2015 results. March 2016

Transcription

1 2015 results March 2016

2 Contents Kardan Highlights 6-12 Real Estate Asia (Kardan Land China) Water Infrastructure (Tahal Group International) Financial Services (TBIF) Outlook Contact details 27 APPENDIX: Kardan 2015 Financials

3 Kardan Emerging markets player Mainly Asia, Africa & CEE Initiates, develops, manages projects & assets Strategic & managerial control Focus on middle-class needs Real Estate, Water Infrastructure, Banking & Retail Lending Corporate Governance Listed: Amsterdam & Tel-Aviv One Tier Board Local platforms Decentralized operations: local operational management Optimize opportunities & minimize risks 3

4 Kardan Group Kardan N.V. 100% 98% 100% Real Estate Kardan Land China Water Infrastructure Tahal Financial Services TBIF GTC RE 67% TGI 14% KFS 19% 100% *Net investment on the basis of Equity investment and shareholders loans as of

5 2015 Financial Highlights Kardan Contribution to net result millions Q1 / 15 Q2 / 15 Q3/15 Q4/ Q4/ Real Estate Asia (4.1) (4.0) Water Infrastructure (6.8) (1.5) Financial Services Total operations (1.0) Others: (Corporate G&A, Finance, Tax, Discontinued ops) Total Profit (Loss) for equity holders Other comprehensive income/ (loss) to KNV Total Comprehensive Income/ (Loss)* to KNV equity holders (37.5) (14.9) 2.9 (17.1) (66.6) 0.6 (25.6) (7.4) (1.7) 4.3 (18.1) (22.9) (8.3) (12.7) 3.8 (2.0) (10.0) (8.4) (14.3) (24.9) (*) Total Comprehensive Income / Loss: net result combined with direct equity impact of forex differences and changes in hedge reserves 5

6 2015 Financial Highlights Kardan Q mn consolidated net loss to equity holders (Q4/14: 16.5 mn net profit) Financing expenses of 16.7 mn (2014: 2.5 mn income) including 10 mn impact predominantly due to adverse NIS/Euro forex (Q4 2014: 6.2 mn positive impact) mn consolidated net loss to equity holders (2014: 5.1 mn net profit) Positive net contributions from all operating segments including 20 mn net gain on sale of KWIG Financing expenses of 60.1 mn (2014: 19 mn) including 33 mn impact predominantly due to adverse NIS/Euro forex (2014: 3.8 mn negative impact) Total Comprehensive Loss 24.9 mn (2014: 32.0 mn profit) Shareholders equity as at December 31, 2015: 71.5 mn (year-end 2014: 92.4 mn) 6

7 2015 Highlights Kardan Main Events in chronological order: Sale of KWIG: (75% concluded in Q1, 25% planned to be finalized in H1 2016) Sale of TBI Credit concluded Early repayment of interest + principals of Debentures ( 25.4 mn in total) Early repayment FIMI loan by Tahal and amended agreement signed ending the option and shareholders agreement Tahal signs agreement for project (approx. 67 mn) in India Amended Deeds of Trust regarding debt settlement with Debenture Holders signed Rating upgraded by Standard & Poor s to B Sale of Building B (Europark Dalian project in China, 262 apartments) for RMB 481 mn (approx. 68 mn) 7

8 Highlights Kardan (continued) Opening ceremony of Galleria Dalian, China Kardan Land Dalian signs new credit facility (up to RMB 1 bn) to refinance existing loan and for ongoing business needs; releases pledge of RMB 95 mn Subsequent events: Settlement reached in amount of 4mn with buyer of GTC SA regarding claw back claims (totaling 6.3 mn) Sale agreement signed for TBIF, holding banking and retail lending activities, for an initial consideration of approximately 69 mn; initial gain estimated at 14 mn Announcement of resignation of CEO Shouky Oren and appointment of Ariel Hasson (currently CEO of Kardan Financial Services) as new CEO of Kardan N.V as of April 15,

9 Maturity of liabilities* Company Only Kardan N.V. (and GTC RE) (principal only, December 31, 2015) (EUR million) Total Debentures Series A** Debentures - Series B** Total (*) According to the approved Debt Settlement with the Debenture Holders (**) Net of debentures held by subsidiaries 9

10 Kardan debt development * Gross debt of Kardan NV and GTC RE Debentures Loans from banks (*)Company Only Kardan N.V. & GTC RE as at December 31, 2015; principals only are presented as per January 1 of each year and exclude accrued interest and hedges and are presented according to the approved Debt Settlement with the Debenture Holders. Net of debentures held by subsidiaries. The gross debt presented up to December 31, 2015, is presented according to actual forex rates (NIS to Euro); looking forward the NIS / Euro exchange rate of December 31, 2015 has been applied. 10

