Slide 1: Company and Financial Overview Q3 2024
Partner Communications Company and Financial Overview Q3 2024 November 13, 2024 1
Slide 2: Safe Harbor Statement
This presentation was prepared by Partner Communications Ltd. (the “Company”). This presentation is intended to serve the public investing in the Company and is intended solely for the purpose of illustrating information contained in the reports published by the Company. The presentation does not co
Slide 3: Company Overview
Company Overview 3 3
Slide 4: A leading Israeli communications company
A leading Israeli communications company Providing cutting-edge and top-notch communications solutions and services through initiative, accountability and integrity for the benefit of the Company's customers, employees and shareholders Cellular Internet Partner TV Business End Partner solutions equi
Slide 5: Our approach
Our approach Simplicity Access provided Excellent service Continuous anywhere and anytime optimization Simplicity in our day-to-day Upgrading and developing 5G Constant and A relentless push to improve conduct that enables, among network while remaining at the uncompromising operational excellence w
Slide 6: The focus on value is expected to continue
The focus on value is expected to continue Main highlights in 2024 ▪ Accelerated deployment of 5G alongside the launch of the 5G SA network core ▪ Focus on cellular value packages, including 5G ▪ Growth in fiber subscriptions ▪ Completion of fiber infrastructure deployment for international traffic
Slide 7: Expected developments
Expected developments ▪ On the basis that the damage to the Company's activity resulting from the war will be similar to that measured from the start of 2024 to date, the decrease in the Company's profit (before tax) from roaming services, for each month of the war, is estimated to be in the range o
Slide 8: Launch of the 5G network core - stability, continuity and quality
Launch of the 5G network core - stability, continuity and quality ▪ A deployment that enables a 5G experience in designated geographic areas ▪ Population coverage of approx. 70% at the end of 2023 ▪ Focus on reducing coverage gaps within cities ▪ Switching to the 5G SA core system is expected to max
Slide 9: The only player with access to the three fiber infrastructures in Israel
The only player with access to the three fiber infrastructures in Israel ▪ Maximum flexibility with the ability to offer fiber services on Partner's independent fiber infrastructure, Bezeq fiber infrastructure and the IBC infrastructure ▪ Continued growth in fiber subscribers while leveraging the po
Slide 10: Infrastructure deployment aimed at the international communications market
Moving forward according to plans in infrastructure deployment aimed at the international communications market ▪ Local infrastructure deployed for durable communication and information transfer services between the Far East/Gulf countries and Europe ▪ An alternative route from Haifa to Eilat and to
Slide 11: Partner TV - Anticipating a new operating model
Partner TV - Anticipating a new operating model ▪ The Company signed an agreement with YES, which enables marketing to the subscriber a content application, fully adapted to the Partner brand, based on the most extensive content package of the Sting+ service (from YES) ▪ Upon completion of the prepa
Slide 12: Growth engines in business solutions
Growth engines in business solutions ▪ Expanding our share in the customer's communication solutions mix ▪ Offering a basket of integrated cellular, fixed-line and equipment solutions under one roof ▪ Focus on continued growth in revenues from data services for businesses ▪ Growth in revenue from in
Slide 13: Milestones for realization of the potential in equipment activity
Milestones for realization of the potential in equipment activity ▪ Achieving efficiency and flexibility through the creation of a single unit for trade and end equipment activity ▪ Focus on the sale of equipment compatible with the Company's core activity ▪ Creating value for customers through repa
Slide 14: Entry into the electricity supply market for private and business customers
Entry into the electricity supply market for private and business customers ▪ The electricity market for the home consumer is expected to grow due to increasing changes in consumption habits ▪ The public’s growing awareness along with an increasing number of smart meters provide an opportunity to le
Slide 15: ESG
Partner in numbers - 2023 ESG Social activities 10 50% with value 3.5% 68% consecutive years of of Partner’s senior with “Or4Family", the IDF Employees with of all employees Platinum+ in corporate management are fighter battalions, the disabilities who have volunteer, including in responsibility ESG
Slide 16: Financial Overview
Financial Overview Q3/2024 16 16
Slide 17: Operational and financial emphases
Operational and financial emphases Q3/2024 compared to Q3/2023 Cellular subscribers ARPU cellular, not including Fiber-optic subscribers TV subscribers (thousands) interconnection fees (thousands) (thousands) (NIS) 2,635 Post-paid: -8K Pre-paid: -12K 44 - NIS 1 421 + 68K 205 -5K An increase of appro
