Shikun & Binui Announces Fourth Quarter and Full Year 2009 Results

By Shikun Binui Ltd., PRNE
Tuesday, March 23, 2010

Gross Profit for Year 2009 Totaled NIS 883 Million, with Growth of 32% Compared with 2008

RAMAT GAN, Israel, March 24, 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 fourth quarter
and full year 2009 ended December 31, 2009.

"We are summarizing a year of prosperous and profitable
activity in all of the Group's growth engines. A wealth of experience in our
growth engines, focus and professionalism combined with financial strength,
will enable us to continue implementation of the strategy and creation of
value for the Group's shareholders," commented Mr. Ofer Kotler, Chief
Executive Officer of Shikun & Binui. "Our sustainability vision will continue
to serve as a central growth driver to our operations. We believe that our
unique investment in creating a leading position in the sustainability world
will create real value for the Group going forward."

As of January 1, 2009 the Company started recording its
results based on the following business segments: Infrastructure and
construction outside of Israel, Infrastructure and construction in Israel,
Real Estate Development in Israel, Real Estate Development outside of Israel,
Concessions, Environment and Others.

Main Events of the Fourth Quarter and Subsequent to it:

    - As part of the Group's strategy to leverage its ability to
      enter new markets, the Group, through the subsidiary (100%) Shikun &
      Binui SBI Infrastructure, commenced operations in a new country in
      which it had not operated until now: Azerbaijan. In this country,
      Shikun & Binui SBI Infrastructure signed a $337 million contract to
      design, rehabilitate and pave a 156-kilometer highway. The contract
      period is estimated at three years.

    - The Group, through its subsidiary (100%) Shikun & Binui SBI
      Infrastructure, signed a $230 million contract in Guatemala, to design,
      pave and maintain a 300-kilometer highway in the north of the country
      - Franja Transversal Del Norte. The work will continue for 3.5 years,
      and the Company will maintain the highway for ten subsequent years.

    - The subsidiary (100%) Shikun & Binui SBI Infrastructure,
      paid a dividend of NIS156 million in the fourth quarter and a dividend
      total of NIS 770 million in 2009 to the Company.

    - The Group, through a subsidiary, (100%) Solel Boneh Israel
      won the Ma'atz tender to rehabilitate, operate and maintain roads in
      Israel for twenty years, by the PFI method. The total payments expected
      over the life of the project are estimated at NIS 1.3 billion.

    - The Group, through the subsidiary (100%) Solel Boneh Israel
      was awarded the tender to design, build and maintain the Tel Aviv Hall
      of Justice for a 20-year period. The BOT project includes the
      construction of a new building, underground parking and additional
      projects. In consideration for construction of the building, the company
      will receive a construction grant of NIS 165 million; in addition, for
      the 20 years of maintenance.

    - The Group's orders backlog in the construction and infrastructure
      segment totals NIS 7.8 billion as of 31.12.09, an increase of
      26% compared with 2008.

    - In 2009, Shikun & Binui Real Estate sold in Israel 931
      housing units totaling NIS 1,104 million. In the fourth quarter,
      Shikun & Binui Real Estate sold 210 housing units totaling
      NIS 249 million.

    - Shikun & Binui Real Estate is a leader in the field of green
      construction in Israel, as part of the Shikun & Binui Group's strategy
      to create a sustainable environment. The Company is the first to obtain
      certification from the Standards Institute for "Green Buildings"
      (Israel Standard Certification 5281 for green buildings with reduced
      damage to the environment) in the "Pure Netanya East" and "Carcour
      Dreams" projects. The company expects to get premium prices over the
      long term due the unique investment and leadership in building a
      sustainable environment.

    - Receipt of the green certification from the Standards
      Institute constitutes an additional milestone for solidification of
      Shikun & Binui Real Estate's position as a leader, advancing the field
      of green construction in Israel.

    - The subsidiary Shikun & Binui Real Estate allotted to
      institutional investors 12.946% of its share capital in consideration
      for NIS 290 million. This allotment reflects an after-the-money value
      for Shikun & Binui Real Estate of NIS 2.25 billion and a profit of
      130 million NIS for the group.

    - The Group, through the subsidiary Shikun & Binui Environment (100%),
      signed several agreements for options for the purchase and rental of
      properties and roofs for the purpose of building a solar farm in
      moshavim and kibbutzim, at a future investment of NIS 600 million.
      These agreements realize the Group's strategy of leadership in the
      field of renewable energy in Israel and worldwide.

