Ellomay Capital Ltd. (NYSE American; TASE: ELLO) reported a net profit of approximately €70.5 million for the three months ended June 30, 2026, marking a significant turnaround from a loss of approximately €8.4 million in the corresponding period of 2025. The company also reported earnings per share of $5.97. The profit was driven largely by non-operational factors, specifically a €94.8 million net profit recorded from the sale of its indirect holdings in Ellomay Luzon Energy Infrastructures Ltd. in May 2026.

Revenues for the quarter amounted to approximately €12.4 million, up from approximately €11.3 million in the three months ended June 30, 2025. For the six months ended June 30, 2026, total revenues reached approximately €21.1 million, compared to approximately €20.1 million in the first half of 2025. The increase in revenue was attributed to four solar facilities in the USA connected to the grid during late 2025 and early 2026, as well as increased production from biogas facilities in the Netherlands. These gains were partially offset by lower electricity prices in Italy and Spain.

Financial Performance Highlights

The company’s EBITDA for the three months ended June 30, 2026, surged to approximately €88.5 million, compared to approximately €3.2 million in the same period last year. This expansion reflects the inclusion of discontinued operations related to the Luzon Energy sale. Excluding this transaction, the company faced operational headwinds, with a loss from continuing operations of approximately €25 million for the six months ended June 30, 2026, compared to a loss of approximately €1.6 million in the prior year period.

Financing expenses, net, rose sharply to approximately €32.6 million for the six months ended June 30, 2026, from approximately €1 million in the same period last year. The CEO noted that approximately €24.7 million of this increase stemmed from exchange rate differences due to the 9.4% appreciation of the New Israeli Shekel (NIS) against the euro. Net of these exchange rate fluctuations, financing expenses were approximately €2.3 million. Additionally, the company utilized the proceeds from the Luzon Energy sale to repay its Series E Secured Debentures, with an aggregate repayment amount of approximately NIS 170 million (approximately €47.9 million).

What the Numbers Show

The divergence between the company's top-line growth and its bottom-line performance highlights the dominance of one-off events in the current results. While revenues grew modestly by approximately 5% year-on-year for the half, the net profit swung from a loss to a significant surplus solely due to the €83.3 million profit from discontinued operations. Conversely, continuing operations generated a loss of approximately €25 million, exacerbated by high financing costs linked to currency movements rather than core operational inefficiencies.

Balance Sheet and Cash Position

As of June 30, 2026, total assets stood at approximately €959.2 million, up from approximately €843.5 million at the end of December 2025. Cash and cash equivalents increased to approximately €113.5 million, alongside approximately €53.3 million in short-term deposits. Despite the strong asset position, net cash used in operating activities was approximately €3.7 million for the six months, compared to net cash generated of approximately €5.1 million in the prior year period, reflecting lower revenues from Italian and Spanish solar facilities and increased interest payments.

Ellomay Capital Ltd. (NYSE American; TASE: ELLO) has signed an agreement to acquire 100% of the share capital of a project company holding a ready-to-build 51.75 MW / 207 MWh (4-hour) battery energy storage system (BESS) in northern Italy. Announced on July 28, 2026, this transaction marks Ellomay’s first battery storage project in Italy, signaling its strategic entry into the country’s electricity storage market. The deal positions the company to capitalize on growing demand for grid flexibility as renewables expand in Italy’s generation mix.

The acquisition is being executed by Ellomay Luxembourg Holdings S.à r.l., the company’s Luxembourg subsidiary. Completion of the transaction is subject to the satisfaction of several conditions precedent, with a deadline for fulfilling these conditions set for the end of 2027. This structured approach aligns with Ellomay’s broader strategy of pursuing disciplined, structure-driven growth opportunities in key European markets.

Strategic Rationale and Market Entry

Ran Fridrich, CEO and Board member of Ellomay, identified battery storage as a core growth engine for the company, noting a focused effort on markets where the need for flexibility is growing fastest, primarily Spain and Italy. He described this project as an important first step in building a storage platform in Italy alongside the company’s existing renewable portfolio in the country. Fridrich emphasized that as renewables take over Italy’s generation mix, flexibility becomes the system’s scarcest resource, concentrating value in storage solutions.

Maya Shaltiel, Chief Strategy Officer of Ellomay, highlighted that storage in Italy earns across multiple markets simultaneously, including the capacity market, day-ahead and intraday trading, and grid stability services. She stated that the company examined the project in depth and valued its revenue stacking layer by layer before signing the agreement. Shaltiel indicated that Ellomay is evaluating additional project opportunities in the near term.

Existing Portfolio Context

This acquisition adds to Ellomay’s significant presence in the renewable energy and power sectors across Europe, the USA, and Israel. The company currently holds interests in approximately 335.9 MW of operating solar power plants in Spain and 51% of approximately 38 MW of operating solar power plants in Italy. Additionally, Ellomay holds 51% of solar projects in Italy with an aggregate capacity of 160 MW under construction, and solar projects in Italy with an aggregate capacity of 210 MW that have reached "ready to build" status.

Forward-Looking Statements and Risks

The press release includes forward-looking statements regarding the company’s plans and objectives, which involve substantial risks and uncertainties. These risks include the satisfaction of conditions to complete the transaction, changes in electricity prices and demand, regulatory changes, increases in interest rates and inflation, and geopolitical conflicts including those in Israel, Gaza, Iran, Russia, and Ukraine. Other factors include technical disruptions, financing availability, permit delays, and general market conditions in Israel, Spain, Italy, and the United States. Investors are cautioned not to place undue reliance on these forward-looking statements.