13.9
Adjusted OIBDA			16.2				18.5				19.5				22.8				18.7				20.0				19.6				19.2				16.7				15.6				16.5				15.1				12.9				12.0				13.3
Adjusted OIBDA, %			47.4	%			52.6	%			51.9	%			62.8	%			51.7	%			52.2	%			52.7	%			52.6	%			53.2	%			52.9	%			53.1	%			52.1	%			48.5	%			44.4	%			48.2	%
Broadband subscriptions (‘000)			0				0				0				0				0				0				5.4				9.2				15.3				19.2				18.1				26.2				38.0				56.3				65.2
BB subscritions using USB modems (‘000)			0				0				0				0				0				0				0				0				0				0				0				0				6.8				6.6				7.4
BB fixed-line subscriptions (‘000)			0				0				0				0				0				0				5.4				9.2				15.3				19.2				18.1				26.2				31.2				49.7				57.8
Reconciliation of OIBDA Total		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			27.3				30.1				32.9				32.5				29.1				30.3				33.5				31.7				27.2				24.8				26.3				22.7				19.1				19.1				22.1
Depreciation			(13.9	)			(18.7	)			(10.6	)			(21.9	)			(27.0	)			(22.8	)			(13.2	)			(26.4	)			(14.0	)			(10.5	)			(15.7	)			(17.0	)			(9.8	)			(12.4	)			(18.5	)
Amortization			(5.9	)			(5.9	)			(7.0	)			(7.7	)			(10.1	)			(9.8	)			(10.0	)			(9.9	)			(6.6	)			(5.8	)			(5.8	)			(5.7	)			(1.3	)			(2.4	)			(1.9	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			7.5				5.5				15.3				2.9				(8.0	)			(2.3	)			10.3				(4.6	)			6.6				8.5				4.8				—				8.0				4.3				1.7
Interest income			0.1				0.2				0.2				0.3				0.3				0.4				0.5				0.7				0.9				1.3				1.1				1.1				1.3				1.5				1.7
Net foreign exchange gain/(loss)			(0.4	)			1.5				(1.4	)			1.5				(2.9	)			0.6				2.9				0.4				4.9				(2.5	)			1.1				(0.8	)			4.0				(5.6	)			(1.6	)
Interest expense			(0.6	)			(0.1	)			(0.3	)			(1.3	)			(0.7	)			(0.7	)			(0.5	)			(0.5	)			(0.4	)			(0.2	)			(0.3	)			(0.3	)			(0.2	)			(0.1	)			—
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Other (expense)/income, net			(0.9	)			(1.0	)			—				(1.3	)			(3.0	)			(1.5	)			(1.6	)			(4.3	)			(0.6	)			1.1				(1.9	)			(0.4	)			(0.4	)			(0.7	)			(0.3	)
Income tax expense			(2.9	)			(1.9	)			2.2				(1.8	)			(0.7	)			2.2				(7.9	)			(3.7	)			(1.4	)			(4.0	)			(2.1	)			(1.2	)			(2.0	)			(1.3	)			(1.1	)
Net income/(loss)			2.8				4.2				16.0				0.3				(15.0	)			(1.3	)			3.7				(12.0	)			10.0				4.2				2.7				(1.6	)			10.7				(1.9	)			0.4
Adjusted OIBDA margin as a percentage of net operating revenue			50.5	%			51.5	%			51.9	%			54.3	%			49.2	%			46.8	%			48.7	%			49.8	%			51.6	%			50.4	%			51.2	%			48.0	%			45.8	%			42.9	%			45.4	%
Depreciation			(25.7	%)			(32.0	%)			(16.8	%)			(36.6	%)			(45.6	%)			(35.3	%)			(19.2	%)			(41.5	%)			(26.6	%)			(21.3	%)			(30.6	%)			(35.9	%)			(23.5	%)			(27.8	%)			(38.0	%)
Amortization			(10.9	%)			(10.1	%)			(11.0	%)			(12.9	%)			(17.1	%)			(15.1	%)			(14.5	%)			(15.5	%)			(12.5	%)			(11.8	%)			(11.3	%)			(12.1	%)			(3.1	%)			(5.4	%)			(3.9	%)
Impairment loss			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income			13.9	%			9.4	%			24.1	%			4.8	%			(13.5	%)			(3.6	%)			15.0	%			(7.2	%)			12.5	%			17.3	%			9.3	%			0.0	%			19.2	%			9.7	%			3.5	%
Interest income			0.2	%			0.3	%			0.3	%			0.5	%			0.5	%			0.6	%			0.7	%			1.1	%			1.7	%			2.6	%			2.1	%			2.3	%			3.1	%			3.4	%			3.5	%
Net foreign exchange gain/(loss)			(0.7	%)			2.6	%			(2.2	%)			2.5	%			(4.9	%)			0.9	%			4.2	%			0.6	%			9.3	%			(5.1	%)			2.1	%			(1.7	%)			9.6	%			(12.6	%)			(3.3	%)
Interest expense			(1.1	%)			(0.2	%)			(0.5	%)			(2.2	%)			(1.2	%)			(1.1	%)			(0.7	%)			(0.8	%)			(0.8	%)			(0.4	%)			(0.6	%)			(0.6	%)			(0.5	%)			(0.2	%)			0.0	%
Equity in net gain/(loss) of associates			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Other (expense)/income, net			(1.7	%)			(1.6	%)			0.0	%			(2.1	%)			(5.1	%)			(2.2	%)			(2.3	%)			(6.7	%)			(1.0	%)			2.2	%			(3.5	%)			(0.9	%)			(0.9	%)			(1.6	%)			(0.6	%)
Income tax expense			(5.4	%)			(3.3	%)			3.5	%			(3.0	%)			(1.2	%)			3.4	%			(11.5	%)			(5.8	%)			(2.7	%)			(8.1	%)			(4.1	%)			(2.5	%)			(4.8	%)			(2.9	%)			(2.3	%)
Net income/(loss)			5.2	%			7.2	%			25.2	%			0.5	%			(25.4	%)			(2.0	%)			5.4	%			(18.8	%)			19.0	%			8.5	%			5.3	%			(3.4	%)			25.7	%			(4.3	%)			0.8	%
Reconciliation of Adjusted OIBDA Mobile		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			11.1				11.6				13.4				9.7				10.4				10.3				13.9				12.5				10.5				9.2				9.8				7.6				6.2				7.1				8.8
Depreciation			(4.2	)			(11.4	)			(3.8	)			(5.8	)			(18.9	)			(14.5	)			(5.0	)			(17.9	)			(5.4	)			(3.7	)			(4.7	)			(5.0	)			(2.7	)			(4.3	)			(5.6	)
Amortization			(1.1	)			(1.0	)			(1.9	)			(1.2	)			(1.1	)			(1.6	)			(1.0	)			(1.0	)			(0.9	)			(0.8	)			(0.8	)			(0.8	)			(0.8	)			(0.8	)			(0.9	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			5.8				(0.8	)			7.7				2.7				(9.6	)			(5.8	)			7.9				(6.4	)			4.2				4.7				4.3				1.8				2.7				2.0				2.3
Interest income			—				—				(0.1	)			(0.1	)			0.1				0.2				0.2				0.3				0.4				0.5				0.4				0.4				0.5				0.6				0.8
Net foreign exchange gain/(loss)			(0.2	)			0.6				(0.6	)			0.6				(1.1	)			0.3				1.3				0.2				2.0				(1.0	)			0.6				(0.3	)			1.5				(2.2	)			(0.8	)
Interest expense			(0.2	)			—				(0.1	)			(0.5	)			(0.3	)			(0.3	)			(0.2	)			(0.2	)			(0.2	)			(0.1	)			(0.1	)			(0.1	)			(0.1	)			—				—
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Other (expense)/income, net			(0.1	)			(0.4	)			0.2				(0.4	)			(3.1	)			(1.0	)			(0.9	)			(1.9	)			(0.5	)			0.6				(0.9	)			(0.3	)			(0.2	)			(0.4	)			0.2
Income tax expense			(1.1	)			(0.8	)			0.9				(0.7	)			(0.5	)			0.9				(3.1	)			(1.6	)			(0.6	)			(1.5	)			(0.8	)			(0.4	)			(0.7	)			(0.5	)			(0.6	)
