Russian operator MegaFon reported solid results for the fourth quarter and full year 2013, with its mobile data business performing strongly as it looked to improve its position in 4G.

In October, the company completed its acquisition of a 100 per cent stake in Scartel/Yota, to bolster its LTE proposition. As of 31 December, it had launched services in 49 regions of the country, covering around 36 per cent of the population.

Ivan Tavrin, CEO of the company, noted: “2013 was a year of ambitious projects for MegaFon. With the acquisition of Scartel we consolidated our leading position in mobile data, which constitutes a key advantage in a highly competitive telecommunications market and which will lead to considerable cash flow savings in network rollout and maintenance.”

The company reported a profit for the quarter of RUB10.08 billion ($279.42 million), down 45.7 per cent from RUB18.58 billion, on revenue of RUB79.73 billion, up 11.4 per cent from RUB71.59 billion.

It said that the profit decline was primarily due to the fact that the prior-year period included a one-off non-cash gain, but also reflected higher interest expenses and a revaluation of foreign currency liabilities.

Wireless revenue made up the bulk of the total – RUB69.11 billion, up 10 per cent – with data revenue at RUB15.06 billion, up 39.9 per cent.

For the full year, profit was RUB51.61 billion, up 16.3 per cent from RUB44.39 billion, on revenue of RUB297.23 billion, up 9.1 per cent from RUB272.34 billion.

It said that it saw an 8 per cent increase in wireless service revenue for the year to RUB260.46 billion, representing 87.6 per cent of its total sales.

This was driven by a “significant” increase in its subscriber base – up 8.5 per cent to 70.1 million at the end of 2013 – as well as “substantial” growth in data revenue and take-up of value added services.

The company said that the share of voice in its wireless revenue has fallen, due to faster growth of data services. At the same time, voice revenue increased by 2.7 per cent during the year to reach RUB172.74 billion.

Data revenue of RUB50.39 billion was up 28.9 per cent.

MegaFon noted that only 1.1 per cent of its consolidated revenue is attributable to subsidiaries outside of Russia.

Looking forward, it expects revenue growth in the 6 per cent to 8 per cent range.