●
|
Total Revenues increased 0.4% to NIS 1,587 million ($456 million)
|
●
|
Total Revenues from services decreased 14.8% to NIS 1,205 million ($346 million) as a result of the regulatory changes
|
●
|
Revenues from content and value added services (including SMS) increased 13.5%, reaching 23.7% of services revenues
|
●
|
EBITDA increased 0.2% to NIS 639 million ($184 million); EBITDA margin 40.3%
|
●
|
Operating income increased 3.1% to NIS 471 million ($135 million)
|
●
|
Net income totaled NIS 306 million ($88 million), a 2.5% decrease, attributed to the increase in financing expenses, net, resulted from the increased inflation
|
●
|
Free cash flow1 increased 3.6% to NIS 401 million ($115 million)
|
●
|
Subscriber base reached approx. 3.395 million at the end of March 2011, net addition of approx. 1,000 in the first quarter, following a decrease in the number of subscribers with more than one subscription to a cellular network, or double counted subscribers, and inactive subscribers as a result of the regulatory change
|
●
|
3G subscribers reached approx. 1.188 million at the end of March 2011, representing 35% of total subscriber base, net addition of approx. 48,000 in the first quarter 2011
|
●
|
The Company Declared first quarter dividend of NIS 2.93 per share
|
Q1/2011
|
Q1/2010
|
% Change
|
Q1/2011
|
Q1/2010
|
|
million NIS |
million US$
(convenience translation)
|
||||
Total revenues
|
1,587
|
1,580
|
0.4%
|
455.9
|
453.9
|
Total Services revenues (including revenues from content and value added services)
|
1,205
|
1,414
|
(14.8%)
|
346.2
|
406.2
|
Revenues from content and value added services
|
285
|
251
|
13.5%
|
81.9
|
72.1
|
Handset and accessories revenues
|
382
|
166
|
130.1%
|
109.7
|
47.7
|
Operating Income
|
471
|
457
|
3.1%
|
135.3
|
131.3
|
Net Income
|
306
|
314
|
(2.5%)
|
87.9
|
90.2
|
Free cash flow
|
401
|
387
|
3.6%
|
115.2
|
111.2
|
EBITDA
|
639
|
638
|
0.2%
|
183.6
|
183.3
|
EBITDA, as percent of Revenues
|
40.3%
|
40.4%
|
(0.2%)
|
||
Subscribers end of period
(in thousands)
|
3,395
|
3,313
|
2.5%
|
||
Monthly ARPU
|
115.2
|
139.1
|
(17.2%)
|
33.1
|
40.0
|
Average Monthly MOU
|
334
|
328
|
1.8%
|
Company Contact
Yaacov Heen
Chief Financial Officer
investors@cellcom.co.il
Tel: +972 52 998 9755
|
IR Contacts
Porat Saar & Kristin Knies
CCG Investor Relations Israel & US
cellcom@ccgisrael.com
Tel: +1 646 233 2161
|
Convenience
|
||||||||||||||||
translation
|
||||||||||||||||
into US dollar
|
||||||||||||||||
March 31,
|
March 31,
|
March 31,
|
December 31,
|
|||||||||||||
2011
|
2011
|
2010
|
2010
|
|||||||||||||
NIS millions
|
US$ millions
|
NIS millions
|
NIS millions
|
|||||||||||||
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
|||||||||||||
Assets
|
||||||||||||||||
Cash and cash equivalents
|
1,644 | 472 | 618 | 533 | ||||||||||||
Current investments, including derivatives
|
400 | 115 | 383 | 404 | ||||||||||||
Trade receivables
|
1,495 | 430 | 1,554 | 1,478 | ||||||||||||
Other receivables
|
65 | 19 | 71 | 64 | ||||||||||||
Inventory
|
123 | 35 | 134 | 104 | ||||||||||||
Total current assets
|
3,727 | 1,071 | 2,760 | 2,583 | ||||||||||||
Trade and other receivables
|
710 | 204 | 584 | 597 | ||||||||||||
Property, plant and equipment, net
|
2,017 | 579 | 2,060 | 2,063 | ||||||||||||
Intangible assets, net
|
704 | 202 | 704 | 753 | ||||||||||||
Total non-current assets
|
3,431 | 985 | 3,348 | 3,413 | ||||||||||||
Total assets
|
7,158 | 2,056 | 6,108 | 5,996 | ||||||||||||
Liabilities
|
||||||||||||||||
Debentures current maturities
|
590 | 169 | 344 | 348 | ||||||||||||
Trade payables and accrued expenses
