However, the telecommunications corporation said its earnings for the reporting period had increased 51.1% to 104.09 million rubles ($3.9 million) against 68.88 million rubles ($2.5 million) in 1Q05.
"The indicators of the first quarter of 2006 were so low because rent payments and dividends were the main source of earnings (generally received in the second half of the financial year)," the company said in a news release, adding that it expected positive dynamics in profitability indicators.
Pre-tax profit dropped 85% to 1.30 billion rubles ($48 million) as compared with 8.71 billion rubles ($323.2 million) in the same period of 2005.
"Reassessment of listed shares also affected the net profit," the report said.
Sistema was founded in 1993 and manages businesses in service-based industries, including telecommunications, technology, insurance, banking, real estate, retail, and media. The company's main shareholder is Vladimir Yevtushenkov (62.1%), who is its founder and chairman of the board of directors.
