Partner Communications' CEO Discusses Q1 2012 Results - Earnings Call Transcript

Partner Communications Company Ltd. (PTNR)

Q1 2012 Earnings Results Conference

May 23, 2012 10:00 am ET


Haim Romano - CEO

Ziv Leitman - CFO

Gideon Koch - Manager, Revenues-Finance Department


Gilad Alper - Excellence Nessuah Investment House

Michael Klahr - Citigroup

David Kaplan – Barclays Capital



Welcome to the Partner Communications Company First Quarter 2012 Results Conference Call. All participants are at present in 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 May 23, 2012.

I would now like to turn over the call 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 results for the first quarter of 2012.

With me on the call today is Haim Romano, Partners’ CEO; and Ziv Leitman, our CFO. Haim Romano will open the call by giving some thoughts about the recent developments in the market here in Israel. Ziv, will then discuss our financial and operational results for the quarter. And finally, we will move on to the Q&A.

Before we begin, I would like to draw your attention to the fact that all statements in this conference call may be forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, 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 should be aware that Partner’s actual results might 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 May 23, 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 Following the call, if you have any further questions, please feel free to contact our Head of Investor Relations in Israel, Yaffa Cohen-Ifrah on 972-54-9099039.

I will now turn the call over to Partner’s CEO Haim Romano. Haim?

Haim Romano

Thank you, Gideon. Good morning, everyone and welcome to our first quarter of 2012 conference call. The financial results of the first quarter reflect the competition in the markets and the challenging times of the cellular industry in Israel over the last past few years.

We continue as planned in some addition of the efficiency measures with a contribution of the decrease of NIS 80 million in operating expenses during the last six months. The full effect of the efficiency plan will be reflected in the upcoming months as we progress with the plan that will be limited.

As part of the overall process, we have reduced the number of positions by 1,440 positions from October 2011 until the end of April 2012. We also allocated a process of full operating merger between partner Orange and 012 Smile and that is expected to be completed in the last – third quarter of this year.

The full merger we enhance our focus on the customer and will enable us to provide a diverse range of services at home and mobile. Last week we saw a significant change in the cellular market in Israel.

With two new operators launching the operations with an unlimited plan, offering prices that were far beyond the relevant prices in the market (indiscernible). We are prepared to the competition and we have updated our marketing offers to the new market price levels.

At the same time, as – and especially in light of the recent events, we are required to examine and to adjust our business plans to the new realities. We will continue with our efficiency plan and even enhances. We will continue with our investments as planned. We will invest a large amount of money in resources to upgrade our network and in August this year we will complete and upgrade the most parts of the Israeli population geography with our sites, and we will have covered the major population centers.

At the same time our IT system recovery plan is progressing as planned. We are also looking ahead focusing on the future potential growth [Technical difficulty] over the internet. We intend to launch during the next six months a television and content services over the internet, OTT, subject to removal of regulatory barriers by the MOC. This services will be added to a wide range of services offered by the Company and at significantly lower price.

In closing, I’m convinced that our unique spirit and continued investments of – continuous investments on our assets, our value customers, employees in the Orange brands, we will continue to serve as a platform to promote our business and cope with the future challenges.

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

Ziv Leitman

Thank you, Haim. Given the 12-month is equivalent to a life time in our industry; I will limit my comments to the results of the first quarter compared with the previous quarter.

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