Slide 18: Cellular - Subscribers and churn rate
Cellular - Subscribers and churn rate The change in the number of subscribers in the The decrease in the churn rate in the quarter was quarter is explained by the Company's focus on measured for postpaid and prepaid subscribers postpaid value packages Cellular subscribers Churn rate (end of period,
Slide 19: ARPU Cellular
ARPU Cellular (NIS) Not including interconnection fees, the decrease in Q3 compared to the corresponding quarter reflects the effects of the war on revenues from roaming services and the end of recognition of deferred revenues from Hot Mobile, offset by an increase in revenues from cellular packages
Slide 20: Cellular segment - Quarter results
Cellular segment - Quarter results The decrease in the adjusted EBITDA of the cellular segment was due to a decrease in revenues from roaming services, the end of recognition of deferred revenues from Hot Mobile and an increase in expenses for the fiber deployment incentive fund. The decrease was pa
Slide 21: Cellular segment - Nine months of 2024
Cellular segment - Nine months of 2024 The increase in the adjusted EBITDA of the cellular segment in the period was mainly due to an increase in revenues from cellular packages and a decrease in provisions for claims and others. The increase was partially offset by a decrease in revenues from roami
Slide 22: Internet and TV subscribers
Internet and TV subscribers Approx. 90% of Internet subscribers are on fiber Over 80% of TV subscribers are in integrated infrastructure Internet-based packages Internet subscribers TV subscribers (end of period, thousands) (end of period, thousands) 439 447 455 465 210 207 206 205 205 434 353 369 3
Slide 23: Fixed-line segment - Quarter results
Fixed-line segment - Quarter results The increase in the adjusted EBITDA was mainly due to the recognition of a profit (before tax) in the amount of approx. NIS 24 million for the leasing of certain fiber optics (in the IRU model) to a business customer, an increase in commissioned work activity and
Slide 24: Fixed-line segment - Nine months of 2024
Fixed-line segment - Nine months of 2024 The increase in adjusted EBITDA was mainly due to growth in revenues from Internet and data services for businesses, from the recognition of revenues from fiber leases in the IRU model in Q3, an increase in profit from commissioned work activity and a decreas
Slide 25: Total Company - Sales of equipment and others
Total Company - Sales of equipment and others (NIS millions) The increase in the period and in the quarter was mainly due to an increase in sales of cellular equipment, as well as a result of large sales transactions to business customers Quarterly data Period data 19% 14% 13% 20% 427 15% 10% 11% 11
Slide 26: Total Company - Adjusted EBITDA
Total Company - Adjusted EBITDA (NIS millions) The adjusted EBITDA in Q3/2024 amounted to approx. NIS 319 million, an increase of approx. 13% compared to the corresponding quarter Quarterly data Period data 34% 30% 883 800 9M'23 9M'24 * Adjusted EBITDA as a percentage of total revenues, not includin
Slide 27: Total Company - Net profit
Total Company - Net profit (NIS millions) The net profit in Q3/2024 amounted to approx. NIS 85 million, an increase of approx. 52% from approx. NIS 56 million in the corresponding quarter Quarterly data Period data 197 85 56 55 57 138 25 Q3'23 Q4'23 Q1'24 Q2'24 Q3'24 9M'23 9M'24 27 27
Slide 28: Total Company - Cash flow investments
Total Company - Cash flow investments (NIS millions) The Company expects that the cash flow investment in 2024 will decrease to approx. NIS 550 million compared to approx. NIS 656 million in 2023 Quarterly data Period data 172 159 159 138 497 405 95 Q3'23 Q4'23 Q1'24 Q2'24 q3'24 Q3/2024 9M'23 9M'24
Slide 29: Total Company - Adjusted free cash flow
Total Company - Adjusted free cash flow (NIS millions) The increase in the adjusted free cash flow in the period was mainly due to a decrease in CAPEX payments and an income tax refund due to the tax position the Company took in the 2022 tax report, which were partially offset by an increase in IRU
Slide 30: Net financial debt and settlement schedule
Net financial debt and settlement schedule In May 2024, Maalot S&P upgraded the rating from +ilA+ to ilAA-, with a stable rating outlook, due to improved financial ratios Settlement schedule for bonds and loans Net financial debt (NIS millions) / Net financial debt to (NIS millions) Adjusted EBITDA
Slide 31: Summary
Summary ▪ Continued improvements in sales effectiveness ▪ Accelerated 5G deployment, while continuing to focus on value propositions in cellular ▪ Growth in fiber subscriptions and Internet revenues ▪ Increase in the adjusted free cash flow in the period hello future ▪ Financial strength with net fi
Slide 32: Let's stay in touch
Let’s stay in touch Investor Relations investors@partner.co.il Investor website: www.partner.co.il/en/Investors-Relations/lobby 32 32
Slide 33: Thank You
Thank You 33 33