Bezeq Israeli Telecommunication Co. Ltd. (TASE: BEZQ) mobile subsidiary Pelephone Communications Ltd. reported 14% revenue decline to NIS 1.24 billion for the first quarter from NIS 1.45 billion for the corresponding quarter, and net profit fell 30% to NIS 216 million from NIS 310 million.
Services revenue fell 12% to NIS 834 million for the first quarter from NIS 949 million for the corresponding quarter, although data, content services and value added services revenue rose 8.5% to NIS 307 million from NIS 283 million. Handset sales fell 18%, reversing a longstanding trend, to NIS 410 million from NIS 501 million.
Pelephone added 29,000 net new subscribers during the first quarter to reach 2.88 million at the end of March. However, Average revenue per user (ARPU) fell 12% to NIS 97 per month during the first quarter from NIS 110 per month during the corresponding quarter, although average monthly minutes of use per customer (MOU) rose 11% to 399 minutes from 359 million. The increase in MOU was due to the switch multi-minute and SMS packages, although this switch also lowered revenue.
Pelephone CEO Gil Sharon said, "Pelephone delivered good operating performance compared with the fourth quarter of 2011, although compared with the corresponding quarter, we clearly are feeling the effects of the regulatory changes and the new competition, which caused erosion in profitability."
Pelephone is the first of the three big mobile carriers to publish its financial report, and will be followed by Cellcom Israel Ltd. (NYSE:CEL; TASE:CEL) and Orange franchisee Partner Communications Ltd. (Nasdaq: PTNR; TASE: PTNR).
Published by Globes [online], Israel business news - www.globes-online.com - on May 9, 2012
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