Israel Land Development Reports First Quarter Results; Company Updates Current Status.Business Editors TEL AVIV Tel Aviv (tĕl əvēv`), city (1994 pop. 355,200), W central Israel, on the Mediterranean Sea. Oficially named Tel Aviv–Jaffa, it is Israel's commercial, financial, communications, and cultural center and the core of its largest , Israel--(BUSINESS WIRE)--May 31, 2001 The Israel Israel, in the Bible Israel (ĭz`rēəl, ĭz`rāəl) [as understood by Hebrews,=he strives with God], according to the book of Genesis, name given to Jacob as eponymous ancestor of the Hebrews, the chosen people of God. Land Development Company Ltd. ("the Company" or "ILDC ILDC Independent Lumber Dealers Co-operative ILDC Incremental Length Diffraction Coefficient ") (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :ILDCY) today announced the condensed con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. financial statements of the Company and its subsidiaries ("the ILDC Group" or "the Group") for the period ended March 31, 2001. A description of the Corporation and its Business Environment ILDC is engaged in a number of fields of operations, the main ones of which are described below, mainly through subsidiaries some of which are public companies whose shares are traded on the Tel Aviv Stock Exchange Tel Aviv Stock Exchange Israel's only stock exchange. Ltd., and which publish separate financial statements on their operations. The main fields of operations are: - Real estate and hotels - initiation, development, execution and sale of projects and the leasing and management of income producing properties throughout the country, as well as the ownership and management of a chain of hotels throughout the country. - Communications - publishing newspapers, local newspapers and journals, electronic communications, compact discs and tapes, books and multimedia products, commercial printing and billboards. - Insurance and finance - Operations in all field of general insurance, life insurance and credit insurance and since 1999, in financial fields. - Investments - investments in companies in various fields of operation. Events after the balance sheet date Prospectus - on May 30, 2001 the Company's Board of Directors approved submission of a prospectus for rights and bonds (Series 10), according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. which a series of bonds will be issued for a total amount of NIS Niš or Nish (both: nēsh), city (1991 pop. 175,391), SE Serbia, on the Nišava River. An important railway and industrial center, it has industries that manufacture textiles, electronics, spirits, and locomotives. 200 million par value, for an average period of 10 years. The rights for the purchase of the series of bonds will be offered to the Company's shareholders in consideration for a price considerably lower than their par value. The difference between the value of the bonds soon after their issue and the payment actually paid by the shareholders will be recognized as a dividend for all intents and purposes Adv. 1. for all intents and purposes - in every practical sense; "to all intents and purposes the case is closed"; "the rest are for all practical purposes useless" for all practical purposes, to all intents and purposes . The balance of the series of bonds will be offered to the public, and part will be purchased by a subsidiary of the Company. Restatement Restatement A revision in a company's earlier financial statements. Notes: The need for restating financial figures can result from fraud, misrepresentation, or a simple clerical error. - On May 30, 2001 the Company's Board of Directors re-approved the financial statements for 2000 which were adjusted by way of restatement in order to reflect retroactively ret·ro·ac·tive adj. Influencing or applying to a period prior to enactment: a retroactive pay increase. [French rétroactif, from Latin the effects of an amendment in registering capital gains from the sale of the shares of Gibor Sport Holdings Ltd. ("Gibor"). The reduction in the capital gains results from expressing an element of profit relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc an asset belonging to Gibor, Optima Promotions and Investment Management 66 Ltd. ("Optima") which was purchased by the Company. Optima is consolidated in the Company's financial statements as of the third quarter of 2000. The said change will reduce the capital gains that the Company registered by about NIS 0.9 million. For the effect of changes in the financial statements for 2000 see Note 4 to the condensed financial statements attached hereto here·to adv. To this document, matter, or proposition. hereto Adverb Formal or law to this place, matter, or document Adv. 1. . Delisting Delisting When the stock of a company is removed from a stock exchange. Notes: Reasons for delisting include violating regulations and/or failure to meet financial specifications set out by the stock exchange. the Company's shares abroad - On May 30, 2001 the Company's Board of Directors decided to take the steps required in order to delist delist To drop a security from trading on an organized exchange. Delisting may occur for a number of reasons including failure to meet an exchange's standards or placement of a new listing on another exchange. Compare list. the Company's shares from trading in New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , and this is mainly due to considerations of the low marketability Marketability A negotiable security is said to have good marketability if there is an active secondary market in which it can easily be resold. marketability The ease with which an investment may be bought and sold in the secondary market. of the shares abroad and the high cost resulting from the continued double listing. Financial condition The consolidated balance sheet consolidated balance sheet A balance sheet in which assets and liabilities of a parent company and its controlled subsidiaries are combined, thereby presenting balance sheet items for the parent and its subsidiaries as if they were a single firm. of ILDC and its subsidiaries on March 31, 2001 totaled NIS 4,722 million, compared to NIS 4,627 million on December December: see month. 