Delek Group Announces Consolidated Results for the First Quarter of 2010
(TASE: DLEKG , OTCQX: DGRLY) (hereinafter: “Delek Group” or “The Group”)
announced today its results for the three month period ending
The full financial statements will be available in English on Delek Group’s
website at: http://www.delek-group.com.
First Quarter 2010 Highlights
- Improvement in profitability across majority of subsidiaries; first
quarter net income of NIS 205 million grew significantly by 31% over
first quarter of 2009
- Delek Group distributes a dividend of NIS 150 million in the quarter;
- Natural gas reserves discovered in the Tamar field remain on track for
commercialization in 2012 and additional exploration ongoing;
Group revenues for the first quarter of 2010 were
increase compared with
increase in revenues was primarily due to revenues from the US refinery which
while was operational in the quarter, was not operating in the first quarter
of last year. Additional revenue growth was due to an increase in the price
of oil compared with that of last year. In addition, the company saw improved
revenues in Automotive, Insurance and Finance operations.
Net income for the first quarter of 2010 totaled
increase compared with a net income of
of 2009. Net income increased due to an improvement across the majority of
sectors, in particular the automotive, financial and insurance sector.
Group total assets as of
compared with
Mr.
we reported today represent another solid quarter of improvements in our core
group activities. They are as a direct consequence of the correct strategic
actions that were taken by the management of Delek Group and its subsidiaries
throughout the past year, a strategy which has proven itself. We intend to
reinvest the substantial fruits of our efforts over the past years back into
the Company and expand our core activities.”
Continued Mr. Bartfeld, “The majority of our subsidiaries all had solid
quarters, but in particular we are very pleased with the performance of the
Phoenix Insurance company and our Automotive subsidiary. We have continued to
enhance our net asset value and strengthen our balance sheet across the Group
and all its subsidiaries, and this remains a constant core element of our
strategy. We have seen improvements in a number of key metrics including a
strong growth in revenues and net profit. Delek Group will continue its focus
on energy and infrastructure, as well as its automotive and finance
activities, and we remain vigilant in identifying business opportunities that
can generate synergies among the activities of our subsidiaries.”
Main Business Highlights
Contribution of Principal Operations to Net Income* (NIS millions)
FY Q4 Q3 Q2 Q1 Q1
2009 2009 2009 2009 2009 2010
27 (54) (14) 97 (2) (42) US Fuel Sector Operations
82 12 9 29 32 24 Israeli Fuel Sector Operations
59 13 (2) 41 7 16 Delek Europe
(16) (12) - - (4) - Restructuring expenses at Delek Europe
23 3 52 2 (34) 30 Oil and Gas Exploration
250 78 65 53 54 94 Automotive Operations
181 70 23 6 82 95 Insurance and Finance Operations
263 314 (73) (5) 27 (12) Capital Gains & Others
869 424 60 223 162 205 Net Income excl. Real Estate Activities
(5) - - - (5) - Real Estate activities
864 424 60 223 157 205 Net income attributed Group's
shareholders
* Parts of the above table have been extracted from Delek Group's First
Quarter 2010 and Full Year 2009 Directors Report.
Please review the full report available on the Group’s website
http://www.delek-group.com to view the notes for each of the items above.
Energy & Infrastructure
The Oil and Gas Exploration, and Gas Production sector. In
partners in the drilling at the ‘Tamar’ field received a third party reserve
report, showing the amount of 2P (proved and probable) reserves of natural
gas to be as high as 7.7 TCF (218 BCM) at the Tamar Field. On
it was announced by the partners of the gas fields, the purchase of
additional equipment and services required for further development of the gas
fields, totaling
On
natural gas to Southern Power Station Ltd, and DSI Silica Industries Dimona,
Ltd. Tamar’s partners have already signed agreements totalling over
the supply of natural gas following commercialisation, which is expected in
2012 and remains on track.
The partnership also confirmed its participation in drilling two
additional production wells in the gas fields ‘Mary’, in areas known as
Mary-B 8 and Mary-B 9, at a total cost (for all partners) of approximately
natural gas reserves at Mary B, amounts to 13.3 BCM, an increase of about BCM
1.9 compared with previous estimates, and proved and probably natural-gas
reserves amounts to BCM 14.0, an increase of about BCM1.2 compared with
previous estimates.
The Company, along with its partner Noble Energy Inc, is continuing
additional seismic studies in the surrounding area and expects the results of
these studies in the coming months.
During the quarter, revenues from the sale of oil and gas reached
million
was due to an increase in sales to the Israel Electric Company due primarily
to an increase in sale price, based on agreements signed with the Israel
Electric Company and Israel Chemicals at the end of
same time, a reduced volume of gas was sold compared with the same period
last year. This was due to reduced public demand for electricity due to more
temperate weather conditions in the first months of the year, as well as
increased sales by the alternative gas supplier EMG to the IEC. Despite the
decline in gas volumes sold, there was no significant change in net income
due to the increased price of gas and currency exchange rate impacts.
