RAMAT GAN, Israel, Aug. 4,
2016 /PRNewswire/ -- Internet Gold – Golden Lines Ltd.
(NASDAQ Global Select Market and TASE: IGLD) today reported its
financial results for the second quarter ended June 30, 2016. Internet Gold holds the
controlling interest in B Communications Ltd. (TASE and Nasdaq:
BCOM), which in turn holds the controlling interest in Bezeq, The
Israel Telecommunication Corp., Israel's largest telecommunications provider
(TASE: BEZQ).
Dividend from B Communications: On May 25, 2016, B Communications' board of
directors declared a cash dividend of NIS
355 million ($92 million), or
NIS 11.88 ($3.09) per share. Internet Gold received its
distributive share of approximately NIS 230
million ($60 million) on
June 29, 2016.
Cash and Debt Position: As of June
30, 2016, Internet Gold's unconsolidated liquidity
balance (comprised of cash and cash equivalents and short term
investments) totaled NIS 401 million
($104 million), its unconsolidated
total debt was NIS 946 million
($246 million) and its unconsolidated
net debt was NIS 545 million
($142 million).
Internet Gold's
Unconsolidated Balance Sheet Data
(1)
|
|
|
|
|
|
|
|
|
(In
millions)
|
|
|
Convenience
|
|
|
|
|
|
|
|
translation
into
|
|
|
|
|
|
|
|
U.S.
dollars
|
|
|
|
|
|
|
|
(Note
A)
|
|
|
|
|
|
June
30,
|
|
June
30,
|
|
June
30,
|
|
December
31,
|
|
2016
|
|
2016
|
|
2015
|
|
2015
|
|
NIS
|
|
US$
|
|
NIS
|
|
NIS
|
Short term
liabilities
|
151
|
|
39
|
|
215
|
|
153
|
Long term
liabilities
|
795
|
|
207
|
|
927
|
|
926
|
Total
debt
|
946
|
|
246
|
|
1,142
|
|
1,079
|
Liquidity
balance
|
401
|
|
104
|
|
335
|
|
277
|
Net
debt
|
545
|
|
142
|
|
807
|
|
802
|
|
|
|
|
|
|
|
|
(1) Does not include the consolidated balance
sheet of B Communications and its subsidiaries.
Internet Gold
Unconsolidated Sources and
Uses
|
|
|
|
|
(In
millions)
|
|
|
Convenience
|
|
|
|
translation
into
|
|
|
|
U.S.
dollars
|
|
|
|
(Note
A)
|
|
NIS
|
|
US$
|
|
|
|
|
Net debt as of December 31,
2015
|
802
|
|
209
|
|
|
|
|
Dividends received from B
Communications
|
(230)
|
|
(60)
|
Proceeds from the sale of B Communications
shares
|
(56)
|
|
(15)
|
Financial expenses,
net
|
26
|
|
7
|
Operating
expenses
|
3
|
|
1
|
|
|
|
|
Net debt as of June 30,
2016
|
545
|
|
142
|
Internet Gold's Cash Management: Internet Gold manages
its cash balances according to an investment policy that was
approved by its board of directors. The investment policy seeks to
preserve principal and maintain adequate liquidity while maximizing
the income received from investments without significantly
increasing the risk of loss. According to Internet Gold's
investment policy more than 80% of its funds must be invested in
investment-grade securities. As of today, 87% of the funds are
invested in investment-grade securities.
Internet Gold's Second Quarter Consolidated Financial
Results:
Internet Gold's consolidated revenues for the second quarter of
2016 totaled NIS 2.5 billion
($653 million), a 3.5% decrease
compared to the NIS 2.6 billion
reported in the second quarter of 2015. For both the current and
the prior-year periods, Internet Gold's consolidated revenues
consisted entirely of Bezeq's revenues.
Internet Gold's consolidated operating income for the second
quarter of 2016 totaled NIS 516
million ($134 million), a
15.5% decrease compared to NIS 611
million reported in the second quarter of 2015.
Internet Gold's consolidated net income for the second quarter
of 2016 totaled NIS 252 million
($66 million), a 5.4% increase
compared with NIS 239 million
reported in the second quarter of 2015.
Internet Gold's Second Quarter Unconsolidated Financial
Results:
As of June 30, 2016 Internet Gold
held approximately 65% of the outstanding shares of B
Communications. Internet Gold's interest in B Communications' net
income for the second quarter of 2016 totaled NIS 26 million ($7
million), compared with its share in B Communications' net
income of NIS 14 million in the
second quarter of 2015.
