Shikun & Binui Announces Full Year 2017 Financial Results

Shikun & Binui Announces Full Year 2017 Financial Results

- 2017 Revenues increased 20% to ~NIS 6.4B from ~NIS 5.4B in 2016; 2017 Net Profit of ~NIS 298M and ~NIS 150M for Q4 -

AIRPORT CITY, Israel, April 1, 2018 /PRNewswire/ -- Shikun & Binui Ltd. (TASE: SKBN.TA), a global construction and infrastructure company headquartered in Israel, today reported its financial results for the fourth quarter and full year, ended December 31, 2017.

Financial Highlights for 2017

    --  Revenues for 2017 were ~NIS 6.4 billion, an increase of 20% compared
        with those of 2016, driven primarily by growth from Solel Boneh Israel,
        due to the ramp-up of construction work mainly on the Ashalim project,
        as well as from the International Construction segment due to the
        renewal of work in Nigeria.
    --  Gross profit for the year totaled ~NIS 851 million, or 13.2% of
        revenues, compared with ~NIS 837 million, or 15.6% of revenues, in 2016.
    --  Net profit for the year totaled ~NIS 298 million compared with ~NIS 480
        million in 2016.
    --  Operating cash flow excluding investments in land inventories and
        concessions arrangements, was a positive ~NIS 212 million. Including
        investment activities, the operating cash flow was ~NIS (310) million.

1. CONSTRUCTION

Solel Boneh

    --  Total revenues for 2017 were ~NIS 3.5 billion.
    --  During October, Solel Boneh won engineering contracts from Israel's
        Ministry of Defense amounting to ~NIS 640 million for projects in
        Israel's southern region. This project is not included in the company's
        backlog for the end of 2017.
    --  In February, Solel Boneh completed the acquisition of Menora, a
        privately-held company that engages in the execution, construction and
        maintenance of complex electrical systems for lighting, railroad
        crossings, traffic control and other applications, employing ~235
        workers. The acquisition is in line with Shikun & Binui's strategy to
        expand construction offerings and will be complementary and synergistic
        to other activities in Israel and throughout the world.
    --  Primary mega projects in process: Gilboa Pumped Storage, Ashalim Thermo
        Solar, Tel Aviv Light Rail (Western Section), the Generi 2 Government
        Building campus and others.

SBI

    --  Total revenues for 2017 were ~NIS 1.9 billion, driven by continued
        execution of contracting projects throughout the world, including mega
        projects in the US and Colombia
    --  Won projects in two new countries: Tanzania and Mozambique
    --  In February 2018, the company signed an agreement to build a new airport
        in Uganda for ~USD 309 million. The company has received a deposit of
        ~10% of the total contract amount.
    --  Beginning in the third quarter, the company began buying significant
        quantities of dollars in Nigeria at the NIFEX exchange rate (of
        approximately 330 naira to the US dollar) due to a change in the policy
        of the Central Bank of Nigeria. Given the current ability to receive
        dollar allocations according to the NIFEX methodology, the company has
        decided to translate its financial reports based on the NIFEX exchange
        rate, beginning with the third quarter of 2017.
    --  Began delivery on stage 1 of the Colombia Toll Roads Project as part of
        the trial period; work on stages 2 and 3 is expected to be delayed due
        to a current lack of instructions from the ordering entity. Regarding
        stages 4 and 5, changes in the route of the project maybe required due
        to the discovery of water sources in the area. As a result, the
        project's funders have stopped the draw-down of funds until a new plan
        has been drawn up an approved by the government. During the reporting
        period, a provision of ~USD 5 million was made in respect of the
        project.

2. RESIDENTIAL REAL ESTATE DEVELOPMENT

Apartment Sales

    --  Early implementation of the IFRS Standard in 2017: According to the IFRS
        Standard, the company reports revenues from Israeli apartment sales over
        time according to the progress made in the each project's building and
        sales processes. The policy for revenue recognition from apartment sales
        in other countries remains unchanged: that is, all revenues are
        recognized at the time of delivery.
    --  During 2017, the company sold 1,623 apartments (100% share) totaling
        ~NIS 1,507 million, including 539 units in Israel and 1,084 units in
        Europe.
    --  In Europe, most of apartment sales were in Poland, where 547 units were
        sold; in Serbia, 201 units were sold; in the Czech Republic, 193 units
        were sold; and in Romania, 143 units were sold.
    --  In Israel, the company began planning for the construction of 657
        apartments and commercial space in Or Yam in Or Akiva. In addition, it
        initiated marketing efforts for new projects in Givat Shmuel, Ashkelon,
        Kfar Yona and Harish, and building began for projects in Rishon Letzion
        and Givat Shmuel.

