№1 September 2005, Moscow UTK’s strategy – increased focus on value-added services Georgy Romsky, CEO of “UTK” PJSC

№2 September 2005, Moscow Volgograd Astrakhan Rostov-on-Don Elista Stavropol Krasnodar Maikop Cherkessk Nalchik Vladikavkaz ECONOMIC Industrial output (`04) – RUR 567 bln (+28%) Well-developed business sector – 475 ths enterprises (`04) (+16.8%) Growth rate of average wages (`04) – +24.6% Volume of foreign investments in 2004 – USD 689 mln (+3.5%) Powerful production basis and developed service sector GENERAL UTK’s licensed territory ths sq km Population – 18.8 mln people High density of population – 38.6 people per one sq km Strategic geopolitical location Main health resorts of the country – great amount of tourists Compactness and high economic potential of UTK’s licensed territory

№3 September 2005, Moscow Key business highlights GENERAL UTK occupies a leading position in the Southern Russian telecommunications market Share in the fixed-line regional market (`04) – 89.4% Head count (1h 05) – 38.3 ths people NETWORK DEVELOPMENT Total installed capacity (1h 05) – 4.2 mln lines Total equipped capacity (1h 05) – 4.0 mln lines Digitization rate of local networks (1h 05) - 60% Intra-zonal network digitization rate (1h 05) - 90% FINANCIAL Revenue (`04, RAS) – RUR 16, 753 mln (+24.1%) EBITDA (`04, RAS) - RUR 4, 287 mln (+25.3%) Revenues from value-added services (`04, RAS) - RUR 882 mln (+73.4%)

№4 September 2005, Moscow UTK’s strategy is aimed at increase of its market share in the value-added regional market to at least 50% and at retention of fixed-line market share at the level of no less than 82% Further development of multi-service networks, digital cable TV, IP-telephony, Internet services Upgrade of the Company’s data networks and construction of new network nodes Organization of Call-centers and deployment of intelligent network services Introduction of a uniform billing system Technical Policy Marketing Policy Introduction of a unified tariff system for all customers and cross-subsidies reduction Introduction of flexible tariff plans for “bundling services” Introduction of additional traditional telephony services Reorganization of the Company’s sales system and optimization of its tariff policy Economic Policy: Growth in local tariffs Staff optimization and drastic costs reduction Reorganization of subsidiaries and selling of non-core businesses Optimization of the balance sheet and payables Steady improvements in UTK’s business efficiency and reliability

№5 September 2005, Moscow Capital investments, RUR mln Strengthening of the Company’s market positions allows to reduce its investment program Share of investments in the lucrative market segment for advanced technologies will be increased Traditional telephony will be funded in the amount sufficient to finish the investment projects launched in ,2% 60,8% 78,6% 21,4% 80,8% 19,2% 47,5% 51,2%

№6 September 2005, Moscow In UTK was the first among mega-regional telecom entities in terms of the subscriber base growth UTK is the first among mega-regional telecom entities in terms of intra-zonal network digitization rate UTK is the second among mega-regional telecom entities in terms of local network digitization rate Enlargement of the Company’s subscriber base contributes to revenue growth from all types of telecom services

№7 September 2005, Moscow UTK occupies a leading position in the Southern Russian telecommunications market Maintaining the Company’s positions in all segments of the fixed-line market Speeding up the development of value-added services UTK’s market share for fixed-line services

№8 September 2005, Moscow Positive trend in revenue growth compared to the UTK’s operating costs RAS IFRS Stable increase in operating profit

№9 September 2005, Moscow * EBITDA as profit before income tax, deprecations and amortization 41% 8% 25% RAS IFRS EBITDA and net profit dynamics, RUR mln

№10 September 2005, Moscow Dynamics of business efficiency indicators

№11 September 2005, Moscow Reorganization of business processes in accordance with CRM concepts Segmentation of services’ market offers Numerous subscriber base and infrastructural resources of “UTK” PJSC High growth rates of revenues from value-added services Increasing share of “UTK” PJSC in the value-added regional market UTK’s strategy – increased focus on value-added telecom services

№12 September 2005, Moscow Availability of considerable reserves for revenue increase and growing share in the regional market of value-added services Rapid development of the following services: Internet access, access to information and entertainment resources, VPN services, other services of data transmission network Market capacity growth, increase in profits from existing users, switch over of subscribers from alternative operators Dynamics of xDSL subscriber base growth

№13 September 2005, Moscow THANK YOU FOR YOUR TIME ! Any statement made or opinion expressed in the presentation by UTK, including any slides shown, are those of UTK only and not Brunswick UBS. Brunswick UBS was not involved in the preparation of these materials and Brunswick UBS assumes no responsibility for the presentation.