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Safe harbor statementThis presentation includes forward-looking statements within the meaning of Section 27A of the US Securities Act of 1933, as amended, Section 21E of the
US Securities Exchange Act of 1934, as amended, and the safe harbor provisions of the US Private Securities Litigation Reform Act of 1995. Words such as
"estimate", “believe”, “anticipate”, “expect”, “intend”, “seek”, “will”, “plan”, “could”, “may”, “project”, “goal”, “target” and similar expressions often identify
forward-looking statements but are not the only way we identify these statements. Specific statements have been made regarding the Company’s intention
to deploy fiber optic network with a massive coverage of potential households in Israel within 3-4 years, to become a key player in the market by increasing
market share and to potentially share infrastructure CAPEX through cooperation and/or potential wholesale; the Company’s expectation for approximately 7
years payback period for the Company’s fiber optic network; the Company’s expectation for stability in CAPEX relating to the fiber optic network; the
Company’s expectation for television service potential ARPU growth through expansion of content packages and applications and the Company’s expected
level of indebtedness in the coming years; In addition, all statements other than statements of historical fact included in this press release regarding our
future performance are forward-looking statements. We have based these forward-looking statements on our current knowledge and our present beliefs
and expectations regarding possible future events. These forward-looking statements are subject to risks, uncertainties and assumptions, including, the
Company’s technical and financial ability to realize the anticipated benefits from the investment in the Company's fiber optic infrastructure and TV service in
light of competition and to increase profitability in the fixed-line segment and establish the Company as a leading communications infrastructure company;
as well as the Company’s ability to satisfy its financial and other covenants, and to meet future repayment schedules. Future results may differ materially
from those anticipated herein. For further information regarding risks, uncertainties and assumptions about Partner, trends in the Israeli telecommunications
industry in general, the impact of current global economic conditions and possible regulatory and legal developments, and other risks we face, see “Item 3.
Key Information - 3D. Risk Factors”, “Item 4. Information on the Company”, “Item 5. Operating and Financial Review and Prospects”, “Item 8. Financial
Information - 8A. Consolidated Financial Statements and Other Financial Information - 8A.1 Legal and Administrative Proceedings” and “Item 11. Quantitative
and Qualitative Disclosures about Market Risk” in the Company’s Annual Reports on Form 20-F filed with the SEC, as well as its immediate reports on Form 6-
K furnished to the SEC. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information,
future events or otherwise.
2
Partner Highlights� A leading Israeli communications group
� Saban Saban Saban Saban Capital Group Capital Group Capital Group Capital Group - Controlling shareholder since 2013
� More than 3 3 3 3 million connections million connections million connections million connections in all activities
� Fastest growing TV platform Fastest growing TV platform Fastest growing TV platform Fastest growing TV platform in Israel with 79K new subs in 2018 (184% annual growth), 140K in total to date and over 8% Market Share (MS) within 1.5 year
� Approx. 75% of TV subscribers are in bundle/triple offerings (broadband based)
� Fastest deployment Fastest deployment Fastest deployment Fastest deployment of Fiber Optic network in Israel–Over Over Over Over 350350350350K households reached K households reached K households reached K households reached –nearly 20202020% of% of% of% of
potential households in Israelpotential households in Israelpotential households in Israelpotential households in Israel–Intention to deploy F.O network with a massive coverage of potential Intention to deploy F.O network with a massive coverage of potential Intention to deploy F.O network with a massive coverage of potential Intention to deploy F.O network with a massive coverage of potential
households in Israel within households in Israel within households in Israel within households in Israel within 3333----4 4 4 4 yearsyearsyearsyears
� OPEX savings OPEX savings OPEX savings OPEX savings - replacing current wholesale infrastructures with our independent infrastructure
� Strong balance sheet with 1.3 1.3 1.3 1.3 net net net net debt/EBITDA debt/EBITDA debt/EBITDA debt/EBITDA ratio
4
Partner leading Israeli Telco group
Cellular 25% MS
Broadband and ISP operation
Business SolutionsLeading
service provider
Partner TV Over 8% MS
within 1.5 years
Partner FiberNearly 20%
fiber deployment
+350 Khouseholds reached*
140 K sub.*2,646 K sub.
More than 3 million connections in all activities
* As of March 27, 2019
5
Q4 2018 highlights*
* Changes vs. Q4 2017. See also Company’s annual PR for 2018.
** Notes payable and borrowings less cash & cash equivalents (incl. ST deposits) divided by Adjusted EBITDA for the last 4 quarters.