Net income/(loss)			4.2				(1.4	)			8.0				1.6				(14.5	)			(5.7	)			5.2				(9.6	)			5.3				3.2				3.5				1.1				3.7				(0.5	)			1.9
Adjusted OIBDA margin mobile as a percentage of net operating revenue			55.8	%			50.0	%			51.9	%			41.3	%			45.4	%			39.0	%			44.0	%			46.0	%			49.3	%			46.7	%			48.3	%			41.5	%			41.1	%			40.6	%			41.7	%
Depreciation			(21.1	%)			(49.1	%)			(14.7	%)			(24.7	%)			(82.5	%)			(54.9	%)			(15.8	%)			(65.8	%)			(25.4	%)			(18.8	%)			(23.2	%)			(27.3	%)			(17.9	%)			(24.6	%)			(26.5	%)
Amortization			(5.5	%)			(4.3	%)			(7.4	%)			(5.1	%)			(4.8	%)			(6.1	%)			(3.2	%)			(3.7	%)			(4.2	%)			(4.1	%)			(3.9	%)			(4.4	%)			(5.3	%)			(4.6	%)			(4.3	%)
Impairment loss			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income margin			29.1	%			(3.4	%)			29.8	%			11.5	%			(41.9	%)			(22.0	%)			25.0	%			(23.5	%)			19.7	%			23.9	%			21.2	%			9.8	%			17.9	%			11.4	%			10.9	%
Interest income			0.0	%			0.0	%			(0.4	%)			(0.4	%)			0.4	%			0.8	%			0.6	%			1.1	%			1.9	%			2.5	%			2.0	%			2.2	%			3.3	%			3.4	%			3.8	%
Net foreign exchange gain/(loss)			(1.0	%)			2.6	%			(2.3	%)			2.6	%			(4.8	%)			1.1	%			4.1	%			0.7	%			9.4	%			(5.1	%)			3.0	%			(1.6	%)			9.9	%			(12.6	%)			(3.8	%)
Interest expense			(1.0	%)			0.0	%			(0.4	%)			(2.1	%)			(1.3	%)			(1.1	%)			(0.6	%)			(0.7	%)			(0.9	%)			(0.5	%)			(0.5	%)			(0.5	%)			(0.7	%)			0.0	%			0.0	%
Equity in net gain/(loss) of associates			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Other (expense)/income, net			(0.5	%)			(1.7	%)			0.8	%			(1.7	%)			(13.5	%)			(3.8	%)			(2.8	%)			(7.0	%)			(2.3	%)			3.0	%			(4.4	%)			(1.6	%)			(1.3	%)			(2.3	%)			0.9	%
Income tax expense			(5.5	%)			(3.4	%)			3.5	%			(3.0	%)			(2.2	%)			3.4	%			(9.8	%)			(5.9	%)			(2.8	%)			(7.6	%)			(3.9	%)			(2.2	%)			(4.6	%)			(2.9	%)			(2.8	%)
Net income/(loss) margin			21.1	%			(6.0	%)			31.0	%			6.8	%			(63.3	%)			(21.6	%)			16.5	%			(35.3	%)			24.9	%			16.2	%			17.2	%			6.0	%			24.5	%			(2.9	%)			9.0	%
Reconciliation of Adjusted OIBDA Fixed		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			16.2				18.5				19.6				22.8				18.7				20.0				19.6				19.2				16.7				15.6				16.5				15.1				12.9				12.0				13.2
Depreciation			(9.7	)			(7.3	)			(7.0	)			(16.1	)			(8.1	)			(8.3	)			(8.1	)			(8.5	)			(8.7	)			(6.9	)			(11.1	)			(12.0	)			(7.2	)			(8.0	)			(12.9	)
Amortization			(4.8	)			(4.8	)			(5.1	)			(6.5	)			(9.0	)			(8.2	)			(9.0	)			(8.9	)			(5.6	)			(5.0	)			(5.0	)			(4.9	)			(0.4	)			(1.6	)			(1.0	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			1.7				6.4				7.5				0.2				1.6				3.5				2.5				1.8				2.4				3.7				0.4				(1.8	)			5.3				2.4				(0.7	)
Interest income			(0.1	)			—				(0.1	)			(0.2	)			0.2				0.2				0.3				0.3				0.6				0.8				0.7				0.7				0.8				0.9				0.9
Net foreign exchange gain/(loss)			(0.3	)			0.9				(0.8	)			0.9				(1.8	)			0.4				1.6				0.3				2.9				(1.5	)			0.8				(0.5	)			2.5				(3.5	)			(0.8	)
Interest expense			(0.4	)			—				(0.2	)			(0.8	)			(0.4	)			(0.4	)			(0.3	)			(0.3	)			(0.3	)			(0.1	)			(0.2	)			(0.2	)			(0.1	)			—				—
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Other (expense)/income, net			(0.5	)			(0.6	)			0.3				(0.4	)			0.1				(0.6	)			(0.8	)			(2.4	)			(0.1	)			0.6				(1.2	)			(0.2	)			(0.2	)			(0.4	)			(0.4	)
Income tax expense			(1.8	)			(1.1	)			1.3				(1.1	)			(0.2	)			1.3				(4.8	)			(2.1	)			(0.8	)			(2.5	)			(1.3	)			(0.7	)			(1.3	)			(0.8	)			(0.5	)
Net income/(loss)			(1.4	)			5.6				8.0				(1.4	)			(0.5	)			4.4				(1.5	)			(2.4	)			4.7				1.0				(0.8	)			(2.7	)			7.0				(1.4	)			(1.5	)
Adjusted IBDA margin fixed as a percentage of net operating revenue			47.4	%			52.6	%			52.1	%			62.8	%			51.7	%			52.2	%			52.7	%			52.6	%			53.2	%			52.9	%			53.1	%			52.1	%			48.5	%			44.4	%			47.8	%
Depreciation			(28.4	%)			(20.7	%)			(18.6	%)			(44.4	%)			(22.4	%)			(21.7	%)			(21.8	%)			(23.3	%)			(27.7	%)			(23.4	%)			(35.7	%)			(41.4	%)			(27.1	%)			(29.6	%)			(46.7	%)
Amortization			(14.0	%)			(13.6	%)			(13.6	%)			(17.9	%)			(24.9	%)			(21.4	%)			(24.2	%)			(24.4	%)			(17.8	%)			(16.9	%)			(16.1	%)			(16.9	%)			(1.5	%)			(5.9	%)			(3.6	%)
Impairment loss			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income margin			5.0	%			18.2	%			19.9	%			0.6	%			4.4	%			9.1	%			6.7	%			4.9	%			7.6	%			12.5	%			1.3	%			(6.2	%)			19.9	%			8.9	%			(2.5	%)
Interest income			(0.3	%)			0.0	%			(0.3	%)			(0.6	%)			0.6	%			0.5	%			0.8	%			0.8	%			1.9	%			2.7	%			2.3	%			2.4	%			3.0	%			3.3	%			3.3	%
Net foreign exchange gain/(loss)			(0.9	%)			2.6	%			(2.1	%)			2.5	%			(5.0	%)			1.0	%			4.3	%			0.8	%			9.2	%			(5.1	%)			2.6	%			(1.7	%)			9.4	%			(13.0	%)			(2.9	%)
Interest expense			(1.2	%)			0.0	%			(0.5	%)			(2.2	%)			(1.1	%)			(1.0	%)			(0.8	%)			(0.8	%)			(1.0	%)			(0.3	%)			(0.6	%)			(0.7	%)			(0.4	%)			0.0	%			0.0	%
Equity in net gain/(loss) of associates			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Other (expense)/income, net			(1.5	%)			(1.7	%)			0.8	%			(1.1	%)			0.3	%			(1.6	%)			(2.2	%)			(6.6	%)			(0.3	%)			2.0	%			(3.9	%)			(0.7	%)			(0.8	%)			(1.5	%)			(1.4	%)
Income tax expense			(5.3	%)			(3.1	%)			3.5	%			(3.0	%)			(0.6	%)			3.4	%			(12.9	%)			(5.8	%)			(2.5	%)			(8.5	%)			(4.2	%)			(2.4	%)			(4.9	%)			(3.0	%)			(1.8	%)
Net income/(loss) margin			(4.1	%)			15.9	%			21.3	%			(3.9	%)			(1.4	%)			11.5	%			(4.0	%)			(6.6	%)			15.0	%			3.4	%			(2.6	%)			(9.3	%)			26.3	%			(5.2	%)			(5.4	%)

