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Partner Communications Reports Fourth Quarter And Annual 2012 Results1

Stocks in this article: PTNR

Operating expenses (including cost of service revenues, selling, marketing and administrative expenses and excluding depreciation and amortization) totaled NIS 3,262 million (US$ 874 million) in 2012, a decrease of 7% or NIS 255 million from 2011, largely reflecting the series of efficiency measures undertaken over the last year, and in particular the reduction of the workforce by approximately 40% over the period. The decrease was despite the full-year contribution of 012 Smile in 2012 compared with only a ten-month contribution in 2011.

For Q4 2012, operating expenses totaled NIS 744 million (US$ 199 million), a decrease of 16% or NIS 145 million from Q4 2011, as described above as well as a one-time reduction in site-rental expenses of NIS 18 million.

Operating profit for 2012 was NIS 865 million (US$ 232 million), a decrease of 17% compared with reported operating profit for 2011 including an impairment charge impact of NIS 322 million (related principally to certain fixed line assets acquired in connection with the purchase of 012 Smile). The decrease amounted to 36% when compared with operating profit before the impact of the impairment.

In Q4 2012, operating profit was NIS 155 million (US$ 42 million), compared with a reported operating loss in Q4 2011 of NIS 55 million due to the impairment charge impact of NIS 322 million in the quarter. Compared to operating profit before the impairment charge impact in Q4 2011, operating profit for Q4 2012 decreased by 42%.

Annual EBITDA totaled NIS 1,602 million (US$ 429 million) in 2012, a decrease of 26% from NIS 2,178 million in 2011. EBITDA for the cellular segment was NIS 1,314 million (US$ 352 million) in 2012, decreasing by 31% from NIS 1,896 million in 2011, reflecting the impact of the reduction in service revenues and in gross profit from equipment revenues, partially offset by the reduction in operating expenses (including cost of service revenues, selling, marketing and administrative expenses and excluding depreciation and amortization), as described above. EBITDA for the fixed line segment in 2012 was NIS 288 million (US$ 77 million), an increase of 2% from NIS 282 million in 2011, reflecting the reduction in operating expenses and the impact of the full-year contribution of 012 Smile in 2012 compared with only ten months in 2011, partially offset by the reduction in service revenues.

For Q4 2012, EBITDA was NIS 340 million (US$ 91 million), a decrease of 29% from NIS 478 million in Q4 2011. The cellular segment contributed EBITDA of NIS 256 million (US$ 69 million) in the quarter, decreasing by 37% from Q4 2011, and the fixed line segment contributed EBITDA of NIS 84 million (US$ 23 million), an increase of 18% compared with Q4 2011.

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