PARTNER COMMUNICATIONS REPORTS THIRD QUARTER 2022 RESULTS[1]
Partner Communications Company Ltd. (PTNR) announced its Q3 2022 results, reporting total revenues of NIS 891 million, a 6% increase year-over-year. Adjusted EBITDA rose by 10% to NIS 276 million, while profit surged 113% to NIS 51 million. Cellular subscriber base increased to approximately 3.04 million, though a net decrease of 53,000 was noted, mainly due to the expiry of temporary Ministry of Education packages. Fiber-optic subscribers grew to 268,000, reflecting continued growth in fixed-line services. Net debt stood at NIS 667 million, with free cash flow of NIS 38 million.
- Total revenues increased by 6% to NIS 891 million.
- Adjusted EBITDA rose by 10% to NIS 276 million.
- Profit increased by 113% to NIS 51 million.
- Fiber-optic subscriber base expanded by 18,000, reaching 268,000.
- Cellular subscriber base declined by 53,000, largely due to expired Ministry of Education packages.
- Increased operational expenses (OPEX) to NIS 495 million, a 6% rise.
ROSH HA'AYIN, Israel, Nov. 23, 2022 /PRNewswire/ --
QUARTERLY ADJUSTED EBITDA[2] TOTALED NIS 276 MILLION
QUARTERLY PROFIT TOTALED NIS 51 MILLION
ADJUSTED FREE CASH FLOW (BEFORE INTEREST)[2] FOR THE FIRST 9 MONTHS OF THE YEAR TOTALED NIS 120 MILLION
NET DEBT[2] TOTALED NIS 667 MILLION
CELLULAR SUBSCRIBER BASE AT THE END OF THE THIRD QUARTER TOTALED APPROXIMATELY 3.04 MILLION
THE NUMBER OF HOUSEHOLDS IN BUILDINGS CONNECTED TO PARTNER'S FIBER-OPTIC INFRASTRUCTURE TOTALS 929 THOUSAND AS OF TODAY
Third quarter 2022 highlights (compared with third quarter 2021)
- Total Revenues: NIS 891 million (US
$ 252 million ), an increase of6% - Service Revenues: NIS 728 million (US
$ 206 million ), an increase of8% - Equipment Revenues: NIS 163 million (US
$ 46 million ), a decrease of1% - Total Operating Expenses (OPEX)[2]: NIS 495 million (US
$ 140 million ), an increase of6% - Adjusted EBITDA: NIS 276 million (US
$ 78 million ), an increase of10% - Profit for the Period: NIS 51 million (US
$ 15 million ), an increase of113% - Adjusted Free Cash Flow (before interest): NIS 38 million (US
$ 11 million ), an increase of NIS 29 million - Cellular ARPU: NIS 51 (US
$ 14) , an increase of6% - Cellular Subscriber Base: approximately 3.04 million subscribers at quarter-end, an increase of
1% - Fiber-Optic Subscriber Base: 268 thousand subscribers at quarter-end, an increase of 76 thousand since Q3 2021, and an increase of 18 thousand in the quarter
- Homes Connected (HC) to Partner's Fiber-Optic Infrastructure: 900 thousand at quarter-end, an increase of 276 thousand since Q3 2021, and an increase of 63 thousand in the quarter
- Infrastructure-Based Internet Subscriber Base: 403 thousand subscribers at quarter-end, an increase of 38 thousand since Q3 2021, and an increase of 8 thousand in the quarter
- TV Subscriber Base: 222 thousand subscribers at quarter-end, a decrease of 4 thousand subscribers since Q3 2021, and a decrease of 2 thousand in the 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 September 30, 2022.
Commenting on the results for the third quarter 2022, Mr. Avi Gabbay, CEO of Partner, noted:
"Partner continues to report growth and stability in the financial results together with continued investment in fiber-optics and 5G deployment. Correspondingly, in these days we have concluded the formalization of the company's management team while staying focused on further service improvements for our customers."
Ms. Sigal Tzadok, Partner's Acting Chief Financial Officer, commented on the results:
"The revenues growth in both the cellular and fixed-line segments compared to the corresponding quarter last year was the result of a stronger seasonality impact on the third quarter in the cellular segment, and the continued growth in fiber-optics subscribers. Along with the growth in revenues, we continued to control the level of OPEX and thus despite high one-time expenses in the quarter, in the amount of NIS 17 million due to the collective employment agreement that was signed in July 2022, we succeeded in bringing about in the quarter an increase of
Partner continues with the expedited 5G infrastructure deployment and expects to achieve over
The fiber-optic deployment continues to be a growth engine for the Company. The number of Homes Connected within buildings connected to our fiber-optic infrastructure reached 900 thousand at the end of third quarter of 2022, an increase of 63 thousand in the quarter. As of today, the number of Homes Connected within buildings connected to our fiber-optic infrastructure totals 929 thousand.
The fiber-optic subscriber base totaled 268 thousand at the end of the quarter, reflecting a
Adjusted Free Cash Flow (before interest and including lease payments) for the quarter totaled NIS 38 million. CAPEX payments in the third quarter of 2022 totaled NIS 205 million, including a payment for the 5G license fee in the amount of NIS 31 million related to the tender that was held two years ago.
Net debt was NIS 667 million at the end of the quarter, compared with NIS 662 million at the end of the corresponding quarter. The Company's net debt to Adjusted EBITDA ratio stood at 0.6 at the end of the quarter, compared to a ratio of 0.8 in the corresponding quarter last year."
