§
|
Total Revenues from services
increased 8% to NIS 5,387 million ($1,401
million)
|
§
|
Revenues from content and value
added services (including SMS) increased 46%, reaching 9.1% of
services revenues
|
§
|
Total Revenues (including
revenues of end-user equipment) increased 7.6% to NIS 6,050 million
($1,573 million)
|
§
|
EBITDA increased
13.5% to NIS 2,115 million ($550 million); EBITDA margin
35.0%, up from
33.2%
|
§
|
Operating income
increased 29.7% to NIS 1,341 million ($349
million)
|
§
|
Net income increased
56.2% to NIS 873 million ($227 million)2
|
§
|
Free Cash Flow 1 increased 27.1% to
NIS 1,073 million ($279 million)
|
§
|
Subscriber base
increased by approx. 189,000, reaching approx. 3.073 million at the
end of 2007
|
§
|
3G subscribers reached
approx. 419,000 at the end of 2007
|
§
|
The Company Declared
fourth quarter and one-time extraordinary dividend of NIS 7.18 per share, bringing the
aggregate dividends distributed for 2007 to NIS 1,355 million (NIS 13.90
per share)
|
§
|
Total Revenues from services
increased 8% to NIS 1,372 million ($357 million)
|
§
|
Revenues from content and value
added services (including SMS) increased 47.8%, reaching 9.9% of
services revenues
|
§
|
Total Revenues (including
revenues of end-user equipment) increased 10.7% to NIS 1,584
million ($412 million)
|
§
|
EBITDA increased
10.8% to NIS 482 million ($125 million); EBITDA margin
30.4%, similar to
the fourth quarter last year
|
§
|
Operating income
increased 22.0% to NIS 283 million ($74 million)
|
§
|
Net income increased
31.7% to NIS 183 million ($48 million)
|
§
|
Subscriber base
increased by approx. 57,000 subscribers during the fourth
quarter
|
1
|
Please view
section "Use of Non-GAAP financial measures" at the end of this press
release.
|
2
|
Includes a one
time gain following the release of a tax provision; See "Finance Expenses,
Net" below.
|
Million
NIS
|
%
of Revenues
|
%
Change
|
Million
US$
(convenience
translation)
|
||||
2007
|
2006
|
2007
|
2006
|
2007
|
2006
|
||
Revenues -
Services
|
5,387
|
4,986
|
89.0%
|
88.7%
|
8.0%
|
1,401
|
1,297
|
Revenues -
Equipment
|
663
|
636
|
11.0%
|
11.3%
|
4.2%
|
172
|
165
|
Total
revenues
|
6,050
|
5,622
|
100.0%
|
100.0%
|
7.6%
|
1,573
|
1,462
|
Cost of
revenues - Services
|
2,572
|
2,493
|
42.5%
|
44.3%
|
3.2%
|
669
|
648
|
Cost of
revenues - Equipment
|
800
|
780
|
13.2%
|
13.9%
|
2.6%
|
208
|
203
|
Total
cost of revenues
|
3,372
|
* 3,273
|
55.7%
|
58.2%
|
3.0%
|
877
|
851
|
Gross
Profit
|
2,678
|
2,349
|
44.3%
|
41.8%
|
14.0%
|
696
|
611
|
Marketing and
Sales Expenses
|
685
|
656
|
11.3%
|
11.7%
|
4.4%
|
178
|
171
|
General and
Administration Expenses
|
652
|
659
|
10.8%
|
11.7%
|
4.4%
|
178
|
171
|
Operating
income
|
1,341
|
1,034
|
22.2%
|
18.4%
|
29.7%
|
349
|
269
|
Finance
Expenses, net
|
(156)
|
(155)
|
(2.6%)
|
(2.8%)
|
0.6%
|
(41)
|
(40)
|
Other
Expenses, net
|
(3)
|
* (6)
|
(0.1%)
|
(0.1%)
|
(50.0%)
|
(1)
|
(2)
|
Income
before Taxes on Income
|
1,182
|
873
|
19.5%
|
15.5%
|
35.4%
|
307
|
227
|
Taxes on
Income
|
309
|
* 314
|
5.1%
|
5.6%
|
(1.6%)
|
80
|
82
|
Net
Income
|
873
|
559
|
14.4%
|
9.9%
|
56.2%
|
227
|
145
|
Cash
Flow from Operating Activities, net of Investing
Activities
|
1,073
|
844
|
17.7%
|
15.0%
|
27.1%
|
279
|
219
|
*
|
Restated due
to initial implementation of a new Israeli Accounting Standard No. 27. For
details see Note 2.U.2 to our financial statements as of December 31,
2007.
