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. Last Updated: 07/27/2016

MTS Shares Surge 6% After Profit Report

Shares in Russia's top cellular operator Mobile TeleSystems jumped on Monday after it said third-quarter net profit rose 25 percent, a result which analysts called proof the mobile market is growing as expected.

Profit jumped to $81.3 million from a revised $64.8 million in the second quarter.

MTS said in a statement it had revised previous profit figures downward in a re-audit, after leaving former auditor Andersen for Deloitte&Touche.

Net revenue rose to $388.5 million in the third quarter from an unchanged $316.3 million and earnings before interest, taxes, depreciation and amortization (EBITDA) rose to $205.9 million from $162 million in the previous quarter, also unchanged.

EBITDA margins rose to a company record of 53 percent from 51 percent the previous quarter.

"Its just a consequence of revenue growth and economies of scale coming through. Their costs are coming up too but they are controlling costs well right now," Vladimir Postolovsky of Citigroup said.

MTS shares rose 6.29 percent to $37.20 after the earnings were announced.

The company is backed by Deutsche Telekom, which owns about 40 percent of MTS.