Israeli supermarket operator Blue Square posted a drop in first-half net income today (17 August), hurt by income tax expenses and a decrease in a gain from appreciation of investment property.

Net income for the six-month period dropped to NIS49.9m (US$12.7m) compared to NIS102.3m in the first half of 2008.

Revenues for the period to 30 June also decreased, to NIS3.61bn from NIS3.74bn in the prior year.

Supermarket same store dropped by 6.8% due to the recession in the market, increased competition and erosion of the sales prices in HD chains.

However, Blue Square said the figure was offset by the addition of ten new stores during the 12-month period and the sales of Bee Group, which increased during the 2009 period versus last year by 8.2%.

EBITDA dropped to NIS205.4m from NIS237.5m in 2008.

Operating income before financing in the first half of 2009 was NIS122m versus NIS177.2m in the previous year.