Generation Capital Reports Sharp Profit Rise and Asset Growth After Shikun & Binui Energy Deal
Generation Capital, an investment fund, reported a pre-tax profit of 826 million shekels in the second quarter of 2026 and a cumulative profit of 1.05 billion shekels for the first half of the year. This marks a significant increase compared to 132 million shekels in the same period last year. The profit surge was mainly driven by asset revaluations in PowerGen, the fund's energy arm, and BlueGen, its environmental division, which boosted the fund's investment portfolio value. The revaluation gains totaled 761 million shekels, with PowerGen's value rising by 287 million shekels, partly due to Phoenix's investment that valued the company at 3.25 billion shekels.
After the quarter ended, PowerGen signed an agreement to acquire Shikun & Binui Energy, pending regulatory approval. This deal is not yet reflected in the fund's asset valuations or forecasts. BlueGen saw a higher value increase of 474 million shekels, driven by waste management expansion, the creation of a dedicated division, merging waste activities, advancing new projects, and growing its EPC backlog to approximately 1.7 billion shekels. By the end of June, Generation Capital's investment value stood at 5.8 billion shekels, up from about 5 billion shekels at the end of the first quarter, excluding its stake in the British railway company Porterbrook, which was sold.
The fund also experienced a 70% rise in cash flow from investments, receiving 112 million shekels in the first half compared to 66 million shekels previously. Generation Capital forecasts a net cash flow of around 250 million shekels for 2026 and an average gross annual cash flow of about 370 million shekels through 2030 from existing assets. The combined EBITDA of portfolio companies reached 310 million shekels in the quarter and 615 million shekels in the half-year. Since inception, the fund's annual internal rate of return is approximately 21%, with a net asset value per share of 2.53 shekels excluding deferred taxes.
Additionally, Generation Capital declared a dividend of 25 million shekels for the seventh consecutive quarter and aims to distribute at least 100 million shekels in dividends in 2026. Recently, the fund completed a capital raise of about one billion shekels and sold Porterbrook for roughly half a billion shekels.
