Edgar Filing: OPEN JOINT STOCK CO VIMPEL COMMUNICATIONS

Form 6-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

Report of Foreign Issuer

Pursuant to Rule 13a-16 or 15d-16 of

the Securities Exchange Act of 1934

For the month of August 2007

Commission File Number 1-14522

Open Joint Stock Company “Vimpel-Communications”

(Translation of registrant’s name into English)

10 Ulitsa 8-Marta, Building 14, Moscow, Russian Federation 127083

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F [X] Form 40-F [ ]

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): .

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): .

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes [ ] No [X]

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- .

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


		OPEN JOINT STOCK COMPANY
		“VIMPEL-COMMUNICATIONS”
		(Registrant)


Date: August 30, 2007
	By:	/s/ Alexander V. Izosimov
	Name:	Alexander V. Izosimov
	Title:	Chief Executive Officer and General Director

LOGO

FOR IMMEDIATE RELEASE

VIMPELCOM ANNOUNCES SECOND QUARTER AND SIX MONTH 2007

FINANCIAL AND OPERATING RESULTS

Moscow and New York (August 30, 2007) - Open Joint Stock Company “Vimpel-Communications” (“VimpelCom” or the “Company”) (NYSE: VIP), a leading provider of wireless telecommunications services in Russia and the Commonwealth of Independent States (CIS) today announced its financial and operating results for the quarter and six months ended June 30, 2007.

Financial and Operating Highlights

•

Net operating revenues reached a record high $1,717.2 million in the second quarter, a year-on-year increase of 53.1% and a quarter-on-quarter increase of 15.4%.

•

OIBDA reached a record high $896.8 million, a year-on-year increase of 59.7% and a quarter-on-quarter increase of 17.0%.

•

OIBDA margin reached 52.2%, including 53.4% in Russia and 53.7% in Kazakhstan.

•

Net income totaled a record high $359.3 million, a year-on-year increase of 84.3%.

•

Operating cash flow reached a record high $695.6 million, a year-on-year increase of 61.7%.

•

MOU and ARPU grew sequentially in all markets, including 12.8% ARPU growth in Russia

Commenting on today’s announcement, Alexander Izosimov, Chief Executive Officer of VimpelCom, said, “It was another very strong quarter for VimpelCom. The Company achieved all-time records in key financial parameters: revenue, OIBDA, net income and operating cash flow. The strength of our business was further supported by growth of operating parameters, including ARPU and MOU simultaneously in all the markets where we operate. This further validates our belief in the high growth potential of the CIS which is becoming an increasingly important part of our business.

“We are also pleased to note that our OIBDA grew at a remarkable pace of almost 60% year-on-year. Moreover, the fact that our OIBDA grew faster than revenues illustrates that we continue to gain efficiency.”

Changes in definitions and reported data

Beginning with this press-release the Company will use independent research to the extent it is available when reporting market share information. We believe using independent and consistent data is the preferable way to reflect our market share performance.

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VimpelCom Announces Second Quarter And Six Month 2007 Financial And Operating Results

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Beginning with the Company’s 1Q2007 earnings press release, the number of subscribers, ARPU and MOU are reported on the basis of active subscribers. For convenience, we continue to report the registered subscriber base and the related figures for comparable periods (see Attachment A for relevant definitions and refer to Attachment D for relevant data).

All the above-mentioned definitions refer to mobile subscribers. With the acquisition of Armentel, the Company also has fixed-line subscribers which are treated separately.

Attachments A, B, C and D present respectively

definitions for certain terms used in this press release,

the condensed consolidated financial statements of VimpelCom,

tables with relevant reconciliations of non-U.S. GAAP financial measures to their most directly comparable U.S. GAAP financial measures, and

certain additional reference data relating to the registered subscriber base.

Key Consolidated Financial and Operating Results


	Three months
	2Q2007		2Q2006		Change, 2Q07/2Q06		1Q2007		Change, 2Q07/1Q07
Active subscribers	47,701,300		41,282,500		15.5	%	45,784,400		4.2	%
Fixed line subscribers	610,300		NA				607,400		0.5	%
Net operating revenues (US$,000)	1,717,167		1,121,546		53.1	%	1,488,047		15.4	%
OIBDA (US$, 000)	896,758		561,555		59.7	%	766,417		17.0	%
OIBDA margin	52.2	%	50.1	%			51.5	%
Gross margin (US$, 000)	1,402,665		920,276		52.4	%	1,220,993		14.9	%
Gross margin percentage	81.7	%	82.1	%			82.1	%
SG&A (US$, 000)	494,445		355,031		39.3	%	439,467		12.5	%
SG&A percentage	28.8	%	31.7	%			29.5	%
Net income (US$, 000)	359,273		194,946		84.3	%	277,275		29.6	%
Net income per share (US$)	7.07		3.83				5.45
Net income per ADS^*) (US$)	0.35		0.19				0.27

*⁾	Number of ADS for the purpose of this calculation is based on the new ratio of 20 ADSs per one ordinary share, which came into effect on August 21, 2007.

In the second quarter of 2007, VimpelCom invested $334.8 million for the purchase of long-lived assets.

Consolidated figures represent the combined effect of the Company’s operations in Russia, Kazakhstan, Ukraine, Uzbekistan, Tajikistan, Georgia and Armenia.

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VimpelCom Announces Second Quarter And Six Month 2007 Financial And Operating Results

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RUSSIA	Three months
RUSSIA	2Q2007		2Q2006		Change, 2Q07/2Q06		1Q2007		Change, 2Q07/1Q07
Net operating revenues^*) (million US$)	1,459.0		1,020.5		43.0	%	1,278.4		14.1	%
including interconnect revenue	203.3		63.8		218.7	%	170.7		19.1	%
OIBDA (million US$)	779.8		529.7		47.2	%	676.5		15.3	%
OIBDA margin	53.4	%	51.9	%			52.9	%
Gross margin (million US$)	1208.6		849.4		42.3	%	1,064.5		13.5	%
Gross margin percentage	82.8	%	83.2	%			83.2	%
SG&A (million US$)	418.7		317.6		31.8	%	374.8		11.7	%
SG&A percentage	28.7	%	31.1	%			29.3	%
Net income (million US$)	355.7		197.6		80.0	%	280.4		26.9	%

ARPU, (US$)	12.3		9.0		36.7	%	10.9		12.8	%
MOU, (min)	192.6		140.7		36.9	%	160.9		19.7	%
SAC (US$)	22.8		18.0		26.7	%	22.1		3.2	%
Active subscribers	40,139,600		38,161,700		5.2	%	38,631,100		3.9	%
Churn	7.6	%	7.4	%			8.6	%
Subscriber market share^^⁾	30.9	%	33.4	%			31.2	%

^*)	Net operating revenues here and in the following country tables exclude inter-company transactions.

^**)	Subscriber market share data presented here and in the following country tables are published by AC&M-Consulting and are generally based on registered subscribers.

In Russia our continued efforts to deliver growth through active marketing led to 43.0% year-on-year revenue growth, which is a remarkable achievement for a company of our size operating in a saturated market. This trend was further amplified by a favorable business environment and seasonal factors, resulting in a 14.1% increase in revenue in the second quarter of 2007 versus the first quarter of 2007.

Selling, general and administrative expenses (SG&A) as a percentage of net operating revenues were 28.7%, showing improvement on both a quarter-on-quarter and a year-on-year basis, from 29.3% and 31.1%, respectively.

The above-mentioned factors resulted in substantial improvement in OIBDA margin in the second quarter of 2007 as compared with the second quarter of 2006. The net income improvement was also helped by a slowdown in capital expenditures in the first half of 2007, and a corresponding deceleration in growth of depreciation charges.

In April 2007, we received an operating 3G license for the entire territory of Russia. This had no material impact on our results for the second quarter of 2007.

In the second quarter of 2007, VimpelCom invested $188.9 million for the purchase of long-lived assets in Russia.

