Delek Group Announces Consolidated Results for the First Quarter of 2011

By Delek Group Ltd, PRNE
Sunday, May 29, 2011

TEL AVIV, Israel, May 30, 2011 -

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, 2011. The full financial statements will be available
in English on Delek Group's website at:

First Quarter 2011 Highlights

- First quarter net income of NIS 210 million compared with
net income of NIS 205 million in the first quarter of last year;

- First quarter operating profit grew to NIS 579 million, a
113% increase compared with NIS 280 million in the first quarter of last year

- Delek Group distributed a dividend of NIS 105 million in the

- Completed purchase of remaining shares of Roadchef and Delek
US acquired control of Lion Oil following quarter-end;

- Recorded a capital gain of NIS 177 million from the sale of
1.2% of the shares in Noble Energy out of a total holding of 2.7% of Noble

Group revenues for the first quarter of 2011 were NIS 13.1
, a 27% increase compared with NIS 10.3 billion in the first quarter
of 2010. The increase was primarily due to the contribution from the
downstream energy assets; Delek Europe, Delek Israel and Delek US. The
revenues in the quarter do not include the contribution of the automotive
holdings which has ceased to be consolidated following the sale of the
Company's majority stake at the end of last year.

Net income for the first quarter of 2011 totaled NIS 210
, compared with a net income of NIS 205 million in the first quarter
of 2010. Net income increased due to an improvement at the Delek US oil
refinery as well as the Oil and Gas exploration and production activities.

Group total assets as of March 31, 2011, amounted to NIS 96
, compared with NIS 92 billion as of December 31, 2010.

Commented Mr. Bartfeld, CEO of Delek Group, "In the first
quarter we continued to advance our long-term strategy by consolidating and
expanding our holdings. We completed the purchase of the remaining shares of
75% of shares in Roadchef, the motorway service station business in the UK.
We also completed the purchase of shares in Lion Oil, an 80,000 barrel per
day, high complexity refinery located in Texas. This brings Delek US'
holdings in Lion Oil to 88% of the outstanding shares. This follows our
recent transaction in Europe of the BP gas stations in France. The expansion
of our investments is a core element of our strategy and we will continue to
focus our efforts on identifying business opportunities, particularly in
energy and infrastructure, that can enhance the synergies among the
activities of our subsidiaries."

Continued Mr. Bartfeld, "The long-term success of this
strategy is clear from the significant shareholder value we have created, as
well as the large dividend distributions we issued to shareholders over the
past year. We continue to work diligently to realize the value in our
existing assets, particularly on further developing and bringing to market
the natural gas in the Tamar and Leviathan wells, while continuing further
exploration of the licenses."

Main Business Highlights

Contribution of Principal Operations to Net Income* (NIS

                                               FY      Q1     Q1            

                                             2010    2010   2011
    Oil and Gas Exploration                    64      30     79
    US Fuel Sector Operations                (213)    (42)    64
    Delek Europe                               69      16     (5)
    Israeli Fuel Sector Operations             48      24     12
    UK Service Station Sector                   -       -    (22)
    Insurance and Finance Operations          188      95     75
    Automotive operations                     195      94     32
    Others and Capital Gains                1,350     (12)   (25)
    Net Income                              1,701     205    210

* Parts of the above table have been extracted from Delek Group's First
Quarter 2011 Directors Report.

Please review the full report available on the Group's website to view the notes for each of the items above.

Energy & Infrastructure

The Oil and Gas Exploration, and Gas Production sector. The
activities in Israel are carried out through Delek Drilling LP and Avner Oil
Exploration LP which are partners in "Yam Tethys" (together with Delek
Investments LP), "Tamar", "Dalit" and "Leviathan" as well as holding
additional exploration licenses in Israel.

Yam Tethys; Following the end of the quarter, a number of
additional contracts for the Yam Tethys gas was signed; approximately $350
with Oil Refineries Ltd. ("ORL") for the supply of 1.2 BCM of natural
gas, approximately $63 million to supply Hadera Paper with an additional 0.21
BCM of natural gas, and a continuation agreement with Delek Ashkelon. Note
that the above mentioned estimated amounts are based oil and natural gas
prices on the date of signing, which may change.

