HOT Telecommunication Systems Ltd. (TASE: HOT) is paying the price of competition: the company's second quarter financial statements released this morning show a 44% plunge in profits to NIS 36 million, from NIS 64 million in the corresponding quarter of 2017.
Revenue in the second quarter totaled NIS 1,028 million, which compares with NIS 1,049 million in the second quarter of last year. The 2% decline stems from a fall in revenue from cable services, offset by a rise in revenue from mobile services.
Operating profit was NIS 108 million, which compares with NIS 149 million in the second quarter last year, representing a fall of 28%.
EBITDA was NIS 382 million (37% of revenue), NIS 47 million below the EBITDA figure for the second quarter last year.
Hot claims the fastest average surfing speed for customers using its Internet infrastructure, at 104.5 Mb. Hot Mobile saw an 8% rise in revenue from the corresponding quarter of 2017, stable ARPU, and a decline in subscriber numbers.
These are the last financial statements that Hot will publish in the framework of its reports to its bondholders in Israel.
Hot CEO Tal Granot-Goldstein said, "Hot continues to lead the market amid growing competition, and registered a dramatic 50% drop in the churn rate of its television subscribers in comparison with the previous quarter. Reducing the rate people unsubscribing from our television service indicates both confidence in the company and customer satisfaction with its range of services.
"In the coming quarter we shall deepen our cooperation with Netflix, and their services will be available from over half a million set-top boxes. We also recently announced that because of the strength of the Hot brand among consumers, we shall keep the brand name, and in the coming quarter we shall present a new branding language integrated with the language of the parent group Altice.
Published by Globes [online], Israel business news - www.globes-online.com - on August 2, 2018
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