Partner Communications Ltd. (Nasdaq: PTNR; TASE: PTNR) has recruited a respectable number of subscribers for its television services, which it launched in 2017, but the company's financial results for the year are less positive.
Partner had a tough fourth quarter, with a NIS 50 million net loss. Revenue totaled NIS 834 million, 2% more than in the fourth quarter of 2016, but NIS 65 million in one-time expenses from early repayment of a loan, while one-time revenue from taxes was only NIS 1 million, put the company into the red.
Free cash totaled NIS 63 million, 69% less than in the preceding quarter. Excluding one-time expenses and implementation of the accounting standard adopted by the company, Partner broke even in the quarter.
For the full year of 2017, Partner's revenue dropped 7.8% to NIS 3.3 billion, including recognition of NIS 108 million in revenue from the arrangement with Orange, compared with NIS 217 million in 2016. The company's 2017 profit totaled NIS 114 million, up from NIS 52 million in 2016. Excluding the effect of IFRS Standard 15, however, the reported profit is NIS 61 million.
Adjusted annual EBITDA amounted to NIS 917 million, 10% more than in 2016, also due to the accounting standards. In the mobile telephony sector, Partner's revenue from both services and equipment sales declined. Mobile telephony revenue totaled NIS 2.6 billion in 2017, 8% less than in 2016, and adjusted EBITDA rose 26%. Average revenue per user (ARPU) for mobile subscribers fell NIS 3 to NIS 62 in 2017, and the company lost 12,000 subscribers during the year, putting its total at 2.7 million. Results also deteriorated in the landline sector, a former bright spot: EBITDA fell 24% to NIS 207 million in 2017, and the decrease would have been even steeper without the effect of the IFRS standard.
"We see impressive achievements in the financial results: growth in EBITDA, 79,000 additional post-paid mobile telephony subscribers, record recruitment among households for Partner TV, and massive deployment of fiber-optic infrastructure, together with financial consolidation as a lever for the company's growth," Partner CEO Isaac Benbenisti said. "Partner TV leads the Israeli television market in subscriber recruitment by a wide margin over the competition. 29,000 more households joined Partner TV in the fourth quarter, putting the number of homes connected to the service at over 64,000, most of whom are customers who left Hot or Yes."
Published by Globes [online], Israel business news - www.globes-online.com - on March 29, 2018
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