TV-plus-fibre bundles boost Bezeq’s yes TV in Israel

The launch of a TV-plus-fibre bundle boosted Israeli telco Bezeq-owned TV service provider yes’s top line for the second quarter, with IPTV customers now accounting for 64% of the unit’s base.

Yes’s revenues grew 6.3% to NIS336 million (US$90 million), driven by the launch of the TV + Bezeq fibre bundle, together new with agreements with international content providers

Adjusted EBITDA grew 56.5% to NIS72 million, with a margin of 21.4% compared to 14.6% in the corresponding quarter last year.

Adjusted net profit was the highest achieved since 2016 at NIS30 million, up from NIS4 million.

Yes had 579,000 TV customers at the end of June, down marginally on the first quarter but up from 567,000 year-on-year.

IPTV accounted for 364,000 of those at the end of June, up from 280,000 a year ago. Fibre customers at the end of June numbered 21,000, up from 14,000 in Q1 and from zero a year ago, before the bundle was launched.

Bezeq said that yes subscribers using streaming offering yes+ and connected TV app StingTV, both of which are delivered via the Internet amounted to approximately 64% of all yes subscribers.

Ilan Sigal, CEO of yes and Bezeq mobile arm Pelephone, said, “Our business-focused strategy in Pelephone and yes is bearing fruits. yes delivered record quarterly results leading to the highest net profit since 2016, while increasing revenues and improving profit metrics, a result of our focus on fibre as well as agreements with international content providers. Despite the competition in the television market, we successfully maintained our customer base and even grew customers year-over-year. We continue to grow and lead the IPTV market with approximately 370k subscribers, representing 64% of our customer base today.”

Analysts at Jefferies said that Bezeq’s overall results were in line, and that the company beat its EBITDA and net profit expectations.

“Strong execution across all infrastructure fronts continues, especially in FTTP and IPTV. FTTP monetisation continues to be seen with pick-up in ARPUs and subs growth. Bezeq has rallied from the July lows; we see enough in this print to support that re-rating,” the analysts said, giving the telco a ‘buy’ recommendation.

The yes results also indicate that Bezeq’s merger of its international consumer business with yes and the combination of infrastructure and ISP divisions a couple of years ago is bearing fruit. The company said at the time that the Bezeq International-yes merger would allow it to implement a triple-play strategy for the first time.