We will continue to strengthen Cellcom Israel's position as a leading communications group, by leveraging future opportunities, such as the wireline wholesale market and entering new areas of activity, such as cellular credit card and the examination of entry into IPTV".
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.
The Company's Board of Directors decided not to distribute a dividend for the third quarter of 2012, in order to strengthen the Company's balance sheet at this time of market uncertainty. The Board of directors will re-evaluate its decision in the coming quarters as market conditions develop, and taking into consideration the Company's needs".Main Consolidated Financial Results (financial data for Q3/2011, includes Netvision's results for September 2011 only) :
Q3/2012 Q3/2011 (*) % Change Q3/2012 Q3/2011 million US$ (convenience million NIS translation) Total revenues 1,448 1,665 (13.0%) 370.1 425.6 Operating profit 239 349 (31.5%) 61.1 89.2 Net income 124 199 (37.7%) 31.7 50.9 Free cash flow 414 262 58.0% 105.8 67.0 EBITDA 430 537 (19.9%) 109.9 137.3 EBITDA, as percent of total revenues 29.7% 32.3% (8.0%)(*) Since the merger transaction with Netvision was completed on August 31, 2011, Q3/2011 consolidated financial results include Netvision's results for September 2011 only. Main Financial Data by Companies:
Cellcom Israel without Consolidation adjustments Consolidated Netvision Netvision (*) results Change Q3/2012 Q3/2011 (%) Q3/2012 Q3/2012 Total revenues 1,187 1,567 (24.3%) 291 (30) 1,448 Total service revenues  902 1,101 (18.1%) 276 (30) 1,148 Equipment revenues 285 466 (38.8%) 15 - 300 Operating profit 220 350 (37.1%) 45 (26) 239 EBITDA 355 517 (31.3%) 75 - 430 EBITDA, as percent of total revenues 29.9% 33.0% (9.4%) 25.8% - 29.7%(*)Include elimination of inter-company revenues between Cellcom Israel and Netvision, and amortization expenses attributable to the merger.
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