|
790 | 227 | 718 | 716 | ||||||||||||
Current tax liabilities
|
89 | 25 | 83 | 132 | ||||||||||||
Provisions
|
87 | 25 | 87 | 84 | ||||||||||||
Other current liabilities, including derivatives
|
339 | 97 | 364 | 379 | ||||||||||||
Dividend declared
|
303 | 87 | - | - | ||||||||||||
Total current liabilities
|
2,198 | 630 | 1,596 | 1,659 | ||||||||||||
Debentures
|
4,536 | 1,303 | 3,983 | 3,913 | ||||||||||||
Provisions
|
16 | 5 | 17 | 17 | ||||||||||||
Other long-term liabilities
|
2 | 1 | 1 | 1 | ||||||||||||
Deferred taxes
|
62 | 18 | 81 | 65 | ||||||||||||
Total non-current liabilities
|
4,616 | 1,327 | 4,082 | 3,996 | ||||||||||||
Total liabilities
|
6,814 | 1,957 | 5,678 | 5,655 | ||||||||||||
Shareholders’ equity
|
||||||||||||||||
Share capital
|
1 | - | 1 | 1 | ||||||||||||
Cash flow hedge reserve
|
(21 | ) | (6 | ) | (24 | ) | (21 | ) | ||||||||
Retained earnings
|
364 | 105 | 453 | 361 | ||||||||||||
Total shareholders’ equity
|
344 | 99 | 430 | 341 | ||||||||||||
Total liabilities and shareholders’ equity
|
7,158 | 2,056 | 6,108 | 5,996 |
Three- month period ended
|
Year ended
|
|||||||||||||||
March 31,
|
December 31,
|
|||||||||||||||
Convenience
|
||||||||||||||||
translation
|
||||||||||||||||
into US dollar
|
||||||||||||||||
2011
|
2011
|
2010
|
2010
|
|||||||||||||
NIS millions
|
US$ millions
|
NIS millions
|
NIS millions
|
|||||||||||||
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
|||||||||||||
Revenues
|
1,587 | 456 | 1,580 | 6,662 | ||||||||||||
Cost of revenues
|
(750 | ) | (216 | ) | (801 | ) | (3,322 | ) | ||||||||
Gross profit
|
837 | 240 | 779 | 3,340 | ||||||||||||
Selling and marketing expenses
|
(209 | ) | (60 | ) | (163 | ) | (756 | ) | ||||||||
General and administrative expenses
|
(157 | ) | (45 | ) | (159 | ) | (641 | ) | ||||||||
Other expenses, net
|
- | - | - | (5 | ) | |||||||||||
Operating income
|
471 | 135 | 457 | 1,938 | ||||||||||||
Financing income
|
19 | 6 | 23 | 106 | ||||||||||||
Financing expenses
|
(86 | ) | (25 | ) | (59 | ) | (336 | ) | ||||||||
Financing income (expenses), net
|
(67 | ) | (19 | ) | (36 | ) | (230 | ) | ||||||||
Income before income tax
|
404 | 116 | 421 | 1,708 | ||||||||||||
Income tax
|
(98 | ) | (28 | ) | (107 | ) | (417 | ) | ||||||||
Net income
|
306 | 88 | 314 | 1,291 | ||||||||||||
Earnings per share
|
||||||||||||||||
Basic earnings per share in NIS
|
3.09 | 0.89 | 3.18 | 13.04 | ||||||||||||
Diluted earnings per share in NIS
|
3.09 | 0.89 | 3.16 | 12.98 | ||||||||||||
Three- month period ended
|
Year ended
|
|||||||||||||||
March 31,
|
December 31,
|
|||||||||||||||
Convenience
|
||||||||||||||||
translation
|
||||||||||||||||
into US dollar
|
||||||||||||||||
2011
|
2011
|
2010
|
2010
|
|||||||||||||
NIS millions
|
US$ millions
|
NIS millions
|
NIS millions
|
|||||||||||||
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
|||||||||||||
Cash flows from operating activities
|
||||||||||||||||
Net income for the period
|
306 | 88 | 314 | 1,291 | ||||||||||||
Adjustments for:
|
||||||||||||||||
Depreciation and Amortization
|
168 | 48 | 181 | 724 | ||||||||||||
Share based payments
|
- | - | - | 1 | ||||||||||||
Loss (gain) on sale of assets
|
- | - | - | 5 | ||||||||||||
Income tax expense
|
98 | 28 | 107 | 417 | ||||||||||||
Financial (income) expenses, net
|
67 | 19 | 36 | 230 | ||||||||||||
Changes in operating assets and liabilities:
|
||||||||||||||||
Changes in inventories
|
(19 | ) | (5 | ) | (5 | ) | - | |||||||||
Changes in trade receivables (including long- term amounts)
|
(117 | ) | (34 | ) | 76 | 172 | ||||||||||
