TEL AVIV, Israel, Nov. 27, 2014 /PRNewswire/ -- Delek Group
Ltd. (TASE: DLEKG, OTCQX: DGRLY) (hereinafter: "Delek Group" or
"The Group") announced today its results for the three month period
ended September 30, 2014. The full
financial statements are available in English on Delek Group's
website at: www.delek-group.com.
Third Quarter 2014 Highlights
- The Group continues to examine and make progress on its
preparations for an additional listing of shares on the London
Stock Exchange;
- The estimate of contingent and prospective natural gas
resources in the Aphrodite Reservoir was increase from 4.1 TCF up
to a new best estimate of 4.5 TCF;
- Net income reached NIS 150
million for the third quarter of 2014;
- Delek Group announced a dividend of NIS 150 million for the third quarter of
2014;
- The Company made a number of divestitures during 2014. Delek
Europe was sold on August 28;
Roadchef was sold on September 30;
34% of Republic was sold together with the control on October 26; Barak Capital was sold in
July 2014;
- Holdings in Roadchef, Delek Europe, Barak Capital and
partially in Republic were sold for total proceeds of NIS 2.85 billion
Group revenues for the third quarter of 2014 were
approximately NIS 5.2 billion,
compared with NIS 5.6 billion in the
same period last year. There were an increase of revenues
from the oil and gas exploration and development operations. On the
other hand, there were a decrease in the revenues from the Israeli
downstream operations and the Finance and Insurance operations.
Operating profit was NIS 439
million in the third quarter of 2014 compared with
NIS 422 million in the same period of
last year. The increase was mainly due to an increased contribution
from the oil and gas exploration, and the gas production operations
segment, which was somewhat offset by a decrease in the
contribution from the fuel operations in Israel in as well as by a depreciation charge
at Phoenix, the insurance company,
which is in the process of being sold.
Net income for the third quarter of 2014 totaled
NIS 150 million, representing 103%
growth compared with a net income of NIS 74
million in the third quarter of 2013.
The increase was due to the contribution to the net income of
the oil and gas exploration, and gas production operations segment
as well as a contribution of the insurance and financial services
segment and the automotive operations.
Cash balance at the Delek Group, correct as of
November 27, 2014, stands at
NIS 2.7 billion (including unutilized
credit lines).
In accordance with the Company's strategic plan to concentrate
on developing its core assets in the field of energy, the Company
divested from and realized the value in some of its non-core
assets. The Group's principal assets will be concentrated in the
energy field, in both the gas and oil upstream operations and the
Israeli downstream operations.
In addition, the Company is currently exploring the possibility
and making preparations for registering the Company's shares for
trading on the London Stock Exchange in mid-2015, in addition to
its current listing in Israel.
Commented Mr. Bartfeld, CEO of Delek Group,
"During the third quarter, as well as October, we made a series of
successful exits. This is a solid representation of our ongoing
achievements and success in executing on our strategic decision to
focus on the upstream energy. In the coming quarters, we intend to
continue our strategy of focusing the group on the exploration,
development and production of natural gas and oil with an emphasis
on promoting the development plans of Leviathan, as well as
identifying new opportunities in these areas."
Mr Bartfeld continued, "We continue to promote the
listing of Delek Group shares for trading on the London Stock
Exchange. We believe that as a leading Israeli company with strong
results, high liquidity and strong balance sheets, the Group is
positioned as an attractive investment for foreign investors. We
believe that a UK listing will allow increased exposure to the
Group's energy activities to a large and diverse international
investors' base, and is a step in our long-term goal of becoming a
leading international energy company."
Main Business Highlights
|
Contribution of
Principal Operations to Net Income (NIS millions)
|
|
|
|
9M
2014
|
9M
2013
|
Q3
2014
|
Q3
2013
|
FY
2013
|
|
Oil and Gas
Exploration, and Gas Production Operations
|
147
|
46
|
53**
|
41
|
70
|
|
Fuel Operations in
Delek Europe
|
(4)
|
46
|
-
|
27
|
14
|
|
Fuel Operations in
Israel
|
39
|
30
|
(5)
|
16
|
34
|
|
Motorway Service Area
Operations in the UK
|
(2)
|
3
|
14
|
24
|
(2)
|
|
Insurance and Finance
Operations in Israel
|
187
|
296*
|
71
|
59*
|
368
|
|
Oversees Insurance
Operations
|
17
|
38
|
19
|
17
|
65
|
|
Automotive
Operations
|
95
|
108
|
44
|
24
|
125
|
|
Fuel Operations in the
US
|
10
|
194
|
-
|
(7)
|
194
|
|
Contribution to Net
Income before Capital Gains & Others
|
489
|
761
|
196
|
201
|
868
|
|
Capital Gains &
Others(1)
|
(1,134)
|
(118)
|
(46)
|
(127)
|
(128)
|
|
Net Income (Loss)
Attributed Group's Shareholders
|
(645)
|
643
|
150
|
74
|
740
|
|
|
|
|
|
|
|
|
* Restated, see Note
2d financial statements.
