UPDATE 1-Russian mobile operator MTS reports 36% drop in Q2 net profit

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(Adds detail, company's comment)

MOSCOW, Aug 18 (Reuters) - Russia's biggest mobile operator MTS reported on Thursday a 36.4% drop in second-quarter net profit from the same period last year, as higher financing costs and provisions at its banking business outweighed slightly higher revenues.

The company also pointed to higher levels of depreciation and amortisation, reflecting recent capital expenditure (CAPEX).

Net profit came in at 10.9 billion roubles ($185.5 million) on revenues of 127.8 billion roubles.

Group CAPEX fell 14.6% year-on-year to 22 billion roubles, "largely due to the restrictions imposed on purchases of network equipment in 2022."

Russian businesses are adapting to challenges caused by sanctions against Moscow over the conflict in Ukraine and the subsequent impact on supply chains.

"In the second quarter of 2022, MTS largely adapted to the new macroeconomic environment," President and CEO Vyacheslav Nikolaev said in a statement published online.

"Communication services have always been and will continue to be a basic human necessity, and our primary goal remains to ensure uninterrupted network connectivity regardless of economic constraints," he said.

($1 = 58.7500 roubles) (Reporting by Alexander Marrow Editing by Mark Potter)