Africa-Israel Investments Ltd. (TASE:AFIL), controlled by Lev Leviev, notified the Tel Aviv Stock Exchange this morning that it would post a loss of NIS 1.6-1.9 billion for the fourth quarter of 2015 and of NIS 1.8-1.9 billion for 2015 as a whole. The company's shareholders' equity will total NIS 1.2-1.3 billion.
Yesterday, Africa-Israel's share price jumped 14.5% for no apparent reason. So far this morning, the price is down 7.55%.
Subsidiary AFI Development, Africa Israel's investment arm in Russia, is the main cause of the projected annual loss. According to the company's notice, AFI Development will record write-downs and revaluation losses from the fall in the fair value of its investment real estate assets and its stock of work in progress mounting to $522 million before tax. A fall in fair value of the Afimall City mall in Moscow from $990 million to $686 million is included in this amount.
AFI Development estimates that it will post a loss of $470 million for the fourth quarter of 2015.
AFI Development says that the write downs and revaluation losses reflect a fall in the value of its projects because of the continuing negative macro-economic situation in Russia, which has been detrimental to the state of the Russian real estate market in general. The company estimates that it will record a fall in the value of its assets portfolio from $1.97 billion at the end of the third quarter of 2015 to $1.4 billion at the end of the fourth quarter.
Published by Globes [online], Israel business news - www.globes-online.com - on March 7, 2016
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