Partner Communications Reports Second Quarter 2021 Results[1]
Partner Communications Company Ltd. (PTNR) reported Q2 2021 results with total revenues at NIS 840 million (US$ 258 million), up 9% year-over-year. Service revenues rose 5% to NIS 649 million (US$ 199 million). Equipment revenues increased by 21% to NIS 191 million (US$ 59 million). OPEX climbed 6% to NIS 485 million (US$ 149 million). Adjusted EBITDA was NIS 213 million (US$ 65 million), reflecting a 6% increase. Net profit grew to NIS 9 million (US$ 3 million). Cellular subscribers reached 2.97 million, while fiber-optic subscribers hit 173 thousand, showing significant growth.
- Total revenues increased by 9% year-over-year to NIS 840 million.
- Service revenues grew by 5% to NIS 649 million, largely due to increased cellular and fixed-line services.
- Equipment revenues rose 21%, reaching NIS 191 million, indicating strong sales recovery.
- Adjusted EBITDA increased by 6% to NIS 213 million, demonstrating effective cost management.
- Net profit for the quarter was NIS 9 million, a 29% increase from the previous year.
- Adjusted Free Cash Flow decreased significantly to NIS 8 million, down from NIS 44 million in Q2 2020.
- Cellular ARPU dropped by 6% to NIS 48, reflecting ongoing price erosion.
- TV subscriber base decreased by 11 thousand, indicating potential challenges in the segment.
ROSH HA'AYIN, Israel, Aug. 18, 2021 /PRNewswire/ --
Second quarter 2021 highlights (compared with second quarter 2020)
- Total Revenues: NIS 840 million (US
$ 258 million ), an increase of9% - Service Revenues: NIS 649 million (US
$ 199 million ), an increase of5% - Equipment Revenues: NIS 191 million (US
$ 59 million ), an increase of21% - Total Operating Expenses (OPEX)2: NIS 485 million (US
$ 149 million ), an increase of6% - Adjusted EBITDA: NIS 213 million (US
$ 65 million ), an increase of6% - Profit for the Period: NIS 9 million (US
$ 3 million ), an increase of NIS 2 million - Adjusted Free Cash Flow (before interest)2: NIS 8 million (US
$ 2 million ), a decrease of NIS 36 million - Cellular ARPU: NIS 48 (US
$ 15) , a decrease of6% - Cellular Subscriber Base: approximately 2.97 million at quarter-end, an increase of
10% - Fiber-Optic Subscriber Base: 173 thousand subscribers at quarter-end, an increase of 72 thousand subscribers since Q2 2020, and an increase of 18 thousand in the quarter
- Homes Connected (HC) to Partner's Fiber-Optic Infrastructure: 571 thousand at quarter-end, an increase of 175 thousand since Q2 2020, and an increase of 57 thousand in the quarter
- Infrastructure-Based Internet Subscriber Base: 354 thousand subscribers at quarter-end, an increase of 59 thousand subscribers since Q2 2020, and an increase of 15 thousand in the quarter
- TV Subscriber Base: 223 thousand subscribers at quarter-end, an increase of 8 thousand subscribers since Q2 2020, and a decrease of 11 thousand in the quarter. Excluding subscribers removal, as explained below, the subscriber base increased by 10 thousand in the second quarter
Partner Communications Company Ltd. ("Partner" or the "Company") (NASDAQ: PTNR) (TASE: PTNR), a leading Israeli communications provider, announced today its results for the quarter ended June 30, 2021.
Commenting on the results for the second quarter 2021, Mr. Avi Zvi, CEO of Partner, noted:
"In the second quarter, Partner continued to lead the Israeli communications market in innovation and in business activity growth, while maintaining profitability - even at a time when the impact of COVID-19 is still noticeable.
Since I took office in June, I've been learning how the Company works, getting to know its employees and formalizing, with the management team and board members, a new company structure that will lead Partner in the future. I have discovered a Company with human capital of the first degree and management agility that, along with its financial strength, will advance Partner towards new and significant projects.
Along with strategy building and Partner's new structure, we have begun to take steps in order to promote even further Partner's leadership in customer service and to increase the profitability in product lines and operational segments of the Company."
Mr. Tamir Amar, Partner's Deputy CEO & Chief Financial Officer, commented on the results:
"In the second quarter of 2021, growth in revenues continued while maintaining a cost structure that enabled growth in profit. A moderate return of roaming service revenues along with an increase in the subscriber base led to cellular service revenue growth compared to the corresponding period last year. The fixed-line segment's growth trajectory continued along with an improvement in Adjusted EBITDA.
Our cellular subscriber base totaled 2.97 million at quarter-end, an increase of 67 thousand in the quarter, of which 31 thousand were subscribers of data and voice packages provided to students with a fixed twelve-month package by the Ministry of Education as part of their COVID-19 program. Excluding these subscribers, the increase in Post-Paid subscribers totaled 36 thousand this quarter. The churn rate in the quarter amounted to
In the fixed-line segment, we continued to focus on connecting buildings to the Company's fiber-optic infrastructure. The number of homes connected within buildings connected to our fiber-optic infrastructure was 571 thousand at the end of the quarter, an increase of 57 thousand in the quarter.
Partner's fiber-optic subscriber base totaled 173 thousand at the end of the quarter, an increase of 18 thousand in the quarter and of 34 thousand since the beginning of the year, reflecting a
The results for the second quarter of 2021 reflect the Company's budgetary discipline. The level of OPEX remained stable whilst our subscriber base increased, and television content was expanded to include the "SPORT ONE" premium channels and others. Note that the OPEX level in the corresponding quarter last year was lower than usual due to a decrease in payroll and related expenses mainly due to employees being placed on unpaid leave during the quarter as a result of COVID-19.