Q3 2022 compared with Q3 2021
NIS Million (except EPS) | Q3'21 | Q3'22 | Comments |
Service Revenues | 672 | 728 | The increase reflected growth in both cellular |
Equipment Revenues | 165 | 163 | The decrease reflected lower sales in the |
Total Revenues | 837 | 891 | |
Gross profit from equipment sales | 37 | 33 | |
OPEX | 467 | 495 | The increase mainly reflected an increase in |
Operating profit | 49 | 84 | |
Adjusted EBITDA | 250 | 276 | |
Adjusted EBITDA as a percentage of total revenues | 30 % | 31 % | |
Profit for the period | 24 | 51 | |
Earnings per share (basic, NIS) | 0.13 | 0.28 | |
Capital Expenditures (cash) | 172 | 205 | |
Adjusted free cash flow (before interest payments) | 9 | 38 | |
Net Debt | 662 | 667 |
Key Performance Indicators
Q3'21 | Q2'22 | Q3'22 | Change Q2 to Q3 | |
Reported Cellular Subscribers | 3,019 | 3,095 | 3,042 | Post-Paid: Decrease of 54 thousand |
Cellular Subscribers (end of | 2,926 | 3,015 | 3,028 | Post-Paid: Increase of 12 thousand |
Monthly Average Revenue per | 48 | 49 | 51 | |
Reported Quarterly Cellular | 6.4 % | 6.7 % | 8.9 % | |
Quarterly Cellular Churn Rate (%) | 6.6 % | 6.6 % | 6.8 % | |
Fiber-Optic Subscribers (end of | 192 | 250 | 268 | Increase of 18 thousand subscribers |
Homes Connected to the Fiber- | 624 | 837 | 900 | Increase of 63 thousand households |
Infrastructure-Based Internet | 365 | 395 | 403 | Increase of 8 thousand subscribers |
TV Subscribers (end of period, | 226 | 224 | 222 | Decrease of 2 thousand subscribers |
Partner Consolidated Results
Cellular Segment | Fixed-Line Segment | Elimination | Consolidated | ||||||||
NIS Million | Q3'21 | Q3'22 | Change % | Q3'21 | Q3'22 | Change % | Q3'21 | Q3'22 | Q3'21 | Q3'22 | Change % |
Total Revenues | 571 | 607 | +6 % | 299 | 315 | +5 % | (33) | (31) | 837 | 891 | +6 % |
Service Revenues | 435 | 474 | +9 % | 270 | 285 | +6 % | (33) | (31) | 672 | 728 | +8 % |
Equipment Revenues | 136 | 133 | -2 % | 29 | 30 | +3 % | - | - | 165 | 163 | -1 % |
Operating Profit (Loss) | 66 | 76 | +15 % | (17) | 8 | - | - | 49 | 84 | +71 % | |
Adjusted EBITDA | 172 | 179 | +4 % | 78 | 97 | +24 % | - | - | 250 | 276 | +10 % |
Financial Review
In Q3 2022, total revenues were NIS 891 million (US
Service revenues in Q3 2022 totaled NIS 728 million (US
Service revenues for the cellular segment in Q3 2022 totaled NIS 474 million (US
Service revenues for the fixed-line segment in Q3 2022 totaled NIS 285 million (US
Equipment revenues in Q3 2022 totaled NIS 163 million (US
Gross profit from equipment sales in Q3 2022 was NIS 33 million (US
Total operating expenses ('OPEX') totaled NIS 495 million (US
Operating profit for Q3 2022 was NIS 84 million (US
Adjusted EBITDA in Q3 2022 totaled NIS 276 million (US
Adjusted EBITDA for the cellular segment was NIS 179 million (US
Adjusted EBITDA for the fixed-line segment was NIS 97 million (US
Finance costs, net in Q3 2022 were NIS 15 million (US
Income tax expenses in Q3 2022 were NIS 18 million (US
Profit in Q3 2022 was NIS 51 million (US
Based on the weighted average number of shares outstanding during Q3 2022, basic earnings per share or ADS, was NIS 0.28 (US
Cellular Segment Operational Review
At the end of Q3 2022, the Company's cellular subscriber base (including mobile data, 012 Mobile subscribers and M2M subscriptions) was approximately 3.04 million, including approximately 2.68 million Post-Paid subscribers or
During the third quarter of 2022, the cellular subscriber base declined, net, by approximately 53 thousand subscribers. The Post-Paid subscriber base declined, net, by approximately 54 thousand subscribers and the Pre-Paid subscriber base increased, net, by approximately one thousand subscribers. As was stated in the Q2 2022 results release, most of the time-limited packages for the Ministry of Education (MOE) reached their expiry date in the third quarter of 2022; as a result, the subscriber base of data and voice packages for the MOE decreased by 66 thousand and totaled 14 thousand at the end of Q3 2022.
Total cellular market share (based on the number of subscribers) at the end of Q3 2022 was estimated to be approximately
The quarterly churn rate for cellular subscribers in Q3 2022 was
The monthly Average Revenue per User ("ARPU") for cellular subscribers in Q3 2022 was NIS 51 (US
Fixed-Line Segment Operational Review
At the end of Q3 2022:
- The Company's fiber-optic subscriber base was 268 thousand subscribers, an increase, net, of 18 thousand subscribers during the third quarter of 2022.
- The Company's infrastructure-based internet subscriber base was 403 thousand subscribers, an increase, net, of 8 thousand subscribers during the third quarter of 2022.
- Households in buildings connected to our fiber-optic infrastructure (HC) totaled 900 thousand, an increase, net, of 63 thousand during the third quarter of 2022.
- The Company's TV subscriber base totaled 222 thousand subscribers, a decrease, net, of 2 thousand subscribers during the third quarter of 2022.
