PR Newswire | Oct 27, 2021 07:19AM EDT

10/27 06:18 CDT

Gav Yam Reports Third Quarter 2021 Results TEL AVIV, Israel, Oct. 27, 2021

TEL AVIV, Israel, Oct. 27, 2021 /PRNewswire/ -- Gav Yam Land Corporation Ltd.(TASE: GVYM)one of Israel's largest and longest established real estate companies, specializing in the initiation, planning, development, construction, leasing, maintenance and management of hi-tech, logistics, and industrial parks and centers throughout Israel, today reported its financial report for the third quarter and the first nine months of 2021.

The results reflect a full return to routine, continued stability and growth across all operational parameters, and a significant acceleration in intensive entrepreneurial activity, including 13 projects, with a total area of 660,000m (of which 500,000m are the Company's share in the Company's consolidated financial statement), with a total investment of about NIS 4.5 billion (the Company's share in the consolidated financial statement). About 25% of the above-ground areas in these projects have been already marketed.

Financial Highlights

* Net profit attributed to shareholders amounted to NIS 695 million in the first nine months of 2021, compared with NIS 172 million, last year. The increase is mainly due to growth in income from the increase in the fair value of investment in real estate compared to the corresponding period last year. * The Company's cash flow from operating activities in the first nine months of the year amounted to NIS 364 million, an increase of 14% compared with the corresponding period last year. * The Company's rental income in the first nine months of 2021 amounted to NIS 408 million, compared with NIS 401 million in the corresponding period last year. * The Company's NOI in the first nine months of the year amounted to NIS 391 million, compared with NIS 388 million in the corresponding period last year. * EBITDA in the first nine months of 2021 amounted to NIS 363 million, compared with NIS 361 million in the corresponding period last year. * The FFO attributed to shareholders amounted to NIS 193 million in the first nine months of the year, an increase of 6.6% compared with the corresponding period last year.

Management Comment

Avraham Jacobovitz, CEO of Gav-Yam, commented: "High-tech companies, within the context of Israel as a leading technological power, established new development centers and hired employees at high intensity, which led to continued growth and lead market trends."

"Strong market demand continues and is driving the real estate industry forward and is leading to accelerated growth in the office space. New areas are being absorbed already during the construction stages. The office market in Tel Aviv and Herzliya are at the forefront and leading the trend, and it is expected to strengthen and grow in the coming years. High-tech companies have chosen to be an integral part of the Tel Aviv metropolitan and Herzliya area and lead the demand as part of a structured process, relying on high-quality human capital that is the main backbone of high-tech companies. Within the complex of Tel Aviv and Herzliya, the Toha1 and Toha2 towers and the Gav-Yam centers in Herzliya, constitute a central focus for the office market, in addition to other high-tech parks of Gav-Yam, and meet demand."

"Gav-Yam is seeing very strong demand, examining many deals and participating in all the tenders of international technology companies."

"Gav-Yam continues with great intensity on a very clear route of large-scale and intensive entrepreneurial activity, which includes 13 projects, with a total area of ~660,000 m (~500,000m, in terms of the Company's share in the consolidated financial statement), with a total investment of ~NIS 4.5 billion (the company's share in the consolidated financial statement)."

"The highlight is the ToHa2 project, with a total area of 210,000 m (~105,000 m the Company's share), a mega-project that is the spearhead of the Company's operations. We anticipate widespread demand in this project, at high rental prices."

"With the completion of these projects and their occupancy by the end of 2026, the Company's revenues will gradually increase to ~NIS 950 million per year. 25% of the above-ground areas in these projects have already been marketed."

In the first nine months of 2021, the company signed 123 leases, with an average real increase in rents of about 7.4% (in existing properties). "

Company Summary

Gav-Yam has 1,034,000m of properties, with a wide spread, both in geographic and sectoral terms across 19 cities around Israel, including 22 parks and high-tech centers, offices, logistics, industry and commerce. They are adjacent to main arteries, Class A premium buildings, with high LEED standards. In addition, the Company has reserves of available building rights, amounting to ~490,000 m.

The Company has about 430 customers, including large international companies, top-tier, as well as the largest technology corporations in the world. As of the end of 2020, the Company's backlog of signed lease agreements amounted to NIS 2.3 billion for income-producing properties, and NIS 2.75 billion including signed lease agreements for construction projects. The lease agreements last for an average of about 4.4 years.

The Company showed continued stability in all operational parameters and financial strength, which is reflected in cash balances of ~NIS 1.2 billion, leveraged at a rate of 51.2%, a debt-rating of AA by Maalot (S&P Israel affiliate), and 100% of the Company's assets are non-collateralized. The Company continued a trend of stability in occupancy levels of occupancy and rent increases.

The Company has strategic partnerships with the leading academic institutions in Israel. This is the next good news, which brings the highest quality technological manpower - both quantity and quality. Gav-Yam significantly deepens its activities and collaborations, which include, among others, the Hebrew University of Jerusalem, Ben-Gurion University of the Negev and the Weizmann Institute.

Gav-Yam has set itself the goal of expanding its activities in the field of logistics and industry centers, an expanding area, which is a stable anchor with great demand and is marked as one of the future engines for growth. Gav-Yam is currently initiating four projects in this field, with a total area of ~75,000 m, of which 65% have been marketed.

About Gav-Yam

Gav-Yam Land Corporation Ltd. is one of Israel's largest, longest established real estate companies.

The company specializes in the initiation, planning, development, construction, leasing, maintenance, and management of hi-tech, logistics, and industrial parks and centers nationwide, as well as in the construction of dedicated complexes planned for long-term leasing. Through a wholly owned subsidiary, Gav-Yam also provides a variety of maintenance management services to tenants throughout the leasing period.