Changes in other receivables (including long- term amounts)
|
(4 | ) | (1 | ) | (25 | ) | (6 | ) | ||||||||
Changes in trade payables and accrued expenses
|
122 | 35 | (34 | ) | (42 | ) | ||||||||||
Changes in other liabilities (including long-term amounts)
|
18 | 5 | 6 | (16 | ) | |||||||||||
Proceeds (payments) for derivative hedging contracts, net
|
(3 | ) | (1 | ) | (5 | ) | (16 | ) | ||||||||
Income tax paid
|
(120 | ) | (34 | ) | (100 | ) | (380 | ) | ||||||||
Net cash from operating activities
|
516 | 148 | 551 | 2,380 | ||||||||||||
Cash flows from investing activities
|
||||||||||||||||
Acquisition of property, plant, and equipment
|
(82 | ) | (23 | ) | (105 | ) | (441 | ) | ||||||||
Acquisition of intangible assets
|
(34 | ) | (10 | ) | (58 | ) | (180 | ) | ||||||||
Acquisition of operation
|
- | - | - | (108 | ) | |||||||||||
Change in current investments, net
|
2 | 1 | (138 | ) | (154 | ) | ||||||||||
Proceeds (payments) for other derivative contracts, net
|
(3 | ) | (1 | ) | (5 | ) | (17 | ) | ||||||||
Proceeds from sales of property, plant and equipment
|
1 | - | 1 | 2 | ||||||||||||
Interest received
|
3 | 1 | 3 | 9 | ||||||||||||
Net cash used in investing activities
|
(113 | ) | (32 | ) | (302 | ) | (889 | ) |
Three- month period ended
|
Year ended
|
|||||||||||||||
March 31,
|
December 31,
|
|||||||||||||||
Convenience
|
||||||||||||||||
translation
|
||||||||||||||||
into US dollar
|
||||||||||||||||
2011
|
2011
|
2010
|
2010
|
|||||||||||||
NIS millions
|
US$ millions
|
NIS millions
|
NIS millions
|
|||||||||||||
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
|||||||||||||
Cash flows from financing activities
|
||||||||||||||||
Proceeds from derivative contracts, net
|
4 | 1 | 13 | 34 | ||||||||||||
Proceeds (payments) for short term borrowings
|
- | - | (3 | ) | (8 | ) | ||||||||||
Repayment of debentures
|
(175 | ) | (50 | ) | (171 | ) | (343 | ) | ||||||||
Proceeds from issuance of debentures, net of issuance costs
|
1,033 | 297 | - | - | ||||||||||||
Dividend paid
|
(31 | ) | (9 | ) | (256 | ) | (1,319 | ) | ||||||||
Interest paid
|
(123 | ) | (36 | ) | (117 | ) | (225 | ) | ||||||||
Net cash used in financing activities
|
708 | 203 | (534 | ) | (1,861 | ) | ||||||||||
Changes in cash and cash equivalents
|
1,111 | 319 | (285 | ) | (370 | ) | ||||||||||
Balance of cash and cash equivalents at beginning of
|
||||||||||||||||
the period
|
533 | 153 | 903 | 903 | ||||||||||||
Balance of cash and cash equivalents at end of
|
||||||||||||||||
the period
|
1,644 | 472 | 618 | 533 |
Three-month period ended
March 31,
|
Year ended
December 31,
|
|||||||||||||||
2011
NIS millions
(Unaudited)
|
Convenience
translation
into US dollar
2011
US$ millions
(Unaudited)
|
2010
NIS millions
(Unaudited)
|
2010
NIS millions
(Audited)
|
|||||||||||||
Net income
|
306 | 88 | 314 | 1,291 | ||||||||||||
Income taxes
|
98 | 28 | 107 | 417 | ||||||||||||
Financing income
|
(19 | ) | (6 | ) | (23 | ) | (106 | ) | ||||||||
Financing expenses
|
86 | 25 | 59 | 336 | ||||||||||||
Other expenses (income)
|
- | - | - | 5 | ||||||||||||
Depreciation and amortization
|
168 | 48 | 181 | 724 | ||||||||||||
EBITDA
|
639 | 184 | 638 | 2,667 |
Three-month period ended
March 31,
|
Year ended
December 31,
|
|||||||||||||||
2011
NIS millions
(Unaudited)
|
Convenience
translation
into US dollar
2011
US$ millions
(Unaudited)
|
2010
NIS millions
(Unaudited)
|
2010
NIS millions
(Audited)
|
|||||||||||||
Cash flows from operating activities
|
516 | 148 | 551 | 2,380 | ||||||||||||
Cash flows from investing activities
|
(113 | ) | (32 | ) | (302 | ) | (889 | ) | ||||||||