In addition, the results of the second quarter of 2021 include a provision for the Company's contribution to the government-mandated fiber incentive fund in an amount of NIS 6 million. The purpose of the fund, which is funded by telecoms infrastructure and service providers, is to provide an incentive for telecoms operators (excluding Bezeq and its Group members) to deploy fiber-optic infrastructure in areas which are not included in the committed areas of Bezeq's fiber-optic roll-out plan as provided to the Ministry of Communications. We estimate that a similar amount shall be provisioned for the fund during the second half of the year.
Adjusted EBITDA in the second quarter of 2021 totaled NIS 213 million, an increase of
Looking ahead, the Company expects the moderate recovery in roaming service revenues, due to the continued increase in air travel, to continue in the third quarter of 2021. However, a retreat is possible in view of the possible implications of the new COVID-19 variants for air travel.
Adjusted Free Cash Flow (before interest and including lease payments) for the quarter totaled NIS 8 million, and CAPEX payments for the quarter totaled NIS 139 million.
Net debt stood at NIS 670 million at the end of the quarter, compared with NIS 658 million at the end of the corresponding quarter last year, an increase of NIS 12 million. The financial robustness of the Company remains strong, with the Company's net debt to Adjusted EBITDA ratio at 0.8 at the end of the quarter."
Q2 2021 compared with Q2 2020 | |||
NIS Million (except EPS) | Q2'20 | Q2'21 | Comments |
Service Revenues | 616 | 649 | The increase reflected growth in fixed-line and cellular |
Equipment Revenues | 158 | 191 | The increase reflected a higher volume of equipment |
Total Revenues | 774 | 840 | |
Gross profit from equipment sales | 30 | 39 | |
OPEX | 456 | 485 | The increase mainly reflects the cost-cutting measures |
Operating profit | 20 | 30 | Excl. fund provision, operating profit in Q2'21 totaled NIS |
Adjusted EBITDA | 200 | 213 | Excl. fund provision, Adjusted EBITDA in Q2'21 totaled |
Adjusted EBITDA as a percentage | |||
Profit for the period | 7 | 9 | |
Earnings per share (basic, NIS) | 0.04 | 0.05 | |
Capital Expenditures (cash) | 119 | 139 | |
Adjusted free cash flow (before | 44 | 8 | |
Net Debt | 658 | 670 | |
Key Performance Indicators | ||||
Q2'20 | Q1'21 | Q2'21 | Change QoQ | |
Cellular Subscribers (end of | 2,708 | 2,903 | 2,970 | Post-Paid: Increase of 67 thousand from Q1'21 Pre-Paid: Unchanged from Q1'21 |
Monthly Average Revenue per | 51 | 48 | 48 | |
Quarterly Cellular Churn Rate (%) | ||||
Fiber-Optic Subscribers (end of | 101 | 155 | 173 | Increase of 18 thousand subscribers |
Homes Connected to the Fiber- | 396 | 514 | 571 | Increase of 57 thousand households |
Infrastructure-Based Internet | 295 | 339 | 354 | Increase of 15 thousand subscribers |
TV Subscribers (end of period, | 215 | 234 | 223 | Decrease of 11 thousand subscribers. An |
Partner Consolidated Results | |||||||||||
Cellular Segment | Fixed-Line Segment | Elimination | Consolidated | ||||||||
NIS Million | Q2'20 | Q2'21 | Change % | Q2'20 | Q2'21 | Change % | Q2'20 | Q2'21 | Q2'20 | Q2'21 | Change % |
Total Revenues | 539 | 577 | + | 272 | 296 | + | (37) | (33) | 774 | 840 | + |
Service Revenues | 409 | 420 | + | 244 | 262 | + | (37) | (33) | 616 | 649 | + |
Equipment Revenues | 130 | 157 | + | 28 | 34 | + | - | - | 158 | 191 | + |
Operating Profit (Loss) | 13 | 35 | + | 7 | -5 | - | - | - | 20 | 30 | + |
Adjusted EBITDA | 129 | 139 | + | 71 | 74 | + | - | - | 200 | 213 | + |
Financial Review
In Q2 2021, total revenues were NIS 840 million (US
Service revenues in Q2 2021 totaled NIS 649 million (US
Service revenues for the cellular segment in Q2 2021 totaled NIS 420 million (US
Service revenues for the fixed-line segment in Q2 2021 totaled NIS 262 million (US
Equipment revenues in Q2 2021 totaled NIS 191 million (US
Gross profit from equipment sales in Q2 2021 was NIS 39 million (US
Total operating expenses ('OPEX') totaled NIS 485 million (US
OPEX including depreciation and amortization expenses and other expenses (mainly amortization of employee share based compensation) increased in Q2 2021 by
Operating profit for Q2 2021 was 30 million (US
Adjusted EBITDA in Q2 2021 totaled NIS 213 million (US
Adjusted EBITDA for the cellular segment was NIS 139 million (US
Adjusted EBITDA for the fixed-line segment was NIS 74 million (US
Finance costs, net in Q2 2021 were NIS 16 million (US
Income tax expenses in Q2 2021 were NIS 5 million (US
Profit in Q2 2021 was NIS 9 million (US
Based on the weighted average number of shares outstanding during Q2 2021, basic earnings per share or ADS, was NIS 0.05 (US
Cellular Segment Operational Review
At the end of Q2 2021, the Company's cellular subscriber base (including mobile data, 012 Mobile subscribers and M2M subscriptions) was approximately 2.97 million, including approximately 2.62 million Post-Paid subscribers or
During the second quarter of 2021, the cellular subscriber base increased, net, by 67 thousand subscribers. The Post-Paid subscriber base increased, net, by 67 thousand subscribers and the Pre-Paid subscriber base remained unchanged. The increase in the Post-Paid subscriber base included approximately 30 thousand subscribers of data packages and one thousand subscribers of voice packages provided to students with a fixed twelve-month period by the Ministry of Education as part of their COVID-19 program.