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VimpelCom Announces Second Quarter And Six Month 2007 Financial And Operating Results

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KAZAKHSTAN	Three months
KAZAKHSTAN	2Q2007		2Q2006		Change, 2Q07/2Q06		1Q2007		Change, 2Q07/1Q07
Net operating revenues (million US$)	148.6		80.1		85.5	%	118.9		25.0	%
including interconnect revenue	26.5		18.9		40.2	%	20.5		29.3	%
OIBDA (million US$)	80.3		33.9		136.9	%	62.0		29.5	%
OIBDA margin	53.7	%	42.2	%			51.9	%
Gross margin (million US$)	112.0		55.3		102.5	%	88.2		27.0	%
Gross margin percentage	75.0	%	68.9	%			73.9	%
SG&A (million US$)	31.7		20.2		56.7	%	25.4		24.8	%
SG&A percentage	21.2	%	25.2	%			21.3	%
Net income^*) (million US$)	16.4		11.0		49.1	%	13.1		25.2	%

ARPU, (US$)	13.6		12.6		7.9	%	12.2		11.5	%
MOU, (min)	88.8		66.3		33.9	%	72.3		22.8	%
SAC (US$)	10.9		9.3		17.2	%	9.0		21.1	%
Active subscribers	3,857,600		2,204,300		75.0	%	3,501,300		10.2	%
Churn	6.3	%	8.2	%			5.5	%
Subscriber market share	49.3	%	44.1	%			50.2	%

^*)	After minority interest.

In the second quarter of 2007, the Company continued the successful development of its Kazakhstan operations. Substantial subscriber growth was accompanied by growth in MOU and ARPU. These factors led to impressive year-on-year and quarter-on-quarter growth in net operating revenues, OIBDA and net income.

OIBDA margin grew to 53.7% the highest level ever recorded by the Company in Kazakhstan. This exceptionally high margin was supported by growth of promotion-driven on-net traffic. We believe that the results demonstrate the underlying strength of the Kazakhstan market.

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UKRAINE	Three months
UKRAINE	2Q2007		2Q2006		Change, 2Q07/2Q06		1Q2007		Change, 2Q07/1Q07
Net operating revenues (US$, million)	22.7		5.8		291.4	%	15.7		44.6	%
including interconnect revenue	7.6		1.8		322.2	%	5.4		40.7	%
OIBDA (million US$)	-3.1		-11.3				-6.5
Gross margin (million US$)	13.5		2.3		487.0	%	9.5		42.1	%
Gross margin percentage	56.7	%	39.0	%			58.3	%
SG&A (million US$)	16.5		13.2		25.1	%	16.0		3.4	%
SG&A percentage	69.5	%	223.7	%			98.2	%
Net income (million US$)	-17.2		-17.0				-18.4

ARPU, (US$)	4.2		5.9		-28.8	%	3.0		40.0	%
MOU, (min)	159.9		172.4		-7.3	%	138.0		15.9	%
SAC (US$)	9.3		14.5		-35.9	%	8.9		4.5	%
Active subscribers	1,821,800		473,300		284.9	%	1,953,200		-6.7	%
Churn	7.0	%	27.4	%			5.7	%
Subscriber market share	5.2	%	1.6	%			4.5	%

Our Ukrainian operations continue to show encouraging trends. Revenues almost quadrupled on a year-on-year basis and we managed to achieve impressive 44.6% quarter-on-quarter revenue growth despite a persistently aggressive pricing environment. A balanced tariff policy combined with seasonal growth in usage and guest roaming allowed us to increase our ARPU by 40.0% on a quarter-on-quarter basis. OIBDA, though still negative, demonstrated a clear positive trend in the second quarter of 2007, and SG&A expenses were practically unchanged compared to the previous quarter.

We have also almost quadrupled the number of active subscribers in Ukraine in the past twelve months. Our subscriber market continues to grow reaching 5.2% in the second quarter of 2007. During the last quarter, we rebalanced our tariffs and tightened our churn policy, which led to a significant improvement in the quality of our subscriber base but at the same time decreased the number of active subscribers on a quarter-on-quarter basis.

Our focus in Ukraine remains on increasing our subscriber base, simultaneously paying attention to its quality, and striving towards positive OIBDA.

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UZBEKISTAN	Three months
UZBEKISTAN	2Q2007		2Q2006		Change, 2Q07/2Q06		1Q2007		Change, 2Q07/1Q07
Net operating revenues (million US$)	23.1		15.0		54.0	%	18.0		28.3	%
OIBDA (million US$)	11.4		9.5		19.8	%	8.7		31.4	%
OIBDA margin	49.1	%	63.3	%			47.7	%
Gross margin (million US$)	20.0		13.1		52.7	%	15.2		31.6	%
Gross margin percentage	86.1	%	87.3	%			83.5	%
SG&A (million US$)	8.4		3.6		133.4	%	6.4		29.7	%
SG&A percentage	36.0	%	23.9	%			35.5	%
Net income (million US$)	4.3		3.6		19.4	%	2.5		72.0	%

ARPU, (US$)	7.2		12.7		-43.3	%	6.7		7.5	%
MOU, (min)	265.6		349.3		-24.0	%	242.2		9.7	%
SAC (US$)	4.4		5.6		-21.4	%	3.7		18.9	%
Active subscribers	1,192,400		434,400		174.5	%	1,106,300		7.8	%
Subscriber market share	32.7	%	25.8	%			33.1	%

In Uzbekistan mobile penetration is still only 15%, so our focus remains on growing our subscriber base. Accordingly, our active subscriber base grew 174.5% year-on-year. Subscriber growth, coupled with an increase in ARPU, led to healthy 28.3% revenue growth in the second quarter of 2007 as compared to the first quarter of 2007.

Our strategy is to continue investing in the development of the market. Key priorities in Uzbekistan are subscriber growth, network build-out, opening of new offices and development of our sales and distribution network.

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TAJIKISTAN	Three months
TAJIKISTAN	2Q2007		2Q2006		Change, 2Q07/2Q06		1Q2007		Change, 2Q07/1Q07
Net operating revenues (million US$)	5.16		0.12		4200.0	%	2.85		81.1	%
OIBDA (million US$)	0.09		-0.31				-0.34
Gross margin (million US$)	3.24		0.08		3950.0	%	1.55		109.0	%
Gross margin percentage	62.5	%	66.7	%			54.2	%
SG&A (million US$)	3.12		0.39		705.7	%	1.89		64.6	%
SG&A percentage	60.2	%	312.1	%			66.1	%
Net income^*) (million US$)	-1.77		-0.30				-1.00

ARPU, (US$)	10.1		4.0		152.5	%	8.7		16.1	%
MOU, (min)	224.2		47.6		371.0	%	205.8		8.9	%
SAC (US$)	15.3		3.5		337.1	%	9.0		70.0	%
Active subscribers	204,900		8,800		2228.4	%	145,300		41.0	%
Subscriber market share	15.2	%	2.2	%			11.2	%

^*)	After minority interest.

Tajikistan continued to demonstrate excellent growth in the second quarter. On a quarter-on-quarter basis the Company reported 81.1% growth in net operating revenues backed by 41.0% growth in the number of active subscribers, an increase in usage and 16.1% growth in ARPU. The Company continued to grow market share in the second quarter.

In order to accelerate growth we increased our sales and marketing investments, which resulted in an increase in SAC. Despite this, OIBDA turned positive in the second quarter.

The rapid development of our Tajikistan operations is due in part to a successful marketing policy, network roll-out, improving service quality and brand promotion activities.

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NEW OPERATIONS


ARMENIA	Three months
ARMENIA	2Q 2007		1Q 2007		Change, 2Q07/1Q07
Net operating revenues (million US$), including	58.35		54.07		7.9	%
Mobile revenues	23.14		19.83		16.7	%
fixed revenues	35.21		34.24		2.8	%
OIBDA (million US$)	30.07		27.31		10.1	%
OIBDA margin	51.6	%	50.4	%
Net income^*) (million US$)	3.96		2.55		55.3	%

Mobile active subscribers	471,000		439,900		7.1	%
ARPU, (US$)	17.3		14.5		19.3	%
MOU, (min)	185.1		141.3		31.0	%
Mobile subscriber market share	33.2	%	37.3	%

Fixed subscribers	610,300		607,400		0.5	%
ARPU fixed (US$)	19.3		18.8		2.7	%

^*)	After minority interest.

Armenian business showed very robust financial performance. We have started to implement changes in tariffs, and changes in customer service and network development across the country aimed at enhancing Armentel’s position in the mobile market. At the same time we are operating the fixed-line network and exploring fixed-to-mobile convergence opportunities. We have initiated a process of large-scale network modernization with the aim of building a next generation converged fixed/mobile network.

