Cellcom Israel Ltd. - CEL - The Company has taken aggressive efficiency measures
11/13/2012 9:19:52 AM
Cellcom Israel Ltd. (NYSE: CEL), announced its financial results for the third quarter of 2012. Revenues for the third quarter 2012 totaled NIS 1,448 million ($370 million); EBITDA for the third quarter 2012 totaled NIS 430 million ($110 million), or 29.7% of total revenues; and net income for the third quarter 2012 totaled NIS 124 million ($32 million). Basic earnings per share for the third quarter 2012 totaled NIS 1.25 ($0.32).
Commenting on the results, Nir Sztern, Chief Executive Officer, said, "We are pleased with the implementation of the Company's strategy: the merger of Netvision, operational excellence, and our strengthening as a communications group.
The Company has taken aggressive efficiency measures, which led, so far, to an annual savings run rate of approximately NIS 480 million, while focusing on operational excellence. It is our intention to continue the efficiency measures in the fourth quarter this year, as well as in 2013.
We continue to leverage and expand the comprehensive services we provide as a communications group, addressing all customer segments, and seeing great success with our "Cellcom Total" marketing plan, which was launched in July of this year, followed by "Cellcom Total for Businesses", a beneficial, comprehensive communications package for small and medium businesses. At the same time, we witness Netvision's contribution to the Company's success, presenting a third quarter EBITDA of NIS 75 million, through leveraging Cellcom-Netvision synergies, and reducing cost redundancies between the companies".
Yaacov Heen, Chief Financial Officer, commented: "As we anticipated in the previous quarter, we continue to see the Company's revenue erosion due to the transfer of subscribers to the new marketing plans, launched during the second and third quarters of 2012, in response to the heightened competition. Furthermore, we expect this erosion to continue in the fourth quarter as well. Yet, we continue the implementation of efficiency measures in order to continue the adjustment of our expense structure to revenue levels.
The focus on cost reduction and the reduction in inventory levels and handset sales, have led to an improvement in our free cash flow for the third quarter of 2012, which totaled NIS 414 million. The Company's cash balance and future cash generation, will enable us to serve our debt during 2013, without having to raise additional debt.
About Cellcom Israel - CEL
Cellcom Israel Ltd. (CEL) , established in 1994, is the leading Israeli cellular provider; CEL provides its approximately 3.338 million subscribers (as at September 30, 2012) with a broad range of value added services including cellular and landline telephony, roaming services for tourists in Israel and for its subscribers abroad and additional services in the areas of music, video, mobile office etc., based on CEL's technologically advanced infrastructure. CEL operates an HSPA 3.5 Generation network enabling advanced high speed broadband multimedia services, in addition to GSM/GPRS/EDGE networks