|
2007
|
2006
|
%
Change
|
2007
|
2006
|
Million
NIS
|
Million
US$
(convenience
translation)
|
EBITDA
|
2,115
|
1,864
|
13.5%
|
550
|
485
|
EBITDA, as
percent of Revenues
|
35.0%
|
33.2%
|
5.4%
|
35.0%
|
33.2%
|
Subscribers
end of period
(in
thousands)
|
3,073
|
2,884
|
6.6%
|
||
Estimated
Market Share3
|
34%
|
34%
|
-
|
||
Churn Rate (in
%)
|
16.3%
|
16.8%
|
(3.0%)
|
||
Average
Monthly MOU (in minutes)
|
348
|
*
333
|
4.5%
|
||
Monthly ARPU
(in NIS)
|
149
|
*
149
|
-
|
38.7
|
38.7
|
*
|
Restated to
reflect the full impact of the change in our subscriber calculation
methodology implemented in July 2006 to allow comparison to
2007.
|
4
|
MOU and ARPU for the
full year of 2006 were restated to reflect the full impact of the change
in the methodology of calculating our subscriber base implemented in July
2006, to allow comparison to
2007.
|
US Dial-in Number: 1 888 407 2553 | UK Dial-in Number: 0 800 051 8913 |
Israel Dial-in Number: 03 918 0609 | International Dial-in Number: +972 3 918 0609 |
Company
Contact
Shiri
Israeli
Investor
Relations Coordinator
investors@cellcom.co.il
Tel:
+972 52 998 9755
|
Investor Relations
Contact
Ehud Helft /
Ed Job
CCGK Investor
Relations
ehud@gkir.com
/
ed.job@ccgir.com
Tel: (US) 1
866 704 6710 / 1 646-213-1914
|
Convenience
Translation
into US
dollar
|
||||||||||||
December
31,
|
December
31,
|
December
31,
|
||||||||||
2006
|
2007
|
2007
|
||||||||||
NIS
millions
|
NIS
millions
|
US$
millions
|
||||||||||
(Audited)
|
(Audited)
|
(Audited)
|
||||||||||
Current
assets
|
||||||||||||
Cash
and cash equivalents
|
56 | 911 | 237 | |||||||||
Trade
receivables, net
|
1,242 | 1,385 | 360 | |||||||||
Other
receivables
|
123 | 133 | 34 | |||||||||
Inventory
|
131 | 245 | 64 | |||||||||
1,552 | 2,674 | 695 | ||||||||||
Long-term
receivables
|
526 | 545 | 142 | |||||||||
Property,
plant and equipment, net
|
(**)(*) 2,550 | 2,368 | 616 | |||||||||
Intangible
assets, net
|
(**)695 | 685 | 178 | |||||||||
Total
assets
|
5,323 | 6,272 | 1,631 |
|
||||||||||||
Current
liabilities
|
||||||||||||
Short-term
bank credit
|
- | 353 | 92 | |||||||||
Trade
payables and accrued expenses
|
819 | 1,007 | 262 | |||||||||
Other
current liabilities
|
496 | 543 | 141 | |||||||||
1,315 | 1,903 | 495 | ||||||||||
Long-term
liabilities
|
||||||||||||
Long-term
loans from banks
|
1,208 | 343 | 89 | |||||||||
Debentures
|
1,989 | 2,983 | 776 | |||||||||
Deferred
taxes
|
(*) 212 | 196 | 51 | |||||||||
Other
long-term liabilities
|
2 | 17 | 4 | |||||||||
3,411 | 3,539 | 920 | ||||||||||
Shareholders’
equity
|
(*) 597 | 830 | 216 | |||||||||
Total
liabilities and shareholders' equity
|
5,323 | 6,272 | 1,631 |
(*)
|
Restated
due to initial implementation of a new Israeli Accounting Standard No. 27.
See Note 2.U.2 to our financial statements as of December 31,
2007.
|
(**)
|
Reclassified
due to initial implementation of a new Israeli Accounting Standard No. 30.
See Note 2.U.4 to our financial statements as of December 31,
2007.