Funding and Investing Review
In Q3 2022, Adjusted Free Cash Flow (including lease payments) totaled NIS 38 million (US
Cash generated from operating activities totaled NIS 279 million (US
Lease payments (principal and interest) recorded in cash flows from financing activities under IFRS 16 totaled NIS 37 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 205 million (US
The level of net debt at the end of Q3 2022 amounted to NIS 667 million (US
Regulatory Developments
Draft bill on the principles of regulation of audio-visual content provided to the public, 2022
Further to Item 4B.12e-iv of the Company's 2021 annual report regarding the report of the committee assigned with re-examining the overall regulatory regime applicable to the broadcasting segment ("Folkman Committee"), on August 9 2022, the Ministry of Communications published a hearing for public comment regarding the draft bill on the principles of regulation of audio-visual content provided to the public, 2022 ("the Hearing").
According to the Hearing and the explanatory notes to the draft bill, the bill is intended to amend current legislation in accordance with the Folkman Committee's recommendations and to update the set of obligations and rights applicable to all players operating in the audio-visual content market in a number of ways, including the proposal that audiovisual content providers which provide their services over the internet would be required to invest in local productions (and be subject to additional regulations) in a gradual manner, in accordance with their annual income from providing content. A content provider with a medium scope of activity (whose total annual income from content provision is between NIS 300 and 600 million) will be required to invest
Partner is studying the Hearing document and its implications. Since this is a Hearing and there is no certainty whether the Hearing will mature into binding legislation and what the contents and provisions of such legislation may be, it is difficult at this stage to assess the extent of impact that this bill might have on the Company's business (if it becomes binding).
Allocation of frequencies to non-public networks - Innovation band hearing
On August 14, 2022, the Ministry of Communications published a hearing regarding the allocation of frequencies to non-public wireless access networks ("the Hearing"). Non-public networks are cellular networks that are limited to a defined area, and on which only devices which have been pre-approved or pre-defined by the network operator may operate. Such networks are usually used by businesses and large organizations (such as ports, hospitals, factories, etc.). In the Hearing, the Ministry proposes to open the cellular market to the entry of new players through the allocation of frequencies for local use in non-public networks, all in order to encourage technological innovation in advanced services and applications and to improve economic productivity of the market. Partner has submitted its position regarding this Hearing and has objected to the provisions proposed in it. The entry of new players and the deployment of non-public cellular networks might harm the economic incentive for the deployment of Partner's fifth generation network.
Ownership of the mobile radio telephony (cellular) network-hearing
The current provisions of cellular licenses in Israel state that the licensee shall be the owner of the cellular network by which it provides these services to its subscribers. On August 16, 2022, the Ministry of Communications published a hearing on the subject of ownership of the cellular, MRT networks ("the Hearing"). As part of the Hearing, the Ministry proposes to amend the cellular licenses in Israel so that in the future the licensee will no longer be required to be the owner of the cellular network. According to the Hearing, the Ministry is considering allowing entrepreneurs to establish cellular sites on top of existing street infrastructure facilities (such as light poles, electricity poles, signs and bus stops), and such entrepreneurs will own the cell site that will be deployed, which they will rent in one form or another to the cellular companies.
Partner has submitted its position regarding this Hearing and has objected to the provisions proposed in it. The deployment of cellular infrastructures by private entrepreneurs on existing street infrastructures might impede the deployment of Partner's fifth generation network in these infrastructures and increase the acquisition costs for such sites.
Decision regarding the telecommunications regulations (Telecommunications and Broadcasting) general permit for the provision of a telecommunications service, 2022
On October 2, 2022, the Communications Regulations (Telecommunications and Broadcasting) a general authorization for the provision of telecommunications services, 2022 ("the Regulations") was enacted. The Regulations set the procedures for registration in the registry and the terms of the general authorization document ("General Authorization") which will apply to registered service providers. According to the Regulations, their provision will not apply to existing licensees, and therefore Partner's main activities will not be regulated through registration in the registry, but will remain subject to its licenses. According to the explanatory notes to the Regulations, the Ministry of Communications intends to map out the existing licenses and actively cancel provisions in them that are expressly regulated by the Regulations, however this process is expected to be completed only in the first quarter of 2023. It should be noted that most of the provisions of the Regulations include lenient provisions in comparison to the provisions of the existing licenses, however some of these provisions are burdensome in comparison to the provisions of the licenses. These burdensome provisions include, among others, an obligation to disconnect "dormant subscribers" from Internet access services (subscribers who continue to pay a monthly fee for the service without using the service) provided that they have not used the service for six months, as well as an obligation to inform the subscriber of his right to receive a copy of any telephone conversation with the service center and provide it to the subscriber within 5 business days. Insofar as it will be determined that such obligations apply to Partner, they are not expected to have a material effect on the Company. However, the effect of the transition to the terms of the General Authorization and the subsequent license amendments depends, among others, on how this change is implemented by the Ministry of Communications and also on the wording of the expected amendments to the licenses (during the first quarter of 2023).
