Amidst upheaval in its management, energy company Paz Oil Company Ltd. (TASE:PZOL) today published good results for the third quarter of the year. Paz, managed by CEO Yona Fogel, benefited from higher oil and fuel prices, which pushed its quarterly revenue up to NIS 3.8 billion, 34% more than in the third quarter of last year. Operating profit posted a 33% gain to NIS 200 million, and net profit was up 51% to NIS 136 million. Sales by the Yellow chain of convenience stores totaled NIS 244 million, 6% more than in the corresponding quarter last year.
Paz finished the first nine months of the year with NIS 10.5 billion in revenue, 31% more than in the corresponding period in 2017. Operating profit grew 8% to NIS 540 million, while net profit dropped 25% to NIS 302 million.
Paz has had no controlling shareholder for the past two years, since Zadik Bino sold his shares in the company. The company has been in a state of upheaval since Sharona Novak, its CFO for the past six years, announced her resignation a month ago, a few weeks after chairperson Yitzhak Ezer resigned due to major differences of opinion with management.
When Ezer resigned in early October, he severely criticized the company's board of directors and management. He raised difficult questions about the company's corporate governance, thereby deepening the rift within the board of directors and leading the Israel Securities Authority to investigate the events that led to Ezer's resignation.
The shareholders' meeting convened two weeks after the resignation elected three new candidates recommended by investment institutions to the board of directors: former Israel air force commander and former El Al CEO Eliezer Shkedi, former Psagot chairperson Arik Steinberg, and Oded Gilat. Early next month, another shareholders' meeting will take place to select a chairperson for Paz.
In response to the reports, Leader Capital Markets analyst Yehonatan Shochat raised his target price for the Paz share from NSI 605 to NIS 670. "The quarterly results were a pleasant surprise for us. The company almost completely overcame the effect of the lower gasoline spread at filling stations," Shochat wrote.
Published by Globes [online], Israel business news - en.globes.co.il - on November 21, 2018
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