Total cellular market share (based on the number of subscribers) at the end of Q2 2021 was estimated to be approximately
The quarterly churn rate for cellular subscribers in Q2 2021 was
The monthly Average Revenue per User ("ARPU") for cellular subscribers in Q2 2021 was NIS 48 (US
Fixed-Line Segment Operational Review
At the end of Q2 2021:
- The Company's fiber-optic subscriber base was 173 thousand subscribers, an increase, net, of 18 thousand subscribers during the second quarter of 2021.
- The Company's infrastructure-based internet subscriber base (fiber subscribers and wholesale market subscribers) was 354 thousand subscribers, an increase, net, of 15 thousand subscribers during the second quarter of 2021.
- Households in buildings connected to our fiber-optic infrastructure (HC) totaled 571 thousand, an increase of 57 thousand during the second quarter of 2021.
- The Company's TV subscriber base totaled 223 thousand subscribers, a decrease, net, of 11 thousand subscribers during the second quarter of 2021. In the second quarter of 2021, the Company removed from its TV subscriber base approximately 21,000 subscribers who had joined the company at various times and had remained in trial periods of over six months without charge or usage. Excluding this removal, the subscriber base increased by 10 thousand in the second quarter.
Funding and Investing Review
In Q2 2021, Adjusted Free Cash Flow (including lease payments) totaled NIS 8 million (US
Cash generated from operating activities totaled NIS 179 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 139 million (US
The level of net debt at the end of Q2 2021 amounted to NIS 670 million (US
Regulatory Developments
Call for Public Comments on the incentive tenders for the deployment of FTTH networks
Further to the description in the Company's 2020 Annual Report-Item 4B-12e-vii "Amendment to the Communications law regarding the deployment of fiber-optic infrastructures in Israel", in July 2021 the Ministry of Communications published a Call for Public Comments (the "Call") regarding the principles of the tender processes (the "Incentive Tenders") it plans to apply for incentivizing the rollout of FTTH (fiber to the home) networks in areas in which Bezeq has decided not to deploy its FTTH network.
For each statistical area in which Bezeq has decided not to deploy its FTTH network, a licensee would be chosen (by a tender process) to deploy an FTTH network to all households in said area. The winning bidder will receive a financial stimulus for such deployment from an incentive fund and will be obliged to deploy an FTTH network in this area (but will also be obliged to provide other licensees with a wholesale BSA (bit stream access) service on its FTTH network in said area). Bezeq and its subsidiaries would not allowed to deploy a fiber optic network in these areas for a period of five years.
Among other issues, the Call specified the tender mechanism for selecting the winning bidders. In order to allow for economies of scope and maximize the use of subsidy funds, the Ministry intends to apply an auction mechanism known as a "first-price package auction". This mechanism allows each bidder to submit a number of bids for one, or more, statistical areas (up to 1,000 bids per bidder). Each bid would also be required to specify the amount of money the bidder requires for deploying an FTTH network to all households in the statistical areas included in said bid.
The winning bids would be selected by an algorithm which would identify the optimal combination of bids – the combination which maximizes the number of households to be connected to an FTTH network, given the amount of money available to incentive fund for the relevant year. The Company has filed a detailed position in response to the Call.
Folkman Committee Recommendations
In September 2020, the Minister of Communications appointed a committee assigned with re-examining the overall regulatory regime applicable to the broadcasting segment in Israel (the "Folkman Committee"). See the Company's 2020 Annual Report-Item 3D.1.f.
In July 2021 the Folkman Committee submitted its recommendations to the Minister of Communications.
The Folkman Committee's report includes, among other things, recommendations regarding the following issues:
- The establishment of a single regulatory authority for commercial broadcasting (which would replace the Council for Cable and Satellite Broadcasting and the Second Authority Council);
- The single regulatory authority will regulate all audiovisual content providers, including TV content services which are provided over the Internet ("OTT"), such as those of the Company, and which are currently unregulated;
- Regulation would be applied to audiovisual content providers in a gradual manner, in accordance with their annual income: (1) all audiovisual content providers (regardless of their annual income) would be subject to rules regarding ethics and a ban on exclusivity in sports programming, rules concerning accessibility would be applied gradually (in accordance with annual income); (2) an audiovisual content provider with an annual income of more than NIS 300 million would be subject to a license and would be required to invest between
4% to6.5% of its annual income in specific local production genres; (3) an audiovisual content provider with an annual income of more than NIS 600 million would be required to invest6.5% of its annual income in specific local production genres.
The actual implementation of the committee's recommendations is subject to adoption by the Minister of Communications and various other processes (such as amendments to legislation).
The Ministry has allowed the public to comment on the Folkman Committee's recommendations. The Company is currently studying these recommendations and their possible implications on its TV offering and intends to file a detailed position regarding the recommendations of the Folkman Committee.
Decision regarding a reform in the structure of the Internet Market
The fixed internet access market in Israel is currently divided into two tiers of services: infrastructure services and ISP service. This split was intended to allow entry of new competitors, which provide services over Bezeq's and HOT Telecom's infrastructure.
Further to the description in the Company's 2020 Annual Report-Item 4B-12e-x "Hearing regarding a reform in the structure of the Internet Market", in June 2021 the Minister of Communications published its decision regarding the abolition of the split between the infrastructure service and the ISP service.
The decision is aimed at ending the split of this segment into two tiers and allowing Bezeq and Hot Telecom to market a unified product (comprised of both infrastructure and ISP components). The decision lays out several stages for implementation, as follows:
- By 20.8.2021 Bezeq and Hot Telecom are to submit an agreement containing Key Performance Indicators ("KPIs") and agreed compensation provisions with an access seeker (an ISP licensee with at least 10,000 active subscribers in the wholesale market;)
- By 20.9.2021 the Ministry will announce one of the following three alternatives: (1) approval of a submitted agreement; (2) approval of a submitted agreement subject to certain changes announced by the Ministry; (3) If no agreement is submitted – the Ministry will set the terms of a binding agreement.
