Bezeq posted a NIS 343 million loss in the third quarter of 2002, mostly due to the write-down of its Pele-Phone holding. Excluding this one-time expense, Bezeq posted a net profit of only NIS 11 million, compared with a net profit of NIS 86 million in the second quarter and NIS 7.8 million in the third quarter of 2001.
Bezeq lost NIS 145 million in January-September 2002, compared with a net profit of NIS 175 million in the corresponding period in 2001. Most of the difference was due to a NIS 390 million pre-tax write down for Pele-Phone. Excluding the write-down, Bezeq posted a net profit of NIS 209 million in the first nine months of the year, 19.5% higher than in the corresponding period last year.
Bezeq’s per share loss was NIS 0.060 per NIS 1 nominal value in January-September 2002 , compared with NIS 0.073 in the corresponding period last year.
Bezeq posted NIS 6.24 billion in revenue in January-September 2002, compared with NIS 6.55 billion in January-September 2001.
Bezeq posted NIS 2.13 billion in revenue in the third quarter of 2002, compared with NIS 2.05 billion in the second and NIS 2.15 billion in the third quarter of 2001.
Declining revenue from fixed-line communications in Israel, international calls and user fees were the main factors for the declining overall revenue. Revenue from international calls fell when access fees paid by international calls companies were abolished, and erosion of user fees compared with last year reduced revenue from this item. Bezeq’s falling revenue was partly offset by increased revenue from Pele-Phone.
Bezeq’s operating and general expenses totaled NIS 3.47 billion in January-September 2002, compared with NIS 3.57 billion in the corresponding period last year. Streamlining in the use of subcontractors and building maintenance, staff reductions and retirements, and cost-cutting by Bezeq International reduced Bezeq’s operating expenses.
Bezeq’s financing expenses totaled NIS 155 million in January-September 2002, compared with NIS 106 million in the corresponding period in 2001. The higher financing expenses were because Bezeq included NIS 80 million from interest on income taxes last year.
Bezeq’s equity receivable on September 30, 2002, was NIS 7.5 billion, amounting to 43.1% of its balance sheet total, compared with NIS 7.7 billion on September 30, 2001, that amounted to 42.5% of its balance sheet total.
Bezeq’s aggregate cash flow from current operations was NIS 1.896 billion in January-September 2002, compared with NIS 2.53 billion in the corresponding period last year.
Bezeq CEO Ilan Biran said Bezeq had met its working plan, its budget and its business results target. The recession, the intifada, and intense sectoral competition, had a substantial effect on Bezeq’s revenue. Biran expressed hope that the land dispute would be settled in the spirit of the cabinet decision. “Bezeq’s management believes regulation and ownership should be separated and that the company should be privatized in order for it to fulfill its potential,” he concluded.
Published by Globes [online] - www.globes.co.il - on November 27, 2002