Business in Brief: Tel Aviv Shares Pressured Lower by Declines on Wall Street

Tel Aviv shares pressured lower by declines on Wall Street ■ Cellular, internet pace a sharp drop in Bezeq third-quarter earnings ■ Netanyahu signs off on IMI takeover ■ Elbit net rises

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Dudley Devine, right, works with fellow traders on the floor of the New York Stock Exchange, on November 14, 2018.
Dudley Devine, right, works with fellow traders on the floor of the New York Stock Exchange, on November 14, 2018. Credit: AP Photo/Richard Drew, File

Tel Aviv shares pressured lower by declines on Wall Street

Tel Aviv shares finished sharply lower on Tuesday as Wall Street extended its losses. The S&P 500 index hit a three-week low on Tuesday as weak results and forecasts from a bunch of retailers fanned worries about holiday season sales and tech stocks continued to slide on concerns about iPhone sales. In Tel Aviv, the TA-35 and TA-125 indices both lost about 1.6% to end at 1,610.03 and 1,449.55 points, respectively, on turnover of 1.44 billion shekels ($390 million). Banks shares were hard hit, with Israel Discount sliding 2.65% to 12.49 shekel and Leumi 1.85% to 23.85. Bank Hapoalim got a double whammy with pressure on bank stock and news that controlling shareholder Arison Holdings was selling a 4.26% stake for 1.425 billion shekels. Gazit-Globe dropped 2.5% to 30.72 even as it swung to a small quarterly net profit of 1 million shekels for the third quarter, compared with a 185 million loss a year earlier. (TheMarker Staff)

Cellular, internet pace a sharp drop in Bezeq third-quarter earnings

Bezeq saw its third-quarter net profit plunge 27%, led by declines in its mobile phone and Internet services units. Israel’s biggest telecoms company said Tuesday that net fell to 234 million shekels ($63 million) from 322 million a year earlier, versus 255 million forecast by analysts polled by Reuters. Revenue slipped 4.7% to 2.3 billion shekels, close to forecasts. Net at Pelephone, Bezeq’s cellular subsidiary fell 75% to 6 million shekels. Bezeq said it had not received an answer from the Communications Ministry on its plan to merge its mobile phone, satellite television and Internet service provider businesses to cut costs. “We continue to believe that there is significant value to be unlocked at Bezeq and we trust that the launch of the upcoming strategic plan will help rebuild investors’ confidence and pave the way to the further re-rating of the shares,” said Barclays analyst Tavy Rosner. Bezeq shares ended down 4.2% at 4.47 shekels. (Reuters)

Netanyahu signs off on IMI takeover; Elbit net rises

As his first act as defense minister, Prime Minister Benjamin Netanyahu has signed the documents approving Elbit System’s to take over stated owned IMI Systems. The last remaining step to complete the 1.9 billion shekel ($510 million) merger between the two Israeli defense firms is for the heads of Elbit and the Government Corporations Authority to sign the final terms of the deal, which is expected to happen this week. Meanwhile, Elbit reported on Tuesday a 4% increase in third-quarter net profit, boosted by higher sales in North America and Asia as well as from its acquisition of U.S.-based Universal Avionics Systems Corporation. Elbit earned $1.50 a diluted share, up from $1.44 a year earlier, as revenues rose 12% to $895.2 million. Elbit’s order backlog, a barometer of future sales, climbed to $8.1 billion at the end of September from $7.6 billion a year earlier. Shares of Elbit finished down 0.75% at 435.90 shekels. (Hagai Amit and Yoram Gabison)

Delta shares fall as profit drops 33% due to one-time costs

Shares of Delta Galil fell on Tuesday after the apparel maker reported net profit fell by a third in the third quarter. Net income was $9.6 million, compared to $14.4 million last year, due to costs connected with closing its plant in Carmiel, and the acquisition of the French undergarments maker Eminence the company said. Discounting those factors, net was up 15% to $16.6 million as sales rose 9% year on year to $370.8 million. “During the quarter, we focused on consolidating Eminence Group, which made a strong contribution to sales in its first quarter as part of Delta Galil, while expanding our European presence,” said CEO Isaac Dabah. Delta said full-year 2018 sales were expected to reach as much as $1.5 billion, or up to 9%, from 2017. Net will range between $57 million and $60 million, an increase of 12%-18%, it said. Delta shares closed down 4% at 98.26 shekels ($26.34). (Eran Azran)

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