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Bezeq Israel Telecommunication : Transcript – Earnings Webcast – English

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Bezeq Q3 2022 Monetary Outcomes Transcript

Wednesday, November sixteenth, 2022

“Bezeq” The Israel Telecommunication Corp., Ltd.

Occasion Transcript

Q3 2022 Monetary Outcomes

Wednesday, November sixteenth, 2022, 15:00 Israel Time

DISCLAIMER

This doc features a transcript of the convention name held on the above date concerning the Firm’s monetary outcomes for the second quarter of 2020, following the publication of the Firm’s monetary statements at that date, in addition to the publication of the Firm’s investor presentation filed beneath the Israeli Securities Legislation 1968 (“Securities Legislation”).

This doc consists of statements made at that convention name and accordingly accommodates solely partial data concerning the Firm’s monetary outcomes and the Firm’s periodic experiences printed beneath the Securities Legislation. The experiences may be accessed on the Israeli Securities Authority’s web site, www.magna.isa.gov.il. A overview of this transcript and/or the aforementioned investor presentation printed by the Firm isn’t an alternative choice to a overview of the detailed experiences of the Firm beneath the Securities Legislation and isn’t meant to exchange or qualify the complete experiences. The Firm isn’t accountable for the accuracy or completeness of the knowledge contained on this doc. This transcript doesn’t represent a suggestion or invitation to buy or subscribe for any securities of the Firm, and neither this transcript nor something contained herein shall kind the premise of, or be relied upon in reference to any contract or dedication in any respect.

Bezeq Q3 2022 Monetary Outcomes Transcript

Wednesday, November sixteenth, 2022

Q3 2022 Monetary Outcomes

Tobi Fischbein

Welcome everybody, and thanks for becoming a member of us on Bezeq’s 2022 third-quarter earnings name. I’m Tobi Fischbein, Bezeq Group CFO. With us from the Bezeq Group’s senior administration staff are Mr. Gil Sharon, Bezeq’s Chairman, Mr. Ran Guron, Bezeq’s CEO, and Mr. Ilan Sigal, CEO of Pelephone, sure and Bezeq Worldwide.

Earlier than we begin, I want to draw your consideration to the Protected Harbor assertion on Slide 2 of our Q3-2022 investor presentation, which additionally applies to any assertion made throughout at present’s name. We want to inform you that this occasion is being recorded. After presenting our quarterly outcomes, you may ask questions by elevating your hand nearly.

Let me now flip the decision over to our Chairman, Mr. Gil Sharon for his opening remarks. After his introduction, I’ll proceed the presentation of our group monetary highlights, adopted by Ran, who will talk about Bezeq Mounted Line outcomes, and Ilan, who will conclude with the outcomes of our subsidiaries.

Gil Sharon

Thanks, Tobi. Let’s begin on Slide 3. We posted robust monetary ends in the third quarter of the 12 months, which stand out positively versus the background of the financial turmoil that the world is experiencing, and as a result of profitable implementation of our progress technique. We continued to emphasise funding in progress associated infrastructure, that are nicely mirrored in our third quarter outcomes. In fixed-line, we had report take up of 51 thousand fiber clients and continued progress in retail broadband ARPU resulting in income progress of 5% year-over-year. In Pelephone, roaming restoration and continued progress in 5G subscribers contributed to larger ARPU and important enhancements in Pelephone’s monetary outcomes with a 12% year-over-year improve in revenues. sure launched its TV and Bezeq fiber bundle and we continued to pay down debt and distribute dividends.

Shifting to the subsequent slide, within the third quarter we noticed stable top-line progress coupled by will increase in Adjusted EBITDA and Adjusted Internet Revenue. On the stability sheet, we diminished our web debt by 600 million shekels, or 10% from a 12 months in the past, additional enhancing our web debt to EBITDA ratio to 1.7, from 1.9 in the identical quarter final 12 months. We now have 233 thousand fiber clients as of at present and retail broadband Web ARPU rose 8.4% year-over-year to achieve 116 shekels, one other improve of three shekels versus the earlier quarter. Pelephone continued to point out important enchancment, marking the sixth consecutive quarter with a year-over-year improve in service revenues. On the finish of Q3 2022, we reached a complete of two.68 million subscribers, of which 753 thousand are on 5G plans. For sure, web subscribers grew by 7,500, the perfect quarterly end result since 2014, bringing our complete new subscribers for the reason that starting of the 12 months to over 12

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Bezeq Q3 2022 Monetary Outcomes Transcript

Wednesday, November sixteenth, 2022

thousand. Within the third quarter, sure additionally launched the “triple” bundle to mix TV and Bezeq fiber, permitting it to handle new clients, cut back churn and leverage Bezeq’s superior infrastructure to enhance clients’ expertise.

