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Press Releases Media Relations Team Corporate Photo Library	10.06.2008 SUMMARY UNAUDITED FINANCIAL RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2008 MOSCOW, Russia - June 10, 2008 - JSC SITRONICS ("Sitronics" or the "Group") (LSE: SITR), a leading provider of telecommunications, information technology and microelectronic solutions in Russia and the CIS, with a growing presence in other EEMEA emerging markets, today announced its summary unaudited consolidated US GAAP financial results for the first quarter ended March 31, 2008. FIRST QUARTER HIGHLIGHTS • Consolidated revenues up 43.8% year on year to US$ 445.8 million • Telecommunications Solutions segment revenues up 36.9% year on year to US$ 155.3 million • Information Technology Solutions segment revenues up 38.1% year on year to US$ 200.1 million • Microelectronic Solutions segment revenues up 87.1% year on year to US$ 69.8 million • OIBDA more than tripled quarter on quarter to US$ 20.6 million, compared to OIBDA loss of US$ 11.4 million in the first quarter of 2007 • Total assets increased by 8.8 % year on year to US$ 2.2 billion at the end of the first quarter of 2008 (US$ 2.0 billion in first quarter of 2007) • Net loss of US$ 8.2 million compared to net loss of US$ 46.1 million in the fourth quarter of 2007 and net loss of US$ 28.0 million in the first quarter of 2007 Sergey Aslanian, President of SITRONICS, commented: "We have over delivered on our promises made during the full year results announcement in April as all our segments showed positive OBIDA in the first quarter. The first quarter saw significant growth in revenue and OIBDA compared to the previous year. The considerable improvement in SITRONICS' quarterly results reflects the continued progress of the business restructuring led by the new management team as well as the associated measures implemented to improve business efficiency following the launch of the new strategy ‘Crystal' during the quarter. The net loss decreased substantially both year on year and quarter on quarter, and it is expected that this trend will continue with the OIBDA margin forecast to be at least 5% for the whole year. Already with an OIBDA margin of 4.6% in the first quarter we are well on course to meet this target. In fact, all key business indicators, including revenues and OIBDA, have increased year on year. In the first quarter, SITRONICS continued to reorganize and optimize its business segments thereby increasing its sales capacity and leveraging cross and up-sell opportunities. We intend to drive further growth in the business segments, reducing costs and improving operating profitability throughout the Group." FINANCIAL SUMMARY (US$ millions) Q1 2008 Q1 2007 Year on Year Change Revenues 445.8 310.0 43.8% OIBDA 20.6 (11.4) - Net loss (8.2) (28.0) - OPERATING REVIEW Group Overview SITRONICS generated a 43.8% year on year increase in consolidated revenues in the first quarter of 2008 as a result of the continued growth in the business. Between the announcement date of full year 2007 results on April 29, 2008 and today the Company won nearly US$ 31.3 million of new business, which will be implemented from 2008 onwards. SITRONICS continues to expand its existing product range across its business segments, implementing strategies that specifically target fast-growing product segments where the Group can achieve the highest margins. SITRONICS' OIBDA has tripled quarter on quarter to US$ 20.6 million with OIBDA margin of 4.6% in the first quarter of 2008 compared to US$ 6.4 million in the fourth quarter of 2007 and OIBDA margin of 1.1%, and was negatively impacted by US$ 3.3 million of non-cash costs arising from the Company's previously announced stock option programme. The first stock awards under this scheme were made in July 2007. SITRONICS reported net losses of US$ 8.2 million for the first quarter compared to a net loss of US$ 28.0 million in the first quarter of 2007 and a net loss of US$ 46.1 million in the fourth quarter of 2007. SEGMENTAL REVIEW Telecommunication Solutions (US$ millions) Q1 2008 Q1 2007 Year on Year Change Revenues 155.3 113.4 36.9% OIBDA 6.0 (11.8) - Total Assets 1,061.4 977.3 8.6% The Telecommunications Solutions segment's revenues showed a significant increase year on year of 36.9% in the first quarter illustrating a strong performance in the market on the back of new contract wins and optimization of the business. The segment continued to show improvement in OIBDA generating US$ 6.0 million in the first quarter compared to an OIBDA loss of US$ 11.8 million in the first quarter of 2007 and a loss of US$ 9.2 million in the fourth quarter of 2007. The segment is expected to demonstrate significant progress in its performance throughout 2008. Between the announcement date of full year 2007 results on April 29, 2008 and today the Telecommunications Solutions segment signed US$ 16.7 million of new business, which will be implemented from 2008 onwards, including contracts for 6 new WiBAS Point-to-Multipoint deployments in Europe and the CIS. Within the framework of these agreements SITRONICS will provide backhaul systems for broadband corporate wireless access services for six large operators in Europe and the CIS, including T-Mobile in Slovakia, Globul in Bulgaria, Smart Telecom in Ireland, MTS in Russia, Kazakhtelecom in Kazakhstan and Mediacom in Poland. SITRONICS Telecom Solutions also signed a US$ 5.7 million contract with Shyam Telelink to supply, install and commission INTRALINK Point-to-Point Radio Link network for the cellular operator's expansion in the Rajasthan region. The completion of this project is anticipated in the next several months. In addition, SITRONICS is currently participating in the tender process with Shyam Telelink to provide network equipment for the entire pan-Indian territory on a turnkey basis, including hardware, software and associated services. Information Technology Solutions (US$ millions) Q1 2008 Q1 2007 Year on Year change Revenues 200.1 144.9 38.1% OIBDA 5.5 1.1 400% Total Assets 344. 