Rostelecom reports combined and consolidated ifrs financial results for the first quarter of 2011

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Moscow – June 30, 2011 – Rostelecom OJSC (the “Group”) (MICEX: RTKM, RTKM-002D - RTKM-017D, RTKMP; RTS: RTKM, RTKMP; OTCQX: ROSYY), Russia’s national telecommunications operator, today announced its unaudited combined and consolidated*  IFRS financial results for the three months ended March 31, 2011.

FINANCIAL HIGHLIGHTS 
Combined and consolidated revenues up 8% year on year to RUB 72.4 billion 
OIBDA**  of RUB 27.2 billion and OIBDA margin of 37.6% 
Net income up 6% year on year to RUB 10.6 billion 
Capital expenditure***  of RUB 15.1 billion represents 20.9% of combined revenues
Net debt****  of RUB 154.4 billion as at March 31, 2011, with net debt to annualized OIBDA 
ratio of 1.5x 

OPERATING HIGHLIGHTS 
Total local telephony subscriber base stable quarter-on-quarter and slightly down year on year to 29.2 million
Total broadband internet subscriber base up 33% year on year to 7.4 million 
Total Pay-TV subscriber base up seven-fold year on year to 5.5 million 




* Combination of consolidated financial statements of North-West Telecom OJSC, CenterTelecom OJSC, Southern Telecommunications Company OJSC, VolgaTelecom OJSC, Uralsvyazinform OJSC, Sibirtelecom OJSC, Far East Telecom OJSC (“RTOs”), Dagsvyazinform OJSC and Rostelecom OJSC, which had been under common control of Svyazinvest OJSC and were merged on April 1, 2011.
** Here and below, please refer to Attachment 1 to this statement for a full definition and reconciliation of OIBDA 
*** Here and below, capital expenditure (“CAPEX”) comprises cash spent on purchase of property, plant and equipment and intangible assets
**** Here and below, Net debt is calculated as the sum of long-term loans and short-term borrowings minus cash and cash equivalents and short-term investments