Internet Gold's unconsolidated net financial expenses for the
second quarter of 2016 totaled NIS 11
million ($3 million) compared
with NIS 26 million in the second
quarter of 2015. These expenses consist of interest and CPI linkage
expenses related to its publicly-traded debentures.
Internet Gold's net income attributable to shareholders for the
second quarter of 2016 totaled NIS 14
million ($4 million) compared
with a loss attributable to shareholders of NIS 13 million in the second quarter of 2015.
In
millions
|
|
|
Convenience
|
|
|
|
|
|
|
|
translation
|
|
|
|
|
|
|
|
into
|
|
|
|
|
|
|
|
U.S.
dollars
|
|
|
|
|
|
|
|
(Note
A)
|
|
|
|
|
|
Three-month
|
|
Three-month
|
|
Three-month
|
|
|
|
period
ended
|
|
period
ended
|
|
period
ended
|
|
Year
ended
|
|
June
30,
|
|
June
30,
|
|
June
30,
|
|
December
31,
|
|
2016
|
|
2016
|
|
2015
|
|
2015
|
|
NIS
|
|
US$
|
|
NIS
|
|
NIS
|
Revenues
|
-
|
|
-
|
|
-
|
|
-
|
Financial expenses,
net
|
(11)
|
|
(3)
|
|
(26)
|
|
(60)
|
Income tax
benefit
|
-
|
|
-
|
|
-
|
|
11
|
Operating
expenses
|
(1)
|
|
-
|
|
(1)
|
|
(4)
|
Interest in BCOM's net
income
|
26
|
|
7
|
|
14
|
|
140
|
Net income
(loss)
|
14
|
|
4
|
|
(13)
|
|
87
|
Commenting on the results, Doron
Turgeman, CEO of Internet Gold said, "The NIS 230 million dividend which we received from B
Communications on June 29, 2016
reduced our leverage level significantly with a
LTV1 ratio of 30% as of June 30, 2016. During the last 12 months we
succeeded in reducing Internet Gold's net debt by more than 32%
from NIS 807 million to NIS 545
million. We are very pleased with our improved metrics and
will continue to seek out additional ways to create value for our
shareholders."
Bezeq Group Results (Consolidated)
To provide further insight into its results, the Company is
providing the following summary of the consolidated financial
report of the Bezeq Group for the quarter ended June 30, 2016. For a full discussion of Bezeq's
results for the quarter ended June 30,
2016, please refer to its website:
http://ir.bezeq.co.il.
Bezeq Group
(consolidated)
|
Q2
2016
|
Q2
2015
|
%
change
|
|
(NIS
millions)
|
|
|
|
|
|
Revenues
|
2,511
|
2,603
|
(3.5%)
|
Operating
income
|
616
|
794
|
(22.4%)
|
Operating
margin
|
24.5%
|
30.5%
|
|
Net
income
|
377
|
482
|
(21.8%)
|
EBITDA
|
1,056
|
1,245
|
(15.2%)
|
EBITDA
margin
|
42.1%
|
47.8%
|
|
Diluted EPS
(NIS)
|
0.14
|
0.17
|
(17.6%)
|
Cash flow from operating
activities
|
870
|
840
|
3.6%
|
Payments for
investments
|
387
|
511
|
(24.3%)
|
Free cash flow
1
|
539
|
413
|
30.5%
|
Net
debt
|
9,254
|
9,543
|
(3.0%)
|
Net debt/EBITDA (end of
period)
2
|
2.24
|
2.30
|
|
|
|
|
|
1Free cash flow
is defined as cash flow from operating activities less net payments
for
investments.
|
2EBITDA in this
calculation refers to the trailing twelve
months.
|
Revenues of the Bezeq Group in the second quarter of 2016
were NIS 2.51 billion ($653 million) compared to NIS 2.60 billion in the corresponding quarter of
2015, a decrease of 3.5%. The decrease was due to lower revenues in
all of the Bezeq Group's segments (primarily at Pelephone).
Salary expenses of the Bezeq Group in the second quarter of 2016
were NIS 495 million ($128 million) compared to NIS 497 million in the corresponding quarter of
2015, a decrease of 0.4%.