Short-term Investment in tradable debentures
|
(2 | ) | (1 | ) | 138 | 154 | ||||||||||
Free Cash Flow
|
401 | 115 | 387 | 1,645 |
Page
|
|
Condensed Consolidated Interim Statements of Financial position
|
3
|
Condensed Consolidated Interim Statements of Income
|
4
|
Condensed Consolidated Interim Statements of Comprehensive Income
|
5
|
Condensed Consolidated Interim Statements of Changes in shareholders' equity
|
6
|
Condensed Consolidated Interim Statements of Cash Flows
|
7
|
Notes to the Condensed Consolidated Interim Financial Statements
|
9
|
Convenience
|
||||||||||||||||
translation
|
||||||||||||||||
into US dollar
|
||||||||||||||||
(Note 2D)
|
||||||||||||||||
March 31,
|
March 31,
|
March 31,
|
December 31,
|
|||||||||||||
2011
|
2011
|
2010
|
2010
|
|||||||||||||
NIS millions
|
US$ millions
|
NIS millions
|
NIS millions
|
|||||||||||||
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
|||||||||||||
Assets
|
||||||||||||||||
Cash and cash equivalents
|
1,644 | 472 | 618 | 533 | ||||||||||||
Current investments, including derivatives
|
400 | 115 | 383 | 404 | ||||||||||||
Trade receivables
|
1,495 | 430 | 1,554 | 1,478 | ||||||||||||
Other receivables
|
65 | 19 | 71 | 64 | ||||||||||||
Inventory
|
123 | 35 | 134 | 104 | ||||||||||||
Total current assets
|
3,727 | 1,071 | 2,760 | 2,583 | ||||||||||||
Trade and other receivables
|
710 | 204 | 584 | 597 | ||||||||||||
Property, plant and equipment, net
|
2,017 | 579 | 2,060 | 2,063 | ||||||||||||
Intangible assets, net
|
704 | 202 | 704 | 753 | ||||||||||||
Total non-current assets
|
3,431 | 985 | 3,348 | 3,413 | ||||||||||||
Total assets
|
7,158 | 2,056 | 6,108 | 5,996 | ||||||||||||
Liabilities
|
||||||||||||||||
Debentures current maturities
|
590 | 169 | 344 | 348 | ||||||||||||
Trade payables and accrued expenses
|
790 | 227 | 718 | 716 | ||||||||||||
Current tax liabilities
|
89 | 25 | 83 | 132 | ||||||||||||
Provisions
|
87 | 25 | 87 | 84 | ||||||||||||
Other current liabilities, including derivatives
|
339 | 97 | 364 | 379 | ||||||||||||
Dividend declared
|
303 | 87 | - | - | ||||||||||||
Total current liabilities
|
2,198 | 630 | 1,596 | 1,659 | ||||||||||||
Debentures
|
4,536 | 1,303 | 3,983 | 3,913 | ||||||||||||
Provisions
|
16 | 5 | 17 | 17 | ||||||||||||
Other long-term liabilities
|
2 | 1 | 1 | 1 | ||||||||||||
Deferred taxes
|
62 | 18 | 81 | 65 | ||||||||||||
Total non-current liabilities
|
4,616 | 1,327 | 4,082 | 3,996 | ||||||||||||
Total liabilities
|
6,814 | 1,957 | 5,678 | 5,655 | ||||||||||||
Shareholders’ equity
|
||||||||||||||||
Share capital
|
1 | - | 1 | 1 | ||||||||||||
Cash flow hedge reserve
|
(21 | ) | (6 | ) | (24 | ) | (21 | ) | ||||||||
Retained earnings
|
364 | 105 | 453 | 361 | ||||||||||||
Total shareholders’ equity
|
344 | 99 | 430 | 341 | ||||||||||||
Total liabilities and shareholders’ equity
|
7,158 | 2,056 | 6,108 | 5,996 | ||||||||||||
Three-month period ended
|
Year ended
|
|||||||||||||||
March 31,
|
December 31,
|
|||||||||||||||
Convenience
|
||||||||||||||||
translation
|
||||||||||||||||
into US dollar
|
||||||||||||||||
(Note 2D)
|
||||||||||||||||
2011
|
2011
|
2010
|
2010
|
|||||||||||||
NIS millions
|
US$ millions
|
NIS millions
|
NIS millions
|
|||||||||||||
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
|||||||||||||
Revenues
|
1,587 | 456 | 1,580 | 6,662 | ||||||||||||
Cost of revenues
|
(750 | ) | (216 | ) | (801 | ) | (3,322 | ) | ||||||||
Gross profit
|
837 | 240 | 779 | 3,340 | ||||||||||||
Selling and marketing expenses
|
(209 | ) | (60 | ) | (163 | ) | (756 | ) | ||||||||
General and administrative expenses
