 TEL-AVIV, Israel , Aug. 19, 2020 GLOBE NEWSWIRE -- B Communications Ltd. NASDAQ Global Select Market and TASE: BCOM BCOM or the Company, a holding company with a controlling interest in Israels largest telecommunications provider, Bezeq, The Israel Telecommunication Corporation Limited Bezeq TASE: BEZQ, today reported its financial results for the second quarter of 2020. Comments of Tomer Raved, CEO of B Communications:While the novel coronavirus pandemic COVID-19 continues to impact Israel and the global populations, our group is working to help consumers, businesses and communities in these uncertain times by maintaining and improving our leading telecom infrastructure, as well as by providing important services and support to the entire market. We continue to implement our strategy and vision for the Israeli telecom market while positioning the group for long term success, Mr. Raved noted. We are proud of our second quarter results, which reflect gradual improvements across our entire group. We welcome Mr. Gil Sharon, Bezeqs incoming Chairman, to the group, and we are happy to be taking part in the upcoming revolution in Israels communication infrastructure, primarily around 5G and fiber optics, he concluded.COVID-19 UpdateTelecommunications companies as a whole belong to the infrastructure sector, which is an essential sector that requires and enables almost complete operational activity during a crisis. The availability and consumption of telecommunications services is essential and remains intact in such an event. Therefore, Bezeqs exposure to risks related to the COVID-19 crisis is relatively limited and low relative to companies in other sectors. In addition, although the COVID-19 crisis has global implications, the telecommunications sector to which Bezeq belongs is essentially local, based on local infrastructure and provides services mainly to the Israeli consumer market.As of June 30, 2020, and as of the date of approval of our report for the second quarter of 2020, there was primarily a decrease in revenues from Pelephones roaming services, as well as some decrease in revenues from the business sector in all of the Bezeq group companies. The overall impact of the COVID-19 pandemic on the financial and business position of the group companies was mixed, as the growth in Bezeqs operations along with the measures taken by the groups companies counteracting the effects of the pandemic and offsetting most of the decrease in revenues from Pelephones roaming services.The Company estimates that the groups financial robustness, cash-generating capacity, high cash balances, strong debt structure and its ready access to the capital markets and credit providers will enable it to adequately deal with the effects of the pandemic and its possible continuation or worsening beyond the groups assumptions.Litigations UpdateSettlement of Israeli Derivative ActionOn March 30, 2020, the Company entered into a settlement agreement concerning a derivative action commenced in July 2016 that had been pending in Tel Aviv-Jaffa District Court the Horev Derivative Action. The derivative claim had alleged that the Company had distributed an unlawful dividend of NIS 113 million, including approximately NIS 73 million to the Companys former controlling shareholder, Internet Gold Golden Lines Ltd. Internet Gold. Under the settlement agreement, the Company will receive a total of New Israeli Shekels NIS 22 million principal plus accrued interest of the Companys Series C Debentures currently held by Internet Gold, in return for a waiver of the derivative action against Internet Gold. The derivative plaintiff will be awarded a total amount of NIS 4.23 million for expenses, lawyers fees and reward which amount will come out of the NIS 22 million amount being paid by Internet Gold. This funding and the closing of this case are expected to happen during the third quarter of 2020.On June 2, 2020, the Company and its former directors entered into a settlement agreement as part of the Horev Derivative Action, under which those directors will pay NIS 2.5 million the Directors Settlement Amount to the Company to settle all outstanding claims in that matter. In July 2020, after the final court approval, the settlement was completed and fully funded. The Companys DO insurance paid the Company the full Directors Settlement Amount and the Company paid the derivative plaintiff and its counsel a total amount of NIS 720 thousand.Settlement of U.S. Class ActionOn March 4, 2020, the Company announced that it entered into an agreement to settle the class action in the United States District Court for the Southern District