Net income from the sector for first quarter of 2010 was
as compared to a net loss of
Delek US (NYSE: DK; Delek Group holds 73% end-Q1 2010): Revenues in the
first quarter of 2010 were
the first quarter of 2009. It is important to note that in the first quarter
of 2009 the refinery at
Net loss in the first quarter of 2010 was
loss of
were adversely impacted by a combination of severe winter weather in several
of core retail markets during January and February, in addition to weak Gulf
Coast refining economics which persisted for most of the quarter.
Contribution margin from the refining and marketing sectors was a profit
of
93 million
merchandise sales improved for the third consecutive quarter during the first
quarter 2010, due in part to increased contributions from reimaged store
locations open more than one year. A slight decline in the same-store fuel
gallons sold was offset by an increase in the first quarter retail fuel
margin, when compared to the year-ago period.
Looking ahead, Delek US’ management believes that entering the second
quarter, there is increased demand for refined products sold in the refining,
retail and marketing segments. This uplift in demand is primarily
attributable to a combination of favorable seasonal trends and improving
economic conditions in regional markets.
Delek – the Israel Fuel Company Ltd. (TASE: DLKIS.TA; Delek Group holds
77% end-Q1 2010): Revenues in the first quarter of 2010 were
compared with 856 million in the first quarter of last year, representing an
increase of 37%. This increase was due primarily to the increased price of
gas compared with that of last year, as well as an increase in sales of
gasoline for commercial enterprises, and an increase in sales at convenience
stores.
Net income in the first quarter of 2010 amounted to
compared with a net income of
Delek Europe. Delek is an operator of 850 gas stations across the Benelux
region. Revenues in the first quarter of 2010 were
with
price of gas compared with that of last year. Net income in the quarter was
of 2009.
During the quarter, Delek Europe made an offer to BP for the acquisition
of its retail fuels and convenience business in
stations and its interests in 3 terminals. Delek Europe has offered to pay
completion.
IDE (water desalination, 50% indirectly held by Delek Group). IDE
achieved a net income (100%) of
On
million
Insurance and Financial Services
The activities of this segment are primarily conducted through two
insurance companies; Israeli insurance company, Phoenix Holdings Ltd. (TASE:
PHOE), and general US insurer, Republic Companies, Inc. that is an indirectly
wholly owned subsidiary. The insurance and financial services sector
contributed
compared to a net income of
The results were improved over those of last year due to the significant
improvement in the capital market environment globally and in
past year.
Automotive Operations
Delek Automotive Systems Ltd. (TASE: DLEA.TA; Delek Group holds 55%
end-Q1 2010): Delek Automotive is the exclusive distributor of Mazda and Ford
in
1.0 billion
first quarter of 2010 reached
90 million
the first quarter of 2010 compared with 9,494 in the first quarter of last
year.
Dividend Distribution
On
dividend distribution for first quarter of 2010 in the amount of
approximately
shareholders on record as of
the dividend will be paid on
Conference Call Details
The Company will be hosting a conference call in English on
1, 2010
To participate, please call one of the following teleconferencing
numbers. Please begin placing your calls at least 5 minutes before the
conference call commences. If you are unable to connect using the toll-free
numbers, please try the international dial-in number.
US Dial-in Number: 1-888-668-9141
UK Dial-in Number: 0-800-917-5108
ISRAEL Dial-in Number: 03-918-0610
INTERNATIONAL Dial-in Number: +972-3-918-0610
At:
8am Eastern Time, 2pm UK Time, 4pm Israel Time
On the call, CEO
Relations,
available to answer your questions.
About The Delek Group
Delek Group is the leading energy & infrastructure group based out of
and power plants globally. In addition, Delek is the number one importer &
distributor of vehicles in
US. Earlier this year, Delek Group, through its subsidiaries, discovered
significant quantities of high quality natural gas off the coast of
Delek Group sales reached 43 billion Israeli shekels in 2009.
For more information on Delek Group please visit
http://www.delek-group.com.
Delek Group Income Statement (NIS Millions)
Q1 Q1 2009
2010 2009
Revenue 11,365 9,118 43,447
Cost of revenue 9,669 7,482 37,032
Gross profit 1,696 1,636 6,415
Sales, marketing and operating expenses
- gas stations 844 855 3,426
General and administrative expenses 402 422 1,768
Other income (expenses), net (13) 68 386
Profit from operating activities 437 427 1,607
Financing income, net 217 174 633
Financial expenses, net 273 308 1,449
Profit (loss) after 381 293 791
financing
Profit from realization of investments in
associates and others, net - - 518
Group's equity in profits (losses) of
associates and partnerships, net 70 65 92
Profit (loss) before income tax 451 358 1,401
Income tax (tax benefit) 107 100 215
Profit (loss) from continuing operations 344 258 1,186
Profit (loss) from discontinued operations - 17 17
Profit (loss) 344 275 1,203
Attributable to:
Company shareholders 205 157 864
Non-controlling interest 139 118 339
344 275 1,203
The notes are an integral part of the financial statement and can be
found at http://www.delek-group.com
Contact
Dalia Black Kenny Green / Ehud Helft
Head of Investor Relations International Investor Relations
Delek Group GK Investor Relations
Tel: +972-9-863-8444 Tel: (US) +1-646-201-9246
Email: black_d@delek.co.il E-mail: delek-group-ir@gkir.com
SOURCE Delek Group Ltd