|
(157 | ) | (45 | ) | (159 | ) | (641 | ) | ||||||||
Other expenses, net
|
- | - | - | 5 | ||||||||||||
Operating income
|
471 | 135 | 457 | 1,938 | ||||||||||||
Financing income
|
19 | 6 | 23 | 106 | ||||||||||||
Financing expenses
|
(86 | ) | (25 | ) | (59 | ) | (336 | ) | ||||||||
Financing expenses, net
|
(67 | ) | (19 | ) | (36 | ) | (230 | ) | ||||||||
Income before income tax
|
404 | 116 | 421 | 1,708 | ||||||||||||
Income tax
|
(98 | ) | (28 | ) | (107 | ) | (417 | ) | ||||||||
Net income
|
306 | 88 | 314 | 1,291 | ||||||||||||
Earnings per share
|
||||||||||||||||
Basic earnings per share in NIS
|
3.09 | 0.89 | 3.18 | 13.04 | ||||||||||||
Diluted earnings per share in NIS
|
3.09 | 0.89 | 3.16 | 12.98 |
Three-month period ended
|
Year ended
|
|||||||||||||||
March 31,
|
December 31,
|
|||||||||||||||
Convenience
|
||||||||||||||||
translation
|
||||||||||||||||
into US dollar
|
||||||||||||||||
(Note 2D)
|
||||||||||||||||
2011
|
2011
|
2010
|
2010
|
|||||||||||||
NIS millions
|
US$ millions
|
NIS millions
|
NIS millions
|
|||||||||||||
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
|||||||||||||
Net change in fair value of cash flow hedges
|
||||||||||||||||
transferred to profit and loss
|
5 | 1 | 3 | (10 | ) | |||||||||||
Changes in fair value of cash flow hedges
|
(4 | ) | (1 | ) | (3 | ) | 9 | |||||||||
Income tax on other comprehensive income
|
(1 | ) | - | (1 | ) | 3 | ||||||||||
Other comprehensive income (loss), net of income tax
|
- | - | (1 | ) | 2 | |||||||||||
Net income for the period
|
306 | 88 | 314 | 1,291 | ||||||||||||
Total comprehensive income for the period
|
306 | 88 | 313 | 1,293 |
Share capital
amount
|
Cash flow hedge reserve
|
Retained earnings
|
Total
|
Convenience translation into US dollar (Note 2D)
|
||||||||||||||||
NIS millions |
US$ millions
|
|||||||||||||||||||
For the three-month period ended March 31, 2011
|
||||||||||||||||||||
(Unaudited)
|
||||||||||||||||||||
Balance as of January 1, 2011
|
||||||||||||||||||||
(Audited)
|
1 | (21 | ) | 361 | 341 | 98 | ||||||||||||||
Other comprehensive income for the year, net of tax
|
- | - | - | - | - | |||||||||||||||
Net income for the period
|
- | - | 306 | 306 | 88 | |||||||||||||||
Cash dividend declared
|
- | - | (303 | ) | (303 | ) | (87 | ) | ||||||||||||
Balance as of March 31, 2011
|
1 | (21 | ) | 364 | 344 | 99 |
Share capital
amount
|
Cash flow hedge reserve
|
Retained earnings
|
Total
|
||||||||||||||
NIS millions
|
|||||||||||||||||
For the three-month period ended March 31, 2010
|
|||||||||||||||||
(Unaudited)
|
|||||||||||||||||
Balance as of January 1, 2010
|
|||||||||||||||||
(Audited)
|
1 | (23 | ) | 396 | 374 | ||||||||||||
Other comprehensive income for the year, net of tax
|
- | (1 | ) | - | (1 | ) | |||||||||||
Net income for the period
|
- | - | 314 | 314 | |||||||||||||
Cash dividend paid
|
- | - | (257 | ) | (257 | ) | |||||||||||
Balance as of March 31, 2010
|
1 | (24 | ) | 453 | 430 |
Share capital
amount
|
Cash flow hedge reserve
|
Retained earnings
|
Total
|
||||||||||||||
NIS millions | |||||||||||||||||
For the year ended December 31, 2010
|
|||||||||||||||||
(Audited)
|
|||||||||||||||||
Balance as of January 1, 2010
|
|||||||||||||||||
(Audited)
|
1 | (23 | ) | 396 | 374 | ||||||||||||
Other comprehensive income for the year, net of tax
|
- | 2 | - | 2 | |||||||||||||
Net income for the year
|
- | - | 1,291 | 1,291 | |||||||||||||
Share based payments
|
- | - | 1 | 1 | |||||||||||||
Cash dividend paid
|
- | - | (1,327 | ) | (1,327 | ) | |||||||||||
Balance as of December 31, 2010
|
1 | (21 | ) | 361 | 341 |
