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Telecoms
Size
Micro Cap
Market Cap £n/a
Enterprise Value £n/a
Revenue £6.56bn
Position in Universe th / 1819

Sistema PJSFC - SISTEMA ANNOUNCES FINANCIAL RESULTS FOR 3Q 2017 - Part 2

Mon 27th November, 2017 7:00am
- Part 2: For the preceding part double click  ID:nRSa5617Xa 

            Nine months ended September 30,  
                                                                                    2017                               2016       
                                                                                                                                  
 CASH FLOWS FROM INVESTING ACTIVITIES:                                                                                            
                                                                                                                                  
 Payments for purchases of property, plant and equipment and investment property    (55,756)                           (56,536)   
 Proceeds from sale of property, plant and equipment                                6,457                              3,229      
 Payments for purchases of intangible assets                                        (14,394)                           (24,735)   
 Payments for businesses, net of cash acquired                                      (3,003)                            (5,432)    
 Payments for investments in associates and joint ventures                          (4,967)                            (2,410)    
 Proceeds from sale of investments in affiliated companies                          3,846                              6,000      
 Payments for purchases of financial assets, long-term                              (21,145)                           (17,673)   
 Proceeds from sale of financial assets, long-term                                  8,501                              5,140      
 Payments for financial assets, short-term                                          (42,796)                           (20,679)   
 Proceeds from disposal of subsidiaries, net of cash disposed                       811                                -          
 Proceeds from sale of financial assets, short-term                                 27,867                             82,784     
 Interest received                                                                  5,857                              8,109      
 Other                                                                              -                                  1,504      
                                                                                                                                  
 NET CASH USED IN INVESTING ACTIVITIES                                              (88,722)                           (20,699)   
                                                                                                                                  
 CASH FLOWS FROM FINANCING ACTIVITIES:                                                                                            
                                                                                                                                  
 Proceeds from borrowings                                                           160,875                            60,063     
 Principal payments on borrowings                                                   (112,810)                          (123,558)  
 Debt issuance costs                                                                (29)                               -          
 Acquisition of non-controlling interests in existing subsidiaries                  (13,350)                           (9,979)    
 Payments to purchase treasury stock                                                (1,601)                            (2,082)    
 Proceeds from capital transactions with non-controlling interests                  13,544                             15,158     
 Dividends paid                                                                     (24,301)                           (21,200)   
 Cash outflow under credit guarantee agreement related to foreign-currency hedge    (1,766)                            (2,032)    
                                                                                                                                  
 NET CASH PROVIDED BY/(USED IN) FINANCING ACTIVITIES                                20,562                             (83,630)   
                                                                                                                                  
 Effect of foreign currency translation on cash and cash equivalents                (7,222)                            (3,456)    
                                                                                                                                  
 Net increase/(decrease) in cash and cash equivalents                               8,681                              (42,342)   
                                                                                                                                  
                                                                                                                                  
 Cash and cash equivalents at the beginning of the period                           60,190                             122,775    
                                                                                                                                  
 Cash and cash equivalents at the end of the period                                 68,871                             80,433     
                                                                                                                                  
 
 
SISTEMA PJSFC AND SUBSIDIARIES 
 
UNAUDITED SEGMENTAL BREAKDOWN FOR THE NINE MONTHS ENDED 30 SEPTEMBER 2017 AND
2016 
 
(Amounts in millions of Russian roubles) 
 
                                 External revenues    Inter-segment revenue    Segment operating income  
                                 9m2017               9m2016                   9m2017                      9m2016    9m2017      9m2016    
                                                                                                                                           
 MTS                             324,288              323,820                  1,799                       280       72,258      65,408    
 Detsky mir                      66,649               54,226                   -                           -         4,342       3,462     
 RTI                             26,062               30,374                   91                          44        (364)       973       
 MTS Bank                        12,175               13,028                   1,186                       903       861         (493)     
 Corporate                       1,374                1,373                    674                         835       (6,210)     (12,317)  
 Total reportable segments       430,548              422,821                  3,750                       2,062     70,887      57,033    
 Other                           79,065               85,156                   1,075                       1,075     1,883       8,800     
                                                                                                                                           
                                 509,613              507,977                  4,825                       3,137     72,770      65,834    
 Inter-segment eliminations                                                                                          164         914       
                                                                                                                                           
 Operating income                                                                                                    72,934      66,747    
 Finance income                                                                                                      5,904       8,235     
 Finance costs                                                                                                       (38,481)    (44,300)  
 Foreign currency exchange gain                                                                                      (123)       7,403     
                                                                                                                                           
 Profit before tax                                                                                                   40,234      38,085    
 
 
                                 Depreciation and amortisation    
 Capital expenditures  
                       9m2017    9m2016                           9m2017    9m2016    
                                                                                      
 MTS                   48,716    60,406                           60,294    61,192    
 Detsky mir            1,242     945                              1,331     1,176     
 RTI                   1,670     2,559                            1,945     1,806     
 MTS Bank              365       186                              418       544       
 Corporate             1,397     1,171                            419       422       
 Other                 16,761    16,004                           8,475     7,228     
                       70,151    81,271                           72,882    72,368    
 
 
Attachment A 
 
Operating Income Before Depreciation and Amortisation (OIBDA) and OIBDA
margin. OIBDA represents operating income before depreciation and
amortisation. OIBDA margin is defined as OIBDA as a percentage of our net
revenues. Our OIBDA may not be similar to OIBDA measures of other companies;
is not a measurement under accounting principles generally accepted under IFRS
and should be considered in addition to, but not as a substitute for, the
information contained in our consolidated statement of profit and loss. We
believe that OIBDA provides useful information to investors because it is an
indicator of the strength and performance of our ongoing business operations,
including our ability to fund discretionary spending such as capital
expenditures, acquisitions of businesses and other investments and our ability
to incur and service debt. While depreciation and amortization are considered
operating costs under IFRS, these expenses primarily represent the non-cash
current period allocation of costs associated with long-lived assets acquired
or constructed in prior periods. OIBDA is commonly used as one of the bases
for investors, analysts and credit rating agencies to evaluate and compare the
periodic and future operating performance and value of companies. 
 