|
Convenience
Translation
into US
dollar
|
||||||||||||||||
Year
ended December 31,
|
Year
ended December 31,
|
|||||||||||||||
2005
|
2006
|
2007
|
2007
|
|||||||||||||
NIS
millions
|
US$
millions
|
|||||||||||||||
(Audited)
|
||||||||||||||||
Revenues
|
5,114 | 5,622 | 6,050 | 1,573 | ||||||||||||
Cost
of revenues
|
* 3,081 | * 3,273 | 3,372 | 877 | ||||||||||||
Gross
profit
|
2,033 | 2,349 | 2,678 | 696 | ||||||||||||
Selling
and marketing expenses
|
623 | 656 | 685 | 178 | ||||||||||||
General
and administrative expenses
|
656 | 659 | 652 | 169 | ||||||||||||
Operating
income
|
754 | 1,034 | 1,341 | 349 | ||||||||||||
Financial
income (expenses), net
|
24 | (155 | ) | (156 | ) | (41 | ) | |||||||||
Other
income (expenses), net
|
* (13 | ) | * (6 | ) | (3 | ) | (1 | ) | ||||||||
Income
before income tax
|
765 | 873 | 1,182 | 307 | ||||||||||||
Income
tax
|
* 234 | * 314 | 309 | 80 | ||||||||||||
Net
income
|
531 | 559 | 873 | 227 | ||||||||||||
Earnings
per share
|
||||||||||||||||
Basic
earnings per share (in NIS)
|
* 5.44 | * 5.73 | 8.95 | 2.33 | ||||||||||||
Diluted
earnings per share (in NIS)
|
* 5.44 | * 5.73 | 8.87 | 2.31 | ||||||||||||
Weighted
average number of shares used in the calculation of basic earnings per
share (in thousands)
|
97,500 | 97,500 | 97,500 | 97,500 | ||||||||||||
Weighted
average number of shares used in the calculation of diluted earnings per
share (in thousands)
|
97,500 | 97,500 | 98,441 | 98,441 |
(*)
|
Restated
due to initial implementation of a new Israeli Accounting Standard No. 27.
See Note 2.U.2 to our financial statements as of December 31,
2007.
|
Convenience
|
||||||||||||||||
translation
|
||||||||||||||||
into
|
||||||||||||||||
U.S.
dollar
|
||||||||||||||||
Year
ended
|
||||||||||||||||
Year
ended December 31
|
December
31
|
|||||||||||||||
2005
|
2006
|
2007
|
2007
|
|||||||||||||
NIS
millions
|
US$ millions
|
|||||||||||||||
Cash
flows from operating activities:
|
||||||||||||||||
Net
income
|
* 531 | * 559 | 873 | 227 | ||||||||||||
Addition
required to present cash flows from
|
||||||||||||||||
operating
activities (A)
|
* 741 | * 918 | 771 | 200 | ||||||||||||
Net
cash provided by operating activities
|
1,272 | 1,477 | 1,644 | 427 | ||||||||||||
Cash
flows from investing activities:
|
||||||||||||||||
Addition
to property, plant and equipment
|
** (473 | ) | ** (526 | ) | (466 | ) | (121 | ) | ||||||||
Proceeds
from sales of property, plant and equipment
|
12 | 15 | 4 | 1 | ||||||||||||
Investment
in intangible assets
|
** (158 | ) | ** (122 | ) | (97 | ) | (25 | ) | ||||||||
Investment
in long term deposit
|
- | - | (12 | ) | (3 | ) | ||||||||||
Net
cash used in investing activities
|
(619 | ) | (633 | ) | (571 | ) | (148 | ) | ||||||||
Cash
flows from financing activities:
|
||||||||||||||||
Repayments
under short-term bank credit facility
|
(4,953 | ) | (1,222 | ) | - | - | ||||||||||
Borrowings
under short-term bank credit facility
|
4,894 | 1,222 | - | - | ||||||||||||
Borrowings
of long-term loans from banks
|
- | 2,155 | - | - | ||||||||||||
Payment
of long-term loans from banks
|
(533 | ) | (1,175 | ) | (645 | ) | (168 | ) | ||||||||
Proceeds
from issuance of debentures, net of issuance costs
|
1,706 | 290 | 1,066 | 277 | ||||||||||||
Paid
dividend
|
- | (3,830 | ) | (639 | ) | (166 | ) | |||||||||
Net
cash provided by (used in) financing activities
|
1,114 | (2,560 | ) | (218 | ) | (57 | ) | |||||||||
Increase
(decrease) in cash and cash equivalents
|
1,767 | (1,716 | ) | 855 | 222 | |||||||||||
Balance
of cash and cash equivalents at beginning of the period
|
5 | 1,772 | 56 | 15 | ||||||||||||
Balance
of cash and cash equivalents at end of the period
|
1,772 | 56 | 911 | 237 |
(*)
|
Restated
due to initial implementation of a new Israeli Accounting Standard No. 27.
See Note 2.U.2 to our financial statements as of December 31,
2007.
|
(**)
|
Reclassified
due to initial implementation of a new Israeli Accounting Standard No. 30.
