Cellcom Israel announced major reduction in its Opex and Capex as part of its restructuring exercise initiated by CEO Nir Sztern.
Cellcom Israel will reduce approximately NIS 150 million from current Opex by the end of 2020. Cellcom Israel will cut its expenses and payments to suppliers, reduce manpower and reduce landline wholesale access fees.
Cellcom Israel said it will slash job in its sale and service customer facing division during the current phase. Some media reports indicate that Cellcom will cut around 500 jobs in its telecom business.
Cellcom’s rival Pelephone Communications is laying off 400 people as part of its merger with parent company Bezeq Israeli Telecommunication.
Cellcom Israel will also reduce Capex to approximately NIS 450 – 500 million per annum, by the end of 2020.
Cellcom Israel will raise capital by approximately NIS 400 million.
Deloitte Israel is assisting the telecom operator for drafting the restructuring strategy in order to compete with rivals.
Cellcom Israel CEO Nir Sztern said: “The company intends to substantially reduce costs and decrease the debt, as market conditions continue to be challenging.”
Cellcom’s revenue totaled NIS 920 million in the second quarter against NIS 928 million in the first quarter and NIS 927 million in the fourth quarter of 2018.
Cellcom Israel reported NIS 35 million loss in Q2 2019, following a NIS 15 million loss in the preceding quarter and NIS 35 million loss in the fourth quarter of 2018.
Cellcom Israel revenue from mobile business dipped to NIS 420 million in the second quarter from NIS 434 million in the second quarter of last year.
