Phone company Bezeq will be allowed to write down its increased share in losses incurred by the YES satellite broadcasting company over ten years, TheMarker.com has learned.
Bezeq recently increased its stake in YES from 30% to 45%, necessarily increasing its portion of its losses. Based on an estimated need to write down the book value of YES's goodwill by NIS 180 million, during ten years Bezeq will be posting an annual charge of NIS 18 million, or NIS 4.5 million per quarter as of the fourth quarter of 2001.
YES reported losing a net NIS 204 million for the third quarter, slightly down from the NIS 208 million it lost in the second quarter.
Earnings before interest, taxes, depreciation and amortization decreased to NIS 130 million, compared with NIS 145 for the second quarter.
Revenue increased to NIS 84.5 million, 36% more than for the second quarter, when revenue was NIS 62 million.
Average revenue per user per month is estimated at NIS 170,000, compared with an estimated ARPU per month of NIS 130,000 by the cable companies.
Charges for content, technical and customer services for the third quarter rose to NIS 189.5 million, compared with NIS 161.3 million for the second quarter, due to an increase in original productions.
Total investment in content per subscriber per month came to NIS 125,000, compared with an estimated investment of NIS 73,000 per month by the cable companies (estimate by YES).
Subscriber recruitment costs in the third quarter dropped by 18% against the first quarter. The drop is due to a decrease in the cost of satellite decoders, and decrease in installation equipment costs. In addition, YES claims that the abandonment rate has dropped.
YES believes that subscriber recruitment costs will continue to tumble because a month ago the company terminated its agreement with engineering company Baran, which had installed its equipment.
The company's efficiency measures and decreased costs expenditure cut gross losses to NIS 299.6 million for the first nine months, compared with NIS 327.9 million allocated for this in the company¿s budget.
Operating losses for the first nine months came to NIS 543.4 million, compared with NIS 556.7 million in the company¿s budget.
YES CEO Shlomo Liran said that although the cable companies in the third quarter for the first time entered into digitalization and tiering, YES posted an increase in its recruitment of new subscribers for the third quarter, and netted another 48,000 new subscribers, compared with 41,000 new subscribers for the second quarter.
As of November 20, the company had 240,000 subscribers, extrapolating to a recruitment rate of 20,000 households a month.