Operating expenses of the Bezeq Group in the second quarter of
2016 were NIS 972 million
($253 million) compared to
NIS 1.00 billion in the corresponding
quarter of 2015, a decrease of 3.0%. The decrease was
primarily due to a reduction in interconnect payments to telecom
operators and lower building maintenance expenses.
Other operating income of the Bezeq Group in the second quarter
of 2016 amounted to NIS 12 million
($3 million), compared to
NIS 141 million in the corresponding
quarter of 2015. Other operating income was impacted by the
recording of capital gains from the sale of fixed assets in the
amount of NIS 148 million in the
second quarter of 2015.
Operating income of the Bezeq Group in the second quarter of
2016 was NIS 616 million
($160 million) (operating margin of
24.5%) compared to NIS 794 million
(operating margin of 30.5%) in the corresponding quarter of 2015, a
decrease of 22.4%.
Tax expenses of the Bezeq Group in the second quarter of 2016
were NIS 133 million ($35 million) compared to NIS 183 million in the corresponding quarter of
2015, a decrease of 27.3%. The decrease in tax expenses was
primarily due to a reduction in profit before tax as well as a
decrease in the corporate tax rate from 26.5% to 25% beginning on
January 1, 2016.
Net income of the Bezeq Group in the second quarter of 2016 was
NIS 377 million ($98 million) compared to NIS 482 million in the corresponding quarter of
2015, a decrease of 21.8%.
EBITDA of the Bezeq Group in the second quarter of 2016 was
NIS 1.06 billion ($275 million) (EBITDA margin of 42.1%) compared
to NIS 1.25 billion (EBITDA margin of
47.8%) in the corresponding quarter of 2015, a decrease of
15.2%.
Payments for investments (Capex) of the Bezeq Group in the
second quarter of 2016 were NIS 387
million ($101 million)
compared to NIS 511 million in the
corresponding quarter of 2015, a decrease of 24.3%. The decrease
was primarily due to the payment of NIS 96
million by Pelephone to the Ministry of Communication for
LTE 4G frequencies in the second quarter of 2015.
Cash flow from operating activities of the Bezeq Group in the
second quarter of 2016 was NIS 870
million ($226 million)
compared to NIS 840 million in the
corresponding quarter of 2015, an increase of 3.6%. The increase
was primarily due to an increase in working capital.
Free cash flow of the Bezeq Group in the second quarter of 2016
was NIS 539 million ($140 million) compared to NIS 413 million in the corresponding quarter of
2015, an increase of 30.5%.
Total debt of the Bezeq Group was NIS
11.5 billion ($3 billion) as
of June 30 2016 compared to
NIS 11.4 billion as of June 30, 2015. Net debt of the Bezeq Group was
NIS 9.25 billion ($2.41 billion) as of June
30, 2016 compared to NIS 9.54
billion as of June 30,
2015.
Notes:
A. Convenience
Translation to Dollars: For the convenience of the reader,
certain of the reported NIS figures as of June 30, 2016 have
been presented in millions of U.S. dollars, translated at the
representative rate of exchange as of June
30, 2016 (NIS 3.846 = U.S.
$1.00). The U.S. dollar ($) amounts
presented should not be construed as representing amounts
receivable or payable in U.S. dollars or convertible into U.S.
dollars, unless otherwise indicated.
B. Use of non-IFRS
Measurements: We and the Bezeq Group's management regularly use
supplemental non-IFRS financial measures internally to understand,
manage and evaluate its business and make operating decisions. We
believe these non-IFRS financial measures provide consistent and
comparable measures to help investors understand the Bezeq Group's
current and future operating cash flow performance. These non-IFRS
financial measures may differ materially from the non-IFRS
financial measures used by other companies.
In the press release and accompanying supplemental information,
we use the following non-IFRS financial measures: EBITDA, LTV, net
debt and free cash flow.
Management of the Company believes that free cash flow (defined
as net cash flow from operating activities, less net capital
expenditures) is an important measure of its liquidity as well as
its ability to service long-term debt, fund future growth and to
provide a return to shareholders. We also believe this free cash
flow definition does not have any material limitations.
The following non-IFRS measures are provided because management
believes these measurements are useful for investors and financial
institutions to analyze and compare companies on the basis of
operating performance:
- EBITDA - defined as net income plus net interest expense,
provision for income taxes, depreciation and amortization;
- Free Cash Flow (FCF) - defined as cash from operating
activities less cash for the purchase/sale of property, plant and
equipment, and intangible assets, net;
- Net debt - defined as long and short term liabilities minus
cash and cash equivalents and short term investments; and
- LTV (loan to value) - defined as the ratio of our
unconsolidated net debt to market value of the Company's holdings
in B Communications as of the balance sheet date.
