Shikun & Binui Announces First Quarter 2010 Results
RAMAT GAN, Israel, May 27, 2010 /PRNewswire-FirstCall/ --
- Net Income Totaled NIS 107 Million, 22% Growth Compared With Q1 2009; Gross Margin of 20%; Operating Margin of 12.5%
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 first quarter 2010, ended March 31, 2010.
"Continuing with our 2009 momentum, the first quarter of 2010 was characterized by an increase in all of the Group's growth engines. We are confident that the outcome of this activity will continue to drive positive results in the upcoming quarters," commented Mr. Ofer Kotler, Chief Executive Officer of Shikun & Binui.
Main Events of the First Quarter and Subsequent to it:
- The Group's orders backlog in the construction and infrastructure
segment totaled NIS 8.4 billion as of 31.3.10, an increase of 8%
compared with 31.12.2009.
- In May, H2ID announced that the water desalination plant in
the city of Hadera, in which the Company holds 50% of the rights,
successfully completed the State's acceptance test and began to produce
and sell water at an annual output of 105 million cubic meters.
Construction of the facility was completed before its expected time,
and came in under the construction budget.
- In May, the Group announced a cash dividend of NIS 110 million,
representing NIS 0.274 per share.
- In the first quarter of the year, Shikun & Binui Real Estate sold 344
units totaling NIS 515 million, and since the beginning of the year
until the end of April, it sold 454 units for total proceeds of NIS 673
million. In April alone, the company sold 110 units for a total of NIS
158 million. During the quarter, Shikun & Binui Real Estate sold land
in the Ramat Aviv Gimmel neighborhood at a pre-tax gain of NIS 23
million. In May, Shikun & Binui Real Estate sold property in the city
of Netanya in the "City Of Seas" neighborhood at a pre-tax gain of NIS
32 million.
- The subsidiary, Solel Boneh Israel, was awarded the tender to design,
build and maintain the Tel Aviv Hall of Justice for a 20-year period.
This Build-Operate-Transfer ("BOT") project includes the construction
of a new building, underground parking and additional projects. In
return, the company will receive a fee of NIS 165 million as well as
additional annual consideration during the agreement period.
First Quarter 2010 Results
Revenues from projects and sales totaled NIS 1.1 billion this quarter, 10% less than the first quarter of 2009. The decrease is driven by:
- Revenues from apartment occupancy in Shikun & Binui Real
Estate were at a lower volume than in the first quarter of 2009. Since
early 2009, Shikun & Binui has accelerated the pace of activity, which
will also lead to increased apartments sold in the future.
- A decrease in the revenues of Solel Boneh Israel with the
completion of the Segment 18 Project on Highway 6 in Israel.
Gross profit totaled NIS 217 million (20% of revenues), a decrease of 17.8% compared with Q1 of 2009 (21.7% of revenues). The decrease was due mainly to infrastructure and construction projects abroad (Shikun & Binui SBI Infrastructures). The gross margin of Shikun & Binui SBI Infrastructures in the first quarter of 2009 was especially high as the company received final payments and adjustments for completing a project, whereas the current quarter saw a project delayed.
General and administrative expenses totaled NIS 72 million (representing 6.6% of revenues), compared with NIS 66 million (5.4% of revenues) in Q1 of 2009. The increase was due to expenses for stock options granted to employees and to a television marketing campaign launched by the Group.
Operating income totaled NIS 136 million (12.5% of revenues), a decrease of 29% from Q1 2009 (15.8% of revenues). The decrease was due mainly to a decline in the gross profit in infrastructure and construction projects abroad. In non-allocated expenses to segments, a growth of NIS 11 million was recorded.
Financing costs net totaled NIS 13 million, compared with NIS 39 million in the first quarter of 2009. The financing expenses in Q1 2009 were driven by exchange rate fluctuations that did not have an effect during the current quarter, due to foreign currency hedges executed by the Group.
Company's share in profit losses of investee companies accounted for by the equity method totaled income of NIS 13 million, compared with a loss of NIS 24 million in Q1 2009. The income is due to the results of the foreign investees as well as an affiliate engaged in concession activity, which recognized financing income this quarter due to the erosion in the euro exchange rate.
Net income amounted to NIS 107 million, an increase of 22% over the first quarter last year.
