Israel Chemicals (TASE:ICL) on Monday reported an upswing in its financials, leaving the forecasts gasping in its dust.

The company reported 16% growth in sales to $523.7 million, and a 28% increase in net profit to $28.3 million.

Bank Hapoalim had predicted that ICL would end the second quarter with growth of 4% in sales to $470 million and would net $26 million. Nessuah Zannex analyst Haim Israel forecast that the company would report sales of $477 million and a net profit of $17.8 million.

In the same quarter of last year, ICL which is controlled by Israel Corporation (TASE:ILCO) and the Ofer Brothers netted $22 million, on sales of $452 million.

First-half cash flow from operations surged to $168.5 million, 83% up from the parallel half of 2001, when incoming cash was only $92.2 million.

At the end of the first quarter this year, for which the company presented 10% growth in net to $20.1 million but a 6% slide in sales to $444.6 million, ICL chief executive Akiva Mozes told TheMarker that he hoped the company had reached the U-turn. After two years of slowdown, the rally seems to have arrived.

The upswing is attributable to a combination of factors: consolidation with the British potash company CPL; rising prices in certain sectors; and the appreciation of the euro and shekel against the dollar.

This morning Mozes said that the company's results were improved by austerity measures implemented over the last three years, and rising sales after several quarters of erosion. Potash, phosphates and fire retardants all increased, he said.

The austerity measures, including a drop in management and general expenses, were evident in ICL's operating results. Operating profit shot up 55% to $68.4 million, while net profit comprised 13.1% of sales, compared with 9.8% in the parallel quarter of last year.

For the first half of 2002, ICL's net increased 20.4% from the parallel half to $48.4 million. Revenue increased to $968.3 million, from $926.8 million in the same six months of last year.

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