Reconciliations between the Bezeq Group's results on an IFRS and
non-IFRS basis with respect to these non-IFRS measurements are
provided in tables immediately following the Company's consolidated
results. The non-IFRS financial measures are not meant to be
considered in isolation or as a substitute for comparable IFRS
measures, and should be read only in conjunction with its
consolidated financial statements prepared in accordance with
IFRS.
About Internet Gold
Internet Gold is a telecommunications-oriented holding company
which is a controlled subsidiary of Eurocom Communications Ltd.
Internet Gold's primary holding is its controlling interest in B
Communications Ltd. (TASE and Nasdaq: BCOM), which in turn holds
the controlling interest in Bezeq, The Israel Telecommunication
Corp., Israel's largest
telecommunications provider (TASE: BEZQ). Internet Gold's shares
are traded on NASDAQ and the TASE under the symbol IGLD. For more
information, please visit the following Internet sites:
www.igld.com
www.bcommunications.co.il
http://ir.bezeq.co.il/
Forward-Looking Statements
This press release contains forward-looking statements that are
subject to risks and uncertainties. Factors that could cause
actual results to differ materially from these forward-looking
statements include, but are not limited to, general business
conditions in the industry, changes in the regulatory and legal
compliance environments, the failure to manage growth and other
risks detailed from time to time in B Communications' filings with
the Securities Exchange Commission. These documents contain
and identify other important factors that could cause actual
results to differ materially from those contained in our
projections or forward-looking statements. Stockholders and
other readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date on
which they are made. We undertake no obligation to update publicly
or revise any forward-looking statement.
Internet Gold – Golden
Lines
Ltd.
|
|
Condensed Consolidated
Statements of Financial Position as
at
|
|
|
|
|
|
|
|
|
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Convenience
|
|
|
|
|
|
|
|
|
translation
into
|
|
|
|
|
|
|
|
|
U.S.
dollars
|
|
|
|
|
|
|
|
|
(Note
A)
|
|
|
|
|
|
|
June
30,
|
|
June
30,
|
|
June
30,
|
|
December
31,
|
|
|
2016
|
|
2016
|
|
2015
|
|
2015
|
|
|
NIS
|
|
US$
|
|
NIS
|
|
NIS
|
Assets
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
1,595
|
|
415
|
|
904
|
|
619
|
Restricted
cash
|
|
658
|
|
171
|
|
29
|
|
155
|
Investments
|
|
1,747
|
|
454
|
|
2,192
|
|
1,774
|
Trade receivables,
net
|
|
2,029
|
|
528
|
|
2,256
|
|
2,058
|
Other
receivables
|
|
239
|
|
62
|
|
244
|
|
286
|
Inventory
|
|
109
|
|
28
|
|
96
|
|
115
|
|
|
|
|
|
|
|
|
|
Total current
assets
|
|
6,377
|
|
1,658
|
|
5,721
|
|
5,007
|
|
|
|
|
|
|
|
|
|
Long-term trade and other
receivables
|
|
647
|
|
168
|
|
656
|
|
674
|
Property, plant and
equipment
|
|
7,120
|
|
1,851
|
|
7,345
|
|
7,197
|
Intangible
assets
|
|
6,859
|
|
1,784
|
|
*7,419
|
|
7,118
|
Deferred expenses and
investments
|
|
636
|
|
165
|
|
537
|
|
643
|
Broadcasting
rights
|
|
455
|
|
118
|
|
471
|
|
25
|
Investment in equity-accounted
investee
|
|
21
|
|
6
|
|
28
|
|
456
|
Deferred tax
assets
|
|
1,099
|
|
286
|
|
*1,194
|
|
1,290
|
|
|
|
|
|
|
|
|
|
Total non-current
assets
|
|
16,837
|
|
4,378
|
|
17,650
|
|
17,403
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
23,214
|
|
6,036
|
|
23,371
|
|
22,410
|
* Reclassified
Internet Gold – Golden
Lines
Ltd.
|
|
|
|
|
|
|
|
|
|
Condensed Consolidated
Statements of Financial Position as
at
|
|
|
|
|
|
|
|
|
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Convenience
|
|
|
|
|
|
|
|
|
translation
into
|
|
|
|
|
|
|
|
|
U.S.
