Generation Capital: Positive Forecast Update and Growth in Core Activities

Generation Capital published its third-quarter 2025 results, showing significant growth in cash flows and operational activity compared to the same period last year. Net cash flows from investments totaled approximately 154 million shekels in the first nine months, compared with about 75 million shekels last year. In the third quarter alone, cash flows reached approximately 90 million shekels. At the same time, the fund updated its 2025 cash-flow forecast to 220 million shekels—an increase of about 30% over the previous forecast—and its 2026 forecast to about 230 million shekels.

Profit before tax for the nine-month period amounted to approximately 182 million shekels, compared with 124 million shekels in the corresponding period, and Generation reported FFO of approximately 438 million shekels versus 383 million shekels last year. Investment value reached 4.4 billion shekels, and NAV per share rose to about 2 shekels. In addition, the quarterly dividend was updated to 20 million shekels—the fourth distribution since the beginning of the year.

In the water, desalination, and waste arm (BlueGen), revenues in the first nine months increased to approximately 1.1 billion shekels, compared with about 984 million shekels last year. EBITDA rose to 232 million shekels and FFO to 176 million shekels. During the period, progress continued on the Palmachim project, full operation commenced at the Ashdod desalination plant, and debt restructuring progressed according to the concession extension. At the same time, construction of the main waste facilities advanced, and in October the fund signed an MoU to bring Leumi Partners in as a partner in the waste arm with an investment of approximately 171 million shekels.

In the transport and public mobility segment (Bon Tour), revenues reached approximately 1.5 billion shekels, an increase of about 152 million shekels compared with the same period last year. EBITDA stood at approximately 305 million shekels and FFO at about 246 million shekels. The transportation services segment showed significant growth, driven mainly by expansion with existing customers and the addition of new clients, while the public transport segment recorded improvements in control metrics and cluster performance, along with increased revenues from higher mileage and validations.

In PowerGen, revenues for the nine months rose to approximately 1.4 billion shekels, an increase of about 20%, despite a temporary malfunction at the Sorek power plant. The northern plants and the MRC facility showed high availability, and the solar projects reported growth in operating capacity and installed megawatts. During the reporting period, approval was granted for the construction of the Reindeer power plant, which is planned to operate under the new regulatory framework. The fund noted that an updated valuation for PowerGen will be published in the year-end reports.

Erez Balasha, CEO of Generation, said: “The strong results for the third quarter reflect the intensive efforts focused on value creation, the initial contribution of several assets that have been under development in recent years, and continued growth across most activities, all of which led to a significant increase in cash flows during the reporting period. In light of the positive business developments, we have updated our cash-flow forecasts for 2025 and 2026, and we will update forecasts for the subsequent years as well. After four years in which the fund grew from its own internal resources, we completed a successful equity offering last month, which reflects the high level of confidence from major shareholders and the substantial potential investors see in Generation. Generation will continue to lead the infrastructure market, strengthen the Israeli economy, and maximize value for its investors through high returns, by developing sectors that are at the core of the economy – waste, transportation, water, and energy.”