VimpelCom Chief Lunder Searches for Partnerships to Reduce Burden of Debt
VimpelCom Ltd. (VIP), Russia’s third- largest wireless company by subscribers, is seeking partnerships in its markets to rein in capital expenditure and improve the ratio of debt to profit.
Mar 14, 2012
The company reported a fourth-quarter net loss of $386 million, compared with profit of $461 million a year earlier, and targeted "mid-single digit" revenue growth through 2014. Operations in Vietnam and Cambodia had impairment charges of $527 million, Amsterdam-based VimpelCom said in a statement today. The company added debt to buy Wind Telecom SpA last year.
The margin for earnings before interest, taxes, depreciation and amortization in Russia, the largest unit, narrowed to 39.4 percent of sales from 46.4 percent as the company invested in networks to draw new customers. Moves such as tower sharing, outsourcing and consolidation within markets will help the company to cut capital spending and improve profitability, Chief Executive Officer Jo Lunder said.
"You will see this happening with VimpelCom in the next two to three years as part of the initiative to reduce capex," Lunder said in an interview today. "We have opportunities in Russia, Asia and Italy. There are ongoing discussions."
The company is also considering tower sharing in Pakistan, Lunder said. He targets capital expenditure of less than 15 percent of sales by 2014, compared with 21 percent in 2011.
Vimpelcom is the world’s sixth-largest wireless operator by subscribers, and more than 70 percent of its subscribers are outside of Russia.
Source URL: http://www.bloomberg.com/news/2012-03-13/vimpelcom-forecasts-mid-single-digit-revenue-growth.html
The margin for earnings before interest, taxes, depreciation and amortization in Russia, the largest unit, narrowed to 39.4 percent of sales from 46.4 percent as the company invested in networks to draw new customers. Moves such as tower sharing, outsourcing and consolidation within markets will help the company to cut capital spending and improve profitability, Chief Executive Officer Jo Lunder said.
"You will see this happening with VimpelCom in the next two to three years as part of the initiative to reduce capex," Lunder said in an interview today. "We have opportunities in Russia, Asia and Italy. There are ongoing discussions."
The company is also considering tower sharing in Pakistan, Lunder said. He targets capital expenditure of less than 15 percent of sales by 2014, compared with 21 percent in 2011.
Vimpelcom is the world’s sixth-largest wireless operator by subscribers, and more than 70 percent of its subscribers are outside of Russia.
Source URL: http://www.bloomberg.com/news/2012-03-13/vimpelcom-forecasts-mid-single-digit-revenue-growth.html