The table below shows additional data regarding the company's sale of apartments (signed contracts) during 2017:


                                         Apartment         Consolidated        Companies
                                        Units Under         Companies         Under Joint
                                          Company                               Control
                                         Management
                                         Including
                                       Partner Share
                                       -------------

    Israel
    ------

    Sales                                              960                816               -
    (NIS millions)
    -------------

    Number of apartment sale contracts                 539                462               -
    signed
    ------

    Average price of apartments sold                 1,766              1,781               -
    (NIS thousands)
    --------------

    Europe
    ------

    Sales                                              547                312              73
    (NIS millions)
    -------------

    Number of apartment sale contracts               1,084                703             101
    signed
    ------

    Average price of apartments sold                   505                444             726
    (NIS thousands)
    --------------

The table following shows data regarding the Company's delivery of apartments to customers during 2017:


                                                      Consolidated       Companies Under
                                                       Companies          Joint Control
                                                       ---------          -------------

    Israel
    ------

    Revenues from apartments delivered (NIS millions)              1,840                   -
    ------------------------------------------------               -----                 ---

    Number of units delivered                                      1,178                   -
    -------------------------                                      -----                 ---

    Average price of apartments delivered (NIS                     1,562                   -
    thousands)
    ---------

    Europe
    ------

    Revenues from apartments delivered (NIS millions)                 91                  91
    ------------------------------------------------                 ---                 ---

    Number of units delivered                                        266                 154
    -------------------------                                        ---                 ---

    Average price of apartments delivered (NIS                       342                 592
    thousands)
    ---------

Land in Israel

    --  The sale of the company's rights in various land plots in North Tel Aviv
        was completed in December 2017. The company recorded a ~NIS 89 million
        profit in respect of the transaction.
    --  Progress with the plan for the Old Tel Aviv Bus Station: the plan was
        approved for filing. Under the plan's framework, tens of new residential
        towers will be built to house a combined total of 1,160 apartments,
        commercial space, a dance center and an international food court.
    --  During the year, the company secured land for the construction of ~1,300
        residential units in future developments. The land parcels are located
        in Or Akiva (~660 units), Jerusalem (~200 units), Harish (~180 units),
        Hod Hasharon (~135 units) and Givat Shmuel (~110 units).

3. PROJECTS & IGAs (INCOME GENERATING ASSETS)

The company continues to implement its strategy aimed at realizing value and freeing cash for investment in new projects:

    --  The company has entered into a process for selling 45% of its rights in
        the Carmel Tunnels project and 40% of its rights in the North Roads
        project. Purchase offers have been received from a limited group of
        investors (including institutional investors), and the company intends
        to serve as the General Partner. Upon completion of the transaction, the
        company expects to recognize a profit of between NIS 250-300 million and
        cash flow of ~NIS 580 million.
    --  Sale of 50% of the company's rights in the office space KBP in Poland:
        the company's proceeds from the sale included ~NIS 57 million in pre-tax
        profit and profit from revaluation of the investment, and ~NIS 580
        million in cash flow.
    --  Sale of 100% of the company's holdings in the concessionaire of the Tel
        Aviv Courthouse project: the company's proceeds from the sale included
        ~NIS 8.5 million in pre-tax profit and ~NIS 13.5 million in cash flow.
    --  The company has entered into a process for selling 100% of its rights in
        the Generi 2 Government Campus project. If and when the sale is
        completed, the company expects to recognize between NIS 25-30 million in
        post-tax profit and ~NIS 70 million in cash flow. The earliest that the
        deal is expect to be completed would be January 2019.

New Concessions projects in Israel (to be executed by Solel Bonei):

    --  Regional government campus in Nazareth: total project value - ~NIS 400
        million
    --  Courthouse in Hadera: total project value - ~NIS 150 million

Progress with portfolio of existing Renewable Energy projects:

    --  Financial closing of the 120MW Tze'elim photovoltaic project, in 2018
        Construction of the project was initiated
    --  Received pending license for the conversion of the Etgal power plant to
        natural gas and for expanding its generation capacity from 26MW to 186MW
    --  Began construction of 6 high voltage PV projects totaling up to 60MW
    --  Won an Israel Electric Company tender to construct high voltage PV
        projects totaling up to 25MW

ADO GROUP Shareholders' Agreement: If and when the deal is completed, the company expects to consolidate the financial results of the ADO GROUP. As a result, it expects to record a profit of ~NIS 400 million due to the revaluation of the company's investment in ADO GROUP.

