Going Concern Warning For Africa Israel

Africa Israel reported as second quarter loss of NIS 163 million.

Africa-Israel Investments Ltd. (TASE:AFIL) reported its results for the second quarter of 2016 today.

The financial statements have a going concern qualification appended to them.

The company’s auditors state, “Not all the adjustments have been included relating to the values of assets and the liabilities and their classification that might be required in the event that the company cannot continue to operate as a going concern.”

Africa Israel, controlled by Lev Leviev and run by Avraham Novogrocki, reports a loss attributable to shareholders for the second quarter of NIS 163 million, which compares with NIS 178 million in the corresponding quarter of 2015. The overall loss is NIS 189 million, comparted with NIS 225 million in the corresponding quarter.

Revenue totaled NIS 1.7 billion, which compares with NIS 1.4 billion in the corresponding quarter.

Revenue from letting and operating assets totaled NIS 153 million, compared with NIS 181 million in the corresponding quarter. Revenue from construction and land deals totaled NIS 1.1 billion, compared with NIS 702 million in the corresponding quarter.

Africa Israel posted an operating loss of NIS 17 million for the second quarter of 2016, which compares with an operating loss of NIS 47 million in the fourth quarter.

Lev Leviev seeks to buy Africa Israel’s 65% holding in its Russian real estate arm AFI Development for NIS 550 million.

The company says it will recognize a loss of NIS 2.4 billion and a reduction of NIS 1.3 billion in shareholders’ equity in the third quarter on account of the sale.

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