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Cellcom Israel Announces Third Quarter 2015 ResultsNETANYA, Israel, Nov. 17, 2015 /PRNewswire/ -- Third Quarter 2015 Highlights (compared to third quarter of 2014):
Nir Sztern, the Company's Chief Executive Officer, added: "The third quarter of 2015 results reflect the continued fierce competition in the cellular market that is expected to continue, which effect is reflected in the erosion of revenues and profitability. However, we maintained a positive net income due to a decrease in operating expenses and successful efforts we have taken in other areas of operations of the Group. In the third quarter of 2015 also, the Company is experiencing success in the landline market despite the difficulties in the implementation of the reform posed by Bezeq, the incumbent landline operator. Cellcom Israel is leading the price revolution in the wholesale market thanks to our cheapest triple play offering in Israel, concluding the third quarter with approximately 70,000 wholesale customers. The Company continues to recruit customers to the TV services at a robust pace with approximately 50,000 households enjoying the new TV service of Israel – Cellcom tv. We continue to broaden our landline product offering and strengthening our value advantage to the customer by being the only group in the market currently offering a true triple play offering that combines TV services, internet infrastructure and provider and home telephony, all in one bill. The Company reported the signing of an agreement to purchase Golan Telecom, an Israeli cellular operator, which requires the approval of the Ministry of Telecommunications and the Anti-Trust Commissionaire. The purchase of Golan Telecom is another step in turning Cellcom Israel into a leading telecommunication group that provides high value at low prices to the Israeli consumer. We intend to keep Golan Telecom as an independent company and we promise all Golan Telecom customers that we will honor all their existing agreements. I would also like to thank the outstanding employees of Cellcom Group, who have been making every effort to provide quality service to our customers. Without them we would not have reached these achievements." Shlomi Fruhling, Chief Financial Officer, commented: "In the third quarter of 2015 we continued the growth trend which began in the previous quarter in the landline market, through the continuation of recruiting customers to Cellcom tv, wholesale market services and triple play. However, in the cellular market we still experience aggressive competition which is reflected in the continued erosion in revenues from services, though at a slower pace than what we have witnessed during the first two quarters of the year. These impacts, and the positive seasonality effects from roaming services abroad, resulted in a slight increase in service revenues in the third quarter of 2015 compared with the prior quarter. We expect that the competition level will remain high in the coming quarters. As such, the Group is committed and continues to adjust its cost structure and investments to the market conditions. In the third quarter of 2015, selling and marketing, management and general expenses of the Group declined by 9.3% compared to the third quarter of last year, and the investment in fixed assets reached NIS 73 million, a 41% decrease compared to the third quarter of last year. The Group also continued in the third quarter to reduce its net debt, which at the end of the third quarter reached NIS 2.87 billion compared with a net debt of NIS 3.12 billion at the end of the third quarter of last year. The Company's free cash flow in the third quarter of 2015 reached NIS 127 million, a 58.1% decrease from the same quarter last year. Most of the decrease is due to a decline in proceeds from customers from service revenues, including proceeds from national roaming, as well as a decrease in proceeds from handsets sold in previous years. The Company's board of directors decided not to distribute a dividend for the third quarter of 2015, given the intensified competition and its adverse effect on the Company's revenues, and in order to strengthen the Company's balance sheet. The board of directors will re-evaluate its decision in future quarters in light of market developments and the Company needs." Cellcom Israel Ltd. (NYSE: CEL TASE: CEL) ("Cellcom Israel" or the "Company" or the "Group"), announced today its financial results for the third quarter of 2015. Revenues for the third quarter of 2015 totaled NIS 1,032 million ($263 million); EBITDA for the third quarter of 2015 totaled NIS 235 million ($60 million), which is 22.8% of total revenues; and net income for the third quarter of 2015 totaled NIS 40 million ($10 million). Basic earnings per share for the third quarter of 2015 totaled NIS 0.40 ($0.10). Main Consolidated Financial Results:
Main Financial Data by Operating Segments:
(*) Cellcom Israel Ltd. and its subsidiaries, excluding Netvision Ltd. and its subsidiaries. (**) Netvision Ltd. and its subsidiaries. (***) Include elimination of inter-company revenues between Cellcom Israel and Netvision, and amortization expenses attributable to the merger. Main Performance Indicators (data refers to cellular subscribers only):