Three-month period ended
|
Year ended
|
|||||||||||||||
March 31,
|
December 31,
|
|||||||||||||||
Convenience
|
||||||||||||||||
translation
|
||||||||||||||||
into US dollar
|
||||||||||||||||
(Note 2D)
|
||||||||||||||||
2011
|
2011
|
2010
|
2010
|
|||||||||||||
NIS millions
|
US$ millions
|
NIS millions
|
NIS millions
|
|||||||||||||
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
|||||||||||||
Cash flows from operating activities
|
||||||||||||||||
Net income for the period
|
306 | 88 | 314 | 1,291 | ||||||||||||
Adjustments for:
|
||||||||||||||||
Depreciation and Amortization
|
168 | 48 | 181 | 724 | ||||||||||||
Share based payments
|
- | - | - | 1 | ||||||||||||
Loss on sale of assets
|
- | - | - | 5 | ||||||||||||
Income tax expense
|
98 | 28 | 107 | 417 | ||||||||||||
Financial expenses, net
|
67 | 19 | 36 | 230 | ||||||||||||
Changes in operating assets and liabilities:
|
||||||||||||||||
Changes in inventories
|
(19 | ) | (5 | ) | (5 | ) | - | |||||||||
Changes in trade receivables (including long-term amounts)
|
(117 | ) | (34 | ) | 76 | 172 | ||||||||||
Changes in other receivables (including long-term amounts)
|
(4 | ) | (1 | ) | (25 | ) | (6 | ) | ||||||||
Changes in trade payables and accrued expenses
|
122 | 35 | (34 | ) | (42 | ) | ||||||||||
Changes in other liabilities (including long-term amounts)
|
18 | 5 | 6 | (16 | ) | |||||||||||
Payments for derivative hedging contracts, net
|
(3 | ) | (1 | ) | (5 | ) | (16 | ) | ||||||||
Income tax paid
|
(120 | ) | (34 | ) | (100 | ) | (380 | ) | ||||||||
Net cash from operating activities
|
516 | 148 | 551 | 2,380 | ||||||||||||
Cash flows from investing activities
|
||||||||||||||||
Acquisition of property, plant, and equipment
|
(82 | ) | (23 | ) | (105 | ) | (441 | ) | ||||||||
Acquisition of intangible assets
|
(34 | ) | (10 | ) | (58 | ) | (180 | ) | ||||||||
Acquisition of operation
|
- | - | - | (108 | ) | |||||||||||
Change in current investments, net
|
2 | 1 | (138 | ) | (154 | ) | ||||||||||
Payments for other derivative contracts, net
|
(3 | ) | (1 | ) | (5 | ) | (17 | ) | ||||||||
Proceeds from sales of property, plant and equipment
|
1 | - | 1 | 2 | ||||||||||||
Interest received
|
3 | 1 | 3 | 9 | ||||||||||||
Net cash used in investing activities
|
(113 | ) | (32 | ) | (302 | ) | (889 | ) |
Three-month period ended
March 31,
|
Year ended
December 31, |
|||||||||||||||
Convenience
|
||||||||||||||||
translation
|
||||||||||||||||
into US dollar
|
||||||||||||||||
(Note 2D)
|
||||||||||||||||
2011
|
2011
|
2010
|
2010
|
|||||||||||||
NIS millions
|
US$ millions
|
NIS millions
|
NIS millions
|
|||||||||||||
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
|||||||||||||
Cash flows from financing activities
|
||||||||||||||||
Proceeds from derivative contracts, net
|
4 | 1 | 13 | 34 | ||||||||||||
Payments for short term borrowings
|
- | - | (3 | ) | (8 | ) | ||||||||||
Repayment of debentures
|
(175 | ) | (50 | ) | (171 | ) | (343 | ) | ||||||||
Proceeds from issuance of debentures, net of issuance costs
|
1,033 | 297 | - | - | ||||||||||||
Dividend paid
|
(31 | ) | (9 | ) | (256 | ) | (1,319 | ) | ||||||||
Interest paid
|
(123 | ) | (36 | ) | (117 | ) | (225 | ) | ||||||||
Net cash provided from(used in) financing activities
|
708 | 203 | (534 | ) | (1,861 | ) | ||||||||||
Changes in cash and cash equivalents
|
1,111 | 319 | (285 | ) | (370 | ) | ||||||||||
Balance of cash and cash equivalents at beginning of the period
|
533 | 153 | 903 | 903 | ||||||||||||
Balance of cash and cash equivalents at end of the period
|
1,644 | 472 | 618 | 533 |
A.