While the Company is concerned with the reported erosion of our subscriber market share, we believe that it is largely driven by changing the source of our market share data from internal estimations to AC&M-Consulting. Nonetheless, we are dissatisfied with the absolute level of our market share in Armenia and building it will be our main near-term priority. To address this issue we have developed actions which we believe will strengthen our commercial operations and build market presence starting from the second half of this year.

GEORGIA

The Company launched commercial operations in Georgia on March 15, 2007. Currently we continue to build the network and develop our sales and distribution channels. At the end of the second quarter we had approximately 14,000 active subscribers and revenues of US$ 0.15 million, so our operations in this country are still in the early phases.

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The Company’s management will discuss its second quarter results during a conference call and slide presentation on August 30, 2007 at 6:30 pm Moscow time (10:30 am ET in New York). The call and slide presentation may be accessed via webcast at the following URL address http://www.vimpelcom.com. The conference call replay and the slide presentation webcast will be available through September 06, 2007 and September 27, 2007, respectively. The slide presentation will also be available for download on VimpelCom’s website http://www.vimpelcom.com.

The VimpelCom Group includes companies operating in Russia, Kazakhstan, Ukraine, Uzbekistan, Tajikistan, Georgia and Armenia. The VimpelCom Group’s GSM and 3G license portfolio covers a territory with a population of about 250 million. This includes the entire territories of Russia, Kazakhstan, Ukraine, Uzbekistan, Tajikistan, Georgia and Armenia. VimpelCom was the first Russian company to list its shares on the New York Stock Exchange (“NYSE”). VimpelCom’s ADSs are listed on the NYSE under the symbol “VIP”.

The second quarter 2007 U.S. GAAP financial statements were approved unanimously by our board of directors.

This press release contains “forward-looking statements”, as the phrase is defined in Section 27A of the Securities Act and Section 21E of the Exchange Act. These statements relate to the Company’s strategic and development plans, including network development plans, and developments in the telecommunications markets in which the Company operates. These and other forward-looking statements are based on management’s best assessment of the Company’s strategic and financial position and of future market conditions and trends. These discussions involve risks and uncertainties. The actual outcome may differ materially from these statements as a result of unforeseen developments from competition, governmental regulation of the telecommunications industries in Russia and the CIS, general political uncertainties in Russia and the CIS and general economic developments in Russia and the CIS, challenges to 3G and Far East tenders and/or litigation with third parties or our shareholders (including Telenor), the Company’s ability to continue to grow its overall revenues and its subscriber base, continued volatility in the world economy and other factors. As a result of such risks and uncertainties, there can be no assurance that the effects of competition or current or future changes in the political, economic and social environment or current or future regulation of the Russian and CIS telecommunications industries will not have a material adverse effect on the VimpelCom Group.Certain factors that could cause actual results to differ materially from those discussed in any forward-looking statements include the risks described in the Company’s Annual Report on Form 20-F for the year ended December 31, 2006 and other public filings made by the Company with the United States Securities and Exchange Commission, which risk factors are incorporated herein by reference. VimpelCom disclaims any obligation to update developments of these risk factors or to announce publicly any revision to any of the forward-looking statements contained in this release, or to make corrections to reflect future events or developments.


For more information, please contact:

Alexander Boreyko		Peter Schmidt/Michael Polyviou
VimpelCom		Financial Dynamics
Tel: 7(495) 910-5977		Tel: 1(212) 850 5600
Investor_Relations@vimpelcom.com		mpolyviou@fd-us.com

-Definitions and tables are attached –

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Attachment A: Definitions

Registered subscriber is an authorized user of cellular services, using one SIM card (GSM/3G) with one or several selective numbers or one handset (DAMPS/CDMA) with one selective number. The number of subscribers includes employees using cellular services and excludes guest roamers and users of test SIM cards or handsets.

Churn rate is defined as the total number of registered subscribers disconnected from our network within a given period of time expressed as a percentage of the midpoint of subscribers in our network at the beginning and end of that period. Contract subscribers are disconnected if they have not paid their bills for 2 months and prepaid subscribers are disconnected 6 months after their services have been blocked. We typically block a prepaid subscriber’s service in two cases: (1) their balance drops to $0 or below, and (2) an account shows no chargeable activity within 6 months. The Company retains the right to change its disconnect policy to reflect changes in business or regulatory environment.

Active subscribers are those subscribers in the registered subscriber base who were a party to a revenue generating activity in the past three months and remain in the base at the end of the reported period. Such activities include all incoming and outgoing calls, subscriber fee accruals, debits related to service, outgoing SMS, MMS, data transmission and receipt sessions, but do not include incoming SMS and MMS sent by our Company or abandoned calls.

Prepaid subscribers are those subscribers who pay for their services in advance.

Fixed-line subscriber is an authorized user of fixed-line communications services.

OIBDA is a non-U.S. GAAP financial measure. OIBDA, previously referred to as EBITDA by the Company, is defined as operating income before depreciation and amortization. The Company believes that OIBDA provides useful information to investors because it is an indicator of the strength and performance of our business operations, including our ability to finance capital expenditures, acquisitions and other investments and our ability to incur and service debt. While depreciation and amortization are considered operating costs under U.S. GAAP, these expenses primarily represent the non-cash current period allocation of costs associated with long-lived assets acquired or constructed in prior periods. Our OIBDA calculations are commonly used as bases for some investors, analysts and credit rating agencies to evaluate and compare the periodic and future operating performance and value of companies within the wireless telecommunications industry. OIBDA should not be considered in isolation as an alternative to net income, operating income or any other measure of performance under U.S. GAAP. OIBDA does not include our need to replace our capital equipment over time. Reconciliation of OIBDA to operating income, the most directly comparable U.S. GAAP financial measure, is presented below in the reconciliation tables section.

OIBDA margin is OIBDA expressed as a percentage of total net operating revenues. Reconciliation of OIBDA margin to operating income as a percentage of total net operating revenues, the most directly comparable U.S. GAAP financial measure, is presented below in the reconciliation tables section.

Gross margin is defined as total operating revenues less service costs and cost of handsets and accessories sold.

Gross margin percentage is gross margin expressed as a percentage of total net operating revenues.

Each ADS represents 0.05 of one share of common stock. This ratio was established effective August 21, 2007.

ARPU (Monthly Average Revenue per User), a non-U.S. GAAP financial measure, is calculated by dividing the Company’s service revenue during the relevant period, including roaming revenue and interconnect revenue, but excluding revenue from connection fees, sales of handsets and accessories and other non-service revenue, by the average number of the Company’s active subscribers during the period and dividing by the number of months in that period. Reconciliation of ARPU to service revenues and connection fees, the most directly comparable U.S. GAAP financial measure, is presented below in the tables section. The Company believes that ARPU provides useful information to investors because it is an indicator of the performance of the Company’s business operations and assists management in budgeting. The Company also believes that ARPU provides management with useful information concerning usage and acceptance of the Company’s services. ARPU should not be viewed in isolation or an alternative to other figures reported under U.S. GAAP.

ARPU_REG is ARPU calculated with regard to the registered subscriber base.

MOU (Monthly Average Minutes of Use per User) is calculated by dividing the total number of minutes of usage for incoming and outgoing calls during the relevant period (excluding guest roamers) by the average number of active subscribers during the period and dividing by the number of months in that period.

MOU_REG is MOU calculated with regard to the registered subscriber base.

SAC (Average Acquisition Cost Per User), a non-U.S. GAAP financial measure, is calculated as dealers’ commissions (for sales and bonus for exclusivity^*), advertising expenses and handset subsidies for the relevant period divided by the number of new subscribers added during the relevant period. Reconciliation of SAC to selling, general and administrative expenses, the most directly comparable U.S. GAAP financial measure, is presented below in the tables section. The Company believes that SAC in growing markets provides useful information to investors because it is an indicator of the performance of the Company’s business operations and assists management in budgeting. The Company also believes that SAC assists management in quantifying the incremental costs to acquire a new subscriber. SAC should not be viewed in isolation or as an alternative to other figures reported under U.S. GAAP.

Market share of subscribers for each relevant area is calculated by dividing the estimated number of our subscribers in Russia, Kazakhstan, Ukraine, Uzbekistan, Tajikistan and Armenia, respectively, by the total estimated number of subscribers in Russia, Kazakhstan, Ukraine, Uzbekistan, Tajikistan and Armenia, respectively.

^*)

Dealers’ bonus for exclusivity which we counted prior to the fourth quarter of 2006 as a part of general and administrative expenses is now included in the dealers’ commission expense. Historical numbers including SAC were recalculated accordingly.