The agreement will become part of the "shelf offer" of the relevant infrastructure owner and will apply in relation to all access seekers. If Bezeq or Hot Telecom submit more than one agreement with different access seekers, then all access seekers will be offered the option of being included under one of these agreements, without discrimination;
- From 20.9.2021 until 20.12.2021 a "calibration stage" will apply, during which Bezeq, Hot Telecom and access seekers shall report on the KPIs on a monthly basis. The Ministry may choose to extend the calibration period by an additional three months;
- At the end of the calibration period, a "preparation stage" of three months will apply during which the agreed compensation mechanism will be first implemented (alongside the KPIs;)
- On 20.3.2022 (if any of the previous stages have not been extended), Bezeq and Hot Telecom will be allowed to market a unified product (comprised of both infrastructure and ISP components) to household subscribers (the "Effective Date").
From the Effective Date onwards, all new subscribers (and any existing subscribers who wish to alter their existing service) may only be offered a unified product. This decision does not apply to the business sector, where the split between the infrastructure services and ISP service shall remain. At this stage, the Company is unable to evaluate the impact of the decision on the Company's business, among others, in view of the dependence on the determination of the KPIs and the compensation mechanisms and their enforcement by the Ministry of Communications.
Approval of the merger between Bezeq International and Yes
In July 2021, the Minister of Communications approved a merger between Bezeq International and DBS Satellite Services (1998) Ltd. ("Yes"), a multi-channel pay TV provider (both are wholly-owned subsidiaries of Bezeq), subject to certain conditions which have not been published. According to Bezeq's immediate report on this matter (the "Report"), the Minister approved the transfer of Bezeq International's license to Yes as part of a full statutorial merger of Bezeq International into Yes. According to said Report, the existing structural separation provisions will be applied to the new company to which Bezeq International's integration activities will be transferred. Bezeq has announced that in light of the approval, its subsidiaries intend to continue implementing the plan for the change in the group's structure.
Conference Call Details
Partner will host a conference call to discuss its financial results on Wednesday, August 18, 2021 at 10.00 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 August 18, 2021 until September 1, 2021, at the following numbers:
International: +972.3.925.5921
North America toll-free: +1.888.254.7270
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 regarding (i) the scope of the Company's future contribution to the government-mandated fiber incentive fund and (ii) the continued overall impact of COVID-19 on the Company's results. 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) Changes in the regulation and economic conditions with respect to the government-mandated fiber incentive fund and (ii) the severity and duration of the impact on our business of the current health crisis. 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 June 30, 2021: 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 Measure | Calculation | Most Comparable |
Adjusted EBITDA
| Profit (Loss) add Income tax expenses, Finance costs, net, Depreciation and amortization expenses
Adjusted EBITDA divided by Total revenues | Profit (Loss) |
Adjusted Free Cash Flow | 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 add Net cash used in |
Total Operating Expenses (OPEX) | Cost of service revenues add Selling and marketing expenses add General and administrative expenses deduct Depreciation and amortization expenses, Other expenses (mainly amortization of employee | Sum of: Cost of service Selling and marketing General and
|
Net Debt | Current maturities of notes payable and 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, Borrowings from banks, Financial liability at fair 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:
Mr. Tamir Amar Deputy CEO & Chief Financial Officer Tel: +972-54-781-4951
| Mr. Amir Adar Head of Investor Relations and Corporate Projects Tel: +972-54-781-5051 E-mail: investors@partner.co.il |
PARTNER COMMUNICATIONS COMPANY LTD. | ||||
(An Israeli Corporation) | ||||
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION | ||||
New Israeli Shekels | Convenience | |||
December 31, | June 30, | June 30, | ||
2020 | 2021 | 2021 | ||
(Audited) | (Unaudited) | (Unaudited) | ||
In millions | ||||
CURRENT ASSETS | ||||
Cash and cash equivalents | 376 | 280 | 86 | |
Short-term deposits | 411 | 516 | 158 | |
Trade receivables | 560 | 582 | 179 | |
Other receivables and prepaid expenses | 46 | 30 | 9 | |
Deferred expenses – right of use | 26 | 27 | 8 | |
Inventories | 77 | 95 | 29 | |
1,496 | 1,530 | 469 | ||
NON CURRENT ASSETS | ||||
Long-term deposits | 155 | |||
Trade receivables | 232 | 241 | 74 | |
Deferred expenses – right of use | 118 | 131 | 40 | |
Lease – right of use | 663 | 684 | 210 | |
Property and equipment | 1,495 | 1,560 | 479 | |
Intangible and other assets | 521 | 499 | 153 | |
Goodwill | 407 | 407 | 125 | |
Deferred income tax asset | 29 | 21 | 6 | |
Prepaid expenses and other assets | 9 | 10 | 3 | |
3,629 | 3,553 | 1,090 | ||
TOTAL ASSETS | 5,125 | 5,083 | 1,559 | |
PARTNER COMMUNICATIONS COMPANY LTD. | ||||
(An Israeli Corporation) | ||||
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION | ||||
New Israeli Shekels | Convenience | |||
December 31, | June 30, | June 30, | ||
2020 | 2021 | 2021 | ||
(Audited) | (Unaudited) | (Unaudited) | ||
In millions | ||||
CURRENT LIABILITIES | ||||
Current maturities of notes payable and borrowings | 290 | 377 | 116 | |
Trade payables | 666 | 724 | 222 | |
Payables in respect of employees | 58 | 82 | 25 | |
Other payables (mainly institutions) | 29 | 13 | 4 | |
Income tax payable | 27 | 28 | 9 | |
Lease liabilities | 120 | 124 | 38 | |
Deferred revenues from HOT mobile | 31 | 31 | 10 | |
Other deferred revenues | 100 | 98 | 29 | |
Provisions | 13 | 14 | 4 | |
1,334 | 1,491 | 457 | ||
NON CURRENT LIABILITIES | ||||
Notes payable | 1,219 | 1,029 | 316 | |
Borrowings from banks | 86 | 60 | 18 | |
Financial liability at fair value | 4 | |||
Liability for employee rights upon retirement, net | 42 | 44 | 13 | |
Lease liabilities | 582 | 599 | 184 | |
Deferred revenues from HOT mobile | 71 | 55 | 17 | |
Provisions and other non-current liabilities | 64 | 64 | 20 | |
2,068 | 1,851 | 568 | ||
TOTAL LIABILITIES | 3,402 | 3,342 | 1,025 | |
EQUITY | ||||
Share capital - ordinary shares of NIS 0.01 | 2 | 2 | 1 | |
December 31, 2020 – *182,826,973 shares | ||||
June 30, 2021 – *183,165,444 shares | ||||
Capital surplus | 1,311 | 1,285 | 394 | |
Accumulated retained earnings | 606 | 624 | 191 | |
Treasury shares, at cost | (196) | (170) | (52) | |
TOTAL EQUITY | 1,723 | 1,741 | 534 | |
TOTAL LIABILITIES AND EQUITY | 5,125 | 5,083 | 1,559 | |
* Net of treasury shares.