See Note 2.U.4 to our financial statements as of December 31,
2007.
|
Convenience
|
||||||||||||||||
translation
|
||||||||||||||||
into
|
||||||||||||||||
U.S.
dollar
|
||||||||||||||||
Year
ended
|
||||||||||||||||
Year
ended December 31
|
December
31
|
|||||||||||||||
2005
|
2006
|
2007
|
2007
|
|||||||||||||
NIS
millions
|
US$ millions
|
|||||||||||||||
Adjustments
required to present cash flows from
|
||||||||||||||||
operating
activities
|
||||||||||||||||
Income
and expenses not involving cash flows
|
||||||||||||||||
Depreciation
and amortization
|
* 889 | * 830 | 774 | 201 | ||||||||||||
Deferred
taxes
|
* (4 | ) | * (20 | ) | (4 | ) | (1 | ) | ||||||||
Exchange
and linkage differences on long-term liabilities
|
- | (109 | ) | (7 | ) | (2 | ) | |||||||||
Capital
losses
|
* 4 | * 6 | 4 | 1 | ||||||||||||
Change
in provision for decline in value of land - held for sale
|
4 | - | (10 | ) | (2 | ) | ||||||||||
Stock
based compensation
|
- | - | 29 | 7 | ||||||||||||
Change
in other long term liabilities
|
- | - | 2 | - | ||||||||||||
893 | 707 | 788 | 204 | |||||||||||||
Changes
in assets and liabilities
|
||||||||||||||||
Increase
in trade receivables (including long-term amounts)
|
(37 | ) | (75 | ) | (139 | ) | (36 | ) | ||||||||
Decrease
(increase) in other receivables
|
||||||||||||||||
(including
long- term amounts)
|
(60 | ) | 22 | (18 | ) | (5 | ) | |||||||||
Decrease
(increase) in inventories
|
(19 | ) | (13 | ) | (114 | ) | (29 | ) | ||||||||
Increase
(decrease) in trade payables (including long-term amounts)
|
(15 | ) | 4 | 178 | 46 | |||||||||||
Increase
(decrease) in other payables and credits
|
||||||||||||||||
(including
long-term amounts)
|
(21 | ) | 273 | 76 | 20 | |||||||||||
(152 | ) | 211 | (17 | ) | (4 | ) | ||||||||||
741 | 918 | 771 | 200 |
Acquisition
of property, plant and equipment and intangible assets on
credit
|
314 | 197 | 216 | 56 | ||||||||||||
Receivables
in respect of issuance of debentures
|
46 | - | - | - | ||||||||||||
Tax
withheld regarding cash dividend
|
- | - | 16 | 4 | ||||||||||||
Supplemental
information:
|
||||||||||||||||
Income
taxes paid
|
275 | 267 | 313 | 81 | ||||||||||||
Interest
paid
|
51 | 124 | 175 | 46 |
(*)
|
Restated
due to initial implementation of a new Israeli Accounting Standard No. 27.
See Note 2.U.2 to our financial statements as of December 31,
2007.
|
Year
ended December
31,
|
||||||||||||||||
Convenience
translation
into
US dollar
|
||||||||||||||||
2005
NIS
millions
|
2006
NIS
millions
|
2007
NIS
millions
|
2007
US$
millions
|
|||||||||||||
Net
income
|
* 531 | * 559 | 873 | 227 | ||||||||||||
Financial
expenses (income), net
|
(24 | ) | 155 | 156 | 41 | |||||||||||
Other expenses
(income)
|
* 13 | * 6 | 3 | 1 | ||||||||||||
Income
taxes
|
* 234 | * 314 | 309 | 80 | ||||||||||||
Depreciation
and amortization
|
* 889 | * 830 | 774 | 201 | ||||||||||||
EBITDA
|
1,643 | 1,864 | 2,115 | 550 |
(*)
|
Restated due
to initial implementation of a new Israeli Accounting Standard No. 27. See
Note 2.U.2 to our financial statements as of December 31,
2007.
|
|
The following
table shows the calculation of free cash
flow:
|
Year
ended December
31,
|
||||||||||||||||
Convenience
translation
into
US dollar
|
||||||||||||||||
2005
NIS
millions
|
2006
NIS
millions
|
2007
NIS
millions
|
2007
US$
millions
|
|||||||||||||
Cash flows
from operating activities
|
1,272 | 1,477 | 1,644 | 427 | ||||||||||||
Cash flows
from investing activities
|
(619 | ) | (633 | ) | (571 | ) | (148 | ) | ||||||||
Free Cash
Flow
|
653 | 844 | 1,073 | 279 |
CELLCOM
ISRAEL LTD.
|
||||||
Date:
|
March
18, 2008
|
By:
|
/s/ Liat
Menahemi Stadler
|
|||
Name:
|
Liat
Menahemi Stadler
|
|||||
Title:
|
General
Counsel
|