Ahead of the publication of its full year financials next week, Israel’s Bezeq has lowered its profit estimate for FY 2017, citing a lower valuation for its satellite TV business, Reuters reports. The operator now expects net profit of around ILS1.2 billion (USD345 million) for last year, down from a previous forecast of ILS1.4 billion, while it has also reduced its guidance for EBITDA from ILS4.0 billion to ILS3.8 billion. It has, however, raised its estimate for free cash flow to ILS2.1 billion, from ILS2.0 billion. The revisions came after an external audit found that the value of satellite television business YES was lower than the company’s books.
The profit warning comes just a few days after the operator’s CEO Stella Handler confirmed she will resign on 1 July amid an ongoing police investigation. The executive was arrested last month in connection with an investigation into allegations that included fraud, bribery and securities offences, and while she was released from police custody it is understood that a court ordered her to stay away from Bezeq for 30 days. Alongside Handler, Bezeq’s controlling shareholder and former chairman Shaul Elovitch, as well as several other officials connected to the telco, were arrested, though all have denied any wrongdoing.