Shikun & Binui Announces Third Quarter and Nine Month 2009 Results
By Shikun Binui Ltd., PRNESunday, November 22, 2009
Operating Income Increases 14.2% to NIS 119 Million; Operating Margin Reaches 11.7%, up From 8.6% Last Year; Gross Margin Reaches 18.6%, up From 16.9% Last Year; Operating Cash Flow Substantially Increased to NIS 135 Million
RAMAT GAN, Israel, November 23 - 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 three and nine
month periods ended September 30, 2009.
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.
"The Company is currently well positioned to continue to
tender for, and win, mega projects in both Israel and overseas. Our
substantial experience and broad capabilities are key in enabling us to
continue to implement our strategy in all our business sectors." commented
Mr. Ofer Kotler, Chief Executive Officer of Shikun & Binui.
Main Events of the Third Quarter and Subsequent to it:
- The Group, through its wholly owned subsidiary SBI Infrastructure,
signed a $230 million contract in Guatemala for the planning,
paving and maintenance of the new 300 km northern highway - Franja
Traversal Del Norte - one of the key access ways connecting the countries
in Central America. The planning and paving stage will take 3.5 years and
subsequently the company will maintain the road for the following 10
years. The project is being financed by means of loans from the
Guatemalan government as well as a Central American bank;
- The Group, through a consolidated company, gained the highest rating in
a tender issued by Israel's National Highway Company (Maatz) for the
rehabilitation, operation and maintenance of roads throughout the
northern part of Israel under the PFI method, for the next 20 years.
Total expected future considerations are estimated at NIS 1.3 billion.
The company signed an agreement with Maatz on September 14, 2009
finalizing the terms of the win.;
- The Company opened section 18 of the Cross Israel Highway,
eight months ahead of schedule;
- Shikun & Binui Real Estate sold 285 apartments throughout the country
in the third quarter, and 721 apartments during the first nine months;
- The Company raised NIS 200 million through a new series of
fixed interest bearing debentures
Third Quarter 2009 Results
Revenues for the third quarter of 2009 totaled NIS 1.0
billion, compared to NIS 1.2 billion in the third quarter last year. Revenues
from the Infrastructure and construction outside of Israel segment increased
10.5% reaching NIS 492 million resulting from expansion of activities.
Revenues from the Real Estate Development in Israel segment,
which, under IFRS standards, are generated primarily on the handover of
apartments, decreased to NIS 146 million, from the NIS 351 million in the
comparable period, following a higher than average number of apartment
handovers in Kiryat Ono and Ir Yamim, Netanya in the third quarter last year.
Gross profit for the third quarter totaled NIS 190 million,
compared to NIS 205 million in the third quarter last year. Gross profit as a
percent of revenues rose to 18.6%, from 16.9% gross margin in the comparable
period last year. The higher gross margin is primarily attributed to the
change in project mix, as well as the finalization of payment following
completion of certain projects, including the receipt of early completion
bonuses on projects completed ahead of schedule.
Sales and marketing expenses, for the third quarter, totaled
NIS 64 million (6.3% of revenues), an 8.6% increase compared to the
comparable period last year (4.9% of revenues) resulting from an increase in
expenses associated with tenders the Group is currently bidding for in both
Israel and overseas.
Operating income for the third quarter of 2009 totaled NIS 119
million (11.7% of revenues), an increase of 14.2% compared to the third
quarter last year (8.6% of revenues).
Finance expenses, net, for the third quarter decreased to NIS
97 million, compared to NIS 119 million in the third quarter last year. The
majority of the decrease resulted from a slight increase in the Israeli
Consumer Price Index (CPI), compared to the third quarter last year, which
reduced long term debenture expenses, partially offset by currency losses
resulting from the impact of currency fluctuations on foreign activities.
Company's share in the equity gains\losses of affiliated
companies, recorded under the equity method, totaled a loss of NIS 23.6
million attributed to the impact of the valuation of the Israeli Governments
option on Derech Eretz Highway's results. In the comparable period the
Company recorded a NIS 7 million equity gain.
During the third quarter the Company recorded a net loss to
the amount of NIS 29 million, compared to a NIS 33 million loss in the
comparable period last year.
Cash flow generated from operating activities during the third
quarter of 2009 increased substantially from the third quarter last year,
reaching NIS 135 million.
