Shikun & Binui Reports Results for Second Quarter of 2013

          Shikun & Binui Reports Results for Second Quarter of 2013

PR Newswire

AIRPORT CITY, Israel, Aug. 25, 2013

AIRPORT CITY, Israel, Aug.25, 2013 /PRNewswire/ --

  oProjects backlog in infrastructure and construction segment totaled NIS
    11.5 billion
  oRevenues in the quarter grew by 8.3% compared with Q2 of 2012, totaling
    NIS 1.75 billion
  oGrowth of 44% in revenues of Shikun & Binui Real Estate this quarter,
    compared with Q2 of 2012, reaching NIS 518 million
  oGroup's bonds rating was upgraded to A1 with a stable outlook (Midroog)

Ofer Kotler, CEO of Shikun & Binui: "In recent months, we have posted
impressive growth in projects backlog in the infrastructure and construction
segment, we closed on the sale of our holdings in Highway 6, of which we were
one of the builders, and we achieved a significant milestone in the energy
operations."

Shikun & Binui Ltd. (TASE: SKBN.TA) ("Shikun & Binui" or the "Company"), a
member of the Arison Group and Israel's leading infrastructure and real estate
company, announced today its results for the second quarter ended June 30th,
2013.

Noteworthy events during and subsequent to the Second Quarter and Key Results:

  oThe Group's projects backlog in the infrastructure and construction
    segments totaled NIS 11.5 billion at the end of the quarter, of which NIS
    8.9 billion ($2.5 billion) originated in the Group's activities outside of
    Israel. At the end of 2012, the projects backlog totaled NIS 9.7 billion,
    of which NIS 7.1 billion ($1.9 billion) originated in the Group's
    activities outside of Israel.
  oShikun & Binui Real Estate sold 208 apartments during the second quarter
    of 2013, for a total of NIS 272 million. In the first half of 2013, 403
    units were sold for a total of NIS 538 million.
  oIn June, the Group posted several achievements:

       oThe Group closed on the sale of its holdings in "Derech Eretz"
         (Highway 6) for NIS 683 million, and will recognize a gain of NIS 63
         million in the third quarter of 2013. Solel Boneh Infrastructures
         will carry out future projects related to Highway 6 totaling NIS 470
         million.
       oShikun & Binui SBI was awarded a tender by the Nigerian government to
         build an infrastructure project totaling $580 million.
       oAn investee, in which the Group is a partner together with the
         Abengoa Group, was chosen as the winning bid in the tender for
         construction of a thermo-solar power plant in Ashalim – the largest
         BOT project in Israel, with an estimated cost of $1.1 billion. The
         project's financial closing is expected to be completed in the second
         half of 2014.

  oMidroog upgraded the rating for the Group's existing debt, and for any new
    debt raised up to a total of NIS 450 million, to a rating of A1 with a
    stable outlook. The previous rating for the Group's debt was A2.

With the approval of the financial statements for the second quarter, the
Group's board of directors approved a dividend distribution to shareholders of
NIS 60 million.

Revenues from projects carried out and sales totaled NIS 1.75 billion in the
quarter – growth of 8.3%, compared with Q2 of 2012.

Revenues of the real estate development in Israel segment, carried out by
Shikun & Binui Real Estate, grew by 44%, compared with Q2 of 2012, totaling
NIS 518 million. The growth was driven by the sale of half of the Company's
rights in the Seventh Avenue Shopping Mall in Beer Sheba and from a larger
number of built units that were occupied during the quarter (232 compared with
211 in Q2 2012).

Revenues from the Infrastructure and Construction in Israel segment, carried
out by Solel Boneh Israel, increased by 9.4%, compared with Q2 of last year,
and totaled NIS 501 million. Most of the growth was driven by the
Construction Division.

Revenues of the energy segment grew by 270% compared with Q2 last year,
totaling NIS 85 million. The increase was driven by the profit from progress
in the Group's construction of the photo voltaic power plants

Gross profit totaled NIS 306 million (17.4% of revenues), compared with NIS
350 million in Q2 of 2012 (21.5% of revenues).

The decrease in profitability and gross profitability was driven mainly by the
infrastructure and construction outside of Israel segment and by the real
estate development in Israel segment. The gross profit of the renewable
energy segment increased to NIS 22 million (25.9% of this segment's revenues),
compared with NIS 3 million (13.0% of this segment's revenues) in Q2 of 2012.

General and administrative expenses increased in the quarter by 8.1%, reaching
NIS 92 million.

