RAMAT GAN, Israel, Nov. 30,
2017 /PRNewswire/ -- Internet Gold - Golden Lines Ltd. ("the
Company") (NASDAQ Global Select Market and TASE: IGLD) today
reported its financial results for the third quarter of 2017.
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 Corporation Ltd.
(TASE: BEZQ).
"During October 2017, we succeeded
in extending the average duration of our outstanding debt by
entering into various debenture exchange transactions and reduced
the total payment due during 2018 to only NIS 144 million ($41
million). We are very pleased with the results of both B
Communications and Bezeq and feel very comfortable with our debt
and equity positions," said Doron
Turgeman, CEO of Internet Gold.
Private placement of Series D Debentures: During
October 2017, the Company
conducted two private placements of approximately NIS 227 million par value of its Series D
Debentures to certain institutional, "qualified" and private
investors in Israel in exchange
for approximately NIS 205 million par
value of its outstanding Series C Debentures. Upon completion of
the exchange offer, an aggregate principal amount of NIS 40.5 million par value of Series C Debentures
and NIS 757.3 million par value of
Series D Debentures remain outstanding.
Debt and Liquidity Balances
As of September 30,
2017, Internet Gold's unconsolidated liquidity balances
comprised of cash and cash equivalents and short-term investments
totaled NIS 197 million ($56 million), its unconsolidated total debt was
NIS 798 million ($226 million) and its unconsolidated net debt was
NIS 601 million ($170 million).
(In
millions)
|
September
30,
|
September
30,
|
September
30,
|
December
31,
|
|
2017
|
2017
|
2016
|
2016
|
|
NIS
|
US$
|
NIS
|
NIS
|
|
|
|
|
|
Series C
debentures
|
257
|
73
|
384
|
389
|
Series D
debentures
|
541
|
153
|
546
|
551
|
CPI
forward
|
-
|
-
|
6
|
6
|
Total debt
|
798
|
226
|
936
|
946
|
|
|
|
|
|
Cash and cash
equivalents
|
20
|
6
|
64
|
48
|
Short-term
investments
|
177
|
50
|
313
|
334
|
Total
liquidity
|
197
|
56
|
377
|
382
|
|
|
|
|
|
Net debt
|
601
|
170
|
559
|
564
|
|
|
|
|
|
Internet Gold's Third Quarter Consolidated Financial
Results
Internet Gold's consolidated revenues for the third quarter of
2017 totaled NIS 2.42 billion
($683 million), a 3.8% decrease
compared to the NIS 2.51 billion
reported in the third quarter of 2016. 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 profit for the third
quarter of 2017 totaled NIS 419
million ($118 million), a
14.0% decrease compared with NIS 487
million reported in the third quarter of 2016.
Internet Gold's consolidated net profit for the third quarter of
2017 totaled NIS 201 million
($57 million) compared with a net
loss of NIS 41 million reported in
the third quarter of 2016. The loss in the third quarter of 2016
was due to one-time refinancing expenses recorded by B
Communications related to the early redemption of its 7⅜% Senior
Secured Notes ("Notes").
Internet Gold's net profit attributable to shareholders for the
third quarter of 2017 totaled NIS 18
million ($5 million) compared
with a net loss of NIS 180 million
for the third quarter of 2016.
Internet Gold's Third Quarter Unconsolidated Financial
Results
(In
millions)
|
Three months ended
September 30,
|
|
Year ended
December 31,
|
|
2017
|
2017
|
2016
|
|
2016
|
|
NIS
|
US$
|
NIS
|
|
NIS
|
|
|
|
|
|
|
Financial expenses,
net
|
(6)
|
(2)
|
(13)
|
|
(44)
|
Operating
expenses
|
(1)
|
-
|
(1)
|
|
(5)
|
Interest in BCOM's
net profit (loss)
|
25
|
7
|
(166)
|
|
(153)
|
Net profit
(loss)
|
18
|
5
|
(180)
|
|
(202)
|
As of September 30, 2017, Internet
Gold held approximately 65% of B Communications' outstanding
shares. Accordingly, Internet Gold's interest in B Communications'
net profit for the third quarter of 2017 totaled NIS 25 million ($7
million) compared with a net loss of NIS 166 million in the third quarter of 2016. The
loss in the third quarter of 2016 was due to one-time refinancing
expenses recorded by B Communications related to the early
redemption of the Notes.