dollars
|
|
|
|
|
|
|
|
|
(Note
A)
|
|
|
|
|
|
|
June
30,
|
|
June
30,
|
|
June
30,
|
|
December
31,
|
|
|
2016
|
|
2016
|
|
2015
|
|
2015
|
|
|
NIS
|
|
US$
|
|
NIS
|
|
NIS
|
Liabilities
|
|
|
|
|
|
|
|
|
Bank loans and credit and
debentures
|
|
2,314
|
|
602
|
|
2,301
|
|
2,219
|
Trade and other
payables
|
|
1,627
|
|
423
|
|
1,839
|
|
1,717
|
Related
party
|
|
208
|
|
54
|
|
*217
|
|
233
|
Current tax
liabilities
|
|
698
|
|
182
|
|
777
|
|
705
|
Provisions
|
|
90
|
|
23
|
|
90
|
|
100
|
Employee
benefits
|
|
370
|
|
96
|
|
272
|
|
378
|
Total current
liabilities
|
|
5,307
|
|
1,380
|
|
5,496
|
|
5,352
|
|
|
|
|
|
|
|
|
|
Bank loans and
debentures
|
|
13,511
|
|
3,513
|
|
13,817
|
|
13,215
|
Employee
benefits
|
|
239
|
|
62
|
|
238
|
|
240
|
Other
liabilities
|
|
252
|
|
66
|
|
208
|
|
227
|
Provisions
|
|
46
|
|
12
|
|
69
|
|
46
|
Deferred tax
liabilities
|
|
667
|
|
173
|
|
805
|
|
729
|
Total non-current
liabilities
|
|
14,715
|
|
3,826
|
|
15,137
|
|
14,457
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
20,022
|
|
5,206
|
|
20,633
|
|
19,809
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
Total equity attributable to
equity
|
|
|
|
|
|
|
|
|
holders of the
Company
|
|
379
|
|
99
|
|
(159)
|
|
(93)
|
Non-controlling
interests
|
|
2,813
|
|
731
|
|
2,897
|
|
2,694
|
|
|
|
|
|
|
|
|
|
Total
equity
|
|
3,192
|
|
830
|
|
2,738
|
|
2,601
|
|
|
|
|
|
|
|
|
|
Total liabilities and
equity
|
|
23,214
|
|
6,036
|
|
23,371
|
|
22,410
|
* Reclassified
Internet Gold – Golden
Lines
Ltd.
|
|
|
|
|
|
|
|
|
|
|
Condensed Consolidated
Statements of Income as
at
|
|
|
|
|
|
|
|
|
|
|
(In million except per
share
data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year
ended
|
|
Six months period ended June
30,
|
|
Three months period ended June
30,
|
|
December
31,
|
|
|
|
Convenience
|
|
|
|
|
|
Convenience
|
|
|
|
|
|
|
|
translation
|
|
|
|
|
|
translation
|
|
|
|
|
|
|
|
into
|
|
|
|
|
|
into
|
|
|
|
|
|
|
|
U.S.
dollars
|
|
|
|
|
|
U.S.
