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Delek Group Announces Consolidated Results for the First Quarter of 2013.

TEL AVIV
 , city (1994 pop. 355,200), W central Israel, on the Mediterranean Sea. Oficially named Tel Aviv–Jaffa, it is Israel’s commercial, financial, communications, and cultural center and the core of its largest
, Israel, May 29, 2013 /PRNewswire/ —

Delek Group

 Ltd. (
TASE
 
: DLEKG , OTCQX: DGRLY)(hereinafter:
“Delek Group” or “The Group”) announced today its
results for the three month period ending March 31, 2013. The full
financial statements are available in English on Delek Group’s
website at: http://www.delek-group.com.

First Quarter 2013 Highlights

* First quarter
operating profit

See operating income.
 increases to
NIS
 or  , city (1991 pop. 175,391), SE Serbia, on the Nišava River. An important railway and industrial center, it has industries that manufacture textiles, electronics, spirits, and locomotives.
 908 million,
compared with NIS 549 million in the first quarter of last year, a
growth of 65%;

* Gross profit from the sale of Delek US shares was NIS 800 million
(NIS 591 million after tax);

* First quarter net income of NIS 50 million compared with net
income of NIS 110 million in the first quarter of last year (the decline
is due to the accounting treatment of sale of shares in Delek US).
Including the gross profit from the sale of Delek US shares the net
income would have been approximately NIS 641 million;

* Tamar gas field started production in March 2013;

* Karish situated off the Israeli coast was declared a natural gas
discovery;

* Declared a dividend of NIS 150 million for the quarter.

Group revenuesfor the first quarter of 2013 were NIS 17.7 billion,
at around the same level when compared with NIS 17.8 billion in the
first quarter of 2012.

Net incomefor the first quarter of 2013 totaled NIS 50 million,
compared with a net income of NIS 110 million in the first quarter of
2012. The reduction in net income was due to a high level of tax expense
in the quarter. In line with accounting rules, the tax expense generated
from the sale of Delek US shares appears as an expense in the profit and
loss statement, but because the subsidiary is still considered to be
under control of the Delek Group, the amount gained from the sale is
recognized only as an increase in the capital reserves on the balance
sheet.

On May 7, 2013, the Company completed a tender of 103,500 treasury
shares for a total of approximately NIS 97million. This increased Delek
Group’s public float of shares and it is expected to be
subsequently upgraded in the TA 25 index and the TA 100 index at a
higher weighting.

Commented Mr. Bartfeld ,
CEO

 of Delek Group, “We are
currently in a very exciting period for our gas sector; the start of
production in March at the Tamar gas field, marked an important
milestone not only for the Delek Group but for Israel as a whole. Tamar
will change the landscape of the Israeli energy market and will chart a
significant growth contribution to the Israeli economy. In addition, we
saw a significant upward revision of the estimated reserves in
Leviathan, bringing its best estimate to 19
TCF

. Furthermore, Karish,
off the Israeli coast, was recently pronounced a natural gas discovery
and the appraisal well at
Aphrodite
 , in Greek religion and mythology, goddess of fertility, love, and beauty. Homer designated her the child of Zeus and Dione.
 2 in Cyprus is due to commence in
the coming weeks.”

Mr Bartfeld continued, “We are pleased with our results of the
quarter. Our
operating income

 grew substantially though due to the
accounting treatment of our sale of Delek US shares, we recognized a tax
expense but not a corresponding income which lowered our net income in
the quarter. In the past few months, we have taken a number of important
strategic steps at Delek Group. We sold some of our holdings in Delek
Automotive as well as Delek US and took Delek Israel private. This is in
line with our strategy to become more focused on the upstream energy
sector, a sector in which we see very significant future
upside
potential

The potential price or gain that may be expected in a security or in a security average, generally stated as the dollar
 for Delek Group.”