|
** Excluding onetime
effects.
|
(1) In the
nine months ended September 30, 2014, and in light of actions taken
to dispose of several assets as aforesaid, the Company included a
number of accounting write downs due to changes in the fair value
of such assets, including Delek USA, Republic, and The Phoenix. In
the third quarter of 2014, the item includes gains of approximately
NIS 250 million on the sale of Roadchef shares, offset by losses of
approximately NIS 210 million on the sale of Delek Europe.
This item also includes the results of other operations,
unattributed finance expenses, other expenses, and tax
expenses.
|
|
Parts of the above
table have been extracted from Delek Group's Third Quarter of 2014
Directors Report.
|
Please review the
full report available on the Group's website www.delek-group.com to
view the notes for each of the items above.
|
Energy & Infrastructure
Oil and Gas Exploration (Israel) Sector Highlights
Tamar Project, 11 TCF natural gas discoveries
(Tamar and Tamar SW). Tamar produced 2.2 BCM of natural gas in
the third quarter of 2014. In addition, Tamar sold 104 million
barrels of condensate in the third quarter of 2014.
On October 17, 2014 a non-binding
Letter of Intent ("LOI") was signed between the Tamar Partners,
including the Company's gas subsidiaries, and Dolphinus Holdings
Limited in which the parties confirmed their intention to carry out
exclusive negotiations on an agreement for the supply of natural
gas from the Tamar Project using the existing gas pipeline operated
by East Mediterranean Gas Ltd for exclusive marketing to customers
in Egypt. The supply period as
stipulated in the LOI is for 7 years to supply 250,000 MMBtu per
day on an interruptible basis (with a minimum of cumulative amount
of 5 BCM over a period of 3 years), and the price includes a floor
rate and will be linked to the price of Brent.
In addition, the Tamar partners, including the Company's gas
subsidiaries, are in advanced stages with Union Fenosa Gas SA of
Spain towards the completion and
signing of a Binding Agreement for the supply of natural gas to its
existing liquefaction facilities in Egypt.
Leviathan, a 22 TCF natural gas
discovery; On September 3,
2014, Noble Energy Mediterranean Ltd signed a non-binding
LOI with the National Electric Power Company of Jordan. The estimated scope of the final
agreement is for the supply of 45 BCM over a period of 15 years.
The supply of the gas will take place at points to be determined on
the Israeli-Jordanian border. The price of gas stipulated in the
LOI is similar to the prices set in other agreements for the export
of gas from Israel and is linked
to the prices of a barrel of Brent oil and includes a floor
price.
In addition, the Leviathan partners, including the Company's gas
subsidiaries, continue their negotiations with BG International
Ltd., a subsidiary of the British company BG Group PLC, towards the
signing of a Binding Agreement for the supply of natural gas to its
existing liquefaction facilities in Egypt.
Aphrodite, a 4.5 TCF (Contingent &
Prospective) natural gas discovery located in the Block 12 license,
off the coast of Cyprus; on
November 19, 2014, a full reservoir
update report prepared by Netherland, Sewell & Associates, Inc.
was released, which increased the estimate of contingent and
prospective natural gas resources in the Aphrodite Reservoir from
4.1 TCF up to a new best estimate of 4.5 TCF, and condensate
resources from 8.1 MMboe to 9 MMBoe at the same category, as at
September 30, 2014.
Gas Production Summary: The contribution to net
income from the sector for the third quarter of 2014 was
NIS 53 million excluding onetime
effects, compared with a net profit of NIS
41 million in the same period in 2013. It should be noted
that there was a depreciation expense in respect of Noa in the
amount of NIS 15 million in the third
quarter of 2014.
Downstream Energy Sector Highlights
Delek Europe; on August 28,
2014, the closing of the agreement to sell the Company's
holdings in Delek Europe BV for the amount of € 355 million
(NIS 1.7 billion) was reached. A
total of €180 million was received during the third quarter of 2014
and the remaining balance of €175 million was granted as a
loan.
Roadchef (fully held by Delek Group); on
September 30, 2014, the Company's
sold its entire holdings in Roadchef to Antin Infrastructure
Partners, a European infrastructure fund, for approximately
GBP 153 million (approximately
NIS 900 million). On the closing
date, the Company recognized a profit of approximately NIS 253 million.
