Partner Communications Co. Ltd. · TASE:PTNR
Partner Communications — Q1 2014 Earnings Presentation
29 slides from Partner Communications's earnings presentation, 2014
Slide 1: Company Presentation Q1 2014 Results
Company Presentation 1 Q1 2014 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: Agenda
1. Partner Highlights NZ se 2. The Israeli Telecommunications Market _, 3. Financial and Operational Performance af 2 4. Partner’s Strategy
Slide 4: 4
4
Slide 5: At a Glance
At a Glance Strong brand and market presence Strong subscriber base A leading communications group operating under the “orange” and “012 Smile” brands Evolving into a diversified Multi-Service Communications and Media group 29% estimated cellular market share High Speed Network, LTE Ready lorange”
Slide 6: Q1 2014 Highlights
Revenues: Service Revenues: Equipment Revenues: Adjusted EBITDA*: Profit for the period: Free Cash Flow (before interest): Cellular ARPU: Cellular Churn: Post paid subscriber base: 6
Slide 7: Partner's Ownership Structure
Partner’s Ownership Structure 12.55% 1.4% 6.21% 30.87% 5.05% S.B. Israel Telecom Scailex Suny Phoenix-Excellence Group 43.92% Psagot Investment House Public 7 As of March 31, 2014
Slide 8: 2. The Israeli Telecommunications Market
2. The Israeli Telecommunications Market
Slide 9: Main Regulatory
Main Regulatory NSA with Hot Mobile License Amended - Financial sanctions on — Currently under Data services for licensees that violate review by the ATC roamers outside Israel their license and the MOC are now blocked as a conditions default Wholesale market - International calls IBC fiber optic pr
Slide 10: 3. Financial and Operational Performance
3. Financial and Operational Performance lorange”
Slide 11: Quarterly income statement in NIS millions
in NIS millions Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Revenues 1,144 1,130 1,118 1,127 1,103 Cost of Revenues 901 878 861 870 849 Gross Profit 243 252 257 257 254 SG&A 171 171 167 170 169 Other income 23 21 19 16 14 Operating Profit 95 102 109 103 99 Financial Costs, net 49 71 53 38 24 Income Taxe
Slide 12: Cellular subscribers post-paid and pre-paid
3,500 3,160 3,176 2,976 2,956 2,936 3,000 870 894 2,500 874 823 799 2,000 1,500 2,290 2,282 2,102 2,133 2,137 1,000 500 0 2010 2011 2012 2013 Q1'14 Post-paid Pre-paid 12
Slide 13: Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14
150 125 101 101 97 100 87 83 84 82 81 77 75 50 25 - Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 13
Slide 14: Cellular churn
14% 12% 11.6% 10.9% 10.7% 10.4% 10.4% 10% 9.4% 8.8% 8.9% 8.0% 8% 6% 4% 2% 0% Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 14
Slide 15: Service and equipment revenues
6,998 7,000 6,674 1,012 1,774 6,000 5,572 5,000 932 4,519 4,000 735 3,000 5,662 5,224 4,640 2,000 3,784 1,144 1,103 1,000 183 227 961 876 0 2010 2011 2012 2013 Q1'13 Q1'14 Service Revenues Equipment Revenues 15
Slide 16: Adjusted EBITDA and EBITDA margin
39% 40% 2,500 2,570 35% 31% 29% 2,178 30% 2,000 25% 25% 23% 25% % total revenues NIS millions 1,500 1,602 20% 1,000 15% 1,114 10% 500 5% 268 274 - 0% 2010 2011 2012 2013 Q1'13 Q1'14 Adjusted EBITDA EBITDA margin 16
Slide 17: Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14
900 872 853 800 793 744 720 700 696 700 675 661 600 500 Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 17
Slide 18: Net Debt / Adjusted EBITDA
5,500 3.5 5,000 4,639 3.0 4,500 2.5 4,000 3,812 2.7 2.5 Net Debt / Adjusted EBITDA 3,500 3,395 2.4 3,000 2.0 3,000 2.1 2,849 NIS millions 2,500 1.5 2,000 1.3 1,500 1.0 1,000 0.5 500 0 - 2010 2011 2012 2013 Q1'14 Net Debt Net debt / Adjusted EBITDA 18
Slide 19: 2,400 2,175 2,000 1,707 1,600 1,200 1,110 1 - 2010 2011 2012 2013 Q1'13
2,400 2,175 2,000 1,707 1,600 1,200 1,110 800 639 400 138 161 - 2010 2011 2012 2013 Q1'13 Q1'14 19
Slide 20: Capex as % of Total Revenues
6,998 7,000 6,674 16% 6,000 14% 5,572 Capex as % of Total Revenues 5,000 12% 4,519 NIS millions 11% 4,000 11% 10% 10% 3,000 9% 8% 2,000 7% 6% 6% 1,144 1,103 1,000 4% 395 471 492 475 130 113 - 2% 2010 2011 2012 2013 Q1'13 Q1'14 CAPEX Revenues CAPEX margin 20
Slide 21: 1,600 1,502 1,400 1,234 1,200 1,082 1,041 1,000 203 200 145 - 2010 2011
1,600 1,502 1,400 1,234 1,200 1,082 1,041 1,000 800 600 400 203 200 145 - 2010 2011 2012 2013 Q1'13 Q1'14 21
Slide 22: Operating profit bridge Q4 2013 to Q1 2014
282 2 274 14 39 26 11 4 Q4 2013 Cellular Service Fixed Line Intersegment Equipment Operating Other Income Q1 2014 Revenues Service Revenues Gross Profit Service Revenues Elimination Expenses 22
Slide 23: Operating profit bridge Q1 2013 to Q1 2014
9 274 268 59 44 36 41 5 Q1 2013 Cellular Service Fixed Line Intersegment Equipment Operating Other Income Q1 2014 Revenues Service Revenues Gross Profit Service Revenues Elimination Expenses 23
Slide 24: Balance sheet
Assets Liabilities and Equity Cash and cash equivalents 620 Current maturities of Notes payables and loans 333 Trade receivables and other 1,083 Trade payables 719 Inventories 96 Other current liabilities 312 Total Current Assets 1,799 Total Current Liabilities 1,364 Trade receivables and other 442
Slide 25: 4. Partner's Strategy
4. Partner’s Strategy
Slide 26: Key benefits
• • • • • • Key benefits: • • • • • • • 26
Slide 27: Excellence in enhancing the customer experience
Excellence in orange™ - Comprehensive First in Optimizing Employee enhancing the premium value proposition launching synergies nurturing customer brand in the field of Orange 4G between the Unique experience 012 – “value communications, Developing organization’s organizational Mu
Slide 28: Why Partner
28 Why Partner Advanced Network Strong Brand Customer Centric Strategy Innovation
Slide 29: The future is bright. The future is orange
The future is bright. The future is orange™ Ziv Leitman Elana Holzman 29
Partner Communications Company — Q1 2014 Earnings Presentation on 6ix