    - The Group successfully completed an offer to exchange Series
      2 debentures for Series 4 debentures. 40% of the total Series 2
      debentures outstanding were exchanged, in consideration for NIS
      492 million par value of Series 4 debentures.

Fourth Quarter 2009 Results

Revenues from projects and sales totaled NIS 1.1 billion,
similar to the fourth quarter of 2008.

Gross profit totaled NIS 210 million (19.2% of revenues),
growth of 52% compared with Q4 of 2008 (12.3% of revenues). The growth was
driven mainly by the real estate development in Israel segment - growth of
86% in gross profit - resulting mainly from the sale of land. Gross profit of
the infrastructure and construction outside of Israel segment rose by 11%, as
a result of the completion of projects and the settling of final accounts, as
well as an increase of 31.2% in the gross profit of the infrastructure and
construction in Israel segment.

General and administrative expenses totaled NIS 81 million,
representing 7.4% of sales.

Operating income totaled NIS 233 million, compared with NIS 56
million
in the fourth quarter of 2008, driven mainly by a profit of NIS 130
million
derived from the issuances of shares in Shikun and Binui Nadlan as
well as the increase in the operating income of the real estate development
in Israel segment.

Financing costs net totaled NIS 37 million in the quarter.

Company's equity in losses of investees accounted for by the
equity method totaled a loss of NIS 20 million, deriving entirely from
accounting changes in the value of the State's option in Derech Eretz.

Net income totaled NIS 133 million, compared with NIS 11
million
in the fourth quarter last year. The growth was due to the gain of
NIS 130 million recognized by the Company with the allotment of 12.95% of the
shares of Shikun & Binui Real Estate, by Shikun & Binui Real Estate, to
institutional investors, which was offset in part by losses from the change
in value of the State's option in Derech Eretz of NIS 20 million.

Cash flows from operating activities increased in the quarter
to NIS 333 million.

Key Annual Results

Revenues from projects and sales totaled NIS 4.5 billion, similar to
revenues in 2008. Revenues from the infrastructure and construction outside
of Israel segment grew by 11% compared with 2008, totaling NIS 2.2 billion.
The growth was driven by the strengthening exchange rate of the dollar and
final settlements of accounts in projects. Revenues of the infrastructure and
construction in Israel segment totaled NIS 1.44 billion, similar to 2008;
revenues of the real estate development in Israel segment decreased by 3%
compared with 2008, totaling to NIS 813 million.

Gross profit totaled NIS 883 million (19.8% of revenues), growth of 32%
compared with gross profit in 2008 (15% of revenues). Most of the growth was
driven by the infrastructure and construction outside of Israel segment -
growth of 32% - due to the increase in the number of projects in which the
Group is involved, to the mix of projects and completion of the settlements
of accounts of projects that were completed. Growth of 16% and 17% were
posted in the gross profit of the infrastructure and construction in Israel
segment and the real estate development in Israel segment, respectively. The
growth in the gross profit of the real estate development in Israel segment
was driven mainly by four sales of properties and land.

General and administrative expenses totaled NIS 269 million, a change of
6% compared with 2008. Most of the change was caused by the Company's
expanding operations and the associated increase in employees costs as well
as the tenders for large projects and the resultant costs.

Operating income totaled NIS 707 million, growth of 77% compared with
2008. The growth was driven by the infrastructure and construction outside of
Israel segment and the real estate development in Israel segment, by 32% and
63%, respectively. The yearly operating profit included a total of NIS 130
million
resulting from the institutional allocation of subsidiary shares.

Net financing costs totaled NIS 261 million, compared with NIS 249
million
in 2008. The increase was driven by the Group's financing expenses
overseas, caused by an exchange rate loss in the Group's countries of
operation. The Group was in most cases compensated for these losses by the
parties who ordered the projects. The financing expenses attributed to Israel
decreased by NIS 15 million, driven by this year's lower increase in the
Consumer Price Index than last year's increase.

Company's equity in income/losses of investees accounted for by the
equity method totaled a loss of NIS 67 million, attributable mainly to the
effect of the State's option on the results of Derech Eretz. In 2008, the
Group recorded income in this item of NIS 21 million, which included a gain
of NIS 43 million attributed to the effect of the State's option on the
results of Derech Eretz. Also included in this item in 2009 were income from
the partnership building Segment 18 of the Trans Israel Highway and losses of
jointly-controlled foreign investees and investees in the concession segment.

Net income totaled NIS 232 million, compared with NIS 90 million last
year, deriving from, among others, the NIS 130 million gain recognized by the
Company upon the allotment by Shikun & Binui Real Estate to institutional
investors of 12.94% of the shares of Shikun & Binui Real Estate, which was
offset in part by the losses from the change in value of the State's option
in Derech Eretz of NIS 67 million.