First Nine Months 2009 Results
Revenues for the first nine months of 2009 totaled NIS 3.36
billion, compared to NIS 3.32 billion in the nine months last year. Revenues
from the Infrastructure and construction outside of Israel segment increased
13.9% over last year reaching NIS 1.7 billion.
Gross profit totaled NIS 673 million, a 27% increase compared
to the first nine months last year. Gross profit, as a percent of revenues,
rose to 20%, an increase from the 16% gross margin in the comparable period
last year.
Sales and marketing expenses for the first nine months of 2009
represented 5.6% of revenues totaling NIS 188 million, similar as the
comparable period last year.
Operating income for the first nine months rose 38.2% reaching
NIS 474 million. Operating income as a percent of revenues rose to 14.1%, an
increase from the 10.3% operating margin in the first nine months last year.
Finance expenses, net, for the first nine months totaled NIS
224 million, compared to NIS 235 million in the comparable period last year.
The decline primarily follows the finance expenses incurred by the overseas
companies, resulting from losses incurred on currency fluctuations in the
operating countries. The Company is compensated by the contractors on these
losses. The finance expenses attributed to Israel declined by NIS 30 million
following a slight increase, compared to the comparable period, in the
Israeli CPI Index.
Company's share in the equity gains\losses of affiliated
companies, recorded under the equity method, totaled a loss of NIS 47 million
primarily attributed to the impact of the valuation of the Israeli
Governments option on Derech Eretz Highway's results. In the comparable
period last year the Company recorded a NIS 42 million equity gain, NIS 24
million of which relates to the impact the governments options bore of Derech
Eretz' results. This section also includes gains resulting from the
construction partnerships profits on section 18 of the Cross Israel Highway
as well as losses relating to jointly controlled companies held overseas as
well as companies held in the concession area.
Net income for the first nine months of 2009 totaled NIS 99
million, a 25% increase from the NIS 79 million in comparable period last
year.
Cash flow generated from operating activities during the first
nine months of 2009 totaled NIS 285 million, and served to finance NIS 173
million of investment activities. During the first nine months 2008 the
Company generated NIS 75 million in cash from operating activities.
The group does not re-evaluate its real estate assets and
records them based on their historic cost in the balance sheet.
Shareholders' equity as at September 30, 2009, totaled NIS 215
million, compared to NIS 192 million at the end of 2008. The increase
primarily resulted from the first nine month 2009 net income (NIS 99
million), from translation differences resulting from the conversion of the
foreign subsidiaries financial statements (NIS 10 million) primarily prepared
in US dollars and Euro, offset by the dividend payment made in September
2009.
Credit. During the first nine months the Company repaid NIS
463 million of credit and paid out interest to the amount of NIS 137 million.
During the period the Company received NIS 326 million of credit as well as
raised NIS 197 million in credit through the issue of debentures bearing
fixed shekel interest.
Working capital totaled NIS 363 million at the end of the
period, compared to NIS 380 million at the end of 2008. As of September 30,
2009 the Company had cash, cash equivalents and deposits totaling NIS 1.3
billion. Furthermore, the Company has unutilized credit facilities in the
amount of NIS 363 million.
Total assets, as at September 30, 2009, totaled NIS 7.5
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. 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
In Thousand NIS September 30 September 30 December 31
2009 2008 2008
(Unaudited) (Audited)
Assets
Cash and cash equivalents 1,317,905 929,811 1,348,846
Bank deposits 238,412 32,007 44,001
Short-term loans and investments 62,184 25,911 34,974
Short-term loans to investee
companies 328,929 242875 318,598
Trade receivables - accrued
income 957,265 920,125 822,029
Receivables and debit balances 161,368 229,052 200,954
Other investments, including
derivatives 732 18,262 11
Current tax assets 51,139 80,471 90,631
Inventory 197,171 195,173 192,364
Inventory of buildings held for
sale 993,642 1,012,674 926,311
Assets classified as held for
sale 6,248 0 -
Total current assets 4,314,995 3,686,361 3,978,719
Non-current inventory of land
(freehold) 495,614 496,014 497,466
Non-current inventory of land
(leasehold) 208,378 199,384 197,506
Investment property, net 298,498 302,474 300,071
Land rights 16,508 17,424 16,478
Long-term prepaid expenses 43,566 44,104 45,118
Receivables, loans and deposits 299,890 467,739 513,694
Investments in equity-accounted
investees 137,795 156,858 151,746
Loans to investee companies 615,210 552,074 561,368
Deferred tax assets 124,339 118,347 119,115
Receivables - financial asset 47,588 0 6,861
Property, plant and equipment,
net 808,041 708,084 769,896
Intangible assets, net 98,300 77,225 90,794
Total non-current assets 3,193,727 3,139,727 3,270,113
Total assets 7,508,722 6,826,088 7,248,832
Shikun & Binui Ltd.