Attachment B: VimpelCom financial statements

Open Joint Stock Company “Vimpel-Communications”

Unaudited Condensed Consolidated Statements of Operations


	Three months ended June 30,						Six months ended June 30,
	2007			2006			2007			2006
	*(In thousands of US dollars, except per share (ADS) amounts)*
Operating revenues:
Service revenues and connection fees	$	1,715,482		$	1,116,152		$	3,201,674		$	2,046,302
Sales of handsets and accessories		1,263			5,319			2,785			10,648
Other revenues		1,236			577			2,202			1,564

Total operating revenues		1,717,981			1,122,048			3,206,661			2,058,514

Revenue based tax		(814	)		(502	)		(1,447	)		(801	)

Net operating revenues		1,717,167			1,121,546			3,205,214			2,057,713

Operating expenses:
Service costs (exclusive of depreciation shown separately below)		313,011			196,374			578,337			359,293
Cost of handsets and accessories sold		1,491			4,896			3,219			9,846
Selling, general and administrative expenses		494,445			355,031			933,912			637,956
Depreciation		285,365			194,845			554,537			365,939
Amortization		53,807			43,148			107,096			84,103
Provision for doubtful accounts		11,462			3,690			26,571			6,456

Total operating expenses		1,159,581			797,984			2,203,672			1,463,593

Operating income		557,586			323,562			1,001,542			594,120

Other income and expenses:
Interest income		7,657			3,491			12,309			4,883
Other income		864			1,691			3,041			3,795
Interest expense		(47,643	)		(47,419	)		(93,448	)		(90,592	)
Other expenses		(8,730	)		(7,738	)		(21,721	)		(12,315	)
Net foreign exchange gain (loss)		8,362			20,103			25,091			25,682

Total other income and expenses		(39,490	)		(29,872	)		(74,728	)		(68,547	)

Income before income taxes and minority interest		518,096			293,690			926,814			525,573

Income taxes expense		143,648			87,866			263,594			163,744
Minority interest in net earnings of subsidiaries		15,175			10,878			26,672			14,778

Income before cumulative effect of change in accounting principle		359,273			194,946			636,548			347,051

Cumulative effect of changes in accounting principles		—			—			—			(1,882	)

Net income	$	359,273		$	194,946		$	636,548		$	345,169

Net income per common share	$	7.07		$	3.83		$	12.52		$	6.77
Net income per ADS equivalent	$	0.35		$	0.19		$	0.63		$	0.34

Weighted average common shares outstanding (thousands)		50,833			50,913			50,862			50,972

Dividends per share	$	6.47			—		$	6.47			—
Dividends per ADS equivalent	$	0.32			—		$	0.32			—

Open Joint Stock Company “Vimpel-Communications”

Unaudited Condensed Consolidated Balance Sheets


	June 30, 2007		December 31, 2006
	(*In thousands of US dollars)*
Assets
Current assets:
Cash and cash equivalents	$	950,666	$	344,494
Trade accounts receivable		288,492		311,991
Other current assets		416,850		468,071

Total current assets		1,656,008		1,124,556

Non-current assets
Property and equipment, net		4,865,589		4,615,675
Telecommunication licenses and allocation of frequencies, net		888,912		924,809
Other intangible assets, net		1,067,448		1,033,140
Other assets		732,743		738,366

Total non-current assets		7,554,692		7,311,990

Total assets	$	9,210,700	$	8,436,546

Liabilities and shareholders’ equity
Current liabilities:
Accounts payable	$	555,623	$	671,532
Due to related parties		939		421
Customer advances and deposits		299,373		314,375
Bank loans, current portion		361,660		358,211
Dividends payable, net		283,868		—
Accrued liabilities		437,486		267,437

Total current liabilities		1,938,949		1,611,976

Deferred income taxes		511,356		528,025
Bank and other loans, less current portion		2,096,280		1,980,726
Equipment financing and other liabilities		105,321		115,050

Minority Interest		246,552		257,859

Shareholders’ equity		4,312,242		3,942,910

Total liabilities and shareholders’ equity	$	9,210,700	$	8,436,546

Open Joint Stock Company “Vimpel-Communications”

Unaudited Condensed Consolidated Statements of Cash Flows


	Six months ended June 30,
	2007			2006
	*(In thousands of US dollars)*
Net cash provided by operating activities	$	1,351,512		$	792,024

Proceeds from bank and other loans		291,896			744,409
Sale of treasury stock		34,995			2,784
Payments of fees in respect of bank loans		(1,288	)		(37,789	)
Repayment of rouble denominated bonds		—			(110,783	)
Repayment of bank and other loans		(176,674	)		(234,372	)
Repayment of equipment financing obligations		(38,429	)		(31,946	)
Purchase of treasury stock		(81,069	)		(38,535	)
Repayment of lease obligations		(331	)		—

Net cash provided by financing activities		29,100			293,768

Purchase of property and equipment		(604,238	)		(532,422	)
Acquisition of subsidiaries, net of cash		(55,924	)		(252,522	)
Purchase price adjustment for ArmenTel and Tacom		(12,688	)		—
Purchase of intangible assets		(14,185	)		(21,275	)
Purchase of other assets		(93,403	)		(194,529	)

Net cash used in investing activities		(780,437	)		(1,000,748	)

Effect of exchange rate changes on cash		5,997			9,121

Net increase (decrease) in cash		606,172			94,165
Cash and cash equivalents at beginning of period		344,494			363,646

Cash and cash equivalents at end of period	$	950,666		$	457,811

Supplemental cash flow information

Cash paid during the period:
Income tax	$	260,199		$	129,832
Interest		99,475			88,391

Non-cash activities:
Equipment acquired under financing and capital lease agreements	$	25,873		$	3,536
Accounts payable for equipment and other long-lived assets		199,033			170,804
Offset of 2009 Tendered Notes		—			232,766
Utilized part of Ericsson non-cash discount in Ukraine		(1,658	)		22,161
Acquisitions:
Fair value of assets acquired		—			150,021
Fair value of minority interest acquired		41,636			—
Difference between the amount paid and the fair value of net assets acquired		14,288			154,061
Cash paid for the capital stock		(55,924	)		(260,974	)

Liabilities assumed	$	—		$	43,108

Attachment C. Reconciliation tables (Unaudited)

CONSOLIDATED

Reconciliation of OIBDA

(In thousands of US dollars)


	Three months ended
	June 30, 2007		June 30, 2006		March 31, 2007
OIBDA	896,758		561,555		766,417
Depreciation	(285,365	)	(194,845	)	(269,172	)
Amortization	(53,807	)	(43,148	)	(53,289	)
Operating income	557,586		323,562		443,956

Reconciliation of OIBDA Margin


	Three months ended
	June 30, 2007		June 30, 2006		March 31, 2007
OIBDA margin	52.2	%	50.1	%	51.5	%
Less: Depreciation as a percentage of net operating revenue	(16.6	)%	(17.4	)%	(18.1	)%
Less: Amortization as a percentage of net operating revenue	(3.1	)%	(3.9	)%	(3.6	)%
Operating income as a percentage of net operating revenue	32.5	%	28.8	%	29.8	%

RUSSIA

Reconciliation of OIBDA in Russia

(In thousands of US dollars)


	Three months ended
	June 30, 2007		June 30, 2006		March 31, 2007
OIBDA	779,828		529,704		676,476
Depreciation	(240,387	)	(182,684	)	(232,681	)
Amortization	(28,478	)	(25,657	)	(28,536	)
Operating income	510,963		321,363		415,259

Reconciliation of OIBDA Margin in Russia


	Three months ended
	June 30, 2007		June 30, 2006		March 31, 2007
OIBDA margin	53.4	%	51.9	%	52.9	%
Less: Depreciation as a percentage of net operating revenue	(16.5	)%	(17.9	)%	(18.2	)%
Less: Amortization as a percentage of net operating revenue	(1.9	)%	(2.5	)%	(2.2	)%
Operating income as a percentage of net operating revenue	35.0	%	31.5	%	32.5	%

Reconciliation of SAC in Russia

(In thousands of US dollars, except for SAC and subscriber amounts)


