Bezeq The Israeli Telecommunications Corp LTD (BZQIY) Q1 2025 Highlights: …

Appearance date: May 20, 2025

You can find the complete copy of the earnings call in the complete earnings call.

• The core income rose by 2.4%due to the growth of the firm management and telephone services.

• The adjusted net income rose by 6.7%, which is due to a decline in asset disorders.

• A significant growth in strategic areas with an increase in fiber liabilities by 36% and growth of 18% in 5G subscribers.

• Successful completion of the reform of the copper network circuit, which will increase profitability.

• The continued fiber use with over 2.7 million houses and a recording rate of 33%.

• The Free Cashflow decreased in this quarter due to tax ratings and tax refund in the corresponding quarter.

• The salary costs rose due to salary increases and reduced reimbursement from national insurance.

• The adapted net profit in the telephone segment decreased by 8.3% due to higher depreciation and financial costs.

• The company missed consensus expectations, especially in the yes segment.

• The operating costs rose to the employees based on provisions for conditional grants.

Q: It seems that the income missed the consensus. Can you explain where the discrepancy comes from, especially with regard to yes? What are the plans for the rest of the year? A: (Unidiendified_2) The EBITDA values ​​were as expected, and we took a flat year before 2026. The universal find and higher spectrum fees influenced this year's EBITDA. Roaming gradually recovers and we feel confident about our instructions. Yes, a strong quarter with an increase in adjusted EBITDA had a 12%increase, and we expect further stability and growth of subscribers and arpu due to fiber commitments.

Q: The Internet Arpu rose by over 5%, but the internet revenue rose less than 1%. Can you explain this discrepancy? A: (Unidiendified_2) The arpu increase is due to the ongoing conversion of copper to fiber. However, there was a slight decline in the entire broadband subscribers in the fixed line business. The reduced passive rate in wholesale also influenced broadband revenue.

Q: What can we expect from the resolution of the MOC when removing the structural separation? Is there a chance that it will remain unchanged? A: (Unidiendified_2) We do not yet know the result, but the MOC announced that it will issue its solution in 2025. We are in a formal process with you and believe that it should be completely removed to enable a complete merger without restrictions. We will communicate more information as soon as available.

Q: Can you provide further details about the Copper Shutdown project and the potential effects? A: (Unidiendified_2) The reform of the copper circuit was not budgeted in our instructions because it was not final before this quarter. Now that it is final, we expect some Capex and Opex savings. We can complete copper in areas that are completely covered with fiber, which leads to energy savings and reduced maintenance costs.