*** Includes M2M subscriptions on a standardized basis as from Q4 2018.
OPEX(NIS, M)
Net Debt/Adjusted EBITDA**
Cellular Post-Paid subscribers annual growth
TV subscribers annual growth
502 1.3
***K53 + +79 KFastest Growth in
the market
Lowest level among leading traded Israeli
telco groups
Cellular churn rate
8.5%
-1.4 ppt
Adjusted EBITDA (NIS, M)
172
March 27, 2019:Partner TV has Partner TV has Partner TV has Partner TV has 140,000
Subscribers & Partner Fiber Partner Fiber Partner Fiber Partner Fiber reaches over 350,000
households
Service Revenues (NIS, M)
625
Stable +9%
-3%
+2 ppt
21%
6
TOTALCOMMUNICATIONS
NEEDS
Comprehensive Solutions for businesses
Enabling the connected life anywhere, anytime and on any device
Meet the full spectrum of our customers’ communications needs
Customer Centric
At the forefront of innovation in the world of infrastructure and services
Making services and CS accessible using the most innovative tools
Be truly digital in how we think, act and collaborate
Monetize datathrough enhanced efficiency improvement of our current offering
Offering and creation of valuable new activities
Communication Group with a full offering to the Private & Business customer
Partner’s strategy
7
Partner's Cellular networkProviding the widest 4G deployment in the country(Based on benchmark data of Drive Test across Israel during 2018)
Over 2,900 sites, covering 99% of Israeli population
Preparing for 5G
Completion of cover and call continuityby WiFi calling
First to launch a VoLTE service
9
Network sharing agreement with HOT Mobile
Cost savingson the one hand
Key benefits
� Savings in CAPEX and OPEX
� Inherent hedging of OPEX with the growth of HOT Mobile
� Reduction in number of network sites
� Improved network coverage and capacity
� Optimal utilization of existing spectrum
…while enabling network differentiation as a result of separate core network
Examples
� IoT
network
� WiFi
calling
� VoLTE
10
* * * * ARPU for Q2 2018, excluding a one-time provision of NIS 15 million for a class action, is NIS 59
6562
58 59 58 5760
57
2016 2017 2018 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18
*
Cellular ARPU & Churn
40%38%
35%
9.9% 8.9%10.1%
8.0% 8.5%
2016 2017 2018 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18
Cellular churn (%) Cellular ARPU (NIS)
11
Over 50 top linear channels + Catch up
Innovative UI allowing quick and easy integration with 3rd party app content
Partnership with Netflix
Collaboration with Amazon Prime Video
Flexible content costs model
SVOD, TVOD offering with Israeli broadcasters and major studios
Fastest growing TV platform in Israel
12
* Annual change for 4 quarters ended Q3 2018
� Potential ARPU growth through expansion of content packages/apps
� Fastest pace of subscriber recruitment
� Innovative OTT technology among the world’s best
� Competitors will need to adjust technology – involves massive CAPEX spend
� Launched only in August 2017 and has already become a significant market player
13
Partner TV subscriber base (EOP, '000s)
14
43
65
83
106
122
140
Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Mar. 27, 2018
14
Fiber deployment: Aiming for the mass marketFiber deployment: Aiming for the mass marketFiber deployment: Aiming for the mass marketFiber deployment: Aiming for the mass market
Deployment throughout the country, starting with higher ROI areas
Speeds of up to 1 Gbps and as part of bundle offerings
Growth potential through an increase in market share to become a key player in the market
OPEX savings - replacing wholesale infr. with independent infr.
Potential infr. CAPEX sharing through cooperation and/or potential wholesale
Low deployment cost compared to other companies in the world
Approx. 75% of TV subscribers are in bundle/triple offerings (broadband based)
15
Partner's Fiber Optic network
Intention to deploy Fiber Optic network with a massive coverage of potential households in Israel within 3-4 years
CAPEX relating to Fiber Optic network expected to remain stable from 2018
Expected payback period of 7 years Fiber Optic network subscribers have much higher contribution margin than wholesale internet subscribers
16
Fiber deployment: Aiming for the mass marketFiber deployment: Aiming for the mass marketFiber deployment: Aiming for the mass marketFiber deployment: Aiming for the mass market
Partner's Fiber Optic network
Or YehudaOr AkivaAshdodAshkelonBe'er Ya'akovBeer ShevaBnei BrakBat YamGivat ShmuelGivatayimGanei TikvaHod HasharonHerzliyaHaderaHolonHaifaYavneYehud-MonossonYokne'am
JerusalemKfar SabaLodNess ZionaNesherPetah TikvaKiryat OnoKiryat AtaQiryat GatKiryat YamRosh HaAyinRishon LezionRamlaRamat GanRamat-HasharonRa'ananaTel Aviv- Jaffa
Presence over 50% of the
cities in Israel
Reached 350K households
within 1.5 years
Presence over 50% of the
cities in Israel
17
Integrated Hybrid SolutionsIntegrated Hybrid SolutionsIntegrated Hybrid SolutionsIntegrated Hybrid Solutions
Hosting IT Integration
Cellular IntegrationNetworking Security
International Communications
Wired Telephony
Partner's Business Solutions
18
Connected & Autonomous
Vehicles
Smart Home
Smart Cities
Industrial Automation
Smart Health
Tracking Devices
New Hobbies
Infrastructure & IoT ProMachines are the customers of the futureMachines are the customers of the futureMachines are the customers of the futureMachines are the customers of the future
19
Adjusted EBITDA and Adjusted FCFSignificant CAPEX outlay in new revenue engines of fiber optic network and TV in 2018
Adjusted EBITDA* & Adjusted EBITDA margin (NIS, million)
Adjusted Free Cash Flow (before interest) (NIS, million)
* Adjusted EBITDA figures from 2017 include impact of adoption of IFRS 15. For more details see the Company’s 20-F report.