Operating profit totaled NIS 203 million (11.5% of revenues), compared with
NIS 245 million (15.1% of revenues) in Q2 of 2012. The decrease was driven by
the real estate development in Israel segment, and by the infrastructure and
construction outside of Israel segment. The renewable energy segment posted
operating profit of NIS 12 million, compared with a loss of NIS 6 million in
Q2 of 2012.

Net financing costs totaled NIS 49 million, similar to Q2 of last year.

Net profit totaled NIS 96 million, compared with NIS 130 million in Q2 of
2012.

The Group does not revalue its investment properties and they are stated in
the financial statements on the basis of historical cost.

Cash flows from operating activities totaled NIS 58.8 million (negative flows)
in the quarter.

Shareholders' equity as of 30.6.13 totaled NIS 1.2 billion, compared with NIS
1.1 billion at the end of 2012.

Total assets in the balance sheet amounted to NIS 10.3 billion.

Tal Raz, the Group's CFO: "The Group is presenting net profit, favorable cash
flows from operating activities and an impressive dividend yield. We are in
the throes of the restructuring of our public debt, in the framework of which
'Midroog' upgraded the Group's debt from A2 to A1 with a stable outlook, based
on our financial strength."

Condensed results for the first half of 2013 (NIS millions):

                                     First half of 2013  First half of 2012
Revenues                             3,376               3,329
Gross profit                         622                 684
Gross margin                         18.4%               20.5%
General and administrative expenses  168                 167
Other income                         56                  4
Operating profit                     493                 508
Operating profit margin              14.6%               15.3%
Net financing costs                  (95)                (82)
Equity in losses of investees        (28)                (13)
Taxes on income                      (117)               (116)
Net profit                           253                 297

About Shikun & Binui
Shikun & Binui, a member of the Arison Group, is the leading infrastructure
and real estate company in Israel. The Group's subsidiaries have been
operating since 1924. The Group's companies have gained extensive experience
in complex construction and infrastructure projects in Israel and abroad.
Shikun & Binui Group has proven achievements in building, residential
neighborhoods, commercial and industrial buildings, as well as large-scale
transportation, infrastructure and ecological projects, water purification and
desalination and development of international projects. In addition, Shikun &
Binui also operates in the initiating, planning, construction and operation of
projects in renewable energy. Shikun & Binui is a leading, multi-faceted and
socially responsible international group that produces balance between the
business, social and environmental accomplishment. The group places emphasis
on honesty, transparency, innovation, and excellence. The group has accepted
upon itself a leadership role in creation of a sustainable and progressive
life environment.

The above noted in this release includes forward-looking statements based on
Company data, as well as Company plans and estimations based on this data. The
activity, results and other data may be substantially different in reality
given uncertainty and various risks, including those discussed under risk
factors in the Company's financial statements and Director's reports.

Company Contact:             Investor Relations Contacts:

Tal Raz, CFO                 Nava Ladin

Shikun & Binui               GK Investor Relations

Tel: +972 3 630 1518         Tel: +972-3-6074717

email: tal_r@shikunbinui.com email: nava@gk-biz.com





                                                                Shikun & Binui
                                                                Ltd.
Condensed Consolidated Interim Statement of Financial Position as at
                                  June 30        June 30        December 31

                                  2013           2012           2012
                                  (Unaudited)                   (Audited)
                                  NIS thousands  NIS thousands  NIS thousands
Assets
Cash and cash equivalents         808,772        870,303        1,478,637
Bank deposits                     232,788        162,755        393,647
Short-term loans and investments  69,650         194,272        77,763
Short-term loans to investee      26,172         94,194         9,770
companies
Trade receivables – accrued       1,605,288      1,655,944      1,325,313
income
Inventory of buildings held for   1,534,520      1,523,109      1,739,430
sale
Receivables and debit balances    368,019        317,492        329,997
Other investments, including      12,561         1,213          32,524
derivatives
Current tax assets                25,064         27,635         33,950
Inventory                         263,262        296,096        309,248
Assets classified as held for     617,039        2,326          2,326
sale
Total current assets              5,563,135      5,145,339      5,732,605
Receivables in respect of         726,389        553,343        (*)592,627
concession arrangements
Non-current inventory of land     371,721        462,723        449,650
(freehold)
Non-current inventory of land     385,278        393,175        351,485
(leasehold)
Investment property, net          542,587        363,780        397,154
Land rights                       15,474         16,119         15,850
Receivables, loans and deposits   673,930        (*)308,627     (*)351,663
Investments in equity-accounted   279,831        (*)487,946    487,395
investees
Loans to investee companies       518,727        849,756        953,487
Deferred tax assets               77,526         93,557         88,892
Property, plant and equipment,    989,997        1,160,033      1,033,513
net
Intangible assets, net            125,186        123,284        143,066
Total non-current assets          4,706,646      4,812,343      4,864,782
Total assets                      10,269,781     9,957,682      10,597,387
(*) Reclassified





