Carso Motors, an importer of Renault and Nissan vehicles, reported a significant decline of more than 20% in the value of the public transportation company "Nativ Express", with which it entered into a partnership a little over a year ago.
This amendment was made to the value adjustment mechanism that Carso Motors agreed upon when it entered into "Nativ Express." Accordingly, Carso Motors' partner in the bus company, the Afifi family, "verbally informed the company" that in light of the updated valuation, it would invest the difference in value (NIS 20 million) in "Nativ Express" "in a manner to be determined later by the parties and in such a way that after the investment, Nativ Express would continue to be held in equal shares (50%-50%) by the parties.".
Carso Motors, managed by Itzik Weitz, noted that the accounting implications of the impairment are being studied, and an update on the subject will be provided later, if necessary.
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""Nativ Express", which was fully controlled by the Afifi family until Carasso's entry, operates clusters of public transportation lines, and operates mainly in the north of the country. As of the beginning of the year, the company operated 240 public transportation lines, using 330 buses.
Caruso's entry into "Nativ Express" was completed in August 2013, and Caruso's reports for the past year show that "Nativ Express" concluded 2013 with a loss of 730 thousand shekels, after a profit of 14 million shekels in 2012 and a loss of 21 million shekels in 2011.
Carasso and the Afifi family have been working together for several years. In 2009, the parties established a company that markets and sells Renault and Nissan vehicles in the Nazareth area, and they own a sales center and trade-in lot there. This partnership sells several hundred vehicles a year, and its profits have accumulated to about half a million shekels since its establishment.
In its main activity - selling Renault and Nissan vehicles - Carso Motors has been suffering from a slowdown in recent months, and concluded the first half of 2014 with a 71% drop in net profit to NIS 51 million.
Revenues for this period declined by 31% to 1.37 billion shekels, and revenues from the sale of new cars fell by 81% to 835 million shekels.
In the first half of the year, a negative decline of 10% in Nissan sales, which reached just over 5,300 vehicles, stood out, compared to a 4% increase in Renault vehicle sales, which accumulated to more than 4,400. Carso Motors is traded on the stock exchange at a value of approximately 1.3 billion shekels, after an annual increase of 6% in the share price.