	Three months ended
	June 30, 2007	June 30, 2006	March 31, 2007
Selling, general and administrative expenses	418,738	317,608	374,757
Less: General and administrative expenses	305,941	219,320	284,977
Sales and marketing expenses, including	112,797	98,288	89,780
advertising & marketing expenses	57,636	50,709	43,132
dealers’ commission expense	55,161	47,579	46,648
New gross subscribers,’000	4,947	5,469	4,056
Subscriber Acquisition Cost (SAC) (US$)	22.8	18.0	22.1

Reconciliation of ARPU in Russia

(In thousands of US dollars, except for ARPU and subscriber amounts)


	Three months ended
	June 30, 2007	June 30, 2006	March 31, 2007
Service revenue and connection fees	1,457,896	1,014,810	1,276,754
Less: Connection fees	164	622	169
Less: Revenue from rent of fiber-optic channels	983	325	964
Service revenue used to calculate ARPU	1,456,749	1,013,863	1,275,621
Average number of registered subscribers, ‘000	49,043	45,803	47,974
ARPU _REG (US$)	9.9	7.4	8.9
Average number of active subscribers,’000	39,359	37,733	39,021
ARPU (US$)	12.3	9.0	10.9

KAZAKHSTAN

Reconciliation of OIBDA in Kazakhstan

(In thousands of US dollars)


	Three months ended
	June 30, 2007		June 30, 2006		March 31, 2007
OIBDA	80,317		33,908		62,007
Depreciation	(17,537	)	(9,363	)	(15,817	)
Amortization	(9,419	)	(9,324	)	(9,154	)
Operating income	53,361		15,221		37,036

Reconciliation of OIBDA Margin in Kazakhstan

(In thousands of US dollars)


	Three months ended
	June 30, 2007		June 30, 2006		March 31, 2007
OIBDA margin	53.7	%	42.2	%	51.9	%
Less: Depreciation as a percentage of net operating revenue	(11.7	)%	(11.7	)%	(13.2	)%
Less: Amortization as a percentage of net operating revenue	(6.3	)%	(11.5	)%	(7.7	)%
Operating income as a percentage of net operating revenue	35.7	%	19.0	%	31.0	%

Reconciliation of SAC in Kazakhstan

(In thousands of US dollars, except for SAC and subscriber amounts)


	Three months ended
	June 30, 2007	June 30, 2006	March 31, 2007
Selling, general and administrative expenses	31,723	20,240	25,423
Less: General and administrative expenses	23,250	14,761	18,700
Sales and marketing expenses, including	8,473	5,479	6,723
advertising & marketing expenses	4,918	2,275	3,895
dealers’ commission expense	3,555	3,204	2,828
New gross subscribers,’000	779	588	744
Subscriber Acquisition Cost (SAC) (US$)	10.9	9.3	9.0

Reconciliation of ARPU in Kazakhstan

(In thousands of US dollars, except for ARPU and subscriber amounts)


	Three months ended
	June 30, 2007	June 30, 2006	March 31, 2007
Service revenue and connection fees	149,326	80,301	119,399
Less: Connection fees	0	0	0
Less: Revenue from rent of fiber-optic channels	0	0	0
Service revenue used to calculate ARPU	149,326	80,301	119,399
Average number of registered subscribers, ‘000	4,598	2,681	4,086
ARPU _REG (US$)	10.8	10.0	9.7
Average number of active subscribers,’000	3,655	2,120	3,271
ARPU (US$)	13.6	12.6	12.2

UKRAINE

Reconciliation of OIBDA in Ukraine

(In thousands of US dollars)


	Three months ended
	June 30, 2007		June 30, 2006		March 31, 2007
OIBDA	(3,073	)	(11,259	)	(6,518	)
Depreciation	(4,330	)	(859	)	(3,203	)
Amortization	(5,234	)	(4,909	)	(5,210	)
Operating income	(12,637	)	(17,027	)	(14,931	)

Reconciliation of SAC in Ukraine

(In thousands of US dollars, except for SAC and subscriber amounts)


	Three months ended
	June 30, 2007	June 30, 2006	March 31, 2007
Selling, general and administrative expenses	16,527	13,216	15,980
Less: General and administrative expenses	11,833	7,283	10,844
Sales and marketing expenses, including	4,694	5,933	5,136
advertising & marketing expenses	3,723	5,312	4,158
dealers’ commission expense	971	621	978
New gross subscribers,’000	504	408	578
Subscriber Acquisition Cost (SAC) (US$)	9.3	14.5	8.9

Reconciliation of ARPU in Ukraine

(In thousands of US dollars, except for ARPU and subscriber amounts)


	Three months ended
	June 30, 2007	June 30, 2006	March 31, 2007
Service revenue and connection fees	23,436	5,948	16,158
Less: Connection fees	36	0	5
Less: Revenue from rent of fiber-optic channels	0	0	0
Service revenue used to calculate ARPU	23,400	5,948	16,153
Average number of registered subscribers, ‘000	2,474	424	2,143
ARPU _REG (US$)	3.2	4.7	2.5
Average number of active subscribers,’000	1,847	338	1,781
ARPU (US$)	4.2	5.9	3.0

UZBEKISTAN

Reconciliation of OIBDA in Uzbekistan

(In thousands of US dollars)


	Three months ended
	June 30, 2007		June 30, 2006		March 31, 2007
OIBDA	11,388		9,507		8,664
Depreciation	(3,312	)	(1,902	)	(3,097	)
Amortization	(3,414	)	(3,113	)	(3,383	)
Operating income	4,662		4,492		2,184

Reconciliation of OIBDA Margin in Uzbekistan


	Three months ended
	June 30, 2007		June 30, 2006		March 31, 2007
OIBDA margin	49.1	%	63.3	%	47.7	%
Less: Depreciation as a percentage of net operating revenue	(14.3	)%	(12.7	)%	(17.0	)%
Less: Amortization as a percentage of net operating revenue	(14.7	)%	(20.7	)%	(18.6	)%
Operating income as a percentage of net operating revenue	20.1	%	29.9	%	12.0	%

Reconciliation of SAC in Uzbekistan

(In thousands of US dollars, except for SAC and subscriber amounts)


	Three months ended
	June 30, 2007	June 30, 2006	March 31, 2007
Selling, general and administrative expenses	8,355	3,580	6,442
Less: General and administrative expenses	6,579	2,869	4,630
Sales and marketing expenses, including	1,776	711	1,812
advertising & marketing expenses	856	266	699
dealers’ commission expense	920	445	1,113
New gross subscribers,’000	403	127	488
Subscriber Acquisition Cost (SAC) (US$)	4.4	5.6	3.7

Reconciliation of ARPU in Uzbekistan

(In thousands of US dollars, except for ARPU and subscriber amounts)


	Three months ended
	June 30, 2007	June 30, 2006	March 31, 2007
Service revenue and connection fees	24,009	15,507	18,778
Less: Connection fees	0	0	0
Less: Revenue from rent of fiber-optic channels	0	0	0
Service revenue used to calculate ARPU	24,009	15,507	18,778
Average number of registered subscribers, ‘000	1,148	456	980
ARPU _REG (US$)	7.0	11.3	6.4
Average number of active subscribers,’000	1,109	406	930
ARPU (US$)	7.2	12.7	6.7

TAJIKISTAN

Reconciliation of OIBDA in Tajikistan

(In thousands of US dollars)


	Three months ended
	June 30, 2007		June 30, 2006		March 31, 2007
OIBDA	94		(305	)	(343	)
Depreciation	(587	)	(37	)	(345	)
Amortization	(158	)	(145	)	(158	)
Operating income	(651	)	(487	)	(846	)

Reconciliation of SAC in Tajikistan

(In thousands of US dollars, except for SAC and subscriber amounts)


	Three months ended
	June 30, 2007	June 30, 2006	March 31, 2007
Selling, general and administrative expenses	3,118	387	1,894
Less: General and administrative expenses	2,044	386	1,199
Sales and marketing expenses, including	1074	0.7	695
advertising & marketing expenses	665	0.6	305
dealers’ commission expense	409	0.1	390
New gross subscribers,’000	70	0.2	77
Subscriber Acquisition Cost (SAC) (US$)	15.3	3.5	9.0

Reconciliation of ARPU in Tajikistan

(In thousands of US dollars, except for ARPU and subscriber amounts)


