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. Last Updated: 07/27/2016

Vimpelcom Posts 2000 Losses of $78M

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Vimpelcom nearly doubled its losses in 2000, reporting a net loss of $77.8 million after writing off a proportion of its D-AMPS network.

The cellular operator also left the market hungry for news, reporting its fourth-quarter and 2000 financial results Thursday without the hoped-for announcement of an investment into its regional operations.

Chief executive officer Jo Lunder said the company had wanted to announce financials and a transaction simultaneously, but he could only confirm that negotiations were continuing with Alfa Eko, an arm of the powerful Alfa Group, and current shareholders to buy a stake in Vimpelcom-R.

Vimpelcom, which operates on the GSM and D-AMPS networks under the BeeLine brand name, reported a net loss of $77.8 million in 2000, compared with $39.60 million in 1999. The loss was higher than expected because the company had to write off a proportion of its D-AMPS network. Losses were $34.6 million before the write-off.

"The fast pace of Vimpelcom's GSM network expansion and the faster than anticipated rate of migration of its customers from the D-AMPS network to the GSM network resulted in impairment of Vimpelcom's D-AMPS related assets," said a company statement.

"We have evaluated its long-term future and found it appropriate to write down a proportion of its long-term value," Lunder said in a conference call. "Our decision reflects Vimpelcom's successful transaction from D-AMPS to GSM."

Eighty-five percent of new subscribers chose GSM, the company said. The company also passed the 1 million mark, reporting 1.02 million subscribers as of Thursday. Lunder repeated the company's pledge of a return to profitability this year.

Analysts said the numbers were worse than expected.

"Every number was worse than expected. EBITDA, pre-tax and net were all below expectations for fourth quarter," said Anton Inshutin, analyst at Morgan Stanley Dean Witter.

"Even without the write-off, it was below expectations," said Andrei Bogdanov of Alfa Bank.

Total operating revenues rose to $285.67 million from $238.64 million in 1999. EBITDA rose to $51.99 million from $25.73 million for the year. Fourth- quarter EBITDA rose to $13.61 million from negative $5.67 million in fourth quarter 1999.

The company reported a fourth-quarter net loss of $53.43 million, up from $26.29 million in the same period in 1999.