Partner Communications' CEO Discusses Q4 2011 Results - Earnings Call Transcript

Partner Communications Company Ltd. ( PTNR)

Q4 2011 Earnings Call

February 22, 2012 10:00 am ET

Executives

Gideon Koch – Manager, Revenues-Finance Department

Haim Romano – Chief Executive Officer

Ziv Leitman – Chief Financial Officer

Analysts

David Kaplan – Barclays Capital

Michael Klahr – Citibank

Presentation

Operator

Ladies and gentlemen, thank you for standing by. Welcome to the Partner Communications Company Fourth Quarter and Year End 2011 Results Conference Call. All participants are, at present, in a listen-only mode. (Operator Instructions)

Following management’s formal presentation, instructions will be given for the question-and-answer session. As a reminder, this conference is being recorded, February 22, 2012.

I would now like to turn the call over to Mr. Gideon Koch. Mr. Koch, please begin.

Gideon Koch

Thank you. And thank you to all our listeners for joining us on this conference call to discuss Partner Communications’ estimated results for the fourth quarter and the year 2011. With me on the call today is Haim Romano, Partner’s CEO; and Ziv Leitman, our CFO.

Haim Romano, our CEO is going to open discussion with an overview of Partner’s strategy, then Ziv will cover our financial and operational results for the quarter. And finally, we’ll move on to the Q&A.

Before we begin, I would like to draw your attention to the fact that all statements in this call may be forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1932, as amended; Section 21E of the U.S. Securities and Exchange Act of 1934, as amended; and the Safe Harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Regarding such oral forward-looking statements, you maybe aware that Partner’s actual results may vary materially from those projected in the forward-looking statements.

Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements are contained in Partner’s press release dated February 22, 2012; as well as Partner’s prior filings with the U.S. Securities and Exchange Commission on Forms 20-F, F-1 and 6-K, as well as the S-3 shelf registration statement, all of which are readily available. Please note that the information in this conference call related to projections or other forward-looking statements is subject to the previous Safe Harbor Statement as of the date of this call.

For your information, this call is being broadcast simultaneously over the Internet and can be accessed through our website at www.orange.co.il. I will now turn the call over to Partner’s CEO, Haim Romano. Haim?

Haim Romano

Hi. Thank you, Gideon, and good morning everyone in U.S. and good afternoon to everyone else. Partner reports today the main estimates fourth quarter and full year results. The financial results for 2011 reflected changing market conditions, the effect of the regulatory changes, as well as increasing competition in the Israeli telecommunication market.

The tough market conditions required us to adjust our organization and to act accordingly while maintaining our assets and improving operational profit. We are now in a transition period, and we’ll have to take some measures and we do take them to attract the new market conditions. I’d like to take the opportunity and name few of them.

Our main focus is the customer. We have a long tradition of treating our customers as our main assets. We will continue to take all the necessary steps in order to protect (inaudible).

In the fourth quarter we started to implement a number of measures in order to improve our customer experience, which just started (inaudible) the offers to the customers by introduction of new packages named Orange Clear. That are simple and a straight forward packages, and we will now have more than 120,000 subscribers in the Orange Clear package.

During the fourth quarter, we began to reduce our level of workforce, as we mentioned in the last conference call with you. And at the same time, checking our operational efficiency measures to better address the new challenges.

With respect to the fixed-line segment, during the fourth quarter, the structural separations, which means the Orange brand and 012 was terminated. And we started the process of managing the fixed-line business or the businesses of Orange and 012 Smile.

We’re currently in the process of integrating most of the head quarter activities under one management, the management of Partner in a new management structure to maximize operating activities.

We are accelerating our investments, upgrading our network towards the 4G technology and as well as a fixed-line network. We expect that by the end of this year, approximately 1,500 cellular sites will be LTE ready. We continue to closely examine new growth engines.

Our long-term strategy is to provide an excellent customer experience that will differentiate us to a full high quality of network, outstanding customer service and innovative marketing initiative and professional help to channels. Putting all this together, during these coming years, we strengthened Orange’s position as a leading brand.

I’d like now to hand over the call to Mr. Ziv Leitman, our CFO.

Ziv Leitman

Thank you, Haim. The company is currently examining the development in the Internet Service Providers’ market, and the possible impact if any on the company and its results. In addition, the company is still examining the necessity if any of the impairment of intangible assets of the fixed-line segment.

As a result, the company is reporting at this time, the main estimated results and operating indication for the fourth quarter and for the year 2011. The final and complete results for the fourth quarter and for the year 2011 will be published towards the end of March 2012, at the same time the company publishes its audited financial report for 2011. You will appreciate that since we are only releasing the key estimated results and operating indices, so today my remarks will be limited to discussing the released results. I’m also going to focus my remarks on the quarterly results, rather than on the annual results.

Read the rest of this transcript for free on seekingalpha.com