Company's cash flows from operating activities totaled NIS 618 million.
In 2008, cash flows from operating activities totaled NIS 407 million.

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

Shareholders' equity as of December 31, 2009 totaled NIS 508 million,
compared with NIS 192 million at the end of 2008. Most of the increase
derived from the year's income (NIS 232 million) and the increase in the
minority interest (NIS 155 million) and was due to the allotment of a
subsidiary's shares to institutional investors, as well as to translation
adjustments of the financial statements of foreign subsidiaries (NIS 12
million
), which are prepared mainly in the dollar and euro, and net of the
dividend paid to shareholders (NIS 98 million).

Credit - during the year, the Group repaid NIS1,181 million in credit and
paid interest of NIS 220 million. During this period, the Group received
credit totaling NIS 442 million and raised NIS 197 million in an issuance of
debentures bearing fixed shekel interest.

The Group has cash and cash equivalent balances totaling NIS 1,180
billion
and unutilized credit facilities totaling NIS 588 million.

Net credit to the company as of 31.12.2009 totaled NIS 2,267 million.

Working capital of the Group totaled NIS 485 million, compared with NIS
380 million
at the end of 2008.

Total assets amount to NIS 7.4 billion.

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 Annual Statement of Financial Position as at

    In Thousand NIS                           December 31  December 31
                                                 2009         2008

    Assets
    Cash and cash equivalents                   1,180,517    1,348,846
    Bank deposits                                 170,226       44,001
    Short-term loans and investments               63,915       34,974
    Short-term loans to investee companies        331,304      318,598
    Trade receivables - accrued income            872,670      822,029
    Receivables and debit balances                166,902      200,954
    Other investments, including derivatives        2,619           11
    Current tax assets                             72,107       90,631
    Inventory                                     199,234      192,364
    Inventory of buildings held for sale        1,021,668      926,311
    Assets classified as held for sale              8,065  -
    Total current assets                        4,089,227    3,978,719

    Non-current inventory of land (freehold)      478,425      497,466
    Non-current inventory of land (leasehold)     198,620      197,506
    Investment property, net                      292,165      300,071
    Land rights                                    16,975       16,478
    Long-term prepaid expenses                     42,657       45,118
    Receivables, loans and deposits               406,653      513,694
    Investments in equity-accounted investees     138,572      151,746
    Loans to investee companies                   618,270      561,368
    Deferred tax assets                           116,498      119,115
    Receivables - financial asset                  68,109        6,861
    Property, plant and equipment, net            805,829      769,896
    Intangible assets, net                        101,459       90,794
    Total non-current assets                    3,284,232    3,270,113

    Total assets                                7,373,459    7,248,832
 <end_table>
    Shikun & Binui Ltd.

    Condensed Consolidated Annual Statement of Financial Position as at
(cont.)

    Balance Sheet (cont.)

    In Thousand NIS        December 31   December 31
                              2009          2008

    Liabilities
    Short-term credit from
      banks and others         879,586     1,116,352
    Subcontractors and
      trade payables           683,040       608,611
    Short-term employee
      benefits                  35,982        45,390
    Payables and credit
      balances including
      derivatives              289,917       260,436
    Current tax
      liabilities               95,445        72,732
    Provisions                 303,631       315,129
    Payables - customer
      work orders              750,958       727,490
    Advances received from
      customers                565,072       453,295

    Total current
      liabilities            3,603,631     3,599,435

    Liabilities to banks
      and others             1,129,821     1,385,385
    Debentures               1,912,160     1,852,308
    Employee benefits          140,703       139,323
    Deferred tax
      liabilities               15,299        16,906
    Provisions                  24,654        26,625
    Excess of accumulated
      losses over cost of
      investment and
      deferred credit
      balance in affiliated
      companies                 39,056        36,653
    Total non-current
      liabilities            3,261,693     3,457,200

    Total liabilities        6,865,324     7,056,635

    Equity
    Total equity
      attributable to equity
      holders of the Company   351,003       183,252
    Minority interest          157,132         8,945
    Total equity               508,135       192,197
    Total equity and
      liabilities            7,373,459     7,248,832
    Shikun & Binui Ltd.