Financial Review Revenues for the third quarter of 2015 decreased 9.6% totaling NIS 1,032 million ($263 million), compared to NIS 1,142 million ($291 million) in the third quarter last year. The decrease in revenues is attributed to a 10.3% decrease in service revenues, which totaled NIS 789 million ($201 million) in the third quarter of 2015 as compared to NIS 880 million ($224 million) in the third quarter last year. This decrease is added to a 7.3% decrease in equipment revenues, which totaled NIS 243 million ($62 million) in the third quarter of 2015 as compared to NIS 262 million ($67 million) in the third quarter of 2014. Netvision's contribution to revenues for the third quarter of 2015 totaled NIS 199 million ($51 million) (excluding inter-company revenues) compared to NIS 212 million ($54 million) in the third quarter of 2014. The decrease in third quarter 2015 service revenues resulted mainly from a decrease in cellular services revenues, due to the ongoing erosion in the price of these services as a result of the intensified competition in the cellular market. Netvision's contribution to service revenues for the third quarter of 2015 totaled NIS 171 million ($44 million) (excluding inter-company revenues) compared to NIS 200 million ($51 million) in the third quarter of 2014, resulted mainly from a decrease in revenues from ISP and international calls. The decrease in third quarter 2015 equipment revenues resulted mainly from an approximately 22% decrease in the number of handsets sold during the third quarter of 2015 as compared with the third quarter of 2014. This decrease was partially offset by an increase in Netvision's end-user equipment sales. Netvision's contribution to equipment revenues for the third quarter of 2015 totaled NIS 28 million ($7 million), compared to NIS 12 million ($3 million) in the third quarter of 2014. Cost of revenues for the third quarter of 2015 totaled NIS 671 million ($171 million), compared to NIS 660 million ($168 million) in the third quarter of 2014, a 1.7% increase. This increase resulted mainly due to a one-time positive effect regarding a reduction of a provision for cell-sites rent expenses in the amount of NIS 44 million ($11 million) in the third quarter of 2014, which was partially offset by a decrease in direct costs as a result of a reduction in equipment revenues, a decrease in depreciation and amortization expenses and efficiency measures implemented by the Company. Gross profit for the third quarter of 2015 totaled NIS 361 million ($92 million) compared to NIS 482 million ($123 million) in the third quarter of 2014, a 25.1% decrease. Gross profit margin for the third quarter of 2015 amounted to 35.0%, down from 42.2% in the third quarter of 2014. Selling, Marketing, General and Administrative Expenses ("SG&A Expenses") for the third quarter of 2015 decreased 8.3% to NIS 265 million ($68 million), compared to NIS 289 million ($74 million) in the third quarter of 2014. This decrease is primarily the result of the efficiency measures implemented by the Company, which led to a decrease in advertising, payroll expenses, rent, depreciation and amortization and other expenses. Operating income for the third quarter of 2015 decreased 49.5% to NIS 96 million ($24 million) from NIS 190 million ($48 million) in the third quarter of 2014. Operating income for the third quarter of 2015 was mainly affected by a decrease in revenues due to the ongoing erosion in service revenues and a one-time positive effect regarding a reduction of a provision for cell-sites rent expenses in the amount of NIS 44 million in the third quarter of 2014, partially offset by a decrease in operating expenses mainly due to efficiency measures implemented by the Company. EBITDA for the third quarter of 2015 decreased 32.1% totaling NIS 235 million ($60 million), compared to NIS 346 million ($88 million) in the third quarter of 2014. EBITDA for the third quarter of 2015, as a percent of third quarter revenues, totaled 22.8%, down from 30.3% in the third quarter of 2014. EBITDA for the third quarter of 2015, compared to EBITDA for the third quarter of 2014, excluding the one-time effect described above, which totaled NIS 302 million ($77 million), decreased by 22.2%. Excluding the one-time effect in the third quarter 2014, EBITDA for the third quarter of 2015, as a percent of third quarter revenues, decreased by 13.6% compared to the third quarter of 2014. Netvision's contribution to the EBITDA for the third quarter of 2015 totaled NIS 53 million ($14 million), compared to NIS 78 million ($20 million) in the third quarter of 2014, a 32.1% decrease, resulted mainly from a decrease in ISP and international calls revenues. Financing expenses, net for the third quarter of 2015 decreased 3.9% and totaled NIS 49 million ($12 million), compared to NIS 51 million ($13 million) in the third quarter of 2014. The decrease resulted mainly from a decrease in interest expenses in relation to the Company's debentures, as a result of a decrease in the Company's debt level, which was partially offset with losses from hedging transactions on the Israeli Consumer Price Index and losses in the Company's investment portfolio. Taxes on income for the