dollars
|
|
|
|
|
|
|
|
(Note
A)
|
|
|
|
|
|
(Note
A)
|
|
|
|
|
|
2016
|
|
2016
|
|
2015
|
|
2016
|
|
2016
|
|
2015
|
|
2015
|
|
NIS
|
|
US$
|
|
NIS
|
|
NIS
|
|
US$
|
|
NIS
|
|
NIS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
5,070
|
|
1,318
|
|
4,777
|
|
2,511
|
|
653
|
|
2,603
|
|
9,985
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost and
expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
1,083
|
|
281
|
|
1,011
|
|
538
|
|
140
|
|
572
|
|
2,131
|
Salaries
|
1,008
|
|
262
|
|
938
|
|
494
|
|
129
|
|
498
|
|
1,960
|
General and operating
expenses
|
1,998
|
|
520
|
|
1,805
|
|
975
|
|
253
|
|
1,004
|
|
3,878
|
Other operating income (loss),
net
|
(7)
|
|
(2)
|
|
(93)
|
|
(12)
|
|
(3)
|
|
(82)
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,082
|
|
1,061
|
|
3,661
|
|
1,995
|
|
519
|
|
1,992
|
|
7,972
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
988
|
|
257
|
|
1,116
|
|
516
|
|
134
|
|
611
|
|
2,013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing expenses,
net
|
361
|
|
93
|
|
335
|
|
154
|
|
40
|
|
235
|
|
595
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income after
financing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
expenses,
net
|
627
|
|
164
|
|
781
|
|
362
|
|
94
|
|
376
|
|
1,418
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of income (loss)
in
|
|
|
|
|
|
|
|
|
|
|
|
|
|
equity-accounted
investee
|
(2)
|
|
(1)
|
|
16
|
|
(1)
|
|
*
|
|
-
|
|
12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
tax
|
625
|
|
163
|
|
797
|
|
361
|
|
94
|
|
376
|
|
1,430
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
tax
|
230
|
|
60
|
|
256
|
|
109
|
|
28
|
|
137
|
|
347
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income for the
period
|
395
|
|
103
|
|
541
|
|
252
|
|
66
|
|
239
|
|
1,083
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) attributable
to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Owners of the
company
|
(18)
|
|
(5)
|
|
15
|
|
14
|
|
4
|
|
(13)
|
|
87
|
Non-controlling
interests
|
413
|
|
108
|
|
526
|
|
238
|
|
62
|
|
252
|
|
996
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income for the
period
|
395
|
|
103
|
|
541
|
|
252
|
|
66
|
|
239
|
|
1,083
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss),
basic
|
(0.93)
|
|
(0.24)
|
|
0.82
|
|
0.72
|
|
0.19
|
|
(0.63)
|
|
3.97
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss),
diluted
|
(0.93)
|
|
(0.24)
|
|
0.77
|
|
0.72
|
|
0.19
|
|
(0.65)
|
|
3.90
|
* Represents an amount less than US$1.
Bezeq, The Israel
Telecommunication
Corp.
|
Reconciliation for
NON-IFRS
Measures
|
|
|
|
|
EBITDA
|
|
|
|
|
The following is a
reconciliation of the Bezeq Group's net income to
EBITDA:
|
|
|
|
|
(In
millions)
|
Three months period ended June
30,
|
|
|
|
Convenience
|
|
|
|
|
|
translation
|
|
|
|
|
|
into
|
|
|
|
|
|
U.S.
dollars
|
|
|
|
|
|
(Note
A)
|
|
|
|
2016
|
|
2016
|
|
2015
|
|
NIS
|
|
US$
|
|
NIS
|
|
|
|
|
|
|
Net
income
|
377
|
|
98
|
|
482
|
Income
tax
|
133
|
|
35
|
|
183
|
Share of loss in equity-accounted
investee
|
1
|
|
-
|
|
-
|
Financing expenses,
net
|
105
|
|
27
|
|
129
|
Depreciation and
amortization
|
440
|
|
115
|
|
451
|
|
|
|
|
|
|
EBITDA
|
1,056
|
|
275
|
|
1,245
|
|
|
|
|
|
|
The Bezeq Group defines EBITDA as net income before financial
income (expenses), net, impairment and other charges, expenses
recorded for stock compensation in accordance with IFRS 2, income
tax expenses and depreciation and amortization. We present the
Bezeq Group's EBITDA as a supplemental performance measure because
we believe that it facilitates operating performance comparisons
from period to period and company to company by backing out
potential differences caused by variations in capital structure,
tax positions (such as the impact of changes in effective tax rates
or net operating losses) and the age of, and depreciation expenses
associated with, fixed assets (affecting relative depreciation
expense).
EBITDA should not be considered in isolation or as a substitute
for net income or other statement of operations or cash flow data
prepared in accordance with IFRS as a measure of profitability or
liquidity. EBITDA does not take into account our debt service
requirements and other commitments, including capital expenditures,
and, accordingly, is not necessarily indicative of amounts that may
be available for discretionary uses. In addition, EBITDA, as
presented in this press release, may not be comparable to similarly
titled measures reported by other companies due to differences in
the way that these measures are calculated.