Adjusted OIBDA, operating income and profit attributable to Sistema
shareholders. The Company uses adjusted OIBDA, adjusted operating income and
adjusted profit/(loss) attributable to Sistema shareholders to evaluate
financial performance of the Group. These represent underlying financial
measures adjusted for a number of one-off gains and losses. We believe that
adjusted measures provide investors with additional useful information to
measure our underlying financial performance, particularly from period to
period, because these measures are exclusive of certain one-off gains and
losses. 
 
Adjusted operating income and adjusted OIBDA can be reconciled to our
consolidated statements of profit and loss as follows: 
 
 RUB millions                                           3Q 2017  3Q  2016  9M 2017  9M 2016  
 Operating income                                       29,515   24,937    72,934   66,747   
 Impairment of long-lived assets in Turkmenistan (MTS)  1,146              1,146             
 Impairment of financial assets                                  4,634              4,634    
 Gain on acquisitions at Agroholding Steppe                                         -1,175   
 Gain on a penalty payment by a counterparty (Medsi)             -221               -221     
 Gain on investments at Medsi                                              -785              
 Impairment of goodwill (subsidiary of Segezha Group)                               241      
 Accruals related to LTI program at Detsky Mir          359                700               
 Impairment of inventory                                                   1,604             
 Adjusted operating income                              31,020   29,350    75,599   70,226   
 Depreciation and amortisation                          24,606   25,398    72,882   72,368   
 Adjusted OIBDA                                         55,626   54,748    148,481  142,594  
 
 
Adjusted profit attributable to Sistema shareholders can be reconciled to our
consolidated statements of profit and loss as follows: 
 
 RUB millions                                           3Q 2017  3Q  2016  9M 2017  9M 2016  
 Profit attributable to Sistema                         4,451    1,120     4,288    4,186    
 Impairment of long-lived assets in Turkmenistan (MTS)  573                573               
 Gain on acquisitions at Agroholding Steppe                                         -1,175   
 Impairment of financial assets                                  4,634              4,634    
 Gain on a penalty payment by a counterparty (Medsi)             -221               -221     
 Gain on investments at Medsi                                              -785              
 Impairment of goodwill (subsidiary of Segezha Group)                               241      
 Accruals related to LTI program at Detsky Mir          149                315               
 Impairment of inventory                                                   1,283             
 Adjusted profit attributable to Sistema                5,173    5,533     5,674    7,665    
 
 
7,665 
 
Net debt at the Corporate Centre level. We define net debt as indebtedness
less cash, cash equivalents and other liquid deposits and financial
instruments. The indebtedness is defined as long-term debt, including its
current portion, and short-term debt. We believe that the presentation of net
debt at the Corporate Centre level provides useful information to investors
because we use this measure in our management of the Corporate Centre's
liquidity, financial flexibility, capital structure and leverage. Net debt at
the Corporate Centre level can be reconciled to the indebtedness of our
Corporate segment as follows: 
 
 RUB millions                               3Q 2017   3Q  2016  
 Indebtedness of the Corporate segment      119,892   99,267    
 Cash and cash equivalents                  (15,731)  (8,598)   
 Liquid deposits and financial instruments  (4,703)   (10,088)  
 Net debt at the Corporate Centre level     99,458    80,581    
 
 
 1  See Attachment A for definitions and reconciliation of adjusted OIBDA and
adjusted profit attributable to Sistema to IFRS financial measures. 
 
 2  Including highly liquid deposits and liquid financial investments, based
on management accounts. See Attachment A for reconciliation to IFRS financial
measures. 
 
 3  Net of applicable taxes 
 
 4 Here and from hereon, revenues are presented on an aggregated basis,
excluding revenues from intra-segment (between entities in the same segment)
transactions, but before inter-segment (between entities in different
segments) eliminations, unless accompanied by the word "consolidated". Amounts
attributable to individual companies, where appropriate, are shown prior to
both intra-segment and inter-segment eliminations and may differ from
respective standalone results due to certain reclassifications and
adjustments. 
 
 5 Including share in results of MTS Bank 
 
 6  Results have been adjusted for additional accruals under the LTI program
(including related tax effects). 
 
 7 Excluding D&A expenses, as well as share-based compensation and cash
bonuses under the LTI program 
 
 8 Excluding results of East-West United Bank (EWUB) and the result of the
divestment of a 47% stake in EWUB 
 
 9  In this table Leader Invest results for 3Q 2017 and 9M 2017are presented
in accordance with IFRS 15. 3Q 2016 and 9M 2016 results are presented in
accordance with IAS 18. 
 
This information is provided by RNS
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