Provision for a decline in value of Elcon: The decline in the value of Elcon has led the company to make the following adjustments:

    --  Goodwill: NIS 31.5 million
    --  Unrealized wastewater treatment technology assets: NIS 28.6 million
    --  Fixed assets: NIS 20.1 million

Changes in the company's credit ratings:

Ma'alot: In March 2017, the company's rating and bonds from series 4 to 8 were rated (ilA) and with positive outlook. After the date of the report, Ma'alot put this rating onto the watchlist with negative outlook.

Midroog: In October 2017, Midroog left the rating unchanged at A1 with a negative outlook. After the date of the report, Midroog reduced these bonds to a rating of A2 with a negative outlook.

Early adoption of IFRS 15 Standard as of the December 31 2017 results

    --  The standard has been implemented with the approach of the accumulated
        effect, in coordination with starting balances as of January 1, 2017 and
        without a restatement of the comparable numbers. The main impact of this
        first implementation of the standard on the Group's revenue recognition
        policy relates to the company's residential real estate development
        activities in Israel. According to the rules of the standard, apartment
        sales are recognized over time based on certain criteria, in contrast to
        the rules of the IAS 11, in which the Group recognizes apartment sales
        in full at the time of delivery to the buyer. Revenue recognition from
        the sales of apartments outside of Israel is at the time of delivery
        without any changes from previous policy


    --  In addition, this first implementation of the standard affects the
        Group's accounting treatment of the variable payments made for
        contracting projects. According to the rules of the standard, a higher
        level of certainty is required to enable recognition of a contract's
        variable revenues as compared to the level that was required under the
        IAS 11.
    --  The total effect of the implementation since January 1, 2017 has been a
        ~NIS 82.3 million increase in the Group's Shareholders Equity
        (reflecting an ~NIS 163 million increase in the Israel Real Estate
        Development division, countered by an ~NIS 81 million reduction in the
        International Construction and Infrastructure and Israel Construction &
        Infrastructure divisions). The main source of the change was an NIS
        1,403 million reduction in Inventory of Buildings for Sale, countered by
        a ~NIS 1,022 reduction in customer advances and an ~NIS 429 million
        increase in future revenues.

Claims Related to the Activities of SBI:

    --  Claims of a former employee: In July 2017, a former employee of SBI AG
        (a Switzerland-domiciled granddaughter company of Shikun & Binui) filed
        a lawsuit in Israel's Labor Court against SBI AG, SBI AG's parent
        company (SBI Infrastructure), SBI AG's sister company (SBI E&M) and the
        manager of SBI AG's Kenyan office. In the suit, the worker claimed that
        he was owed various payments due to his termination from the Kenyan
        company, and an arbitration process between the two sides was initiated
        (a process which was recently halted in light of a police investigation,
        and which has not yet been completed). Under the framework of the
        lawsuit, the worker also made allegations regarding the propriety of SBI
        AG's conduct in Africa.


    --  Independent investigation: After becoming aware of the allegations
        regarding its conduct in Africa, SBI AG consulted with unrelated
        external investigative auditing experts in Switzerland (the country in
        which it is domiciled) with the goal of investigating the former
        employee's claims. The investigation, which was carried out intensively
        over several months, brought a number of facts and documents to light.
        On February 20, 2018, after the allegations began to be investigated by
        the Israeli police, the independent investigation was halted at the
        request of the police, before it had been concluded.


    --  Consultation with foreign compliance authorities: While the external
        investigation was underway, the company consulted with Swiss compliance
        authorities, informing them about the former employee's allegations and
        the steps that SBI AG was taking to investigate them, primarily
        including the independent investigation. The compliance authorities
        instructed SBI AG to continue with their investigation.


    --  Investigation by the World Bank: During January 2018, SBI AG was
        notified by the INT department of the World Bank, the department that
        investigates Integrity claims, that it intended to audit a number of SBI
        AG's completed projects in Kenya, some of which had been completed long
        ago. SBI AG began fully cooperating with the World Bank, including
        gathering the materials that has been requested. However, this process
        was also halted when the investigation by the Israeli police was
        initiated. The audit has not yet been completed.