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Table of Contents

Tajikistan

(in US$ millions, unless stated otherwise, unaudited)

 

CONSOLIDATED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			2.9				5.2				7.7				8.1				8.4				11.2				14.8				16.4				14.4				14.3				14.9				15.6				14.8				20.1				22.2
Gross margin			1.6				3.2				5.2				5.1				5.2				7.2				10.0				11.5				10.3				10.5				11.4				11.6				10.8				13.0				14.2
Gross margin, %			55.2	%			61.5	%			67.5	%			63.0	%			61.9	%			64.3	%			67.6	%			70.1	%			71.5	%			73.4	%			76.5	%			74.4	%			73.0	%			64.7	%			64.0	%
Adjusted OIBDA			-0.3				0.1				1.6				1.4				1.3				2.6				4.8				5.3				4.9				5.4				5.2				7.1				4.4				6.7				8.8
Adjusted OIBDA, %			n/a				1.9	%			20.8	%			17.3	%			15.5	%			23.2	%			32.4	%			32.3	%			34.0	%			37.8	%			34.9	%			45.5	%			29.7	%			33.3	%			39.6	%
SG&A			1.9				3.1				3.5				3.5				4.0				4.5				5.2				6.2				5.4				5.1				6.2				4.5				6.3				5.3				5.4
including Sales & Marketing Expenses			0.8				1.3				1.5				1.4				1.2				1.4				1.7				1.7				1.3				1.1				1.0				1.0				1.2				0.9				1.1
including advertising			0.3				0.7				0.5				0.5				0.6				0.6				0.5				0.5				0.3				0.2				0.3				0.3				0.3				0.2				0.3
including General & Administrative Costs			1.1				1.8				2.0				2.1				2.8				3.1				3.5				4.5				4.1				4.0				5.2				3.5				5.1				4.4				4.3
SG&A, %			65.5	%			59.6	%			45.5	%			43.2	%			47.6	%			40.2	%			35.1	%			37.8	%			37.5	%			35.7	%			41.6	%			28.8	%			42.6	%			26.4	%			24.3	%
Net Income attributable to VimpelCom Ltd			-1.0				-1.8				-0.3				-2.5				-1.2				-3.0				-0.3				-0.7				-0.2				0.0				-0.3				0.6				-0.2				1.0				2.1
Capital Expenditures			13.5				5.7				6.1				20.2				7.2				13.5				6.4				17.9				0.4				0.8				0.5				5.4				0.1				3.5				2.4
MOBILE		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			2.9				5.2				7.7				8.1				8.4				11.2				14.8				16.4				14.4				14.3				14.9				15.6				13.3				14.9				16.5
including Mobile Interconnect			0.2				0.4				1.7				2.1				2.0				2.9				4.7				5.4				4.3				4.7				5.4				6.0				5.6				6.9				8.2
Adjusted OIBDA			-0.3				0.1				1.6				1.4				1.3				2.6				4.8				5.3				4.9				5.4				5.2				7.1				4.1				5.7				7.8
Adjusted OIBDA, %			n/a				1.9	%			20.8	%			17.3	%			15.5	%			23.2	%			32.4	%			32.3	%			34.0	%			37.8	%			34.9	%			45.5	%			30.8	%			38.3	%			47.3	%
Subscriptions (‘000)			145.3				204.9				268.4				339.4				377.9				435.3				526.6				624.6				722.3				677.1				706.0				743.0				820.0				784.0				772.0
ARPU, US$			8.7				10.1				10.8				9.0				8.0				9.4				10.4				9.6				7.1				6.9				7.2				7.2				5.6				6.1				7.1
MOU, min			205.8				224.2				230.3				216.3				205.8				241.1				255.9				243.4				171.7				173.1				173.3				173.6				157.9				167.6				191.2
Churn 3 months active base (quarterly), %			n/a				n/a				n/a				5.3	%			8.6	%			9.7	%			10.6	%			12.7	%			2.7	%			20.6	%			14.9	%			14.7	%			13.6	%			22.9	%			22.8	%
FIXED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			—				—				—				—				—				—				—				—				—				—				—				—				1.5				5.2				5.7
including business segment			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
including wholesale segment			—				—				—				—				—				—				—				—				—				—				—				—				1.5				5.2				5.7
including residential segment			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Adjusted OIBDA			—				—				—				—				—				—				—				—				—				—				—				—				0.3				1.0				1.0
Adjusted OIBDA, %			—				—				—				—				—				—				—				—				—				—				—				—				20.0	%			19.2	%			17.5	%
Broadband subscriptions (‘000)			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
BB subscritions using USB modems (‘000)			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
BB fixed-line subscriptions (‘000)			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Reconciliation of OIBDA Total		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			(0.3	)			0.1				1.6				1.4				1.3				2.6				4.8				5.3				4.9				5.4				5.2				7.1				4.4				6.7				8.8
Depreciation			(0.3	)			(0.6	)			(0.9	)			(1.5	)			(1.7	)			(3.1	)			(3.1	)			(3.5	)			(3.5	)			(3.5	)			(3.5	)			(4.7	)			(3.7	)			(4.1	)			(4.6	)
Amortization			(0.2	)			(0.2	)			(0.2	)			(0.2	)			(0.2	)			(0.3	)			(0.2	)			(0.2	)			(0.2	)			(0.3	)			(0.3	)			(0.3	)			(0.2	)			(0.3	)			(0.3	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			(0.8	)			(0.7	)			0.5				(0.3	)			(0.6	)			(0.8	)			1.5				1.6				1.2				1.6				1.4				2.1				0.5				2.3				3.9
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Net foreign exchange gain/(loss)			—				—				—				0.4				0.1				(0.2	)			0.1				—				(0.2	)			—				—				(0.2	)			(0.1	)			0.1				—
Interest expense			(0.6	)			(0.8	)			(0.9	)			(1.2	)			(1.4	)			(1.6	)			(1.8	)			(1.8	)			(1.7	)			(1.7	)			(1.6	)			(1.6	)			(1.5	)			(1.5	)			(1.3	)
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Other (expense)/income, net			(0.1	)			0.1				—				(0.1	)			0.1				(0.1	)			(0.2	)			(0.7	)			0.3				—				(0.3	)			0.1				—				—				(0.5	)
Income tax expense			0.3				(0.1	)			0.1				(1.5	)			0.6				0.1				0.1				0.2				0.1				0.1				0.1				0.3				0.8				0.4				0.3
Net income/(loss)			(1.2	)			(1.5	)			(0.3	)			(2.7	)			(1.2	)			(2.6	)			(0.3	)			(0.7	)			(0.3	)			0.0				(0.4	)			0.7				(0.3	)			1.3				2.4
Adjusted OIBDA margin as a percentage of net operating revenue			n/a				1.9	%			20.8	%			17.3	%			15.5	%			23.2	%			32.4	%			32.3	%			34.0	%			37.8	%			34.9	%			45.5	%			29.7	%			33.3	%			39.6	%
Depreciation			n/a				(11.6	%)			(11.7	%)			(18.5	%)			(20.2	%)			(27.6	%)			(20.9	%)			(21.3	%)			(24.3	%)			(24.5	%)			(23.5	%)			(30.1	%)			(24.9	%)			(20.4	%)			(20.6	%)
Amortization			n/a				(3.8	%)			(2.6	%)			(2.5	%)			(2.4	%)			(2.7	%)			(1.4	%)			(1.2	%)			(1.4	%)			(2.1	%)			(2.0	%)			(1.9	%)			(1.4	%)			(1.5	%)			(1.4	%)
Impairment loss			n/a				0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income			n/a				(13.5	%)			6.5	%			(3.7	%)			(7.1	%)			(7.1	%)			10.1	%			9.8	%			8.3	%			11.2	%			9.4	%			13.5	%			3.4	%			11.4	%			17.6	%