    Condensed Consolidated Annual Statements of Income

    Income Statement

                                               for the    for the    for the
                                               twelve     twelve     twelve
                                               months     months     months
                                               ended      ended      ended
                                               December   December   December
    In thousands NIS                             31         31         31
                                                2009       2008       2007

    Revenues from work performed and sales   4,453,729  4,446,828  4,109,213
    Cost of work performed and sales         3,570,666  3,778,464  3,516,423
    Gross profit                               883,063    668,364    592,790
    Gain on sale of investment property         10,978     20,895     27,014
    Selling and marketing expenses             -25,147    -23,598    -25,670
    Administrative and general expenses       -268,704   -253,765   -247,095
    Other operating income                     135,565     72,114     22,954
    Other operating expenses                   -28,690    -85,211    -34,303
    Operating income                           707,065    398,799    335,690
    Financing income                           132,726    156,074    154,862
    Financing expenses                        -393,437   -405,306   -335,021
    Net financing expenses                    -260,711   -249,232   -180,159
    Company's share in income of equity
      accounted investees                      -66,981     20,677     25,222
    Income before taxes on income              379,373    170,244    180,753
    Taxes on income                           -147,232    -80,554    -90,861
    Net income for the period                  232,141     89,690     89,892
    Attributable to:
    Equity holders of the Company              237,337     91,762     88,537
    Minority interest                           -5,196     -2,072      1,355
                                               232,141     89,690     89,892

    Basic and diluted earnings
      per share (in NIS)                         0.602      0.233      0.224

    Number of shares used in the computation
    of earnings per share (in thousands)       394,545    394,545    394,545

    * Reclassified
    Shikun & Binui Ltd

    Business Operating Segments
    Business Segments
    In thousands NIS
                               the year ended December 31, 2009
                    Infrastructure Infrastructure   Real Estate  Real Estate
                    and Building,   and Building,  Development,  Development,
                       Oversees        Israel         Israel       Oversees 

    Revenues from
    external             2,199,644       1,317,155       804,830      6,544
    Revenues between
    sectors                      0         119,444         8,295          0
    Total revenues       2,199,644       1,436,599       813,125      6,544
    Net sector income
    (loss) before tax      365,997           9,206       181,112    -58,482

    Continues below..

                     Concessions  Environment  Others   Adjust.  Consolidated

    Revenues from
    external                  0     125,786     -230          0    4,453,729
    Revenues between
    sectors                   0           0        0   -127,739            0
    Total revenues            0     125,786     -230   -127,739    4,453,729
    Net sector income
    (loss) before tax   -43,349     -19,003   -9,201     -46,907     379,373

                              the year ended December 31, 2008
                    Infrastructure Infrastructure   Real Estate  Real Estate
                    and Building,   and Building,  Development,  Development,
                       Oversees        Israel         Israel       Oversees  

    Revenues from
    external            1,985,411    1,382,463       832,846       17,037
    Revenues between
    sectors                     0       93,642         7,916            0
    Total revenues      1,985,411    1,476,105       840,762       17,037
    Net sector income
    (loss) before tax     332,666       19,460        98,979      -66,060

    Continues below...

                      Concessions  Environment  Others  Adjust. Consolidated

    Revenues from
    external                  0      129,646   99,425         0   4,446,828
    Revenues between
    sectors                   0            0    1,766  -103,324           0
    Total revenues            0      129,646  101,191  -103,324   4,446,828
    Net sector income
    (loss) before tax    15,023      -12,048  -57,934  -159,842     170,244
    * Reclassified
                             the year ended December 31, 2007
                    Infrastructure Infrastructure   Real Estate  Real Estate
                    and Building,   and Building,  Development,  Development,
                       Oversees        Israel         Israel       Oversees   

    Revenues from
    external             1,867,206     1,161,772     682,485       48,951
    Revenues between
    sectors                      0       164,503       7,704            0
    Total revenues       1,867,206     1,326,275     690,189       48,951
    Net sector income
    (loss) before tax      305,344        -7,025      69,826       -3,228

    Continues below...

                       Concessions  Environment  Others  Adjust. Consolidated

    Revenues from
    external                 0       123,412    225,387         0  4,109,213
    Revenues between
    sectors                  0             0      8,698  -180,905          0
    Total revenues           0       123,412    234,085  -180,905  4,109,213
    Net sector income
    (loss) before tax   24,353        -7,062    -19,300  -182,155    180,753

    * Reclassified
    Company Contact:                  Investor Relations Contacts:
    Doron Blachar, CFO                Ehud Helft / Porat Saar
    Shikun & Binui                    GK Investor Relations
    Tel: +972-3-630-1518              Tel: +1-646-233-2161/ +972-52-776-3687
                                      email: info@gkir.com
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