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. Last Updated: 07/27/2016

Sitronics Earnings Drop Despite Booming Sales

High-technology company Sitronics said Monday that net profit fell 11 percent last year to $61.3 million, undershooting consensus forecasts despite a 69 percent rise in revenues.

In a poll, analysts had on average expected Sitronics, part of services conglomerate Sistema, to post 2006 earnings of $80.6 million. Revenues, at $1.61 billion, exceeded a consensus forecast of $1.58 billion.

Earnings before interest, taxation, depreciation and amortization, or EBITDA, before a nonrecurring inventory write-down, rose 19 percent to $183.6 million, roughly in line with the market consensus, the company said in a statement.

Top-line growth was fueled both by organic growth and the acquisition of a 51 percent stake in Intracom Telecom from Greece's Intracom for $151 million in a deal that closed last June.

Sitronics floated earlier this year in London, raising $357 million, but its shares have fallen by 17 percent amid perceptions that the company was overly dependent on orders from other companies in the Sistema group.

The firm said sales to companies not affiliated with the Sistema group rose to 77 percent of total revenues last year from 68 percent one year earlier, and company president Yevgeny Utkin promised further diversification of its client base.

"We made significant progress in the further broadening and diversification of our customer base, while maintaining the integrated nature of our business," Utkin said in a statement.

Sitronics said it expanded into 35 new markets last year, bringing the total in which it operates to 60.

The company runs telecoms, IT and microelectronics business lines, and its recent product additions include wireless access systems, transmission systems, IPTV solutions and smart cards, the company said.