    --  Israeli Police investigation: On and after February 20, 2018, a number
        of current and former employees of SBI AG, Shikun & Binui and the Shikun
        & Binui subsidiary that holds its shares in SBI AG - including employees
        who had completed their work for the company over five years ago - were
        held for investigation or summoned for testimony by the Israeli police.
        Some of those investigated were incarcerated for various lengths of time
        and/or released to house arrest and/or released with limitations. In
        parallel, the police seized various bank accounts of Shikun & Binui Ltd.
        and of some of its subsidiaries - accounts in which were deposited a
        total of more than NIS 200 million - as well as other assets, and
        searched and seized documents in SGI AG's offices in Israel and Kenya.
        The Group cooperated in full throughout the investigation.


    --  Deposit of funds in a forfeiture fund: On or near February 22, 2018, in
        an arrangement with the Israeli police, SBI AG deposited the dollar
        value of ~NIS 250 million into a closed forfeiture fund to secure the
        release of the assets and bank accounts that had been seized, as
        described above.
    --  Related lawsuits: Since the beginning of this chain of events, a request
        has been filed with a court to approve a class action against the
        company and its employees, and three requests against the company have
        been filed to allow discovery of documents related to investigation of
        the request.

At this stage, the Company is unable to assess its exposure regarding the police investigation or to the investigation by the World Bank, should it be renewed.

About the Shikun & Binui Group
The Shikun & Binui Group is a global construction and infrastructure company that operates in Israel and internationally in seven segments: 1) infrastructure and construction contracting outside of Israel; 2) infrastructure and construction contracting within Israel; 3) real estate development within Israel; 4) real estate development outside of Israel; 5) renewable energy; 6) concessions; The Group's activities focus on large, highly complex projects carried out for entities in private and public sectors with a focus on sustainability.


    IR Contacts:
    ------------


    Company                 External IR

    Inbal Uliansky          Ehud Helft

    +972 (3) 6301058        GK Investor Relations

    inbal_u@shikunbinui.com                       +1 617 418 3096

                            shikunbinuni@gkir.com

This summary announcement was prepared solely for the convenience of the reader and does not replace Shikun & Binui Ltd.'s (hereafter - "the Company") full report. The information contained in this announcement is, by its nature, incomplete. All of its contents are provided as a supplement to the Company's report, and are subject to the declarations therein stated. This announcement includes forecasts, assessments, estimates and other information relating to the Company or its subsidiaries, or to other parties or to future events and matters, the extent of whose realization is not certain and is not under the sole control of the Company (forward-looking information, as defined in the Securities Law-1968). The key facts and data serving as the basis for this information are facts and data, among others, related to the current status of the Company and its businesses, facts and data relating to the current status of the operating segments in which the Company engages in its areas of operation, and other macroeconomic facts and data known to the Company on the preparation date of this presentation.

It is understood that forward-looking information does not constitute a fact and is based solely on subjective assessments. Forward-looking information is uncertain and for the most part, is not under the Company's control. The realization or non-realization of the forward-looking information will be influenced, among others, by the risk factors that characterize the Company's operations, as well as developments in the general environment and external factors that impact the Company's operations. The Company's future results and achievements could differ significantly from those presented in this presentation. The Company is not obligated to update or modify the said forecast or assessment, and is not obligated to update this announcement. This announcement does not constitute an offer to purchase the Company's securities or an invitation to receive such offers. An investment in securities in general, and in the Company in particular, carries risk. One must take into account that past data do not necessarily indicate future performance.


    Condensed Consolidated Interim Financial Statements

    Condensed Consolitated Interim Statement of Financial Position as at
    --------------------------------------------------------------------


                                                                    December 31               December 31

                                                                           2017                       2016
                                                                           ----                       ----

                                                  NIS thousands                 NIS thousands
                                                  -------------                 -------------


    Assets

    Cash and
     cash
     equivalents                                                      2,029,574                  2,993,490

    Bank
     deposits                                                           657,668                    290,154

    Short-
     term
     loans
     and
     investments                                                         63,050                     92,028

    Short-
     term
     loans to
     investee
     companies                                                           31,854                        349

    Trade
     receivables
     -
     accrued
     income                                                           2,423,515                  2,060,621

    Inventory
     of
     buildings
     held for
     sale                                                             1,395,986                  2,468,749

     Receivables
     and
     debit
     balances                                                           498,838                    501,090

    Other
     investments,
     including
     derivatives                                                        241,641                     93,138

    Current
     tax
     assets                                                              19,692                     37,217

    Inventory                                                           176,145                    225,461

    Assets
     classified
     as held
     for sale                                                           105,352                    518,106
                                                                        -------                    -------

    Total
     current
     assets                                                           7,643,315                  9,280,403
                                                                      ---------                  ---------


     Receivables
     and
     contract
     assets
     in
     respect
     of

      concession
      arrangements                                                      923,267                    822,103

