It's the latter. The verb to be isn't usually used in the present tense in modern Ukrainian, so the – indicates where it was omitted.

I agree with what jmago said. If the ommittance of "to be" is hard to understand in the beginning, you can use a construction like "ye +ajective/pronoun+noun" with changed affixes: moya sestra ye dyzaynerom/Моя сестра є дизайнером. Another example, with an ajective: A rose is a beautiful flower: Троянда є красивою квіткою/Troyanda ye krasyvoyu kvitkoyu.