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Shikun & Binui Q1 revenue decreased

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Staff writer ▼ | May 27, 2014
Shikun & Binui Ltd. reported its financial results for the first quarter, ended March 31, 2014. Group's total revenue amounted to NIS 1,467 million, compared with NIS 1,621 million in Q1 of last year, a decrease of 9.5%.
Shikun Binui
Shikun BinuiShikun & Binui Ltd. reported its financial results for the first quarter, ended March 31, 2014. Group's total revenue amounted to NIS 1,467 million, compared with NIS 1,621 million in Q1 of last year, a decrease of 9.5%.


The decline of NIS 154 million is due mainly to the decrease of NIS 118 million in the construction and infrastructures outside of Israel segment (of which NIS 40 million is attributable to the erosion in exchange rates). In addition, a number of other factors contributed to the decline.

There was a NIS 81 million decrease in the real estate development in Israel segment, a NIS 74 million decrease in the turnover of the renewable energy segment, due to the decline in the volume of photovoltaic facilities built, and a NIS 56 million decrease in the turnover of the concessions segment, due to the completion of the building phase of the roadwork project in northern Israel and the transition to the operation phase.

Contrarily, the company posted an increase of NIS 113 million in the infrastructures and construction in Israel segment.

Gross profit in the first quarter of 2014 totaled NIS 230 million, compared with NIS 316 million in Q1 of 2013. The decrease was driven mainly by the decrease in the gross profit of the real estate development in Israel segment, as detailed below.

Administrative and general expenses in the quarter increased by NIS 14 million compared with the first quarter of last year, totaling NIS 90 million. The increase was driven mainly by the increase of NIS 5 million executive compensation costs (in respect of the granting of blocked shares of stock), and consultancy expenses for tenders in which the Company is bidding within and outside of Israel.

Other operating income, net totaled NIS 4 million in the reported period, compared with NIS 57 million in Q1 of last year, which included a NIS 55 million gain from the cancellation of a sale with the Ramat-Gan Municipality.

Group operating profit in the first quarter of the year totaled NIS 136 million, compared with NIS 290 million in Q1 of last year. The decrease was driven mainly by the decline of NIS 124 million in the operating profit of the real estate development segment, deriving from a NIS 68 million decrease in the segment's gross profit and the NIS 55 million gain recognized from the cancellation of the sale of land in the same period last year, as previously mentioned.

Net financing expenses in the first quarter of 2014totaled NIS 31 million, compared with NIS 46 million in Q1 of 2013. The decrease was driven mainly by a 0.7% decrease in the Consumer Price Index (CPI +0.08%) during the period, compared with an increase of 0.1% in the same period last year, which impacted the costs of CPI-linked credit and, contrarily, by a growth in the amount of credit, which contributed to a NIS 12 million increase in financing expenses.

Taxes on income in the reported quarter totaled NIS 32 million, compared with NIS 63 million in Q1 of 2013. The decrease was driven mainly by the reduction in tax expense, due to the decline posted in the real estate development in Israel segment.

Net Profit in the first quarter of 2014 totaled NIS 74 million, compared with NIS 156 million in Q1 of last year. The decrease was due to the reasons previously described.

Cash flow used in operating activities totaled NIS 68 million in the first quarter of 2014, compared with cash flow generated from operating activities of NIS 74 million in Q1 of last year. The NIS 142 million decrease was driven mainly by the purchase of land within and outside of Israel and an increase in tax payments, compared with NIS 100 million received last year of from cancellation of the sale that had been signed with the Ramat-Gan Municipality.

Balances of cash and cash equivalents as of March 31, 2014 totaled NIS 1,584 million. The company has unutilized credit facilities totaling NIS 1,123 million.


 

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