Shikun & Binui Reports Results for Second Quarter of 2013

          Shikun & Binui Reports Results for Second Quarter of 2013

  PR Newswire

  AIRPORT CITY, Israel, August 26, 2013

AIRPORT CITY, Israel, August 26, 2013 /PRNewswire/ --

  *Projects backlog in infrastructure and construction segment totaled NIS
    11.5 billion
  *Revenues in the quarter grew by 8.3% compared with Q2 of 2012, totaling
    NIS 1.75 billion
  *Growth of 44% in revenues of Shikun & Binui Real Estate this quarter,
    compared with Q2 of 2012, reaching NIS 518 million
  *Group'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:

  *The 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.
  *Shikun & 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.
  *In June, the Group posted several achievements:

       *The 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.
       *Shikun & Binui SBI was awarded a tender by the Nigerian government to
         build an infrastructure project totaling $580 million.
       *An 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.

  *Midroog 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      First half of
                                               2013               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.

                                                                       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 companies             26,172        94,194          9,770
    Trade receivables - accrued income              1,605,288     1,655,944      1,325,313
    Inventory of buildings held for sale            1,534,520     1,523,109      1,739,430
    Receivables and debit balances                    368,019       317,492        329,997
    Other investments, including derivatives           12,561         1,213         32,524
    Current tax assets                                 25,064        27,635         33,950
    Inventory                                         263,262       296,096        309,248
    Assets classified as held for sale                617,039         2,326          2,326
    Total current assets                            5,563,135     5,145,339      5,732,605

    Receivables in respect of concession arrangements 726,389       553,343     (*)592,627
    Non-current inventory of land (freehold)          371,721       462,723        449,650
    Non-current inventory of land (leasehold)         385,278       393,175        351,485
    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 investees         279,831    (*)487,946        487,395
    Loans to investee companies                       518,727       849,756        953,487
    Deferred tax assets                                77,526        93,557         88,892
    Property, plant and equipment, net                989,997     1,160,033      1,033,513
    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 and others             841,323     1,100,053     1,192,471
    Subcontractors and trade payables                 1,048,681     1,059,475    (*)892,761
    Short-term employee benefits                        136,584    (*)126,259    (*)145,348
    Payables and credit balances including derivatives  415,023    (*)419,818    (*)484,853
    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 customers                    884,645       784,404       887,220
    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 investee companies    25,661        42,074        37,489
    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                                                             (1)
    and sales                        2,754,385  2,644,373  1,449,141  1,270,771  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 expenses    (16,744)   (18,609)    (9,827)   (10,832)   (35,038)
    Administrative and general
                                                                                       (1)
    expenses                         (168,115)  (166,769)   (92,152)   (85,239)  (338,856)
    Other operating income              81,837     15,389     24,728      1,300     16,393
    Other operating expenses          (26,187)   (11,086)   (26,041)   (10,580)   (46,175)

    Operating profit                   492,574    508,304    202,270    244,987    786,473

    Financing income                   100,537     97,661     50,875     61,653    201,101
                                                                                       (1)
    Financing expenses               (195,272)  (179,808)   (99,449)  (109,577)  (334,263)

    Net financing expenses            (94,735)   (82,147)   (48,574)   (47,924)  (133,162)

    Share of losses of equity
    accounted investees (net of tax)  (27,816)   (13,230)    (2,891)    (9,202)   (34,063)

    Profit before taxes on income      370,023    412,927    150,805    187,861    619,248
                                                                                       (1)
    Taxes on income                  (117,467)  (116,336)   (54,616)   (57,689)  (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 interests           23,983     18,030     10,392     10,036     35,655

                                       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 thousands)           400,497    397,362    400,718    398,017    398,063

    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
                                         and   Infrastructures                 Real estate
                                construction               and   Real estate   development
                                  outside of      construction   development    outside of
                                      Israel         in Israel     in Israel        Israel
                                                         (Unaudited)
                                                        NIS thousands

    Total external revenues        1,501,309           744,224       840,337         7,011
    Inter-segment revenues                 -           207,610            19             -

    Total revenues                 1,501,309           951,834       840,356         7,011

    Segment profit (loss) before
    income tax                       218,134            37,233       229,660      (29,251)

    TABLE CONTINUED BELOW...