Gav-Yam was founded in 1928, and has been listed on the Tel Aviv Stock Exchange since 1978. Today, the company's shares are included among the leading indices of real estate (Tel-Bond 60) and large companies (TA-125). In addition, the company's debentures are rated AA by S&P Maalot and Aa2 by Midroog.

Contact Information

Investor Relations Contacts Company Contact

GK Investor & Public Relations Mark Zack

Ehud Helft CFO

+1 212 378 8040 +972 4 66 44 222

gavyam@gkir.com mark@gav-yam.co.il

Condensed Consolidated Interim Statement of Financial Position

September 30 September 30 December 31

2021 2020 2020

(Unaudited) (Unaudited) (Audited)

NIS thousands NIS thousands NIS thousands

Assets

Cash and cash equivalents 304,641 1,968,386 1,715,381

Short-term investments and deposits 864,454 594,826 823,674

Trade receivables 6,199 5,330 4,480

Other receivables 234,469 91,670 104,631

Current tax assets 14,847 215 427

Total current assets 1,424,610 2,660,427 2,648,593

Long term receivables 57,782 57,537 48,371

Investments and loans in 239,388 151,382 194,442equity-accounted investees

Fixed assets, net 54,372 49,547 48,852

Assets in respect of usage right 2,165 738 972

Intangible assets, net 964 4,207 4,149

Inventory of real estate - 134,857 134,807

Investment property under 818,753 310,370 549,401construction

Investment property 8,673,025 7,748,677 7,670,094

Total non-current assets 9,846,449 8,457,315 8,651,088

Total assets 11,271,059 11,117,742 11,299,681

Condensed Consolidated Interim Statement of Financial Position

September September December 31 30 30

2021 2020 2020

(Unaudited) (Unaudited) (Audited)

NIS NIS NIS thousands thousands thousands

Liabilities

Loans and borrowings 610,128 722,557 722,557

Other payables 146,026 158,324 157,431

Current tax liabilities 11,906 10,094 15,977

Liabilities for construction services 109,994 61,655 146,566

Total current liabilities 878,054 952,630 1,042,531

Debentures 4,885,790 5,460,024 5,440,699

Liabilities for construction services 144,004 216,720 127,689

Employee benefits, net 982 754 982

Lease obligation 53,388 155 53,206

Deferred taxes 1,179,327 1,000,987 1,018,589

Total non-current liabilities 6,263,491 6,678,640 6,641,165

Total liabilities 7,141,545 7,631,270 7,683,696

Capital

Share capital 169,585 169,578 169,578

Capital reserves 307,686 304,123 304,868

Retained earnings 2,735,435 2,212,189 2,300,008

Total capital attributed to owners of the 3,212,706 2,685,890 2,774,454Company

Non-controlling interests 916,808 800,582 841,531

Total capital 4,129,514 3,486,472 3,615,985

Total liabilities and capital 11,271,059 11,117,742 11,299,681

Condensed Consolidated Interim Statement of Income

Nine months ended Three months ended Year ended

September 30 September 30 December 31

2021 2020 2021 2020 2020

(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Audited)

NIS thousands NIS thousands NIS thousands

Revenue

Rental income 408,358 401,031 138,908 134,061 533,924



Increase in fair value of investment property

756,277 23,357 183,246 - 109,020

Management fees 7,587 8,575 2,718 3,016 11,793

Other 94,518 28,402 80,148 1,786 32,686

1,266,740 461,365 405,020 138,863 687,423

Expenses

Property maintenance 27,307 23,874 9,882 8,569 32,789

Selling and marketing 7,068 6,356 2,723 2,026 7,929

General and administrative 26,403 25,493 8,345 8,409 33,027

Other 24,452 30,657 8,107 4,844 38,276

85,230 86,380 29,057 23,848 112,021

Operating profit 1,181,510 374,985 375,963 115,015 575,402

Financing expenses, net

Financing income (expenses) 6,298 (16,075) 1,696 634 (13,071)

Financing expenses (180,135) (97,614) (60,588) (41,060) (142,569)

Financing expenses, net (173,837) (113,689) (58,892) (40,426) (155,640)

Share in profits of equity accounted 22,491 7,283 4,029 2,796 14,609investees

Profit before taxes 1,030,164 268,579 321,100 77,385 434,371

Taxes on income 219,540 66,935 68,841 17,123 103,752

Net profit for the period 810,624 201,644 252,259 60,262 330,619

Attributable to:

Owners of the Company 695,427 172,129 235,226 47,356 260,141

Non-controlling interests 115,197 29,515 17,033 12,906 70,478

Net profit for the period 810,624 201,644 252,259 60,262 330,619

Earnings per share attributable to owners ofthe Company

Basic earnings per share (in NIS) 324.98 80.55 109.67 22.16 1.22

Diluted earnings per share (in NIS) 315.37 80.37 106.44 22.11 1.21

Condensed Consolidated Interim Statement of Comprehensive Income

Nine months ended Three months ended Year ended

September 30 September 30 December 31

2021 2020 2021 2020 2020

(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Audited)

NIS thousands NIS thousands NIS thousands

Net profit for the period 810,624 201,644 252,259 60,262 330,619



Items of other comprehensive incomenot to be transferred to profit or loss

Actuarial losses from a defined benefit - - - - (269)plan

Tax benefits for items of other

comprehensive income - - - - 62

Other comprehensive loss

for the period, net of tax - - - - (207)

Total comprehensive income

for the period 810,624 201,644 252,259 60,262 330,412

Attributable to:

Owners of the Company 695,427 172,129 235,226 47,356 259,948

Non-controlling interests 115,197 29,515 17,033 12,906 70,464

Total comprehensive income

for the period 810,624 201,644 252,259 60,262 330,412

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SOURCE Gav-Yam