Conference Call Details
Partner will host a conference call to discuss its financial results on Wednesday, November 23 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: +1.888.407.2553
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 November 23, 2022 until December 7, 2022, 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 Company's continued investment in fiber optics; (ii) the continued expedited deployment of the 5G infrastructure and obtaining
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 remaining impact on our business of the Covid-19 health crisis, (ii) unexpected technical or commercial issues which may arise as we continue to deploy and expand the use of our fiber optic infrastructure; and (iii) unexpected technical or financial constraints which undermine the pursuit of such strategy. In light of the current unreliability of predictions as to the ultimate severity and duration of the Covid-19 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 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 September 30, 2022: 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 IFRS |
Adjusted EBITDA
| Profit add Income tax expenses, Finance costs, net, Depreciation and amortization expenses
Adjusted EBITDA divided by Total revenues | Profit |
Adjusted EBITDA margin (%)
| ||
Adjusted Free Cash Flow | Cash flows from operating activities add Cash flows from investing activities deduct Investment in deposits, net deduct Lease principal payments deduct Lease interest payments | Cash flows from operating activities add Cash flows from investing activities |
Total Operating Expenses (OPEX) | Cost of service revenues add Selling and marketing expenses add General and administrative expenses add Credit losses deduct Depreciation and amortization expenses, Other expenses (mainly amortization of | Sum of: Cost of service revenues, Selling and marketing expenses, General and administrative expenses, Credit losses
|
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 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:
Sigal Tzadok Acting Chief Financial Officer Tel: +972-54-781-4951
| 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, | September 30, | September 30, | ||
2021 | 2022 | 2022 | ||
(Audited) | (Unaudited) | (Unaudited) | ||
In millions | ||||
CURRENT ASSETS | ||||
Cash and cash equivalents | 308 | 549 | 155 | |
Short-term deposits | 344 | 206 | 58 | |
Trade receivables | 571 | 599 | 169 | |
Other receivables and prepaid expenses | 152 | 91 | 26 | |
Deferred expenses – right of use | 27 | 31 | 9 | |
Inventories | 87 | 99 | 28 | |
1,489 | 1,575 | 445 | ||
NON CURRENT ASSETS | ||||
Long-term deposits | 280 | |||
Trade receivables | 245 | 215 | 61 | |
Deferred expenses – right of use | 142 | 164 | 46 | |
Lease – right of use | 679 | 670 | 189 | |
Property and equipment | 1,644 | 1,749 | 494 | |
Intangible and other assets | 472 | 437 | 123 | |
Goodwill | 407 | 407 | 115 | |
Deferred income tax asset | 34 | 24 | 7 | |
Other non-current receivables | 1 | * | * | |
3,904 | 3,666 | 1,035 | ||
TOTAL ASSETS | 5,393 | 5,241 | 1,480 | |
* Representing an amount of less than 1 million.
PARTNER COMMUNICATIONS COMPANY LTD. | ||||
(An Israeli Corporation) | ||||
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION | ||||
New Israeli Shekels | Convenience | |||
December 31, | September 30, | September 30, | ||
2021 | 2022 | 2022 | ||
(Audited) | (Unaudited) | (Unaudited) | ||
In millions | ||||
CURRENT LIABILITIES | ||||
Current maturities of notes payable and borrowings | 268 | 245 | 69 | |
Trade payables | 705 | 661 | 187 | |
Other payables and provisions | 185 | 205 | 58 | |
Current maturities of lease liabilities | 125 | 130 | 37 | |
Deferred revenues and other | 139 | 149 | 42 | |
1,422 | 1,390 | 393 | ||
NON CURRENT LIABILITIES | ||||
Notes payable | 1,224 | 1,010 | 285 | |
Borrowings from banks | 184 | 167 | 47 | |
Liability for employee rights upon retirement, net | 35 | 31 | 9 | |
Lease liabilities | 595 | 580 | 163 | |
Deferred revenues from HOT mobile | 39 | 16 | 5 | |
Non-current liabilities and provisions | 35 | 33 | 9 | |
2,112 | 1,837 | 518 | ||
TOTAL LIABILITIES | 3,534 | 3,227 | 911 | |
EQUITY | ||||
Share capital - ordinary shares of NIS 0.01 par value: authorized - December 31, 2021 and September 30, 2022 - 235,000,000 shares; issued and outstanding - | 2 | 2 | 1 | |
December 31, 2021 – *183,678,220 shares | ||||
September 30, 2022 – *185,437,628 shares | ||||
Capital surplus | 1,279 | 1,221 | 345 | |
Accumulated retained earnings | 742 | 897 | 253 | |
Treasury shares, at cost December 31, 2021 – **7,337,759 shares | (164) | (106) | (30) | |
TOTAL EQUITY | 1,859 | 2,014 | 569 | |
TOTAL LIABILITIES AND EQUITY | 5,393 | 5,241 | 1,480 | |
* Net of treasury shares.
** Including restricted shares in amount of 1,349,119 and 527,589 as of December 31, 2021 and September 30, 2022, 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 | ||||||
9 months period ended September 30, | 3 months period ended September 30, | 9 months period ended September 30, | 3 months period ended September 30, | ||||
2021 | 2022 | 2021 | 2022 | 2022 | 2022 | ||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||
In millions (except per share data) | |||||||
Revenues, net | 2,510 | 2,604 | 837 | 891 | 735 | 252 | |
Cost of revenues | 2,054 | 1,993 | 667 | 672 | 563 | 190 | |
Gross profit | 456 | 611 | 170 | 219 | 172 | 62 | |
Selling and marketing expenses | 238 | 268 | 81 | 93 | 75 | 26 | |
General and administrative expenses | 132 | 124 | 46 | 49 | 35 | 14 | |
Other income, net | 21 | 22 | 6 | 7 | 6 | 2 | |
Operating profit | 107 | 241 | 49 | 84 | 68 | 24 | |
Finance income | 5 | 5 | 2 | 2 | 2 | 1 | |
Finance expenses | 55 | 59 | 17 | 17 | 17 | 5 | |
Finance costs, net | 50 | 54 | 15 | 15 | 15 | 4 | |
Profit before income tax | 57 | 187 | 34 | 69 | 53 | 20 | |
Income tax expenses | 19 | 50 | 10 | 18 | 14 | 5 | |
Profit for the period | 38 | 137 | 24 | 51 | 39 | 15 | |
Earnings per share | |||||||
Basic | 0.21 | 0.75 | 0.13 | 0.28 | 0.21 | 0.08 | |
Diluted | 0.21 | 0.74 | 0.13 | 0.27 | 0.21 | 0.08 | |
Weighted average number of shares outstanding (in thousands) | |||||||
Basic | 183,145 | 184,310 | 183,212 | 184,794 | 184,310 | 184,794 | |
Diluted | 183,739 | 186,893 | 183,770 | 186,973 | 186,893 | 186,973 | |
PARTNER COMMUNICATIONS COMPANY LTD. | |||||||
(An Israeli Corporation) | |||||||
INTERIM CONDENSED CONSOLIDATED STATEMENTS | |||||||
OF COMPREHENSIVE INCOME | |||||||
New Israeli shekels | Convenience translation into U.S. dollars | ||||||
9 months period ended | 3 months period ended | 9 months period ended | 3 months period ended | ||||
2021 | 2022 | 2021 | 2022 | 2022 | 2022 | ||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||
In millions | |||||||
Profit for the period | 38 | 137 | 24 | 51 | 39 | 15 | |
Other comprehensive income for the period, net of income tax | 2 | 1 | * | * | |||
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD | 38 | 139 | 24 | 52 | 39 | 15 | |
* Representing an amount of less than 1 million.