31, 2000 and compared to NIS 4,179 million on March 31, 2000. The main increase in the balance sheet since the beginning of the year is a result of an increase in current assets Current Assets Appearing on a company's balance sheet, it represents cash, accounts receivable, inventory, marketable securities, prepaid expenses, and other assets that can be converted to cash within one year. , most of which is an increase in insurance premiums and balances of agents receivable totaling NIS 45 million and an increase in the balances of insurance companies and insurance brokers of NIS 12 million, which reflect an increase in the level of sales of the insurance company, an increase in the balance of receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed of NIS 18 million mainly in the Hed Artzi and Maariv publishing companies. In addition, inventories increased by NIS 10 million mainly due to the increase in the level of inventories and the prices of paper in Maariv's stores. Results of operations In the first quarter of 2001 ILDC registered a net consolidated loss of NIS 16.8 million compared to an income of NIS 26.9 million for the first quarter of the previous year. The transition to a loss results from a combination of reasons, the two main reasons being: - Financing expenses of NIS 22.9 million in the first quarter of 2001, compared to financing revenues totaling NIS 4.9 million in the equivalent quarter in 2000, and this mainly due to the financing costs of loans taken as project financing Project financing A form of asset-based financing in which a firm finances a discrete set of assets on a stand-alone basis. for the erection erection /erec·tion/ (e-rek´shun) the condition of being rigid and elevated, as erectile tissue when filled with blood. e·rec·tion n. 1. of the Herzliya Shopping Mall, due to the end of its construction and the start of operations. - The Company's share in the financial results of affiliated companies, net, resulted in a loss of NIS 12.4 million, compared to a loss of NIS 0.5 million in the first quarter of the previous year, mainly due to the Company's share in the losses of Matav. Matav Ltd. is a public company that publishes separate financial statements, according to which its losses derive mainly of its share in Partner Communication's results and of financing expenses and expenses related to the purchase of contents. - In the equivallent quarter of 2000, the Company had capital gains from Gibor Sprort Holdings, in which the Company no longer has holdings as of balance sheet date. The operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. of the Company from the operations of its subsidiaries, after offsestting capital gains and financing revenues, amounted in the first quarter of 2001 to NIS 18.24 million compared to NIS 22.85 million in the first quarter in 2000. This change is comprised of a 26% increase in the operating revenues operating revenue Revenue from any regular source. Revenue from sales is adjusted for discounts and returns when calculating operating revenue. Compare other revenue. from real estate businesses compared to the equivallent quarter in 2000, which was offset by the decrease in operating revenues from the communication businesses. For a review of the results of operations of the various subsidiaries - see below. The following is a condensed review of the results of operations of the Group in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with the fields of operations (in NIS thousands)
For the three months ended
Details March 31
2001 2000
Revenues
From real estate 35,452 43,647
From communications business 215,827 216,487
From operating hotels 12,006 18,382
From insurance business 161,140 140,336
From heart medical services 6,087 7,056
Other revenues, net - 4,871
Capital gains, net 13,732 15,273
Total 444,244 446,052
Costs and expenses
From real estate business 19,735 31,168
From communications business 213,042 207,890
From operating hotels 16,394 22,165
From operating insurance business 155,261 134,207
From heart medical services 7,844 7,627
Financing, net 22,854 -
General, administrative and other 9,284 9,338
Total 444,414 412,395
Income (loss) before taxes on income (170) 33,657
Tax on income 10,512 10,770
Income (loss) after taxes on income (10,682) 22,887
Company share in losses of affiliated
companies, net (12,429) (481)
Minority share in losses of subsidiaries 6,309 4,459
Net profit (loss) for the period (16,802) 26,865
The following are the main details of the operating results of the Group's main subsidiaries: Real Estate Business Construction business Since the beginning of 2001 ILDC has not engaged in any significant construction project and is engaged in a number of construction projects for residential purposes. The main part of the Company's profits from real estate business in the quarter under review result from income producing real estate, and this compared to the equivalent quarter in the previous year, where the share of this item was lower. The reasons for change in the mix of profitability are an increase in the profitability of income producing real estate, which during the quarter under report totaled NIS 12.3 million compared to NIS 6.9 million, and a result of the opening of the shopping mall in Herzliya. The total amount of operating income from real estate