|
Statement of compliance
|
B.
|
Functional and presentation currency
|
C.
|
Basis of measurement
|
D.
|
Convenience translation into U.S. dollars (“dollars” or “$”)
|
E.
|
Use of estimates and judgments
|
F.
|
Exchange rates and Consumer Price Indexes are as follows:
|
Exchange rates
of US$
|
Consumer Price
Index (points)
|
|||||||
As of March 31, 2011
|
3.481 | 213.1 | ||||||
As of March 31, 2010
|
3.713 | 204.4 | ||||||
As of December 31, 2010
|
3.549 | 211.7 | ||||||
Increase (decrease) during the period:
|
||||||||
Three months ended March 31, 2011
|
(1.9 | %) | 0.7 | % | ||||
Three months ended March 31, 2010
|
(1.6 | %) | (0.9 | %) | ||||
Year ended December 31, 2010
|
(5.9 | %) | 2.7 | % |
1.
|
IAS 24 (2009) Related Party Disclosures (hereinafter – “the Standard”). The new standard includes changes in the definition of a related party and changes with respect to disclosures required by entities related to government. The Standard is to be applied retrospectively for annual periods beginning on or after January 1, 2011. The amendment has no material impact on the Company's financial statements.
|
2.
|
Amendment to IAS 34 Interim Financial Reporting – Significant events and transactions (hereinafter – “the Amendment”) – The Amendment expanded the list of events and transactions that require disclosure in interim financial statements, such as the recognition of a loss from the impairment in value of financial assets and changes in the classification of assets as a result of changes in their purpose or use. In addition, the materiality threshold was removed from the minimum disclosure requirements included in the Standard before its amendment. The Amendment was applied for interim periods beginning after January 1, 2011.
|
3.
|
Amendment to IFRS 7 Financial Instruments: Disclosures – Clarification of disclosures (hereinafter – “the Amendment”) – The Amendment requires adding an explicit declaration that the interaction between the qualitative and quantitative disclosures enables the users of the financial statements to better assess the company’s exposure to risks arising from financial instruments. Furthermore, the clause stating that quantitative disclosures are not required when the risk is immaterial was removed, and certain disclosure requirements regarding credit risk were amended while others were removed. The Amendment is effective for annual periods beginning on or after January 1, 2011.
|
1.
|
In September 2000, a purported class action lawsuit was filed against the Company in the District Court of Tel-Aviv–Jaffa by one of the Company’s subscribers in connection with VAT charges in respect of insurance premiums and the provision of insurance services that were allegedly provided not in accordance with the law. In April 2011, the purported class action was dismissed with prejudice. Had the lawsuit been certified as a class action, the amount claimed was estimated by the plaintiff to be NIS 402 million.
|
2.