PARTNER COMMUNICATIONS COMPANY LTD. | |||||||||||||||||
(An Israeli Corporation) | |||||||||||||||||
INTERIM SEGMENT INFORMATION & ADJUSTED EBITDA RECONCILIATION | |||||||||||||||||
New Israeli Shekels | New Israeli Shekels | ||||||||||||||||
9 months period ended September 30, 2022 | 9 months period ended September 30, 2021 | ||||||||||||||||
In millions (Unaudited) | In millions (Unaudited) | ||||||||||||||||
Cellular segment | Fixed line segment | Elimination | Consolidated | Cellular segment | Fixed line segment | Elimination | Consolidated | ||||||||||
Segment revenue - Services | 1,365 | 759 | 2,124 | 1,258 | 702 | 1,960 | |||||||||||
Inter-segment revenue - Services | 9 | 85 | (94) | 10 | 90 | (100) | |||||||||||
Segment revenue - Equipment | 410 | 70 | 480 | 453 | 97 | 550 | |||||||||||
Total revenues | 1,784 | 914 | (94) | 2,604 | 1,721 | 889 | (100) | 2,510 | |||||||||
Segment cost of revenues - Services | 900 | 707 | 1,607 | 906 | 716 | 1,622 | |||||||||||
Inter-segment cost of revenues - Services | 85 | 9 | (94) | 90 | 10 | (100) | |||||||||||
Segment cost of revenues - Equipment | 344 | 42 | 386 | 374 | 58 | 432 | |||||||||||
Cost of revenues | 1,329 | 758 | (94) | 1,993 | 1,370 | 784 | (100) | 2,054 | |||||||||
Gross profit | 455 | 156 | 611 | 351 | 105 | 456 | |||||||||||
Operating expenses (1) | 239 | 153 | 392 | 223 | 147 | 370 | |||||||||||
Other income, net | 13 | 9 | 22 | 12 | 9 | 21 | |||||||||||
Operating profit (loss) | 229 | 12 | 241 | 140 | (33) | 107 | |||||||||||
Adjustments to presentation of segment Adjusted EBITDA | |||||||||||||||||
–Depreciation and amortization | 298 | 253 | 310 | 248 | |||||||||||||
–Other (2) | 11 | 6 | 4 | 3 | |||||||||||||
Segment Adjusted EBITDA (3) | 538 | 271 | 454 | 218 | |||||||||||||
Reconciliation of segment subtotal Adjusted EBITDA to profit for the period | |||||||||||||||||
Segments subtotal Adjusted EBITDA | 809 | 672 | |||||||||||||||
- Depreciation and amortization | (551) | (558) | |||||||||||||||
- Finance costs, net | (54) | (50) | |||||||||||||||
- Income tax expenses | (50) | (19) | |||||||||||||||
- Other | (17) | (7) | |||||||||||||||
Profit for the period | 137 | 38 | |||||||||||||||
(1) Operating expenses include selling and marketing expenses and general and administrative expenses. (2) Mainly amortization of employee share based compensation. (3) 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.
PARTNER COMMUNICATIONS COMPANY LTD. | |||||||||||||||||
(An Israeli Corporation) | |||||||||||||||||
INTERIM SEGMENT INFORMATION & ADJUSTED EBITDA RECONCILIATION | |||||||||||||||||
New Israeli Shekels | New Israeli Shekels | ||||||||||||||||
3 months period ended September 30, 2022 | 3 months period ended September 30, 2021 | ||||||||||||||||
In millions (Unaudited) | In millions (Unaudited) | ||||||||||||||||
Cellular | Fixed line | Elimination | Consolidated | Cellular | Fixed line | Elimination | Consolidated | ||||||||||
Segment revenue - Services | 471 | 257 | 728 | 432 | 240 | 672 | |||||||||||
Inter-segment revenue - Services | 3 | 28 | (31) | 3 | 30 | (33) | |||||||||||
Segment revenue - Equipment | 133 | 30 | 163 | 136 | 29 | 165 | |||||||||||
Total revenues | 607 | 315 | (31) | 891 | 571 | 299 | (33) | 837 | |||||||||
Segment cost of revenues - Services | 305 | 237 | 542 | 291 | 248 | 539 | |||||||||||
Inter-segment cost of revenues - Services | 28 | 3 | (31) | 30 | 3 | (33) | |||||||||||
Segment cost of revenues - Equipment | 115 | 15 | 130 | 110 | 18 | 128 | |||||||||||
Cost of revenues | 448 | 255 | (31) | 672 | 431 | 269 | (33) | 667 | |||||||||
Gross profit | 159 | 60 | 219 | 140 | 30 | 170 | |||||||||||
Operating expenses (1) | 87 | 55 | 142 | 78 | 49 | 127 | |||||||||||
Other income, net | 4 | 3 | 7 | 4 | 2 | 6 | |||||||||||
Operating profit (loss) | 76 | 8 | 84 | 66 | (17) | 49 | |||||||||||
Adjustments to presentation of segment Adjusted EBITDA | |||||||||||||||||
–Depreciation and amortization | 100 | 87 | 105 | 93 | |||||||||||||
–Other (2) | 3 | 2 | 1 | 2 | |||||||||||||
Segment Adjusted EBITDA (3) | 179 | 97 | 172 | 78 | |||||||||||||
Reconciliation of segment subtotal Adjusted EBITDA to | |||||||||||||||||
Segments subtotal Adjusted EBITDA | 276 | 250 | |||||||||||||||
- Depreciation and amortization | (187) | (198) | |||||||||||||||
- Finance costs, net | (15) | (15) | |||||||||||||||
- Income tax expenses | (18) | (10) | |||||||||||||||
- Other | (5) | (3) | |||||||||||||||
Profit for the period | 51 | 24 | |||||||||||||||
(1) Operating expenses include selling and marketing expenses and general and administrative expenses. (2) Mainly amortization of employee share based compensation. (3) 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.