Condensed Consolidated Interim Statement of Financial Position as at
(cont.)
In Thousand NIS September 30 September 30 Dec-31
2009 2008 2008
(Unaudited) (Audited)
Liabilities
Short-term credit from banks
and others 1,123,180 1,318,845 1,116,352
Subcontractors and trade
payables 630,331 617,673 608,611
Short-term employee benefits 30,313 24,406 45,390
Payables and credit balances
including derivatives 294,800 271,054 260,436
Current tax liabilities 99,405 58,530 72,732
Provisions 291,908 310,571 315,129
Payables - customer work orders 673,969 543,274 727,490
Advances received from
customers 534,808 568,995 453,295
Held-to-sale commitments - 0 -
Total current liabilities 3,678,714 3,713,348 3,599,435
Liabilities to banks and others 1,327,269 740,682 1,385,385
Debentures 2,074,142 2,045,283 1,852,308
Employee benefits 129,832 155,454 139,323
Deferred tax liabilities 19,276 17,404 16,906
Provisions 25,698 25,413 26,625
Excess of accumulated losses
over cost of investment and
deferred credit balance in
affiliated companies 39,246 35,849 36,653
Total non-current liabilities 3,615,463 3,020,085 3,457,200
Total liabilities 7,294,177 6,733,433 7,056,635
Equity
Total equity attributable to
equity holders of the Company 210,400 83,061 183,252
Minority interest 4,145 9,594 8,945
Total equity 214,545 92,655 192,197
Total equity and liabilities 7,508,722 6,826,088 7,248,832
Shikun & Binui Ltd.
Condensed Consolidated Interim Statements of Income
For the nine months For the three months
In thousands NIS ended September 30 ended September 30
2009 2008 2009 2008
(Unaudited) (Unaudited)
Revenues from work
performed and sales 3,359,861 3,321,084 1,021,355 1,212,268
Cost of work performed and
sales 2,686,670 2,791,276 831,052 1,006,752
Gross profit 673,191 529,808 190,303 205,516
Gain on sale of investment
property 7,810 22,168 -297 7,994
Selling and marketing
expenses -17,767 -17,903 -6,198 -6,041
Administrative and general
expenses -188,362 -182,256 -64,430 -59,328
Other operating income 3,956 64,198 1,333 13,019
Other operating expenses -4,980 -73,239 -1,400 -56,705(*)
Operating income 473,848 342,776 119,311 104,455
Financing income 109,686 117,203(*) 47,098 24,138(*)
Financing expenses -333,224 -352,057(*) -143,819 -142,815(*)
Net financing expenses -223,538 -234,854 -96,721 -118,677
Company's share in income
of equity accounted
investees -46,606 42,120 -23,592 6,995
Income before taxes on
income 203,704 150,042 -1,002 -7,227
Taxes on income -104,855 -71,516 -28,305 -26,337
Net income for the period 98,849 78,526 -29,307 -33,564
Attributable to:
Equity holders of the
Company 101,852 78,770 -28,029 -34,200
Minority interest -3,003 -244 -1,278 636
98,849 78,526 -29,307 -33,564
Basic and diluted earnings
per share (in NIS) 0.26 0.2 -0.07 -0.09
Number of shares used in the
computation of earnings
per share (in thousands) 394,545 394,545 394,545 394,545
* Reclassified
(continued...)
for the twelve months
In thousands NIS ended December 31
2008
(Audited)
Revenues from work performed and sales 4,446,828
Cost of work performed and sales 3,778,464
Gross profit 668,364
Gain on sale of investment property 20,895
Selling and marketing expenses -23,598
Administrative and general expenses -253,765
Other operating income 72,114
Other operating expenses -85,211
Operating income 398,799
Financing income 156,074
Financing expenses -405,306
Net financing expenses -249,232
Company's share in income of equity
accounted investees 20,677
Income before taxes on income 170,244
Taxes on income -80,554
Net income for the period 89,690
Attributable to:
Equity holders of the Company 91,762
Minority interest -2,072
89,690
Basic and diluted earnings per share (in NIS) 0.23
Number of shares used in the computation
of earnings per share (in thousands) 394,545
* Reclassified
Shikun & Binui Ltd.
