Partner Communications Reports Fourth Quarter And Annual 2020 Results[1]
Partner Communications Company Ltd. (NASDAQ: PTNR) reported its 2020 financial results, showing total revenues of NIS 3,189 million (US$ 992 million), a decrease of 1% year-over-year. Service revenues fell 2% to NIS 2,508 million (US$ 780 million), primarily due to a decline in roaming services amid the COVID-19 pandemic. Adjusted EBITDA decreased 4% to NIS 822 million (US$ 256 million), maintaining a 26% margin. The company reported a net profit of NIS 17 million (US$ 5 million), an 11% drop. Positive growth was seen in cellular and fiber-optic subscribers, with significant subscriber additions despite market challenges.
- Increased cellular subscribers by 179,000 to 2.84 million.
- Fiber-optic subscribers grew by 63,000, totaling 139,000.
- Homes connected to fiber-optic infrastructure increased by 141,000, reaching 465,000.
- Adjusted Free Cash Flow rose by NIS 23 million, totaling NIS 72 million.
- Net debt reduced by NIS 300 million to NIS 657 million.
- Total revenues decreased by 1% from 2019.
- Service revenues declined by 2%, affected by the COVID-19 impact.
- Adjusted EBITDA fell by 4%, indicating pressure on profitability.
- Profit for the year dropped 11% to NIS 17 million.
ROSH HA'AYIN, Israel, March 25, 2021 /PRNewswire/ --
2020 Annual Highlights (compared with 2019)
- Total Revenues: NIS 3,189 million (US
$ 992 million ), a decrease of1% - Service Revenues: NIS 2,508 million (US
$ 780 million ), a decrease of2% - Equipment Revenues: NIS 681 million (US
$ 212 million ), an increase of1% - Total Operating Expenses (OPEX) 2: NIS 1,871 million (US
$ 582 million ), a decrease of1% - Adjusted EBITDA: NIS 822 million (US
$ 256 million ), a decrease of4% - Adjusted EBITDA Margin2:
26% of total revenues, unchanged from 2019 - Profit for the Year: NIS 17 million (US
$ 5 million ) a decrease of11% - Net Debt: NIS 657 million (US
$ 204 million ), a decrease of NIS 300 million - Adjusted Free Cash Flow (before interest)2: NIS 72 million (US
$ 22 million ), an increase of NIS 23 million - Cellular ARPU: NIS 51 (US
$ 16) , a decrease of11% - Cellular Subscriber Base: approximately 2.84 million at year-end, an increase of 179 thousand
- Fiber-Optic Subscriber Base: 139 thousand subscribers at year-end, an increase of 63 thousand
- Homes Connected (HC) to Partner's Fiber-Optic Infrastructure: 465 thousand at year-end, an increase of 141 thousand
- Infrastructure-Based Internet Subscriber Base: 329 thousand subscribers at year-end, an increase of 61 thousand
- TV Subscriber Base: 232 thousand subscribers at year-end, an increase of 44 thousand
Fourth quarter 2020 highlights (compared with fourth quarter 2019)
- Total Revenues: NIS 808 million (US
$ 251 million ), a decrease of3% - Service Revenues: NIS 632 million (US
$ 197 million ), a decrease of1% - Equipment Revenues: NIS 176 million (US
$ 55 million ), a decrease of11% - Total Operating Expenses (OPEX): NIS 480 million (US
$ 149 million ), an increase of3% - Adjusted EBITDA: NIS 203 million (US
$ 63 million ), a decrease of6% - Adjusted EBITDA Margin:
25% of total revenues compared with26% - Profit for the Period: NIS 5 million (US
$ 2 million ), a decrease of29% - Net Debt: NIS 657 million (US
$ 204 million ), a decrease of NIS 300 million - Adjusted Free Cash Flow (before interest): negative NIS 3 million (US
$ -1 million ), a decrease of NIS 19 million - Cellular ARPU: NIS 49 (US
$ 15) , a decrease of11% - Cellular Subscriber Base: approximately 2.84 million at quarter-end, an increase of 179 thousand since Q4 2019 and an increase of 74 thousand in the quarter
- Fiber-Optic Subscriber Base: 139 thousand subscribers at quarter-end, an increase of 63 thousand since Q4 2019 and an increase of 19 thousand in the quarter
- Homes Connected (HC) to Partner's Fiber-Optic Infrastructure: 465 thousand at quarter-end, an increase of 141 thousand since Q4 2019 and an increase of 33 thousand in the quarter
- Infrastructure-Based Internet Subscriber Base: 329 thousand subscribers at quarter-end, an increase of 61 thousand since Q4 2019 and an increase of 18 thousand in the quarter
- TV Subscriber Base: 232 thousand subscribers at quarter-end, an increase of 44 thousand since Q4 2019 and an increase of 8 thousand in the quarter
[1] The quarterly financial results are unaudited.
[2] For the definition of this and other Non-GAAP financial measures, see "Use of Non-GAAP Financial Measures" in this press release.
Partner Communications Company Ltd. ("Partner" or the "Company") (NASDAQ: PTNR) (TASE: PTNR), a leading Israeli communications provider, announced today its results for the quarter and year ended December 31, 2020.
Commenting on the results for the fourth quarter and full year 2020, Mr. Isaac Benbenisti, CEO of Partner, noted:
"In summary of the year of COVID-19 and its operational complexity, Partner was able to maintain stability in revenues and to present a net profit. During the year 2020, hundreds of thousands of subscribers joined the Company's services, in cellular, internet and television. During the past year, Partner has expanded its growth engines – in cellular with the launch of the 5G network, 'Partner 5G', in internet with the further rollout of our independent fiber-optic infrastructure, 'Partner Fiber', and in TV, the fastest growing TV service in Israel, 'Partner TV', with the deepening of our cooperation with Netflix in a unique bundled offer.
In cellular, Partner's subscriber base grew by 179 thousand cellular subscribers, net, in 2020, to total approximately 2.84 million, alongside the continued increase in customer loyalty, with the lowest churn rates for over a decade.
In 2020, we made a big leap in the Group's activity in the internet sphere, with a
In 2020, Partner TV was again the fastest growing of all television services in Israel, with 44 thousand subscribers joining, net, during the year. As of today, 'Partner TV' is enjoyed by approximately 234 thousand subscribers, most of them also customers of the Company's internet services.
At the outset of the year 2021, Partner stands in an excellent position for growth in all areas of activity, thanks to the long-term preparations we have made in recent years, which have included both a significant reduction in debt and investment in independent communications infrastructures that enable us to increase profitability."
Mr. Tamir Amar, Partner's Chief Financial Officer & VP Fiber-Optics, commented on the results:
"The steps we've taken during the year, alongside the continued subscriber growth in the cellular and fixed-line segments lessened the impact of COVID-19 on our results. In the fourth quarter and during 2020 as a whole, the positive momentum in our growth engines continued, while accelerating the rollout of our fiber-optic infrastructure. Our success this year in the 5G frequencies tender and our compliance with the milestones in the deployment of 5G sites set by the Ministry of Communications will enable us to advance the rollout and connect more and more customers to the 5G network, and gradually expand the range of advanced services offered to Partner's growing subscriber base. In addition, the Company managed to position itself in first place, together with another operator, in bidding for a deployment grant in 5G, thus benefiting from additional financial support for the continued deployment of 5G sites, in addition to our eligibility for a significant discount on frequency fees, subject to certain tender conditions.
