Russian mobile telecommunication company, Mobile TeleSystems (also known as MTS), dived into a first quarter loss, after values of local currencies diminished, but the loss was slighter than forecast as steady user spending aided.

“The changes in the foreign exchange rates impacted our US dollar-denominated results that led to a decline in the company''s main US dollar-based financial indicators, however, the stable financial position of MTS allows us to continue to execute on our business development strategy,” said Mikhail Shamolin, president and CEO of Mobile TeleSystems (MTS).

It reported a net loss of $57.7 million for the first quarter ended March 31, 2009, as against $610.2 million net income for the same period last year.

MTS in a statement said that its revenues for the Q1 fell 24 percent to $1.81 billion from $2.38 billion in the first quarter of 2008. Its net operating income was down 34.1 percent to $464.2 million in the first quarter of 2009 from $704.6 million in the same period of 2008.

The company’s foreign exchange losses amounted to $462 million, as the local currencies of its key markets, Russia and Ukraine fell against dollar.

Operating income before depreciation and amortization or OIBDA for the first quarter of 2009 declined 29.3 percent to $831.5 million from $1.17 billion in the same quarter of the previous year.

The company also said the monthly average revenue per user (ARPU) dropped in Russia to 233.5 roubles ($7.34 at current rates) from 244.6 roubles in the same year-ago period.

In Ukraine, the ARPU came in at 33.6 hryvnias ($4.40) as against 34.5 hryvnias a year ago.

“In spite of the volatile macroeconomic situation in Russia and the CIS, MTS demonstrated year-over-year revenue growth in national currencies in all of its markets of operation with the exception of Ukraine, where growth dynamics were inline with the market's overall performance,” added Shamolin.