Dear Shareholder,
A strong performance
This year, Partner has made further progress in the execution of its long-term strategy. We have managed to maintain a competitive cost structure despite the tough competition and the cost of implementing our new activities, thereby maintaining impressive profitability margins.
Partner's strategic decision to continue to invest in its excellent customer service and its new company-owned distribution channel is reflected in the impressive number of new net additional subscribers, which reached one hundred and forty four thousand. Our strong performance shows that our customers appreciate the efforts we have made.
Partner also continues to invest in its 3G and 3.5G network and services, reaching at year end approximately 1.3 million 3G subscribers. Partner's 3.5G network now covers more than 98% of Israel's most populated centers. The improved user experience provided by the 3.5G network has resulted in increased data and content usage and has contributed to data and content revenues growth.
The orange leadership
For the seventh year in a row,, orange TM was named by "Globes" the leading telecommunications brand in Israel. In parallel, "The Marker", Israel’s business daily newspaper, designated Partner as the mobile operator with the best customer service while we were also awarded the title of the most innovative company in the Israeli market by the same newspaper.
Partner has acquired its strong brand recognition above all through its top-ranked customer service. In order to support growth and to create an unshakable foundation for Partner's continued success, Partner continuously strives to improve customer satisfaction by upgrading its technology, service levels and customer response capabilities, at the same time as refining its management strategies to increase profitability. Achieving both qualitative and quantitative improvement is the principal goal of the Company.
A landmark year
2009 was a landmark year for Partner; in which we established we established the foundation for one of our future growth engines, strengthened our retail distribution channels while successfully going through a change in ownership.
Alongside the current content and cellular services that the Company is offering today, and given its strong local brand awareness, Partner chose to venture into new products and services which were introduced at the beginning of 2009: ISP services, fixed telephony and web based entertainment multimedia services. This is part of the Company's strategy to evolve from a pure cellular operator into a leading telecommunications company in Israel. These new activities are one of the foundations of the Company's future growth and represent a major opportunity to differentiate itself in the field.
Everything combined together – our vision
Partner's strong performance in 2009 was due to the Company’s ability to leverage its core strengths in network quality, brand value and customer service, combined with dedication to offering customers value-added services. Above all, Partner is committed to ceaselessly delivering innovative products and services across different communications platforms. By offering cellular and transmission services, as well as Voice Over Broadband (VOB) telephony and ISP services, Partner is continually broadening its portfolio of products and services to generate additional future sources of revenues, enhancing customer satisfaction and loyalty and thereby continuing our solid history of creating and delivering value to our customers, shareholders and employees.
Leading the future
2010 is expected to be a pivotal year in the global and local telecom industry and we believe that Partner’s operational and financial performance in 2009, coupled with our organizational culture and our fundamental business approach, provides Partner with the ability to meet future challenges and continue to lead the communication market in Israel.
Partner intends to work in two major avenues in 2010: the implementation of the second stage of our wireline growth strategy through maximization of the inter-company synergy, and the execution of our efficiency plan. On the product side, we intend to enrich our fixed line portfolio and to offer new, innovative and cost effective products and features which address new marketing segments.
A comprehensive organizational change has been implemented aimed at realizing Partner's strategy, as well as strengthening Partner's customer-centric approach. The change is mainly driven by the trend of convergence in communications services and by the increasing complexity of products and customers' needs. The new structure includes two main modifications to the organizational structure: • The establishment of the Private and Business Customers Divisions - each of them incorporating all aspects of customer care, including sales of a wide variety of fixed and mobile products, customer service, technical support and retention activities; • The amalgamation of the current Fixed Line Division into the new structure in order to maximize the synergy between fixed telephony and mobile services and also enlist existing sales channels to the fixed services sale efforts. Our talented, professional and seasoned management team will continue to leverage and maximize Partner's value and assets created over the years.
In addition, Partner hired a management consulting firm in 2009 with the goal of building a long-term efficiency program. We expect this move to strengthen the potential for short-term benefits and to support the long-term sustainability of our dividend payout.
On a final note, allow me to extend my deepest thanks and gratitude to the efforts of our devoted employees, management and Board of Directors for their commitment to constantly achieving new levels of excellence. Their dedication to setting and meeting demanding performance targets is a highly valuable asset to the Company. I would also like to express my sincere thanks to our shareholders and customers for their faith and trust in Partner. Focused on the execution of its strategy, Partner is strongly positioned to meet and overcome tomorrow's challenges and to continue to deliver value to all its stakeholders.
Sincerely yours
Ilan Ben Dov
Chairman of the Board
David Avner
CEO