Tamar; "Tamar" remains on track for production at the
beginning of 2013.

Leviathan; On May 15, the partners provided an update. During
the drilling at the "Leviathan 2" well, a flow of water was identified in the
bore hole. Due to a possible impact on the integrity and stability of the
drilling systems, the Operator decided that the particular well is not
suitable as a production well and ceased drilling. It is important to note
that the operator did not identify any hydrocarbons in the flow and believes
that the flow has no bearing on the resources of the Leviathan discovery.
Noble Energy plans to move the rig from the "Leviathan 2" well to a nearby
location to drill an alternate appraisal well and estimates that the drilling
of the new well will commence within a month and will last about 3 months.

Gas Production Summary; During the quarter, revenues from the
sale of oil and gas reached NIS 146 million compared with NIS 103 million in
the sales period, last year. The growth was due to an increase in sales price
as well as quantity of gas sold to the Israel Electric Company.

Net income from the sector for first quarter of 2011 was NIS
79 million
, as compared to a net loss of NIS 30 million in the first quarter
of 2010.

Delek US (NYSE: DK; Delek Group holds 74% end-Q1 2011):
Revenues in the first quarter of 2011 were NIS 4.1 billion compared with NIS
3.3 billion
in the first quarter of 2010. The growth was due to an increase
in the average number of barrels sold per day as well as the increase in the
price of oil during the quarter.

Net profit in the first quarter of 2011 was NIS 89 million
compared with a net loss of NIS 58 million in the first quarter of 2010.

The Gulf Coast 5-3-2 crack spread averaged $17.54 per barrel
during the first quarter 2011, versus $6.62 per barrel in the first quarter
2010. The average Gulf Coast 5-3-2 crack spread reported in the first quarter
2011 represented the highest level reached by the benchmark since the second
quarter 2007. In Delek US' retail segment, same-store merchandise sales
increased on a year-over-year basis for a seventh consecutive quarter, as
food service and private label sales initiatives continued to gain momentum.

In March 2011, Delek US increased their holdings to 88.3% of
Lion Oil, and assumed operational control and management of the Lion Oil
refinery. Lion Oil owns and operates an 80,000 barrel per day, 9.0 complexity
refinery located in El Dorado, Arkansas, as well as crude oil transportation
systems and associated product pipelines, and three light product
distribution terminals located in Memphis and Nashville, Tennessee and El
Dorado, Arkansas
. Lion Oil also owns and operates an asphalt distribution
terminal located in El Dorado, Arkansas.

Delek - the Israel Fuel Company Ltd. (TASE: DLKIS.TA; Delek
Group holds 77% end-Q1 2011): Revenues in the first quarter of 2011 were NIS
1.4 billion
compared with NIS 1.2 billion in the first quarter of last year,
representing an increase of 17%. This increase was due primarily to the
increased price of gasoline compared with that of last year, as well as an
increase in sales of gasoline for commercial enterprises, an increase in
sales at convenience stores and an increase as a result of the consolidation
for the first time of the direct marketing segment. The increase was
partially offset by the discontinuation of the consolidation of a
subsidiary's results, following its sale on January 1, 2011.

Net income in the first quarter of 2011 amounted to NIS 13
compared with a net income of NIS 33 million in the same period in
2010. The reduction in net income was mainly due to a comparative increase in
financial expenses. In the first quarter of 2010, Delek Israel received a
one-time financial income of NIS 20 million following its sale of Haifa Basic
Oils Company.

Delek Europe. Revenues in the first quarter of 2011 were NIS
4.4 billion
compared with NIS 2.78 billion in the same period last year. The
results of the first quarter 2010 do not include the activities of Delek
France which only started contributing in the fourth quarter in 2010, and
contributed NIS 1.1 billion in revenue in the quarter. Apart from the
inclusion of Delek France in the quarter, the increase in revenues were also
due to the increased price of gasoline compared with that of last year as
well as increased sales at its convenience stores. The increase was partially
balanced through the fall in average value of the Euro versus the Shekel in
the quarter.

