Africa-Israel Investments Ltd. (TASE:AFIL), controlled by chairman Lev Leviev, today reported an 80% drop in its net profit for the first quarter of 2012, despite a 64% jump in revenue. Revenue rose to NIS 2.32 billion for the first quarter from NIS 1.42 billion for the corresponding quarter, but net profit attributable to equity shareholders fell to NIS 10 million (NIS 0.08per share) from NIS 50.8 million.
Operating profit rose 33% to NIS 240.2 million for the first quarter from NIS 180.8 million for the corresponding quarter.
Profits from real estate projects rose to NIS 177 million for the first quarter from NIS 150 million for the corresponding quarter. Profits from industrial operations fell to NIS 41 million from NIS 55 million, mainly due to lower prices for raw materials in late 2011 and early 2012 and lower steel sales in Russia. Africa-Israel share of losses from subsidiaries widened to NIS 48 million for the first quarter from NIS 13 million for the corresponding quarter.
The fair value of Africa-Israel's income-producing properties for investment totaled NIS 9.11 billion, almost half of it in its Russian properties, at the end of March. The value of its income-producing properties under construction was NIS 4 billion, and the value of its housing inventory available for sale was NIS 1.98 billion. The value of company's land reserves was NIS 2.2 billion.
Africa-Israel CEO Izzy Cohen said, "Africa-Israel continues to implement its business strategy of focusing on real estate development, business development, a speedy resumption of the development of income-producing properties, and use of its high-quality land reserves, which will be the basis for solid growth in future cash flows. At the same time, we are maintaining our strong capital structure, and high liquidity balance, which stand in sharp contrast to the high volatility in the Israeli and foreign capital markets."
Africa-Israel operates in real estate through Africa-Israel Properties Ltd. (TASE: AFPR), Africa-Israel Residences Ltd. (TASE:AFHS), its Russian development arm AFI Development plc (LSE:AFID), AFI Europe NV, and AFI USA Inc. It's steel business is handled through Africa-Israel Industries Ltd. (TASE: AFID), and Negev Ltd.
Africa-Israel's share price fell 1.3% by mid-afternoon to NIS 11.82, giving a market cap of NIS 1.6 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on May 30, 2012
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