Our cellular subscriber base increased this year by 179 thousand. The increase included 74 thousand subscribers, net, who joined in the last quarter of the year, including 25 thousand subscribers to twelve-month data package for modems provided to students by the Ministry of Education as part of their COVID-19 crisis program. The churn rate in the fourth quarter amounted to
In the fixed-line segment, our fiber-optic infrastructure already reaches more than 760 thousand households as of today. The number of Homes Connected (HC) within buildings connected to our fiber-optic infrastructure was 465 thousand at year-end 2020, an increase of 141 thousand in the year and 33 thousand in the fourth quarter. As of the end of 2020, Partner has 139 thousand fiber-optic subscribers, an increase of 63 thousand in the year, and 19 thousand in the fourth quarter. The number of fiber-optic subscribers from households within HC buildings reflects an HC penetration rate of approximately
Regarding television, the number of subscribers grew by 8 thousand in the last quarter of 2020, bringing the total increase this year to 44 thousand. As of today, the number of TV subscribers totals approximately 234 thousand. The rate of growth from the beginning of 2021 mainly reflects the temporary impact of the technical malfunction in the television broadcasts during the second week of January 2021.
As we expected, we finished the fourth quarter of 2020 with only a small decrease of
Looking ahead, the Company expects that, in the first quarter of 2021, the negative impact will continue as a result of the almost complete cessation of air travel and closure of stores for part of the quarter; however, the overall impact is not expected to differ materially from its scope in the preceding quarter.
The Adjusted Free Cash Flow (before interest and including lease payments) for 2020 totaled NIS 72 million. CAPEX totaled NIS 573 million. For the fourth quarter, the Adjusted Free Cash Flow (before interest and including lease payments) was negative and totaled approximately minus NIS 3 million, with CAPEX totaling NIS 156 million. The investments in 2020 reflect the continued efforts of the Company to expand the deployment of the fiber-optic infrastructure, for which we expect to complete the major rollout phase during the year 2023, and the continued penetration of the television market. These investments continue to be made possible as a result of Partner's financial stability and strong balance sheet, and they continue even during the challenging period of the COVID-19 crisis.
Net debt was NIS 657 million at the end of the year 2020, compared with NIS 957 million at the end of last year, a decrease of NIS 300 million, mainly reflecting the Company's successful capital raising in January 2020 in the amount of NIS 276 million, net. The Company's net debt to Adjusted EBITDA ratio stood at 0.8 at year-end 2020, which demonstrates the Company's financial strength."
Q4 2020 compared with Q3 2020
NIS Million | Q3'20 | Q4'20 | Comments |
Service Revenues | 631 | 632 | The results reflected a stability in service revenues in both the cellular and the fixed-line segments |
Equipment Revenues | 169 | 176 | The increase reflected a higher volume of equipment sales mainly in the fixed-line segment |
Total Revenues | 800 | 808 | |
Gross profit from equipment sales | 38 | 40 | |
OPEX | 475 | 480 | The increase reflected a reduction in the intensity of the cost-cutting measures compared with the previous quarter |
Adjusted EBITDA | 204 | 203 | |
Profit (loss) for the period | (5) | 5 | The increase in profit mainly reflected the decrease in finance costs, net primarily due to one-time expenses of NIS 7 million in Q3'20 |
Capital Expenditures (cash) | 147 | 156 | |
Adjusted Free Cash Flow (before interest payments) | 21 | (3) | The decrease resulted mainly from changes in operating assets and liabilities and an increase in cash used in capital expenditures |
Net Debt | 646 | 657 |
Q3'20 | Q4'20 | Comments | |
Cellular Subscribers (end of period, thousands) | 2,762 | 2,836 | Increase of 58 thousand Post-Paid subscribers (of which 25 thousand from Ministry of Education) and increase of 16 thousand Pre-Paid subscribers |
Monthly Average Revenue per Cellular User (ARPU) (NIS) | 51 | 49 | |
Quarterly Cellular Churn Rate (%) | |||
Fiber-Optic Subscribers (end of period, thousands) | 120 | 139 | Active subscribers to an end-to-end service including both Partner's fiber-optic infrastructure and access to the internet |
Homes Connected to the Fiber-Optic Infrastructure (HC) end of period, thousands) | 432 | 465 | The total number of households within buildings connected to the Partner fiber-optic infrastructure |
Infrastructure-Based Internet Subscribers (end of period, thousands) | 311 | 329 | Active subscribers to an end-to-end service including both infrastructure (either through the wholesale market on Bezeq/Hot infrastructure and or through Partner's fiber-optic infrastructure) and access to the internet |
TV Subscribers (end of period, thousands) | 224 | 232 |
Key Financial Results
NIS MILLION (except EPS) | 2016* | 2017* | 2018* | 2019 | 2020 |
Revenues | 3,544 | 3,268 | 3,259 | 3,234 | 3,189 |
Cost of revenues | 2,924 | 2,627 | 2,700 | 2,707 | 2,664 |
Gross profit | 620 | 641 | 559 | 527 | 525 |
S,G&A and credit losses | 689 | 465 | 471 | 468 | 459 |
Income with respect to settlement agreement with Orange | 217 | 108 | |||
Other income | 45 | 31 | 28 | 28 | 30 |
Operating profit | 193 | 315 | 116 | 87 | 96 |
Finance costs, net | 105 | 180 | 53 | 68 | 69 |
Income tax expenses | 36 | 21 | 7 | 0 | 10 |
Profit for the year | 52 | 114 | 56 | 19 | 17 |
Earnings per share (basic, NIS) | 0.33 | 0.70 | 0.34 | 0.12 | 0.09 |
* The Company adopted IFRS 15 from the beginning of 2017 and IFRS 16 from the beginning of 2019. For more information see the Company's Annual Report on Form 20-F for the year ended December 31, 2020.
NIS MILLION (except EPS) | Q4'19 | Q1'20 | Q2'20 | Q3'20 | Q4'20 |
Revenues | 834 | 807 | 774 | 800 | 808 |
Cost of revenues | 693 | 655 | 653 | 677 | 679 |
Gross profit | 141 | 152 | 121 | 123 | 129 |
S,G&A and credit losses | 116 | 122 | 108 | 111 | 118 |
Other income | 5 | 6 | 7 | 8 | 9 |
Operating profit | 30 | 36 | 20 | 20 | 20 |
Finance costs, net | 20 | 19 | 13 | 24 | 13 |
Income tax expenses | 3 | 7 | 0 | 1 | 2 |
Profit (Loss) for the period | 7 | 10 | 7 | (5) | 5 |
Earnings (Loss) per share (basic, NIS) | 0.05 | 0.05 | 0.04 | (0.03) | 0.03 |
NIS MILLION (except EPS) | Q4'19 | Q4'20 | % Change |
Revenues | 834 | 808 | - |
Cost of revenues | 693 | 679 | - |
Gross profit | 141 | 129 | - |
Operating profit | 30 | 20 | - |
Profit for the period | 7 | 5 | - |
Earnings per share (basic, NIS) | 0.05 | 0.03 | |
Adjusted Free Cash Flow (before interest) | 16 | (3) |
Key Operating Indicators
2016* | 2017* | 2018* | 2019 | 2020 | |
Adjusted EBITDA (NIS million) | 834 | 917 | 722 | 853 | 822 |
Adjusted EBITDA (as a % of total revenues) | |||||
Adjusted Free Cash Flow (NIS million) | 758 | 599 | 124 | 49 | 72 |
Cellular Subscribers (end of period, thousands) | 2,686 | 2,662 | 2,646 | 2,657 | 2,836 |
Estimated Cellular Market Share (%) | |||||
Annual Cellular Churn Rate (%) | |||||
Average Monthly Revenue per Cellular Subscriber (ARPU) (NIS) | 65 | 62 | 58 | 57 | 51 |
Fiber-Optic Subscribers (end of period, thousands) | 76 | 139 | |||
Homes Connected to fiber-optic network (end of period, thousands) | 324 | 465 | |||
Infrastructure-Based Internet Subscribers (end of period, thousands) | 268 | 329 | |||
TV subscribers (end of period, thousands) | 43 | 122 | 188 | 232 |
* The Company adopted IFRS 15 from the beginning of 2017 and IFRS 16 from the beginning of 2019. For more information see the Company's Annual Report on Form 20-F for the year ended December 31, 2020.
