Airat Nurutdinov is building a ‘second Tattelecom’: what led to profit growth in 2024
The annual meeting of shareholders approved the decision to allocate 50% of net profit to pay dividends
For the first time in the last five years, Tattelecom held an in-person general annual meeting of shareholders. The financial results of the telecommunications company for 2024 were recognized as successful. With revenue of 9.5 billion rubles, Tattelecom received a net profit of 1.6 billion rubles, half of which was decided to be used to pay dividends for 2024. One of the news items was the announcement of the upcoming signing of a state contract with Tattelecom to create a regional automated public warning system, which will be based on the infrastructure of the company's base stations.
“Voting here is not like at a party meeting”
Tattelecom shareholders have returned to the traditional form of joint presence at the annual meeting. The entire composition of candidates from seven government officials and top managers nominated to the board of directors of Tattelecom arrived for the general meeting at the Saydash CultureCentre. Chairman of the Board of Directors of the previous convocation and CEO of Svyazinvestneftekhim Valery Sorokin recalled that the practice of publicly announcing the results was suspended in 2020 due to the announcement of the pandemic, after which the moratorium lasted for several more years.
“I hope that there will be no more upheavals and we will be able to meet as always, — he noted and added that convening the annual meeting in an open form became possible on the recommendation of the federal legislator.”
Currently, closed joint-stock companies are still allowed to hold reporting meetings in absentia, but not public ones. Especially when considering key issues of electing the board of directors, approving the annual financial statements and distributing profits.
Tattelecom shareholders were invited to sum up the results of 2024. Their number has grown to 17 thousand people over the past three years, but in fact there were no more than 30-40 people in the hall. Minority shareholders will not be able to influence the outcome of the vote, since they hold several percent of the shares. As Valery Sorokin noted, voting here is not like at a party meeting, but in a cumulative way. Currently, 87.2% of Tattelecom shares belong to the state holding Svyazinvestneftekhim, another 2.2% belong to Tvoi Mobile Technologies, a subsidiary of Tattelecom.
“We cannot sharply raise tariffs Tattelecom: what is holding back profitability”
Tattelecom CEO Airat Nurutdinov announced the company's main financial results for 2024 (excluding the consolidated group). Revenue amounted to 9.5 billion rubles, showing an increase of 7.8%. Net profit increased by 15.9% at once — to 1.6 billion rubles. At the same time, profitability showed an increase of 1.2%. “This imbalance (the difference in the growth rates of revenue and profit) is due to the fact that the company placed a deposit,” explained Airat Nurutdinov. It can be assumed that the company received considerable income from a bank deposit at a high interest rate.
The company's subscriber base has grown to 700,000 users. “We have reversed the trend of a decrease in the subscriber base, which was observed in 2016-2018,” Nurutdinov explained.
Summarizing the results, the head of Tattelecom noted that the company's profitability is constrained by low tariffs for services. “The company cannot sharply raise tariffs, so the growth of expenses outpaces the growth of tariffs,” he said. Indeed, in the conditions of intense competition with the “big four,” Tattelecom is forced to remain in the existing price corridor. But overall, 2024 was a successful year, Airat Nurutdinov concluded.
Three sources of growth
At the meeting, it also became known that Tattelecom is preparing to sign a state contract for the creation of a regional automated public notification system. It will consist of 1,500 sirens that will transmit emergency messages about emergencies to city residents. According to Airat Nurutdinov, the infrastructure of Tattelecom base stations was chosen for its deployment, since it is cheaper. It is expected that the construction of the system will begin this year.
What ensured the growth in profits? Despite a significant increase in the cost of services, Tattelecom increased investments in key projects, which it has been carrying out in advance over the past four years.
Firstly, the construction of the GPON network continued. From 2020 to 2024, the capacity of ports, which allows access to high-speed Internet, increased for 375 thousand households. Technical capabilities are capable of covering 98% of the population of Tatarstan with a fibre-optic communication line. Currently, 150,000 people are connected to it.
“But the network is comparable in its potential to the ‘second Tattelecom,’” Nurutdinov assessed the scale (but the higher the coverage, the lower the profitability of connecting remote villages). “Here we are faced with the fact that connection is becoming unprofitable. It is difficult to extend networks to villages where people live in 5-10 houses, while we can stay within the [price] corridor.”
Secondly, the coverage of the territory is expanding video surveillance to improve the safety of residents. Last year, over 2,500 external video surveillance cameras were installed in public places and municipal children's institutions of the republic. Thus, over a thousand cameras additionally appeared in city courtyards as part of the Safe Yard project. The total coverage has increased to almost 17,000 cameras. Installation is carried out at the request of management companies and homeowners' associations.
A thousand cameras started working in public places as part of the Safe City project, which is financed by the federal and local budgets by order of the Ministry of Internal Affairs. Another 536 cameras were installed under the Safe Home project. As a result, the company services over 35 thousand video surveillance cameras (an increase of 3,100 cameras, 9% year-on-year).
Thirdly, Tattelecom is developing IP intercom. Its capacity is 15,000 digital panels, which cover 370,000 apartments in 2,600 apartment buildings of the republic. But not everything is smooth here. In Naberezhnye Chelny, the level of implementation reached 93%, and in Kazan — 12%. The reason for the sharp change in the behaviour of the management companies: they are in no hurry to submit applications, and the operator itself cannot come and install the equipment. Tattelecom cannot independently install IP telephony in every residential building. According to the norms of the Housing Code of the Russian Federation, citizens must express their desire by voting for at a general meeting of residents with a quorum, and then the management company has the right to send an application to the operator.
In addition, last year the company launched two large-scale projects to replace the billing system and the mobile communications core. The projects will implement new opportunities for subscribers and automate business processes in the company. Tattelecom also continues to build its own data centre, which will store and process data from the information systems of the enterprise and other organizations.
At the end of the shareholders' meeting, the recommendation of the Tattelecom board of directors to pay dividends in the amount of 50% of the company's net profit for the past year was approved. Almost 800 million rubles will be allocated for the payment of dividends.