Delek Group profit drops due to writedowns

Delek Group published results for the three and six month period ended June 30, 2014.

Group revenues for the first six months of 2014 were approximately NIS 10 billion, at a similar level to that of the same period last year.

Operating profit was NIS 338 million in the first six months of 2014 compared with NIS 836 million last year, mainly due to a reduction in the operating profit from the insurance segment in Israel as well as an increase in the amortization of assets in the process of being sold.

Net loss for the first six months of 2014 totaled NIS 795 million, compared with a net income of NIS 569 million in the first six months of 2013.

The loss was due to the balance sheet write-down of the values of various holdings which the company intends to divest of in the near future. In line with IFRS, following the sale of Delek US shares, the agreements with regard to the sale of Republic Insurance Companies and Barak Capital, as well as the non-binding MOU signed to sell and cede control of Phoenix Holdings, NIS 984 million was written down, thereby significantly reducing the net profit. The net income excluding the amortization impact, reaches NIS 189 million compared to NIS 569 million for the same period last year.

Cash balance at the Delek Group correct as of August 28, 2014, stands at NIS 2.2 billion (including unutilized credit lines).

1 Israeli shekel = 0.280113 U.S. dollars

Press Release, August 29, 2014; Image: Delek Group