third quarter of 2015 totaled NIS 7 million ($2 million), compared to NIS 33 million ($8 million) in the third quarter of 2014. The decrease is mainly attributed to the decrease in profit before tax. Net Income for the third quarter of 2015 totaled NIS 40 million ($10 million), compared to NIS 106 million ($27 million) in the third quarter of 2014, a 62.3% decrease. This decrease is mainly due to the continued erosion in cellular service revenues resulting from the intensified competition in the cellular market that was partially offset by a decrease in operational expenses. Basic earnings per share for the third quarter of 2015 totaled NIS 0.40 ($0.10), compared to NIS 1.06 ($0.27) in the third quarter of last year. Operating Review (data refers to cellular subscribers only) Cellular subscriber base – at the end of September 2015 the Company had approximately 2.832 million cellular subscribers. During the third quarter of 2015 the Company's cellular subscriber base decreased by approximately 16,000 net cellular subscribers, all pre-paid subscribers. Cellular Churn Rate for the third quarter of 2015 totaled 10.1%, compared to 11.0% in the third quarter of 2014. The cellular churn rate was primarily affected by the continued intensified competition in the cellular market. The monthly cellular Average Revenue per User ("ARPU") for the third quarter of 2015 totaled NIS 66.0 ($16.8), compared to NIS 70.6 ($18) in the third quarter of 2014. The decrease in ARPU resulted from the ongoing erosion in the price of cellular services, resulting from the intensified competition in the cellular market. Financing and Investment Review Cash Flow Free cash flow for the third quarter of 2015, decreased by 58.1% to NIS 127 million ($32 million), compared to NIS 303 million ($77 million) in the third quarter of 2014. The decrease in free cash flow in the third quarter of 2015 compared with the third quarter of 2014 was mainly due to a decrease in proceeds from customers due to the decrease in service revenues (including proceeds from national roaming revenues), as well as a decrease in proceeds from handsets sold in previous years. Total Equity Total Equity as of September 30, 2015 amounted to NIS 1,171 million ($298 million), primarily consisting of accumulated undistributed retained earnings of the Company. Investments in Fixed Assets and Intangible Assets During the third quarter of 2015, the Company invested NIS 73 million ($19 million) in fixed assets and intangible assets (including, among others, the continued investment in the cellular network and in software and TV set-top boxes), compared to NIS 123 million ($31 million) in the third quarter of 2014. Dividend On November 16, 2015, the Company's board of directors decided not to declare a cash dividend for the third quarter of 2015. In making its decision, the board of directors considered the Company's dividend policy and business status and decided not to distribute a dividend at this time, given the intensified competition and its adverse effect on the Company's revenues, and in order to strengthen the Company's balance sheet. The board of directors will re-evaluate its decision in future quarters. No future dividend declaration is guaranteed and is subject to the Company's board of directors' sole discretion, as detailed in the Company's annual report for the year ended December 31, 2014 on Form 20-F, under "Item 8 - Financial Information – A. Consolidated Statements and Other Financial Information - Dividend Policy". Debentures For information regarding the Company's summary of financial liabilities and details regarding the Company's outstanding debentures as of September 30, 2015, see "Disclosure for Debenture Holders" section in this press release. OTHER DEVELOPMENTS DURING THE THIRD QUARTER OF 2015 AND SUBSEQUENT TO THE END OF THE REPORTING PERIOD. Agreement for the Purchase of Golan Telecom In November 2015, the Company entered an agreement (the "Agreement") with Golan Telecom Ltd., or Golan, and its shareholders for the purchase of 100% of the shares of Golan, an Israeli cellular operator, for the sum of NIS 1.17 billion ("Purchase Price"). Golan is one of the four other Mobile Network Operators ("MNO") operating in Israel in addition to Cellcom Israel. It launched operations in 2012 with a strong brand recognized for low-cost services, and primarily provides cellular services to approximately 900,000 customers (as of November 2015), with a comparatively low churn. Golan is expected to end 2015 with total revenues exceeding NIS 500 million3. The Purchase Price represents an Enterprise Value, or EV4 of NIS 1 billion for Golan and EV/Adjusted EBITDA multiple of approximately 5.0, based on Golan's forecasted Adjusted EBITDA for 2015 (NIS 204 million)5. Transaction Details The main provisions of the Agreement include:
The Company intends to finance the Purchase Price through a combination of equity and debt. We expect that in addition to the said NIS 400 million convertible note, we would issue approximately NIS 200 million of equity (which may include the previously reported rights offering) and will finance the remainder from internal sources and a debt raising. Before approving the transaction, our Board of Directors considered, among others, external opinions by external financial consultants regarding Golan's valuation and the Company's ability to fulfill its liabilities, including its liabilities towards its debentures holders and lenders, after the consummation of the Transaction and concluded that the Transaction is for the benefit of the Company and there is no reasonable concern that following the consummation of the Transaction the Company shall not be able to fulfill its liabilities, including towards its debenture holders and lenders. See the Company's presentation describing Golan's key performance parameters and description of the contemplated transaction, filed on Form 6-K dated November 5, 2015. Selected Golan financial information
*EBITDA - Operating income before depreciation, amortization and other expenses **Total assets and liabilities figures as of 31.12.2014 and 30.6.2015 respectively. No figures available for 31.12.2013. Total liabilities exclude the previously reported national roaming difference accrued for the relevant periods. Golan's financial and operational information included in this press release was prepared by Golan and provided to the Company as part of Golan's representations in the Agreement. Golan's financial information included in this press release was prepared by Golan in accordance with Israeli GAAP. Israeli GAAP differs from IFRS, and the differences could be material. The Company has not reviewed this information and takes no responsibility for it. There is no assurance that the Agreement shall be approved by the Israeli regulators, which the Company estimates to be challenging, nor as to the execution of such a sale. The Company can provide no assurances as to the impact of this sale of holdings in Golan on the competitive environment in the market. This press release is not an offer of securities, and no securities may be offered or sold in the United States and Israel absent registration or an exemption from registration. Any public offering of securities by Cellcom to be made in the United States would only be made by means of a prospectus that may be obtained from Cellcom at the time of any such offering that will contain detailed information about the company and management, as well as financial statements. Any rights offering would be registered in the United States. For details regarding the Company's announcement of its intention to review such possible transaction see the Company's current report on Form 6-K, dated August 27, 2015. For additional details regarding the Company's agreements with Golan Telecom Ltd. and the competitive environment in which we operate see the Company's most recent annual report for the year ended December 31, 2014 on Form 20-F, filed on March 16, 2015, or 2014 annual report, under "Item 3. Key Information – D. Risk Factors – Risks Related to our Business –"We face intense competition in all aspects of our business" and "Item 4. Information on the Company – B. Business Overview – Network and Technology - Network and Cell Sites Sharing Agreements", "Competition – Cellular" and "Government Regulation – Network Sharing" and "- Additional MNOs" and the Company's current report regarding the Company's results of operations in the second quarter of 2015, on form 6-K, dated August 13, 2015 under "Other Developments During the First Quarter of 2015 and Subsequent to the End of the Reporting Period – Network Sharing Agreements". For details of Golan's operating environment and risks related thereto see the 2014 annual report under "Item 3. Key Information – D. Risk Factors – Risks Related to our Business" and "Item 4. Information on the Company – B. Business Overview –Competition" which includes, inter alia, general information describing the market in which both the Company and Golan operate. Forward looking statement The information included in this press release contains, or may be deemed to contain, forward-looking statements (as defined in the U.S. Private Securities Litigation Reform Act of 1995 and the Israeli Securities Law, 1968). Said forward-looking statements, relating to the purchase of Golan Telecom, our financing plans in connection therewith and the anticipated impact that the acquisition will have on our company are subject to uncertainties and assumptions, including the risk factors contained in our Form 20-F as well as: the receipt of the regulators' approvals to a sale of Golan; market conditions and their effect on Golan's results of operation and the impact of such a sale on the market; capital market conditions, which could impact our financing plans. The actual conditions the Company may face could lead to materially different outcome than that set forth above. Loan Agreement In August 2015, the Company entered into a loan agreement with an Israeli bank, or Lender, according to which the Lender has agreed, subject to certain customary conditions, to provide the Company a deferred loan in a principal amount of NIS 140 million, unlinked, which will be provided to the Company in December 2016, and will bear an annual fixed interest of 4.9%. The loan's principal amount will be payable in five equal annual payments on June 30 of each of the years 2018 through 2022 (inclusive). Under the Agreement, the interest rate may