We’re assured in our means to keep up good outcomes and stability, whereas nonetheless conserving ESG as a spotlight all through our decision-making course of. In instances of uncertainty within the international financial system and capital markets, Bezeq affords traders robust and stable monetary efficiency, spanning huge shopper and enterprise buyer bases, with sustainable demand for superior telecom providers, permitting us to generate robust money flows and shareholder returns supported by our dividend coverage. Now, let me flip the decision again to Tobi to debate our detailed monetary outcomes.

Tobi Fischbein

Thanks, Gil. Within the subsequent slide, we current the Group’s monetary highlights for the third quarter of the 12 months. Revenues within the third quarter of 2022 amounted to 2.26 billion shekels, up 5.6% year-over-year. Adjusted EBITDA elevated by 1% year-over-year to 947 million shekels. Adjusted web revenue rose 6.4% year-over-year to 314 million shekels in Q3, primarily resulting from decrease financing bills. Free Money Move for the quarter was decrease as a result of influence of timing variations in working capital in all group firms, primarily cost for frequencies, cost of salaries prematurely and timing of funds to the common fund and early retirement. We count on free money circulation to normalize within the coming intervals.

Turning to the subsequent slide, we skilled steady progress throughout the board for the nine- month interval, with revenues rising by 2.7% year-over-year to six.74 billion shekels pushed by enhancements in Mounted-Line and Pelephone. Adjusted EBITDA rose by 1% year-over-year to 2.83 billion shekels and Adjusted Internet Revenue elevated 5.3% year- over-year to 946 million shekels, each pushed by enhancements in Pelephone. Free Money Move on the finish of September 2022 was up 22.2% year-over-year to 959 million shekels.

The following slide reveals the Group’s key operational metrics for the previous 5 quarters. On the Subscribers aspect, we noticed will increase in TV, mobile and retail broadband subscribers as fiber take-up offset churn from our copper community. On ARPU, retail broadband Web grew 8.4% year-over-year, and mobile ARPU elevated 5.5% year-over-year. Telephony ARPU was down as a result of MOC tariff discount applied in Q2 2022.

Shifting to the subsequent slide, let me once more emphasize Bezeq’s monetary power and success in debt discount. As Gil beforehand stated, by the top of Q3 2022 our web debt decreased by 600 million shekels, or 10% year-over-year.

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Bezeq Q3 2022 Monetary Outcomes Transcript

Wednesday, November sixteenth, 2022

Shifting on to the subsequent slide – We want to reaffirm the steerage updates made in Q2 2022. Adjusted EBITDA is predicted to be within the vary of three.65 to three.75 billion shekels, Adjusted Internet Revenue between 1.1 to 1.2 billion shekels, and Capex is predicted to be between 1.7 to 1.8 billion shekels. We count on to achieve 1.5 million properties handed with fiber by the top of the 12 months. Now Ran will share with you updates on our Mounted Line operations.

Ran Guron

Thanks, Tobi. We completed one other robust quarter with report fiber connections of 51 thousand for a quarter-over-quarter improve of 32%. The variety of properties handed reached 1.48 million with 233 thousand fiber-connected clients as of at present. Complete revenues elevated 5% year-over-year primarily pushed by broadband Web and enterprise sector revenues. We achieved this robust efficiency regardless of the influence of the MOC telephony tariff discount in April 2022.

Shifting on to the subsequent slide, Adjusted EBITDA was up reasonably. Adjusted Internet Revenue rose by 3.8% year-over-year primarily resulting from diminished financing bills. Free Money Move was down resulting from timing variations in working capital. We count on free money circulation to normalize within the coming intervals.

Shifting to the subsequent slide, for the primary 9 months of the 12 months, Free Money Move was up 7.4% year-over-year, pushed by timing variations and improved working capital.

The next slide reveals our achievements in broadband Web that reached revenues of 452 million shekels for the quarter, representing an 11.1% year-over-year improve. Fiber subscriber ARPU elevated considerably by 8.4% year-over-year to achieve 116 shekels, and common broadband pace grew by almost 85% year-over-year, reaching 192 megabytes, which is one other report for us.