Q4'19 | Q4'20 | Change | |
Adjusted EBITDA (NIS million) | 217 | 203 | - |
Adjusted EBITDA margin (as a % of total revenues) | -1 | ||
Quarterly Cellular Churn Rate (%) | - | ||
Monthly Average Revenue per Cellular User (ARPU) (NIS) | 55 | 49 | -6 |
Partner Consolidated Results
Cellular Segment | Fixed-Line Segment | Elimination | Consolidated | ||||||||
NIS Million | 2019 | 2020 | Change % | 2019 | 2020 | Change % | 2019 | 2020 | 2019 | 2020 | Change % |
Total Revenues | 2,369 | 2,208 | - | 1,028 | 1,129 | + | (163) | (148) | 3,234 | 3,189 | - |
Service Revenues | 1,798 | 1,663 | - | 925 | 993 | + | (163) | (148) | 2,560 | 2,508 | - |
Equipment Revenues | 571 | 545 | - | 103 | 136 | + | - | - | 674 | 681 | + |
Operating Profit | 77 | 73 | - | 10 | 23 | + | - | - | 87 | 96 | + |
Adjusted EBITDA | 635 | 533 | - | 218 | 289 | + | - | - | 853 | 822 | - |
Cellular Segment | Fixed-Line Segment | Elimination | Consolidated | ||||||||
NIS Million | Q4'19 | Q4'20 | Change % | Q4'19 | Q4'20 | Change % | Q4'19 | Q4'20 | Q4'19 | Q4'20 | Change % |
Total Revenues | 610 | 551 | - | 264 | 293 | + | (40) | (36) | 834 | 808 | - |
Service Revenues | 438 | 416 | - | 238 | 252 | + | (40) | (36) | 636 | 632 | - |
Equipment Revenues | 172 | 135 | - | 26 | 41 | + | - | - | 198 | 176 | - |
Operating Profit (loss) | 30 | 27 | - | 0 | (7) | - | - | 30 | 20 | - | |
Adjusted EBITDA | 156 | 138 | - | 61 | 65 | + | - | - | 217 | 203 | - |
Financial Review
In 2020, total revenues were NIS 3,189 million (US
Annual service revenues in 2020 totaled NIS 2,508 million (US
Service revenues for the cellular segment in 2020 totaled NIS 1,663 million (US
Service revenues for the fixed-line segment in 2020 totaled NIS 993 million (US
In Q4 2020, total revenues were NIS 808 million (US$ 251 million), a decrease of 3% from NIS 834 million in Q4 2019.
Service revenues in Q4 2020 totaled NIS 632 million (US
Service revenues for the cellular segment in Q4 2020 totaled NIS 416 million (US
Service revenues for the fixed-line segment in Q4 2020 totaled NIS 252 million (US
Equipment revenues in 2020 totaled NIS 681 million (US
Gross profit from equipment sales in 2020 was NIS 145 million (US
Equipment revenues in Q4 2020 totaled NIS 176 million (US
Gross profit from equipment sales in Q4 2020 was NIS 40 million (US
Total operating expenses ('OPEX') totaled NIS 1,871 million (US
Total operating expenses ('OPEX') totaled NIS 480 million (US
Operating profit for 2020 totaled NIS 96 million (US
Adjusted EBITDA in 2020 totaled NIS 822 million (US
Adjusted EBITDA for the cellular segment was NIS 533 million (US
Adjusted EBITDA for the fixed-line segment was NIS 289 million (US
Operating profit for Q4 2020 was 20 million (US
Adjusted EBITDA in Q4 2020 totaled NIS 203 million (US
Adjusted EBITDA for the cellular segment was NIS 138 million (US
Adjusted EBITDA for the fixed-line segment was NIS 65 million (US
Finance costs, net in 2020 were NIS 69 million (US
Finance costs, net in Q4 2020 were NIS 13 million (US
Income tax expenses for 2020 were NIS 10 million (US$ 3 million), compared with no income tax expenses in 2019. In 2019, a one-time income of NIS 6 million was recorded in income tax expenses.
Income tax expenses in Q4 2020 were NIS 2 million (US
Overall, the Company's profit in 2020 totaled NIS 17 million (US$ 5 million), a decrease of
Based on the weighted average number of shares outstanding during 2020, basic earnings per share or ADS, was NIS 0.09 (US
Profit in Q4 2020 was NIS 5 million (US
Based on the weighted average number of shares outstanding during Q4 2020, basic earnings per share or ADS, was NIS 0.03 (US
Cellular Segment Operational Review
At the end of 2020, the Company's cellular subscriber base (including mobile data, 012 Mobile subscribers and M2M subscriptions) was approximately 2.84 million, including approximately 2.50 million Post-Paid subscribers or
Over the year 2020, the cellular subscriber base increased by 179 thousand subscribers. The Post-Paid subscriber base increased by 129 thousand subscribers, and the Pre-Paid subscriber base increased by 50 thousand subscribers. The increase in the Post-Paid subscriber base included approximately 25 thousand subscribers to a time-limited 12 month data package for modems provided to students by the Ministry of Education as part of their COVID-19 crisis program. As part of the same program, a further approximate 42,000 subscribers are expected to join the Post-Paid subscriber base during the first half of 2021.
Total cellular market share (based on the number of subscribers) at the end of 2020 was estimated to be approximately
The annual churn rate for cellular subscribers in 2020 was
The monthly Average Revenue Per User ("ARPU") for cellular subscribers in 2020 was NIS 51 (US
During the fourth quarter of 2020, the cellular subscriber base increased net by 74 thousand subscribers. The Post-Paid subscriber base increased by 58 thousand subscribers and the Pre-Paid subscriber base increased by 16 thousand subscribers. The increase in the Post-Paid subscriber base included approximately 25 thousand subscribers to a time-limited 12-month data package for modems provided to students by the Ministry of Education as part of their COVID-19 crisis program.
The quarterly churn rate for cellular subscribers in Q4 2020 was
The monthly Average Revenue Per User ("ARPU") for cellular subscribers in Q4 2020 was NIS 49 (US
Fixed-Line Segment Operational Review
At the end of 2020, the Company's fiber-optic subscriber base was 139 thousand subscribers, an increase, net, of 63 thousand subscribers in the year, and of 19 thousand subscribers during the fourth quarter of 2020.
At the end of 2020, the Company's infrastructure-based internet subscriber base was 329 thousand subscribers, an increase, net, of 61 thousand subscribers in the year, and of 18 thousand subscribers during the fourth quarter of 2020.
At the end of 2020, households in buildings connected to our fiber-optic infrastructure (HC) totaled 465 thousand, an increase of 141 thousand in the year, and of 33 thousand subscribers during the fourth quarter of 2020.
At the end of 2020, the Company's TV subscriber base totaled 232 thousand subscribers, an increase, net, of 44 thousand subscribers in the year, and of 8 thousand subscribers during the fourth quarter of 2020.
Funding and Investing Review
In 2020, Adjusted Free Cash Flow (including lease payments) totaled NIS 72 million (US
Cash generated from operating activities decreased by
Lease payments (principal and interest), recorded in cash flows from financing activities under IFRS 16 totaled NIS 147 million (US
Cash capital expenditures (Capex payments), as represented by cash flows used for the acquisition of property and equipment and intangible assets, were NIS 573 million (US
In Q4 2020, Adjusted Free Cash Flow (including lease payments) was negative and totaled minus NIS 3 million (US
Cash generated from operating activities totaled NIS 182 million (US
Lease payments (principal and interest), recorded in cash flows from financing activities under IFRS 16, totaled NIS 32 million (US
Cash capital expenditures (CAPEX payments), as represented by cash flows used for the acquisition of property and equipment and intangible assets, were NIS 156 million (US
The level of net debt at the end of 2020 amounted to NIS 657 million (US
Conference Call Details
Partner will host a conference call to discuss its financial results on Thursday, March 25, 2021 at 11.00 a.m. Eastern Time / 5.00 p.m. Israel Time.