Internet Gold's unconsolidated net financial expenses in the
third quarter of 2017 totaled NIS 6
million ($2 million) compared
with NIS 13 million in the third
quarter of 2016. These expenses consist of NIS 10 million ($3
million) of interest and CPI linkage expenses related to its
publicly-traded debentures. These expenses were partially offset by
financial income of NIS 4 million
($1 million) generated by short term
investments.
Internet Gold's unconsolidated net profit for the third quarter
of 2017 totaled NIS 18 million
($5 million) compared with a net loss
of NIS 180 million for the third
quarter of 2016.
The 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 third quarter ended September 30, 2017. For a full discussion of
Bezeq's results for the third quarter ended September 30, 2017, please refer to its website:
http://ir.bezeq.co.il.
Bezeq Group
(consolidated)
|
Q3-2017
|
Q3-2016
|
%
change
|
|
(NIS
millions)
|
|
|
|
|
|
Revenues
|
2,415
|
2,510
|
(3.8%)
|
Operating
profit
|
544
|
599
|
(9.2%)
|
Operating
margin
|
22.5%
|
23.9%
|
|
Net profit
|
322
|
394
|
(18.3%)
|
EBITDA
|
980
|
1,041
|
(5.9%)
|
EBITDA
margin
|
40.6%
|
41.5%
|
|
Diluted EPS
(NIS)
|
0.12
|
0.14
|
(14.3%)
|
Cash flow from
operating activities
|
982
|
902
|
8.9%
|
Payments for
investments
|
353
|
349
|
1.1%
|
Free cash flow
1
|
677
|
577
|
17.3%
|
Total debt
|
11,533
|
11,246
|
2.6%
|
Net debt
|
8,968
|
9,400
|
(4.6%)
|
EBITDA (trailing
twelve months)
|
3,911
|
4,067
|
(3.8%)
|
Net debt/EBITDA (end
of period) 2
|
2.29
|
2.31
|
|
|
|
|
|
1 Free
cash flow is defined as cash flow from operating activities less
net payments for investments.
|
2
EBITDA in this calculation refers to the trailing twelve
months.
|
Revenues of the Bezeq Group in the third quarter of 2017 were
NIS 2.42 billion ($683 million) compared to NIS 2.51 billion in the corresponding quarter of
2016, a decrease of 3.8%. The decrease was due to lower revenues in
all group segments.
Salary expenses of the Bezeq Group in the third quarter of 2017
were NIS 502 million ($142 million) compared to NIS 501 million in the corresponding quarter of
2016.
Operating expenses of the Bezeq Group in the third quarter of
2017 were NIS 956 million
($271 million) compared to
NIS 994 million in the corresponding
quarter of 2016, a decrease of 3.8%. The decrease in operating
expenses was due to a reduction in the operating expenses of the
various Group subsidiaries, which was influenced by the early
adoption of accounting standard IFRS 15.
Other operating income, net of the Bezeq Group in the third
quarter of 2017 amounted to NIS 23
million ($7 million) compared
to NIS 26 million in the
corresponding quarter of 2016. The decrease in other operating
income was due to a NIS 11 million
($3 million) fine imposed by the
Ministry of Communications as well as an increase in the provision
for legal claims, partially offset by an increase in capital gains
from the sale of real estate by Bezeq Fixed-Line.
Depreciation and amortization expenses of the Bezeq Group in the
third quarter of 2017 were NIS 436
million ($124 million)
compared to NIS 442 million in the
corresponding quarter of 2016, a decrease of 1.4%. The decrease in
depreciation expenses was due to a reduction in the amortization
expenses related to the purchase price allocation recorded in
connection with the increase in its ownership interest in Yes,
partially offset by an increase in depreciation expenses in the
cellular segment due to the early adoption of accounting standard
IFRS 15.
Operating profit of the Bezeq Group in the third quarter of 2017
was NIS 544 million ($154 million) compared to NIS 599 million in the corresponding quarter of
2016, a decrease of 9.2%.
Financing expenses, net of the Bezeq Group in the third quarter
of 2017 amounted to NIS 94 million
($27 million) compared to
NIS 104 million in the corresponding
quarter of 2016, a decrease of 9.6%. The decrease in financing
expenses was primarily due lower expenses at Yes partially offset
by an update in the estimated fair value of advanced payments made
by the Bezeq Group to Eurocom DBS of NIS 13
million ($4 million).
