Bezeq’s revenues fall by 4.2% in 2019

20 Mar 2020

Israeli communications provider Bezeq has published its financial results for the year ended 31 December 2019, highlighting that its performance has been impacted by four extraordinary items, namely: a write-off of the tax asset in respect of losses at satellite TV provider ‘yes’ totalling ILS1.166 billion (USD306 million); an impairment loss in Pelephone assets of ILS951 million; an impairment loss in Bezeq International assets of ILS102 million; and capital gains of ILS403 million for the sale of the ‘Sakia’ property complex.

For the year under review Bezeq generated a total turnover of ILS8.929 billion, representing a year-on-year decline of 4.2%, with revenues falling in ‘all key Group segments’. Total fixed line revenues stood at ILS4.073 billion, down from ILS4.193 billion in 2018, with the two largest contributors being broadband and internet services (ILS1.578 billion, down from ILS1.596 billion) and telephony services (ILS1.039 billion, down from ILS1.156 billion), respectively. Mobile subsidiary Pelephone, meanwhile, reported total revenues of ILS2.362 billion in 2019, down from ILS2.443 billion a year earlier, with service revenues declining by 2.6% y-o-y to ILS1.709 billion.

Bezeq’s reported EBITDA in 2019 stood at ILS2.90 billion, a significant increase compared to the ILS1.64 billion recorded a year earlier, though after adjusting for the impact of impairment losses as well as other income/expenses, adjusted EBITDA was ILS3.73 billion, down from ILS3.95 billion in 2018. Meanwhile, Bezeq saw a net loss of ILS1.09 billion in 2019, broadly unchanged from a net loss of ILS1.07 billion the previous year, ‘primarily influenced by the aforementioned write-off of the tax asset in connection with yes’ losses, changes in loss from impairment of assets as well as changes in other operating expenses/income’.

In operational terms, at 31 December 2019 Bezeq had 1.718 million fixed voice lines on its books, down from 1.818 million a year earlier, while total broadband internet lines (retail and wholesale) dropped to 1.575 million, down from 1.656 million at end-2018. In the mobile arena, Bezeq reported that Pelephone’s subscriber base increased to 2.336 million at the end of 2019, up almost 6%on an annualised basis.