Please dial the following numbers (at least 10 minutes before the scheduled time) in order to participate:
International: +972.3.918.0687
North America toll-free: +1.866.860.9642
A live webcast of the call will also be available on Partner's Investors Relations website at:
http://www.partner.co.il/en/Investors-Relations/lobby
If you are unavailable to join live, the replay of the call will be available from March 25, 2021 until April 8, 2021, at the following numbers:
International: +972.3.925.5921
North America toll-free: +1.888.326.9310
In addition, the archived webcast of the call will be available on Partner's Investor Relations website at the above address for approximately three months.
Forward-Looking Statements
This press release includes forward-looking statements within the meaning of Section 27A of the US Securities Act of 1933, as amended, Section 21E of the US Securities Exchange Act of 1934, as amended, and the safe harbor provisions of the US Private Securities Litigation Reform Act of 1995. Words such as "estimate", "believe", "anticipate", "expect", "intend", "seek", "will", "plan", "could", "may", "project", "goal", "target" and similar expressions often identify forward-looking statements but are not the only way we identify these statements. In particular, this press release communicates our belief that (i) we are in an excellent position for growth in all areas of activity and to increase profitability, (ii) we will be able to advance the rollout and connect more customers to our 5G network and gradually expand the range of services offered, and we may benefit from additional financial support for the continued deployment of 5G sites and a significant discount on frequency fees, subject to certain conditions, (iii) the overall negative impact of COVID-19 will not differ materially from its scope in the preceding quarter, and (iv) we will further expand the deployment of the fiber optic infrastructure, for which we expect to complete the major rollout phase during the year 2023, and continue to penetrate the television market. In addition, all statements other than statements of historical fact included in this press release regarding our future performance are forward-looking statements.
We have based these forward-looking statements on our current knowledge and our present beliefs and expectations regarding possible future events. These forward-looking statements are subject to risks, uncertainties and assumptions, including in particular (i) the severity and duration of the impact on our business of the current health crisis, including employee absences and disruptions in our equipment supply chain (ii) unexpected technical issues which may arise as we rollout our 5G network and expand the range of services, and as we deploy the fiber optic infrastructure, and (iii) currently unanticipated demands on our financial resources which could limit our ability to pursue our strategic objectives. In light of the current unreliability of predictions as to the ultimate severity and duration of the health crisis, as well as the specific regulatory and business risks facing our business, future results may differ materially from those currently anticipated. For further information regarding risks, uncertainties and assumptions about Partner, trends in the Israeli telecommunications industry in general, the impact of current global economic conditions and possible regulatory and legal developments, and other risks we face, see "Item 3. Key Information - 3D. Risk Factors", "Item 4. Information on the Company", "Item 5. Operating and Financial Review and Prospects", "Item 8. Financial Information - 8A. Consolidated Financial Statements and Other Financial Information - 8A.1 Legal and Administrative Proceedings" and "Item 11. Quantitative and Qualitative Disclosures about Market Risk" in the Company's Annual Reports on Form 20-F filed with the SEC, as well as its immediate reports on Form 6-K furnished to the SEC. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
The quarterly financial results presented in this press release are unaudited financial results.
The results were prepared in accordance with IFRS, other than the non-GAAP financial measures presented in the section, "Use of Non-GAAP Financial Measures".
The financial information is presented in NIS millions (unless otherwise stated) and the figures presented are rounded accordingly. The convenience translations of the New Israeli Shekel (NIS) figures into US Dollars were made at the rate of exchange prevailing at December 31, 2020: US
Use of Non-GAAP Financial Measures
The following non-GAAP measures are used in this report. These measures are not financial measures under IFRS and may not be comparable to other similarly titled measures for other companies. Further, the measures may not be indicative of the Company's historic operating results nor are meant to be predictive of potential future results.
Non-GAAP | Calculation | Most Comparable IFRS |
Adjusted EBITDA | Profit (Loss) add Income tax expenses, Finance costs, net, Depreciation and amortization expenses (including amortization of intangible assets, deferred expenses-right of use and impairment charges), Other expenses (mainly amortization of share based compensation) | Profit (Loss) |
Adjusted EBITDA | Adjusted EBITDA divided by Total revenues | |
Adjusted Free | Net cash provided by operating activities add Net cash used in investing activities deduct Proceeds from (investment in) deposits, net deduct Lease principal payments deduct Lease interest payments | Net cash provided by operating activities add Net cash used in investing activities |
Total Operating | Cost of service revenues add Selling and marketing expenses add General and administrative expenses add Credit losses deduct Depreciation and amortization expenses, | Sum of: Cost of service revenues, Selling and marketing expenses, General and administrative expenses, Credit losses |
Net Debt | Current maturities of notes payable and borrowings add Notes payable add Borrowings from banks add Financial liability at fair value deduct Cash and cash equivalents deduct Short-term and long-term deposits | Sum of: Current maturities of notes payable and borrowings, Notes payable, Borrowings from banks, Financial liability at fair value Less Sum of: Cash and cash equivalents, Short-term deposits, Long-term deposits. |
About Partner Communications
Partner Communications Company Ltd. is a leading Israeli provider of telecommunications services (cellular, fixed-line telephony, internet services and TV services). Partner's ADSs are quoted on the NASDAQ Global Select Market™ and its shares are traded on the Tel Aviv Stock Exchange (NASDAQ and TASE: PTNR).
For more information about Partner, see: http://www.partner.co.il/en/Investors-Relations/lobby
Contacts: | |
Tamir Amar | Amir Adar |
Chief Financial Officer & VP Fiber-Optics | Head of Investor Relations and Corporate Projects |
Tel: +972-54-781-4951 | Tel: +972-54-781-5051 |
E-mail: investors@partner.co.il | |
PARTNER COMMUNICATIONS COMPANY LTD. | ||||
New Israeli Shekels | Convenience | |||
December 31, | ||||
2019 | 2020 | 2020 | ||
In millions | ||||
CURRENT ASSETS | ||||
Cash and cash equivalents | 299 | 376 | 117 | |
Short-term deposits | 552 | 411 | 128 | |
Trade receivables | 624 | 560 | 174 | |
Other receivables and prepaid expenses | 39 | 46 | 14 | |
Deferred expenses – right of use | 26 | 26 | 8 | |
Inventories | 124 | 77 | 24 | |
1,664 | 1,496 | 465 | ||
NON CURRENT ASSETS | ||||
Long-term deposits | 155 | 48 | ||
Trade receivables | 250 | 232 | 72 | |
Deferred expenses – right of use | 102 | 118 | 37 | |
Lease – right of use | 582 | 663 | 206 | |
Property and equipment | 1,430 | 1,495 | 465 | |
Intangible and other assets | 538 | 521 | 162 | |
Goodwill | 407 | 407 | 127 | |
Deferred income tax asset | 41 | 29 | 9 | |
Prepaid expenses and other assets | 1 | 9 | 3 | |
3,351 | 3,629 | 1,129 | ||
TOTAL ASSETS | 5,015 | 5,125 | 1,594 | |
PARTNER COMMUNICATIONS COMPANY LTD. | ||||
New Israeli Shekels | Convenience | |||
December 31, | ||||
2019 | 2020 | 2020 | ||
In millions | ||||
CURRENT LIABILITIES | ||||
Current maturities of notes payable and borrowings | 367 | 290 | 90 | |
Trade payables | 716 | 666 | 207 | |
Payables in respect of employees | 103 | 58 | 18 | |
Other payables (mainly institutions) | 23 | 29 | 9 | |
Income tax payable | 30 | 27 | 8 | |
Lease liabilities | 131 | 120 | 37 | |
Deferred revenues from HOT mobile | 31 | 31 | 10 | |
Other deferred revenues | 45 | 100 | 31 | |
Provisions | 43 | 13 | 4 | |
1,489 | 1,334 | 414 | ||
NON CURRENT LIABILITIES | ||||
Notes payable | 1,275 | 1,219 | 379 | |
Borrowings from banks | 138 | 86 | 27 | |
Financial liability at fair value | 28 | 4 | 1 | |
Liability for employee rights upon retirement, net | 43 | 42 | 13 | |
Lease liabilities | 486 | 582 | 181 | |
Deferred revenues from HOT mobile | 102 | 71 | 22 | |
Provisions and other non-current liabilities | 37 | 64 | 21 | |
2,109 | 2,068 | 644 | ||
TOTAL LIABILITIES | 3,598 | 3,402 | 1,058 | |
EQUITY | ||||
Share capital – ordinary shares of NIS 0.01 | 2 | 2 | 1 | |
December 31, 2019 – *162,915,990 shares | ||||
December 31, 2020 – *182,826,973 shares | ||||
Capital surplus | 1,077 | 1,311 | 408 | |
Accumulated retained earnings | 576 | 606 | 188 | |
Treasury shares, at cost | (238) | (196) | (61) | |
TOTAL EQUITY | 1,417 | 1,723 | 536 | |
TOTAL LIABILITIES AND EQUITY | 5,015 | 5,125 | 1,594 | |
* Net of treasury shares.