Main Business Highlights

Contribution of Principal Operations to Net Income* (NIS
millions)

                                                              Q1     Q1
FY
                                                           2013   2012
2012
    US Fuel Sector Operations                               138    115
669
    Oil and Gas Exploration                                 (5)     11
22
    Delek Europe                                              -      1
57
    Israeli Fuel Sector Operations                            1      -
9
    UK Service Station Sector                              (21)   (25)
(16)
    Insurance and Finance Operations in Israel              138     67
150
    Insurance and Finance Operations in US                   37     6
33
    Automotive operations                                    51     54
77
    Contribution to Net Income before Capital Gains &
    Others                                                  339    229
1,001
    Others and Capital Gains                              (289)  (119)
(555)
    Net Income                                               50    110
446 

* Parts of the above table have been extracted from Delek
Group’s First Quarter 2012 Directors Report.

Please review the full report available on the Group’s website
http://www.delek-group.com to view the notes for each of the items
above.

Upstream Energy

Oil and Gas Exploration Sector Highlights.The activities in Israel
are carried out through Delek Energy Ltd., Delek Drilling LP and Avner
Oil Exploration LP, of which Delek Group has a controlling share.

Tamar, a 10 TCF natural gas discovery off the coast of Israel;After
four years of intensive investment in

infrastructure, Tamar started to deliver natural gas to the domestic
economy on March 30, 2013.

On May 26, the Company’s gas subsidiaries signed a
limited-recourse bridge loan with
JPMorgan Chase

 Bank, Citibank and
HSBC

HSBC Humane Society of Bay County  
 Bank PLC for the total amount of
USD

 300 million. In parallel, the gas
partnerships are currently preparing to refinance their loan agreement
with a consortium of foreign banks headed by HSBC Bank Plc and Barclays
Bank Plc, dated April 20, 2012.

In addition, on April 11, 2013, Israel Electric Company announced
its decision to the Tamar partners its intention to exercise its option
to increase the contractual amounts of natural gas it will consume.

Leviathan, a 19 TCF natural gas discovery off the coast of Israel
;Following the successful completion of Leviathan 4, a second appraisal
well at the beginning of March 2013, a full reservoir update report was
released on May 1, 2013, which increases the estimate of contingent
resources from 17 TCF up to a best estimate of 19 TCF.

Aphrodite, a 5.2 TCF natural gas discovery located in the Block 12
license off the coast of Cyprus ;On May 26, 2013, the Company’s gas
subsidiaries together with Noble Energy approved the drill of the
appraisal well at Aphrodite 2, which is expected to start in the coming
weeks and last for approximately four months. The budget of USD 117
million (100%) has been approved. The depth of the well is expected to
be approximately 1,750 meters and the planned final depth drilling is
approximately 5,600 meters below sea level.

Karish, a best estimate prospect of 2 TCF off the coast of Israel;On
May 22, 2013, the discovery of natural gas at the Karish 1 well was
announced. A full reservoir update report is expected to be released in
the coming months.

Gas Production Summary ;During the quarter, revenues from the sale
of oil and gas including royalties reached NIS 224 million compared with
NIS 200 million in the first quarter of 2012. The increase is mainly due
to a provision recorded in the first quarter of last year because of the
potential implications of a decline in the natural gas supply capacity
from the Mari B well as well as a decline in the effective rate of
royalties due to the State, due to the development costs of Noa and
Pinnacles reservoirs which began production in the second half of
2012.

Net loss from the sector for first quarter of 2013 was NIS 5
million, compared to a net income of NIS 11 million in the first quarter
of 2012. The decline in profit compared with last year was mainly due to
the recording of depreciation expenses on investments made in developing
Noa and Pinnacles reservoirs.

Downstream Energy

Delek US(
NYSE

: DK; Delek Group holds 37% end-Q1 2013): Revenues in
the first quarter of 2013 were a record NIS 8.6 billion compared with
NIS 8.2 billion in the first quarter of 2012. The results were
positively impacted by the refineries ability to process local
discounted oil, including oil from Midland Texas (
WTI

WTI World Tribunal on Iraq
WTI With The Idea  
) which was trading
in the first quarter at a discount of $7.80 per barrel. In addition, an
increase in the number of barrels sold at the Tyler refinery and the
ability of Delek US to purchase cheaper crude oil to the refinery in
El
Dorado

  [Span.,=the gilded man], legendary country of the Golden Man sought by adventurers in South America.
 contributed to the improvement in operating profitability of
Delek US.