Interest income			n/a				0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Net foreign exchange gain/(loss)			n/a				0.0	%			0.0	%			4.9	%			1.2	%			(1.8	%)			0.7	%			0.0	%			(1.4	%)			0.0	%			0.0	%			(1.3	%)			(0.7	%)			0.5	%			0.0	%
Interest expense			n/a				(15.4	%)			(11.7	%)			(14.8	%)			(16.7	%)			(14.3	%)			(12.2	%)			(11.0	%)			(11.8	%)			(11.9	%)			(10.7	%)			(10.3	%)			(10.1	%)			(7.5	%)			(5.9	%)
Equity in net gain/(loss) of associates			n/a				0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Other (expense)/income, net			n/a				2.0	%			0.0	%			(1.2	%)			1.2	%			(0.9	%)			(1.3	%)			(4.3	%)			2.1	%			0.0	%			(2.1	%)			0.7	%			0.0	%			0.0	%			(2.3	%)
Income tax expense			n/a				(1.9	%)			1.3	%			(18.5	%)			7.1	%			0.9	%			0.7	%			1.2	%			0.7	%			0.7	%			0.7	%			1.9	%			5.4	%			2.0	%			1.4	%
Net income/(loss)			n/a				(28.8	%)			(3.9	%)			(33.3	%)			(14.3	%)			(23.2	%)			(2.0	%)			(4.3	%)			(2.1	%)			0.0	%			(2.7	%)			4.5	%			(2.0	%)			6.5	%			10.8	%
Reconciliation of Adjusted OIBDA Mobile		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			(0.3	)			0.1				1.6				1.4				1.3				2.6				4.8				5.3				4.9				5.4				5.2				7.1				4.1				5.7				7.7
Depreciation			(0.3	)			(0.6	)			(0.9	)			(1.5	)			(1.7	)			(3.1	)			(3.1	)			(3.5	)			(3.5	)			(3.5	)			(3.5	)			(4.7	)			(3.6	)			(4.1	)			(4.6	)
Amortization			(0.2	)			(0.2	)			(0.2	)			(0.2	)			(0.2	)			(0.3	)			(0.2	)			(0.2	)			(0.2	)			(0.3	)			(0.3	)			(0.3	)			(0.3	)			(0.3	)			(0.3	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			(0.8	)			(0.7	)			0.5				(0.3	)			(0.6	)			(0.8	)			1.5				1.6				1.2				1.6				1.4				2.1				0.2				1.3				2.8
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Net foreign exchange gain/(loss)			—				—				—				0.4				0.1				(0.2	)			0.1				—				(0.2	)			—				—				(0.2	)			(0.1	)			0.1				—
Interest expense			(0.6	)			(0.8	)			(0.9	)			(1.2	)			(1.4	)			(1.6	)			(1.8	)			(1.8	)			(1.7	)			(1.7	)			(1.6	)			(1.6	)			(1.5	)			(1.5	)			(1.3	)
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Other (expense)/income, net			(0.1	)			0.1				—				(0.1	)			0.1				(0.1	)			(0.2	)			(0.7	)			0.3				—				(0.3	)			0.1				(0.1	)			—				(0.5	)
Income tax expense			0.3				(0.1	)			0.1				(1.5	)			0.6				0.1				0.1				0.2				0.1				0.1				0.1				0.3				0.8				0.4				0.3
Net income/(loss)			(1.2	)			(1.5	)			(0.3	)			(2.7	)			(1.2	)			(2.6	)			(0.3	)			(0.7	)			(0.3	)			0.0				(0.4	)			0.7				(0.7	)			0.3				1.3
Adjusted OIBDA margin mobile as a percentage of net operating revenue			n/a				1.9	%			20.8	%			17.3	%			15.5	%			23.2	%			32.4	%			32.3	%			34.0	%			37.8	%			34.9	%			45.5	%			30.8	%			38.3	%			46.7	%
Depreciation			n/a				(11.6	%)			(11.7	%)			(18.5	%)			(20.2	%)			(27.7	%)			(20.9	%)			(21.3	%)			(24.3	%)			(24.5	%)			(23.5	%)			(30.1	%)			(27.1	%)			(27.5	%)			(27.9	%)
Amortization			n/a				(3.8	%)			(2.6	%)			(2.5	%)			(2.4	%)			(2.7	%)			(1.4	%)			(1.2	%)			(1.4	%)			(2.1	%)			(2.0	%)			(1.9	%)			(2.3	%)			(2.0	%)			(1.8	%)
Impairment loss			n/a				0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income margin			n/a				(13.5	%)			6.5	%			(3.7	%)			(7.1	%)			(7.1	%)			10.1	%			9.8	%			8.3	%			11.2	%			9.4	%			13.5	%			1.5	%			8.7	%			17.0	%
Interest income			n/a				0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Net foreign exchange gain/(loss)			n/a				0.0	%			0.0	%			4.9	%			1.2	%			(1.8	%)			0.7	%			0.0	%			(1.4	%)			0.0	%			0.0	%			(1.3	%)			(0.8	%)			0.7	%			0.0	%
Interest expense			n/a				(15.4	%)			(11.7	%)			(14.8	%)			(16.7	%)			(14.3	%)			(12.2	%)			(11.0	%)			(11.8	%)			(11.9	%)			(10.7	%)			(10.3	%)			(11.3	%)			(10.1	%)			(7.9	%)
Equity in net gain/(loss) of associates			n/a				0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Other (expense)/income, net			n/a				2.0	%			0.0	%			(1.2	%)			1.2	%			(0.9	%)			(1.4	%)			(4.3	%)			2.1	%			0.0	%			(2.0	%)			0.6	%			(0.8	%)			0.0	%			(3.0	%)
Income tax expense			n/a				(1.9	%)			1.3	%			(18.5	%)			7.1	%			0.9	%			0.7	%			1.2	%			0.7	%			0.7	%			0.7	%			1.9	%			6.0	%			2.7	%			1.8	%
Net income/(loss) margin			n/a				(28.8	%)			(3.9	%)			(33.3	%)			(14.3	%)			(23.2	%)			(2.0	%)			(4.3	%)			(2.1	%)			0.0	%			(2.7	%)			4.5	%			(5.3	%)			2.0	%			7.9	%
Reconciliation of Adjusted OIBDA Fixed		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			—				—				—				—				—				—				—				—				—				—				—				—				0.3				1.0				1.0
Depreciation			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Amortization			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Operating income			—				—				—				—				—				—				—				—				—				—				—				—				0.3				1.0				1.0
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Net foreign exchange gain/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Interest expense			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Other (expense)/income, net			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Income tax expense			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Net income/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				0.3				1.0				1.0
			—				—				—				—				—				—				—				—				—				—				—				—
Adjusted OIBDA margin fixed as a percentage of net operating revenue			—				—				—				—				—				—				—				—				—				—				—				—				20.0	%			19.2	%			17.5	%
Depreciation			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Amortization			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Operating income margin			—				—				—				—				—				—				—				—				—				—				—				—				20.0	%			19.2	%			17.5	%
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Net foreign exchange gain/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Interest expense			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Other (expense)/income, net			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Income tax expense			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Net income/(loss) margin			—				—				—				—				—				—				—				—				—				—				—				—				20.0	%			19.2	%			17.5	%

