Menora Mivtachim: Profit rose by 10% to 785 million shekels

Menora Mivtachim concludes the second quarter with a total profit of 785 million shekels, compared to 716 million shekels in the corresponding quarter — an increase of almost 10%. The return on equity of the third-largest insurance company rose to 24.7%, compared to 24.2% last year.

The increase in profit was due, among other things, to an increase in income from insurance services, which rose to 2.2 billion shekels in the second quarter, compared to 2.1 billion shekels in the corresponding quarter — an improvement of 5%. Income from asset management fees totaled 333 million shekels in the second quarter, an increase of 14% compared to 293 million shekels in the corresponding quarter.

Menora Mivtachim's profit grew mainly in general insurance activity, which includes car and home insurance. Pre-tax profit in the sector rose by 48% to 360 million shekels, compared to 244 million shekels in the corresponding quarter. The improvement in profitability was recorded despite the decline in car insurance prices in the last year.

The management of Menora Mivtachim, under CEO Ari Kalman, explains that the improvement was due to positive developments in past claims managed by the insurance company and an improvement in compulsory insurance activity. The company also recorded an improvement in the profitability of long-term savings activity. Pre-tax profit in this activity rose by 12% and reached 174 million shekels. The increase was mainly due to the growth in the volume of managed assets, partly following the positive returns in the Israeli capital market in the last 12 months.

Menora Mivtachim operates in the credit market mainly through its holding in the company ERN. Adjusted profit from this activity totaled 64 million shekels in the second quarter, an improvement of 21% compared to the corresponding quarter. The credit portfolio totaled 9.4 billion shekels, an increase of 24% compared to the corresponding period last year.

The controlling shareholders of Menora Mivtachim Holdings are Tali Grifel and Niva Gurvich. Menora Mivtachim shares have risen by 51% in the last 12 months, compared to a 42.3% rise in the Tel Aviv Insurance and Financial Services index. The insurance company is traded at a value of 28 billion shekels.