** Including restricted shares in an amount of 1,247,583 and 1,008,735 as of December 31, 2019 and December 31, 2020, respectively, held by a trustee under the Company's Equity Incentive Plan, such shares may become outstanding upon completion of vesting conditions.
PARTNER COMMUNICATIONS COMPANY LTD. | ||||||
Convenience | ||||||
translation | ||||||
New Israeli Shekels | into U.S. dollars | |||||
Year ended December 31, | ||||||
2018** | 2019 | 2020 | 2020 | |||
In millions (except earnings per share) | ||||||
Revenues, net | 3,259 | 3,234 | 3,189 | 992 | ||
Cost of revenues | 2,700 | 2,707 | 2,664 | 829 | ||
Gross profit | 559 | 527 | 525 | 163 | ||
Selling and marketing expenses | 293 | 301 | 291 | 90 | ||
General and administrative expenses | 148 | 149 | 145 | 45 | ||
Credit losses | 30 | 18 | 23 | 7 | ||
Other income, net | 28 | 28 | 30 | 9 | ||
Operating profit | 116 | 87 | 96 | 30 | ||
Finance income | 2 | 7 | 8 | 2 | ||
Finance expenses | 55 | 75 | 77 | 24 | ||
Finance costs, net | 53 | 68 | 69 | 22 | ||
Profit before income tax | 63 | 19 | 27 | 8 | ||
Income tax expenses | 7 | * | 10 | 3 | ||
Profit for the year | 56 | 19 | 17 | 5 | ||
Attributable to: | ||||||
Owners of the Company | 57 | 19 | 17 | 5 | ||
Non-controlling interests | (1) | * | ||||
Profit for the year | 56 | 19 | 17 | 5 | ||
Earnings per share | ||||||
Basic | 0.34 | 0.12 | 0.09 | 0.03 | ||
Diluted | 0.34 | 0.12 | 0.09 | 0.03 | ||
* Representing an amount of less than 1 million.
** See report 20-F regarding the adoption of IFRS 16 – Leases, from the beginning of 2019.
PARTNER COMMUNICATIONS COMPANY LTD. | |||||
New Israeli Shekels | Convenience | ||||
Year ended December 31, | |||||
2018** | 2019 | 2020 | 2020 | ||
In millions | |||||
Profit for the year | 56 | 19 | 17 | 5 | |
Other comprehensive income, items | |||||
that will not be reclassified to profit or loss | |||||
Remeasurements of post-employment benefit | |||||
obligations | 1 | (2) | 1 | * | |
Income taxes relating to remeasurements of | |||||
post-employment benefit obligations | * | * | * | * | |
Other comprehensive income (loss) | |||||
for the year, net of income taxes | 1 | (2) | 1 | * | |
TOTAL COMPREHENSIVE INCOME | |||||
FOR THE YEAR | 57 | 17 | 18 | 5 | |
Total comprehensive income attributable to: | |||||
Owners of the Company | 58 | 17 | 18 | 5 | |
Non-controlling interests | (1) | * | |||
TOTAL COMPREHENSIVE INCOME FOR | 57 | 17 | 18 | 5 | |
* Representing an amount of less than 1 million.
** See report 20-F regarding the adoption of IFRS 16 – Leases, from the beginning of 2019.
PARTNER COMMUNICATIONS COMPANY LTD. | |||||||||||||||||
New Israeli Shekels | New Israeli Shekels | ||||||||||||||||
Year ended December 31, 2020 | Year ended December 31, 2019 | ||||||||||||||||
In millions | In millions | ||||||||||||||||
Cellular | Fixed line | Elimination | Consolidated | Cellular | Fixed line | Elimination | Consolidated | ||||||||||
Segment revenue - Services | 1,647 | 861 | 2,508 | 1,783 | 777 | 2,560 | |||||||||||
Inter-segment revenue - Services | 16 | 132 | (148) | 15 | 148 | (163) | |||||||||||
Segment revenue - Equipment | 545 | 136 | 681 | 571 | 103 | 674 | |||||||||||
Total revenues | 2,208 | 1,129 | (148) | 3,189 | 2,369 | 1,028 | (163) | 3,234 | |||||||||
Segment cost of revenues - Services | 1,272 | 856 | 2,128 | 1,367 | 810 | 2,177 | |||||||||||
Inter-segment cost of revenues - Services | 131 | 17 | (148) | 147 | 16 | (163) | |||||||||||
Segment cost of revenues - Equipment | 451 | 85 | 536 | 464 | 66 | 530 | |||||||||||
Cost of revenues | 1,854 | 958 | (148) | 2,664 | 1,978 | 892 | (163) | 2,707 | |||||||||
Gross profit | 354 | 171 | 525 | 391 | 136 | 527 | |||||||||||
Operating expenses (3) | 300 | 159 | 459 | 334 | 134 | 468 | |||||||||||
Other income, net | 19 | 11 | 30 | 20 | 8 | 28 | |||||||||||
Operating profit | 73 | 23 | 96 | 77 | 10 | 87 | |||||||||||
Adjustments to presentation of segment | |||||||||||||||||
–Depreciation and amortization | 450 | 264 | 542 | 209 | |||||||||||||
–Other (1) | 10 | 2 | 16 | (1) | |||||||||||||
Segment Adjusted EBITDA (2) | 533 | 289 | 635 | 218 | |||||||||||||
Reconciliation of segment subtotal Adjusted EBITDA to profit for the | |||||||||||||||||
Segments subtotal Adjusted EBITDA (2) | 822 | 853 | |||||||||||||||
- Depreciation and amortization | (714) | (751) | |||||||||||||||
- Finance costs, net | (69) | (68) | |||||||||||||||
- Income tax expenses | (10) | * | |||||||||||||||
- Other (1) | (12) | (15) | |||||||||||||||
Profit for the year | 17 | 19 | |||||||||||||||
* Representing an amount of less than 1 million.