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Table of Contents

Georgia

(in US$ millions, unless stated otherwise, unaudited)

 

CONSOLIDATED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			0.03				0.2				0.3				0.9				2.4				3.9				5.4				5.9				6.0				7.1				8.9				10.2				10.9				11.5				13.0
Gross margin			0.00				-0.01				0.03				0.24				0.8				1.6				2.6				2.6				2.9				3.6				4.7				5.1				5.7				6.1				8.4
Gross margin, %			n/a				n/a				10.0	%			26.7	%			33.3	%			41.0	%			48.1	%			44.1	%			48.3	%			50.7	%			52.8	%			50.0	%			52.3	%			53.0	%			64.6	%
Adjusted OIBDA			-1.2				-1.9				-2.0				-2.3				-2.2				-2.1				-1.1				-1.2				-0.5				0.1				1.0				0.4				1.1				1.5				3.5
Adjusted OIBDA, %			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				1.4	%			11.2	%			3.9	%			10.1	%			13.0	%			26.9	%
SG&A			1.2				1.9				2.1				2.6				3.0				3.7				3.7				3.8				3.4				3.5				3.8				4.7				4.5				4.5				4.8
including Sales & Marketing Expenses			0.2				0.3				0.4				0.6				0.6				0.6				0.8				0.9				0.6				0.7				0.8				1.1				1.1				0.9				1.0
including advertising			0.0				1.2				0.3				0.4				0.3				0.4				0.6				0.6				0.2				0.2				0.3				0.4				0.3				0.4				0.4
including General & Administrative Costs			1.0				1.6				1.7				2.0				2.4				3.1				2.9				2.9				2.8				2.8				3.0				3.6				3.4				3.6				3.8
SG&A, %			n/a				950.0	%			700.0	%			288.9	%			125.0	%			94.9	%			68.5	%			64.4	%			56.7	%			49.3	%			42.7	%			46.1	%			41.3	%			39.1	%			36.9	%
Net Income attributable to VimpelCom Ltd			-1.9				-2.0				-2.3				-1.4				0.1				-1.5				-5.3				-30.7				-3.6				-2.9				-4.1				-3.9				-6.1				-7.5				-0.2
Capital Expenditures			16.6				9.4				4.8				28.9				7.0				12.2				8.9				7.0				1.6				2.1				2.5				3.3				4.3				8.9				6.0
MOBILE		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			0.03				0.2				0.3				0.9				2.4				3.9				5.4				5.9				6.0				7.1				8.9				10.2				10.6				11.1				12.6
including Mobile Interconnect			0.00				0.0				0.1				0.2				0.6				0.9				1.3				1.5				1.5				1.8				2.4				2.5				2.3				2.6				3.2
Adjusted OIBDA			-1.2				-1.9				-2.0				-2.3				-2.2				-2.1				-1.1				-1.2				-0.5				0.1				1.0				0.4				1.1				1.5				3.5
Adjusted OIBDA, %			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				1.4	%			11.2	%			3.9	%			10.4	%			13.5	%			27.8	%
Subscriptions (‘000)			7.3				14.0				26.6				72.7				146.2				168.6				189.0				225.1				246.4				289.2				341.0				399.0				431.0				466.0				529.0
ARPU, US$			3.2				4.8				6.3				9.0				7.4				8.2				9.9				9.7				8.4				8.8				9.2				8.4				7.5				7.9				8.1
MOU, min			47.9				82.5				85.1				121.5				87.1				89.3				109.8				129.8				121.2				123.1				129.3				131.1				125.0				140.5				147.4
Churn 3 months active base (quarterly), %			n/a				n/a				n/a				17.6	%			1.4	%			16.8	%			13.8	%			11.7	%			7.8	%			10.8	%			10.7	%			15.7	%			11.2	%			12.0	%			11.4	%
FIXED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			—				—				—				—				—				—				—				—				—				—				—				—				0.3				0.4				0.4
including business segment			—				—				—				—				—				—				—				—				—				—				—				—				0				0				1
including wholesale segment			—				—				—				—				—				—				—				—				—				—				—				—				0.3				0.4				0.4
including residential segment			—				—				—				—				—				—				—				—				—				—				—				—				0				0				1
Adjusted OIBDA			—				—				—				—				—				—				—				—				—				—				—				—				0.02				0.03				0.07
Adjusted OIBDA, %			—				—				—				—				—				—				—				—				—				—				—				—				6.7	%			7.5	%			17.5	%
Broadband subscriptions (‘000)			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
BB subscriptions using USB modems (‘000)			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
BB fixed-line subscriptions (‘000)			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Reconciliation of OIBDA Total		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			(1.2	)			(1.9	)			(2.0	)			(2.3	)			(2.2	)			(2.1	)			(1.1	)			(1.2	)			(0.5	)			0.1				1.0				0.4				1.1				1.5				3.5
Depreciation			(0.1	)			(0.5	)			(0.8	)			(1.1	)			(1.5	)			(1.9	)			(2.1	)			(2.7	)			(2.9	)			(2.9	)			(2.8	)			(3.1	)			(2.8	)			(3.1	)			(3.9	)
Amortization			(0.9	)			(1.2	)			(1.3	)			(1.3	)			(1.3	)			(2.0	)			(2.0	)			(1.8	)			(1.7	)			(1.7	)			(1.7	)			(1.6	)			(1.6	)			(1.5	)			(1.5	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			(2.2	)			(3.6	)			(4.1	)			(4.7	)			(5.0	)			(6.0	)			(5.2	)			(5.7	)			(5.1	)			(4.5	)			(3.5	)			(4.3	)			(3.3	)			(3.1	)			(1.9	)
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Net foreign exchange gain/(loss)			0.2				0.6				0.3				2.4				6.5				4.1				1.1				(22.8	)			(0.3	)			1.2				(1.8	)			(0.9	)			(6.1	)			(8.8	)			3.7
Interest expense			(0.4	)			(0.6	)			(0.9	)			(1.2	)			(1.5	)			(1.9	)			(2.2	)			(2.6	)			(2.5	)			(2.7	)			(2.7	)			(2.7	)			(2.8	)			(2.8	)			(2.9	)
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Other (expense)/income, net			—				—				—				0.1				(0.1	)			0.1				(0.1	)			0.1				—				(0.2	)			(0.1	)			0.1				—				(0.2	)			0.1
Income tax expense			(1.3	)			(0.3	)			0.2				0.6				0.3				0.8				0.5				0.3				0.8				0.5				0.1				0.2				0.2				0.1				0.6
Net income/(loss)			(3.7	)			(3.9	)			(4.5	)			(2.8	)			0.2				(2.9	)			(5.9	)			(30.7	)			(7.1	)			(5.7	)			(8.0	)			(7.6	)			(12.0	)			(14.8	)			(0.4	)
Adjusted OIBDA margin as a percentage of net operating revenue			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				1.4	%			11.2	%			3.9	%			10.1	%			13.0	%			26.9	%
Depreciation			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(40.8	%)			(31.5	%)			(30.4	%)			(25.7	%)			(27.0	%)			(30.0	%)
Amortization			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(23.9	%)			(19.1	%)			(15.7	%)			(14.7	%)			(13.0	%)			(11.5	%)
Impairment loss			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(63.4	%)			(39.3	%)			(42.2	%)			(30.3	%)			(27.0	%)			(14.6	%)
Interest income			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Net foreign exchange gain/(loss)			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				16.9	%			(20.2	%)			(8.8	%)			(55.9	%)			(76.5	%)			28.5	%
Interest expense			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(38.0	%)			(30.3	%)			(26.5	%)			(25.7	%)			(24.3	%)			(22.3	%)
Equity in net gain/(loss) of associates			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Other (expense)/income, net			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(2.8	%)			(1.2	%)			1.0	%			0.0	%			(1.7	%)			0.8	%
Income tax expense			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				7.0	%			1.1	%			2.0	%			1.8	%			0.9	%			4.6	%
Net income/(loss)			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(80.3	%)			(89.9	%)			(74.5	%)			(110.1	%)			(128.7	%)			(3.1	%)
Reconciliation of Adjusted OIBDA Mobile		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			(1.2	)			(1.9	)			(2.0	)			(2.3	)			(2.2	)			(2.1	)			(1.1	)			(1.2	)			(0.5	)			0.1				1.0				0.4				1.1				1.5				3.4
Depreciation			(0.1	)			(0.5	)			(0.8	)			(1.1	)			(1.5	)			(1.9	)			(2.1	)			(2.7	)			(2.9	)			(2.9	)			(2.8	)			(3.1	)			(2.8	)			(3.1	)			(3.9	)
Amortization			(0.9	)			(1.2	)			(1.3	)			(1.3	)			(1.3	)			(2.0	)			(2.0	)			(1.8	)			(1.7	)			(1.7	)			(1.7	)			(1.6	)			(1.6	)			(1.5	)			(1.5	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			(2.2	)			(3.6	)			(4.1	)			(4.7	)			(5.0	)			(6.0	)			(5.2	)			(5.7	)			(5.1	)			(4.5	)			(3.5	)			(4.3	)			(3.3	)			(3.1	)			(2.0	)
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Net foreign exchange gain/(loss)			0.2				0.6				0.3				2.4				6.5				4.1				1.1				(22.8	)			(0.3	)			1.2				(1.8	)			(0.9	)			(6.1	)			(8.8	)			3.7
Interest expense			(0.4	)			(0.6	)			(0.9	)			(1.2	)			(1.5	)			(1.9	)			(2.2	)			(2.6	)			(2.5	)			(2.7	)			(2.7	)			(2.7	)			(2.8	)			(2.8	)			(2.9	)
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Other (expense)/income, net			—				—				—				0.1				(0.1	)			0.1				(0.1	)			0.1				—				(0.2	)			(0.1	)			0.1				—				(0.1	)			0.1
Income tax expense			(1.3	)			(0.3	)			0.2				0.6				0.3				0.8				0.5				0.3				0.8				0.5				0.1				0.2				0.2				0.1				0.6
Net income/(loss)			(3.7	)			(3.9	)			(4.5	)			(2.8	)			0.2				(2.9	)			(5.9	)			(30.7	)			(7.1	)			(5.7	)			(8.0	)			(7.6	)			(12.0	)			(14.7	)			(0.5	)
Adjusted OIBDA margin mobile as a percentage of net operating revenue			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				1.4	%			11.2	%			3.9	%			10.4	%			13.5	%			27.0	%
Depreciation			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(40.8	%)			(31.5	%)			(30.4	%)			(26.4	%)			(27.9	%)			(31.0	%)
Amortization			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(23.9	%)			(19.1	%)			(15.7	%)			(15.1	%)			(13.5	%)			(11.9	%)
Impairment loss			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Operating income margin			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(63.4	%)			(39.3	%)			(42.2	%)			(31.1	%)			(27.9	%)			(15.9	%)
Interest income			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				0.0	%			0.0	%			0.0	%			0.3	%			0.1	%			0.1	%
Net foreign exchange gain/(loss)			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				16.9	%			(20.2	%)			(8.8	%)			(57.5	%)			(79.3	%)			29.4	%
Interest expense			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(38.0	%)			(30.3	%)			(26.5	%)			(26.4	%)			(25.2	%)			(23.0	%)
Equity in net gain/(loss) of associates			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				0.0	%			0.0	%			0.0	%			0.0	%			0.0	%			0.0	%
Other (expense)/income, net			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(2.8	%)			(1.1	%)			1.0	%			0.0	%			(0.9	%)			0.8	%
Income tax expense			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				7.0	%			1.1	%			2.0	%			1.9	%			0.9	%			4.8	%
Net income/(loss) margin			n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				(51.4	%)			(72.1	%)			(68.5	%)			(107.8	%)			(132.3	%)			(3.9	%)
Reconciliation of Adjusted OIBDA Fixed		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			—				—				—				—				—				—				—				—				—				—				—				—				0.02				0.03				0.07
Depreciation			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Amortization			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Operating income			—				—				—				—				—				—				—				—				—				—				—				—				0.02				0.03				0.07
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Net foreign exchange gain/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Interest expense			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Other (expense)/income, net			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Income tax expense			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Net income/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				0.02				0.03				0.07
Adjusted OIBDA margin fixed as a percentage of net operating revenue			—				—				—				—				—				—				—				—				—				—				—				—				6.7	%			7.5	%			17.5	%
Depreciation			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Amortization			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Operating income margin			—				—				—				—				—				—				—				—				—				—				—				—				6.7	%			7.5	%			17.5	%
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Net foreign exchange gain/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Interest expense			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Other (expense)/income, net			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Income tax expense			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Net income/(loss) margin			—				—				—				—				—				—				—				—				—				—				—				—				6.7	%			7.5	%			17.5	%