4 186.3 84.9% SITRONICS' Information Technology Solutions segment performed in line with expectations in the first quarter, and reported substantially higher revenues year on year, recording 38.1% growth. The segment OIBDA has significantly increased year on year, whilst the OIBDA margin expanded to 2.7% in comparison with the nearly breakeven result in the first quarter of 2007 due to the contribution of the system integration business. The segment is expected to continue performing strongly in 2008. Between the announcement date of full year 2007 results on April 29, 2008 and today the Information Technology Solutions segment signed US$ 14.5 million of new business, mainly in Russia and Ukraine. Microelectronic Solutions (US$ millions) Q1 2008 Q1 2007 Year on Year change Revenues 69. 8 37.3 87.1% OIBDA 11. 4 6.8 67.6% Total Assets 545.4 226.2 141.1 % SITRONICS' Microelectronics Solutions segment continued to deliver strong results in the first quarter, and reported 87.1% growth in revenues year on year. The segment's OIBDA grew by 67.6% year on year, whilst the OIBDA margin slightly decreased to 15.2% as a result of a substantial increase in sales of SITRONICS' Smart Technologies division which has lower margins compared to other products manufactured by the segment. In June 2008, SITRONICS implemented the ISO 14000 Environment Management Standards, which enable the Company to identify and control the environmental impact of its activities. SITRONICS is the first microelectronics company in Russia to adopt ISO 14000 standard. Consumer Services and Products (US$ millions) Q1 2008 Q1 2007 Year on Year Change Revenues 20.6 14.4 43.1% OIBDA 4.5 (2.6) - Total Assets 118.1 182.0 (35.1%) The Consumer Services and Products segment reported a 43.1% growth in revenue and a significant improvement in OIBDA year on year. The OIBDA margin increased to 21.8% as a result of assets optimization and reorganization programmes. The segment continues to restructure its operations to meet current market conditions. Outlook The Company reiterates its previously stated outlook for revenue growth in excess of forecasted market growth of 15% and OIBDA margin of at least 5% for the full year 2008. The Information Technology Solutions and Microelectronics Solutions segments are expected to continue to perform strongly in 2008, while the Telecommunications Solutions segment is also anticipated to show significant improvements throughout 2008. OTHER INFORMATION Conference call SITRONICS management will host a conference call today at 4.30 PM Moscow local time, 1.30 PM London local time and 8.30 AM New York local time to present and discuss these results. Participants may dial the following numbers in order to access the call: UK / International: +44 (0) 20 8609 0582 US: +1 866 928 1925 A replay facility will also be made available for 7 days after the call and may be accessed by dialing the following numbers and using the following pin code: UK / International: +44 (0) 20 8609 0289 US: +1 866 676 5865 PIN CODE: 219433 # *** For further information, please visit www.sitronics.com or contact: Corporate Communications Irina Lanina Vice President Tel: +7 495 225 0030 lanina@sitronics.com Shared Value Limited Larisa Kogut-Millings Investor Relations Tel: +44 (0) 20 7321 5037 sitronics@sharedvalue.net ABOUT SITRONICS SITRONICS (LSE: SITR) is a leading provider of telecommunication solutions, including software, equipment and systems integration, IT solutions and microelectronic solutions in Russia and the Commonwealth of Independent States, with a strong presence in Central and Eastern Europe and a growing presence in the Middle East and Africa. SITRONICS serves over 3,500 clients, maintains offices in 32 countries and exports its products and services to more than 60 countries. SITRONICS has over 10,000 employees. SITRONICS' key Telecommunication Solutions operations are based in Prague (Czech Republic), Athens (Greece) and Moscow (Russia), while the company's IT Solutions and Microelectronic Solutions divisions are based in Kiev (Ukraine) and Zelenograd (Russia) respectively. SITRONICS is majority-owned by Sistema (61.3%), which is the largest diversified holding company in Russia and the CIS. SITRONICS' shares are listed under the symbol "SITR" on the London Stock Exchange, the Russian Trading System (RTS), and the Moscow Stock Exchange (MSE). SITRONICS has developed strategic alliances in its home markets with Cisco Systems, STMicroelectronics, Infineon and Giesecke & Devrient, in relation to certain products and services. SITRONICS has vendor relationships with Siemens, Ericsson, Motorola, ORACLE, Intel, Sun Microsystems and Microsoft. Key customers include Sistema group companies such as MTS, Comstar UTS and MTT, as well as OTE, Cosmote, Vodafone, Ericsson and TCL. Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of SITRONICS. You can identify forward-looking statements by terms such as "expect," "believe," "anticipate," "estimate," "intend," "will," "could," "may" or "might" the negative of such terms or other expressions. These statements are only predictions and actual events or results may differ materially. We do not intend to or undertake any obligation to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, general economic conditions, our competitive environment, risks associated with operating in Russia, rapid technological and market change in our industries, and other factors specifically related to SITRONICS and its operations. Back to «Press Releases»