                                                                Shikun & Binui
                                                                Ltd.
Condensed Consolidated Interim Statement of Financial Position as at (cont'd)
                                  June 30        June 30        December 31
                                  2013           2012           2012
                                  (Unaudited)                   (Audited)
                                  NIS thousands  NIS thousands  NIS thousands
Liabilities
Short-term credit from banks      841,323        1,100,053      1,192,471
and others
Subcontractors and trade          1,048,681      1,059,475      (*)892,761
payables
Short-term employee benefits      136,584        (*)126,259   (*)145,348
Payables and credit balances      415,023        (*)419,818   (*)484,853
including derivatives
Current tax liabilities           92,404         120,152        75,697
Provisions                        397,820        360,749        (*)393,747
Payables - customer work orders   527,992        627,894        744,996
Advances received from            884,645        784,404        887,220
customers
Dividend payable                  59,038         63,949         -
Total current liabilities         4,403,510      4,662,753      4,817,093
Liabilities to banks and others   1,848,212      1,795,670      1,636,252
Debentures                        2,504,362      2,053,117      2,698,171
Employee benefits                 81,987         (*)93,040    (*)82,142
Deferred tax liabilities          56,568         53,449         60,723
Provisions                        133,015        50,761         (*)126,230
Excess of accumulated losses
over cost of investment
and deferred credit balance in   25,661         42,074         37,489
investee companies
Total non-current liabilities     4,649,805      4,088,111      4,641,007
Total liabilities                 9,053,315      8,750,864      9,458,100
Equity
Total equity attributable to
owners
of the Company                   1,042,987      1,056,281      977,376
Non-controlling interests         173,479        150,537        161,911
Total equity                      1,216,466      1,206,818      1,139,287
Total liabilities and equity      10,269,781     9,957,682      10,597,387
(*) Reclassified





                                                                  Shikun &
                                                                  Binui Ltd.
Condensed Consolidated Interim Statement of Income
                      For the six-month     For the three-month   For the
                      period ended          period ended          year ended
                      June 30    June 30    June 30    June 30    December 31
                      2013       2012       2013       2012       2012
                      (Unaudited)           (Unaudited)           (Audited)
                      NIS        NIS        NIS        NIS        NIS
                      thousands  thousands  thousands  thousands  thousands
Revenues from work
performed and sales  3,376,168  3,328,850  1,754,703  1,620,606  6,062,875
Cost of work
performed
and sales            2,754,385  2,644,373  1,449,141  1,270,771  (1)4,879,979
Gross profit          621,783    684,477    305,562    349,835    1,182,896
Gain on sale of
investment property  -          4,902      -          503        7,253
Selling and marketing (16,744)   (18,609)   (9,827)    (10,832)   (35,038)
expenses
Administrative and
general
expenses             (168,115)  (166,769)  (92,152)   (85,239)   (1)
                                                                  (338,856)
Other operating       81,837     15,389     24,728     1,300      16,393
income
Other operating       (26,187)   (11,086)   (26,041)   (10,580)   (46,175)
expenses
Operating profit      492,574    508,304    202,270    244,987    786,473
Financing income      100,537    97,661     50,875     61,653     201,101
Financing expenses    (195,272)  (179,808)  (99,449)   (109,577)  (1)
                                                                  (334,263)
Net financing         (94,735)   (82,147)   (48,574)   (47,924)   (133,162)
expenses
Share of losses of
equity
accounted investees  (27,816)   (13,230)   (2,891)    (9,202)    (34,063)
(net of tax)
Profit before taxes   370,023    412,927    150,805    187,861    619,248
on income
Taxes on income       (117,467)  (116,336)  (54,616)   (57,689)   (1)
                                                                  (171,338)
Profit for the period 252,556    296,591    96,189     130,172    447,910
Attributable to:
Owners of the Company 228,573    278,561    85,797     120,136    (1)412,255
Non-controlling       23,983     18,030     10,392     10,036     35,655
interests
                      252,556    296,591    96,189     130,172    447,910
Basic earnings per
share
(in NIS)             0.57       0.70       0.21       0.30       1.03
Diluted earnings per
share
(in NIS)             0.57       0.70       0.21       0.30       1.03
Number of shares used
in the
computation of basic
earnings
per share (in        400,497    397,362    400,718    398,017    398,063
thousands)
Number of shares used
in the
computation of
diluted
earnings per share
(in thousands)       401,024    398,537    401,169    398,506    398,471
(1) Retrospective application of amended IAS 19, Employee Benefits