    Non-
     current
     inventory
     of land
     (freehold)                                                         789,699                    789,294

    Non-
     current
     inventory
     of land
     (leasehold)                                                        426,609                    338,941

     Investment
     property,
     net                                                                842,943                    924,557

    Land
     rights                                                              13,179                     13,021

     Receivables,
     loans
     and
     deposits                                                           522,795                    386,252

     Investments
     in
     equity-
     accounted
     investees                                                          598,512                    640,993

    Loans to
     investee
     companies                                                          612,054                    562,767

    Deferred
     tax
     assets                                                             162,932                    135,600

    Property,
     plant and
     equipment,
     net                                                                875,593                  1,041,533

     Intangible
     assets,
     net                                                                150,238                    242,586
                                                                        -------                    -------

    Total
     non-
     current
     assets                                                           5,917,821                  5,897,647
                                                                      ---------                  ---------




    Total
     assets                                                          13,561,136                 15,178,050
                                                                     ==========                 ==========


    Condensed Consolidated Interim Financial Statements

    Condensed Consolidated Interim Statement of Income
    --------------------------------------------------


                                                                  December 31               December 31

                                                                         2017                       2016
                                                                         ----                       ----

                                                    NIS thousands             NIS thousands
                                                    -------------             -------------


    Liabilities

    Short-term
     credit from
     banks and
     others                                                         1,036,026                  1,045,048

     Subcontractors
     and trade
     payables                                                       1,460,075                  1,280,799

    Short-term
     employee
     benefits                                                         136,860                    135,529

    Payables and
     credit
     balances
     including
     derivatives                                                      616,135                    690,275

    Current tax
     liabilities                                                      105,653                    122,889

    Provisions                                                        246,019                    310,003

    Payables -
     customer
     work orders                                                    1,345,436                  1,751,025

    Advances
     received
     from
     customers                                                        336,685                  1,443,812

    Dividend
     payable                                                                -                    16,940

    Liabilities
     classified
     as held for
     sale                                                                   -                   415,676
                                                                          ---                   -------

    Total current
     liabilities                                                    5,282,889                  7,211,996
                                                                    ---------                  ---------


    Liabilities
     to banks and
     others                                                         2,477,801                  2,262,410

    Debentures                                                      3,402,211                  3,314,628

    Employee
     benefits                                                          49,843                     54,056

    Deferred tax
     liabilities                                                      105,719                    123,849

    Provisions                                                        102,795                    109,530

    Excess of
     accumulated
     losses over
     cost of
     investment

     and deferred
      credit
      balance in
      investee
      companies                                                        48,130                     30,440
                                                                       ------                     ------

    Total non-
     current
     liabilities                                                    6,186,499                  5,894,913
                                                                    ---------                  ---------


    Total
     liabilities                                                   11,469,388                 13,106,909
                                                                   ----------                 ----------


    Equity


    Total equity
     attributable
     to owners                                                      1,849,025                  1,892,058

    Non-
     controlling
     interests                                                        242,723                    179,083
                                                                      -------                    -------

    Total equity                                                    2,091,748                  2,071,141
                                                                    ---------                  ---------


    Total
     liabilities
     and equity                                                    13,561,136                 15,178,050
                                                                   ==========                 ==========


                                       December 31               December 31                December 31

                                              2017                       2016                        2015
                                              ----                       ----                        ----

                         NIS thousands             NIS thousands              NIS thousands
                         -------------             -------------              -------------


    Revenues from work
     performed and sales                 6,437,307                  5,378,963                   5,068,702


    Cost of work
     performed and sales                 5,586,065                  4,541,744                   4,193,362
                                         ---------                  ---------                   ---------


    Gross profit                           851,242                    837,219                     875,340


    Gain on sale of
     investment property                     3,217                     70,543                      38,197

    Selling and
     marketing expenses                   (40,049)                  (32,318)                   (35,183)

    Administrative and
     general expenses                    (380,824)                 (366,479)                  (354,614)

    Share of profits of
     equity

     accounted investees
      (net of tax)                          59,816                     81,172                      76,575

    Other operating
     income                                219,622                    451,797                     142,361

    Other operating
     expenses                            (130,028)                  (41,762)                   (64,810)
                                          --------                    -------                     -------


    Operating profit                       582,996                  1,000,172                     677,866
                                           -------                  ---------                     -------


    Financing income                       199,436                    182,715                     200,765

    Financing expenses                   (422,471)                 (566,483)                  (374,599)
                                          --------                   --------                    --------


