Cellcom concluded its third quarter with a net loss of NIS 2 million

Cellcom Telecom concluded its third quarter of 2019 with an increase in revenue, but erosion in operating profit and a net loss. The company posted revenues of NIS 938 million, an increase of 3.1% compared to the corresponding quarter last year. In contrast, operating income dropped by 20% to NIS 32 million, and a net loss of NIS 2 million was recorded, compared with a net profit of NIS 1 million in the corresponding quarter.
As of the beginning of the year, Cellcom's loss amounts to NIS 53 million. Implementation of the IFRS 16 Accounting Standard (which deals with leases) helped Cellcom show an increase in both adjusted EBITDA (profit excluding interest, tax, depreciation and amortization) and cash flow from operating activities. EBITDA amounted to NIS 271 million, an increase of about 42% compared to the corresponding quarter, with the implementation of the standard contributing NIS 72 million to this item; Another contribution to EBITDA was NIS 8 million due to the sale of fiber infrastructure to IBC. Cash flow from operations amounted to NIS 273 million, of which NIS 71 million was contributed to the implementation of the standard. On the other hand, Cellcom reports that IFRS 16 this quarter increased its loss by NIS 1 million.
In the segment for operating segments, the mobile sector posted revenues of NIS 611 million in the third quarter, an increase of 3.7% compared to the corresponding quarter last year, despite a 0.9% decrease in service revenues to NIS 439 million. The increase in end-equipment revenue offset the decline with a 17.8% increase over the same quarter to the NIS 172 million level. Adjusted EBITDA in the mobile segment amounted to NIS 185 million, compared with NIS 118 million in the corresponding quarter.
At the end of the quarter, Cellcom had about 2.76 million mobile subscribers, down 2.1% from the corresponding quarter last year; And the abandonment rate for the quarter was 11.4%, higher than the same quarter. Average monthly mobile subscription revenue (ARPU) increased from NIS 52.5 in the same quarter to NIS 53.2 in the third quarter of 2019.
The stationary sector, which includes landline telephony, Internet, TV and more, contributed NIS 368 million in revenue, up 1.7% on the same quarter. Adjusted EBITDA for this segment amounted to NIS 86 million, an increase of 17.8%. At the end of the quarter, Cellcom had 276,000 subscribers (households) in the Internet infrastructure and 247,000 TV subscribers.