Cellcom returns to profit in 1Q21 as revenues rise 16% y-o-y

21 May 2021

Israel’s Cellcom has published its financial results for the first quarter of 2021, reporting an almost 16% increase in revenues, and posting a quarterly profit for the first time since 2018.

For the three-month period under review Cellcom reported a total turnover of ILS1.03 billion (USD316 million), up from ILS892 million in the opening three months of 2020. Service revenues rose by 5.7% year-on-year in Q1 2021, to ILS721 million, with the company attributing the increase mainly to the consolidation of Golan Telecom’s revenues from September 2020, partially offset by a decline in service revenues from roaming services as a result of the COVID-19 pandemic. Equipment revenues, meanwhile, were up by more than 48% y-o-y at ILS312 million, driven by improved sales of equipment in the fixed line sector, as well as an increase in sales of mobile equipment to business users.

In terms of other key financial metrics, Cellcom’s operating profit totalled ILS50 million, up from ILS18 million in 1Q20, with the company saying the increase was the result of the consolidation of Golan Telecom, as well as ‘operational efficiency reflecting in a decline in expenses’. Adjusted EBITDA stood at ILS271 million in 1Q21, up from ILS244 million a year earlier, while Cellcom recorded a net profit of ILS7 million, compared to a net loss of ILS43 million in 1Q20.

Operational speaking, Cellcom reported a mobile subscriber base totalling 3.232 million as of 31 March 2021, up from 2.747 million a year earlier; it said the increase had been driven by its acquisition of Golan Telecom, with this partially offset by its exclusion from its total since 4Q20 of around 427,000 data subscribers which were producing ‘negligible’ revenue. Monthly cellular ARPU stood at ILS47.4 in 1Q21, down from ILS48.1 million y-o-y. Meanwhile, the company reported that it had 297,000 internet infrastructure customers as of 31 March 2021, up from 279,000 a year earlier, while pay-TV accesses numbered 254,000, up from 246,000.

Israel, Cellcom, Golan Telecom