PARTNER COMMUNICATIONS COMPANY LTD. | |||
(An Israeli Corporation) | |||
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||
New Israeli Shekels | Convenience | ||
9 months period ended September 30, | |||
2021 | 2022 | 2022 | |
(Unaudited) | (Unaudited) | (Unaudited) | |
In millions | |||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Cash generated from operations (Appendix) | 612 | 788 | 222 |
Income tax paid | (1) | (9) | (3) |
Net cash provided by operating activities | 611 | 779 | 219 |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Acquisition of property and equipment | (344) | (407) | (115) |
Acquisition of intangible and other assets | (116) | (142) | (40) |
Proceeds from deposits, net | 45 | 418 | 118 |
Interest received | 1 | 3 | 1 |
Net cash used in investing activities | (414) | (128) | (36) |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Lease principal payments | (102) | (100) | (28) |
Lease interest payments | (14) | (13) | (4) |
Interest paid | (43) | (44) | (12) |
Proceeds from issuance of notes payable, net of issuance costs | 23 | (1) | * |
Repayment of notes payable | (128) | (213) | (60) |
Repayment of non-current borrowings | (39) | (39) | (11) |
Net cash used in financing activities | (303) | (410) | (115) |
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | (106) | 241 | 68 |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 376 | 308 | 87 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 270 | 549 | 155 |
* 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 statements | ||||
New Israeli Shekels | Convenience | |||
9 months period ended September 30, | ||||
2021 | 2022 | 2022 | ||
(Unaudited) | (Unaudited) | (Unaudited) | ||
In millions | ||||
Cash generated from operations: | ||||
Profit for the period | 38 | 137 | 39 | |
Adjustments for: | ||||
Depreciation and amortization | 535 | 528 | 149 | |
Amortization of deferred expenses - Right of use | 23 | 23 | 6 | |
Employee share based compensation expenses | 8 | 16 | 5 | |
Liability for employee rights upon retirement, net | 4 | (2) | (1) | |
Finance costs (income), net | (3) | 12 | 3 | |
Lease interest payments | 14 | |||
Interest paid | 43 | 44 | 12 | |
Interest received | (1) | (3) | (1) | |
Deferred income taxes | 12 | 10 | 3 | |
Income tax paid | 1 | 9 | 3 | |
Changes in operating assets and liabilities: | ||||
Decrease (increase) in accounts receivable: | ||||
Trade | (18) | 2 | 1 | |
Other | 7 | 62 | 17 | |
Increase (decrease) in accounts payable and accruals: | ||||
Trade | (18) | (25) | (7) | |
Other payables and provisions | 26 | 19 | 5 | |
Deferred revenues and other | (9) | (13) | (3) | |
Increase in deferred expenses - Right of use | (42) | (49) | (14) | |
Current income tax | 6 | 30 | 8 | |
Increase in inventories | (14) | (12) | (3) | |
Cash generated from operations | 612 | 788 | 222 | |
At September 30, 2022 and 2021, trade and other payables include NIS 134 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 into | |||||
9 months period ended September 30, | 3 months period ended September 30, | 9 months period ended September 30, | 3 months period ended September 30, | ||||
2021 | 2022 | 2021 | 2022 | 2022 | 2022 | ||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||
In millions | |||||||
Net cash provided by operating activities | 611 | 779 | 224 | 279 | 219 | 79 | |
Net cash used in investing activities | (414) | (128) | (177) | (64) | (36) | (18) | |
Proceeds from (investment in) short-term deposits, net |
(45) |
(418) |
5 |
(140) |
(118) |
(40) | |
Lease principal payments | (102) | (100) | (38) | (33) | (28) | (9) | |
Lease interest payments | (14) | (13) | (5) | (4) | (4) | (1) | |
Adjusted Free Cash Flow | 36 | 120 | 9 | 38 | 33 | 11 | |
Interest paid | (43) | (44) | (1) | * | (12) | * | |
Adjusted Free Cash Flow After Interest | (7) | 76 | 8 | 38 | 21 | 11 | |
* Representing an amount of less than 1 million.
Total Operating Expenses (OPEX) |
New Israeli Shekels | Convenience translation into | |||||
9 months period ended September 30, | 3 months period ended September 30, | 9 months period ended September 30, | 3 months period ended September 30, | ||||
2021 | 2022 | 2021 | 2022 | 2022 | 2022 | ||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||
In millions | |||||||
Cost of revenues - Services | 1,622 | 1,607 | 539 | 542 | 454 | 154 | |
Selling and marketing expenses | 238 | 268 | 81 | 93 | 75 | 26 | |
General and administrative expenses | 132 | 124 | 46 | 49 | 35 | 14 | |
Depreciation and amortization | (558) | (551) | (198) | (187) | (155) | (53) | |
Other (1) | (1) | (7) | (1) | (2) | (2) | (1) | |
OPEX | 1,433 | 1,441 | 467 | 495 | 407 | 140 | |
(1) Mainly amortization of employee share-based compensation and other adjustments.