Tax expenses of the Bezeq Group in the third quarter of 2017
were NIS 128 million ($36 million) compared to NIS 99 million in the corresponding quarter of
2016, an increase of 29.3%. The increase in tax expenses was due a
decrease in tax expenses in the third quarter of 2016 as a result
of tax adjustments in respect of prior years at Bezeq
Fixed-Line.
Net profit of the Bezeq Group in the third quarter of 2017 was
NIS 322 million ($91 million) compared to NIS 394 million in the corresponding quarter of
2016, a decrease of 18.3%. The decrease in net profit was due to
the aforementioned reduction in revenues and increase in tax
expenses.
EBITDA of the Bezeq Group in the third quarter of 2017 was
NIS 980 million ($278 million) (EBITDA margin of 40.6%) compared
to NIS 1.04 billion (EBITDA margin of
41.5%) in the corresponding quarter of 2016, a decrease of
5.9%.
Cash flow from operating activities of the Bezeq Group in the
third quarter of 2017 was NIS 982
million ($278 million)
compared to NIS 902 million in the
corresponding quarter of 2016, an increase of 8.9%. The increase in
cash flow from operating activities was due to changes in working
capital.
Payments for investments (Capex) of the Bezeq Group in the third
quarter of 2017 was NIS 353 million
($100 million) compared to
NIS 349 million in the corresponding
quarter of 2016.
Free cash flow of the Bezeq Group in the third quarter of 2017
was NIS 677 million ($192 million) compared to NIS 577 million in the corresponding quarter of
2016, an increase of 17.3%. The increase in free cash flow was due
to the aforementioned increase in cash flow from operating
activities as well as an increase in proceeds from the sale of real
estate due to timing differences.
Total debt of the Bezeq Group as of September 30, 2017 was NIS
11.5 billion ($3.3 billion)
compared to NIS 11.2 billion as of
September 30, 2016.
Net debt of the Bezeq Group as of September 30, 2017 was NIS
9.0 billion ($2.54 billion)
compared to NIS 9.4 billion as of
September 30, 2016.
Net debt to EBITDA (trailing twelve months) ratio of the Bezeq
Group as of September 30, 2017, was
2.29, compared to 2.31 as of September 30,
2016.
ISA Investigation: The Company has been reporting the
events concerning the investigation by the Israel Securities
Authority ("ISA") relating to alleged improprieties surrounding the
YES -Bezeq transaction and the transaction between YES and Space
Communication Ltd. As reported, the investigation appears to focus
on Bezeq's 2015 acquisition of the remaining ownership interest in
its satellite TV unit, YES, from its then parent company, Eurocom
DBS. Following initial reports concerning the investigation, civil
claims with motions to certify the claims as class action lawsuits
were filed in Israel against the
Company, Bezeq and others. The Company is currently evaluating the
claims and its course of action.
On November 6, 2017, the
Securities Authority issued a press release indicating the
conclusion of the Investigation and the transfer of the
investigation file to the Tel Aviv
District Attorney's Office (Taxation and Economics). The District
Attorney's Office is authorized to decide on further action at
their discretion.
Notes:
Convenience translation to U.S Dollars
Unless noted specifically otherwise, the dollar denominated
figures were converted to US$ using a convenience translation based
on the New Israeli Shekel (NIS)/US$ exchange rate of NIS 3.529 = US$ 1
as published by the Bank of Israel
for September 30, 2017.
Use of non-IFRS financial measures
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. The following
non-IFRS measures are provided in the press release and
accompanying supplemental information because management believes
these measurements provide consistent and comparable measures to
help investors understand the Bezeq Group's current and future
operating cash flow performance and are useful for investors and
financial institutions to analyze and compare companies on the
basis of operating performance:
- EBITDA - defined as net profit plus income tax expenses, share
of loss in equity accounted investee, net financing expenses and
depreciation and amortization;
- EBITDA trailing twelve months - defined as net profit plus
income tax expenses, share of loss in equity accounted investee,
net financing expenses and depreciation and amortization
during last twelve months;
- Net debt - defined as long and short term bank loans and
debentures minus cash and cash equivalents and short term
investments;
- Net debt to EBITDA ratio - defined as net debt divided by the
trailing twelve months EBITDA;
- Free Cash Flow (FCF) - defined as cash from operating
activities less cash used for the purchase/sale of property, plant
and equipment, and intangible assets, net.
These non-IFRS financial measures may differ materially from the
non-IFRS financial measures used by other companies.