Net income in the first quarter of 2013 was a record NIS 261 million
compared with a net income of NIS 169 million in the first quarter of
2012. Results were improved due to the significant contributions from
the Company’s refining segment.

During March 2013, Delek Group sold a total of 10 million shares of
Delek US shares at USD 39.5 per share, realizing accounting gains
recorded on the sale of these shares (pre-tax), amounted to NIS 788
million, and were recognized entirely as an increase in equity.
Conversely, the Company recognized tax expenses of NIS 157 million in
profit or loss.

Delek – the Israel Fuel Company Ltd.(TASE: DLKIS.TA; Delek Group
holds 100% as of April 24, 2013): The Company’s fully owned
subsidiary, Delek Petroleum, successfully completed a tender offer of
the full public float for a total of NIS 157 million. While holding 87%
of “Delek” the Israeli Fuel Company shares as at March-end, as
of April 24, 2013, Delek Petroleum holds 100%.

Revenues in the first quarter of 2013 were NIS 1.7 billion compared
with NIS 1.6 billion in the first quarter of 2012, representing an
increase of 6.5%. This increase was due primarily to the increased
average price of gasoline compared with that of last year, an increase
in the quantities sold in the direct marketing segment and an increase
in sales at the Menta convenience stores.

Net loss in the first quarter of 2013 was NIS 2 million compared
with NIS 1 million in the first quarter of 2012. Delek Israel’s
results were impacted by the lowering of fuel marketing margins at the
end of 2012 and increased provisions for doubtful debts. Delek Israel
continues
to take steps

 in order to mitigate the effects.

Delek Europe. Revenues in the first quarter of 2013 were NIS 3.6
billion compared with NIS 4.1 billion in the first quarter of 2012, a
reduction of 11%. The lower level of revenues was due to the lower
quantities of gas sold in the quarter which was offset partially by an
increase in convenience store sales.

Net income in the quarter was at the breakeven point compared with a
net income of NIS 1 million in the first quarter of 2012.

In the scope of the process to sell Delek Group’s fully owned
subsidiary, Delek Petroleum’s holdings in Delek Europe, in April
2013, Delek Petroleum received a number of Indicative Offers for its
holdings and the process is ongoing.

Roadchef(Motorway Services in the UK; Delek Group holds 100% end -Q1
2013); Roadchef’s revenue in the first quarter of 2013 was NIS 237
million versus NIS 272 million in the first quarter a year ago. Roadchef
continues to develop new sites under the Roadchef brand as well as
opening the fast food chain McDonalds at various sites. As of the first
quarter of 2013, Roadchef completed the development of 15 of the 28
service stations.

EBITDA

 for the first quarter of 2013 improved to NIS 22 million
versus NIS 15 million in the first quarter of 2012, represent an
increase of 46.7%. The improvement at EBITDA is mainly due to the
above-mentioned development program at the various sites, better
efficiency in operating sites and headquarters, as well as the
restructuring activities which have been carried out. Net loss for the
first quarter of 2013 was NIS 21 million compared with NIS 25 million in
the first quarter of 2012.

Insurance and Financial Services

The activities of this segment are primarily conducted through two
insurance companies; Israeli insurance company, Phoenix Holdings Ltd.
(TASE: PHOE), and general US insurer, Republic Companies, Inc. that is a

wholly owned subsidiary

.

The insurance and financial services sector contributed NIS 175
million to the Group’s net income in the quarter, compared to a
contribution to net income of NIS 73 million in the same period last
year, an increase of 140%.

Phoenixreported net profit amounting to NIS 252 million in the first
quarter of 2013, compared to NIS 121 million last year. Income from
management fees increased by NIS 39 million as compared to the
corresponding period of last year, due mainly to the fact that in the
first quarter of 2013, Phoenix started collecting variable management
fees on profit-sharing policies sold up to 2004, while no variable
management fees were collected in 2012. In the first quarter of 2013,
variable management fees on these policies totaled NIS 37 million.

