Partner Communications Co. Ltd. · TASE:PTNR
Partner Communications — Q2 2015 Earnings Presentation
26 slides from Partner Communications's earnings presentation, 2015
Slide 1: Partner Communication Company and Financial Overview Q2 2015 Results
Partner Communication Company Presentation Company and Financial Overview Q2 2015 Results
Slide 2: Safe harbor statement
Safe harbor statement This presentation 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
Slide 3: Company overview
Company overview orange”
Slide 4: Strategic pillars: Orange dual branding, innovation, operational excellence
Total Innovation & tech Operational Customer Dual Branding communications Excellence Human Capital Centric leadership company Excellence in Orange TM Comprehensive First to launch Optimizing Employee enhancing the Premium brand value added Orange 4G synergies nurturing customer 012 – “
Slide 5: A comprehensive product offering
A comprehensive product offering i + a Cellular services Content Services Comm Devices Repair Services & Accessories > @ gS g a Cloud services ISP Broadband International Calls Infrastructure XY - ft £3 Home Telephony Intemet Security Hosting Transmission Products and services are offered under the
Slide 6: Shareholder structure: S.B. Israel Telecom, Scailex, public float
S.B. Israel Telecom 30.5% Public float Scailex 63.5% 6.0% 6
Slide 7: Future savings from network sharing agreement with HOT Mobile
Future savings from network sharing agreement with HOT Mobile Network sharing agreement business model = HOT Mobile to pay one-time amount by 2017 = CAPEX — shared equally = OPEX —50% shared equally and 50% split based on traffic = Key benefits = Savings in CAPEX and OPEX = Smaller number of network
Slide 8: Future relationship as part of brand agreement with Orange Worldwide
Future relationship as part of brand agreement with Orange Worldwide = Market Study = Examine Partner’s positioning within the Israeli telecom market = Assess the best path going forward = Termination of the Brand License Agreement = Year 1: Only Partner has the right to end the agreement = Year 2:
Slide 9: Market overview
Viarket overview
Slide 10: Partner ARPU decline 2011 to 2015
2011 2015 Partner Q1’11 ARPU: NIS 115 Partner Q2’15 ARPU: NIS 70 10
Slide 11: Cellular market developments
Cellular Investments Cellular Network sharing Roaming International calls Premium calls 11
Slide 12: Broadband reform and fixed market
Broadband reform Fixed Wholesale Telephony market Multicast Passive infrastructure TV / Schejter Committee Bezeq structural separation 12
Slide 13: Financial overview
Financial overview
Slide 14: Q2 2015 key financial results
Q2’ 15 Q2’ 14 YoY change Total revenue (NIS, M) 1,044 1,087 -4% Service revenue (NIS, M) 757 862 -12% Equipment revenue (NIS, M) 287 225 +28% EBITDA (NIS, M) 236 291 -19% EBITDA margin 23% 27% -4 ppt Profit (NIS, M) 9 46 -80% Free cash flow (NIS, M) 24 192 -88% Cellular ARPU (NIS) 70 76 -8% Quarterl
Slide 15: Cellular subscribers, ARPU and churn rate
Cellular subscribers (EOP, in thousands) Cellular ARPU (in NIS) 160 3,500 3,176 140 2,976 2,956 3,000 2,837 2,774 2,747 120 894 111 2,500 874 823 705 662 635 100 97 83 2,000 80 75 76 76 71 69 70 1,500 60 2,282 2,102 2,133 2,132 2,112 2,112 1,000 40 500 20 0 0 Q1'15 Q2'15 Q2'14 Q3'14 Q4'14 Q1'15 Q2'1
Slide 16: Subscriber movement: port in, port out and churn
2,774 158 152 116 149 2,747 662 635 2,112 2,112 March 31, 2015 June 30, 2015 Port In Non Port-In Sales Port Out Non Port-Out Churn Post-Paid subscribers Pre-Paid subscribers 16
Slide 17: Service and equipment revenues
7,000 6,000 5,572 5,000 932 4,519 4,400 NIS million 4,000 735 992 3,000 4,640 2,000 3,784 3,408 1,102 1,108 1,054 1,044 1,000 240 300 295 287 862 808 759 757 0 Q3'14 Q4'14 Q1'15 Q2'15 Service Revenues Equipment Revenues 17
Slide 18: Quarterly trend (NIS million)
900 889 800 NIS million 744 700 675 661 657 642 630 604 601 600 500 Q4'11 Q4'12 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 18
Slide 19: Adjusted EBITDA and margin
39% 40% 2,500 35% 31% 29% 2,178 30% 2,000 27% 25% 23% 25% % total revenues NIS million 1,500 1,602 20% 1,000 15% 1,114 1,096 10% 500 5% 291 236 - 0% Q2'14 Q2'15 Adjusted EBITDA Adjusted EBITDA margin 19
Slide 20: Net debt development
5,171 532 4,639 1,061 3,567 1,300 82 941 NIS million 409 675 2,626 December 31, Scheduled Prepayments** New Loans Linkage Cash June 30, 2015 2011 Repayments differences & other * Net debt Cash 20
Slide 21: Debt series: amount, coupon, yield and maturity
Annual Yield to Amount Duration Maturity Series (NIS M) Coupon (a/o 30/06) Linkage (a/o 30/06) TOTAL 3,567 21
Slide 22: Total debt composition and repayment schedule
Variable Total debt in B.S: 3,567 interest - Variable Prime, 152 , interest, 546 , 4% Cash (941) 15% CPI linked, 1,493 , 42% Net Debt 2,626 Fixed interest, 1,386 , 39% Receipt of deferred loans of NIS 200 M Receipt of deferred loan of NIS 250 M 800 720 709 Loans Notes 700 668 600 109 556 342 Receipt
Slide 23: Income bridge Q2 2014 to Q2 2015
291 86 236 0 41 NIS million 22 9 3 Q2’14 Cellular Service Fixed Line Intersegment Equipment Operating Other Income Q2’15 Revenues Service Revenues Gross Profit Service Revenues Elimination Expenses 23
Slide 24: Income bridge Q1 2015 to Q2 2015
236 3 0 227 2 8 6 2 NIS million Q1’15 Cellular Service Fixed Line Intersegment Equipment Gross Operating Other Income Q2’15 Revenues Service Revenues Revenues Profit Service Expenses Elimination 24
Slide 25: Balance sheet and cash flow before interest
Assets NIS million Liabilities and Equity NIS million Cash and cash equivalents 941 Current maturities of borrowings & notes payable 319 Trade receivables and other 1,099 Trade payables 724 Inventories 109 Other current liabilities 237 Total Current Assets 2,149 Total Current Liabilities 1,280 Trade
Slide 26: Investor relations contacts
Ziv Leitman CFO +972 (54) 781 4951 Liat Glazer Shaft Head of Investor Relations +972 (54) 781 5051 investors@orange.co.il Investor website: www.orange.co.il/en/Investors-Relations/lobby/ 26
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