Delek Overriding Royalty Leviathan Ltd.

Condensed Interim Financial Statements as of June 30, 2022

In U.S. Dollars in thousand

Unaudited

Contents

Page

Independent Auditors' Review Report on the Financial Statements

2

Condensed Statements of Financial Position

3

Condensed Statements of Comprehensive Income

4

Condensed Statements of Changes in Equity

5-6

Condensed Statements of Cash Flows

7

Notes to the Condensed Financial Statements

8-12

1

Delek Overriding Royalty Leviathan Ltd.

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 statements of financial position as of 30 June 2022, 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(C) 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 23, 2022.

2

Delek Overriding Royalty Leviathan Ltd.

Condensed Statement of Financial Position (Dollars in thousand)

December

June 30

June 30

31

2022

2021

2021

Unaudited

Audited

Current assets

Cash and cash equivalents

466

187

205

Short-term investments

5,222

1,958

3,907

Royalties and other receivables

2,263

1,322

1,527

Total current assets

7,951

3,467

5,639

Non-current assets

Long-term investments

11,407

16,925

14,110

Loan to controlling shareholder

84,990

79,317

81,752

Assets in respect of ORRI

189,352

194,833

192,147

Deferred Taxes

1,665

932

1,333

Total non-current assets

287,414

292,007

289,342

295,365

295,474

294,981

Current liabilities

Other payables

1,331

1,293

1,615

Total current liabilities

1,331

1,293

1,615

Non-current liabilities

Debentures

174,149

170,699

172,392

Total non-current assets

174,149

170,699

172,392

Equity

Share capital

295

295

295

Share premium

127,275

127,275

127,275

Retained earnings

(7,685)

(4,088)

)6,596(

Total equity

119,885

123,482

120,974

295,365

295,474

294,981

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

August 23, 2022

Date of approval of the

Leora Pratt Levin

Tamir Polikar

financial statements

Director

Director

3

Delek Overriding Royalty Leviathan Ltd.

Condensed Statements of Comprehensive Income (Dollars in thousand)

Year

ended

Six-month period

Three-month period

December

ended June 30,

ended June 30,

31,

2022

2021

2022

2021

2021

Unaudited

Unaudited

Audited

Revenue from overriding royalties

6,964

5,742

3,784

2,904

11,361

General and administrative

expenses

408

424

204

224

910

Depletion

2,795

2,872

1,417

1,424

5,557

Operating profit

3,761

2,446

2,163

1,256

4,894

Financing expenses

)8,694(

)8,395(

)4,443(

)4,188(

)16,855(

Financing income

3,287

3,043

1,661

1,531

6,144

Loss before income tax

(1,646)

(2,906)

(619)

(1,401)

)5,817(

Tax benefit (Income tax)

557

70

399

)159(

473

Loss and total comprehensive loss

(1,089)

(2,836)

(220)

(1,560)

)5,344(

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

4

Delek Overriding Royalty Leviathan Ltd.

Condensed Statements of Changes in Equity (Dollars in thousand)

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

Share

Share

Retained

capital

premium

earnings

Total

Unaudited

Balance as at January 1,

2021 (Audited)

295

127,275

(1,252)

126,318

Total comprehensive

Loss

-

-

(2,836)

(2,836)

Balance as at June 30,

295

127,275

(4,088)

123,482

2021

Share

Share

Retained

capital

premium

earnings

Total

Unaudited

Balance as at April 1,

2022

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

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

5

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Delek Group Ltd. published this content on 24 August 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 31 August 2023 10:33:07 UTC.