	Three months ended
	June 30, 2007	June 30, 2006	March 31, 2007
Service revenue and connection fees	5,222	119	2,891
Less: Connection fees	0	0	0
Less: Revenue from rent of fiber-optic channels	0	0	0
Service revenue used to calculate ARPU	5,222	119	2,891
Average number of registered subscribers, ‘000	181	18	113
ARPU _REG (US$)	9.6	2.2	8.5
Average number of active subscribers,’000	172	10	111
ARPU (US$)	10.1	4.0	8.7

ARMENIA

Reconciliation of OIBDA in Armenia

(In thousands of US dollars)


	Three months ended
	June 30, 2007		June 30, 2006	March 31, 2007
OIBDA	30,069		NA	27,309
Depreciation	(18,729	)	NA	(13,941	)
Amortization	(5,875	)	NA	(5,865	)
Operating income	5,465		NA	7,503

Reconciliation of OIBDA Margin in Armenia


	Three months ended
	June 30, 2007		June 30, 2006	March 31, 2007
OIBDA margin	51.6	%	NA	50.4	%
Less: Depreciation as a percentage of net operating revenue	(32.1	)%	NA	(25.7	)%
Less: Amortization as a percentage of net operating revenue	(10.1	)%	NA	(10.8	)%
Operating income as a percentage of net operating revenue	9.4	%	NA	13.9	%

Reconciliation of mobile ARPU in Armenia

(In thousands of US dollars, except for ARPU and subscriber amounts)


	Three months ended
	June 30, 2007	June 30, 2006	March 31, 2007
Service revenue and connection fees	23,208	NA	19,912
Less: Connection fees	19	NA	129
Less: Revenue from rent of fiber-optic channels	0	NA	0
Service revenue used to calculate ARPU	23,189	NA	19,783
Average number of registered subscribers, ‘000	486	NA	468
ARPU _REG (US$)	15.9	NA	14.1
Average number of active subscribers,’000	446	NA	456
ARPU (US$)	17.3	NA	14.5

Reconciliation of fixed ARPU in Armenia

(In thousands of US dollars, except for ARPU and subscriber amounts)


	Three months ended
	June 30, 2007	June 30, 2006	March 31, 2007
Service revenue and connection fees	35,214	NA	34,242
Less: Connection fees	55	NA	0
Service revenue used to calculate ARPU	35,159	NA	34,242
Average number of subscribers,’000	608	NA	607
Average revenue per subscriber per month (US$)	19.3	NA	18.8

Attachment D. Additional reference data

Operating and Financial Indicators


CONSOLIDATED	Three months
CONSOLIDATED	2Q2007	2Q2006	Change, 2Q07/2Q06		1Q2007	Change, 2Q07/1Q07
Registered mobile subscribers	59,049,700	50,822,100	16.2	%	56,805,600	4.0	%
Registered fixed subscribers	610,300	NA			607,400	0.5	%

RUSSIA	Three months
RUSSIA	2Q2007	2Q2006	Change, 2Q07/2Q06		1Q2007	Change, 2Q07/1Q07
Registered subscribers	49,594,300	46,905,600	5.7	%	48,345,300	2.6	%
ARPU_REG, (US$)	9.9	7.4	33.8	%	8.9	11.2	%
MOU_REG, (min)	154.6	115.9	33.4	%	130.9	18.1	%

KAZAKHSTAN	Three months
KAZAKHSTAN	2Q2007	2Q2006	Change, 2Q07/2Q06		1Q2007	Change, 2Q07/1Q07
Registered subscribers	4,837,200	2,880,900	67.9	%	4,345,600	11.3	%
ARPUREG, (US$)	10.8	10.0	8.0	%	9.7	11.3	%
MOUREG, (min)	70.6	52.4	34.7	%	57.9	21.9	%

UKRAINE	Three months
UKRAINE	2Q2007	2Q2006	Change, 2Q07/2Q06		1Q2007	Change, 2Q07/1Q07
Registered subscribers	2,661,400	569,400	367.4	%	2,331,300	14.2	%
ARPU_REG, (US$)	3.2	4.7	-31.9	%	2.5	28.0	%
MOU_REG, (min)	119.4	137.2	-13.0	%	114.7	4.1	%

UZBEKISTAN	Three months
UZBEKISTAN	2Q2007	2Q2006	Change, 2Q07/2Q06		1Q2007	Change, 2Q07/1Q07
Registered subscribers	1,224,800	451,600	171.2	%	1,147,200	6.8	%
ARPU_REG, (US$)	7.0	11.3	-38.1	%	6.4	9.4	%
MOU_REG, (min)	256.5	311.5	-17.7	%	229.9	11.6	%

TAJIKISTAN	Three months
TAJIKISTAN	2Q2007	2Q2006	Change, 2Q07/2Q06		1Q2007	Change, 2Q07/1Q07
Registered subscribers	218,000	14,600	1393.2	%	149,900	45.4	%
ARPU_REG, (US$)	9.6	2.2	336.4	%	8.5	12.9	%
MOU_REG, (min)	213.7	26.1	718.8	%	201.2	6.2	%


ARMENIA	Three months
ARMENIA	2Q2007	2Q2006	Change, 2Q07/2Q06	1Q2007	Change, 2Q07/1Q07
Registered mobile subscribers	497,600	NA	NA	478,000	4.1	%
ARPU_REG, (US$)	15.9	NA	NA	14.1	12.8	%
MOU_REG, (min)	169.9	NA	NA	137.6	23.5	%

VimpelCom

Presentation of 2Q 2007

Financial

and

Operating Results

August 30, 2007

Disclaimer

This presentation contains "forward-looking statements", as the phrase is defined in Section 27A of the

Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements relate, in

part, to the Company’s strategy and development plans in Russia and the CIS, development of the Company’s

network

Russia

and

the

outcome

license

tenders

the

Far

East

Region

Russia.

The

forward-

looking statements are based on management's best assessment of the Company's strategic and financial

position, and future market conditions and trends. These discussions involve risks and uncertainties. The

actual outcome may differ materially from these statements as a result of risks and uncertainties relating to

developments from competition, governmental regulations of the wireless telecommunications industry,

general political uncertainties in Russia and the CIS, general economic developments in Russia and the CIS,

challenges to 3G and Far East tenders, and/or litigation with third parties or our shareholders (including

Telenor).

The

actual

outcome

may

also

differ

materially

the

Company

unable

obtain

all

necessary

corporate

approvals

relating

its

business

(including

approval

funding,

specific

transactions

and

payment

of dividends),

and

other

factors.

There

can

assurance

that

these

risks

and

uncertainties

will

not

have

material

adverse

effect

the

Company,

that

the

Company

will

able

grow

that

will

successful

executing its strategy and development plans. Certain factors that could cause actual results to differ

materially from those discussed in any forward-looking statements include the risks described in the

Company's Annual Report on Form 20-F for the year ended December 31, 2006 and other public filings made

by the Company with the United States Securities and Exchange Commission, which risk factors are

incorporated herein by reference. The Company disclaims any obligation to update developments of these risk

factors or to announce publicly any revision to any of the forward-looking statements contained in this

release, or to make corrections to reflect future events or developments.

Agenda

Kent McNeley, CMO

Nikolay

Pryanishnikov,

Executive VP, General Director, Russia

will be joined by:

Q&A Session

Alexander Izosimov, CEO

Operational Overview

Elena Shmatova, CFO

Financial Overview

Alexander Izosimov, CEO

Welcome Remarks

Quarterly Financial Dynamics

Net Revenues, $ mln

Net Income, $ mln

OIBDA, $ mln

OIBDA Margin

+53.1%

936

1,122

1,359

1,451

1,488

1,717

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

+84.3%

359

277

198

268

195

150

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

+59.7%

897

766

690

718

562

483

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

51.6%

50.1%

52.8%

47.5%

51.5%

52.2%

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

Continuing Increase of Operating Cash Flow

804

2,531

1,971

1,293

-1,512

-1,553

-1,635

-1,242

-438

-342

978

459

2004

2005

2006

2Q 07LTM

Operating Cash Flow, $ mln

CAPEX, $ mln

Free cash-flow before acquisitions

Strong Balance Sheet

* In cases when OIBDA is part of financial ratios it is deemed to be

calculated in accordance with the reconciliation tables herein

($ mln)