11 Cash flow forecast Kardan Company only - Kardan N.V. & GTC RE Sources January 1, 2016 December 31, 2017 millions Cash & ST investments as at Sale of assets Total sources Uses Claw back 4.0 Series A debentures (principal) 42.1 Series B debentures (principal) 43.5 Interest expenses 48.0 G&A expenses less management fees 8.0 Total uses Expected cash & short term investments at :

12 Real Estate Asia Kardan Land China 100%

13 Characteristics of Chinese Real Estate sector Impact of Urbanization on real estate development Growth of the middle class in China in 60 selected large and growing cities (number of households earning > RMB 30k / y) Source: JonesLangLasalle, China60: From fast growth to smart growth 13

14 Real Estate Asia 2015 highlights EBIT: Revaluation Dalian: Apartments delivered: Currency: Net profit to Kardan: 13.6 mn profit (2014: 28.5 mn profit, including 16.8 gain on sale Galleria Chengdu) 20.9 mn (2014: 8.9 mn) 2,012 (4 Dalian) (2014: 1,730 of which 250 Dalian) Lower prices of apartments, impairment part of inventory & absence of rent Galleria Chengdu impacts equity earnings Impact of appreciation RMB versus Euro 8.9 mn (2014: 24.6 mn) Apartments sold: 1,389; incl. 262 Building B (2014: 1,254; incl. 201 Building A2) Residential Apartments Delivered Sold

15 Europark: opening Galleria Dalian (August 2015) 15

16 Galleria Dalian Location: - Dalian: city with approx. 7 million residents and one of China s fastest growing cities - next to Davos Center and near renewed port: many visitors - green surroundings - connected to new subway station & offering sufficient parking space 65,000 square meter net rentable area Tenants include large international retailers Approximately 71% signed tenancy agreements at present Focuses on comprehensive lifestyle concept, combining the shopping experience with entertainment (IMAX cinema, fitness centers, Kid s floor, Restaurants etc.) Designed by international architects: La Guardia-Luo Won several real estate awards during construction 16

17 Europark: signing sale of Building B (August 2015) Europark Building B: - Sale agreement Building B to Fraser Suite Dalian - Consideration: RMB 481 mn (approx. 68 mn), of which 50% currently paid - Core & Shell completed; interior according to specific design under construction serviced apartments + 14 parking spaces - Estimated delivery: Q

18 Water Infrastructure Tahal Group International 98%

19 Tahal s contribution to the water value chain Operational in all encircled activities Source: RobecoSAM, Water : the market of the future 19

20 Water Infrastructure 2015 highlights Revenue up (y-o-y) by 18%: mainly positive forex impact (USD and NIS appreciation versus Euro) Lower gross margin (y-o-y): different mix of projects and 2014 included high margin of large project EBIT: 6.4 mn (2014: 8.9 mn) Financing expenses: no credit facility use, offset by one-off charge of 3 mn (prepayment of FIMI loan) Sale of KWIG contributed 20.1 mn net profit Net profit to Kardan: 21.5 mn (2014: 1.5 mn loss) - excl. gain KWIG + FIMI impact: 4.4 mn profit (2014: 2.4 mn profit) Backlog: USD 311 mn (year-end 2014: USD 358 mn) Many project tender proposals outstanding 20

21 Water infrastructure activities worldwide 21

22 Financial Services Kardan Financial Services 100%

23 Banking & Retail Lending 2015 highlights Total income, net 2015 up 7% (y-o-y): - higher interest income from better quality portfolios - lower interest expenses on higher deposit base - lower fees & commission income Other income (net)up substantially; growth of account services incl. F/X Avis (equity earnings): strong y-o-y growth 2015 despite continuing instability in Ukraine Net profit to Kardan: 13.3 mn (2014: 7.6 mn profit) 23

24 Outlook 2016 Kardan N.V.: Improving results from segments Continued focus on generating cash to service the debt It is noted that Kardan has a significant exposure to currency movements: - Kardan reports in Euro - Liabilities are in NIS - Assets are predominantly in RMB 24

25 Thank you Disclaimer This presentation has been prepared on behalf of Kardan N.V. solely for information purposes. It is not an investment advice or an offer or solicitation for the purchase or sale of any financial instrument. While reasonable care has been taken to ensure that the information contained herein is not untrue or misleading at the date of the presentation, Kardan N.V. makes no representation that it is accurate or complete. The information contained herein is subject to change without notice. Neither Kardan N.V. nor any of its officers or employees accepts any liability for any direct or consequential loss arising from any use of this presentation or its contents. Copyright and database rights protection exist in this presentation and it may not be reproduced, distributed or published by any person for any purpose without the prior express consent of Kardan N.V. All rights are reserved. 25