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 profit 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.
Management of Bezeq believes that free cash flow 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. 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.
Bezeq also uses net debt and the net debt to EBITDA trailing
twelve months ratio to analyze its financial capacity for further
leverage and in analyzing the company's business and financial
condition. Net debt reflects long and short term liabilities minus
cash and cash equivalents and investments.
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
www.eurocom.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.
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
Internet Gold - Golden Lines Ltd.
Condensed Consolidated Statements of Financial Position as
at
(In millions)
|
September
30,
|
September
30,
|
September
30,
|
December
31,
|
|
2017
|
2017
|
2016
|
2016
|
|
NIS
|
US$
|
NIS
|
NIS
|
Current
assets
|
|
|
|
|
Cash and cash
equivalents
|
2,562
|
725
|
1,012
|
810
|
Investments
|
562
|
159
|
1,483
|
1,240
|
Trade receivables,
net
|
1,948
|
552
|
1,998
|
2,000
|
Other
receivables
|
294
|
83
|
228
|
217
|
Related
party
|
43
|
13
|
-
|
-
|
Inventory
|
101
|
29
|
96
|
106
|
Total current
assets
|
5,510
|
1,561
|
4,817
|
4,373
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
Trade and other
receivables
|
520
|
148
|
641
|
644
|
Property, plant and
equipment
|
6,974
|
1,976
|
7,042
|
7,072
|
Intangible
assets
|
6,102
|
1,729
|
6,724
|
6,534
|
Deferred expenses and
investments
|
557
|
158
|
483
|
465
|
Broadcasting
rights
|
457
|
129
|
450
|
432
|
Deferred tax
assets
|
1,014
|
287
|
1,103
|
1,007
|
Total non-current
assets
|
15,624
|
4,427
|
16,443
|
16,154
|
|
|
|
|
|
Total
assets
|
21,134
|
5,988
|
21,260
|
20,527
|
Internet Gold - Golden Lines Ltd.
Condensed Consolidated Statements of Financial Position as
at
(In millions)
|
September
30,
|
September
30,
|
September
30,
|
December
31,
|
|
2017
|
2017
|
2016
|
2016
|
|
NIS
|
US$
|
NIS
|
NIS
|
Current
liabilities
|
|
|
|
|
Bank loans and credit
and debentures
|
963
|
273
|
2,491
|
2,181
|
Trade and other
payables
|
1,833
|
519
|
1,611
|
1,661
|
Related
party
|
-
|
-
|
6
|
32
|
Dividend
payable
|
522
|
148
|
490
|
-
|
Current tax
liabilities
|
125
|
35
|
223
|
138
|
Provisions
|
94
|
27
|
87
|
80
|
Employee
benefits
|
251
|
71
|
280
|
315
|
Total current
liabilities
|
3,788
|
1,073
|
5,188
|
4,407
|
|
|
|
|
|
Non-current
liabilities
|
|
|
|
|
Bank loans and
debentures
|
13,800
|
3,909
|
12,226
|
12,241
|
Employee
benefits
|
260
|
74
|
237
|
258
|
Other
liabilities
|
292
|
83
|
257
|
244
|
Provisions
|
48
|
14
|
47
|
47
|
Deferred tax
liabilities
|
516
|
146
|
645
|
593
|
Total non-current
liabilities
|
14,916
|
4,226
|
13,412
|
13,383
|
|
|
|
|
|
Total
liabilities
|
18,704
|
5,299
|
18,600
|
17,790
|
|
|
|
|
|
Equity
|
|
|
|
|
Attributable to
shareholders of the Company
|
233
|
66
|
198
|
194
|
Non-controlling
interests
|
2,197
|
623
|
2,462
|
2,543
|
Total
equity
|
2,430
|
689
|
2,660
|
2,737
|
|
|
|
|
|
Total liabilities and
equity
|
21,134
|
5,988
|
21,260
|
20,527
|
Internet
Gold - Golden Lines Ltd.