    Net financing
     expenses                            (223,035)                 (383,768)                  (173,834)
                                          --------                   --------                    --------


    Profit before taxes
     on income                             359,961                    616,404                     504,032

    Taxes on income                       (61,655)                 (136,455)                   (63,818)
                                           -------                   --------                     -------


    Profit for the year                    298,306                    479,949                     440,214
                                           =======                    =======                     =======


    Attributable to:

    Owners of the
     Company                               230,927                    445,771                     425,741

    Non-controlling
     interests                              67,379                     34,178                      14,473
                                            ------                     ------                      ------


                                           298,306                    479,949                     440,214
                                           =======                    =======                     =======


    Basic earnings per
     share (in NIS)                           0.58                       1.12                        1.07
                                              ====                       ====                        ====


    Diluted earnings per
     share (in NIS)                           0.57                       1.12                        1.07
                                              ====                       ====                        ====


    Consolidated Financial Statements
    ---------------------------------


    Operating Segments

                                                                          Year ended December 31, 2017
                                                                          ----------------------------

                                                          Infrastructures                 Infrastructures

                                                                      and                             and  Real estate       Real estate

                                                             construction                    construction  development       development                    Renewable

                                                          (international)                        (Israel)     (Israel)   (international)    Concessions        energy      Other       Adjustments        Consolidated
                                                           --------------                         -------      -------    --------------    -----------        ------      -----       -----------        ------------

                                                                               NIS thousands
                                                                               -------------

    External revenues                                           1,854,209                        3,229,094     1,382,599            247,775         145,359         36,689      37,939          (496,357)           6,437,307

    Inter-segment revenues                                              -                         291,770            76                  -              -             -          -         (291,846)                   -
                                                                      ---                         -------           ---                ---            ---           ---        ---          --------                  ---

    Total revenues from work performed and sales                1,854,209                        3,520,864     1,382,675            247,775         145,359         36,689      37,939          (788,203)           6,437,307

    Segment costs                                               1,718,057                        3,397,633     1,080,708            171,682          66,398         37,789     138,995          (930,985)           5,680,277
                                                                ---------                        ---------     ---------            -------          ------         ------     -------           --------            ---------

    Segment results                                               136,152                          123,231       301,967             76,093          78,961        (1,100)  (101,056)           142,782              757,030


    Net operating expenses for all segments                                                                                                                                                                (174,034)
                                                                                                                                                                                                            --------

    Operating profit                                                                                                                                                                                         582,996

    Net financing income (expenses) allocated to segments         (6,108)                         (8,628)     (27,275)          (28,382)         41,470          8,077     (8,409)          (35,176)            (64,431)

    Net financing expenses not allocated to segments                                                                                                                                                       (158,604)
                                                                                                                                                                                                            --------

    Segment profit (loss) before income tax                       130,044                          114,603       274,692             47,711         120,431          6,977   (109,465)         (225,032)             359,961
                                                                  =======                          =======       =======             ======         =======          =====    ========           ========              =======

    Additional information:
    -----------------------

    Segment assets                                              3,919,808                        2,555,498     3,806,622          1,164,247         527,631        521,311     202,121          (764,322)          11,932,916
                                                                =========                        =========     =========          =========         =======        =======     =======           ========

    Investment and loans to associates                                  9                           22,364       115,367            249,980         700,895          4,043     281,857                  -           1,374,515
                                                                      ===                           ======       =======            =======         =======          =====     =======                ===

    Assets not allocated to segments                                                                                                                                                                         253,705
                                                                                                                                                                                                             -------

    Total consolidated assets                                                                                                                                                                             13,561,136
                                                                                                                                                                                                          ==========

    Segment liabilities                                         1,270,769                        2,097,024     2,620,016          1,077,656         694,223        397,521     270,530        (1,083,551)           7,344,188
                                                                =========                        =========     =========          =========         =======        =======     =======         ==========

    Excess of losses over investment in investees                  28,291                                -       10,231                  -              -         4,968           -                 -              43,490
                                                                   ======                              ===       ======                ===            ===         =====         ===               ===

    Liabilities not allocated to segments                                                                                                                                                                  4,081,710
                                                                                                                                                                                                           ---------

    Total consolidated liabilities                                                                                                                                                                        11,469,388
                                                                                                                                                                                                          ==========

    Long-term investments in assets                                32,247                           48,510        68,696              1,950             607          6,263      23,133                  -             181,406
                                                                   ======                           ======        ======              =====             ===          =====      ======                ===