**Adjusted EBITDA, Adjusted EBITDA margin and Adjusted Free cash flow are Non-GAAP financial measures. Please see “Use of Non-GAAP Financial Measures” in the quarterly PRs.
566
758
599
124 63-22
2015 2016 2017 2018 Q4'17 Q4'18
876 834 917 722
158 172
21%24%
28%
22%
19%21%
0%
5%
10%
15%
20%
25%
30%
35%
40%
-
500
1,000
1,500
2,000
2,500
2015 2016 2017 2018 Q4'17 Q4'18
Adjusted EBITDA Adjusted EBITDA margin
21
Net Debt decreased by ~ 38% in two years
Debt figures for year-end 2019 include a deferred issuance of Notes Series F in an amount of NIS 227 million in December 2019.
Repayment Schedule Notes & Loans a/o December 31, 2018 (NIS, million)
Debt/Net Debt (NIS, billion)
5.4 5.2
4.7
4.4
4.0
3.5 3.4 3.3 3.6
3.1 2.9
2.7
2.0 1.9
1.6 1.4
1.7
4.9 4.6
4.2
3.8
3.4
3.0 2.7 2.6 2.6
2.2 2.0
1.5
1.1 0.9 0.9 1.0
DEBT NET DEBT
22
1.21.0 1.0 1.1 1.2 1.3 1.3
Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18
Net Debt to Adjusted EBITDA*
*Notes payable and borrowings less cash & cash equivalents (incl. ST deposits) divided by Adjusted EBITDA for the last 4 quarters
23
Equipment Stable profit and quality sales
Equipment revenues and gross profit
204 201 177 168
189
40 43 37 44 42
20%21% 21%
26%
22%
0 %
5 %
10 %
15 %
2 0%
2 5%
-
2 0 0
4 0 0
Q4'17 Q1'18 Q2'18 Q3'18 Q4'18
% total revenues
NIS million
Equipment Revenues Equipment Gross Profit Equipment Gross Margin
24
Balance sheet a/o December 31, 2018AssetsAssetsAssetsAssets NIS million Liabilities and EquityLiabilities and EquityLiabilities and EquityLiabilities and Equity NIS million
Cash and cash equivalents & ST deposits 416 Current maturities of notes payable & borrowings 162
Trade receivables and other current assets 740 Trade payables 711
Inventories 98 Other current liabilities 277
Current AssetsCurrent AssetsCurrent AssetsCurrent Assets 1,2541,2541,2541,254 Current LiabilitiesCurrent LiabilitiesCurrent LiabilitiesCurrent Liabilities 1,1501,1501,1501,150
Trade receivables & other non-current assets 487 Long term notes payable & borrowings 1,204
Property and equipment 1,211 Other non-current liabilities 216
Goodwill 407 Non Current LiabilitiesNon Current LiabilitiesNon Current LiabilitiesNon Current Liabilities 1,4201,4201,4201,420
Intangible and other assets 617
Non Current AssetsNon Current AssetsNon Current AssetsNon Current Assets 2,7222,7222,7222,722 EquityEquityEquityEquity 1,4061,4061,4061,406
Total AssetsTotal AssetsTotal AssetsTotal Assets 3,9763,9763,9763,976 Total Liabilities and EquityTotal Liabilities and EquityTotal Liabilities and EquityTotal Liabilities and Equity 3,9763,9763,9763,976
25
Competitive Advantages
Cellular network with the widest deployment of LTE/LTE Advanced in Israel
Strong and experienced management team
Highest growth rate among TV operators in Israel in 2018
Lowest financial debt level and lowest net debt/EBITDA ratio of all the leading traded communication groups in Israel
Fastest deployment of fiber optic infrastructure in Israel – will enable OPEX savings - replacing current wholesale infrastructure charges
26
Partner’s strengths
First to offer roaming to customers in Israel, First to offer SMS in Israel, First to offer 3G & 4G in Israel, First to offer Wi-Fi Calling and VoLTE in Israel
Widest 4G coverage, leading customer service, network sharing agreement, more than 22 hundred kilometers of fiber optics
Transforming into a Total Telecommunications Group, diversified revenue sources from private and business customers, increasing digital operations, innovation
Partner serves over 3 millions connections - cellular subscribers, fixed-line households with broadband internet and ISP services and advanced TV services
InnovativeInnovativeInnovativeInnovative
DNADNADNADNA
BillingBillingBillingBilling
RelationsRelationsRelationsRelations
DefinedDefinedDefinedDefined
StrategyStrategyStrategyStrategy
StrongStrongStrongStrong
FoundationsFoundationsFoundationsFoundations
27
TamirTamirTamirTamir AmarAmarAmarAmar
CFO
+972 (54) 781 4951
Liat Glazer ShaftLiat Glazer ShaftLiat Glazer ShaftLiat Glazer Shaft
Head of Investor Relations & Corporate Projects
+972 (54) 781 5051
Investor website: Investor website: Investor website: Investor website:
www.partner.co.il/en/Investors-Relations/lobby
IR contacts