PARTNER COMMUNICATIONS COMPANY LTD. | |||||||||||||||||
New Israeli Shekels | New Israeli Shekels | ||||||||||||||||
3 months ended December 31, 2020 | 3 months ended December 31, 2019 | ||||||||||||||||
In millions (Unaudited) | In millions (Unaudited) | ||||||||||||||||
Cellular | Fixed line | Elimination | Consolidated | Cellular | Fixed line | Elimination | Consolidated | ||||||||||
Segment revenue - Services | 412 | 220 | 632 | 435 | 201 | 636 | |||||||||||
Inter-segment revenue - Services | 4 | 32 | (36) | 3 | 37 | (40) | |||||||||||
Segment revenue - Equipment | 135 | 41 | 176 | 172 | 26 | 198 | |||||||||||
Total revenues | 551 | 293 | (36) | 808 | 610 | 264 | (40) | 834 | |||||||||
Segment cost of revenues - Services | 312 | 231 | 543 | 323 | 209 | 532 | |||||||||||
Inter-segment cost of revenues - Services | 31 | 5 | (36) | 36 | 4 | (40) | |||||||||||
Segment cost of revenues - Equipment | 112 | 24 | 136 | 143 | 18 | 161 | |||||||||||
Cost of revenues | 455 | 260 | (36) | 679 | 502 | 231 | (40) | 693 | |||||||||
Gross profit | 96 | 33 | 129 | 108 | 33 | 141 | |||||||||||
Operating expenses (3) | 73 | 45 | 118 | 81 | 35 | 116 | |||||||||||
Other income, net | 4 | 5 | 9 | 3 | 2 | 5 | |||||||||||
Operating profit (loss) | 27 | (7) | 20 | 30 | 0 | 30 | |||||||||||
Adjustments to presentation of segment | |||||||||||||||||
–Depreciation and amortization | 108 | 72 | 124 | 60 | |||||||||||||
–Other (1) | 3 | * | 2 | 1 | |||||||||||||
Segment Adjusted EBITDA (2) | 138 | 65 | 156 | 61 | |||||||||||||
Reconciliation of segment subtotal Adjusted EBITDA to profit for the | |||||||||||||||||
Segments subtotal Adjusted EBITDA (2) | 203 | 217 | |||||||||||||||
- Depreciation and amortization | (180) | (184) | |||||||||||||||
- Finance costs, net | (13) | (20) | |||||||||||||||
- Income tax expenses | (2) | (3) | |||||||||||||||
- Other (1) | (3) | (3) | |||||||||||||||
Profit for the period | 5 | 7 | |||||||||||||||
* Representing an amount of less than 1 million.
(1) Mainly amortization of employee share based compensation.
(2) Adjusted EBITDA as reviewed by the CODM represents Earnings Before Interest (finance costs, net), Taxes, Depreciation and Amortization (including amortization of intangible assets, deferred expenses-right of use and impairment charges) and Other expenses (mainly amortization of share based compensation). Adjusted EBITDA is not a financial measure under IFRS and may not be comparable to other similarly titled measures for other companies. Adjusted EBITDA may not be indicative of the Group's historic operating results nor is it meant to be predictive of potential future results. The usage of the term "Adjusted EBITDA" is to highlight the fact that the Amortization includes amortization of deferred expenses – right of use and amortization of employee share based compensation and impairment charges.
(3) Operating expenses include selling and marketing expenses, general and administrative expenses and credit losses.
PARTNER COMMUNICATIONS COMPANY LTD. | ||||
New Israeli Shekels | Convenience | |||
Year ended December 31, | ||||
2018** | 2019 | 2020 | 2020 | |
In millions | ||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||
Cash generated from operations (Appendix) | 627 | 838 | 787 | 244 |
Income tax paid | (2) | (1) | (1) | * |
Net cash provided by operating activities | 625 | 837 | 786 | 244 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||
Acquisition of property and equipment | (343) | (462) | (409) | (127) |
Acquisition of intangible and other assets | (159) | (167) | (164) | (51) |
Acquisition of a business, net of cash acquired | (3) | |||
Proceeds from (investment in) deposits, net | 150 | (552) | (14) | (4) |
Interest received | 1 | 1 | 6 | 2 |
Consideration received from sales of property and equipment | 3 | 2 | * | * |
Payment for acquisition of subsidiary, net of cash acquired | (3) | |||
Net cash used in investing activities | (351) | (1,181) | (581) | (180) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||
Lease principal payments | (139) | (129) | (40) | |
Lease interest payments | (20) | (18) | (6) | |
Share issuance, net of issuance costs | 276 | 86 | ||
Acquisition of treasury shares | (100) | |||
Proceeds from issuance of notes payable, net of issuance costs | 150 | 562 | 466 | 145 |
Proceeds from issuance of option warrants exercisable for notes | 37 | |||
Interest paid | (69) | (37) | (49) | (15) |
Repayment of non-current borrowings | (382) | (52) | (52) | (16) |
Repayment of current borrowings | (13) | |||
Repayment of notes payables | (324) | (109) | (620) | (193) |
Settlement of contingent consideration | (2) | (1) | ||
Transactions with non-controlling interests | (2) | |||
Net cash provided by (used in) financing activities | (725) | 227 | (128) | (40) |
INCREASE (DECREASE) IN CASH AND CASH | (451) | (117) | 77 | 24 |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 867 | 416 | 299 | 93 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 416 | 299 | 376 | 117 |
* Representing an amount of less than 1 million.
** See report 20-F regarding the adoption of IFRS 16 – Leases, from the beginning of 2019.
PARTNER COMMUNICATIONS COMPANY LTD. | ||||
Appendix - Cash generated from operations and supplemental information | ||||
New Israeli Shekels | Convenience | |||
Year ended December 31, | ||||
2018** | 2019 | 2020 | 2020 | |
In millions | ||||
Cash generated from operations: | ||||
Profit for the year | 56 | 19 | 17 | 5 |
Adjustments for: | ||||
Depreciation and amortization | 545 | 723 | 683 | 212 |
Amortization of deferred expenses - Right of use | 47 | 28 | 31 | 10 |
Employee share based compensation expenses | 15 | 17 | 12 | 4 |
Liability for employee rights upon retirement, net | 1 | 1 | (1) | * |
Finance costs, net | (7) | 5 | (2) | (1) |
Lease interest payments | 20 | 18 | 6 | |
Interest paid | 69 | 37 | 49 | 15 |
Interest received | (1) | (1) | (6) | (2) |
Deferred income taxes | 16 | 4 | 12 | 4 |
Income tax paid | 2 | 1 | 1 | * |
Capital loss from property and equipment | * | (2) | * | * |
Changes in operating assets and liabilities: | ||||
Decrease (increase) in accounts receivable: | ||||
Trade | 124 | 42 | 82 | 26 |
Other | 16 | (1) | (6) | (2) |
Increase (decrease) in accounts payable and accruals: | ||||
Trade | (69) | 63 | (57) | (18) |
Other payables | (18) | 12 | (37) | (12) |
Provisions | (11) | (21) | (30) | (9) |
Deferred revenues from HOT mobile | (31) | (31) | (31) | (10) |
Other deferred revenues | * | 4 | 55 | 17 |
Increase in deferred expenses - Right of use | (107) | (51) | (47) | (15) |
Current income tax | (15) | (5) | (3) | (1) |
Decrease (increase) in inventories | (5) | (26) | 47 | 15 |
Cash generated from operations | 627 | 838 | 787 | 244 |
* Representing an amount of less than 1 million.
** See report 20-F regarding the adoption of IFRS 16 – Leases, from the beginning of 2019.
At December 31, 2018, 2019 and 2020, trade and other payables, net include NIS 157 million, NIS 115 million and NIS 139 million (US
These balances are recognized in the cash flow statements upon payment. Cost of inventory used as fixed assets during 2019 and 2020 were NIS 24 million and NIS 8 million (US
Reconciliation of Non-GAAP Measures:
Adjusted Free Cash Flow | New Israeli Shekels | Convenience translation into | ||||
12 months ended December 31, | 3 months ended December 31, | 12 months | 3 months | |||
2019 | 2020 | 2019 | 2020 | 2020 | 2020 | |
(Audited) | (Audited) | (Unaudited) | (Unaudited) | (Audited) | (Unaudited) | |
In millions | ||||||
Net cash provided by operating activities | 837 | 786 | 178 | 182 | 244 | 57 |
Net cash used in investing activities | (1,181) | (581) | (523) | (61) | (180) | (19) |
Investment in (proceeds from) deposits, net | 552 | 14 | 396 | (92) | 4 | (29) |
Lease principal payments | (139) | (129) | (30) | (27) | (40) | (8) |
Lease interest payments | (20) | (18) | (5) | (5) | (6) | (2) |
Adjusted Free Cash Flow | 49 | 72 | 16 | (3) | 22 | (1) |
Interest paid | (37) | (49) | (16) | (7) | (15) | (2) |
Adjusted Free Cash Flow After Interest | 12 | 23 | 0 | (10) | 7 | (3) |
Total Operating Expenses (OPEX) | New Israeli Shekels | Convenience translation into | ||||
12 months ended December 31, | 3 months ended December 31, | 12 months | 3 months | |||
2019 | 2020 | 2019 | 2020 | 2020 | 2020 | |
(Audited) | (Audited) | (Unaudited) | (Unaudited) | (Audited) | (Unaudited) | |
In millions | ||||||
Cost of revenues - Services | 2,177 | 2,128 | 532 | 543 | 663 | 168 |
Selling and marketing expenses | 301 | 291 | 73 | 79 | 90 | 25 |
General and administrative expenses | 149 | 145 | 40 | 35 | 45 | 11 |
Credit losses | 18 | 23 | 3 | 4 | 7 | 1 |
Depreciation and amortization | (751) | (714) | (184) | (180) | (222) | (56) |
Other (1) | (9) | (2) | 3 | (1) | (1) | * |
OPEX | 1,885 | 1,871 | 467 | 480 | 582 | 149 |
* Representing an amount of less than 1 million.