Cash flows from operating activities totaled NIS 53 million, compared to NIS 110 million in the first quarter of 2009.
The Group does not revalue its real estate assets and it is thus stated at historical costs in the financial statements.
Shareholders' equity as of March 31, 2010 totaled NIS 616 million, compared with NIS 508 million at the end of 2009.
The Company has cash balances and equivalents totaling NIS 1.1 billion and an unutilized credit facility amounting to NIS 831 million.
Total assets amount to NIS 7.3 billion.
Doron Blachar, the Group's CFO said: "The Group is working constantly to increase its shareholders' equity. The full or partial realization of assets will expose the real value of those assets, which are recorded at their historic values on the balance sheet. I think this is a positive way to improve the Group's capital structure.
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.
Condensed Consolidated Interim Statement of Financial Position as at
March 31 March 31 December 31
2010 2009 2009
(Unaudited) (Audited)
NIS thousands NIS NIS thousands
thousands
Assets
Cash and cash equivalents 1,128,818 1,339,243 1,180,517
Bank deposits 180,919 45,144 170,226
Short-term loans and investments 68,231 47,793 63,915
Short-term loans to investee 173,468 338,782 331,304
companies
Trade receivables - accrued 749,872 868,990 872,670
income
Inventory of buildings held for 1,117,076 862,852 1,021,668
sale
Receivables and debit balances 205,981 (1) 208,850 (1) 166,744
Other investments, including 5,995 2,547 2,619
derivatives
Current tax assets 64,411 78,369 72,107
Inventory 199,524 205,326 199,234
Assets classified as held for 8,070 - 8,065
sale
Total current assets 3,902,365 3,997,896 4,089,069
Receivables in respect of
concession
arrangements 74,754 15,182 68,109
Non-current inventory of land 467,138 468,876 478,425
(freehold)
Non-current inventory of land 172,172 206,149 198,620
(leasehold)
Investment property, net 311,304 (1) 319,120 (1) 317,152
Land rights 16,560 16,501 16,975
Long-term prepaid expenses 2,208 (1) 3,765 (1) 2,868
Receivables, loans and deposits 382,536 556,447 406,653
Due from Group employees - -
Investments in equity-accounted 156,509 130,392 138,572
investees
Loans to investee companies 719,095 600,291 618,270
Deferred tax assets 114,128 142,256 116,498
Property, plant and equipment, 843,281 (1) 894,948 (1) 820,789
net
Intangible assets, net 106,700 93,814 101,459
Total non-current assets 3,366,385 3,447,741 3,284,390
Total assets 7,268,750 7,445,637 7,373,459
(1) Retrospective application, see Note 3C.
Liabilities
Short-term credit from banks and others 862,281 1,145,468 879,586
Subcontractors and trade payables 651,158 670,733 683,040
Short-term employee benefits 35,701 38,831 35,982
Payables and credit balances including 267,451 305,063 289,917
derivatives
Current tax liabilities 91,536 119,745 95,445
Provisions 343,323 311,205 303,631
Payables - customer work orders 627,868 774,505 750,958
Advances received from customers 613,156 319,046 565,072
Total current liabilities 3,492,474 3,684,596 3,603,631
Liabilities to banks and others 1,030,268 1,332,359 1,129,821
Debentures 1,907,718 1,837,117 1,912,160
Employee benefits 142,145 139,607 140,703
Deferred tax liabilities 14,124 17,646 15,299
Provisions 23,998 26,557 24,654
Excess of accumulated losses over cost of
investment and deferred credit balance
in affiliated companies 42,152 41,546 39,056
Total non-current liabilities 3,160,405 3,394,832 3,261,693
Total liabilities 6,652,879 7,079,428 6,865,324
Equity
Total equity attributable to equity
holders
of the parent company 459,190 357,638 351,003
Minority interest 156,681 8,571 157,132
Total equity 615,871 366,209 508,135
Total equity and liabilities 7,268,750 7,445,637 7,373,459
Condensed Consolidated Interim Statement of Income
For the
For the three-month year ended
period ended
March 31 March 31 December 31
2010 2009 2009
(Unaudited) (Audited)
NIS thousands NIS NIS