** Including restricted shares in amount of 1,008,735 and 801,194 as of and December 31, 2020 and June 30, 2021, 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. | |||||||||
(An Israeli Corporation) | |||||||||
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF INCOME | |||||||||
New Israeli shekels | Convenience translation | ||||||||
6 months period ended | 3 months period ended | 6 months June 30, | 3 months June 30, | ||||||
2020 | 2021 | 2020 | 2021 | 2021 | 2021 | ||||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||
In millions (except per share data) | |||||||||
Revenues, net | 1,581 | 1,673 | 774 | 840 | 513 | 258 | |||
Cost of revenues | 1,308 | 1,387 | 653 | 696 | 425 | 214 | |||
Gross profit | 273 | 286 | 121 | 144 | 88 | 44 | |||
Selling and marketing expenses | 140 | 157 | 69 | 78 | 48 | 24 | |||
General and administrative expenses | 90 | 86 | 39 | 44 | 26 | 13 | |||
Other income, net | 13 | 15 | 7 | 8 | 5 | 2 | |||
Operating profit | 56 | 58 | 20 | 30 | 19 | 9 | |||
Finance income | 3 | 3 | 4 | 2 | 1 | 1 | |||
Finance expenses | 35 | 38 | 17 | 18 | 12 | 6 | |||
Finance costs, net | 32 | 35 | 13 | 16 | 11 | 5 | |||
Profit before income tax | 24 | 23 | 7 | 14 | 8 | 4 | |||
Income tax expenses | 7 | 9 | * | 5 | 4 | 1 | |||
Profit for the period | 17 | 14 | 7 | 9 | 4 | 3 | |||
Earnings per share | |||||||||
Basic | 0.09 | 0.08 | 0.04 | 0.05 | 0.02 | 0.02 | |||
Diluted | 0.09 | 0.08 | 0.04 | 0.05 | 0.02 | 0.02 | |||
Weighted average number of shares | |||||||||
Basic | 181,926 | 183,111 | 182,615 | 183,150 | 183,111 | 183,150 | |||
Diluted | 182,522 | 183,706 | 183,161 | 183,767 | 183,706 | 183,767 | |||
* Representing an amount of less than 1 million.
PARTNER COMMUNICATIONS COMPANY LTD. | |||||||
(An Israeli Corporation) | |||||||
INTERIM CONDENSED CONSOLIDATED STATEMENTS | |||||||
OF COMPREHENSIVE INCOME | |||||||
New Israeli shekels | Convenience translation | ||||||
6 months period ended | 3 months period ended | 6 months June 30, | 3 months June 30, | ||||
2020 | 2021 | 2020 | 2021 | 2021 | 2021 | ||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||
In millions | |||||||
Profit for the period | 17 | 14 | 7 | 9 | 4 | 3 | |
Other comprehensive income (loss) for the period, net of income tax | 1 | (1) | |||||
TOTAL COMPREHENSIVE INCOME FOR | 18 | 14 | 6 | 9 | 4 | 3 | |
PARTNER COMMUNICATIONS COMPANY LTD. | |||||||||||||||||
(An Israeli Corporation) | |||||||||||||||||
INTERIM SEGMENT INFORMATION & ADJUSTED EBITDA RECONCILIATION | |||||||||||||||||
New Israeli Shekels | New Israeli Shekels | ||||||||||||||||
6 months period ended June 30, 2021 | 6 months period ended June 30, 2020 | ||||||||||||||||
In millions (Unaudited) | In millions (Unaudited) | ||||||||||||||||
Cellular | Fixed line | Elimination | Consolidated | Cellular | Fixed line | Elimination | Consolidated | ||||||||||
Segment revenue - Services | 826 | 462 | 1,288 | 824 | 421 | 1,245 | |||||||||||
Inter-segment revenue - Services | 7 | 60 | (67) | 8 | 68 | (76) | |||||||||||
Segment revenue - Equipment | 317 | 68 | 385 | 276 | 60 | 336 | |||||||||||
Total revenues | 1,150 | 590 | (67) | 1,673 | 1,108 | 549 | (76) | 1,581 | |||||||||
Segment cost of revenues - Services | 615 | 468 | 1,083 | 640 | 399 | 1,039 | |||||||||||
Inter-segment cost of revenues - Services | 60 | 7 | (67) | 68 | 8 | (76) | |||||||||||
Segment cost of revenues - Equipment | 264 | 40 | 304 | 229 | 40 | 269 | |||||||||||
Cost of revenues | 939 | 515 | (67) | 1,387 | 937 | 447 | (76) | 1,308 | |||||||||
Gross profit | 211 | 75 | 286 | 171 | 102 | 273 | |||||||||||
Operating expenses (3) | 145 | 98 | 243 | 155 | 75 | 230 | |||||||||||
Other income, net | 8 | 7 | 15 | 10 | 3 | 13 | |||||||||||
Operating profit (loss) | 74 | (16) | 58 | 26 | 30 | 56 | |||||||||||
Adjustments to presentation of segment Adjusted EBITDA | |||||||||||||||||
–Depreciation and amortization | 205 | 155 | 229 | 124 | |||||||||||||
–Other (1) | 3 | 1 | 6 | ||||||||||||||
Segment Adjusted EBITDA (2) | 282 | 140 | 261 | 154 | |||||||||||||
Reconciliation of segment subtotal Adjusted | |||||||||||||||||
