Beeline AR 2005 - VimpelCom

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Consolidated Statements of Income 76 VimpelCom Consolidated Statements of Shareholders' Equity ВымпелКом Annual Report 2005 and Accumulated Other Comprehensive Income Годовой отчет 2005 77 Consolidated Statements of Income 2005 Years ended December 31, 2004 2003 Operating revenues: (In thousands of US dollars, except per share (ADS) amounts) Service revenues $ 3,175,221 $ 2,070,720 $ 1,269,927 Sales of handsets and accessories 30,478 38,711 55,765 Other revenues 5,419 3,571 3,961 Total operating revenues 3,211,118 2,113,002 1,329,653 Operating expenses: Service costs 514,124 327,403 203,093 Cost of handsets and accessories 28,294 30,585 36,447 Selling, general and administrative expenses 1,085,807 720,127 467,655 Depreciation 451,152 281,129 162,769 Amortization 142,126 64,072 34,064 Impairment of long-lived assets (Note 10) - 7,354 – Provision for doubtful accounts 11,583 8,166 9,228 Total operating expenses 2,233,086 1,438,836 913,256 Operating income 978,032 674,166 416,397 Other income and expenses: Interest income 8,658 5,712 8,378 Other income 18,647 7,412 6,296 Net foreign exchange gain (loss) 7,041 3,563 (1,279) Interest expense (147,448) (85,663) (68,246) Other expenses (24,500) (19,565) (3,251) Total other income and expenses (137,602) (88,541) (58,102) Income before income taxes, minority interest and cumulative effect of change in accounting principle 840,430 585,625 358,295 Income tax expense (Note 18) 221,901 155,000 105,879 Minority interest in earnings (losses) of subsidiaries, before cumulative effect of change in accounting principle 3,398 80,229 23,280 Income before cumulative effect of change in accounting principle 615,131 350,396 229,136 Cumulative effect of change in accounting principle, net of tax (for the year ended December 31, 2003: US$120) (Note 2) – – (379) Minority interest in cumulative effect of change in accounting principle – – 52 Net income $ 615,131 $ 350,396 $ 228,809 Basic EPS: Income before cumulative effect of change in accounting principle $ 12.05 $ 8.50 $ 5.99 Net income per common share 12.05 8.50 5.98 Weighted average common shares outstanding 51,066 41,224 38,241 Income before cumulative effect of change in accounting principle per ADS equivalent $ 3.01 $ 2.13 $ 1.50 Net income per ADS equivalent 3.01 2.13 1.50 Diluted EPS (as amended): Income before cumulative effect of change in accounting principle $ 12.04 $ 8.49 $ 5.67 Net income per common share 12.04 8.49 5.67 Weighted average diluted shares (as amended) (Note 21) 51,085 41,272 40,344 Income before cumulative effect of change in accounting principle per ADS equivalent $ 3.01 $ 2.12 $ 1.42 Net income per ADS equivalent 3.01 2.12 1.42 The accompanying notes are an integral part of these consolidated financial statements. Consolidated Statements of Shareholders' Equity and Accumulated Other Comprehensive Income Years ended December 31, 2005, 2004 and 2003 Additional Accumulated Other Common Stock Paid-in Retained Comprehensive Treasury Shares Amount Capital Earnings Income Stock Total (In thousands of US dollars, except shares) Balances at December 31, 2002 40,332,201 $ 90 $ 528,914 $ 189,888 – $ (61,641) $ 657,251 Gain from issuance of subsidiary stock (Note 16) – – 4,947 – – – 4,947 Sale of treasury stock – 69,469 shares – – 3,350 – – 1,379 4,729 Conversion of Senior convertible notes – 2,053,174 shares – – 32,617 – – 56,832 89,449 Comprehensive income: Foreign currency translation adjustment (Note 2) – – – – 2,466 – 2,466 Net income – – – 228,809 – – 228,809 Total accumulated comprehensive income – – – 228,809 2,466 – 231,275 Balances at December 31, 2003 40,332,201 90 569,828 418,697 2,466 (3,430) 987,651 Sale of treasury stock – 9,392 shares – – 1,355 – – 188 1,543 Issuance of common stock to Eco Telecom and Telenor under the Merger Agreement dated October 24, 2003 (Note 5) 10,948,821 2 794,795 – – – 794,797 Comprehensive income: Foreign currency translation adjustment (Note 2) – – – – 22,746 – 22,746 Net income – – – 350,396 – – 350,396 Total accumulated comprehensive income – – – 350,396 22,746 – 373,142 Balances at December 31, 2004 51,281,022 $ 92 $ 1,365,978 $ 769,093 $ 25,212 $ (3,242) $ 2,157,133 Continued on the next page
