Gav-Yam : Releases its Full Year and Fourth Quarter 2020 Results

TEL AVIV, Israel, Feb. 3, 2021 /PRNewswire/ -- Gav-Yam (TASE: BYSD), which is one of Israel's largest real estate companies that specializes in the initiation, planning, construction, and management of hi-tech and offices parks, logistics centers and industrial parks, announced its financial results for 2020.

Financial Highlights

• 8 major Lease agreements cover a total area of ~90,000 m² (the Company's share - 80,000 m²), and annual revenues to the Company of approximately NIS 80 million;
• Consistent growth in all operational parameters;
• 2020 rental income of NIS 534 million, an increase of 4.7%, year-over-year;
• 2020 NOI reached NIS 516 million, an increase of 5.3% year-over-year;
• EBITDA in 2020 of NIS 480 million, an increase of 4.8% year-over-year;
• Operating cash flow in 2020 of NIS 421 million, an increase of 8.5% year-over-year;
• FFO attributed to shareholders of NIS 240 million in 2020, an increase of 3.9% year-over-year;
• 2020 Net Income attributed to shareholders of NIS 260 million, compared with NIS 463 million in 2019. The decrease is mainly due to the decrease in income from increase in the fair value of income-producing properties, compared to last year.

Management Comment

Mr. Avi Jacobovitz, CEO of Gav-Yam, said today: "We concluded a challenging year, in the midst of the Corona Pandemic with all its effects. I believe that the impact is expected to continue for the next year or two. We, like everybody else, felt the crisis but faced it prepared and ready, with a toolbox that enabled us to meet those challenges, continuing with our ongoing activities and fully met all our commitments.

"We operate with a long-term perspective, and we are navigating the crisis and its consequences on our ongoing business. We have shown a continued trend of stability in the level of occupancy and rents, as well as a continuous increase in all operational parameters.

"The highlight of this year's activity was the signing of 8 major lease agreements, mostly with global companies, which include, among others, GM, GE, Microsoft and another global leading technology company.

"In 2020, Gav-Yam signed 160 lease agreements, for approximately 200,000 m², yielding ~NIS 140 million per year, with an average real increase of approximately 4.5% in the rent on existing properties.

"As we stated during the year, global technology companies' need for real estate and recruitment has not been hurt, and demand continues. This is the trend in the market. International companies do not give up on their development centers, and continue to convey that there is no substitute for office work. The current work-from-home trend is not permanent and will not be a substitute for work from the office. The current hybrid model is created through medical constraints and a lack of alternatives, and not via a structured process of changing needs and habits. Even if at the end of the process, which will be gradual, 10% -20% will remain working from home in part or adopt some form of hybrid model, we estimate that the impact to the local commercial market will not be significant. High-tech companies, showing continued growth, are leading the trends in the Israeli market, and are a form of accelerator in the office space market.

"Gav-Yam continues on a very clear path of intensive development activity, which includes 7 projects, amounting to 265,000 m² (the Company's share being about 210,000 m²). The total investment is ~NIS 1.6 billion and expected revenues of ~NIS 125 million, which is an addition of ~NIS 80 million to the FFO attributed to shareholders (an increase of approximately 33% compared to the FFO attributed to shareholders in 2020, which was ~NIS 240 million). After the completion and occupancy of the projects under development, by the end of 2024, the Company's assets will stand at 1.25 million m², with annual revenues of approximately NIS 700 million. This represents a significant leap forward.

"Gav-Yam has 1,034,000 m² of properties, with a broad spread, both geographically in Israel and sectorial, in 18 cities around the country, including 21 parks and high-tech centers, offices, logistics, industry and commerce. The Company's properties are located in leading demand areas in the country, adjacent to railway stations, Class A buildings. In addition, the Company has further reserves of available building rights, amounting to approximately 490,000 m².

"Gav Yam has about 440 customers, most of them large, high-quality and well-established international companies, at the forefront of technology. 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 average lease agreements duration is for about 4.4 years.

"Rent collection was conducted at the typical rate in 2020, similar to that of 2019. During 2020, the Company forgo revenues totaling ~NIS 10 million, which was less than 2% of the Company's annual revenues. All contracts with the Company's customers were honored and there has been no change in this trend.

"The Company has strategic partnerships with the leading academic institutions in Israel. Gav-Yam significantly deepened its activities and collaborations, which include, among others, the Hebrew University in Jerusalem, Ben-Gurion University in the Negev and the Weizmann Institute in Rechovot.