of New York entitled Rex Roberta Ling Living Trust v. B Communications Ltd., which had commenced in 2017. On August 10, 2020, the court granted final approval for the settlement and the allocation of the settlement proceeds. The Company paid 1.2 million, which was fully covered by its DO insurance policy, and was released from any and all claims related to the class action by both the named plaintiffs as well as all members of the settlement class, with no admission of liability or any form of wrongdoing whatsoever.B Communications Unconsolidated Financial Liabilities and Liquidity June 30, June 30, June 30, December 31, 2019 2020 2020 2019 In millions NIS NIS US NIS Financial liabilities Series B debentures 237 - - - Series C debentures 1 2,282 1,884 543 1,884 Series D debentures 1 - 58 17 58 Series E debentures - 101 30 100 Total financial liabilities 2,519 2,043 590 2,042 Liquidity Cash and short-term investments 663 254 74 459 Long term bank deposits - 161 47 - Pledged account 2 43 39 11 39 Total liquidity 706 454 132 498 Net debt 1,813 1,589 458 1,544 1 Series C and D debentures balances on the Companys statements of financial position as of June 30, 2020 include amortized discount of NIS 159 million 46 million NIS 175 million as of December 31, 2019. 2 Pledged for the benefit of the holders of the Series C Debentures, Series D Debentures and Series E Debentures. Pursuant to the indentures for the Series C Debentures, Series D Debentures and Series E Debentures, the account is required to include sufficient funds to meet the next interest payment payable to the holders of these debentures. The funds are invested in long term bank deposits. B Communications Second Quarter Unconsolidated Financial Results Three months ended June 30, Year ended December 31, 2019 2020 2020 2019 In millions NIS NIS US NIS Financing income expenses, net 24 27 8 78 Operating expenses 5 4 1 16 PPA amortization, net 10 1 - 38 Impairment losses 819 2 1 590 Interest in Bezeqs net profit loss 165 72 21 287 Net profit loss 1,023 40 11 853 As of June 30, 2020, B Communications held approximately 26.34 of Bezeqs outstanding shares. B Communications interest in Bezeqs net profit for the Second quarter of 2020 totaled NIS 72 million 21 million, compared to interest in Bezeqs loss of NIS 165 million for the Second quarter of 2019.B Communications performed a full impairment test of its investment in Pelephone after Pelephone revenues from roaming services decreased as a result of the COVID-19. As a result, the Company recorded impairment losses of NIS 2 million 1 million in the second quarter of 2020.B Communications unconsolidated net financial expenses for the Second quarter of 2020 totaled NIS 27 million 8 million compared to NIS 24 million for the Second quarter of 2019. Net financial expenses for the Second quarter of 2020 included mainly NIS 19 million 5 million of accrued interest expenses.B Communications unconsolidated net profit for the Second quarter of 2020 was NIS 40 million 11 million compared to loss of NIS 1.02 billion for the Second quarter of 2019.B Communications Second Quarter Consolidated Financial ResultsB Communications consolidated revenues for the second quarter of 2020 totaled NIS 2.16 billion 623 million, a 3.1 decrease from NIS 2.22 billion for the second quarter of 2019. The decrease in revenues was due to lower revenues in Pelephone, Bezeq International and Yes, partially offset by an increase in revenues in Bezeq Fixed-Line.B Communications consolidated operating profit for the second quarter of 2020 was NIS 505 million 146 million, compared to an operating loss of NIS 536 million for the second quarter of 2019.B Communications consolidated net profit for the second quarter of 2020 totaled NIS 237 million 68 million compared to a consolidated loss of NIS 1.87 billion for the second quarter of 2019.B Communications net profit attributable to shareholders for the second quarter of 2020 was NIS 40 million 12 million compared to a loss of NIS 1.02 billion for the second quarter of 2019.Bezeq Group Results Consolidated To provide further insight into its results, the Company is providing the following summary of the consolidated financial report of the Bezeq Group or the Group for the quarter ended June 30, 2020. For a full discussion of Bezeqs results for the quarter ended June 30, 2020, please refer to its website: Group consolidated Q2-2019 Q2-2020 change NIS millions Revenues 2,224 2,155 3.1 Operating profit loss 94 512 Operating margin 4.2 23.8 Net profit loss 1,573 270 EBITDA 384 977 154.4 EBITDA margin 17.3 45.3 Adjusted EBITDA 831 872 4.9 Adjusted EBITDA margin 37.4 40.5 8. 