26 Investor Relations Contact details The Netherlands Caroline Vogelzang Ohad Lev Israel Office: Mobile: Office: Mobile: Kardan N.V. Claude Debussylaan 30 Viñoly Building, 13th floor 1082 MD Amsterdam The Netherlands Kardan N.V. 154 Menachem Begin Rd. Tel Aviv Israel

27 Appendix Kardan 2015 financials

28 2015 Consolidated Income Statement In million Real Estate Asia Water Infrastructure Banking & Retail Lending Other Total 2015 Total 2014 Total Revenues Total Expenses Profit(loss) from operation before fair value adjustments, disposal of assets and financial expenses Profit(loss) from fair value adjustments, disposal of assets, investments and other income (expenses) (10.3) (5.1) (0.8) Result from operations before finance expenses (5.9) Financing income (expenses), net (1.6) (2.1) 3.4 (60.1) (60.4) (19.3) Equity earnings (losses) 2.6 (1.5) 1.7 (0.1) Profit (loss) before income tax (66.1) (34.5) 20.7 Income tax (expenses)/benefit (3.1) (2.9) (2.0) (0.5) (8.5) (13.0) Profit (Loss) from continuing operations (66.6) (43.0) 7.7 Profit (Loss) from discontinued operations ) (2.6) Profit (Loss) for the period to equity holders (66.6) (22.9) 5.1 Other comprehensive income (2.0) 26.9 Total Comprehensive Income to equity holders (24.9)

29 Real Estate Asia 2015 In million Full Year Y-o-Y development Delivery of units Dalian units in 2015 versus 250 (incl. 211 of A2 building) last year Rental income First rental income of Galleria Dalian Management fee and other revenues Asset mgt fees Galleria Dalian and Chengdu (lower due to change in contract after sale) Total revenues Cost of delivery of units Cost of rental income Other expenses, mgt & service recharge expenses, net Gross profit SG&A expenses Adjustment to fair value (impairment) of investment properties Gain on disposal of assets, other income & equity earnings 29 More marketing efforts Galleria Dalian, one-off expenses due to change in mgt and impact strong RMB Galleria Dalian, completed in Q2/ : more deliveries of units mitigated by impairments. 2014: includes 16.8 mn gain on sale of Chengdu. Result from operations before finance expenses Financing income (expenses), net (1.6) 5.4 Higher financing expenses (no longer capitalized) + significant effect of stronger RMB Income tax (expenses) / benefit (3.1) (9.3) 2014: impact Chengdu ( 5.5 mn) Net profit (loss) to Kardan N.V

30 Water Infrastructure 2015 In million Full Year Y-o-Y development Contract revenues Contract cost Gross profit Good progress in execution of projects and forex impact of strong USD and NIS Lower gross margin on different project mix (2014 included one-off high margin on large project) SG&A expenses Forex impact + higher amount re ESOP and bonus plans Gain (loss) on disposal of assets, other income and equity earnings (loss) (1.2) (0.8) Result from operations before financing expenses Financing income (expenses) net (2.1) (4.8) Less use of credit facilities more than off-set by 3 mn one-off charge due to early repayment FIMI loan following KWIG sale Income tax (expenses) / benefit (2.9) (3.0) Profit (loss) from continuing operations Net profit(loss) from discontinued operations (2.6) KWIG Excluding FIMI effect: 2015: 4.4 mn profit, 2014: 2.4 mn profit Net profit (Loss) to equity holders 21.5 (1.5) 30

31 Banking & Retail Lending In million Full Year Y-o-Y development Interest income Larger portfolio Interest expenses Lower deposits and lower interest rate; liquidity management Net interest income (expenses) Fees & commission income, net Other operating income, net Total income, net Impairment losses on loan portfolio, net : better quality portfolio Staff & other operating expenses : provisioning of employee option plans Gain on disposal of assets Operating profit Other income, net Increase in accounts services including F/X Other financing expenses Equity earnings Avis Ukraine Profit before tax Income tax (expenses) / benefits (2.0) (0.3) Net profit (loss) attributable to Kardan NV

32 Other expenses 2015 In million Full Year Y-o-Y development General & administrative expenses Other (income) expenses Provision GTC SA claw back liability Equity earnings (losses) (0.1) (0.1) Financing income (expenses), net (60.1) (19.0) Income tax expenses / (benefit) Net Profit (Loss) from corporate activities (66.6) (25.6) 2015: Includes 36 mn negative forex NIS/Euro) and positive 3mn CPI impact (2014: 3.8 negative impact) and higher interest following debt settlement 32