Cellcom publishes third quarter results; agrees IBC co-investment deal with IIF

23 Nov 2018

Israel’s Cellcom recorded declines in most key financial indicators for the three months ended 30 September 2018, highlighting in particular that it generated a total turnover of ILS910 million (USD251 million), down from ILS975 million in the corresponding period of 2017. Service revenues, meanwhile, totalled ILS712 million in 3Q18, compared to ILS737 million the year before, of which ILS443 million was generated in the cellular sector (3Q17: ILS488 million) and ILS310 million in the fixed line sector (3Q17: ILS292 million). Meanwhile, EBITDA in the period under review was ILS184 million, representing an 18.6% year-on-year decline, with cellular EBITDA down more than 30% at ILS111 million, attributed mainly to the erosion of service revenues. Bucking the trend, however, fixed line EBITDA was up y-o-y at ILS73 million from ILS66 million, mainly due to ‘an increase in activity in the internet and TV fields’. Cellcom’s net income in 3Q18 was just ILS1 million, meanwhile, compared to ILS32 million in the year-earlier period.

In operational terms, at the end of September 2018 Cellcom had a total of 2.825 million mobile subscribers on its books, up marginally from 2.805 million a year previously, with monthly ARPU falling from ILS57.8 to ILS52.5. In the fixed line sector Cellcom reported 259,000 internet infrastructure subscribers, up 25.7% y-o-y, while it was serving a further 206,000 pay-TV customers, up from 154,000 at end-September 2017.

Alongside the publication of its financial results, Cellcom made some notable fibre-related announcements. To that end, the operator confirmed that it has entered into a memorandum of understanding with the Israel Infrastructure Fund (IIF), for the latter’s co-investment in Israel Broadband Company (IBC). According to Cellcom, IIF’s entry as an equal partner in IBC, subject to completion of the transaction, represents ‘an important step in advancing both IBC and Internet infrastructure in Israel’. With regards to the current state of Cellcom’s fibre rollout, meanwhile, the operator said that, having ‘substantially accelerated [its] independent fibre-optic deployment’, approximately 120,000 households are now within the network footprint.

Israel, Cellcom, Israel Broadband Company (IBC)