Condensed Consolidated Statements of Income for the
(In millions, except per share data)
|
Nine months period
ended September 30,
|
Three months
period ended September 30,
|
Year ended
December 31,
|
|
2017
|
2017
|
2016
|
2017
|
2017
|
2016
|
2016
|
|
NIS
|
US$
|
NIS
|
NIS
|
US$
|
NIS
|
NIS
|
|
|
|
|
|
|
|
|
Revenues
|
7,331
|
2,077
|
7,580
|
2,415
|
683
|
2,510
|
10,084
|
|
|
|
|
|
|
|
|
Costs and
expenses
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
1,590
|
451
|
1,622
|
537
|
152
|
539
|
2,161
|
Salaries
|
1,500
|
425
|
1,509
|
502
|
142
|
501
|
2,017
|
General and operating
expenses
|
2,897
|
821
|
2,995
|
959
|
272
|
997
|
4,024
|
Other operating
expenses
|
|
|
|
|
|
|
|
(income),
net
|
(1)
|
-
|
(21)
|
(2)
|
(1)
|
(14)
|
21
|
|
|
|
|
|
|
|
|
|
5,986
|
1,697
|
6,105
|
1,996
|
565
|
2,023
|
8,223
|
|
|
|
|
|
|
|
|
Operating
profit
|
1,345
|
380
|
1,475
|
419
|
118
|
487
|
1,861
|
|
|
|
|
|
|
|
|
Financing expenses,
net
|
407
|
115
|
816
|
119
|
33
|
455
|
975
|
|
|
|
|
|
|
|
|
Profit after
financing
|
|
|
|
|
|
|
|
expenses,
net
|
938
|
265
|
659
|
300
|
85
|
32
|
886
|
|
|
|
|
|
|
|
|
Share of loss
in
|
|
|
|
|
|
|
|
equity-accounted investee
|
4
|
1
|
4
|
-
|
-
|
2
|
5
|
|
|
|
|
|
|
|
|
Profit before income
tax
|
934
|
264
|
655
|
300
|
85
|
30
|
881
|
|
|
|
|
|
|
|
|
Income tax
expenses
|
273
|
77
|
301
|
99
|
28
|
71
|
442
|
|
|
|
|
|
|
|
|
Net profit (loss) for
the period
|
661
|
187
|
354
|
201
|
57
|
(41)
|
439
|
|
|
|
|
|
|
|
|
Profit (loss)
attributable to:
|
|
|
|
|
|
|
|
Shareholders of the
Company
|
42
|
12
|
(198)
|
18
|
5
|
(180)
|
(202)
|
Non-controlling
interests
|
619
|
175
|
552
|
183
|
52
|
139
|
641
|
|
|
|
|
|
|
|
|
Net profit (loss) for
the period
|
661
|
187
|
354
|
201
|
57
|
(41)
|
439
|
|
|
|
|
|
|
|
|
Earnings (loss) per
share
|
|
|
|
|
|
|
|
Basic
|
2.21
|
0.63
|
(10.37)
|
0.95
|
0.27
|
(9.43)
|
(10.52)
|
Diluted
|
2.21
|
0.63
|
(10.37)
|
0.95
|
0.27
|
(9.43)
|
(10.52)
|
Reconciliation for NON-IFRS Measures
EBITDA
The following is a reconciliation of the Bezeq Group's net
profit to EBITDA:
(In
millions)
|
Three month period
ended September 30,
|
Trailing twelve
months ended September 30,
|
|
2017
|
2017
|
2016
|
2017
|
2017
|
2016
|
|
NIS
|
US$
|
NIS
|
NIS
|
US$
|
NIS
|
|
|
|
|
|
|
|
Net profit
|
322
|
91
|
394
|
1,215
|
344
|
1,428
|
Income tax
expenses
|
128
|
36
|
99
|
562
|
159
|
534
|
Share of loss in
equity- accounted investee
|
-
|
-
|
2
|
5
|
1
|
7
|
Financing expenses,
net
|
94
|
27
|
104
|
433
|
123
|
308
|
Depreciation and
amortization
|
436
|
124
|
442
|
1,696
|
481
|
1,790
|
|
|
|
|
|
|
|
EBITDA
|
980
|
278
|
1,041
|
3,911
|
1,108
|
4,067
|
Net Debt
The following table shows the calculation of the Bezeq Group's
net debt:
(In
millions)
|
As at September
30,
|
|
2017
|
2017
|
2016
|
|
NIS
|
US$
|
NIS
|
|
|
|
|
Short term bank loans
and credit and debentures
|
555
|
157
|
2,135
|
Non-current bank
loans and debentures
|
10,978
|
3,110
|
9,111
|
Cash and cash
equivalents
|
(2,471)
|
(700)
|
(938)
|
Investments
|
(94)
|
(27)
|
(908)
|
|
|
|
|
Net
debt
|
8,968
|
2,540
|
9,400
|
Net Debt to Trailing Twelve Months EBITDA
Ratio
The following table shows the calculation of the Bezeq Group's
net debt to trailing twelve months EBITDA ratio:
(In
millions)
|
As at September
30,
|
|
2017
|
2017
|
2016
|
|
NIS
|
US$
|
NIS
|
|
|
|
|
Net
debt
|
8,968
|
2,540
|
9,400
|
|
|
|
|
Trailing twelve
months EBITDA
|
3,911
|
1,108
|
4,067
|
|
|
|
|
