Daily roundup / EZchip clears a very low bar
Migdal insurance up this quarter; duty-free giant accused of deceipt; Mirland's luxe St. Petersburg housing moves ahead.
Migdal net jumps as markets smile: The Migdal insurance group on Thursday reported netting NIS 180 million for the third quarter of 2012, compared with losing NIS 113 million in the same quarter of yesteryear. Its income from premiums increased 10% to NIS 2.43 billion, the insurer said. Net profit came to NIS 58 million, while in the parallel quarter Migdal ran a loss of NIS 5.9 million. The fortunes of insurance companies, in Israel at least, depend mainly on the state of the capital markets; since they've done not badly this year, for January-September Migdal racked up NIS 261 million, compared with a loss of NIS 20 million in the same nine months of 2011.
James Richardson, labeling scofflaw? An NIS 290 million class-action motion was filed on Thursday against James Richardson, claiming the duty-free retailer indulges in misleading advertisements and fails to mark products in Hebrew. Nor does it mark prices of products per unit, claims the motion. It is, in short, "almost completely ignoring the law," snarls the lead plaintiff in the motion. Among the info missing in Hebrew is nutritional data on food products, claims the suit. And where does its advertising mislead? In claiming "You won't find cheaper than the duty-free," while it seems that isn't true, says the suit. James Richardson commented that it adheres to the law.
Market cheers as EZchip surpasses very low expectations: On the bright side, EZchip could report that its third-quarter earnings of 10 cents per share beat market forecasts by 14% , which is nice. That alone sent its stock popping 14.6 percent on Nasdaq to $34.80 on Thursday. On the flip side, EZchip – a fabless, which means it designs but does not manufacture semiconductors – also admitted that revenues tumbled 50% year over year to a measly $9.3 million, and non-GAAP profit sank by 68% to $3.1 million. So why did the market smile on the firm? Because the market had expected even worse. Now you know.
Russian bank funding Fishman: Mirland, the real estate company through which Israeli businessman Eliezer Fishman pursues his Russian real estate ambitions, has locked in NIS 200 million in funding for its flagship housing project in Triumph Park, St. Petersburg. The lolly will be forthcoming from Sberbank of Russia, which is extending credit of $47.5 million for the project's second stage. That's about 70% of the projected cost of building said second stage, which Mirland envisions taking about two years. That said, Mirland also envisions not tapping Sberbank for the full amount, as revenue influx from the first stage should cover much of the cost.
With reporting by Nathan Sheva and Yasmin Gueta