Business Operating Segments
In thousands NIS nine month period ended September 30, 2009
Infrastructure Infrastructure Real Estate Real Estate
and Building, and Building, Development, Development,
Oversees Israel Israel Oversees
(Unaudited)
Revenues from
external 1,700,402 1,003,207 565,329 4,304
Revenues between
sectors 0 85,434 6,287 0
Total revenues 1,700,402 1,088,641 571,616 4,304
Net sector
income (loss)
before tax 278,253 26,569 124,042 -35,184
In thousands NIS nine month period ended September 30, 2009
(continued...)
Concessions Environment Others Adjust. Consolidated
(Unaudited)
Revenues from
external 0 86,784 -165 0 3,359,861
Revenues between
sectors 0 0 0 -91,721 0
Total revenues 0 86,784 -165 -91,721 3,359,861
Net sector
income (loss)
before tax -39,300 -3,202 -7,802 -139,672 203,704
nine month period ended September 30, 2008
Infrastructure Infrastructure Real Estate Real Estate
and Building, and Building, Development, Development,
Oversees Israel Israel Oversees
(Unaudited)
Revenues from
external 1,492,960 1,025,245 586,526 13,760
Revenues between
sectors 0 82,063 5,906 0
Total revenues 1,492,960 1,107,308 592,432 13,760
Net sector
income (loss)
before tax 262,097 18,623 91,865 -33,027
nine month period ended September 30, 2008
Concessions Environment Others Adjust. Consolidated
(Unaudited)
Revenues from
external 0 99,157 103,436 0 3,321,084
Revenues between
sectors 0 0 1,800 -89,769 0
Total revenues 0 99,157 105,236 -89,769 3,321,084
Net sector
income (loss)
before tax 14,608 -1,316 39,033 -163,775 150,042
Shikun & Binui Ltd.
three month period ended September 30, 2009
Infrastructure Infrastructure Real Estate Real Estate
and Building, and Building, Development, Development,
Oversees Israel Israel Oversees
(Unaudited)
Revenues from
external 492,017 351,296 143,729 378
Revenues between
sectors 0 39,585 2,133 0
Total revenues 492,017 390,881 145,862 378
Net sector
income (loss)
before tax 58,701 16,425 34,472 -7,313
Concessions Environment Others Adjust. Consolidated
(Unaudited)
Revenues from
external 0 35,114 -1,179 0 1,021,355
Revenues between
sectors 0 0 0 -41,718 0
Total revenues 0 35,114 -1,179 -41,718 1,021,355
Net sector
income (loss)
before tax -23,117 -609 -4,793 -74,768 -1,002
three month period ended September 30, 2008
Infrastructure Infrastructure Real Estate Real Estate
and Building, and Building, Development, Development,
Oversees Israel Israel Oversees
Revenues from
external 445,111 370,627 348,556 4,862
Revenues between
sectors 0 16,739 2,355 0
Total revenues 445,111 387,366 350,911 4,862
Net sector
income (loss)
before tax 73,164 9,236 49,010 -15,678
* Reclassified
Concessions Environment Others Adjust. Consolidated
(Unaudited)
Revenues from
external 0 42,046 1,066 0 1,212,268
Revenues between
sectors 0 0 49 -19,143 0
Total revenues 0 42,046 1,115 -19,143 1,212,268
Net sector
income (loss)
before tax 6,560 -3,259 -31,215 -95,045 -7,227
Company Contact: Investor Relations Contacts:
Doron Blachar, CFO Ehud Helft / Fiona Darmon
Shikun & Binui GK Investor Relations
Tel: +972-3-630-1518 Tel: +1-646-797-2868 / +97-52-695-4400
email: info@gkir.com
Company Contact:Doron Blachar, CFO, Shikun & Binui, Tel: +972-3-630-1518; Investor Relations Contacts: Ehud Helft / Fiona Darmon, GK Investor Relations, Tel: +1-646-797-2868 / +97-52-695-4400, email: info at gkir.com
Tags: Israel, Ramat gan, Shikun & Binui Ltd.