Shifting onto fiber optics on the subsequent slide. We proceed to deploy fiber nationwide and have elevated our give attention to buyer take-up for a report 51 thousand web provides in Q3. Clients with the Be Router reached 733 thousand by the top of this quarter, roughly 72% of our retail clients.

As proven within the subsequent slide, the enterprise sector continues to realize momentum with a 4.8% year-over-year income improve in transmission and information, in addition to 3.8% year- over-year progress in cloud and digital providers. Different revenues grew 33.3% year-over- 12 months to 80 million shekels as a result of Blue-Raman submarine cable challenge with Google, in addition to different infrastructure growth initiatives.

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Bezeq Q3 2022 Monetary Outcomes Transcript

Wednesday, November sixteenth, 2022

Shifting ahead to the subsequent slide, we detailed our bills and confirmed a slight wage improve resulting from worker recruitment associated to the fiber challenge. Working bills had been up within the quarter resulting from larger subcontractor and tools bills additionally associated to the fiber challenge.

Shifting to the subsequent slide, in abstract, our progress in broadband and within the enterprise sector have offset the unfavourable impacts attributable to the MOC telephony tariff, and the accelerated fiber deployment mixed with the rise in fiber clients has additional solidified our robust place in Israel. Our sturdy outcomes show our technique, and we proceed to be very assured in our progress potential transferring ahead. With that, I am going to now flip the decision to Ilan to speak about Bezeq’s subsidiaries.

Ilan Sigal

Thanks, Ran. I’m pleased to be again with the Bezeq Group throughout these very thrilling instances and searching ahead to main our subsidiaries in the direction of future progress.

Shifting to the subsequent slide, Pelephone posted robust outcomes with its sixth consecutive quarterly improve in service revenues pushed by a restoration in roaming revenues in addition to a rise in subscribers and 5G plans. As of at present, Pelephone has 753 thousand subscribers with 5G plans.

Within the subsequent slide, we will see that complete Pelephone income grew 12.4% year-over-year and reached 608 million shekels, the very best quarterly lead to three years. Adjusted EBITDA elevated 22.8% year-over-year to 205 million shekels, and Adjusted Internet Revenue grew 129% year-over-year to 55 million shekels.

Free Money Move is decrease for this quarter, with CapEx rising 130.9% year-over-year to 157 million shekels, of which roughly 88 million was resulting from a cost made to the MOC for frequencies. Many of the quantity paid will probably be credited to us within the fourth quarter of this 12 months.

Shifting to the subsequent slide, Free Money Move within the first 9 months of 2022 was up almost 530% year-over-year to 264 million shekels in comparison with 42 million within the corresponding interval final 12 months. This improve is principally attributed to timing variations associated to buyer debt assortment, in addition to improved profitability and dealing capital.

The graph displayed on the subsequent slide reveals the continued turnaround in service revenues over the past six quarters, showcasing the robust execution of our technique.

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Disclaimer

Bezeq The Israel Telecommunication Company Ltd. printed this content material on 24 November 2022 and is solely accountable for the knowledge contained therein. Distributed by Public, unedited and unaltered, on 24 November 2022 11:23:09 UTC.

Publicnow 2022

All information about BEZEQ THE ISRAEL TELECOMMUNICATION CORP. LTD

Gross sales 2022 9 022 M
2 641 M
2 641 M
Internet revenue 2022 1 187 M
348 M
348 M
Internet Debt 2022 5 555 M
1 626 M
1 626 M
P/E ratio 2022 15,0x
Yield 2022 3,21%
Capitalization 17 387 M
5 089 M
5 089 M
EV / Gross sales 2022 2,54x
EV / Gross sales 2023 2,51x
Nbr of Staff 5 475
Free-Float 73,2%

Chart BEZEQ THE ISRAEL TELECOMMUNICATION CORP. LTD



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Bezeq The Israel Telecommunication Corp. Ltd Technical Analysis Chart | MarketScreener

Technical evaluation developments BEZEQ THE ISRAEL TELECOMMUNICATION CORP. LTD

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Revenue Assertion Evolution

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Imply consensus BUY
Variety of Analysts 5
Final Shut Worth 6,29 ILS
Common goal value 6,94 ILS
Unfold / Common Goal 10,4%




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