Segments subtotal Adjusted EBITDA(2) | 422 | 415 | |||||||||||||||
- Depreciation and amortization | (360) | (353) | |||||||||||||||
- Finance costs, net | (35) | (32) | |||||||||||||||
- Income tax income (expenses) | (9) | (7) | |||||||||||||||
- Other (1) | (4) | (6) | |||||||||||||||
Profit for the period | 14 | 17 | |||||||||||||||
PARTNER COMMUNICATIONS COMPANY LTD. | |||||||||||||||||
(An Israeli Corporation) | |||||||||||||||||
INTERIM SEGMENT INFORMATION & ADJUSTED EBITDA RECONCILIATION | |||||||||||||||||
New Israeli Shekels | New Israeli Shekels | ||||||||||||||||
3 months period ended June 30, 2021 | 3 months period ended June 30, 2020 | ||||||||||||||||
In millions (Unaudited) | In millions (Unaudited) | ||||||||||||||||
Cellular | Fixed line | Elimination | Consolidated | Cellular | Fixed line | Elimination | Consolidated | ||||||||||
Segment revenue - Services | 417 | 232 | 649 | 405 | 211 | 616 | |||||||||||
Inter-segment revenue - Services | 3 | 30 | (33) | 4 | 33 | (37) | |||||||||||
Segment revenue - Equipment | 157 | 34 | 191 | 130 | 28 | 158 | |||||||||||
Total revenues | 577 | 296 | (33) | 840 | 539 | 272 | (37) | 774 | |||||||||
Segment cost of revenues - Services | 309 | 235 | 544 | 318 | 207 | 525 | |||||||||||
Inter-segment cost of revenues - Services | 30 | 3 | (33) | 33 | 4 | (37) | |||||||||||
Segment cost of revenues - Equipment | 132 | 20 | 152 | 110 | 18 | 128 | |||||||||||
Cost of revenues | 471 | 258 | (33) | 696 | 461 | 229 | (37) | 653 | |||||||||
Gross profit | 106 | 38 | 144 | 78 | 43 | 121 | |||||||||||
Operating expenses (3) | 74 | 48 | 122 | 70 | 38 | 108 | |||||||||||
Other income, net | 3 | 5 | 8 | 5 | 2 | 7 | |||||||||||
Operating profit (loss) | 35 | (5) | 30 | 13 | 7 | 20 | |||||||||||
Adjustments to presentation of segment Adjusted EBITDA | |||||||||||||||||
–Depreciation and amortization | 102 | 79 | 114 | 64 | |||||||||||||
–Other (1) | 2 | 2 | |||||||||||||||
Segment Adjusted EBITDA (2) | 139 | 74 | 129 | 71 | |||||||||||||
Reconciliation of segment subtotal Adjusted | |||||||||||||||||
Segments subtotal Adjusted EBITDA (2) | 213 | 200 | |||||||||||||||
- Depreciation and amortization | (181) | (178) | |||||||||||||||
- Finance costs, net | (16) | (13) | |||||||||||||||
- Income tax expenses | (5) | * | |||||||||||||||
- Other (1) | (2) | (2) | |||||||||||||||
Profit for the period | 9 | 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 and general and administrative expenses.
PARTNER COMMUNICATIONS COMPANY LTD. | |||
(An Israeli Corporation) | |||
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||
New Israeli Shekels | Convenience | ||
6 months period ended June 30, | |||
2020 | 2021 | 2021 | |
(Unaudited) | (Unaudited) | (Unaudited) | |
In millions | |||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Cash generated from operations (Appendix) | 398 | 388 | 119 |
Income tax paid | (1) | (1) | * |
Net cash provided by operating activities | 397 | 387 | 119 |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Acquisition of property and equipment | (192) | (208) | (64) |
Acquisition of intangible and other assets | (78) | (80) | (24) |
Investment in deposits, net | (55) | 50 | 15 |
Interest received | 3 | 1 | * |
Net cash used in investing activities | (322) | (237) | (73) |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Lease principal payments | (67) | (64) | (19) |
Lease interest payments | (9) | (9) | (3) |
Interest paid | (33) | (42) | (13) |
Share issuance, net of issuance costs | 276 | ||
Advances on account of notes payables issuance | 11 | ||
Proceeds from issuance of notes payable, net of issuance costs | 88 | 23 | 7 |
Repayment of notes payable | (204) | (128) | (39) |
Repayment of non-current borrowings | (26) | (26) | (8) |
Settlement of contingent consideration | (1) | ||
Net cash provided by financing activities | 35 | (246) | (75) |
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 110 | (96) | (29) |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 299 | 376 | 115 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 409 | 280 | 86 |
* Representing an amount of less than 1 million.
