MTS H1 net profit up 8.3x, but one-offs drive the surge

In H1 2026, MTS net profit reached RUB 74.0 bn versus RUB 9.0 bn a year earlier (+734.9%). The increase is driven by operational efficiency and likely one-offs, while H1 operating cash flow was not disclosed.

Key figures, RUB bn

What the report showed and what drives it

MTS revenue for H1 2026 increased 11.8% YoY to RUB 414.7 bn (calculated: 201.3 + 213.5). In Q2 2026, growth accelerated to 9.2% YoY (quarter vs same quarter a year earlier), below Q1's +14.7% but still double-digit. The main driver remains the telecom segment: in Q2, segment revenue grew 14.7% YoY to RUB 130.3 bn, with B2O (interconnect) surging 33.7% to RUB 22.9 bn. Fintech also contributed: Q2 segment revenue reached RUB 42.0 bn (+18.4% YoY).

Margins and costs

EBITDA for H1 2026 increased 17.1% YoY to RUB 159.3 bn (calculated: 74.7 + 84.6), with EBITDA margin expanding from 36.7% to 38.4%. In Q2 2026, EBITDA reached RUB 84.6 bn versus RUB 72.7 bn a year earlier, reflecting operating leverage. Operating profit in Q2 rose to RUB 48.2 bn from RUB 39.4 bn a year earlier. Net profit for H1 amounted to RUB 74.0 bn (calculated: 7.2 + 66.9), yielding a net margin of 17.9% versus 2.4% a year earlier — a jump likely driven by one-offs rather than operations alone.

Debt, cash flow, capex

Net debt at the end of Q2 2026 stood at RUB 651.9 bn, up RUB 29.7 bn from the previous reporting date and RUB 98.4 bn higher than a year ago. Net debt to EBITDA for the last twelve months is 2.14x. Operating cash flow for H1 was not disclosed, but for the last twelve months it reached RUB 274.4 bn. Capex in Q2 2026 was RUB 31.6 bn, lower than RUB 44.3 bn in Q1 but higher than RUB 11.8 bn a year earlier. Rising debt while the ratio stays stable suggests cash accumulation, possibly for dividends.

Valuation and what to watch next quarter

EV/EBITDA for the last twelve months is 3.27x, below the three-year average of 4.07x — the stock trades at a discount to its own history. P/E for the last twelve months is 3.26x, reflecting high profitability but also potential one-offs. Dividend yield for the last twelve months is 15.4%. In the next report, watch for operating cash flow dynamics (not disclosed for H1), sustainability of B2O and fintech growth, and whether net margin stays above 10% without one-offs.

Valuation on the latest reported figures