(1) Mainly amortization of employee share based compensation.
Key Financial and Operating Indicators (unaudited) ***
NIS M unless otherwise stated | Q4' 18 | Q1' 19 | Q2' 19 | Q3' 19 | Q4' 19 | Q1' 20 | Q2' 20 | Q3' 20 | Q4' 20 | 2019 | 2020 | |
Cellular Segment Service Revenues | 447 | 441 | 453 | 466 | 438 | 423 | 409 | 415 | 416 | 1,798 | 1,663 | |
Cellular Segment Equipment Revenues | 165 | 142 | 115 | 142 | 172 | 146 | 130 | 134 | 135 | 571 | 545 | |
Fixed-Line Segment Service Revenues | 220 | 224 | 230 | 233 | 238 | 245 | 244 | 252 | 252 | 925 | 993 | |
Fixed-Line Segment Equipment Revenues | 24 | 28 | 24 | 25 | 26 | 32 | 28 | 35 | 41 | 103 | 136 | |
Reconciliation for consolidation | (42) | (41) | (41) | (41) | (40) | (39) | (37) | (36) | (36) | (163) | (148) | |
Total Revenues | 814 | 794 | 781 | 825 | 834 | 807 | 774 | 800 | 808 | 3,234 | 3,189 | |
Gross Profit from Equipment Sales | 42 | 39 | 35 | 33 | 37 | 37 | 30 | 38 | 40 | 144 | 145 | |
Operating Profit* | 14 | 9 | 22 | 26 | 30 | 36 | 20 | 20 | 20 | 87 | 96 | |
Cellular Segment Adjusted EBITDA* | 119 | 150 | 159 | 170 | 156 | 132 | 129 | 134 | 138 | 635 | 533 | |
Fixed-Line Segment Adjusted EBITDA* | 53 | 47 | 55 | 55 | 61 | 83 | 71 | 70 | 65 | 218 | 289 | |
Total Adjusted EBITDA* | 172 | 197 | 214 | 225 | 217 | 215 | 200 | 204 | 203 | 853 | 822 | |
Adjusted EBITDA Margin (%)* | ||||||||||||
OPEX* | 502 | 472 | 472 | 474 | 467 | 460 | 456 | 475 | 480 | 1,885 | 1,871 | |
Finance costs, net* | 12 | 14 | 16 | 18 | 20 | 19 | 13 | 24 | 13 | 68 | 69 | |
Profit (Loss)* | 19 | 2 | 3 | 7 | 7 | 10 | 7 | (5) | 5 | 19 | 17 | |
Capital Expenditures (cash) | 143 | 185 | 143 | 174 | 127 | 151 | 119 | 147 | 156 | 629 | 573 | |
Capital Expenditures (additions) | 177 | 157 | 142 | 150 | 129 | 129 | 121 | 179 | 166 | 578 | 595 | |
Adjusted Free Cash Flow | (22) | (11) | 31 | 13 | 16 | 10 | 44 | 21 | (3) | 49 | 72 | |
Adjusted Free Cash Flow (after interest) | (37) | (15) | 15 | 12 | 0 | 8 | 13 | 12 | (10) | 12 | 23 | |
Net Debt | 950 | 977 | 965 | 956 | 957 | 673 | 658 | 646 | 657 | 957 | 657 | |
Cellular Subscriber Base (Thousands) | 2,646 | 2,620 | 2,616 | 2,651 | 2,657 | 2,676 | 2,708 | 2,762 | 2,836 | 2,657 | 2,836 | |
Post-Paid Subscriber Base (Thousands) | 2,361 | 2,340 | 2,337 | 2,366 | 2,366 | 2,380 | 2,404 | 2,437 | 2,495 | 2,366 | 2,495 | |
Pre-Paid Subscriber Base (Thousands) | 285 | 280 | 279 | 285 | 291 | 296 | 304 | 325 | 341 | 291 | 341 | |
Cellular ARPU (NIS) | 57 | 56 | 58 | 59 | 55 | 53 | 51 | 51 | 49 | 57 | 51 | |
Cellular Churn Rate (%) | ||||||||||||
Infrastructure-Based Internet Subscribers (Thousands) | 268 | 281 | 295 | 311 | 329 | 268 | 329 | |||||
Fiber-Optic subscribers (Thousands) | 76 | 87 | 101 | 120 | 139 | 76 | 139 | |||||
Homes connected to fiber-optic infrastructure | 324 | 361 | 396 | 432 | 465 | 324 | 465 | |||||
TV Subscriber Base (Thousands) | 122 | 141 | 160 | 176 | 188 | 200 | 215 | 224 | 232 | 188 | 232 | |
Number of Employees (FTE)** | 2,782 | 2,897 | 2,895 | 2,923 | 2,834 | 1,867 | 2,745 | 2,731 | 2,655 | 2,834 | 2,655 |
Comments:
* Figures from 2019 include impact of adoption of IFRS 16 - Leases (see also report 20-F).
** From 2019, the number of employees (FTE) also includes the number of FTE of PHI on a proportional basis of Partner's share in the subsidiary (
***See footnote 2 regarding use of non-GAAP measures.
Disclosure for notes holders as of December 31, 2020
Information regarding the notes series issued by the Company, in million NIS
Series | Original | Principal on | As of 31.12.2020 | Annual interest | Principal repayment | Interest | Interest | Trustee contact details | ||||
Principal | Linked principal | Interest accumulated | Market | From | To | |||||||
D | 25.04.10 04.05.11* | 400 146 | 109 | 109 | ** | 110 |
(MAKAM+ | 30.12.17 | 30.12.21 | 30.03, 30.06, 30.09, 30.12 | Variable | Hermetic Trust (1975) Ltd. |
F (2) (3) | 20.07.17 12.12.17* 04.12.18* 01.12.19* | 255 389 150 226.75 | 512 | 512 | ** | 524 | 25.06.20 | 25.06.24 | 25.06, 25.12 | Not Linked | Hermetic Trust (1975) Ltd. Merav Offer. 113 Hayarkon | |
G (1) (2) | 06.01.19 01.07.19* 28.11.19* 27.02.20* 31.05.20* 01.07.20* 02.07.20* 26.11.20* | 225 38.5 86.5 15.1 84.8 12.2 300 62.2 | 824 | 824 | 17 | 939 | 25.06.22 | 25.06.27 | 25.06 | Not Linked | Hermetic Trust (1975) Ltd. Merav Offer. 113 Hayarkon | |
(1) In April 2019, the Company issued in a private placement 2 series of untradeable option warrants that are exercisable for the Company's Series G debentures. The exercise period of the first series is between July 1, 2019 and May 31, 2020 and of the second series is between July 1, 2020 and May 31, 2021. The Series G debentures that will be allotted upon the exercise of an option warrant will be identical in all their rights to the Company's Series G debentures immediately upon their allotment, and will be entitled to any payment of interest or other benefit, the effective date of which is due after the allotment date. The debentures that will be allotted as a result of the exercise of option warrants will be registered on the TASE. The total amount received by the Company on the allotment date of the option warrants is NIS 37 million. For additional details see the Company's press release dated April 17, 2019. Following exercise of option warrants from the first series, the Company issued Series G Notes in a total principal amount of NIS 225 million. Following exercise of option warrants from the second series in July 2020 and November 2020, the Company issued Series G Notes in a principal amount of NIS 12.2 million and NIS 62.2 million, respectively. As of today, the total future considerations expected to the Company in respect of the allotment of the option warrants from the second series (after the exercises of option warrants as described above) and in respect of their full exercise (and assuming that there will be no change to the exercise price) is approximately NIS 23 million.
