Bezeq Israeli Telecommunication Co. Ltd. (TASE: BEZQ) has published its results for the second quarter, which reflect the expected effects of revenue decline in its DBS Satellite Services (1998) Ltd. (YES), Bezeq International, and Pelephone Communications Ltd. subsidiaries. Bezeq's revenue fell from $2.46 billion in the second quarter of 2017 to NIS 2.33 billion in the second quarter of 2018, a 5.3% decrease. The value of Pelephone's activity dropped by NIS 1.5 billion to NIS 3.9 billion, as of the end of the second quarter, as reported yesterday by "Globes."
Bezeq's operating profit declined from NIS 573 million in the second quarter last year to NIS 371 million in the second quarter this year, a 35.3% decrease. EBITDA was down 8.9% to NIS 908 million, reflected a 40.5% EBITDA rate. EBITDA was affected by implementation of the IFRS1 standard.
Bezeq's free cash flow plummeted 74.9% to NIS NIS 122 million. The decline was attributable mainly to lower profit margins and timing differences resulting from payments in respect of the sale of the Sakia compound at Mesubim Junction, while the proceeds from the sale of the property have not yet been recognized. Net profit in the second quarter was down 45.5% to NIS 195 million, mainly as a result of lower revenue and an NIS 80 million provision for retirement of employees.
Bezeq's board of directors decided to distribute a NIS 318 million dividend under the company's new policy of distributing 75% of its profit as a dividend.
Yes posted a net gain of 2,000 subscribers in the second quarter. As reported by "Globes," the company slashed its price to NIS 199, thereby halting its losses of subscribers.
Published by Globes [online], Israel business news - www.globes-online.com - on August 23, 2018
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