Press Releases

Press Releases Media Relations Team Corporate Photo Library

10.06.2008 SUMMARY UNAUDITED FINANCIAL RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2008

MOSCOW, Russia - June 10, 2008 - JSC SITRONICS ("Sitronics" or the "Group") (LSE: SITR), a leading provider of telecommunications, information technology and microelectronic solutions in Russia and the CIS, with a growing presence in other EEMEA emerging markets, today announced its summary unaudited consolidated US GAAP financial results for the first quarter ended March 31, 2008.

FIRST QUARTER HIGHLIGHTS

• Consolidated revenues up 43.8% year on year to US$ 445.8 million
• Telecommunications Solutions segment revenues up 36.9% year on year to US$ 155.3 million
• Information Technology Solutions segment revenues up 38.1% year on year to US$ 200.1 million
• Microelectronic Solutions segment revenues up 87.1% year on year to US$ 69.8 million
• OIBDA more than tripled quarter on quarter to US$ 20.6 million, compared to OIBDA loss of US$ 11.4 million in the first quarter of 2007
• Total assets increased by 8.8 % year on year to US$ 2.2 billion at the end of the first quarter of 2008 (US$ 2.0 billion in first quarter of 2007)
• Net loss of US$ 8.2 million compared to net loss of US$ 46.1 million in the fourth quarter of 2007 and net loss of US$ 28.0 million in the first quarter of 2007

Sergey Aslanian, President of SITRONICS, commented: "We have over delivered on our promises made during the full year results announcement in April as all our segments showed positive OBIDA in the first quarter.

The first quarter saw significant growth in revenue and OIBDA compared to the previous year. The considerable improvement in SITRONICS' quarterly results reflects the continued progress of the business restructuring led by the new management team as well as the associated measures implemented to improve business efficiency following the launch of the new strategy ‘Crystal' during the quarter. The net loss decreased substantially both year on year and quarter on quarter, and it is expected that this trend will continue with the OIBDA margin forecast to be at least 5% for the whole year. Already with an OIBDA margin of 4.6% in the first quarter we are well on course to meet this target. In fact, all key business indicators, including revenues and OIBDA, have increased year on year.

In the first quarter, SITRONICS continued to reorganize and optimize its business segments thereby increasing its sales capacity and leveraging cross and up-sell opportunities. We intend to drive further growth in the business segments, reducing costs and improving operating profitability throughout the Group."