Key Financial and Operating Indicators (unaudited) * | ||||||||||||||
NIS M unless otherwise stated | Q1' 20 | Q2' 20 | Q3' 20 | Q4' 20 | Q1' 21 | Q2' 21 | Q3' 21 | Q4' 21 | Q1' 22 | Q2' 22 | Q3' 22 | 2020 | 2021 | |
Cellular Segment Service Revenues | 423 | 409 | 415 | 416 | 413 | 420 | 435 | 431 | 443 | 457 | 474 | 1,663 | 1,699 | |
Cellular Segment Equipment Revenues | 146 | 130 | 134 | 135 | 160 | 157 | 136 | 149 | 142 | 135 | 133 | 545 | 602 | |
Fixed-Line Segment Service Revenues | 245 | 244 | 252 | 252 | 260 | 262 | 270 | 274 | 280 | 279 | 285 | 993 | 1,066 | |
Fixed-Line Segment Equipment Revenues | 32 | 28 | 35 | 41 | 34 | 34 | 29 | 29 | 22 | 18 | 30 | 136 | 126 | |
Reconciliation for consolidation | (39) | (37) | (36) | (36) | (34) | (33) | (33) | (30) | (33) | (30) | (31) | (148) | (130) | |
Total Revenues | 807 | 774 | 800 | 808 | 833 | 840 | 837 | 853 | 854 | 859 | 891 | 3,189 | 3,363 | |
Gross Profit from Equipment Sales | 37 | 30 | 38 | 40 | 42 | 39 | 37 | 34 | 33 | 28 | 33 | 145 | 152 | |
Operating Profit | 36 | 20 | 20 | 20 | 28 | 30 | 49 | 56 | 72 | 85 | 84 | 96 | 163 | |
Cellular Segment Adjusted EBITDA | 132 | 129 | 134 | 138 | 143 | 139 | 172 | 162 | 172 | 187 | 179 | 533 | 616 | |
Fixed-Line Segment Adjusted EBITDA | 83 | 71 | 70 | 65 | 66 | 74 | 78 | 88 | 85 | 89 | 97 | 289 | 306 | |
Total Adjusted EBITDA | 215 | 200 | 204 | 203 | 209 | 213 | 250 | 250 | 257 | 276 | 276 | 822 | 922 | |
Adjusted EBITDA Margin (%) | 27 % | 26 % | 26 % | 25 % | 25 % | 25 % | 30 % | 29 % | 30 % | 32 % | 31 % | 26 % | 27 % | |
OPEX | 460 | 456 | 475 | 480 | 481 | 485 | 467 | 469 | 476 | 469 | 495 | 1,871 | 1,901 | |
Finance costs, net | 19 | 13 | 24 | 13 | 19 | 16 | 15 | 14 | 18 | 21 | 15 | 69 | 64 | |
Profit (Loss) | 10 | 7 | (5) | 5 | 5 | 9 | 24 | 77 | 39 | 47 | 51 | 17 | 115 | |
Capital Expenditures (cash) | 151 | 119 | 147 | 156 | 149 | 139 | 172 | 212 | 170 | 174 | 205 | 573 | 672 | |
Capital Expenditures (additions) | 129 | 121 | 179 | 166 | 142 | 182 | 112 | 244 | 166 | 174 | 161 | 595 | 680 | |
Adjusted Free Cash Flow | 10 | 44 | 21 | (3) | 19 | 8 | 9 | (79) | 25 | 57 | 38 | 72 | (43) | |
Adjusted Free Cash Flow (after interest) | 8 | 13 | 12 | (10) | 18 | (33) | 8 | (84) | 24 | 14 | 38 | 23 | (91) | |
Net Debt | 673 | 658 | 646 | 657 | 639 | 670 | 662 | 744 | 720 | 706 | 667 | 657 | 744 | |
Cellular Subscriber Base (Thousands) | 2,676 | 2,708 | 2,762 | 2,836 | 2,903 | 2,970 | 3,019 | 3,023 | 3,063 | 3,095 | 3,042 | 2,836 | 3,023 | |
Post-Paid Subscriber Base (Thousands) | 2,380 | 2,404 | 2,437 | 2,495 | 2,548 | 2,615 | 2,664 | 2,671 | 2,708 | 2,733 | 2,679 | 2,495 | 2,671 | |
Pre-Paid Subscriber Base (Thousands) | 296 | 304 | 325 | 341 | 355 | 355 | 355 | 352 | 355 | 362 | 363 | 341 | 352 | |
Cellular ARPU (NIS) | 53 | 51 | 51 | 49 | 48 | 48 | 48 | 48 | 48 | 49 | 51 | 51 | 48 | |
Cellular Churn Rate (%) | 7.5 % | 7.5 % | 7.3 % | 7.2 % | 6.8 % | 7.2 % | 6.4 % | 7.9 % | 7.0 % | 6.7 % | 8.9 % | 30 % | 28 % | |
Infrastructure-Based Internet Subscribers (Thousands) | 281 | 295 | 311 | 329 | 339 | 354 | 365 | 374 | 387 | 395 | 403 | 329 | 374 | |
Fiber-Optic Subscribers (Thousands) | 87 | 101 | 120 | 139 | 155 | 173 | 192 | 212 | 233 | 250 | 268 | 139 | 212 | |
Homes connected to fiber-optic infrastructure (Thousands) | 361 | 396 | 432 | 465 | 514 | 571 | 624 | 700 | 770 | 837 | 900 | 465 | 700 | |
TV Subscriber Base (Thousands) | 200 | 215 | 224 | 232 | 234 | 223** | 226 | 226 | 225 | 224 | 222 | 232 | 226** | |
Number of Employees (FTE) | 1,867 | 2,745 | 2,731 | 2,655 | 2,708 | 2,628 | 2,627 | 2,574 | 2,536 | 2,588 | 2,660 | 2,655 | 2,574 | |
* 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 at various different times and had remained in trial periods of over six months without charge or usage.