Jun 30,'07

Dec 31,'06

Dec 31,'05

Cash and Cash Equivalents

951

344

364

Total Assets

9,211

8,437

6,307

Total Debt

2,598

2,489

1,998

-Short-term

427

424

421

-Long-term

2,171

2,065

1,577

Shareholders' Equity

4,312

3,943

2,741

LTM OIBDA*

3,071

2,452

1,571

LTM Depreciation and

amortization

1,266

1,055

593

LTM Operating Income

1,805

1,397

978

LTM Interest

189

186

147

Debt/Assets

0.3

Net Debt

1,647

2,145

1,634

13.2

16.2

10.7

0.6

0.7

1.0

1.3

0.8

0.0

6.0

12.0

18.0

Dec 31, '05

Dec 31, '06

Jun 30, '07

-0.4

-0.2

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

OIBDA LTM/Interest LTM

Debt/Equity

Debt/OIBDA LTM

Operating Highlights: Russia

MOU, min

ARPU, US$

Active Subscriber Base, mln

Subscriber Market Share

)

Source: AC&M Consulting

37.4

38.2

38.8

38.6

40.1

39.8

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

7.8

9.0

10.6

10.9

12.3

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

132

141

152

158

161

193

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

31%

32%

33%

34%

35%

34%

33%

20%

19%

18%

16%

15%

14%

13%

15%

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

VimpelCom

MTS

MegaFon

Others

Financial Highlights: Russia

Net Revenues, $ mln

OIBDA, $ mln

CAPEX, $ mln

CAPEX / Revenue, LTM

+43.0%

1,459

1,278

1,281

1,228

1,021

871

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

+47.2%

780

677

645

666

530

462

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

189

200

380

226

297

146

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

19.0%

22.9%

23.9%

32.5%

36.1%

41.6%

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

Status of 3G Development in Russia

License awarded

Commercial operations

Equipment certification

Equipment tender

initiated

2007

2008

Tender

completed

Network construction

begins

Trial operations

2G Licensing Developments in Russian Far East

Tenders were recently conducted for licenses in

several of the Far East regions

VimpelCom

challenged the results and the terms of

all of the tenders as unfair and discriminatory. The

Russian Federal Anti-monopoly Service (FAS)

supported our position and asked the courts to annul

the results of the tenders

•

A newly created regulator suspended further tenders

for the Far East licenses while reviewing their terms

and conditions. New tenders are expected to take

place in mid-October

Sources of Year-on-Year Growth

Net Revenue Growth, $ mln

OIBDA Growth, $ mln

Subscriber

Growth, ‘000

1,717

1,122

1,459

101

157

258

1,021

438

2Q 06

Russia

CIS

2Q 07

897

562

530

117

250

780

2Q 06

Russia

CIS

2Q 07

47,701

41,283

38,162

3,121

7,561

1,978

40,140

4,440

2Q 06

Russia

CIS

2Q 07

Russia

CIS

Operating Highlights: Kazakhstan

ARPU,

US$

MOU,

min

Active Subscriber Base, mln

Subscriber Market Share

2.6

3.1

3.5

2.1

2.2

3.9

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

8.8

12.6

14.4

13.8

12.2

13.6

1Q06

2Q06

3Q 06

4Q 06

1Q 07

2Q 07

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

)

Source: AC&M Consulting

41%

44%

47%

55%

51%

48%

50%

49%

45%

46%

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

VIP

K'Cell

Others

Financial Highlights: Kazakhstan

Net Revenues, $ mln

OIBDA, $ mln

CAPEX, $

mln

CAPEX / Revenue, LTM

+85.5%

149

119

112

104

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

+136.9%

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

80.9%

69.3%

64.2%

50.2%

41.2%

37.3%

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

Operating and Financial Highlights: Ukraine

Active Subscriber Base, mln

ARPU

(US$) and MOU (min)

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

CAPEX, $

mln

Net Revenues, $ mln

+291.4%

22.7

15.7

14.3

11.5

5.8

2.1

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

0.1

0.5

0.8

1.5

1.8

2.0

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

4.2

3.4

5.9

6.7

4.2

3.0

160

138

149

168

172

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

100

150

200

ARPU active base

MOU active base

Operating and Financial Highlights:

Uzbekistan

Active Subscriber Base, mln

Net Revenues, $ mln

ARPU (US$)

and MOU (min)

CAPEX,

$ mln

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

+54.0%

23.1

18.0

15.8

15.7

15.0

8.9

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

0.4

0.5

0.7

1.2

1.1

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

6.7

9.8

11.8

12.7

16.6

7.2

454

349

305

269

242

266

1Q 06

2Q 06

3Q 06

4Q 06

1Q 07

2Q 07

100

200

300

400

500

ARPU active base

MOU active base

Operating and Financial Highlights: Armenia

* The 4Q 2006

data

represent the results of operations for 1.5

months since the date of acquisition by VimpelCom

Net Revenues, $ mln

ARPU,

US$

CAPEX,

$ mln

19.8

16.9

34.2

35.2

10.5

23.1

4Q 06*

1Q 07

2Q 07

Fixed revenue

Mobile revenue

17.0

14.5

17.3

19.3

18.8

18.5

4Q 06*

1Q 07

2Q 07

Mobile ARPU active base

Fixed ARPU

4Q 06*

1Q 07

2Q 07

Active Subscriber Base, mln

0.6

0.4

0.6

0.5

4Q 06*

1Q 07

2Q 07

Fixed subscribers

Mobile active subscribers

Operating and Financial Highlights:

Georgia and Tajikistan

Georgia

•

Operations launched at the end of Q1 and are still in a start-up phase

•

Focus on roll-out and distribution network development

Tajikistan

•

Sequential rapid growth continues:

81% revenue growth

41% increase in active subscribers

•

OIBDA turned positive in Q2

•

Market share increased from 11.2% to 15.2%

Summary

•

Strong quarter-on-quarter and year-on-year growth

of financial and operating results in all markets

•

Overall business in Russia is continuing to grow

and gain efficiency

•

CIS becoming an increasingly important source of

new subscribers, demonstrating impressive revenue

growth and improvements in OIBDA margins

Questions and Answers

If you would like to ask a question, please press the star key followed by

the digit one on your touch-tone telephone.

Due

time

constraints,

ask

that

you

limit

yourselves

one

question

and one follow-up question.

If you are using a speakerphone, please make sure your mute button is

turned off to allow your signal to reach the equipment.

----------

Thank you for your interest in VimpelCom

For more information please visit www.vimpelcom.com or contact

Investor_Relations@vimpelcom.com

APPENDICES

Moldova

Population: 3.9 mln.

Penetration 38%

GDP* 2,000

Moldova

Population: 3.9 mln.

Penetration 38%

GDP* 2,000

Armenia

Population: 3.2 mln.

Acquired: Nov. 2006

Penetration 46%

GDP* 5,700

Armenia

Population: 3.2 mln.

Acquired: Nov. 2006

Penetration 46%

GDP* 5,700

Russia and CIS License Footprint

2G & 3G licenses

No VIP license

Ukraine

Population: 46.5 mln.

Acquired: Nov. 2005

Penetration 110%

GDP* 7,800

Ukraine

Population: 46.5 mln.

Acquired: Nov. 2005

Penetration 110%

GDP* 7,800

Georgia

Population: 4.5 mln.

Acquired: Jul. 2006

Penetration 47%

GDP* 3,800

Georgia

Population: 4.5 mln.

Acquired: Jul. 2006

Penetration 47%

GDP* 3,800

Azerbaijan

Population: 8.5 mln.

Penetration 44%

GDP* 7,500

Azerbaijan

Population: 8.5 mln.

Penetration 44%

GDP* 7,500

Turkmenistan

Population: 6.7 mln.

Penetration 5%

GDP* 8,500

Turkmenistan

Population: 6.7 mln.

Penetration 5%

GDP* 8,500

Uzbekistan

Population: 26.7 mln.

Acquired: Jan. 2006

Penetration 14%

GDP* 2,000

Uzbekistan

Population: 26.7 mln.

Acquired: Jan. 2006

Penetration 14%

GDP* 2,000

Tajikistan

Population: 7.1 mln.

Acquired: Dec. 2005

Penetration 20%

GDP* 1,300

Tajikistan

Population: 7.1 mln.

Acquired: Dec. 2005

Penetration 20%

GDP* 1,300

Kyrgyzstan

Population: 5.2 mln.

Penetration 27%

GDP* 2,100

Kyrgyzstan

Population: 5.2 mln.

Penetration 27%

GDP* 2,100

Kazakhstan

Population: 15.4 mln.

Acquired: Sept. 2004

Penetration 64%

GDP* 9,400

Kazakhstan

Population: 15.4 mln.