be subject to certain adjustments. Until the provision of the loan, the Company is required to pay the Lender a commitment fee and if it doesn't take the loan – certain agreed compensation. The Company may take the loan earlier, in which case the repayment shall be earlier and can prepay the loan, subject to a prepayment fee. The agreement also includes certain events which if not approved by the Lender allow the Lender to notify the Company of an acceleration of the repayment of the loan. The agreement includes standard terms and obligations and also generally includes the negative pledge, limitations on distributions, financial covenants and event of defaults applicable to the Company's series F through I debentures, with certain modifications, including foreclosure, materialization of a pledge, execution actions, receivership and (subject to certain exclusions) sale of assets, in a specified certain lower amount, a failure to operate in a field which is material to the Company's operations and mergers and changes of formation (with more limited exclusions) will trigger an event of default. In case the Company provides stricter financial covenants to another financial institution or debenture holder, those will apply to this agreement as well. For additional details regarding the Company's public debentures and existing loan agreement see 2014 Annual Report under "Item 5B. Liquidity and Capital Resources – Debt Service – Public debentures" and the Company's current report regarding the Company's results of operation in the first quarter of 2015, on form 6-K, dated May 14, 2015 under "Other Developments During the First Quarter of 2015 and Subsequent to the End of the Reporting Period – Loan Agreement". Controlling shareholder Following previous reports regarding changes in the control of the Company and disputes between the controlling shareholders of IDB Development Corporation Ltd., or IDB (the Company's indirect controlling shareholder), IDB announced in October 2015 that a company controlled by Mr. Eduardo Elsztain purchased all of IDB shares held by C.A.A. Extra Holdings Ltd. , that as a result C.A.A. Extra Holdings Ltd. and Mr. Mordechay Ben-Moshe are no longer controlling shareholders of IDB, and that companies controlled by Mr. Eduardo Elsztain hold now approximately 80.7% of IDB's share capital (up from 61.5%). The Company is discussing with the Ministry of Communications, or MOC, updates to its previous request to the MOC (which has not been granted yet) to approve the changes in the control in the Company, which also includes a request to amend the Company's licenses in relation to the Israeli holding requirement set therein. For additional details regarding the share ownership in the Company see the Company's proxy statement for the Company's 2015 annual shareholders meeting included in current report on Form 6-K, dated August 17, 2015, under "- Share Ownership". For additional details regarding the Israeli holding requirement see 2014 Annual Report under B. Risk Factors – "Item 3. Key Information – D. Risk Factors – Risks Related to our Business - There are certain restrictions in our licenses relating to the ownership of our shares" and "Item 4 - information on the company –B.Business Overview – Government Regulation – Our principal license". Unified license In September 2015, the Ministry of Communications granted the Company's subsidiaries unified licenses, allowing the provision of landline communications services, international telecommunication services and internet connectivity services, as the case may be. The unified license replaces the specific licenses. The provisions of our cellular license generally apply to the unified license. For additional details see 2014 Annual Report under "Item 4 - information on the company – B. Business Overview – Our principal license" and " - Government Regulation – Other Licenses – Unified License." 2015 Share Incentive Plan In August 2015, the Company's annual shareholder meeting approved the previously reported option grant to the Company's CEO, Mr. Nir Sztern. For additional details please see the Company's most recent annual report for the year ended December 31, 2014 on Form 20-F, filed on March 16, 2015, or 2014 Annual Report, under "Item 6. Directors, Senior Management and Employees – E. Share Ownership – 2015 Share Incentive Plan", and the Company current report regarding its results of operations in the second quarter of 2015, on Form 6-K, dated August 13, 2015 under "Other developments during the second quarter of 2015 and subsequent to the end of the reporting period - 2015 Share Incentive Plan". Conference Call Details The Company will be hosting a conference call on Tuesday, November 17, 2015 at 09:00 am ET, 06:00 am PT, 14:00 UK time, 16:00 Israel time. On the call, management will review and discuss the results for the third quarter of 2015, and will be available to answer questions. To participate, please either access the live webcast on the Company's website, or call one of the following teleconferencing numbers below. Please begin placing your calls at least 10 minutes before the conference call commences. If you are unable to connect using the toll-free numbers, please try the international dial-in number.
