AFK Sistema's net profit leaped to $1.26 bln in 9M05

MOSCOW, November 15 (RIA Novosti) - Russian consumer services company AFK Sistema announced Tuesday that its net profit by Russian accounting standards for the first nine months of 2005 totaled $1.26 billion, which represents a huge year-on-year leap from last year's modest figure of $13.49 million.

The company's head of investor relations, Alexei Kurach, attributed the 93-fold jump in net profit to the revaluation of Sistema's shares in telecoms operators MTS and MTGS traded on MICEX. Sistema holds a controlling stake in both companies.

"This was reflected in the value of assets and net profit according to RAS [Russian Accounting Standards], although it will not be reflected in US GAAP [Generally Accepted Accounting Principles], so it will in no way influence dividends," he said.

Sistema's revenue in the first nine months totaled $140 million, up 60% year on year.

Sales profit during the period was up 47.5% at $105 million.

Sistema was founded in 1993 and manages businesses in service-based industries, including telecommunications, technology, insurance, banking, real estate, retail, and media.