                                          Renewable
                             Concessions  energy     Water  Other  Adjustments Consolidated

                                                    (Unaudited)
                                                   NIS thousands

    Total external revenues       81,636  182,741   18,910       -           -    3,376,168
    Inter-segment revenues             -        -      174       -   (207,803)            -

    Total revenues                81,636  182,741   19,084       -   (207,803)    3,376,168

    Segment profit (loss) before
    income tax                    23,545    8,280 (21,055)   3,255    (99,778)      370,023

                                       For the six month period ended June 30, 2012
                             Infrastructures
                                         and   Infrastructures                 Real estate
                                construction               and   Real estate   development
                                  outside of      construction   development    outside of
                                      Israel         in Israel     in Israel        Israel
                                                           (Unaudited)
                                                          NIS thousands

    Total external revenues        1,747,645           773,039       642,109         4,939
    Inter-segment revenues                 -           143,817            38             -

    Total revenues                 1,747,645           916,856       642,147         4,939

    Segment profit (loss) before
    income tax                       289,146            32,753       195,434         5,360

    TABLE CONTINUED BELOW...

                                         Renewable
                            Concessions  energy     Water  Other  Adjustments Consolidated

                                                   (Unaudited)
                                                  NIS thousands

    Total external revenues      83,060    60,964  17,094       -           -    3,328,850
    Inter-segment revenues            -         -       -       -   (143,855)            -

    Total revenues               83,060    60,964  17,094       -   (143,855)    3,328,850

    Segment profit (loss) before
    income tax                   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
                                         and   Infrastructures                 Real estate
                                construction               and   Real estate   development
                                  outside of      construction   development    outside of
                                      Israel         in Israel     in Israel        Israel
                                                            (Unaudited)
                                                           NIS thousands
    Total external revenues          717,715           407,195       518,579         3,262
    Inter-segment revenues                 -            93,782             -             -

    Total revenues                   717,715           500,977       518,579         3,262

    Segment profit (loss) before
    income tax                        94,259            11,816        85,482       (5,281)

    TABLE CONTINUED BELOW...

                                         Renewable
                             Concessions energy     Water  Other  Adjustments Consolidated

                                                    (Unaudited)
                                                   NIS thousands

    Total external revenues       12,184   85,069   10,699     -            -    1,754,703
    Inter-segment revenues             -        -      174     -     (93,956)            -

    Total revenues                12,184   85,069   10,873     -     (93,956)    1,754,703

    Segment profit (loss) before
    income tax                    19,435    5,799 (14,576) 3,414     (49,543)      150,805


                                     For the three month period ended June 30, 2012
                             Infrastructures
                                         and   Infrastructures                 Real estate
                                construction               and   Real estate   development
                                  outside of      construction   development    outside of
                                      Israel         in Israel     in Israel        Israel
                                                           (Unaudited)
                                                          NIS thousands
    Total external revenues          806,845           379,279       360,751         2,602
    Inter-segment revenues                 -            78,837            19             -

    Total revenues                   806,845           458,116       360,770         2,602

    Segment profit (loss) before
    income tax                       119,489            24,584       119,178       (8,800)

    TABLE CONTINUED BELOW...

                                         Renewable
                             Concessions energy     Water  Other  Adjustments Consolidated

                                                    (Unaudited)
                                                   NIS thousands

    Total external revenues       39,313    23,090   8,726     -           -    1,620,606
    Inter-segment revenues             -         -       -     -    (78,856)            -

    Total revenues                39,313    23,090   8,726     -    (78,856)    1,620,606

    Segment profit (loss) before
    income tax                    17,443   (9,318) (3,390) (258)    (71,067)      187,861


    Operating Segments (cont'd)

                                          For the year ended December 31, 2012
                             Infrastructures
                                         and   Infrastructures                  Real estate
                                construction               and    Real estate   development
                                  outside of      construction    development    outside of
                                      Israel         in Israel      in Israel        Israel
                                                            (Audited)
                                                          NIS thousands

    Total external revenues        3,120,931         1,413,117      1,203,243        17,305
    Inter-segment revenues                 -           311,309             76             -

    Total revenues                 3,120,931         1,724,426      1,203,319        17,305

    Segment profit (loss) before
    income tax                   (*) 451,393         (*)49,755     (*)370,857      (29,773)

    TABLE CONTINUED BELOW...

                                         Renewable
                             Concessions energy     Water  Other  Adjustments Consolidated

                                                    (Unaudited)
                                                   NIS thousands

    Total external revenues      143,857   126,104  38,318      -           -    6,062,875
    Inter-segment revenues             -         -       -      -   (311,385)            -

    Total revenues               143,857   126,104  38,318      -   (311,385)    6,062,875

    Segment profit (loss) before
    income tax                    44,820  (35,018)(16,740)(2,521)(*)(213,525)      619,248

    (*) Reclassified

Company Contact: Tal Raz, CFO Shikun & Binui Tel: +972-3-630-1518 email:
tal_r@shikunbinui.com

Investor Relations Contacts: Nava Ladin GK Investor Relations Tel:
+972-3-6074717 email: nava@gk-biz.com