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Table of Contents

Kyrgizia

(in US$ millions, unless stated otherwise, unaudited)

 

CONSOLIDATED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			—				—				—				—				—				—				—				—				—				—				—				—				25.5				27.5				29.3
Gross margin			—				—				—				—				—				—				—				—				—				—				—				—				20.0				21.4				21.8
Gross margin, %			—				—				—				—				—				—				—				—				—				—				—				—				78.4	%			77.8	%			74.4	%
Adjusted OIBDA			—				—				—				—				—				—				—				—				—				—				—				—				9.5				12.8				12.2
Adjusted OIBDA, %			—				—				—				—				—				—				—				—				—				—				—				—				37.3	%			46.5	%			41.6	%
SG&A			—				—				—				—				—				—				—				—				—				—				—				—				7.5				8.5				9.2
including Sales & Marketing Expenses			—				—				—				—				—				—				—				—				—				—				—				—				1.6				1.0				1.2
including advertising			—				—				—				—				—				—				—				—				—				—				—				—				0.5				0.2				0.3
including General & Administrative Costs			—				—				—				—				—				—				—				—				—				—				—				—				5.9				7.5				8.0
SG&A, %			—				—				—				—				—				—				—				—				—				—				—				—				29.4	%			30.9	%			31.4	%
Net Income attributable to VimpelCom Ltd			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Capital Expenditures			—				—				—				—				—				—				—				—				—				—				—				—				1.0				0.2				2.5
MOBILE		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			—				—				—				—				—				—				—				—				—				—				—				—				25.5				27.5				29.3
including Mobile Interconnect			—				—				—				—				—				—				—				—				—				—				—				—				6.0				7.8				8.5
Adjusted OIBDA			—				—				—				—				—				—				—				—				—				—				—				—				9.5				12.8				12.2
Adjusted OIBDA, %			—				—				—				—				—				—				—				—				—				—				—				—				37.3	%			46.5	%			41.6	%
Subscriptions (‘000)			—				—				—				—				—				—				—				—				—				—				—				—				1,774				1,722				1,766
ARPU, US$			—				—				—				—				—				—				—				—				—				—				—				—				4.7				5.3				5.6
MOU, min			—				—				—				—				—				—				—				—				—				—				—				—				193.9				235.9				288.2
Churn 3 months active base (quarterly), %			—				—				—				—				—				—				—				—				—				—				—				—				17.2	%			17.3	%			15.4	%
FIXED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
including business segment			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
including wholesale segment			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
including residential segment			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Adjusted OIBDA			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Adjusted OIBDA, %			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Broadband subscriptions (‘000)			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
BB subscritions using USB modems (‘000)			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
BB fixed-line subscriptions (‘000)			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Reconciliation of OIBDA Total		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			—				—				—				—				—				—				—				—				—				—				—				—				9.5				12.8				12.2
Depreciation			—				—				—				—				—				—				—				—				—				—				—				—				(3.3	)			(3.4	)			(3.8	)
Amortization			—				—				—				—				—				—				—				—				—				—				—				—				(0.8	)			(0.8	)			(8.3	)
Operating income			—				—				—				—				—				—				—				—				—				—				—				—				5.4				8.6				0.1
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				0.7				0.3				0.2
Net foreign exchange gain/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				0.4				0.2				0.0
Interest expense			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				-0.1
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				0.0				0.0				0.0
Other (expense)/income, net			—				—				—				—				—				—				—				—				—				—				—				—				0.1				0.1				-3.5
Income tax expense			—				—				—				—				—				—				—				—				—				—				—				—				(0.6	)			(1.4	)			0.9
Net income/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				6.0				7.8				-2.4
Adjusted OIBDA margin as a percentage of net operating revenue			—				—				—				—				—				—				—				—				—				—				—				—				37.3	%			46.5	%			41.6	%
Depreciation			—				—				—				—				—				—				—				—				—				—				—				—				(13.0	%)			(12.3	%)			(13.0	%)
Amortization			—				—				—				—				—				—				—				—				—				—				—				—				(3.1	%)			(2.9	%)			(28.3	%)
Operating income			—				—				—				—				—				—				—				—				—				—				—				—				21.2	%			31.3	%			0.3	%
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				2.7	%			1.1	%			0.7	%
Net foreign exchange gain/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				1.6	%			0.7	%			0.0	%
Interest expense			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			(0.3	%)
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Other (expense)/income, net			—				—				—				—				—				—				—				—				—				—				—				—				0.4	%			0.4	%			(11.9	%)
Income tax expense			—				—				—				—				—				—				—				—				—				—				—				—				(2.4	%)			(5.1	%)			3.1	%
Net income/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				23.5	%			28.4	%			(8.2	%)
Reconciliation of Adjusted OIBDA Mobile		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			—				—				—				—				—				—				—				—				—				—				—				—				9.5				12.8				12.2
Depreciation			—				—				—				—				—				—				—				—				—				—				—				—				(3.3	)			(3.4	)			(3.8	)
Amortization			—				—				—				—				—				—				—				—				—				—				—				—				(0.8	)			(0.8	)			(8.3	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			—				—				—				—				—				—				—				—				—				—				—				—				5.4				8.6				0.1
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				0.7				0.3				0.2
Net foreign exchange gain/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				0.4				0.2				—
Interest expense			—				—				—				—				—				—				—				—				—				—				—				—				—				—				(0.1	)
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Other (expense)/income, net			—				—				—				—				—				—				—				—				—				—				—				—				0.1				0.1				(3.5	)
Income tax expense			—				—				—				—				—				—				—				—				—				—				—				—				(0.6	)			(1.4	)			0.9
Net income/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				6.0				7.8				(2.4	)
Adjusted OIBDA margin mobile as a percentage of net operating revenue			—				—				—				—				—				—				—				—				—				—				—				—				37.3	%			46.5	%			41.6	%
Depreciation			—				—				—				—				—				—				—				—				—				—				—				—				-13.0	%			-12.3	%			-13.0	%
Amortization			—				—				—				—				—				—				—				—				—				—				—				—				-3.1	%			-2.9	%			-28.3	%
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Operating income margin			—				—				—				—				—				—				—				—				—				—				—				—				21.2	%			31.3	%			0.3	%
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				2.7	%			1.1	%			0.7	%
Net foreign exchange gain/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				1.6	%			0.7	%			0.0	%
Interest expense			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			(0.3	%)
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				0.0	%			0.0	%			0.0	%
Other (expense)/income, net			—				—				—				—				—				—				—				—				—				—				—				—				0.4	%			0.4	%			(11.9	%)
Income tax expense			—				—				—				—				—				—				—				—				—				—				—				—				(2.4	%)			(5.1	%)			3.1	%
Net income/(loss) margin			—				—				—				—				—				—				—				—				—				—				—				—				23.5	%			28.4	%			(8.2	%)
Reconciliation of Adjusted OIBDA Fixed		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Depreciation			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Amortization			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Operating income			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Net foreign exchange gain/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Interest expense			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Other (expense)/income, net			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Income tax expense			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Net income/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Adjusted OIBDA margin fixed as a percentage of net operating revenue			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Depreciation			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Amortization			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Operating income margin			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Net foreign exchange gain/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Interest expense			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Other (expense)/income, net			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Income tax expense			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0
Net income/(loss) margin			—				—				—				—				—				—				—				—				—				—				—				—				0				0				0

