Fair value assessments boosted the net profit of AFI Development plc (LSE:AFID), the Russian development arm of Lev Leviev-controlled Africa-Israel Investments Ltd. (TASE:AFIL) to $118.2 million ($11.27 per share) for the third quarter of 2011, from $9.1 million for the corresponding quarter. The company reported a valuation gain on its assets of $175.4 million for the third quarter, compared with zero for the corresponding quarter.
Revenue tripled to $34.8 million, including $34.6 million in rental income, for the third quarter, from $11.1 million for the corresponding quarter. Rental income AFIMall City in Moscow totaled $25 million in the third quarter, and $43 million since it opened earlier this year.
However, foreign currency translation differences cost AFI Development $99.5 million in the third quarter, compared with a gain of $22.9 million in the corresponding quarter. As a consequence, comprehensive income was $18.7 million, of which $18.6 million accrued to majority shareholders, down from comprehensive income of $32 million for the corresponding quarter.
AFI Development's net asset value (NAV) rose to $1.84 billion at the end of September, $112 million more than at the end of 2010, and it had $107.2 million in cash and cash equivalents at the end of September.
Leviev said, "The main achievement of the third quarter of 2011 was successful completion of the city share buy-out transaction at AFIMALL by securing full financing for this deal from VTB Bank. Successful completion of this transaction is an important milestone for our flagship project."
AFI Development's share price rose 6.4% at the opening in London to ₤0.50, giving a market cap of ₤220 million. Africa-Israel's share price rose 2.8% in morning trading on the TASE to NIS 11.92, giving a market cap of NIS 1.4 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on November 22, 2011
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