Government companies distributed a record NIS 5 billion in dividends in 2006

Transformation of gov't companies into mixed companies results in doubling of revenue weight.

Government and mixed companies distributed a record dividend of NIS 5 billion in 2006, while revenues of the 96 government companies rose by 10.5 percent to NIS 77.2b., of which NIS 2.9b. went into the government's coffers. According to the annual report published by the Government Companies Authority, government and mixed companies distributed a dividend of NIS 5b. out of their profits in 2006 compared with NIS 75.4 million in 2005 and NIS 140m. in 2004. The large increase in 2006 was mainly a result of the distributed dividend of NIS 3.3b. by Bazan Oil Refineries and Bezeq, which distributed a dividend of NIS 1.6b. In the first six months of 2007, government companies distributed a dividend of NIS 454m. The number of government companies including mixed companies increased at the end of 2006 to 96 from 94 at the end of 2005 and 91 at the end of 2004. Of these, 34 were business companies. At the same time, government companies made up 2.1% of gross domestic product in the years 2005 and 2006, compared with the 1.9% in 2004. The report noted that as a result of the transformation of government companies into mixed companies such as El Al and Bezeq as part of the privatization reforms, the weight of the revenues generated by this type of company nearly doubled from 13% in 2002 to 23% in 2006. Furthermore, government companies' export activities made up 9.8% of total exports in 2006 compared with 8.8% in 2005 and 8.5% in 2004. The level of investments by government companies into infrastructure development, and roads in 2006 stood at NIS 10.5b., similar to 2005.