Business in Brief: Tel Aviv Shares Extend Gains, but SodaStream Takes a Dip

Gazit-Globe second-quarter profit falls on drop in value of investment properties ■ Cyprus to renegotiate revenue-sharing pact with Aphrodite gas field partners ■ Delek Drilling profits rise as natural gas consumption reaches record

Daniel Birnbaum, CEO of SodaStream, speaks during a meeting with Ramon Laguarta, Elected Chief Executive Officer of PepsiCo in Tel Aviv, Israel, August 20, 2018.
REUTERS/Amir Cohen

Cyprus to renegotiate revenue-sharing pact with Aphrodite gas field partners

Cyprus appointed a committee on Tuesday to renegotiate its revenue sharing agreement for the 4.5 trillion-cubic-foot Aphrodite gas field being developed by a consortium that includes Israel’s Delek Group. Officials declined to discuss details of the talks, which come weeks before an ExxonMobil-Qatar Petroleum consortium begins drilling for gas in block 10 of Cyprus’s EEZ. “The best option is to try and find a mutually acceptable solution with the consortium so that the Aphrodite reserve is developed as soon as possible,” Energy Minister Giorgos Lakkotrypis was quoted in the Cyprus Mail as saying after the cabinet meeting. Aphrodite, whose other partners are Shell and Noble Energy of the U.S., which is Delek’s partner in the Israeli Tamar and Leviathan gas fields, lies in block 12 of Cyprus’ exclusive economic zone and it is Cyprus’s first gas finding, discovered in 2011. Delek shares ended 0.6% lower at 526 shekels ($143.93).

Delek Drilling profits rise as natural gas consumption reaches record

Delek Drilling said record consumption of natural gas produced by the Tamar field lifted second-quarter net profit 6.6% to $63 million. Revenue plunged to $92.7 million from $123.8 million a year earlier, but that was because the company sold part of its Tamar stake and the government’s share of revenues rose. “Growth in demand for Tamar’s natural gas was seen both in the electric-power and industrial sectors and from Israel and Jordan. The rise in demand is expected to continue and in 2018 natural gas consumption will reach more than 11 billion cubic meters,” the company said, adding that the Tamar partners, which include Noble Energy and Ratio, paid the state 391 million shekels ($107 million) in the first half. Meanwhile, development of the Leviathan field, in which Delek Drilling is also a partner, is about 60% complete, the company said. Shares of Dekel Drilling, which is controlled by Yitzhak Tshuva’s Delek Group, ended down 0.5% at 9.14 shekels.

Gazit-Globe second-quarter profit falls on drop in value of investment properties

Gazit-Globe, Israel’s largest property company, reported on Tuesday a drop in second-quarter profit, hurt by a lower fair-value gain of its investment properties. The company said it earned 72 million shekels ($19.7 million), excluding one-time items, compared with 371 million a year earlier. The net fair-value loss of investment property and investment property under development in the quarter was 125 million shekels, compared with a loss of 6 million a year earlier. It also posted a lower gain on financial derivatives of about 40 million shekels. Funds from operations were flat at 175 million shekels. Gazit lowered its 2018 estimate for economic FFO to a range of 689 million to 700 million shekels from 702 million to 717 million, citing an earlier than expected sale of shares in its Regency unit. As a result, it cut its estimate for economic FFO per share to 3.57 to 3.63 shekels from a mid-point of 3.68. Gazit shares rose 1.1% to close at 33.56 shekels.

Tel Aviv shares extend gains, but SodaStream takes a dip

Tel Aviv shares ended higher on Tuesday even as SodaStream pulled back a day after PepsiCo said it was buying the maker of home carbonated-water machines. The benchmark TA-35 index added 0.35% to end at 1,618.95 points, while the TA-125 rose 0.5% to 1,452.18, on turnover of 1.25 billion shekels ($340 million). SodaStream declined 0.35% to 519.70 shekels and bank shares were lower, led by declines of about 1.2% to Leumi to 23.61 and Mizrahi Tefahot to 63.60. B Communications shares rallied for a fourth day, climbing 7% to 27.48 and bringing their four-day rise to more than 18%. Clal Insurance rose 1.7% to 61.50 after reporting profit nearly doubled in the second quarter from a year ago to 112 million shekels. Victory dropped 2.3% to 42.37 after turning in an 8% drop in net to 8.6 million shekels. Satcom rose 3.6% to 1.24 on news Liquid Telecom was prepared to buy control for 1.20 a share. In foreign currency trading, the euro strangthened more than 0.6% to a representative rate of 4.207 shekels.