Disclosure for notes holders as of September 30, 2022 | ||||||||||||
Information regarding the notes series issued by the Company, in million NIS | ||||||||||||
Series | Original issuance date | Principal on the date of issuance | As of 30.09.2022 | Annual interest rate | Principal | Interest | Interest linkage | Trustee contact details | ||||
Principal book value | Linked principal book value | Interest accumulated in books | Market value | From | To | Principal book value | ||||||
F (2) | 20.07.17 12.12.17* 04.12.18* 01.12.19* | 255 389 150 226.75 | 256 | 256 | 1 | 252 | 2.16 % | 25.06.20 | 25.06.24 | 25.06, 25.12 | Not Linked | Hermetic Trust (1975) Ltd. Merav Offer. 113 Hayarkon St., Tel Aviv. Tel: 03-5544553. |
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 | 766 | 766 | 8 | 760 | 4 % | 25.06.22 | 25.06.27 | 25.06 | Not Linked | Hermetic Trust (1975) Ltd. Merav Offer. 113 Hayarkon St., Tel Aviv. Tel: 03-5544553. |
H (2) | 26.12.21
| 198.4
| 198 | 198 | 1 | 172 | 2.08 % | 25.06.25 | 25.06.30 | 25.06 | Not Linked | Hermetic Trust (1975) Ltd. Merav Offer. 113 Hayarkon St., Tel Aviv. Tel: 03-5544553. |
(1) In April 2019, the Company issued in a private placement 2 series of untradeable option warrants that were 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 were allotted upon the exercise of an option warrant were identical in all their rights to the Company's Series G debentures immediately upon their allotment, and are entitled to any payment of interest or other benefit, the effective date of which is due after the allotment date. The debentures that were allotted as a result of the exercise of option warrants were 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, the Company issued Series G Notes in a total principal amount of NIS 101 million. The issuance in May 2021 was the final exercise of option warrants from the second series.
(2) Regarding Series F Notes, Series G Notes, Series H Notes and borrowing P, borrowing Q and borrowing R 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 September 30, 2022, the ratio of Net Debt to Adjusted EBITDA was 0.6. Additional stipulations mainly include: Shareholders' equity shall not decrease below NIS 400 million and no dividends will be declared if shareholders' equity will be below NIS 650 million regarding Series F notes, borrowing P and borrowing Q. Shareholders' equity shall not decrease below NIS 600 million and no dividends will be declared if shareholders' equity will be below NIS 750 million regarding Series G notes and borrowing R. Shareholders' equity shall not decrease below NIS 700 million and no dividends will be declared if shareholders' equity will be below NIS 850 million regarding Series H notes. The Company shall not create floating liens subject to certain terms. The Company has the right for early redemption under certain conditions. With respect to notes payable series F, series G and series H: 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.
* On these dates additional Notes of the series were issued. The information in the table refers to the full series.
Disclosure for Notes holders as of September 30, 2022 (cont.) | ||||||
Notes Rating Details* | ||||||
Series | Rating | Rating as of | Rating assigned upon | Recent date of rating as of | Additional ratings between the original issuance date and the recent date of rating (2) | |
Date | Rating | |||||
F | S&P Maalot | ilA+ | ilA+ | 08/2022 | 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, 12/2021, 08/2022 | ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+ |
G | S&P Maalot | ilA+ | ilA+ | 08/2022 | 12/2018, 01/2019, 04/2019, 08/2019, 02/2020, 05/2020, 06/2020, 07/2020, 08/2020, 11/2020, 05/2021, 08/2021, 12/2021, 08/2022 | ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+, ilA+ |
H | S&P Maalot | ilA+ | ilA+ | 08/2022 | 12/2021, 08/2022 | ilA+, ilA+ |
(1) In August 2022, 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 7, 2022.
* 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 September 30, 2022
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 | - | 212,985 | - | - | - | 40,282 |
Second year | - | 212,985 | - | - | - | 34,191 |
Third year | - | 124,765 | - | - | - | 27,950 |
Fourth year | - | 190,008 | - | - | - | 23,722 |
Fifth year and on | - | 479,219 | - | - | - | 22,692 |
Total | - | 1,219,962 | - | - | - | 148,837 |
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 | - | 30,073 | - | - | - | 4,650 |
Second year | - | 17,080 | - | - | - | 4,044 |
Third year | - | 30,000 | - | - | - | 3,820 |
Fourth year | - | 15,000 | - | - | - | 3,060 |
Fifth year and on | - | 105,000 | - | - | - | 8,416 |
Total | - | 197,153 | - | - | - | 23,990 |
Summary of Financial Undertakings (according to repayment dates) as of September 30, 2022 (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 | - | 243,058 | - | - | - | 44,932 |
Second year | - | 230,065 | - | - | - | 38,235 |
Third year | - | 154,765 | - | - | - | 31,770 |
Fourth year | - | 205,008 | - | - | - | 26,782 |
Fifth year and on | - | 584,219 | - | - | - | 31,108 |
Total | - | 1,417,115 | - | - | - | 172,827 |
f. Off-balance sheet credit exposure based on the Company's "Solo" financial data– As of September 30, 2022, the Company provided financial guarantees in a total amount of NIS 85 million.
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-third-quarter-2022-results1-301685936.html
SOURCE Partner Communications Company Ltd.
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