|
In November 2006, a purported class action lawsuit was filed against the Company, a third party that had provided services to customers of the Company (“the Supplier”) and other parties allegedly related to the Supplier, in the District Court of Tel-Aviv–Jaffa by a subscriber of the Company. The lawsuit is in connection with sums allegedly charged by the Company in respect of content services of the Supplier without the subscriber’s consent. The request to certify the lawsuit as a class action was approved in March 2009. The total amount claimed from the Company, the Supplier and other parties was estimated by the plaintiffs as approximately NIS 18 million, in addition to another NIS 10 million for mental anguish. In April 2011, the Court approved a settlement by which two content companies will be joined as defendants and will return the amount charged (adjusted to changes in the Israeli Consumer Price Index for July 2006) in respect of the content services provided by the Supplier, to the Company's subscribers. The Company will guarantee the return of the charges by the content companies. The return sum (before index differences) is estimated to be approximately NIS 2.35 million. An additional amount equal to 18% of the return sum shall be paid as compensation to the plaintiff and his lawyer by the content companies.
|
3.
|
In July 2008, a purported class action lawsuit was filed against the Company in the District Court of Tel Aviv-Jaffa, by a plaintiff alleging to be a subscriber of the Company in connection with allegations that the Company misleads and overcharges certain subscribers, in relation to airtime packages. If the lawsuit is certified as a class action, the amount claimed is estimated by the plaintiff to be approximately NIS 72 million. In April 2011, the Court approved a settlement by which the Company shall return to an agreed group the sum paid by them for exceeding the package. The total return sum for all the members of the plaintiffs group is estimated to be approximately NIS 1.35 million. An additional amount equal to approximately NIS 440 thousand shall be paid as compensation to the
|
4.
|
In March 2011, a purported class action lawsuit was filed against the Company in the District Court of Tel Aviv-Jaffa, by a plaintiff alleging to be the Company's subscriber, in connection with allegations that the Company discriminates subscribers based on their belonging to a religious group in violation of Prohibition on Discrimination in Products Law. If the lawsuit is certified as a class action, the total amount claimed from the Company is estimated by the plaintiff to be approximately NIS 60 million. At this preliminary stage, the Company is unable to assess the lawsuit's chances of success.
|
5.
|
In April 2011, subsequent to the reporting date, a purported class action lawsuit was filed against the Company in the District Court of Central region, by a plaintiff alleging to be the Company's subscriber, in connection with allegations that the Company misleads its subscribers in relation to the receipt of certain end user equipment without charge while charging them for an ancillary service. If the lawsuit is certified as a class action, the total amount claimed from the Company is estimated by the plaintiff to be approximately NIS 48 million. At this preliminary stage, the Company is unable to assess the lawsuit's chances of success.
|
6.
|
In April 2011, subsequent to the reporting date, a purported class action lawsuit was filed against the Company in the District Court of Central region, by a plaintiff alleging to be the Company's subscriber, in connection with allegations that the Company unlawfully charges its subscribers with a commission for bills paid in cash in the Israeli Postal Service branches. If the lawsuit is certified as a class action, the total amount claimed from the Company is estimated by the plaintiff to be approximately NIS 151 million. At this preliminary stage, the Company is unable to assess the lawsuit's chances of success.
|
7.
|
In April 2011, subsequent to the reporting date, a purported class action lawsuit was filed against the Company in the District Court of Central region, by a plaintiff alleging to have used the Company's pre paid services, in connection with allegations that the Company unlawfully failed to inform such subscribers that it does not allow them to make calls when their pre-paid balance falls below NIS 3. If the lawsuit is certified as a class action, the total amount claimed from the Company (mostly for non-monetary damages) is estimated by the plaintiff to be approximately NIS 161 million. At this preliminary stage, the Company is unable to assess the lawsuit's chances of success.
|
8.
|
In May 2011, subsequent to the reporting date, a purported class action lawsuit was filed against the Company and another cellular operator in the District Court of Tel Aviv-Jaffa, by a plaintiff alleging to be a former subscriber of the Company and a subscriber of the other cellular operator, in connection with allegations that the defendants allegedly did not allow subscribers that stopped their subscription with the Company to pay for end user equipment in installments, in violation of the law. If the lawsuit is certified as a class action, the total amount claimed from the defendants (half of which for non-monetary damages) is estimated by the plaintiff to be approximately NIS 200 million, without specifying the amount attributed to the Company individually. At this preliminary stage, the Company is unable to assess the lawsuit's chances of success.
|
Share price at grant date
|
$31.58
|
Exercise price
|
$31.74
|
Expected volatility (weighted average life)
|
24.35%
|
Option life (expected weighted average life)
|
2.3 years
|
Risk free interest rate (weighted average)
|
0.7%
|
CELLCOM ISRAEL LTD.
|
|||||||
Date:
|
May 16, 2011
|
By:
|
/s/ Liat Menahemi Stadler
|
||||
Name:
|
Liat Menahemi Stadler
|
||||||
Title:
|
General Counsel
|