Shikun & Binui Announces First Quarter 2010 Results
By Shikun Binui Ltd., PRNEWednesday, May 26, 2010
Net Income Totaled NIS 107 Million, 22% Growth Compared With Q1 2009; Gross Margin of 20%; Operating Margin of 12.5%
RAMAT GAN, Israel, May 27, 2010 - 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: info@gkir.com
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: info at gkir.com
Tags: 24, Israel, May 27, Ramat gan, Shikun & Binui Ltd.