Cellcom Israel Ltd. (NYSE:CEL; TASE:CEL) has warned its investors against the effects of the coronavirus on the company's activity. The company notified the Tel Aviv Stock Exchange today that the halt in its roaming services caused by the ban on incoming and outgoing flights was likely to have a negative impact on its revenue. At the same time, the company warned of a halt in sales of end-user equipment. Hundreds of Cellcom employees have been put on unpaid vacation because of the situation.
Cellcom has completely stopped initiating sales by both marketers and its employees, announcing that it would not initiate any sales of services or end-user equipment. Sales will be only though self-service on Cellcom's website or when ordered by a customer by telephone.
Cellcom CEO Avi Gabbay said, "At this time, it is our duty to focus on our customers and maintain the health of the public and the company's employees, even at the cost of losing sales."
The company's announcement stated that international travel had greatly diminished as a result of the coronavirus, which had had a negative effect on its roaming services (incoming and outgoing). If this persists for a long time, the company said, it will have a substantial negative influence on its results.
Cellcom also reported that the Ministry of Communications had published instructions about the virus in Israel, including a ban on public gatherings and people leaving their homes unnecessarily. Shopping malls and other leisure institutions have been closed down, and the presence of staff in workplaces has been greatly reduced. Following these instructions, the company closed down its sales points in shopping centers and substantially cut back on its call centers. Cellcom warns that if the virus continues for a long time, it is also liable to cause a shortage of equipment, and suppliers will be unable to supply the company with devices, network equipment, spare parts, and other equipment needed to operate and upgrade the company's networks. Cellcom also reported a substantial increase in yields on its bonds.
Published by Globes, Israel business news - en.globes.co.il - on March 17, 2020
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