thousands thousands
Revenues from work performed and sales 1,088,167 1,214,071 4,453,729
Cost of work performed and sales 871,335 950,439 3,570,666
Gross profit 216,832 263,632 883,063
Gain on sale of investment property - - 10,978
Selling and marketing expenses (5,310) (5,582) (25,147)
Administrative and general expenses (72,226) (65,809) (268,704)
Other operating income 716 1,422 135,565
Other operating expenses (4,297) (1,704) (28,690)
Operating profit 135,715 191,959 707,065
Financing income 81,122 29,173 132,726
Financing expenses (94,082) (67,940) (393,437)
Net financing expenses (12,960) (38,767) (260,711)
Share of profit (losses)
of equity accounted investees (net of tax) 13,420 (24,443) (66,981)
Profit before taxes on income 136,175 128,749 379,373
Taxes on income (29,621) (41,777) (147,232)
Net profit for the period 106,554 86,972 232,141
Attributable to:
Equity holders of the parent company 103,077 88,354 237,337
Minority interest 3,477 (1,382) (5,196)
106,554 86,972 232,141
Basic and diluted earnings per share (in NIS) 0.261 0.224 0.602
Number of shares used in the computation
of
earnings per share (in thousands) 394,545 394,545 394,545
(*) Reclassified
Business Operating Segments (cont'd)
For the three month period ended March 31, 2010
Infrastructures
and Infrastructures Real estate
construction and Real estate development
outside of construction development outside of
Israel in Israel in Israel Israel Concessions
(Unaudited)
NIS thousands
Total 616,696 275,624 161,264 1,359 -
external
revenues
Inter-segment - 30,647 2,241 - -
revenues
Total 616,696 306,271 163,505 1,359 -
revenues
Segment
profit (loss)
before
income tax 114,168 845 41,788 (8,346) 23,567
(table continued)
Renewable
energy Water Other Adjustments Consolidated
(Unaudited)
NIS thousands
Total 21,177 12,047 - - 1,088,167
external
revenues
Inter-segment - - - (32,888) -
revenues
Total 21,177 12,047 - (32,888) 1,088,167
revenues
Segment
profit (loss)
before
income tax (6,710) (2,085) (6,706) (20,346) 136,175
For the three month period ended March 31, 2010
Infrastructures
and Infrastructures Real estate
construction and Real estate development
outside of construction development outside of
Israel in Israel in Israel Israel Concessions
(Unaudited)
NIS thousands
Total 605,598 326,090 254,866 1,436 -
external
revenues
Inter-segment - 23,482 1,885 - -
revenues
Total 605,598 349,572 256,751 1,436 -
revenues
Segment
profit (loss)
before
income tax 133,467 4,938 44,100 (32,056) (11,220)
(table continued)
Renewable
energy Water Other Adjustments Consolidated
(Unaudited)
NIS thousands
Total 13,741 11,566 774 - 1,214,071
external
revenues
Inter-segment - - - (25,367) -
revenues
Total 13,741 11,566 774 (25,367) 1,214,071
revenues
Segment
profit (loss)
before
income tax 1,133 (1,573) (406) (9,634) 128,749
Business Operating Segments (cont'd)
For the year ended December 31, 2009
Infrastructures
and Infrastructures Real estate
construction and Real estate development
outside of construction development outside of
Israel in Israel in Israel Israel Concessions
(Unaudited)
NIS thousands
Total 2,199,643 1,317,154 804,830 6,546 -
external
revenues
Inter-segment - 119,444 8,295 - -
revenues
Total 2,199,643 1,436,598 813,125 6,546 -
revenues
Segment
profit (loss)
before
income tax 365,997 9,206 181,112 (58,482) (43,349)
(table continued)
Renewable
energy Water Other Adjustments Consolidated
(Unaudited)
NIS thousands
Total 75,523 50,263 (230) - 4,453,729
external
revenues
Inter-segment - - - (127,739) -
revenues
Total 75,523 50,263 (230) (127,739) 4,453,729
revenues
Segment
profit (loss)
before
income tax (12,635) (6,368) (9,201) (46,907) 379,373
Company Contact:
Doron Blachar, CFO
Shikun & Binui
Tel: +972-3-630-1518
Investor Relations Contacts:
Ehud Helft / Porat Saar
GK Investor Relations
Tel: +1-646-233-2161/ +972-52-776-3687
email: [email protected]
SOURCE Shikun & Binui Ltd.
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