business during the first quarter of 2001 increased and totaled NIS 15.7 million compared to NIS 12.5 million for the first quarter of the previous year. Communications business The Maariv Group During the first quarter of the year the Maariv Group registered operating income, before financing expenses totaling NIS 4.2 million, compared to NIS 6.9 million for the equivalent quarter in the previous year. The decline in profitability results from maintaining a similar level of revenues concurrently with increasing cost of sales, as a result of the increase in paper prices. Hed Artzi Group The Hed Artzi Group in the first quarter of 2001 registered an operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. totaling NIS 2.0 million, which is higher than the operating loss in the equivalent quarter in the previous year which reached NIS 1.5 million. The decline in profitability, despite the increase in revenues and the decrease in general and administrative expenses, is due to increasing selling and marketing expenses, mainly in the retail chains, resulting from the continuing recession. Rapid Ltd. Rapid Shilut Hutzot Ltd. in the quarter under review registered operating income of NIS 1.6 million, compared to operating income of NIS 3.2 million for the equivalent period in the previous year. The decline in operating income results from an exceptional decline in sales turnover in January this year, which does not reflect a trend - in February and March the rate of sales was simillar to the previous year. Concurrently, the items of expenses in this company also dropped. The income of Rapid include in the reviewed quarter, for the first time, income from the subsidiary Rapid Vision, which is engaged in electronic billboards. At the date of signing the financial statements, there are 4 operating electronic billboards, and 8 more are expected to be operated until the end of 2001. Insurance business The ILDC Group's insurance business of the produced operating income of NIS 5.9 million compared to operating income of NIS 6.1 million during the equivalent period of 2000, and this due to the increase in the volume of revenues from insurance business, concurrently with a proportional proportional values expressed as a proportion of the total number of values in a series. proportional dwarf the patient is a miniature without disproportionate reductions or enlargements of body parts. increase in expenses. General insurance business during the first quarter of the year produced higher income compared to the equivalent quarter in the previous year, and this mainly as a result of a revision of insurance tariffs This is a list of tariffs and trade legislation:
Hotel business Operating income of the hotel business in the first quarter of 2001 totaled NIS 4.4 million compared to a loss of NIS 3.8 million in the equivalent quarter in the previous year. The hotel business continues to be affected by the continued decline in the political, security and economic situation. The Galei Kinneret Hotel in Tiberias was closed, and The Ma'ayan Hotel in Nazareth is only partially operating. The Company estimates that the hotel business will continue to show losses as long as the external factors mentioned above do not improve significantly. Liquidity and sources of finance In the first quarter of 2001 net cash resulting from operating activities of the ILDC Group totaled NIS 12.0 million, compared to cash used for operating activities of NIS 23.9 million for the first quarter of 2000. This decline is a result of a transition to losses in the Company's consolidated statements, an increase in the Company's share in the losses of affiliated companies Affiliated Companies A situation that occurs when one company owns a minority interest (less than 50%) in another company. Also refers to companies that are related to each other in some way. Notes: An affiliated company is sometimes referred to as a subsidiary. and changes in the adjustments required as a result of the operations of the insurance company. The total amount of cash used for investing activities reached NIS 47.5 million compared to an amount of NIS 106.8 million resulting from investment operations in the first quarter of the previous year. The main investing activities in the quarter under report were as follows: - NIS 4.8 million were invested in long term deposits with banks and NIS 6.3 million were invested in a trust deposit relating to the acquisition of shares of Telad Ltd. - An amount of NIS 9.2 million were used to grant short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. loans. - During the quarter the amount of NIS 3.6 million was received as a dividend from Telad Ltd. compared to an amount of NIS 38.4 million which were received as a dividend from affiliated companies in the first quarter of 2000. During the first quarter of the year the amount provided by financing activities totaled NIS 17.9 million, compared to NIS 21.6 million used for financing activities in the equivalent quarter in the previous year. The main financing activities which affected this amount is the receipt of short-term bank credit of NIS 34.8 million compared to short-term bank credit of NIS 11.0 million received in the first quarter of 2000. Legal proceedings All actions that are authorized or sanctioned by law and instituted in a court or a tribunal for the acquisition of rights or the enforcement of remedies. Regarding the legal proceedings against ILDC Insurance, a subsidiary, and legal proceedings against Matav Ltd., see Note 5 to the condensed financial statements. Qualitative report regarding exposure to market risks and the method of their management There has been no change since the beginning of the year. |
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