    General investments in assets for the long-term                                                                                                                                                           10,451

    Total investments in assets for the long-term -

     consolidated                                                                                                                                                                                            191,857
                                                                                                                                                                                                             =======

    Depreciation and amortization                                 135,408                           49,897        18,881              5,118               -        15,037      95,622              (438)             319,525
                                                                  =======                           ======        ======              =====             ===        ======      ======               ====

    General depreciation                                                                                                                                                                                      11,788
                                                                                                                                                                                                              ------

    Total depreciation - consolidated                                                                                                                                                                        331,313
                                                                                                                                                                                                             =======


    Consolidated Financial Statements
    ---------------------------------


                                                                          Year ended December 31, 2016
                                                                          ----------------------------

                                                          Infrastructures                 Infrastructures

                                                                      and                             and  Real estate       Real estate

                                                             construction                    construction  development       development                    Renewable

                                                          (international)                        (Israel)     (Israel)   (international)    Concessions        energy       Other       Adjustments        Consolidated
                                                           --------------                         -------      -------    --------------    -----------        ------       -----       -----------        ------------

                                                                               NIS thousands
                                                                               -------------

    External revenues                                           1,489,712                        2,324,394     1,278,810            146,254         427,383         44,679       40,259          (372,528)           5,378,963

    Inter-segment revenues                                        142,574                          444,259            76                  -              -             -           -         (586,909)                   -
                                                                  -------                          -------           ---                ---            ---           ---         ---          --------                  ---

    Total revenues from work performed and sales                1,632,286                        2,768,653     1,278,886            146,254         427,383         44,679       40,259          (959,437)           5,378,963

    Segment costs                                               1,312,877                        2,685,902       978,106            126,888          91,155          4,492       80,205        (1,074,171)           4,205,454
                                                                ---------                        ---------       -------            -------          ------          -----       ------         ----------            ---------

    Segment results                                                                                                                                                                                           1,173,509

    Net operating expenses for all segments                       319,409                           82,751       300,780             19,366         336,228         40,187     (39,946)           114,734            (173,337)
                                                                                                                                                                                                               --------

    Operating profit                                                                                                                                                                                          1,000,172

    Net financing income (expenses) allocated to segments       (162,079)                           (144)      (3,628)          (21,498)         18,965       (17,995)     (6,766)          (26,019)           (219,164)

    Net financing expenses not allocated to segments                                                                                                                                                          (164,604)
                                                                                                                                                                                                               --------

    Segment profit (loss) before income tax                       157,330                           82,607       297,152            (2,132)        355,193         22,192     (46,712)         (249,226)             616,404
                                                                  =======                           ======       =======             ======         =======         ======      =======           ========              =======

    Additional information:
    -----------------------

    Segment assets                                              4,339,515                        2,829,745     4,842,449            877,053       1,057,995        313,365      301,671          (727,944)          13,833,849
                                                                =========                        =========     =========            =======       =========        =======      =======           ========

    Investment and loans to associates                             23,829                           49,257       112,294            153,323         599,010          8,775      307,741                  -           1,254,229
                                                                   ======                           ======       =======            =======         =======          =====      =======                ===

    Assets not allocated to segments                                                                                                                                                                             89,972
                                                                                                                                                                                                                 ------

    Total consolidated assets                                                                                                                                                                                15,178,050
                                                                                                                                                                                                             ==========

    Segment liabilities                                         1,441,237                        2,316,586     3,887,424            769,551       1,115,350        196,740      384,871        (1,041,509)           9,070,250
                                                                =========                        =========     =========            =======       =========        =======      =======         ==========

    Excess of losses over investment in investees                  17,572                                -        9,689                  -          2,059          1,120            -                 -              30,440
                                                                   ======                              ===        =====                ===          =====          =====          ===               ===

    Liabilities not allocated to segments                                                                                                                                                                     4,006,219

    Total consolidated liabilities                                                                                                                                                                           13,106,909

    Long-term investments in assets                                39,389                           48,488        50,279              1,298          82,132          3,302       69,043                  -             293,931
                                                                   ======                           ======        ======              =====          ======          =====       ======                ===

    General investments in assets for the long-term                                                                                                                                                               9,644
                                                                                                                                                                                                                  -----

    Total investments in assets for the long-term -

     consolidated                                                                                                                                                                                               303,575
                                                                                                                                                                                                                =======

    Depreciation and amortization                                 160,847                           42,233        18,877              5,060               -        10,661       24,924              (472)             262,130
                                                                  =======                           ======        ======              =====             ===        ======       ======               ====