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Table of Contents

SEA

(in US$ millions, unless stated otherwise, unaudited)

 

CONSOLIDATED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			—				—				—				—				—				—				0.0				0.0				0.0				0.9				2.4				2.4				4.4				5.5				5.0
Gross margin			—				—				—				—				—				—				0.0				0.0				0.0				-1.0				-0.7				0.5				2.3				2.8				2.6
Gross margin, %			—				—				—				—				—				—				n/a				n/a				n/a				-111.1	%			-29.2	%			20.8	%			52.3	%			50.9	%			52.0	%
Adjusted OIBDA			—				—				—				—				—				—				0.6				-1.3				-3.8				-8.5				-13.2				-12.6				-8.6				-8.1				-8.8
Adjusted OIBDA, %			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				-176.0	%
SG&A			—				—				—				—				—				—				-0.6				1.3				3.8				7.5				12.5				13.1				10.9				10.9				11.4
including Sales & Marketing Expenses			—				—				—				—				—				—				0.0				0.0				0.0				2.2				2.7				2.5				3.0				3.1				2.8
including advertising			—				—				—				—				—				—				0.0				0.0				0.0				1.6				1.3				1.2				0.7				1.3				1.1
including General & Administrative Costs			—				—				—				—				—				—				-0.6				1.3				3.8				5.3				9.8				10.6				7.9				7.8				8.6
SG&A, %			—				—				—				—				—				—				n/a				n/a				n/a				833.3	%			520.8	%			545.8	%			247.7	%			198.2	%			228.0	%
Net Income attributable to VimpelCom Ltd			—				—				—				—				—				—				0.6				0.5				-0.8				-13.3				-22.1				-31.7				-18.3				-20.5				-22.3
Capital Expenditures			—				—				—				—				—				—				0.4				7.4				12.9				23.6				8.2				22.8				16.9				8.8				8.2
MOBILE		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			—				—				—				—				—				—				0				0				0				0.9				2.4				2.4				4.4				5.5				5
including Mobile Interconnect			—				—				—				—				—				—				0				0				0				0				0.2				0.3				0.6				0.8				0.9
Adjusted OIBDA			—				—				—				—				—				—				0.6				-1.3				-3.8				-8.5				-13.2				-12.6				-8.6				-8.1				-8.8
Adjusted OIBDA, %			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Subscriptions (‘000)			—				—				—				—				—				—				0				0				0				79	*			95	*			367				491				525				505
ARPU, US$			—				—				—				—				—				—				0				0				0				n/m				n/m				n/m				3.5				3.4				3.2
MOU, min			—				—				—				—				—				—				0				0				0				n/m				n/m				n/m				350.7				340.7				230.5
Churn 3 months active base (quarterly), %			—				—				—				—				—				—				0				0				0				n/m				n/m				n/m				n/m				n/m				49.6	%
* In 2Q ‘09 and 3Q ‘09 we reported 79 and 95 thousands as active subscriptions in Cambodia which were calculated on a one month basis. Starting from 4Q09 we report active subscriptions base in Cambodia calculated on a three month basis.
FIXED		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Net operating revenues			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
including business segment			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
including wholesale segment			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
including residential segment			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Adjusted OIBDA			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Adjusted OIBDA, %			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Broadband subscriptions (‘000)			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
BB subscritions using USB modems (‘000)			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
BB fixed-line subscriptions (‘000)			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Reconciliation of OIBDA Total		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			—				—				—				—				—				—				0.6				(1.3	)			(3.8	)			(8.5	)			(13.2	)			(12.6	)			(8.6	)			(8.1	)			(8.8	)
Depreciation			—				—				—				—				—				—				—				—				—				(0.3	)			(1.5	)			(2.3	)			(2.7	)			(3.1	)			(3.5	)
Amortization			—				—				—				—				—				—				—				—				—				(0.2	)			(0.5	)			(0.3	)			(0.4	)			(0.4	)			(0.2	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			—				—				—				—				—				—				0.6				(1.3	)			(3.8	)			(9.0	)			(15.2	)			(15.2	)			(11.7	)			(11.6	)			(12.5	)
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Net foreign exchange gain/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				0.1				—				—
Interest expense			—				—				—				—				—				—				—				—				(0.3	)			(0.7	)			(1.3	)			(1.7	)			(1.8	)			(2.2	)			(2.7	)
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				1.8				3.1				(4.3	)			(6.7	)			(15.8	)			(5.9	)			(7.8	)			(8.4	)
Other (expense)/income, net			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Income tax expense			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Net income/(loss)			—				—				—				—				—				—				0.6				0.5				(1.0	)			(14.0	)			(23.2	)			(32.7	)			(19.3	)			(21.6	)			(23.6	)
Adjusted OIBDA margin total as a percentage of net operating revenue			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Depreciation			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Amortization			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Impairment loss			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Operating income			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Interest income			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Net foreign exchange gain/(loss)			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Interest expense			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Equity in net gain/(loss) of associates			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Other (expense)/income, net			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Income tax expense			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Net income/(loss)			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Reconciliation of Adjusted OIBDA Mobile		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			—				—				—				—				—				—				0.6				(1.3	)			(3.8	)			(8.5	)			(13.2	)			(12.6	)			(8.6	)			(8.1	)			(8.8	)
Depreciation			—				—				—				—				—				—				—				—				—				(0.3	)			(1.5	)			(2.3	)			(2.7	)			(3.1	)			(3.5	)
Amortization			—				—				—				—				—				—				—				—				—				(0.2	)			(0.5	)			(0.3	)			(0.4	)			(0.4	)			(0.2	)
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			—				—				—				—				—				—				0.6				(1.3	)			(3.8	)			(9.0	)			(15.2	)			(15.2	)			(11.7	)			(11.6	)			(12.5	)
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Net foreign exchange gain/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				0.1				—				—
Interest expense			—				—				—				—				—				—				—				—				(0.3	)			(0.7	)			(1.3	)			(1.7	)			(1.8	)			(2.2	)			(2.7	)
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				1.8				3.1				(4.3	)			(6.7	)			(15.8	)			(5.9	)			(7.8	)			(8.4	)
Other (expense)/income, net			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Income tax expense			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Net income/(loss)			—				—				—				—				—				—				0.6				0.5				(1.0	)			(14.0	)			(23.2	)			(32.7	)			(19.3	)			(21.6	)			(23.6	)
Adjusted OIBDA margin mobile as a percentage of net operating revenue			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Depreciation			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Amortization			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Impairment loss			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Operating income margin			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Interest income			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Net foreign exchange gain/(loss)			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Interest expense			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Equity in net gain/(loss) of associates			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Other (expense)/income, net			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Income tax expense			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Net income/(loss) margin			—				—				—				—				—				—				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a				n/a
Reconciliation of Adjusted OIBDA Fixed		Q1 2007				Q2 2007				Q3 2007				Q4 2007				Q1 2008				Q2 2008				Q3 2008				Q4 2008				Q1 2009				Q2 2009				Q3 2009				Q4 2009				Q1 2010				Q2 2010				Q3 2010
Adjusted OIBDA			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Depreciation			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Amortization			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Net foreign exchange gain/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Interest expense			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Other (expense)/income, net			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Income tax expense			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Net income/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Adjusted OIBDA margin fixed as a percentage of net operating revenue			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Depreciation			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Amortization			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Impairment loss			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Operating income margin			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Interest income			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Net foreign exchange gain/(loss)			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Interest expense			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Equity in net gain/(loss) of associates			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Other (expense)/income, net			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Income tax expense			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—
Net income/(loss) margin			—				—				—				—				—				—				—				—				—				—				—				—				—				—				—

