Partner Communications Ltd. (Nasdaq: PTNR; TASE: PTNR) today published its financial report for the third quarter of 2009. Net profit was NIS 263 million ($70 million) for the third quarter, 20.3% less than the NIS 330 million for the corresponding quarter of 2008. Leader Capital Markets had expected a net profit of NIS 290 million.
Revenue fell 3.3% to NIS 1.58 billion ($419 million) for the third quarter from NIS 1.63 billion for the corresponding quarter. Revenue was in line with forecasts of NIS 1.58 billion revenue.
Earnings before interest, taxes, depreciation and amortization (EBITDA) fell 10.9% to NIS 570 million ($152 million) for the third quarter from NIS 640 million for the corresponding quarter. Cash flow from operating activities net of investing activities fell 35.1% to NIS 301 million ($80 million) from NIS 464 million.
Service revenue fell 1.3% to NIS 1.39 billion ($370 million) for the third quarter from NIS 1.45 billion for the corresponding quarter. Partner attributed the decline to lower outgoing voice revenue, due to competitive market conditions, resulting in lower tariffs, and the Ministry of Communications-mandated reduction in the billing interval. An additional factor was lower roaming activity.
Partner also announced that it will distribute a dividend of NIS 1.94 per share, amounting to NIS 300 million, on its third quarter profit. The company is also considering a capital reduction in order to distribute a one-time dividend of over NIS 1 billion, during the first quarter of 2010.
The higher dividend was expected after Scailex Corporation (TASE: SCIX; Pink Sheets:SCIXF), controlled by Ilan Ben-Dov, acquired the controlling interest in Partner in August for NIS 5.29 billion. To secure the financing, beyond Scailex's cash reserves, bank financing, and the sale of Partner shares to institutional investors, it was clear that Ben-Dov would want to obtain as large as possible dividends from the company to help finance the takeover. Market assessments are now being confirmed.
Partner added a net 64,000 new subscribers during the third quarter, pushing the number of subscribers to over the three million mark. Rival Pelephone Communications Ltd., whose results were included in the financial report published last week by its parent, Bezeq The Israeli Telecommunication Co. Ltd. (TASE: BEZQ), added a net 27,000 new subscribers during the third quarter, pushing the number of subscribers to 2.72 million.
Partner's share closed at $19.10 on Nasdaq on Friday, giving a market cap of $2.94 billion. The share fell 0.6% by mid-afternoon on the TASE to NIS 70.40.
Published by Globes [online], Israel business news - www.globes-online.com - on November 9, 2009
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