Operating
Segments
              For the six month period ended June 30, 2013
              Infrastructures  Infrastructures               Real estate
              and              and              Real estate  development               Renewable
              construction     construction     development  outside of   Concessions  energy     Water     Other  Adjustments  Consolidated
              outside of       in Israel        in Israel    Israel
              Israel
              (Unaudited)
              NIS thousands
Total
external      1,501,309        744,224          840,337      7,011        81,636       182,741    18,910    -      -            3,376,168
revenues
Inter-segment -                207,610          19           -            -            -          174       -      (207,803)    -
revenues
Total         1,501,309        951,834          840,356      7,011        81,636       182,741    19,084    -      (207,803)    3,376,168
revenues
Segment
profit (loss)
before
income tax   218,134          37,233           229,660      (29,251)     23,545       8,280      (21,055)  3,255  (99,778)     370,023





              For the six month period ended June 30, 2012
              Infrastructures  Infrastructures               Real estate
              and              and              Real estate  development               Renewable
              construction     construction     development  outside of   Concessions  energy     Water    Other    Adjustments  Consolidated
              outside of       in Israel        in Israel    Israel
              Israel
              (Unaudited)
              NIS thousands
Total
external      1,747,645        773,039          642,109      4,939        83,060       60,964     17,094   -        -            3,328,850
revenues
Inter-segment -                143,817          38           -            -            -          -        -        (143,855)    -
revenues
Total         1,747,645        916,856          642,147      4,939        83,060       60,964     17,094   -        (143,855)    3,328,850
revenues
Segment
profit (loss)
before
income tax   289,146          32,753           195,434      5,360        26,039       (13,124)   (7,713)  (1,393)  (113,575)    412,927







Operating
Segments
(cont'd)


              For the three month period ended June 30, 2013
              Infrastructures  Infrastructures               Real estate
              and              and              Real estate  development               Renewable
              construction     construction     development  outside of   Concessions  energy     Water     Other  Adjustments  Consolidated
              outside of       in Israel        in Israel    Israel
              Israel
              (Unaudited)
              NIS thousands
Total
external      717,715          407,195          518,579      3,262        12,184       85,069     10,699    -      -            1,754,703
revenues
Inter-segment -                93,782           -            -            -            -          174       -      (93,956)     -
revenues
Total         717,715          500,977          518,579      3,262        12,184       85,069     10,873    -      (93,956)     1,754,703
revenues
Segment
profit (loss)
before
income tax   94,259           11,816           85,482       (5,281)      19,435       5,799      (14,576)  3,414  (49,543)     150,805





              For the three month period ended June 30, 2012
              Infrastructures  Infrastructures               Real estate
              and              and              Real estate  development              Renewable
              construction     construction     development  outside of                energy     Water    Other  Adjustments  Consolidated
              outside of       in Israel        in Israel    Israel       Concessions
              Israel
              (Unaudited)
              NIS thousands
Total
external      806,845          379,279          360,751      2,602        39,313       23,090     8,726    -      -            1,620,606
revenues
Inter-segment -                78,837           19           -            -            -          -        -      (78,856)     -
revenues
Total         806,845          458,116          360,770      2,602        39,313       23,090     8,726    -      (78,856)     1,620,606
revenues
Segment
profit (loss)
before
income tax   119,489          24,584           119,178      (8,800)      17,443       (9,318)    (3,390)  (258)  (71,067)     187,861





Operating Segments (cont'd)
              For the year ended December 31, 2012
              Infrastructures  Infrastructures               Real estate
              and              and              Real estate  development               Renewable
              construction     construction     development  outside of   Concessions  energy     Water     Other    Adjustments   Consolidated
              outside of       in Israel        in Israel    Israel
              Israel
              (Audited)
              NIS thousands
Total
external      3,120,931        1,413,117        1,203,243    17,305       143,857      126,104    38,318    -        -             6,062,875
revenues
Inter-segment -                311,309          76           -            -            -          -         -        (311,385)     -
revenues
Total         3,120,931        1,724,426        1,203,319    17,305       143,857      126,104    38,318    -        (311,385)     6,062,875
revenues
Segment
profit (loss)
before
income tax   (*) 451,393     (*)49,755       (*)370,857  (29,773)     44,820       (35,018)   (16,740)  (2,521)  (*)(213,525)  619,248
(*)
Reclassified









SOURCE Shikun & Binui Ltd.
 
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