Partner revenues slump as competition in mobile sector prompts lower end-user prices

11 Mar 2014

Israeli mobile network operator Partner Communications has published its financial results for the twelve months ended 31 December 2013, revealing a 19% year-on-year decline in revenues.

For the year under review Partner generated a total turnover of ILS4.519 billion (USD1.302 billion), down from the ILS5.572 million it reported for FY 2012, while annual service revenues totalled ILS3.784 billion, representing a decline of 18% from ILS4.640 billion in 2012. In the cellular sector Partner recorded revenues of ILS2.907 billion, down 19% y-o-y, with the decline said to be mainly due to price erosion resulting from increased competition due to the activity of new competitors, as well as the transfer of existing customers to tariffs offering unlimited usage. Meanwhile, in the fixed line sector Partner reported revenues of ILS1.085 billion, down by 10%, with price erosion again cited as a contributory factor, and the operator also highlighting the impact of the increasing popularity of bundled services which included cellular services alongside fixed line services at ‘heavily discounted prices’.

In operational terms, for the end of December 2013 Partner reported a mobile subscriber base of 2.956 million, down from 2.976 million a year earlier, of which around 2.133 million were post-paid. An annual churn rate for cellular subscribers of 39% was reported, slightly above the 38% recorded for 2012, while average revenue per user (ARPU) in 2013 was ILS83 per month, down by 14% against ILS97 per month in 2012. Monthly average Minutes of Use per subscriber (MOU) for cellular subscribers in 2013 meanwhile stood at 522 minutes, an increase of 16% from 450 minutes in 2012, with Partner saying the increase ‘largely reflected the continued increase in the proportion of cellular subscribers with bundled packages that include large or unlimited quantities of minutes’. In the fixed line arena, Partner reported 299,000 active fixed lines at end-2013, up by 4% y-o-y, while broadband customers numbered 583,000, down from 587,000.

Israel, 012 Smile Telecom, Partner Communications Company