Consolidated Statements of Shareholders' Equity 78 and Accumulated Other Comprehensive Income VimpelCom Consolidated Statements of Cash Flows ВымпелКом Annual Report 2005 Годовой отчет 2005 79 Consolidated Statements of Shareholders' Equity and Accumulated Other Comprehensive Income (continued) Years ended December 31, 2005, 2004 and 2003 Additional Accumulated Other Common Stock Paid-in Retained Comprehensive Treasury Shares Amount Capital Earnings Income Stock Total (In thousands of US dollars, except shares) Sale of treasury stock – 33,048 shares – $ – $ 4,676 $ – $ – $ 659 $ 5,335 Purchase of treasury stock – 135,508 shares – – – – – (18,374) (18,374) Comprehensive income: Foreign currency translation adjustment (Note 2) – – – – (18,676) – (18,676) Net income – – – 615,131 – – 615,131 Total accumulated comprehensive income – – – 615,131 (18,676) – 596,455 Balances at December 31, 2005 51,281,022 $ 92 $ 1,370,654 $ 1,384,224 $ 6,536 $ (20,957) $ 2,740,549 The accompanying notes are an integral part of these consolidated financial statements. Consolidated Statements of Cash Flows 2005 Years ended December 31, 2004 (In thousands of US dollars) 2003 Operating activities Net income Adjustments to reconcile net income to net cash provided by operating activities: $ 615,131 $ 350,396 $ 228,809 Depreciation 451,152 281,129 162,769 Amortization 142,126 64,072 34,064 Impairment of long-lived assets – 7,354 – Mark-to-market adjustments for short-term investments – – – Provision for deferred taxes 4,582 286 (14,330) (Gain) loss on foreign currency translation (7,041) (3,563) 1,279 Provision for doubtful accounts 11,583 8,166 9,228 Minority interest in earnings (losses) of subsidiaries 3,398 80,229 23,280 Other adjustments 3,370 – – Cumulative effect of change in accounting principle Changes in operating assets and liabilities: – – 379 Trade accounts receivable (32,734) (19,507) (41,781) Inventory (22,010) (18,646) (2,069) Input value added tax 3,921 (24,559) (77,258) Other current assets (8,428) (6,941) (694) Due from related parties 453 637 1,732 Due to related parties (6,581) (1,322) 3,004 Accounts payable 53,950 43,183 26,998 Customer advances and deposits 37,805 89,852 73,502 Deferred revenue (679) (671) (957) Taxes payable and accrued liabilities 48,211 (44,688) 83,922 Net cash provided by operating activities 1,298,209 805,407 511,877 Investing activities Purchases of property and equipment (1,178,470) (925,133) (506,716) Purchases of intangible assets (16,453) (18,169) (18,654) Proceeds from sale of property and equipment 52,578 – 12,433 Purchase of StavTeleSot stock, net of cash acquired of US$658 – – (42,455) Purchase of DTI stock, net of cash acquired of US$382 – (73,689) – Purchase of KaR-Tel stock, net of cash acquired of US$7,556 – (344,414) – Purchase of STM, net of cash acquired US$6,835 (48,382) – – Purchase of ST (5,040) – – Sale of ST 4,968 – – Purchase of URS, net of cash acquired $625 (235,044) – – Purchase of Tacom, net of cash acquired $35 (11,065) – – Purchase of minority interest in consolidated subsidiaries (8,534) (12,884) – Sale of minority in Kar-Tel 175,000 – – Purchases of other assets (320,423) (142,964) (38,561) Net cash used in investing activities $ (1,590,865) $ (1,517,253) $ (593,953) Continued on the next page
Page 1 and 2: VimpelCom Annual Report Годов
Page 3 and 4: 1996 The Russian flag flying on Wal
Page 5 and 6: 1997 Sheremetyevo Airport makes a
Page 7 and 8: 1998 The financial crisis of August
Page 9 and 10: 14 VimpelCom ВымпелКом Ann
Page 21 and 22: The Legacy of VimpelCom Founders’
Page 23 and 24: 42 VimpelCom Annual Report 2005 Cor
Page 25 and 26: Selected Consolidated Financial Dat
Page 27 and 28: Management’s Discussion and Analy
Page 37 and 38: 70 VimpelCom Annual Report 2005 Thi
Page 39: 74 VimpelCom Annual Report 2005 Rep
Page 43 and 44: Notes to Consolidated Financial Sta

Beeline AR 2005 - VimpelCom

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