Russia's Megafon says Q3 earnings rise, beat forecast

MOSCOW, Oct (HKSE: 3366-OL.HK - news) 29 (Reuters) - Russia's No.2 mobile phone operator Megafon reported a 4 percent rise in third-quarter net profit to beat forecasts on Thursday helped by gains on foreign currency holdings.

The company recommended an additional dividend of 40 billion roubles, or 64.51 per share, which will bring its total payout in 2015 to 50 billion roubles, or 80.64 roubles per share, exceeding the minimum target it gave earlier this year.

Net (LSE: 0LN0.L - news) profit rose to 13.3 billion roubles ($207.5 million) from 12.8 billion in the third quarter of 2014 and topped the 11.8 billion seen in a Reuters poll of analysts.

It (Other OTC: ITGL - news) said profit growth was driven by lower foreign exchange losses and gains in derivative financial instruments resulting from its foreign exchange management.

Operating income before depreciation and amortisation (OIBDA) fell 3 percent to 36.1 billion roubles on higher advertising expenses, rent and utility costs due to network expansion and an increase in taxes.

Its OIBDA margin slipped to 44.5 percent from 46 percent a year earlier, as revenue edged up 0.3 percent to 81.3 billion roubles, the company said.

Megafon, in which Russian tycoon Alisher Usmanov is the biggest shareholder, raised its 2015 OIBDA margin forecast to 41.5 percent from 40 percent but said it expected constraints in consumer spending and intensified competition to exert downward pressure on profitability.

($1 = 64.1055 roubles) (Reporting by Maria Kiselyova; editing by Jack Stubbs and Jason Neely)