It's tough to look at a company that's simply firing on all cylinders and say, "It's just not enough." But that's what the market is saying today in response to Russian wireless services provider Vimpel Communications'
From an operational standpoint, it's hard to see how things could have been better, but the market still bid the stock down by as much as 7% following the release.
VimpelCom reported a 38.5% increase in consolidated revenue in the fourth quarter to $2 billion. Profits rose even faster, rising 86% to $368 million. Looking at the full year 2007 compared to 2006, revenue jumped 47% while net income zoomed ahead 80%. The company didn't "acquire" this growth either -- most of it came from expansion in Russia and developing markets in the Commonwealth of Independent States (CIS).
Operationally, the numbers show that management is running a tight ship at VimpelCom. A stock price that doubled caused stock-based compensation to drop operating margins (operating income evaluated before depreciation and amortization charges, or OIBDA) to 45.7% in the quarter. Average revenue per user also climbed significantly in its core Russian market to $13.50 per month. Efforts to grow revenue in developed markets appears to be paying off.
U.S. operators such as AT&T
But competition from main rival Mobile TeleSystems
While there's much uncertainty ahead for VimpelCom with its new acquisition of Golden Telecom -- not to mention the risk of just being a Russian company -- the wireless operator remains one of my favorite international telecoms. It doesn't have the massive base that China Mobile
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Fool contributor Dave Mock has more than 100 creative uses for toilet paper. He owns no shares of companies mentioned here. Sprint Nextel is an Inside Value recommendation. Dave is the author of The Qualcomm Equation. The Fool's disclosure policy can be written on a grain of rice, but why would you want to?