To access the live webcast of the conference call, please access the investor relations section of Cellcom Israel's website: http://investors.ircellcom.co.il. After the call, a replay of the call will be available under the same investor relations section. About Cellcom Israel Cellcom Israel Ltd., established in 1994, is the largest Israeli cellular provider; Cellcom Israel provides its approximately 2.832 million subscribers (as at September 30, 2015) with a broad range of value added services including cellular and landline telephony, roaming services for tourists in Israel and for its subscribers abroad and additional services in the areas of music, video, mobile office etc., based on Cellcom Israel's technologically advanced infrastructure. In addition, at the end of 2014, the Company launched television services over the internet (Over the top TV or OTT TV). The Company operates an LTE 4 generation network (currently partially deployed) and an HSPA 3.5 Generation network enabling advanced high speed broadband multimedia services, in addition to GSM/GPRS/EDGE networks. Cellcom Israel offers Israel's broadest and largest customer service infrastructure including telephone customer service centers, retail stores, and service and sale centers, distributed nationwide. Through its broad customer service network Cellcom Israel offers technical support, account information, direct to the door parcel delivery services, internet and fax services, dedicated centers for hearing impaired, etc. Cellcom Israel further provides through its wholly owned subsidiaries internet connectivity services and international calling services, as well as landline telephone communication services in Israel, in addition to data communication services. Cellcom Israel's shares are traded both on the New York Stock Exchange (CEL) and the Tel Aviv Stock Exchange (CEL). For additional information please visit the Company's website www.cellcom.co.il. Forward-Looking Statements The following information contains, or may be deemed to contain forward-looking statements (as defined in the U.S. Private Securities Litigation Reform Act of 1995 and the Israeli Securities Law, 1968). In some cases, you can identify these statements by forward-looking words such as "may," "might," "will," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential" or "continue," the negative of these terms and other comparable terminology. These forward-looking statements, which are subject to risks, uncertainties and assumptions about the Company, may include projections of the Company's future financial results, its anticipated growth strategies and anticipated trends in its business. These statements are only predictions based on the Company's current expectations and projections about future events. There are important factors that could cause the Company's actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements. Factors that could cause such differences include, but are not limited to: changes to the terms of the Company's license, new legislation or decisions by the regulator affecting the Company's operations, new competition and changes in the competitive environment, the outcome of legal proceedings to which the Company is a party, particularly class action lawsuits, the Company's ability to maintain or obtain permits to construct and operate cell sites, and other risks and uncertainties detailed from time to time in the Company's filings with the U.S. Securities and Exchange Commission, including under the caption "Risk Factors" in its Annual Report for the year ended December 31, 2014. Although the Company believes the expectations reflected in the forward-looking statements contained herein are reasonable, it cannot guarantee future results, level of activity, performance or achievements. Moreover, neither the Company nor any other person assumes responsibility for the accuracy and completeness of any of these forward-looking statements. The Company assumes no duty to update any of these forward-looking statements after the date hereof to conform its prior statements to actual results or revised expectations, except as otherwise required by law. The Company prepares its financial statements in accordance with International Financial Reporting Standards (IFRS), as issued by the International Accounting Standards Board (IASB). Unless noted specifically otherwise, the dollar denominated figures were converted to US$ using a convenience translation based on the New Israeli Shekel (NIS)/US$ exchange rate of NIS 3.923 = US$ 1 as published by the Bank of Israel for September 30, 2015. Use of non-IFRS financial measures EBITDA is a non-IFRS measure and is defined as income before financing income (expenses), net; other income (expenses), net; income tax; depreciation and amortization and share based payments. This is an accepted measure in the communications industry. The Company presents this measure as an additional performance measure as the Company believes that it enables us to compare operating performance between periods and companies, net of any potential differences which may result from differences in capital structure, taxes, age of fixed assets and related depreciation expenses. EBITDA should not be considered in isolation, or as a substitute for operating income, any other performance measures, or cash flow data, which were prepared in accordance with Generally Accepted Accounting Principles as measures of profitability or liquidity. EBITDA does not take into account debt service requirements, or other commitments, including capital expenditures, and therefore, does not necessarily indicate the amounts that may be available for the Company's use. In addition, EBITDA as presented by the Company may not be comparable to similarly titled measures reported by other companies, due to differences in the way these measures are calculated. See the reconciliation of net income to EBITDA under "Reconciliation for Non-IFRS Measures" below. Free cash flow is a non-IFRS measure and is defined as the net cash provided by operating activities (including the effect of exchange rate fluctuations on cash and cash equivalents), minus the net cash used in investing activities excluding short-term investment in tradable debentures and deposits and proceeds from sales of such debentures (including interest received in relation to such debentures) and deposits.
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To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/cellcom-israel-announces-third-quarter-2015-results-300179862.html SOURCE Cellcom Israel Ltd. |