Delek Overriding Royalty Leviathan Ltd.

Condensed Interim Financial Statements as of June 30, 2023

In U.S. Dollars in thousand

Unaudited

Contents

Page

Independent Auditors' Review Report on the Financial Statements

2

Condensed Interim Statements of Financial Position

3

Condensed Interim Statements of Comprehensive Income

4

Condensed Interim Statements of Changes in Equity

5-6

Condensed Interim Statements of Cash Flows

7

Notes to the Condensed Interim Financial Statements

8-12

1

A Review Report of the Independent Auditor to the shareholders of

Delek Overriding Royalty Leviathan Ltd.

Introduction

We have reviewed the accompanying financial information of Delek Overriding Royalty Leviathan Ltd. ("the Company"), which includes the condensed statement of financial position as of 30 June 30,2023 and the related condensed statements of comprehensive income, changes in equity and cash flows for the periods of six and three months ended on that date. The board of directors and management are responsible for the preparation and presentation of this interim financial information in accordance with IAS 34 "Interim Financial Reporting". Our responsibility is to express a conclusion on this interim financial information based on our review.

Scope of review

We conducted our review in accordance with Review Standard (Israel) 2410 of the Institute of Certified Public Accountants in Israel "Review of Interim Financial Information Performed by the Auditor of the Entity". A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards in Israel and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Basis of Qualified Conclusion

As described in note 3(E) to the condensed financial statements, the loan granted to the controlling shareholder during 2020 (and which did not form any part of the assets that guarantee the repayment of the debentures) was not measured on its grant date at fair value as required under International Financial Reporting Standards.

Qualified Conclusion

Based on our review, with the exception of the matter described in the preceding paragraph, nothing has come to our attention that causes us to believe that the abovementioned financial information is not prepared, in all material respects, in accordance with IAS 34.

Brightman Almagor Zohar & Co.

Certified Public Accountants

A Firm in the Deloitte Global Network

Haifa, August 22, 2023.

2

Delek Overriding Royalty Leviathan Ltd.

Condensed Interim Statements of Financial Position (Dollars in thousand)

June 30

June 30

December 31

2023

2022

2022

Unaudited

Audited

Current assets

Cash and cash equivalents

290

466

304

Short-term investments

18,779

5,222

18,346

Loan to controlling shareholder

91,192

-

87,736

Royalties and other receivables

2,605

2,263

2,589

Total current assets

112,866

7,951

108,975

Non-current assets

Long-term investments

-

11,407

-

Loan to controlling shareholder

-

84,990

-

Assets in respect of ORRI

184,128

189,352

186,381

Deferred Taxes

581

1,665

900

Total non-current assets

184,709

287,414

187,281

297,575

295,365

296,256

Current liabilities

Debentures

177,953

-

176,015

Other payables

1,618

1,331

1,322

Total current liabilities

179,571

1,331

177,337

Non-current liabilities

Debentures

-

174,149

-

Total non-current assets

-

174,149

-

Equity

Share capital

295

295

295

Share premium

127,275

127,275

127,275

Retained earnings

(9,566)

(7,685)

(8,651)

Total equity

118,004

119,885

118,919

297,575

295,365

296,256

The accompanying notes are an integral part of the condensed interim financial statements.

August 22, 2023

Date of approval of the

Leora Pratt Levin

Tamir Polikar

financial statements

Director

Director

3

Delek Overriding Royalty Leviathan Ltd.

Condensed Interim Statements of Comprehensive Income (Dollars in thousand)

Year

Three-month

ended

Six-month period

period ended June

December

ended June 30,

30,

31,

2023

2022

2023

2022

2022

Unaudited

Unaudited

Audited

Revenue from overriding royalties

6,842

6,964

3,212

3,784

15,216

General and administrative

expenses

398

408

190

204

828

Depletion

2,253

2,795

1,057

1,417

5,766

Operating profit

4,191

3,761

1,965

2,163

8,622

Financing expenses

(8,868)

)8,694(

(4,416)

)4,443(

(17,153)

Financing income

3,967

3,287

2,012

1,661

6,839

Loss before income tax

(710)

(1,646)

(439)

(619)

(1,692)

Tax benefit (Income tax)

(205)

557

(81)

399

(363)

Loss and total comprehensive loss

(915)

(1,089)

(520)

(220)

(2,055)

The accompanying notes are an integral part of the condensed interim financial statements.

4

Delek Overriding Royalty Leviathan Ltd.

Condensed Interim Statements of Changes in Equity (Dollars in thousand)

Share

Share

Retained

capital

premium

earnings

Total

Unaudited

Balance as at January

1, 2023 (Audited)

295

127,275

(8,651)

118,919

Total comprehensive

loss

-

-

(915)

(915)

Balance as at June 30,

295

127,275

(9,566)

118,004

2023 (Unaudited)

Share

Share

Retained

capital

premium

earnings

Total

Unaudited

Balance as at January

1, 2022 (Audited)

295

127,275

(6,596)

120,974

Total comprehensive

loss

-

-

(1,089)

(1,089)

Balance as at June 30,

295

127,275

(7,685)

119,885

2022 (Unaudited)

Share

Share

Retained

capital

premium

earnings

Total

Unaudited

Balance as at April 1,

2023 (Unaudited)

295

127,275

(9,046)

118,524

Total comprehensive

loss

-

-

(520)

(520)

Balance as at June 30,

295

127,275

(9,566)

118,004

2023 (Unaudited)

Share

Share

Retained

capital

premium

earnings

Total

Unaudited

Balance as at April 1,

2022 (Unaudited)

295

127,275

(7,465)

120,105

Total comprehensive

loss

-

-

(220)

(220)

Balance as at June 30,

295

127,275

(7,685)

119,885

2022 (Unaudited)

5

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Delek Group Ltd. published this content on 31 August 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 31 August 2023 08:03:06 UTC.