JERUSALEM, March 26 (Reuters) - Cellcom , Israel’s largest mobile operator, reported a 29 percent drop in quarterly profit as competition in the sector intensified and said it would accelerate the deployment of a fibre optic network.
Cellcom said on Monday it earned 10 million shekels ($3 million) in the fourth quarter, down from 14 million a year earlier.
Revenue slipped 0.9 percent to 975 million shekels, with the company attributing the drop to price erosion from competition in the mobile sector, although revenue from fixed-line services rose.
The company had been forecast to earn 22 million shekels on revenue of 974 million, according to a Reuters poll of analysts.
Israel’s mobile phone industry was shaken up in 2012 with the entry of a host of new operators, sparking a price war that led to steep drops in subscribers, revenue and profit for Cellcom and other incumbents.
Cellcom’s lower-cost Internet-based TV service has to date recruited 183,000 subscribers for a market share of about 11 percent. At the end of 2017, it also had 222,000 customers for its internet services.
Cellcom’s mobile subscriber base gained 0.6 percent in 2017 to 2.817 million.
CEO Nir Sztern said the company would accelerate its deployment of a fibre optic network to customers’ homes that would provide Internet speeds of up to 1 gigabit “in order to cement ourselves as a dominant player in the fixed-line infrastructure market.”
The company said its board once again decided not to declare a dividend for the quarter given the intensified competition and to strengthen its balance sheet.
$1 = 3.4903 shekels Reporting by Steven Scheer, editing by Louise Heavens