search
Front > News

Pensions costs push IEC to heavy losses

30 May, 2012 10:30
שלח תגובה במיילGlobes' correspondent

A NIS 1.5 billion pension provision and higher fuel costs saw IEC lose NIS 1.47 billion in the first quarter.

Israel Electric Corporation (IEC) (TASE: ELEC.B22) posted a net loss of NIS 1.47 billion for the first quarter of 2012, compared with a net profit of NIS 147 million for the corresponding quarter of 2011. The utility reported an extraordinary NIS 1.5 billion expenses for pension liabilities, due to the new labor contract, which links pensions to the Consumer Price Index (CPI).

Revenue rose 25% to NIS 6.52 billion for the first quarter from NIS 5.21 billion for the corresponding quarter. Higher electricity tariffs boosted revenue by NIS 800 million, and higher electricity sales added another NIS 509 million. Operating loss was NIS 1.46 billion for the first quarter compared with an operating profit of NIS 647 million for the corresponding quarter.

IEC's expenditure on fuel more than doubled to NIS 5.1 billion for the first quarter from NIS 2.22 billion for the corresponding quarter. The higher costs are due to the halt in natural gas deliveries from Egypt and lower deliveries from the Israeli Yam Tethys field, forcing the utility to buy more expensive diesel.

Cash flow from operations was minus NIS 1 billion for the first quarter.

First quarter electricity sales rose 25% to 13.84 billion kilowatt/hours from 12.6 billion kilowatt/hours in the corresponding quarter. Peak demand reached 11,09 megawatts in January, of which IEC supplied 10.62 megawatts, and private power producers supplied 466 megawatts. Peak demand in the corresponding quarter was 9,275 megawatts in February 2011, of which IEC supplied 9,395 megawatts.

Last week, IEC announced that the government will back a NIS 3 billion debt offering by the utility, scheduled for July, due to its deteriorating financial situation.

Published by Globes [online], Israel business news - www.globes-online.com - on May 30, 2012

© Copyright of Globes Publisher Itonut (1983) Ltd. 2012

groundcover founders credit: Yossi Yarom Israeli observability co groundcover raises $35m

groundcover has developed a “Bring Your Own Cloud” (BYOC) observability solution, redefining the architecture of a modern observability platform.

Tel Aviv Stock Exchange credit: Shutterstock MagioreStock Foreign investment in TASE hits five-year high

Foreign investors have been flocking to the Tel Aviv Stock Exchange in recent weeks, the TASE research department tells "Globes."

Elbit Systems tank turret systems credit: Elbit Systems Elbit Systems wins $100m tank turret systems deal

The Israel defense electronics company will supply its advanced UT30 MK2 unmanned turret systems to General Dynamics European Land Systems (GDELS) to be supplied to a NATO European country.

Tomer Weingarten Photo: PR Trump targets SentinelOne exec in act of revenge

The US administration has suspended the security clearance of the company's chef intelligence and public policy officer Chris Krebs and everyone associated with him.

Tel Aviv Stock Exchange share prices rising credit: Tali Bogdanovsky TASE opens sharply higher after Trump U-turn on tariffs

The pause is being interpreted as a climb down after US President Donald Trump admitted he had made the move to calm the markets.

Ashot Ashkelon credit: Ministry of Defense Up 250%, Ashot Ashkelon wins another Defense Ministry order

The Israeli defense company's share price has risen 250% in the past three years since FIMI Opportunity Funds acquired control.

Liad Agmon credit: Eyal Izhar Insight Partners Liad Agmon steps down as managing partner

Serial entrepreneur Agmon has served as a partner at Insight Partners Israel alongside Daniel Aronovitz who set up the Israel office.

Shekels credit: Shutterstock Vladerina32 Shekel slide resumes amid escalating tariff war

The Bank of Israel is not expected to intervene in the forex market despite the sharp depreciation of the shekel.

Nir Zuk credit: Inbal Marmari Palo Alto Networks mulls buying AI security co for $700m

Sources inform "Globes" that on Palo Alto's radar is Protect AI.

President Donald Trump hosts Prime Minister Benjamin Netanyahu credit: Reuters Kevin Mohatt Israeli officials confident on US tariff concessions

Senior Israeli figures believe that concessions could be tied to progress on strategic regional political issues that are important to President Trump.

Phoenix Investment House CEO Avner Hadad credit: Tommy Harpaz "The market has priced in all the bad things"

Phoenix Investment House CEO Avner Hadad says US markets could continue to fall, but that we are close to interesting territory for patient investors.

Tel Aviv credit: Shutterstock Tel Aviv slips in World's Wealthiest Cities ranking

Tel Aviv's position as one of the world's wealthiest cities took a big knock over the past year as it slipped from 42nd to 48th in investment advisors Henley & Co.'s "World's Wealthiest Cities" Top 50 ranking.

Leviathan platform credit: Albatross C'ttee seen recommending no cut in gas exports

The Dayan committee on the future of the gas sector estimates that Israel's natural gas reserves will run out in 2045.

Accountant General Yali Rothenberg credit: Rafi Kutz Israel's fiscal deficit continues to narrow

The deficit narrowed in the twelve months to the end of March 2025, for the sixth consecutive month, Ministry of Finance accountant general Yali Rothenberg reported today.

Arkia credit: Arkia Arkia cuts Tel Aviv - New York April fares

Arkia has cut fares at the last minute, a time when prices usually soar even higher, according to the pricing method used in the industry.

Bank of Israel Governor Prof. Amir Yaron credit: Dani Shem Tov Knesset Spokesperson BoI Governor: US tariffs could push up inflation in Israel

Prof. Amir Yaron tells "Globes" that there is a risk that the new tariffs will cause inflation to rise in the US, with a knock-on effect for Israel.

Twitter Facebook Linkedin RSS Newsletters גלובס Israel Business Conference 2018