FINANCIAL SUMMARY

(US$ millions) Q1 2008 Q1 2007 Year on Year Change

Revenues                          445.8                310.0                            43.8%
OIBDA                                 20.6                (11.4)                                  -
Net loss                              (8.2)               (28.0)                                   -

OPERATING REVIEW

Group Overview

SITRONICS generated a 43.8% year on year increase in consolidated revenues in the first quarter of 2008 as a result of the continued growth in the business. Between the announcement date of full year 2007 results on April 29, 2008 and today the Company won nearly US$ 31.3 million of new business, which will be implemented from 2008 onwards.

SITRONICS continues to expand its existing product range across its business segments, implementing strategies that specifically target fast-growing product segments where the Group can achieve the highest margins.

SITRONICS' OIBDA has tripled quarter on quarter to US$ 20.6 million with OIBDA margin of 4.6% in the first quarter of 2008 compared to US$ 6.4 million in the fourth quarter of 2007 and OIBDA margin of 1.1%, and was negatively impacted by US$ 3.3 million of non-cash costs arising from the Company's previously announced stock option programme. The first stock awards under this scheme were made in July 2007.

SITRONICS reported net losses of US$ 8.2 million for the first quarter compared to a net loss of US$ 28.0 million in the first quarter of 2007 and a net loss of US$ 46.1 million in the fourth quarter of 2007.
SEGMENTAL REVIEW

Telecommunication Solutions

(US$ millions)               Q1 2008          Q1 2007              Year on Year Change
Revenues                       155.3              113.4                         36.9%
OIBDA                                6.0              (11.8)                              -
Total Assets                 1,061.4              977.3                          8.6%

The Telecommunications Solutions segment's revenues showed a significant increase year on year of 36.9% in the first quarter illustrating a strong performance in the market on the back of new contract wins and optimization of the business. The segment continued to show improvement in OIBDA generating US$ 6.0 million in the first quarter compared to an OIBDA loss of US$ 11.8 million in the first quarter of 2007 and a loss of US$ 9.2 million in the fourth quarter of 2007. The segment is expected to demonstrate significant progress in its performance throughout 2008.

Between the announcement date of full year 2007 results on April 29, 2008 and today the Telecommunications Solutions segment signed US$ 16.7 million of new business, which will be implemented from 2008 onwards, including contracts for 6 new WiBAS Point-to-Multipoint deployments in Europe and the CIS. Within the framework of these agreements SITRONICS will provide backhaul systems for broadband corporate wireless access services for six large operators in Europe and the CIS, including T-Mobile in Slovakia, Globul in Bulgaria, Smart Telecom in Ireland, MTS in Russia, Kazakhtelecom in Kazakhstan and Mediacom in Poland.

SITRONICS Telecom Solutions also signed a US$ 5.7 million contract with Shyam Telelink to supply, install and commission INTRALINK Point-to-Point Radio Link network for the cellular operator's expansion in the Rajasthan region. The completion of this project is anticipated in the next several months. In addition, SITRONICS is currently participating in the tender process with Shyam Telelink to provide network equipment for the entire pan-Indian territory on a turnkey basis, including hardware, software and associated services.

Information Technology Solutions

(US$ millions)                   Q1 2008         Q1 2007            Year on Year change
Revenues                          200.1             144.9                      38.1%
OIBDA                                  5.5                 1.1                          400%
Total Assets                      344. 4             186.3                      84.9%

SITRONICS' Information Technology Solutions segment performed in line with expectations in the first quarter, and reported substantially higher revenues year on year, recording 38.1% growth. The segment OIBDA has significantly increased year on year, whilst the OIBDA margin expanded to 2.7% in comparison with the nearly breakeven result in the first quarter of 2007 due to the contribution of the system integration business. The segment is expected to continue performing strongly in 2008.

Between the announcement date of full year 2007 results on April 29, 2008 and today the Information Technology Solutions segment signed US$ 14.5 million of new business, mainly in Russia and Ukraine.

