Elco Holdings Ltd. (TASE: ELCO), controlled by the Salkind family, finished the second quarter of 2019 with a NIS 46 million net profit, 247% more than in the second quarter of 2018. Elco's revenue totaled NIS 2.5 billion in the second quarter, 13% more than in the corresponding quarter last year.
Elco operates through three main subsidiaries listed on the Tel Aviv Stock Exchange: Electra (subcontracting and infrastructure), Electra Consumer Products (manufacturing and marketing of consumer products, plus the Golan Telecom), and income-producing real estate company Electra Real Estate. The company is also active in media and entertainment through the Globus Max chain of movie theaters.
The main cause of the improvement in Elco's profit was the activity of Electra Consumer Products, which contributed NIS 26 million, compared with a NIS 22 million loss in the corresponding quarter last year. Electra's contribution declined 0.8% to NIS 47 million. Other activity, including media and entertainment, posted a NIS 1 million loss, compared with a NIS 5 million profit in the corresponding quarter in 2018.
Elco finished the first half of 2019 with NIS 4.8 billion in revenue, 8% more than in the first half of 2018. Net profit was NIS 80 million, 175% more than in the corresponding period last year.
Electra Consumer Products contributed NIS 42 million to Elco's bottom line, compared with a NIS 10 million loss in the first half of last year. Electra's contribution was up 1% to NIS 92 million, while the contribution of Electra Real Estate totaled NIS 43 million, compared with NIS 10 million in the first half of 2018. Miscellaneous activity and the media and entertainment sector posted a NIS 3 million loss, compared with a NIS 1 million profit last year.
Elco's share price responded to the reports with a 1.5% rise, and has now risen 33% over the past year. The company's current market cap is NIS 2.4 billion.
A month ago, Elco and Azrieli signed an agreement under which Elco Media will acquire Granite Hacarmel, the controlling shareholder in Supergas, from Azrieli for an estimated NIS 770 million. Completion of the deal is expected by the end of October, with an extension option until March 2020 if needed. The deal requires several approvals, including by the Israel Competition Authority director general and the Ministry of National Infrastructure, Energy, and Water Resources.
Published by Globes, Israel business news - en.globes.co.il - on August 29, 2019
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