The Israel Electric Corporation has suffered its latest quarter of steep losses as operating and financial costs remain high.
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A doubling of financial costs and lower electricity sales triggered a second-quarter net loss of 777 million shekels ($221 million), the state-controlled company said Thursday. That was more than double the 361-million-shekel loss in the same period last year.
The IEC reported a 9% decline in revenues to 5.8 billion shekels, as electricity sales dropped 12% amid lower demand and new competition from private companies.
In the quarter, the utility suffered a 95-million-shekel jump in administrative and general expenses, and a 100-million-shekel jump in the payout for employee retirement benefits.
Financial costs during the quarter more than doubled to 765 million shekels as the shekel appreciated. That all but wiped out the 780 million shekels in savings on fuel now that the company is using natural gas to generate electricity.
Overall debt continued to decline, however, to 69.8 billion shekels at the end of the quarter from 73.6 billion shekels a year earlier.
“We attach great importance to continued improvement in cash flow from ongoing operations, letting the company continue to improve its financial-obligation situation and increase its international debt rating,” said the IEC’s chief executive, Eli Glickman.
In the first quarter, the company had lost 347 million shekels, compared with a 253-million-shekel loss a year earlier.