Microelectronic Solutions

(US$ millions)              Q1 2008         Q1 2007               Year on Year change
Revenues                      69. 8                37.3                          87.1%
OIBDA                            11. 4                  6.8                           67.6%
Total Assets                   545.4               226.2                       141.1 %

SITRONICS' Microelectronics Solutions segment continued to deliver strong results in the first quarter, and reported 87.1% growth in revenues year on year. The segment's OIBDA grew by 67.6% year on year, whilst the OIBDA margin slightly decreased to 15.2% as a result of a substantial increase in sales of SITRONICS' Smart Technologies division which has lower margins compared to other products manufactured by the segment.

In June 2008, SITRONICS implemented the ISO 14000 Environment Management Standards, which enable the Company to identify and control the environmental impact of its activities. SITRONICS is the first microelectronics company in Russia to adopt ISO 14000 standard.

Consumer Services and Products

(US$ millions)                   Q1 2008            Q1 2007            Year on Year Change
Revenues                          20.6                   14.4                         43.1%
OIBDA                                 4.5                    (2.6)                               -
Total Assets                     118.1                  182.0                       (35.1%)

The Consumer Services and Products segment reported a 43.1% growth in revenue and a significant improvement in OIBDA year on year. The OIBDA margin increased to 21.8% as a result of assets optimization and reorganization programmes. The segment continues to restructure its operations to meet current market conditions.

Outlook

The Company reiterates its previously stated outlook for revenue growth in excess of forecasted market growth of 15% and OIBDA margin of at least 5% for the full year 2008. The Information Technology Solutions and Microelectronics Solutions segments are expected to continue to perform strongly in 2008, while the Telecommunications Solutions segment is also anticipated to show significant improvements throughout 2008.

OTHER INFORMATION

Conference call
SITRONICS management will host a conference call today at 4.30 PM Moscow local time, 1.30 PM London local time and 8.30 AM New York local time to present and discuss these results. Participants may dial the following numbers in order to access the call:
UK / International: +44 (0) 20 8609 0582
US: +1 866 928 1925

A replay facility will also be made available for 7 days after the call and may be accessed by dialing the following numbers and using the following pin code:

UK / International: +44 (0) 20 8609 0289

US: +1 866 676 5865
PIN CODE: 219433 #

***

For further information, please visit www.sitronics.com or contact:

Corporate Communications
Irina Lanina
Vice President
Tel: +7 495 225 0030
lanina@sitronics.com Shared Value Limited
Larisa Kogut-Millings
Investor Relations
Tel: +44 (0) 20 7321 5037
sitronics@sharedvalue.net

ABOUT SITRONICS

SITRONICS (LSE: SITR) is a leading provider of telecommunication solutions, including software, equipment and systems integration, IT solutions and microelectronic solutions in Russia and the Commonwealth of Independent States, with a strong presence in Central and Eastern Europe and a growing presence in the Middle East and Africa.

SITRONICS serves over 3,500 clients, maintains offices in 32 countries and exports its products and services to more than 60 countries. SITRONICS has over 10,000 employees.

SITRONICS' key Telecommunication Solutions operations are based in Prague (Czech Republic), Athens (Greece) and Moscow (Russia), while the company's IT Solutions and Microelectronic Solutions divisions are based in Kiev (Ukraine) and Zelenograd (Russia) respectively.

SITRONICS is majority-owned by Sistema (61.3%), which is the largest diversified holding company in Russia and the CIS. SITRONICS' shares are listed under the symbol "SITR" on the London Stock Exchange, the Russian Trading System (RTS), and the Moscow Stock Exchange (MSE).

SITRONICS has developed strategic alliances in its home markets with Cisco Systems, STMicroelectronics, Infineon and Giesecke & Devrient, in relation to certain products and services. SITRONICS has vendor relationships with Siemens, Ericsson, Motorola, ORACLE, Intel, Sun Microsystems and Microsoft. Key customers include Sistema group companies such as MTS, Comstar UTS and MTT, as well as OTE, Cosmote, Vodafone, Ericsson and TCL.

Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of SITRONICS. You can identify forward-looking statements by terms such as "expect," "believe," "anticipate," "estimate," "intend," "will," "could," "may" or "might" the negative of such terms or other expressions. These statements are only predictions and actual events or results may differ materially. We do not intend to or undertake any obligation to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, general economic conditions, our competitive environment, risks associated with operating in Russia, rapid technological and market change in our industries, and other factors specifically related to SITRONICS and its operations.

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