Net debt to EBITDA
ratio
|
2.29
|
2.29
|
2.31
|
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 month period
ended September 30,
|
|
2017
|
2017
|
2016
|
|
NIS
|
US$
|
NIS
|
|
|
|
|
Cash flow from
operating activities
|
982
|
278
|
902
|
Purchase of property,
plant and equipment
|
(255)
|
(72)
|
(290)
|
Investment in
intangible assets and deferred expenses
|
(98)
|
(28)
|
(59)
|
Proceeds from the
sale of property, plant and equipment
|
48
|
14
|
24
|
|
|
|
|
Free cash
flow
|
677
|
192
|
577
|
Loan to Value (LTV)
The following table shows the calculation of IGLD's loan to
value ratio:
(In
millions)
|
As at September
30,
|
|
2017
|
|
NIS
|
|
|
IGLD's unconsolidated
net debt
|
601
|
|
|
Market value of B
Communications shares held by IGLD
|
976
|
|
|
IGLD's LTV
|
61.6%
|
Net Asset Value (NAV)
The following table shows the calculation of IGLD's net asset
value:
(In
millions)
|
As at September
30,
|
|
2017
|
|
NIS
|
|
|
Market value of B
Communications shares held by IGLD
|
976
|
|
|
IGLD's unconsolidated
net debt
|
601
|
|
|
IGLD's NAV
|
375
|
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 September 30, 2017, 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 three months period ended September 30, 2017 reflect that we had a
continuing negative cash flow from operating activities of
NIS 1 million in the third quarter of
2017.
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 in the third quarter of
2017 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 (classified as
cash flow from investing activities) or debt issuances (classified
as cash flow from financing activities). We did not have any such
inflows in the third quarter of 2017.
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.
Internet Gold's Unconsolidated Balance Sheet
(In
millions)
|
September
30,
|
September
30,
|
September
30,
|
December
31,
|
|
2017
|
2017
|
2016
|
2016
|
|
NIS
|
US$
|
NIS
|
NIS
|
Current
assets
|
|
|
|
|
Cash and cash
equivalents
|
20
|
6
|
64
|
48
|
Short-term
investments
|
177
|
50
|
313
|
334
|
Total current
assets
|
197
|
56
|
377
|
382
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
Investment in an
investee (*)
|
834
|
236
|
757
|
758
|
|
|
|
|
|
Total
assets
|
1,031
|
292
|
1,134
|
1,140
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
Current maturities of
debentures
|
183
|
51
|
130
|
130
|
Other
payables
|
2
|
1
|
9
|
21
|
Total current
liabilities
|
185
|
52
|
139
|
151
|
|
|
|
|
|
Non-current
liabilities
|
|
|
|
|
Debentures
|
613
|
174
|
797
|
795
|
|
|
|
|
|
Total
liabilities
|
798
|
226
|
936
|
946
|
|
|
|
|
|
Total
equity
|
233
|
66
|
198
|
194
|
|
|
|
|
|
Total liabilities and
equity
|
1,031
|
292
|
1,134
|
1,140
|
(*) Investment in B Communications.
Unconsolidated figures as of September
30, 2017:
- Unconsolidated total equity represents 22.6% of unconsolidated
total balance sheet.
- Unconsolidated LTV ratio is 61.6%.
- The ratio of cash and cash equivalents plus short-term
investments plus dividend receivable from B Communication and
market value of B Communications shares over the control permit
(approximately 14.78% of B Communications outstanding shares) to
unconsolidated current maturities of debentures is 2.27.
- Internet Gold's NAV is NIS 375
million.
View original
content:http://www.prnewswire.com/news-releases/internet-gold-reports-its-financial-results-for-the-third-quarter-of-2017-300564281.html
SOURCE Internet Gold - Golden Lines Ltd.