PARTNER COMMUNICATIONS COMPANY LTD. | ||||
(An Israeli Corporation) | ||||
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
Appendix - Cash generated from operations and supplemental information | ||||
New Israeli Shekels | Convenience | |||
6 months period ended June 30, | ||||
2020 | 2021 | 2021 | ||
(Unaudited) | (Unaudited) | (Unaudited) | ||
In millions | ||||
Cash generated from operations: | ||||
Profit for the period | 17 | 14 | 4 | |
Adjustments for: | ||||
Depreciation and amortization | 338 | 345 | 106 | |
Amortization of deferred expenses - Right of use | 15 | 15 | 5 | |
Employee share based compensation expenses | 5 | 4 | 1 | |
Liability for employee rights upon retirement, net | (1) | 5 | 2 | |
Finance costs, net | (1) | (2) | (1) | |
Lease interest payments | 9 | 9 | 3 | |
Interest paid | 33 | 42 | 13 | |
Interest received | (3) | (1) | * | |
Deferred income taxes | 6 | 7 | 2 | |
Income tax paid | 1 | 1 | * | |
Changes in operating assets and liabilities: | ||||
Decrease (increase) in accounts receivable: | ||||
Trade | 87 | (31) | (9) | |
Other | 1 | 15 | 5 | |
Increase (decrease) in accounts payable and accruals: | ||||
Trade | (33) | 20 | 6 | |
Other payables | (30) | 8 | 2 | |
Provisions | (7) | 1 | * | |
Deferred revenues from HOT mobile | (16) | (16) | (5) | |
Other deferred revenues | 12 | (2) | (1) | |
Increase in deferred expenses - Right of use | (28) | (29) | (9) | |
Current income tax | 1 | 1 | * | |
Decrease (increase) in inventories | (8) | (18) | (5) | |
Cash generated from operations | 398 | 388 | 119 | |
* Representing an amount of less than 1 million.
At June 30, 2021 and 2020, trade and other payables include NIS 170 million (
These balances are recognized in the cash flow statements upon payment.
Reconciliation of Non-GAAP Measures: | ||||||
Adjusted Free Cash Flow | New Israeli Shekels | Convenience translation | ||||
6 months period ended June 30, | 3 months period ended June 30, | 6 months period ended June 30, | 3 months period ended June 30, | |||
2020 | 2021 | 2020 | 2021 | 2021 | 2021 | |
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |
In millions | ||||||
Net cash provided by operating activities | 397 | 387 | 193 | 179 | 119 | 55 |
Net cash provided by (used in) investing activities | (322) | (237) | 70 | (19) | (73) | (6) |
Investment in short-term deposits, net | 55 | (50) | (186) | (120) | (15) | (37) |
Lease principal payments | (67) | (64) | (29) | (28) | (19) | (9) |
Lease interest payments | (9) | (9) | (4) | (4) | (3) | (1) |
Adjusted Free Cash Flow | 54 | 27 | 44 | 8 | 9 | 2 |
Interest paid | (33) | (42) | (31) | (41) | (13) | (12) |
Adjusted Free Cash Flow After Interest | 21 | (15) | 13 | (33) | (4) | (10) |
Total Operating Expenses (OPEX) | New Israeli Shekels | Convenience translation | ||||
6 months period ended June 30, | 3 months period ended June 30, | 6 months June 30, | 3 months June 30, | |||
2020 | 2021 | 2020 | 2021 | 2021 | 2021 | |
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |
In millions | ||||||
Cost of revenues - Services | 1,039 | 1,083 | 525 | 544 | 333 | 168 |
Selling and marketing expenses | 140 | 157 | 69 | 78 | 48 | 24 |
General and administrative expenses | 90 | 86 | 39 | 44 | 26 | 13 |
Depreciation and amortization | (353) | (360) | (178) | (181) | (111) | (56) |
Other (1) | * | (1) | 1 | * | * | * |
OPEX | 916 | 965 | 456 | 485 | 296 | 149 |
* Representing an amount of less than 1 million.
(1) Mainly amortization of employee share based compensation and other adjustments.
Key Financial and Operating Indicators (unaudited) * | ||||||||||||
NIS M unless otherwise stated | Q2' 19 | Q3' 19 | Q4' 19 | Q1' 20 | Q2' 20 | Q3' 20 | Q4' 20 | Q1' 21 | Q2' 21 | 2019 | 2020 | |
Cellular Segment Service Revenues | 453 | 466 | 438 | 423 | 409 | 415 | 416 | 413 | 420 | 1,798 | 1,663 | |
Cellular Segment Equipment Revenues | 115 | 142 | 172 | 146 | 130 | 134 | 135 | 160 | 157 | 571 | 545 | |
Fixed-Line Segment Service Revenues | 230 | 233 | 238 | 245 | 244 | 252 | 252 | 260 | 262 | 925 | 993 | |
Fixed-Line Segment Equipment Revenues | 24 | 25 | 26 | 32 | 28 | 35 | 41 | 34 | 34 | 103 | 136 | |
Reconciliation for consolidation | (41) | (41) | (40) | (39) | (37) | (36) | (36) | (34) | (33) | (163) | (148) | |
Total Revenues | 781 | 825 | 834 | 807 | 774 | 800 | 808 | 833 | 840 | 3,234 | 3,189 | |
Gross Profit from Equipment Sales | 35 | 33 | 37 | 37 | 30 | 38 | 40 | 42 | 39 | 144 | 145 | |
Operating Profit | 22 | 26 | 30 | 36 | 20 | 20 | 20 | 28 | 30 | 87 | 96 | |
Cellular Segment Adjusted EBITDA | 159 | 170 | 156 | 132 | 129 | 134 | 138 | 143 | 139 | 635 | 533 | |
Fixed-Line Segment Adjusted EBITDA | 55 | 55 | 61 | 83 | 71 | 70 | 65 | 66 | 74 | 218 | 289 | |
Total Adjusted EBITDA | 214 | 225 | 217 | 215 | 200 | 204 | 203 | 209 | 213 | 853 | 822 | |
Adjusted EBITDA Margin (%) | ||||||||||||
OPEX | 472 | 474 | 467 | 460 | 456 | 475 | 480 | 481 | 485 | 1,885 | 1,871 | |
Finance costs, net | 16 | 18 | 20 | 19 | 13 | 24 | 13 | 19 | 16 | 68 | 69 | |
Profit (Loss) | 3 | 7 | 7 | 10 | 7 | (5) | 5 | 5 | 9 | 19 | 17 | |
Capital Expenditures (cash) | 143 | 174 | 127 | 151 | 119 | 147 | 156 | 149 | 139 | 629 | 573 | |
Capital Expenditures (additions) | 142 | 150 | 129 | 129 | 121 | 179 | 166 | 142 | 182 | 578 | 595 | |
Adjusted Free Cash Flow | 31 | 13 | 16 | 10 | 44 | 21 | (3) | 19 | 8 | 49 | 72 | |
