Page 114 - RusRPTDec19

(vs. 26% y/y in 2Q19), respectively. Software&Hi-Tech and Life Science&Healthcare revenues growth rates remained strong, at 23% y/y and 50% y/y in 3Q19, respectively. The 3Q19 revenue growth was partially boosted by a different schedule of revenue recognition (related to Financial Services revenue in the CIS) vs. the previous year. According to the company, around $3mn was recognised in 3Q19, while based on the traditional pattern, EPAM would have recognised this amount in the fourth quarter. This partly explains the guided slowdown of the revenue growth in 4Q19 along with the relatively high base effect. In particular, EPAM expects that its 4Q19 revenue will increase at least 22% y/y. Management also said that all acquisitions might contribute about 1% to the revenue growth rate in 4Q19. Management also expects to see a top line growth rate in excess of 20% in 2020F and beyond.
Belarusian software developer EPAM announced the acquisition of NAYA Technologies, headquartered in Israel, and its US subsidiary​, NAYA Tech. NAYA focuses on cloud migration, data platform architecture design and database implementation. It helps clients to adopt cloud-native database technologies. Under the deal, EPAM is also acquiring NAYA Tech product migVisor, an automated database migration assessment tool for heterogeneous and lift-and-shift cloud migrations (moving an application and its data to a cloud platform without redesign). It scans a client’s databases, identifies attributes and proprietary features, and informs the client about the fastest path to migrate the databases to cloud-native database solutions.
9.2.8​ Telecoms corporate news
Norwegian telecom major Telenor has completed its pull out from Russian mobile operator Veon (​former Vimpelcom​), selling its last 157mn shares in the company for $362mn. As reported by ​bne IntelliNews,​ in 2015 Telenor lost the legal battle for control in Vimpelcom​ with Alfa Group of Russian oligarch Mikhail Fridman, and ​decided to gradually sell its 33% stake in the company as of 2016​. Previously this year ​Telenor already sold 100mn shares in Veon​, or 5.7% of its share capital at $2.16 per ADS.
Russian mobile major ​Veon​ (former Vimpelcom) posted revenue decline of 4% year-on-year under IFRS to $2.2bn in 3Q19, ​with Ebitda up by 1% to $0.9bn. The company missed analysts’ expectations by 2%-3%, with the main negative effect coming from tax restoration in Pakistan operations. “Key factors of EBITDA performing ahead of revenue and increasing in dollar terms were EBTDA increase in Russia and Ukraine, lower EBITDA loss on HQ level, as well as the better y/y currency performance,” BCS Global Markets commented on November 4. Veon revenue performance in Russia was weak with mobile services down 2% in ruble terms (accelerating decline from 1% in 2Q19). But EBITDA still grew 3.5% y/y supported by low comparison base of 3Q18. Strong performance continued in Ukraine where Veon upped revenue and EBITDA grew respective 18% and 28% in hryvnia terms – strong performance continued. In other territories, Algeria unit’s number were weak again, while that in Bangladesh were mixed with revenue seem to be on sustainable growth track, but EBITDA impacted by increase in tax, BCS GM wrote, while maintaining a Hold recommendation for Veon at a target price of $2.8. As reported by ​bne IntelliNews,​ Veon has been making ​high profile appointments to boost its digital development profile. The company’s main shareholder, LetterOne of Mikhail Fridman is under fire ​on investigation in Spain​.
114​ RUSSIA Country Report​ December 2019 ​ ​www.intellinews.com