Israeli Mobile Operator Cellcom Q2 Loss Narrows Despite Lawsuit Provision
Cellcom, Israel‘s largest mobile phone operator, reported a second-quarter loss despite a jump in revenue after it set aside a one-time provision due to a class action lawsuit against the company.
Cellcom, which de-listed from the New York Stock Exchange in February, said on Thursday it lost 14 million shekels ($4 million) in the quarter, versus a 46 million shekel loss a year earlier. Revenue rose 17.3% to 1 billion shekels.
It was forecast to lose 11 million shekels in the quarter, according to a Reuters poll of analysts.
The company reported a 32 million shekel provision due to a court ruling that it will have to repay customers who were overcharged. Cellcom said it plans to appeal the decision.
Like its peers, Cellcom has been pressured in recent years by intense competition in the mobile sector while the coronavirus pandemic hurt revenues from roaming services of customers traveling overseas as well as roaming services of tourists traveling to Israel.
As a result, Cellcom has sought other streams of revenue, such as providing fibre optic broadband and internet-based TV services.
Its number of internet customers was up 4.5% in the second quarter to 296,000 — 113,000 of those connected to its fibre network — while TV subscribers rose 2% to 250,000.
Mobile phone subscribers rose 18% to 3,226 million.