Insurance and Financial Services
In light of the sale process of the Phoenix (of which Delek Group holds 52%),
in the third quarter of 2014 the Company recognized a NIS 50 million impairment on its investment in
the Phoenix. In the third quarter,
Phoenix contributed a
profit of NIS 71 million to the
Group's net income compared with NIS 59
million in the same period last year. The results of The
Phoenix's operations in the
reporting period were materially affected by a decrease in Israeli
interest rates, which was offset by a higher income from management
fees.
On October 23, 2014, a transaction
to sell approximately 34% of its holdings in Republic (of
which Delek Group currently holds 66%) was completed and the
control of Republic was transferred to a group of investors from
the United States. Proceeds
totaling approximately US$ 75 million
(approximately NIS 280 million) have
been paid in full.
The Group's holdings in Barak Capital, of which the Group
held approximately 47%, were sold for NIS
240 million in July 2014.
Dividend Distribution
On November 26, 2014, the Board of Directors of
Delek Group declared a cash dividend distribution for the third
quarter of 2014 in the amount of approximately NIS 150 million (approximately NIS 12.7761 per share) to the shareholders on
record as of December 14, 2014 and
the dividend will be paid on December 30,
2014.
Conference Call Details
The Company will be hosting a
conference call in English on Thursday, November 27, 2014. Management will also
be available to answer investor questions.
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 0644
INTERNATIONAL Dial-in Number: +972 3 918 0644
At:
8:30am Eastern Time, 1:30pm UK Time, 3:30pm Israel Time
On the call, Chairman Gabriel
Last, CEO Asaf Bartfeld and
CFO Barak Mashraki will review and
discuss the results, and will be available to answer your
questions.
About The Delek Group
The Delek Group, Israel's dominant integrated energy company,
is the pioneering leader of the natural gas exploration and
production activities that are transforming the Eastern
Mediterranean's Levant Basin into one of the energy industry's most
promising emerging regions. Having discovered Tamar and Leviathan,
two of the world's largest natural gas finds since 2000, Delek and
its partners are now developing a balanced, world-class portfolio
of exploration, development and production assets with total gross
natural gas resources discovered since 2009 of approximately 40
TCF.
In addition, Delek Group has a number of assets in downstream
energy, water desalination, and in the finance sector.
For more information on Delek Group please visit
www.delek-group.com or Email: investor@delek-group.com
Delek Group Income Statement (NIS Millions)
|
9M 2014
|
9M 2013
|
Q3 2014
|
Q3 2013
|
FY 2013
|
Revenues
|
14,897
|
15,344
|
5,209
|
5,596
|
20,850
|
Cost of
revenues
|
11,346
|
11,979
|
3,924
|
4,414
|
16,227
|
Gross
profit
|
3,551
|
3,365
|
1,285
|
1,182
|
4,623
|
|
|
|
|
|
|
Sales, marketing and
gas station operating expenses
|
1,377
|
1,294
|
467
|
435
|
1,755
|
General and
administrative expenses
|
949
|
912
|
320
|
305
|
1,261
|
Other income
(expenses), net
|
(470)
|
82
|
(59)
|
(20)
|
(162)
|
Profit (loss) from
operating activities
|
755
|
1,241
|
439
|
422
|
1,445
|
|
|
|
|
|
|
Finance
income
|
203
|
169
|
84
|
89
|
109
|
Finance
expenses
|
970
|
1,150
|
276
|
505
|
1,316
|
Profit (loss)
after financing
|
(12)
|
260
|
247
|
6
|
238
|
|
|
|
|
|
|
Gains (loss) from
disposal of investments in investees and others, net
|
-
|
3
|
-
|
-
|
(8)
|
Group's share in
earnings (loss) of associate companies and partnerships,
net
|
150
|
366
|
64
|
180
|
430
|
Profit (loss)
before income tax
|
138
|
629
|
311
|
186
|
660
|
|
|
|
|
|
|
Income tax (tax
benefit)
|
122
|
415
|
120
|
153
|
492
|
Profit (loss) from
continuing operations
|
16
|
214
|
191
|
33
|
168
|
Profit (loss) from
discontinued operations, net
|
(385)
|
912
|
78
|
61
|
1,167
|
Net profit
(loss)
|
(369)
|
1,126
|
269
|
94
|
1,335
|
|
|
|
|
|
|
Attributable to
-
|
|
|
|
|
|
Company
shareholders
|
(645)
|
643
|
150
|
74
|
740
|
Non-controlling
interest
|
276
|
483
|
119
|
20
|
595
|
|
(369)
|
1,126
|
269
|
94
|
1,335
|
The notes are an integral part of the financial statement and
can be found at www.delek-group.com.
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/delek-group-announces-consolidated-results-for-the-third-quarter-of-2014-300002011.html
SOURCE Delek Group Ltd.