In July 2020, the Company issued in a private placement additional Series G Notes in a principal amount of NIS 300 million, under the same conditions of the original series.
(2) Regarding Series F and G Notes, the Company is required to comply with a financial covenant that the ratio of Net Debt to Adjusted EBITDA shall not exceed 5. Compliance will be examined and reported on a quarterly basis. For the purpose of the covenant, Adjusted EBITDA is calculated as the sum total for the last 12 month period, excluding adjustable one-time items. As of December 31, 2020, the ratio of Net Debt to Adjusted EBITDA was 0.8. Additional stipulations regarding Series F and G Notes mainly include: shareholders' equity shall not decrease below NIS 400 million and NIS 600 million, respectively; the Company shall not create floating liens subject to certain terms; the Company has the right for early redemption under certain conditions; the Company shall pay additional annual interest of
In the reporting period, the Company was in compliance with all financial covenants and obligations and no cause for early repayment occurred.
(3) In July 2020, the Company executed a partial early redemption of Series F Notes in a total principal amount of NIS 305 million. The total amount paid was NIS 313 million.
(4) 'MAKAM' is a variable interest based on the yield of 12 month government bonds issued by the government of Israel. The interest rate is updated on a quarterly basis.
* On these dates additional Notes of the series were issued. The information in the table refers to the full series.
** Representing an amount of less than NIS 1 million.
Disclosure for Notes holders as of December 31, 2020 (cont.)
Notes Rating Details*
Series | Rating | Rating as of | Rating assigned | Recent date of rating | Additional ratings between the original issuance date and the recent date of rating (2) | |
Date | Rating | |||||
D | S&P Maalot | ilA+ | ilAA- | 11/2020 | 07/2010, 09/2010, 10/2010, 09/2012, 12/2012, 06/2013, 07/2014, 07/2015, 07/2016, 07/2017, 08/2018, 11/2018, 12/2018, 01/2019, 04/2019, 08/2019, 02/2020, 05/2020, 06/2020, 07/2020, 08/2020, 11/2020 | ilAA-, ilAA-, ilAA-, ilAA-, ilAA-, ilAA-, ilAA-, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+ |
F | S&P Maalot | ilA+ | ilA+ | 11/2020 | 07/2017, 09/2017, 12/2017, 01/2018, 08/2018, 11/2018, 12/2018, 01/2019, 04/2019, 08/2019, 02/2020, 05/2020, 06/2020, 07/2020, 08/2020, 11/2020 | ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+ |
G (3) | S&P Maalot | ilA+ | ilA+ | 11/2020 | 12/2018, 01/2019, 04/2019, 08/2019, 02/2020, 05/2020, 06/2020, 07/2020, 08/2020, 11/2020 | ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+ |
(1) In August 2020, S&P Maalot reaffirmed the Company's ilA+ credit rating and updated the Company's rating outlook from "negative" to "stable".
(2) For details regarding the rating of the notes see the S&P Maalot reports dated August 10, 2020.
(3) In January 2019, the Company issued Series G Notes in a principal amount of NIS 225 million. In July 2019, November 2019, February 2020, May 2020, July 2020 and November 2020 the Company issued additional Series G Notes in a principal amount of NIS 38.5 million, NIS 86.5 million, NIS 15.1 million, NIS 84.8 million, NIS 12.2 million and NIS 62.2 million, respectively. In addition, in July 2020, the Company issued in a private placement additional Series G Notes in a principal amount of NIS 300 million.
* A securities rating is not a recommendation to buy, sell or hold securities. Ratings may be subject to suspension, revision or withdrawal at any time, and each rating should be evaluated independently of any other rating
Summary of Financial Undertakings (according to repayment dates) as of December 31, 2020
a. Notes issued to the public by the Company and held by the public, excluding such notes held by the Company's parent company, by a controlling shareholder, by companies controlled by them, or by companies controlled by the Company, based on the Company's "Solo" financial data (in thousand NIS).
Principal payments | Gross interest | |||||
ILS linked | ILS not linked | Euro | Dollar | Other | ||
First year | - | 237,130 | - | - | - | 43,984 |
Second year | - | 210,334 | - | - | - | 39,880 |
Third year | - | 210,334 | - | - | - | 33,820 |
Fourth year | - | 210,334 | - | - | - | 27,832 |
Fifth year and on | - | 577,027 | - | - | - | 56,054 |
Total | - | 1,445,159 | - | - | - | 201,570 |
b. Private notes and other non-bank credit, excluding such notes held by the Company's parent company, by a controlling shareholder, by companies controlled by them, or by companies controlled by the Company, based on the Company's "Solo" financial data – None.
c. Credit from banks in Israel based on the Company's "Solo" financial data (in thousand NIS).
Principal payments | Gross interest | |||||
ILS linked to CPI | ILS not linked to CPI | Euro | Dollar | Other | ||
First year | - | 52,132 | - | - | - | 2,915 |
Second year | - | 52,132 | - | - | - | 1,643 |
Third year | - | 22,720 | - | - | - | 639 |
Fourth year | - | 11,400 | - | - | - | 107 |
Fifth year and on | - | - | - | - | - | - |
Total | - | 138,384 | - | - | - | 5,304 |
Summary of Financial Undertakings (according to repayment dates) as of December 31, 2020 (cont.)
d. Credit from banks abroad based on the Company's "Solo" financial data – None.
e. Total of sections a - d above, total credit from banks, non-bank credit and notes based on the Company's "Solo" financial data (in thousand NIS).
Principal payments | Gross interest | |||||
ILS linked | ILS not linked | Euro | Dollar | Other | ||
First year | - | 289,262 | - | - | - | 46,899 |
Second year | - | 262,466 | - | - | - | 41,523 |
Third year | - | 233,054 | - | - | - | 34,459 |
Fourth year | - | 221,734 | - | - | - | 27,939 |
Fifth year and on | - | 577,027 | - | - | - | 56,054 |
Total | - | 1,583,543 | - | - | - | 206,874 |
f. Off-balance sheet Credit exposure based on the Company's "Solo" financial data (in thousand NIS) – 50,000 (Guarantees on behalf of a joint arrangement, without expiration date).
g. Off-balance sheet Credit exposure of all the Company's consolidated companies, excluding companies that are reporting corporations and excluding the Company's data presented in section f above - None.
h. Total balances of the credit from banks, non-bank credit and notes of all the consolidated companies, excluding companies that are reporting corporations and excluding Company's data presented in sections a - d above - None.
i. Total balances of credit granted to the Company by the parent company or a controlling shareholder and balances of notes offered by the Company held by the parent company or the controlling shareholder - None.
j. Total balances of credit granted to the Company by companies held by the parent company or the controlling shareholder, which are not controlled by the Company, and balances of notes offered by the Company held by companies held by the parent company or the controlling shareholder, which are not controlled by the Company – None.
k. Total balances of credit granted to the Company by consolidated companies and balances of notes offered by the Company held by the consolidated companies - None.
In addition to the total credit above, Company's financial debt includes financial liability at fair value in respect of option warrants issued in May 2019. At December 31, 2020, this financial liability totaled to an amount of NIS 4 million.
View original content:http://www.prnewswire.com/news-releases/partner-communications-reports-fourth-quarter-and-annual-2020-results1-301255749.html
SOURCE Partner Communications Company Ltd.
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