EMITF Elbit Imaging Ltd (CE)

TEL AVIV, Israel, May 28, 2015 /PRNewswire/ -- Elbit Imaging Ltd. (TASE, NASDAQ: EMITF) ("Elbit" or the "Company") announced today its results for the first quarter of 2015.

Three months ended March 31, 2015 compared to corresponding period in 2014

The Company's loss for the three months period ended March 31, 2015 ("Q1 2015") amounted to NIS 130 million (US$ 33 million), compared to a profit of NIS 1,474 million in the corresponding period in 2014. A significant part of the losses in Q1 2015 is attributed to exchange rate fluctuation (mainly the Euro against the NIS).  The gain in Q1 2014 is attributable to non-cash financial gain resulting from the Company's unsecured debt restructuring in the amount of approximately NIS 1,609 million.

Consolidated revenues and gains for Q1 2015 amounted to NIS 67 million (US$ 17 million) compared to NIS 75 million in the corresponding period in 2014 ("Q1 2014").

• Revenues from hotels operation and management in Q1 2015 amounted to NIS 43 million (US$ 11 million) compared to NIS 44 million in Q1 2014.
• Costs and expenses of hotels operation and management decreased in Q1 2015 to NIS 40 million (US$ 10 million) compared to NIS 42 million in Q1 2014. The decrease resulted from the decrease in the revenue as mentioned above.
• Rental income from commercial centers decreased in Q1 2015 to NIS 25 million (US$ 6 million) compared to NIS 31 million in Q1 2014. The decrease is mainly attributable to the decrease in income from Kragujevac commercial center which was sold in Q3 2014 offset by an increase in income from Plaza's operational commercial centers in Poland and Latvia.
• Cost of commercial centers decreased in Q1 2015 to NIS 18 million (US$ 5 million) compared to NIS 25 million in Q1 2014. The decrease resulted from the decrease in income as mentioned above.
• General and administrative expenses amounted to NIS 4 million (US$ 1 million) in Q1 2015 compared to NIS 10 million in Q1 2014. The decrease in mainly attributable to efficiency measures taken by the Company reducing the general and administrative costs in the Company's headquarters, as well as decrease in the Company's arrangement costs which were included in Q1 2014.       
• Share in losses of associates, net amounted to NIS 14 million (US$ 4 million) in Q1 2015 compared to NIS 6 million in Q1 2014. The losses in Q1 2015 are mainly attributable to losses of InSightec which is an associate of the Company.
• Financial gain from debt restructuring amount to nil in Q1 2015 compared to NIS 1,609 million in Q1 2014. The gain in Q1 2014 is attributed to the consummation of the debt restructuring in February 2014.
• Financial expenses, net increased in Q1 2015 to NIS 124 million (US$ 31 million) compared to financial expenses, net of NIS 109 million in Q1 2014. The increase of NIS 15 million is mainly attributable to the following:
  • An increase in the amount of NIS 76 million (US$ 19 million) in exchange rate losses mainly attributable to fluctuation in the exchange rate between the EURO and NIS (9.5%) with respect to PC's debentures issued in NIS; Offset by:
  • A decrease in the amount of NIS 47 million (US$ 12 million) in non-cash expenses, as a result of changes in fair value of PC's debentures which were measured at fair value through profit and loss in Q1 2014 and are measured at amortized cost in Q1 2015; and
  • A decrease in interest expenses in the amount of NIS 8 million (US$ 2 million) mainly attributable to (i) a decrease in the interest on the Company's debentures of NIS 20 million (US$ 5 million) due to the debt restructuring which was consummated during Q1 2014 offset by (ii) an increase of NIS 12 million (US$ 3 million) in the interest expenses of PC's debentures due to high effective interest rate.
    A decrease in expenses of NIS 6 million (US$ 1.5 million) attributed  to a decrease in the Israeli consumer price index to which  PC's notes are linked to (-1.6% in Q1 2015, compared to -0.68% in Q1 2014).
• Other expenses, net in Q1 2015 amounted to NIS 2 million (US$ 0.5 million) compared to NIS 10 million in Q1 2014. The decrease is mainly due to decrease in initiation expenses.
• Loss before tax expenses amounted to NIS 134 million (US$ 34 million) in Q1 2015 compared to a profit of NIS 1,482 million in Q1 2014.
• Tax expenses amounted to NIS 2 million (US$ 0.5 million) in Q1 2015 compared to of NIS 8 million in Q1 2014.
• Loss from continuing operations amounted to NIS 137 million (US$ 423 million) in Q1 2015 compared to a profit of NIS 1,475 million in Q1 2014.
• Profit from discontinued operations, net, amounted to NIS 7 million (US$ 2 million) in Q1 2015 compared to a loss in the amount of NIS 0.7 million in Q1 2014. The profit in Q1 2015 is mainly attributed to the Company's fashion retail operations which were sold during Q1 2015, and accordingly reclassified as discontinued operations.
• Loss for Q1 2015 amounted to NIS 130 million (US$ 33 million) (out of which NIS 83 million is attributed to the equity holders of the Company) compared to a profit of NIS 1,474 million in the corresponding period in 2014 (out of which NIS 1,500 million is attributed to the equity holders of the Company).
• Shareholders' equity as of March 31, 2015 amounted to NIS 459 million ($ 115 million) (out of which Shareholders' equity in the amount of NIS 113 million ($ 28 million) is attributed to the controlling interest). The decrease in the shareholder's equity results mainly from the loss for the period which is mainly attributed to exchange rate expenses of NIS 80 million as a result of the devaluation of the Euro against the NIS (9.5%). In addition, the fluctuation in the Exchange rate of the Euro and the Romanian Lei against the NIS caused a negative foreign currency translation reserve of NIS 62 million.

About Elbit Imaging Ltd.

Elbit Imaging Ltd. operates in the following principal fields of business: (i) Commercial Centers - Initiation, construction and sale of shopping centers and other mixed-use real property projects, predominantly in the retail sector, located in Central and Eastern Europe, primarily through its subsidiary Plaza Centers N.V. In certain circumstances and depending on market conditions, we operate and manage commercial and entertainment centers prior to their sale; (ii) Hotels - Hotel operation and management; (iii) Medical Industries - (a) research and development, production and marketing of magnetic resonance imaging guided focused ultrasound treatment equipment and (b) development of stem cell population expansion technologies and stem cell therapy products for transplantation and regenerative medicine; (iv) Residential Projects - Initiation, construction and sale of residential units or plots designated for residential, located primarily in India;

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

Any forward-looking statements in our releases include statements regarding the intent, belief or current expectations of Elbit Imaging Ltd. and our management about our business, financial condition, results of operations, and its relationship with its employees and the condition of our properties. Words such as "believe," "would," "expect," "intend," "estimate" and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. Actual results may differ materially from those projected, expressed or implied in the forward-looking statements as a result of various factors including, without limitation, the factors set forth in our filings with the Securities and Exchange Commission including, without limitation, Item 3.D of our annual report on Form 20-F for the fiscal year ended December 31, 2013, under the caption "Risk Factors." Any forward-looking statements contained in our releases speak only as of the date of such release, and we caution existing and prospective investors not to place undue reliance on such statements. Such forward-looking statements do not purport to be predictions of future events or circumstances, and therefore, there can be no assurance that any forward-looking statement contained our releases will prove to be accurate. We undertake no obligation to update or revise any forward-looking statements.

For Further Information:

Company Contact:
Ron Hadassi
Chairman of the Board of Directors
Tel: +972-3-608-6048
ron@elbitimaging.com 

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SOURCE Elbit Imaging Ltd.