Isracard Reports: Fly Card Club Success and Profit Growth
The number of credit cards issued by Isracard has crossed the quarter-million mark, a jump of 200,000 new non-bank credit cards in just four months. The high recruitment rate for the Fly Card club supports the company's forecast of adding 1.2 to 1.6 billion shekels to pre-tax profit over the agreement's duration.
Revenues for Isracard, managed by Itamar Furman and controlled by the Delek Group, rose by 11% in the second quarter to 954 million shekels. The company recorded a net profit of 80 million shekels, compared to a loss of 150 million shekels in the same period last year, which had been impacted by a large one-time provision following a court ruling on VAT assessments for travelers abroad.
The impact of the Fly Card club, the credit card issued for the El Al frequent flyer program, has been significant. The number of credit cards issued by Isracard has crossed the quarter-million mark—a jump of 200,000 new non-bank credit cards in just four months. The company views this as a major strategic success. The high recruitment rate supports the company's forecast of adding 1.2 to 1.6 billion shekels to pre-tax profit during the agreement period.
At the end of last year, when the Fly Card club was managed by the credit card company CAL, the customer base stood at approximately 518,000. This means nearly half of those customers moved to Isracard within just four months.
Furthermore, the credit portfolio crossed the 13 billion shekel threshold for the first time, an increase of about 20% from the corresponding quarter last year. Isracard also recorded record growth in its business credit portfolio, which increased by about half a billion shekels, or 15%, over the half-year period.
The company stated it is implementing efficiency and cost-cutting measures expected to yield savings of tens of millions of shekels this year. Isracard is working to establish its own bank, leveraging its position as the industry leader in clearing, its extensive business credit portfolio, and its status as the only provider offering both business accounts and banking services alongside the largest private customer base in Israel.
Isracard's revenue growth in the second quarter is attributed to all areas of activity, including credit card operations, increased transaction volumes, higher net interest income, and proceeds from the sale of BuyMe. Meanwhile, expenses for credit losses jumped by just over 100% to 83 million shekels, primarily due to the significant expansion of the credit portfolio and the comparative effect of a group provision reduction recorded in the same quarter last year.
