DELEK GROUP (DLEKG) Q2 2024 earnings summary

Executive summary

• Q2 2024 net income was ₪382m vs ₪406m year over year; H1 net income attributable to shareholders was ₪651m vs ₪967m, mainly reflecting lower North Sea contribution.

• H1 revenue was ₪5.479bn vs ₪6.141bn, and operating income was ₪2.102bn vs ₪3.268bn.

• Equity was ₪10.002bn at June 30, 2024; net financial debt was ₪2.9bn.

• NewMed and Ithaca distributed or declared $419m in dividends in H1, of which ~ $310m was attributable.

Financial highlights

• Q2 revenue was ₪2.5bn; Q2 gross profit was ₪1.039bn vs ₪1.669bn year over year.

• H1 gross profit was ₪2.386bn vs ₪3.595bn; finance expense was ₪824m vs ₪1.031bn and income tax expense was ₪602m vs ₪1.151bn.

• Consolidated cash, cash equivalents and short-term investments totaled ₪3.4bn at June 30; total assets were ₪45.2bn and liabilities ₪29.5bn.

• Separate-company equity was ₪10.002bn, equal to 66% of total assets; all bond-covenant tests were met.

• A ₪54m fair-value gain on the Phoenix seller loan was recorded in discontinued operations, including ₪47m in Q2.

Segment performance

• Israel and nearby markets: H1 revenue net of royalties was ₪1.802bn vs ₪1.656bn; operating profit was ₪1.273bn vs ₪1.154bn and attributable net profit was ₪530m vs ₪419m.

• Leviathan sales were 5.4 BCM in H1 vs 5.3 BCM; average price rose to $6.23/MMBTU from $6.11. H1 sales: Egypt 3.6 BCM, Jordan 1.2 BCM and Israel 0.6 BCM.

• North Sea H1 revenue was $842m vs $1.248bn, EBITDAX $533m vs $980m and production 9.6m boe vs 13.7m boe; outages and maintenance reduced output.

• Ithaca Q2 EBITDAX was $194m vs $462m year over year; net financial debt was $506m and net debt/EBITDAX was 0.4x at June 30.

• NewMed Q2 revenue was ₪962m vs ₪794m; attributable net income was ₪286m, up 53%, and EBITDAX was ₪790m vs ₪648m.