    General depreciation                                                                                                                                                                                         10,467
                                                                                                                                                                                                                 ------

    Total depreciation - consolidated                                                                                                                                                                           272,597
                                                                                                                                                                                                                =======


    Consolidated Financial Statements
    ---------------------------------


                                                                          Year ended December 31, 2015
                                                                          ----------------------------

                                                          Infrastructures                 Infrastructures

                                                                      and                             and  Real estate       Real estate

                                                             construction                    construction  development       development                    Renewable

                                                          (international)                        (Israel)     (Israel)   (international)    Concessions        energy      Other       Adjustments        Consolidated
                                                           --------------                         -------      -------    --------------    -----------        ------      -----       -----------        ------------

                                                                               NIS thousands
                                                                               -------------

    External revenues                                           1,962,078                        1,908,324       985,329             76,859         245,599        156,789      45,494          (311,770)           5,068,702

    Inter-segment revenues                                         26,191                          249,166            76                  -              -             -          3          (275,436)                   -
                                                                   ------                          -------           ---                ---            ---           ---        ---           --------                  ---

    Total revenues from work performed and sales                1,988,269                        2,157,490       985,405             76,859         245,599        156,789      45,497          (587,206)           5,068,702

    Segment costs                                               1,657,137                        2,108,905       728,772             60,695         212,602        113,371     (1,429)         (647,807)           4,232,246
                                                                ---------                        ---------       -------             ------         -------        -------      ------           --------            ---------

    Segment results                                               331,132                           48,585       256,633             16,164          32,997         43,418      46,926             60,601              836,456

    Net operating expenses for all segments                                                                                                                                                                  (158,590)
                                                                                                                                                                                                              --------

    Operating profit                                                                                                                                                                                           677,866

    Net financing income (expenses) allocated to segments        (11,325)                         (6,130)        7,813           (12,641)        (2,003)       (3,000)     10,396             28,293               11,403

    Net financing expenses not allocated to segments                                                                                                                                                         (185,237)
                                                                                                                                                                                                              --------

    Segment profit (loss) before income tax                       319,807                           42,455       264,446              3,523          30,994         40,418      57,322          (254,933)             504,032
                                                                  =======                           ======       =======              =====          ======         ======      ======           ========              =======

    Additional information:
    -----------------------

    Segment assets                                              4,741,172                        1,938,822     4,523,613            614,425         947,270        387,997     282,111          (673,771)          12,761,639
                                                                =========                        =========     =========            =======         =======        =======     =======           ========

    Investment and loans to associates                                  9                           56,824        71,700            169,981         414,256         81,084     507,344                  -           1,301,198
                                                                      ===                           ======        ======            =======         =======         ======     =======                ===

    Assets not allocated to segments                                                                                                                                                                           228,115
                                                                                                                                                                                                               -------

    Total consolidated assets                                                                                                                                                                               14,290,952
                                                                                                                                                                                                            ==========

    Segment liabilities                                         1,882,461                        1,385,069     3,497,860            505,113         973,261        282,166     317,620          (689,826)           8,153,724
                                                                =========                        =========     =========            =======         =======        =======     =======           ========

    Excess of losses over investment in investees                  16,712                                -        9,233                  -          2,999              -          -                 -              28,944
                                                                   ======                              ===        =====                ===          =====            ===        ===               ===

    Liabilities not allocated to segments                                                                                                                                                                    4,269,985
                                                                                                                                                                                                             ---------

    Total consolidated liabilities                                                                                                                                                                          12,452,653
                                                                                                                                                                                                            ==========

    Long-term investments in assets                                80,741                           72,297       151,820             31,439               -         1,003      40,557                  -             377,857
                                                                   ======                           ======       =======             ======             ===         =====      ======                ===

    General investments in assets for the long-term                                                                                                                                                             14,013
                                                                                                                                                                                                                ------

    Total investments in assets for the long-term -

     consolidated                                                                                                                                                                                              391,870
                                                                                                                                                                                                               =======

    Depreciation and amortization                                 185,118                           24,428        17,172              2,417               -         8,416     (5,522)             (472)             231,557
                                                                  =======                           ======        ======              =====             ===         =====      ======               ====

    General depreciation                                                                                                                                                                                         8,124
                                                                                                                                                                                                                 -----

    Total depreciation - consolidated                                                                                                                                                                          239,681
                                                                                                                                                                                                               =======

View original content:http://www.prnewswire.com/news-releases/shikun--binui-announces-full-year-2017-financial-results-300622429.html

SOURCE Shikun & Binui Ltd.