Zim turns to first operating profit since crisis [Globes, Tel Aviv, Israel]

Aug. 26--Israel Corporation (TASE: ILCO) posted a net profit attributable to shareholders of $157 million for the second quarter of 2010, compared with a net loss attributable to shareholders of $157 million for the corresponding quarter of 2009. Total net profit was $301 million for the second quarter, compared with a net loss of $88 million for the corresponding quarter.

Israel Corp's net profit attributable to shareholders rose to $206 million in the first half from $6 million in the first half of last year.

Second quarter revenue fell to $2.54 billion from $2.98 billion for the corresponding quarter, but first half revenue rose to $5.49 billion from $4.79 billion.

Despite the lower profit, lower cost on sales led to a 240 percent increase in gross profit to $768 million for the second quarter from $224 million for the corresponding quarter.

An important contribution to Israel Corp.'s second quarter net profit came from Zim Integrated Shipping Services Ltd., which posted a net profit of $3 million, compared with a net loss of $186 million for the corresponding quarter. Zim reported its first operating profit -- $46 million for the second quarter compared with an operating loss of $244 million for corresponding quarter -- since the outbreak of the global crisis. Revenue rose 72 percent to $933 million for the second quarter from $542 million for the corresponding quarter.

Israel Corp. attributed the turnaround at Zim "not only to the dramatic improvement in the terms of trade in the global shipping industry, but also to the streamlining and restructuring measures that Zim is undertaking."

Israel Corp. also attributed the profit to the doubling of Israel Chemicals Ltd. (TASE: ICL) net profit to $296 million for the second quarter from $152 million for the corresponding quarter; the swing to a profit of $32 million for the second quarter by Oil Refineries Ltd. (TASE:ORL) from a net loss of $8 million for the corresponding quarter a quadrupling of the net profit of Inkia Energy Ltd. to $9 million from $2 million; and a narrowing of Tower Semiconductor Ltd's (Nasdaq: TSEM; TASE: TSEM) loss to $9 million from $30 million.

Israel Chemicals' results contributed $155 million to Israel Corp.'s second quarter net profit, and Oil Refineries contributed $12 million

However, the net loss of Better Place LLC widened to $31 million for the second quarter from $18 million for the corresponding quarter. The loss was due to the expansion of the electric car venture's activity and its progress toward launch in Israel and elsewhere.

Israel Corp is controlled by the Ofer family through Millenium Investments Elad Ltd. with a 46.94 percent holding, and Bank Leumi (TASE: LUMI) owns 17.96 percent. Israel Corp's share price rose 2.1 percent in morning trading to NIS 3,098, giving a market cap of NIS 23.36 billion.

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