Acquired: Sept. 2004

Penetration 64%

GDP* 9,400

*GDP (PPP), $ per capita

Sources: GDP data by CIA World Factbook

Population data by CIS Statistics Committee

Number of mobile subscribers by AC&M-Consulting

Belarus

Population: 9.7 mln.

Penetration 66%

GDP* 7,800

Belarus

Population: 9.7 mln.

Penetration 66%

GDP* 7,800

Russia

Population: 142.2 mln.

Penetration 113%

GDP* 12,100

Russia

Population: 142.2 mln.

Penetration 113%

GDP* 12,100

Russia

2G license only

3G license only

Reconciliation Tables of non-U.S. GAAP Measures to

Their

Most Directly Comparable U.S. GAAP Financial

Measures

Reconciliation of OIBDA and OIBDA Margin

(Unaudited)

($'000)

June 30,

2007

March 31,

2007

Dec 31,

2006

Sept 30,

2006

June 30,

2006

March 31,

2006

OIBDA

896,758

766,417

689,825

717,796

561,555

482,607

Depreciation

(285,365)

(269,172)

(265,086)

(243,593)

(194,845)

(171,094)

Amortization

(53,807)

(53,289)

(50,095)

(45,648)

(43,148)

(40,955)

Operating Income

557,586

443,956

374,644

428,555

323,562

270,558

OIBDA margin

52.2%

51.5%

47.5%

52.8%

50.1%

51.6%

Less: Depreciation as % of net

operating revenues

(16.6%)

(18.1%)

(18.3%)

(17.9%)

(17.4%)

(18.3%)

Less: Amortization as % of net

operating revenues

(3.1%)

(3.6%)

(3.4%)

(3.9%)

(4.4%)

Operating Income

32.5%

29.8%

25.8%

31.5%

28.8%

28.9%

Reconciliation of OIBDA margin to operating income as percentage

net operating revenue

Reconciliation of OIBDA to operating income

Three months ended

Reconciliation of OIBDA and ARPU

in Russia (Unaudited)

($'000)

June 30,

2007

March 31,

2007

Dec 31,

2006

Sept 30,

2006

June 30,

2006

March 31,

2006

OIBDA

779,828

676,476

645,144

666,354

529,704

462,337

Depreciation

(240,387)

(232,681)

(229,544)

(221,973)

(182,684)

(161,936)

Amortization

(28,478)

(28,536)

(27,091)

(26,429)

(25,657)

(24,977)

Operating Income

510,963

415,259

388,509

417,952

321,363

275,424

Service revenue and

connection fees

1,457,896

1,276,754

1,276,276

1,223,681

1,014,810

864,767

Less: Connection fees

164

169

308

410

622

404

Less: Revenue from rent of

fiber-optic channels

983

964

433

760

325

328

Service revenue used to

calculate ARPU

1,456,749

1,275,621

1,275,535

1,222,511

1,013,863

864,035

Average number of active

subscribers ('000)

39,359

39,021

39,102

38,365

37,733

36,784

ARPU (US$)

12.3

10.9

10.6

9.0

7.8

Reconciliation of OIBDA to operating income

Reconciliation of ARPU to service revenue and connection fees

Three months ended

Reconciliation of OIBDA and ARPU

in Kazakhstan (Unaudited)

($'000)

June 30,

2007

March 31,

2007

Dec 31,

2006

Sept 30,

2006

June 30,

2006

March 31,

2006

OIBDA

80,317

62,007

35,744

49,023

33,908

21,907

Depreciation

(17,537)

(15,817)

(21,142)

(17,981)

(9,363)

(7,672)

Amortization

(9,419)

(9,154)

(9,134)

(9,550)

(9,324)

(8,785)

Operating Income

53,361

37,036

5,468

21,492

15,221

5,450

Service revenue and

connection fees

149,326

119,399

112,963

104,208

80,301

54,382

Less: Connection fees

Less: Revenue from rent of

fiber-optic channels

Service revenue used to

calculate ARPU

149,326

119,399

112,963

104,208

80,301

54,382

Average number of active

subscribers ('000)

3,655

3,271

2,728

2,412

2,120

2,070

ARPU (US$)

13.6

12.2

13.8

14.4

12.6

8.8

Reconciliation of OIBDA to operating income

Reconciliation of ARPU to service revenue and connection fees

Three months ended

Reconciliation of ARPU in Ukraine and

Uzbekistan (Unaudited)

($'000)

June 30,

2007

March 31,

2007

Dec 31,

2006

Sept 30,

2006

June 30,

2006

March 31,

2006

UKRAINE

Service revenue and

connection fees

23,436

16,158

14,652

12,320

5,948

2,103

Less: Connection fees

Less: Revenue from rent of fiber-

optic channels

Service revenue used to

calculate ARPU

23,400

16,153

14,647

12,317

5,948

2,103

Average number of active subscribers

('000)

1,847

1,781

1,170

611

338

208

ARPU (US$)

4.2

3.0

4.2

6.7

5.9

3.4

UZBEKISTAN

Service revenue and

connection fees

24,009

18,778

16,446

16,279

15,507

9,207

Less: Connection fees

Less: Revenue from rent of fiber-

optic channels

Service revenue used to

calculate ARPU

24,009

18,778

16,446

16,279

15,507

9,207

Average number of active subscribers

('000)

1,109

930

558

458

406

185

ARPU (US$)

7.2

6.7

9.8

11.8

12.7

16.6

Reconciliation

ARPU

service

revenue

and

connection

fees

Three

months

ended

Reconciliation of ARPU in Armenia

(Unaudited)

($'000)

June 30,

2007

March 31,

2007

Dec 31,

2006

June 30,

2007

March 31,

2007

Dec 31,

2006

Service revenue and

connection fees

23,208

19,912

10,451

35,214

34,242

16,922

Less: Connection fees

129

Less: Revenue from rent of fiber-

optic channels

Service revenue used to

calculate ARPU

23,189

19,783

10,451

35,159

34,242

16,922

Average number of active

subscribers ('000)

446

456

409

608

607

609

ARPU (US$)

17.3

14.5

17.0

19.3

18.8

18.5

Three Months Ended

Reconciliation of ARPU to service revenue and connection fees

MOBILE

FIXED

Definitions

Registered

subscriber

authorized

user

cellular

services,

using

one

SIM

card

(GSM/3G)

with

one

several

selective numbers or one handset (DAMPS/CDMA) with one selective

number. The number of subscribers includes

employees using cellular services and excludes guest roamers and

users of test SIM cards or handsets.

Active

subscribers

are

those

subscribers

the

registered

subscriber

base

who

were

party

revenue

generating

activity in the past three months and remain in the base at the end of the reported period. Such activities include all

incoming and outgoing calls, subscriber fee accruals, debits related to service, outgoing SMS, MMS, data transmission

and receipt sessions, but do not include incoming SMS and MMS sent by our Company or abandoned calls.

ARPU

(Monthly Average Revenue per User), a non-U.S. GAAP financial measure, is calculated by dividing the

Company’s service revenue during the relevant period, including roaming revenue and interconnect revenue, but

excluding revenue from connection fees, sales of handsets and accessories and other non-service revenue, by the average

number of the Company’s active subscribers during the period and dividing by the number of months in that period.

Reconciliation of ARPU to service revenues and connection fees, the most directly comparable U.S. GAAP financial

measure, is presented above in the tables section. The Company believes that ARPU provides useful information to

investors because it is an indicator of the performance of the Company’s business operations and assists management in

budgeting. The Company also believes that ARPU provides management with useful information concerning usage and

acceptance of the Company’s services. ARPU should not be viewed in isolation or an alternative to other figures

reported under U.S. GAAP.

MOU

(Monthly Average Minutes of Use per User) is calculated by dividing the total number of minutes of usage for

incoming and outgoing calls during the relevant period (excluding guest roamers) by the average number of active

subscribers during the period and dividing by the number of months in that period.

Market share

of subscribers for each country is calculated by dividing the estimated number of the subscribers of a

particular company by the total estimated number of subscribers in that country. Market share data is published by

consulting agencies specializing in the telecommunications industry in Russia and the CIS and generally based on

registered subscribers.

Net debt

is calculated as a total interest-bearing debt minus cash and cash equivalents

Free

cash

flow

calculated

operating

cash

flow

minus

capital

expenditures

before

acquisitions