Boymelgreen reports NIS 105m Q2 loss

Real estate firm Boymelgreen Capital reported another quarter in the red yesterday, further deepening the financial hole of its controlling shareholder, the American developer Shaya Boymelgreen.

The company's second-quarter revenues amounted to NIS 93.4 million, down 44% from the same period of 2009.

It lost NIS 45.5 million from current operations, compared with a profit of NIS 10.3 million a year earlier.

Financing costs of NIS 86 million didn't help: Boymelgreen Capital posted a second-quarter net loss of NIS 105 million attributable to shareholders. But then in the corresponding quarter of 2009 it had posted a net loss of NIS 214 million.

Cash flow from current activities contracted by 13% to NIS 45.8 million.

Boymelgreen Capital is operating with a going concern warning on its financial statements, based on concerns that it won't be able to refinance its debts this year and next, and on a lack of resources to repay its liabilities, which totaled NIS 824 million at the end of the second quarter.

If the banks call in their loans, the company doesn't expect to have the resources to comply, it says.

For the first half, Boymelgreen Capital reported a 13% drop in revenues to NIS 285.5 million and a net loss attributable to shareholders of NIS 141.3 million. The reasons for the lower revenue were the company's exit from the tourism business.

At the second quarter's end Boymelgreen Capital had an NIS 700 million equity deficit, up from an equity deficit of NIS 276 million at the end of the same quarter of 2009.

In June, Discount Bank sued to have Shaya Boymelgreen declared bankrupt based on his guarantees to Boymelgreen Capital. In the meantime, the company is trying to reach an arrangement with its bondholders.