Net loss in the quarter was NIS 5 million, compared with a net
income of NIS 16 million in the first quarter of 2010. The reduction in net
income compared with last year, was due to an increase in operating expenses
due to the increased number of gas stations operated by the company as well
as the above-mentioned weakening of the Euro versus the Israel shekel and
some one-time expenses.

Roadchef (Delek Motorway Services in the UK). The company is a
fully consolidated subsidiary of the Group and holds the 100% of the shares
of RoadChef Ltd., an operator 19 motorway services areas across the UK.
During the first quarter, Delek Motorway Services, a fully owned subsidiary
of Delek Group, acquired the remaining 75% of Roadchef's shares that it did
not already own. Following the close, Roadchef's results became fully
consolidated into the Company's results.

Roadchef's revenue in the first quarter of 2011 was NIS 244
versus NIS 247 million in the first quarter a year ago. Net loss for
Roadchef was NIS 22 million in the first quarter versus a net loss NIS 31
in the first quarter of last year.

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 75
to the Group's net income in the quarter, compared to a contribution
to net income of NIS 95 million in the same period last year.

Phoenix reported net profit amounting to NIS 112 million in
the first quarter of 2011, compared to NIS 127 million last year. Republic
Companies reported net profit amounting to US$ 3 million in the first quarter
of 2011, compared with US$ 6 million, in the first quarter of last year.

Dividend Distribution

On May 30, 2011, the Board of Directors of Delek Group
declared a cash dividend distribution for first quarter of 2011 in the amount
of approximately NIS 105 million (approximately NIS 9.2 per share) to the
shareholders on record as of June 15, 2011. The ex-date is June 16, 2011 and
the dividend will be paid on June 30, 2011.

Conference Call Details

The Company will be hosting a conference call in English on
Tuesday, May 31, 2011. Management will also be available to answer investor

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: 1-866-860-9642

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

                       ISRAEL Dial-in Number: 03-918-0664

                  INTERNATIONAL Dial-in Number: +972-3-918-0664


             8:30am Eastern Time, 1:30pm UK Time, 3:30pm Israel Time

On the call, CEO Asaf Bartfeld, CFO Barak Mashraki and Head of
Investor Relations, Dalia Black, will review and discuss the results, and
will be available to answer your questions.

About The Delek Group

Delek Group is the leading energy & infrastructure group based
out of Israel with investments in upstream & downstream energy, water
desalination and power plants globally. In addition, Delek is the number one
importer & distributor of vehicles in Israel and owns insurance assets in
Israel and the US. Earlier this year, Delek Group, through its subsidiaries,
discovered significant quantities of high quality natural gas off the coast
of Israel. Delek Group sales reached approximately 45 billion Israeli shekels
in 2010.

For more information on Delek Group please visit

Delek Group Income Statement (NIS Millions)

                                                Q1       Q1     Full Year

                                               2011     2011      2010

    Revenue                                 13,121    10,274     44,567
    Cost of revenue                         11,198     8,752     37,980
    Gross profit                             1,923     1,522      6,587

    Sales, marketing and operating expenses
    - gas stations                             963       833      3,502
    General and administrative expenses        446       396      1,772
    Other income (expenses), net                83       (13)       (88)
    Profit from operating activities           597       280      1,225

    Financing income, net                      228       156        271
    Financial expenses, net                   (468)     (269)    (1,655)
    Profit (loss) after financing              357       167       (159)

    Profit from realization of investments      (1)        -         (4)
    in associates and others, net
    Group's equity in profits (losses) of       84        69        156
    associates and partnerships, net
    Profit (loss) before income tax            440       236         (7)

    Income tax (tax benefit)                   129        56        178
    Profit (loss) from continuing operations   311       180       (185)
    Profit (loss) from discontinued
    operations                                   -       164      2,139
    Profit (loss)                              311       344      1,954

    Attributable to:
    Company shareholders                       210       205      1,701
    Non-controlling interest                   101       139        253
                                               311       344      1,954

The notes are an integral part of the financial statement and can be
found at


    Dalia Black

    Head of Investor Relations
    Delek Group
    Tel: +972-9-863-8444

    Kenny Green / Ehud Helft
    International Investor Relations
    GK Investor Relations
    Tel: (US) +1-646-201-9246


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