TEL AVIV, May 30 (Reuters) - Israeli real estate developer Africa Israel Investments reported a drop in first-quarter net profit due to a decline in financing income and higher tax expenses.
Africa Israel posted on Wednesday quarterly net profit of 10 million shekels ($2.6 million), compared with 51 million in the same period a year earlier. Revenue jumped 64 percent to 2.3 billion shekels.
In the year-ago quarter the company recorded financing income of 98 million shekels related to rights in Alon USA .
Africa Israel, controlled by billionaire diamond dealer Lev Leviev, was hit hard by the real estate meltdown in the United States, Russia and eastern Europe. The company ultimately defaulted on a series of bonds in 2010, forcing it to restructure about $2 billion of debt.
Its net outstanding debt has fallen to 3.4 billion shekels, or about $879 million, from 3.9 billion at the end of 2011.
Chief Executive Izzy Cohen said the company continues to strengthen its financial structure by reducing its debt and is planning early redemption of 500 million shekels worth of debt.
"We believe these measures will lead in the future to savings in financing expenses ... and a rise in the company's credit rating," he said.
Africa Israel owns 71 percent of AFI Development, a Russia-focused real estate company.