Bezeq, The Israel
Telecommunication
Corp.
|
Reconciliation for
NON-IFRS
Measures
|
|
|
|
|
Free Cash
Flow
|
|
|
|
|
|
|
|
The following table shows
the calculation of the Bezeq Group's free cash
flow:
|
|
|
|
|
(In
millions)
|
|
|
|
|
Three months period ended June
30,
|
|
|
|
Convenience
|
|
|
|
|
|
translation
|
|
|
|
|
|
into
|
|
|
|
|
|
U.S.
dollars
|
|
|
|
|
|
(Note
A)
|
|
|
|
2016
|
|
2016
|
|
2015
|
|
NIS
|
|
US$
|
|
NIS
|
|
|
|
|
|
|
Cash flow from operating
activities
|
870
|
|
226
|
|
840
|
Purchase of property, plant and
equipment
|
(317)
|
|
(82)
|
|
(363)
|
Investment in intangible assets and deferred
expenses
|
(70)
|
|
(18)
|
|
(148)
|
Proceeds from the sale of property, plant and
equipment
|
56
|
|
14
|
|
84
|
|
|
|
|
|
|
Free cash
flow
|
539
|
|
140
|
|
413
|
Free cash flow is a financial index which is not based on IFRS.
Free cash flow is defined as cash from operating activities less
cash for the purchase/sale of property, plant and equipment, and
intangible assets, net. The Company presents free cash flow as an
additional index for assessing its business results and cash flows
because the Company believes that free cash flow is an important
liquidity index that reflects cash resulting from ongoing
operations after cash investments in infrastructure and other fixed
and intangible assets.
Net Debt
The following table shows the calculation of the Bezeq Group's
Net Debt:
(In
millions)
|
As at June
30,
|
|
|
|
Convenience
|
|
|
|
|
|
translation
|
|
|
|
|
|
into
|
|
|
|
|
|
U.S.
dollars
|
|
|
|
|
|
(Note
A)
|
|
|
|
2016
|
|
2016
|
|
2015
|
|
NIS
|
|
US$
|
|
NIS
|
|
|
|
|
|
|
Non-current bank loans and
debentures
|
1,958
|
|
509
|
|
1,924
|
Short term bank loans and credit and
debentures
|
9,546
|
|
2,482
|
|
9,444
|
Cash and cash
equivalents
|
(1,338)
|
|
(348)
|
|
(826)
|
Investments
|
(912)
|
|
(237)
|
|
(999)
|
|
|
|
|
|
|
Net
debt
|
9,254
|
|
2,406
|
|
9,543
|
|
|
|
|
|
|
Net debt reflects long and short term liabilities minus cash and
cash equivalents and investments.
Designated Disclosure with Respect to the Company's Projected
Cash Flows
In connection with the issuance of the Series D Debentures in
2014, we undertook to comply with the "hybrid model disclosure
requirements" as determined by the Israeli Securities Authority and
as described in the prospectus governing our Series D
Debentures.
This model provides that in the event certain financial "warning
signs" exist, and for as long as they exist, we will be subject to
certain disclosure obligations towards the holders of our Series D
Debentures.
In examining the existence of warning signs as of June 30 2016, our board of directors noted that
our consolidated financial statements (unaudited) as well as our
separate internal (unpublished) unaudited financial information as
of and for the quarter ended June 30,
2016 reflect that we had a continuing negative cash flow
from operating activities of NIS 1
million for the second quarter of 2016.
The Israeli regulations provide that the existence of a
continuing negative cash flow from operating activities could be
deemed to be a "warning sign" unless our board of directors
determines that the possible "warning sign" does not reflect a
liquidity problem.
Such continuing negative cash flow from operating activities
results from the general operating expenses of the Company of
NIS 1 million for the second quarter
of 2016 and due to the fact that the Company, as a holding Company,
does not have any cash inflows from operating activities. Our main
source of cash inflows is generated from dividends or debt
issuances (both classified as cash flow from financing
activities).
Such continuing negative cash flow from operating activities
does not effect our liquidity in any manner. Our board of directors
reviewed our financial position, outstanding debt obligations and
our existing and anticipated cash resources and uses and determined
that the existence of the continuing negative cash flow from
operating activities, as mentioned above, does not reflect a
liquidity problem.
[1] LTV (loan to value) ratio is calculated as Internet Gold's
unconsolidated net debt to market value of its holdings in B
Communications as of June 30,
2016.
For further information, please contact:
Idit Cohen - IR
Manager
idit@igld.com / Tel: +972-3-924-0000
Investor relations contacts:
Hadas Friedman - Investor Relations
Hadas@km-ir.co.il / Tel: +972-3-516-7620
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/internet-gold-reports-its-financial-results-for-the-second-quarter-of-2016-300309153.html
SOURCE Internet Gold - Golden Lines Ltd.