During the quarter, Phoenix signed a cut-off agreement, ending the
relationship with a particular reinsurer and signed a new
reinsurance

 contract with another reinsurer, after the latter agreed to serve as a
reinsurer for insurance operations included under the cut-off agreement.
Consequently, Phoenix recorded a pre-tax gain of NIS 72 million.

RepublicCompanies reported a net profit of $10 million in the first
quarter of 2013, compared with $2 million, in the first quarter of last
year. Last year, there were increased weather damage losses of
approximately USD 17 million (net of reinsurance and before tax). In
addition, the realization of investments recorded increased income of
approximately USD 9 million in the first quarter of 2013.

Conference Call Details

The Company will be hosting a conference call in Englishon May 30,
2013. Management will also be available to answer investor
questions.

To participate, please call one of the following teleconferencing
numbers. Please begin placing your calls at least 5 minutes before the
conference call commences. If you are unable to connect using the
toll-free numbers, please try the international dial-in number.

US Dial-in Number: 1-888-860-9642

UK Dial-in Number: 0-800-917-9141

ISRAEL Dial-in Number: 03-918-0691

INTERNATIONAL Dial-in Number: +972-3-918-0691

At:

9:30am Eastern Time, 2:30pm UK Time, 4:30pm Israel Time

On the call, Chairman Gabriel Last, CEO Asaf Bartfeld and
CFO

 Barak
Mashraki will review and discuss the results, and will be available to
answer your questions.

About The Delek Group

The Delek Group, Israel’s dominant integrated energy company,
is the pioneering leader of the natural gas exploration and production
activities that are transforming the Eastern Mediterranean’s
Levant
  [Ital.,=east], collective name for the countries of the eastern shore of the Mediterranean from Egypt to, and including, Turkey.
 Basin into one of the energy industry’s most promising emerging
regions. Having discovered Tamar and Leviathan, two of the world’s
largest natural gas finds since 2000, Delek and its partners are now
developing a balanced, world-class portfolio of exploration, development
and production assets with total gross natural gas resources to date of
33 TCF.

Delek is Israel’s largest and sole domestic supplier of natural
gas. In addition, Delek has built an extensive network of global
downstream assets, including 1,900 gas stations and convenience stores
in the U.S., Europe and Israel; petroleum refineries in the U.S. with
140,000 barrel per day of nameplate production; and pipelines and
storage facilities in the US, Europe and Israel. Delek also holds
significant interests in leading water desalination, power generation,
insurance and automotive companies.

In 2012, the Company’s revenues were NIS 72 billion ($19
billion). Delek Group’s shares are traded on the
Tel Aviv Stock
Exchange

 (TASE: DLEKG) as part of the TA25 Index.

For more information on Delek Group please visit
http://www.delek-group.com.

Delek Group Income Statement(NIS Millions)

                                             Q1 2013 Q1 2012     2012
    Revenues                                 17,738  17,813   71,598
    Cost of revenues                         15,293  15,693   62,422
    Gross profit                              2,445   2,120    9,176
    Sales, marketing and gas station
    operating expenses                        1,009   1,013    4,182
    General and administrative expenses         515     547    2,056
    Other expenses, net                          13      11       65
    Operating profit                            908     549    2,873
    Finance income                               26      97      315
    Finance expenses                          (344)   (424)  (1,728)
    Profit after financing                      590     222    1,460
    Gain from disposal of investments in
    inveseetees and others, net                   -       -       60
    The Group's share in the profits of
    associate companies and partnerships,
    net                                         139     108      214
    Profit before income tax                    729     330    1,734
    Income tax                                  448     110      779
    Net profit                                  281     220      955
    Attributable to -
    Equity holders of the parent                 42     110      446
    Non-controlling interest                    239     110      509
                                                281     220      955 

The notes are an integral part of the financial statement and can be
found at http://www.delek-group.com

Contact

Dalia Black / Dina Vince
Investor Relations

 Delek Group
Tel

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TEL Team Deutsche Telekom
:
+972-9-863-8444 Email: investor@delek-group.com

Kenny Green / Ehud Helft International Investor Relations
CCG
 
 Investor Relations Tel: (US) +1-646-201-9246 E-mail:
delek-group-ir@ccgisrael.com