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Table of Contents

OJSC VimpelCom Unaudited Condensed Consolidated Balance Sheets

 

		September 30, 2010				December 31, 2009
		(In thousands of US dollars, except share amounts)
Assets
Current assets:
Cash and cash equivalents		$	1,951,960			$	1,446,949
Trade accounts receivable, net of allowance for doubtful accounts			482,071				392,365
Inventory			73,443				61,919
Deferred income taxes			60,634				91,493
Input value added tax			143,054				96,994
Due from related parties			110,517				249,631
Other current assets			329,910				627,257
Total current assets			3,151,589				2,966,608
Property and equipment, net			5,562,015				5,561,569
Telecommunications licenses, net			458,848				542,597
Goodwill			3,493,122				3,284,293
Other intangible assets, net			634,740				700,365
Software, net			415,279				448,255
Investments in associates			445,952				436,767
Other assets			670,496				792,087
Total assets		$	14,832,041			$	14,732,541
Liabilities, redeemable noncontrolling interest and equity
Current liabilities:
Accounts payable		$	696,912			$	545,690
Due to employees			139,608				113,368
Due to related parties			21,156				9,211
Accrued liabilities			253,759				315,666
Taxes payable			266,475				212,767
Customer advances, net of VAT			312,703				376,121
Customer deposits			28,412				28,386
Short-term debt			1,637,265				1,813,141
Total current liabilities			3,356,290				3,414,350
Deferred income taxes			475,855				596,472
Long-term debt			4,360,230				5,539,906
Other non-current liabilities			164,149				164,636
Commitments, contingencies and uncertainties			—				—
Total liabilities			8,356,524				9,715,364
Redeemable noncontrolling interest			518,664				508,668
Equity:
Convertible voting preferred stock (.005 rubles nominal value per share), 10,000,000 shares authorized; 6,426,600 shares issued and outstanding			—				—
Common stock (.005 rubles nominal value per share), 90,000,000 shares authorized; 51,281,022 shares issued (December 31, 2009: 51,281,022); 51,281,022 shares outstanding (December 31, 2009: 50,714,579)			92				92
Additional paid-in capital			1,165,270				1,143,657
Retained earnings			5,243,311				4,074,492
Accumulated other comprehensive loss			(504,716	)			(488,277	)
Treasury stock, at cost, 11,327,200 shares of VimpelCom Ltd. common stock (December 31, 2009: 11,328,860)			(223,406	)			(223,421	)
Total VimpelCom shareholders’ equity			5,680,551				4,506,543
Noncontrolling interest			276,302				1,966
Total equity			5,956,853				4,508,509
Total liabilities, redeemable noncontrolling interest and equity		$	14,832,041			$	14,732,541

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Table of Contents

OJSC VimpelCom Unaudited Condensed Consolidated Statements of Income

 

		Three months ended September 30,								Nine months ended September 30,
		2010				2009				2010				2009
		(In thousands of US dollars)
Operating revenues:
Service revenues		$	2,435,964			$	2,245,967			$	6,979,602			$	6,298,463
Sales of equipment and accessories			33,967				26,130				104,390				86,998
Other revenues			3,254				5,523				11,779				14,694
Total operating revenues			2,473,185				2,277,620				7,095,771				6,400,155
Revenue based tax			—				(1,823	)			—				(5,839	)
Net operating revenues			2,473,185				2,275,797				7,095,771				6,394,316
Operating expenses:
Service costs			561,809				488,425				1,590,661				1,370,952
Cost of equipment and accessories			43,308				26,876				115,637				85,564
Selling, general and administrative expenses			698,751				599,186				2,019,235				1,710,198
Depreciation			351,768				366,039				1,038,208				1,000,201
Amortization			73,330				71,164				206,377				213,947
Provision for doubtful accounts			10,598				12,974				39,769				42,974
Total operating expenses			1,739,564				1,564,664				5,009,887				4,423,836
Operating income			733,621				711,133				2,085,884				1,970,480
Other income and expenses:
Interest income			9,061				7,706				32,534				41,310
Net foreign exchange gain/(loss)			20,413				24,516				(5,170	)			(397,191	)
Interest expense			(120,247	)			(156,793	)			(393,982	)			(434,802	)
Equity in net gain/(loss) of associates			19,201				4,861				26,505				(25,754	)
Other expenses, net			(21,125	)			(3,206	)			(83,535	)			(8,124	)
Total other income and expenses			(92,697	)			(122,916	)			(423,648	)			(824,561	)
Income before income taxes			640,924				588,217				1,662,236				1,145,919
Income tax expense			178,158				152,336				459,729				309,665
Net income			462,766				435,881				1,202,507				836,254
Net income/(loss) attributable to the noncontrolling interest			11,621				1,384				33,688				(2,136	)
Net income attributable to VimpelCom		$	451,145			$	434,497			$	1,168,819			$	838,390

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Table of Contents

OJSC VimpelCom Unaudited Condensed Consolidated Statements of Cash Flows

 

		Nine months ended September 30,
		2010				2009
		(In thousands of US dollars)
Operating activities
Net cash provided by operating activities		$	2,468,278			$	2,761,844
Investing activities
Purchases of property and equipment			(690,928	)			(482,455	)
Purchases of intangible assets			(15,245	)			(13,067	)
Purchases of software			(127,178	)			(128,001	)
Acqusition of Foratek, net of cash acquired			(36,372	)			—
Investments in associates			—				(12,424	)
Payment for shares in Golden Telecom			(143,569	)			—
Cash increase due to Sky Mobile consolidation			4,702				—
Loan granted			(5,305	)			—
Loan receivable repayment			22,910				—
Proceeds from withdrawal of deposits			435,194				—
Purchases of other assets, net			(16,674	)			(29,877	)
Net cash used in investing activities			(572,465	)			(665,824	)
Financing activities
Proceeds from bank and other loans			268,450				1,226,137
Repayments of bank and other loans			(1,589,976	)			(1,691,052	)
Payments of fees in respect of debt issues			(2,606	)			(51,516	)
Net proceeds from employee stock options			27				5,412
Purchase of noncontrolling interest in consolidated subsidiaries			(12,594	)			(439	)
Payment of dividends			(2,049	)			—
Payment of dividends to noncontrolling interest			(34,517	)			(718	)
Net cash used in financing activities			(1,373,265	)			(512,176	)
Effect of exchange rate changes on cash and cash equivalents			(17,537	)			23,788
Net increase in cash and cash equivalents			505,011				1,607,632
Cash and cash equivalents at beginning of period			1,446,949				914,683
Cash and cash equivalents at end of period		$	1,951,960			$	2,522,315
		Nine months ended September 30,
		2010				2009
		(In thousands of US dollars)
Supplemental cash flow information
Cash paid during the period:
Income tax		$	490,468			$	280,774
Interest			379,088				377,568
Non-cash activities:
Accounts payable for property, equipment and other long-lived assets			264,126				128,150