Business in Brief: Peak in Fattal Hotels Finances Values Company at Up to 3.5 Billion Shekels

Frutarom profit, sales grow amid buying binge; Ability sales plunge as newly launched product awaits sales; Record high on Wall Street lifts Tel Aviv shares.

Stock prices flash on an electronic screen displaying world clocks at the Tel Aviv Stock Exchange (TASE) in Tel Aviv, Israel, on Thursday, Dec. 11, 2014.
Bloomberg

Peak in Fattal Hotels finances values company at up to 3.5 billion shekels

Investors got their first-ever glimpse of the finances of Fattal Hotels Monday when a credit rating company released a report on Israel’s biggest hospitality group.

It showed that the company enjoyed rapid growth over the last three years after undertaking a massive expansion drive in Europe that brought its global portfolio of hotels to 100 properties and 17,000 rooms. In 2015, Fattal had turnover of 1.6 billion shekels ($420 million), 22% up on the year before, while earnings before interest, taxes, depreciation and amortization jumped 25% to 357 million and twice the pace of five years ago.

Measuring Fattal’s performance with peers like Hilton and Starwood, the company is estimated to be worth between 3.2 billion and 3.5 billion shekels, which would make David Fattal’s 71% stake in the company worth as much as 2.5 billion.

Fattal has sought twice in the past to float shares on the Tel Aviv Stock Exchange – once in 2007 at a value of about 650 million and in 2010 at about 1.7 billion. “We preferred to preserve our freedom to develop and out of the public eye. It was a decision taken at the last minute,” Fattal said Monday, expanding the decision to remain private. (Eran Azran)

Frutarom profit, sales grow amid buying binge

Frutarom, the acquisition-hungry maker of flavors and fragrances, said net profit grew 16% in the second quarter as sales were lifted by a strong series of acquisitions and by internal growth.

The company said net profit reached a record $30.3 million in the quarter, up from $26.1 million a year earlier as sales grew by 37.4% to a record $300.2 million. Earnings before interest, taxes, depreciation and amortization grew by 33.2% to $57.2 million, it said.

The company has been lifted by six acquisitions totaling $222 million so far this year and 11 others it made over 2015. CEO Ori Yehudai said Frutarom was focused on consolidating operations and production sites.

“We are continuing to work on building up and strengthening the global purchasing platform, exploiting our purchasing power, which has grown significantly in recent years, and switching to buying raw materials in source countries, particularly natural raw materials,” he said.

Frutarom shares finished up 0.7% at 202.80 shekels. (TheMarker Staff)

Ability sales plunge as newly launched product awaits sales

Ability reported plunging sales and a loss for the second quarter, saying its newly launched ULIN spy technology had yet to gain sales momentum.

The company said it lost $3.1 million, down 50% from a year ago as revenues plummeted to just $1 million, compared with $21.2 million a year earlier, a drop Ability ascribed to the shift of customers to ULIN, which enables a user to listen in on cellphone communications anywhere in the world with no more than the target’s phone number.

“As with any new and disruptive technology, the sales cycle can be lengthy and difficult to project, but I am encouraged with the size and quality of the potential deals in our pipeline,” said CEO Anatoly Hurgin.

As of early August, Ability said it had six potential ULIN deals in the works plus two for which it has already received orders. Ability shares ended down 14.4% to 17.50 shekels ($4.58). (Omri Zerachovitz)

Record high on Wall Street lifts Tel Aviv shares

Tel Aviv shares rose Monday after a long holiday weekend, as U.S. stock indexes traded at all-time highs and oil prices jumped to a one-month high of about $48 a barrel.

The benchmark TA-25 index ended 0.3% up at 1,472.45 points, while the TA-100 gained 0.4% to 1,297.80, on thin turnover of about 952 million shekels ($250 million). Teva Pharmaceuticals led the most actives for the day, rising 2.2% to 205.90 shekels. Tech and energy shares led the market, with Compugen pacing gains for the TA-100 on a 6.2% rise to 26.83.El Al Airlines gained 2.4% to 3.07 but Super-Sol was down 1% to 13.60 in heavy trading.

Earnings were a major factor: Ham-Let closed up 18.2% at 40.62 after reporting a 72% year-on-year rise in second-quarter net profit. Melisron lost 1.5% to 168.50 after it said net profit dropped to 49.7 million from 78 million on write-downs on its property portfolio. (Omri Zerachovitz)