"During the year, the Company completed the construction of 3 projects in a total area of ~45,000 m² (~39,000 m² of which is the Company's portion)

"During 2020, Gav-Yam and its subsidiary Matam issued total debt of approximately NIS 2 billion. The high demand in the three offerings made and their success, is an expression of the capital market's confidence in the Company, in the quality of its assets and in its business strategy, which leads to growth, financial strength and stability over the years, and provides the Company with a boost to its continued development," concluded Mr. Jacobovitz

Investor Relations Contact 
GK Investor Relations
Ehud Helft 
[phone]
[e-mail] 

Company Contact 
Gav-Yam, CFO
Mark Zack
[phone]
[e-mail]

Safe Harbor Statement

The information included in this report is a convenience summary only of the Hebrew report filed with the Tel Aviv Exchange. The Hebrew version of the immediate report is the binding one. This press release may include forecasts, estimates, assessments and other information pertaining to future events and/or matters, whose materialization is uncertain and is beyond the Company's control, and which constitute forward-looking information, as defined in the Securities Law, 5728-1968. Such information may not materialize, in whole or in part, or may materialize in a manner significantly different to that forecast. Such information includes, among others, revenue, FFO and NOI forecasts, the value of the Group's holdings, refinancing, sale of assets, timetables and costs of and profit from projects and the development and construction thereof. 

 

 

Consolidated Balance Sheet as at December 31
			2020	2019
			NIS thousands
Assets
Cash and cash equivalents			1,715,381	889,660
Short-term investments and deposits			823,674	589,031
Trade receivables			4,480	4,669
Other receivables			104,631	52,152
Current tax assets			427	328
Land inventory			-	3,728
Assets held for sale			-	101,082
Total current assets			2,648,593	1,640,650
Other long term receivables			48,371	22,586
Investments and loans in equity accounted investees			194,442	151,855
Fixed assets, net			48,852	48,419
Intangible assets, net			4,149	4,187
Assets in respect of usage right			972	1,635
Available lands inventory			134,807	134,807
Investment property under construction			259,401	258,727
Investment property			7,670,094	7,410,181
Total non-current assets			8,651,088	8,032,397
Total assets			11,299,681	9,673,047

 

 

 

Consolidated Balance Sheet as at December 31
			2020	2019
			NIS thousands
Liabilities
Loans and borrowings			722,557	377,843
Other payables			157,431	229,101
Current tax liabilities			15,977	5,354
Short term liabilities for construction services			146,566	39,264
Total current liabilities			1,042,531	651,562
Debentures			5,440,699	4,291,426
Liabilities for construction services			127,689	160,696
Employee benefits, net			982	754
Liabilities for leases			53,206	615
Deferred taxes			1,018,589	972,006
Total non-current liabilities			6,641,165	5,425,497
Total liabilities			7,683,696	6,077,059
Equity
Share capital			169,578	169,577
Capital reserves			304,868	300,514
Retained earnings			2,300,008	2,240,060
Total equity attributed to owners of the Company			2,774,454	2,710,151
Non-controlling interests			841,531	885,837
Total equity			3,615,985	3,595,988
Total liabilities and equity			11,299,681	9,673,047

 

 

 

Consolidated Statements of profit or loss for the Year Ended December 31
		2020	2019	2018
		NIS thousands	NIS thousands	NIS thousands
		(Other than net earnings per share)
Revenue
Rental income		533,924	510,323	458,985
Increase in fair value of investment property		109,020	358,937	205,745
Management fees		11,793	10,496	10,555
Other		32,686	50,718	8,481
		687,423	930,474	683,766
Expenses
Property maintenance		32,789	34,167	30,953
Selling and marketing		7,929	7,399	11,929
General and administrative		33,027	29,912	25,947
Other		38,276	26,598	5,012
		112,021	98,076	73,841
Operating profit		575,402	832,398	609,925
Financing income		(13,071)	35,851	1,271
Financing expenses		(142,569)	(153,588)	(184,225)
Financing expenses, net		(155,640)	(117,737)	(182,954)
Share in profits of
equity accounted investees		14,609	10,559	10,215
Profit before taxes		434,371	725,220	437,186
Taxes on income		103,752	161,559	94,463
Net profit for the period		330,619	563,661	342,723
Attributable to:
Owners of the Company		260,141	463,383	276,493
Non-controlling interests		70,478	100,278	66,230
Net profit for the period		330,619	563,661	342,723
Earnings per share attributable to owners of the Company
Basic earnings per share (in NIS)		1.22	2.17	1.29
Diluted earnings per share (in NIS)		1.21	2.17	1.29

 

 

Consolidated Statements of Comprehensive Income for the Year Ended December 31
		2020	2019	2018
		NIS thousands	NIS thousands	NIS thousands
Net profit for the period		330,619	563,661	342,723
Items of other comprehensive income that subsequent to initial recognition in comprehensive income were or will be transferred to profit or loss
Tax benefits for items of other comprehensive income		-	-	-
Items of other comprehensive income not to be transferred to profit or loss
Actuarial losses from a defined benefit plan		(269)	(123)	(120)
Tax benefits for items of other comprehensive income		62	28	28
Other comprehensive loss for the period, net of tax		(207)	(95)	(92)
Total comprehensive income for the period		330,412	563,566	342,631
Attributable to:
Owners of the Company		259,948	463,280	276,337
Non-controlling interests		70,464	100,286	66,294
Total comprehensive income for the period		330,412	563,566	342,631

 

 

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SOURCE Gav-Yam