Adjusted Free Cash Flow (after interest) | 15 | 12 | 0 | 8 | 13 | 12 | (10) | 18 | (33) | 12 | 23 | |
Net Debt | 965 | 956 | 957 | 673 | 658 | 646 | 657 | 639 | 670 | 957 | 657 | |
Cellular Subscriber Base (Thousands) | 2,616 | 2,651 | 2,657 | 2,676 | 2,708 | 2,762 | 2,836 | 2,903 | 2,970 | 2,657 | 2,836 | |
Post-Paid Subscriber Base (Thousands) | 2,337 | 2,366 | 2,366 | 2,380 | 2,404 | 2,437 | 2,495 | 2,548 | 2,615 | 2,366 | 2,495 | |
Pre-Paid Subscriber Base (Thousands) | 279 | 285 | 291 | 296 | 304 | 325 | 341 | 355 | 355 | 291 | 341 | |
Cellular ARPU (NIS) | 58 | 59 | 55 | 53 | 51 | 51 | 49 | 48 | 48 | 57 | 51 | |
Cellular Churn Rate (%) | ||||||||||||
Infrastructure-Based Internet Subscribers (Thousands) | 268 | 281 | 295 | 311 | 329 | 339 | 354 | 268 | 329 | |||
Fiber-Optic Subscribers (Thousands) | 76 | 87 | 101 | 120 | 139 | 155 | 173 | 76 | 139 | |||
Homes connected to fiber-optic infrastructure | 324 | 361 | 396 | 432 | 465 |
514 | 571 | 324 | 465 | |||
TV Subscriber Base (Thousands) | 160 | 176 | 188 | 200 | 215 | 224 | 232 | 234 | 223** | 188 | 232 | |
Number of Employees (FTE) | 2,895 | 2,923 | 2,834 | 1,867 | 2,745 | 2,731 | 2,655 | 2,708 | 2,628 | 2,834 | 2,655 | |
* See footnote 2 regarding use of non-GAAP measures.
** In Q2'21, the Company removed from its TV subscriber base approximately 21,000 subscribers who had joined the company at various different times and had remained in trial periods of over six months without charge or usage.
Disclosure for notes holders as of June 30, 2021 | ||||||||||||
Information regarding the notes series issued by the Company, in million NIS | ||||||||||||
Series | Original | Principal on issuance | As of 30.06.2021 | Annual interest | Principal | Interest | Interest linkage | Trustee contact details | ||||
Principal | Linked principal | Interest | 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, | Variable interest | Hermetic Trust (1975) Ltd. |
F (2) | 20.07.17 12.12.17* 04.12.18* 01.12.19* | 255 389 150 226.75 | 384 | 384 | ** | 394 | 25.06.20 | 25.06.24 | 25.06, 25.12 | Not Linked | Hermetic Trust (1975) Ltd. Merav Offer. 113 Hayarkon St., | |
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* 31.05.21* | 225 38.5 86.5 15.1 84.8 12.2 300 62.2 26.5 | 851 | 851 | 1 | 938 | 25.06.22 | 25.06.27 | 25.06 | Not Linked | Hermetic Trust (1975) Ltd. Merav Offer. 113 Hayarkon St., | |
(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, November 2020 and May 2021, the Company issued Series G Notes in a principal amount of NIS 12.2 million, NIS 62.2 million and NIS 26.5 million, respectively. The issuance in May 2021 was the final exercise of option warrants from the second 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 June 30, 2021, 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) '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 June 30, 2021 (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- | 08/2021 | 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, 05/2021, 08/2021 | ilAA-, ilAA-, ilAA-, ilAA-, ilAA-, ilAA-, ilAA-, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+ |
F | S&P Maalot | ilA+ | ilA+ | 08/2021 | 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, 05/2021, 08/2021 | ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+ |
G (3) | S&P Maalot | ilA+ | ilA+ | 08/2021 | 12/2018, 01/2019, 04/2019, 08/2019, 02/2020, 05/2020, 06/2020, 07/2020, 08/2020, 11/2020, 05/2021, 08/2021 | ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+ |
(1) In August 2021, S&P Maalot reaffirmed the Company's rating of "ilA+/Stable".
(2) For details regarding the rating of the notes see the S&P Maalot reports dated August 11, 2021.
(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, November 2020 and May 2021 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, NIS 62.2 million and NIS 26.5 million, respectively.
* 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 June 30, 2021
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 | - | 322,213 | - | - | - | 42,988 |
Second year | - | 212,985 | - | - | - | 36,155 |
Third year | - | 212,985 | - | - | - | 30,064 |
Fourth year | - | 85,083 | - | - | - | 23,823 |
Fifth year and on | - | 510,501 | - | - | - | 34,033 |
Total | - | 1,343,767 | - | - | - | 167,063 |
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 | ILS not linked | Euro | Dollar | Other | ||
First year | - | 52,132 | - | - | - | 2,282 |
Second year | - | 37,426 | - | - | - | 1,055 |
Third year | - | 22,760 | - | - | - | 357 |
Fourth year | - | - | - | - | - | - |
Fifth year and on | - | - | - | - | - | - |
Total | - | 112,318 | - | - | - | 3,694 |
Summary of Financial Undertakings (according to repayment dates) as of June 30, 2021 (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 | - | 374,345 | - | - | - | 45,270 |
Second year | - | 250,411 | - | - | - | 37,210 |
Third year | - | 235,745 | - | - | - | 30,421 |
Fourth year | - | 85,083 | - | - | - | 23,823 |
Fifth year and on | - | 510,501 | - | - | - | 34,033 |
Total | - | 1,456,085 | - | - | - | 170,757 |
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.
[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.
View original content:https://www.prnewswire.com/news-releases/partner-communications-reports-second-quarter-2021-results1-301357608.html
SOURCE Partner Communications Company Ltd.
FAQ
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