BUENOS AIRES, Argentina, Sept. 9, 2016 /PRNewswire/ -- IRSA Inversiones y Representaciones S.A. (NYSE: IRS; MERVAL: IRSA), the leading real estate company in Argentina, today announces its results for the Fiscal Year 2016 Ended June 30, 2016.
Consolidation of IDB Development Corporation
On October 11, 2015, the Group obtained control of the Israeli company IDB Development Corporation Ltd. ("IDBD"). During the past quarter, the investment was consolidated in the balance sheet, and as from this third quarter of fiscal year 2016, it is also disclosed at income statement level. IDBD's fiscal year-end is on December 31 of each year, whereas the Company's is on June 30. Moreover, in compliance with Israeli regulations, IDBD reports its quarterly and annual results after the expiration of the Argentine statutory terms. For such reasons, the Company will be unable to have available IDBD's quarterly results as and when due in order to report them to the CNV in its financial statements for the period ended March 31, 2016. Thus, the Company will consolidate results from IDBD's operations with a three-month mismatch adjusted for the effects of material transactions occurred during the reported period. In this way, the results of IDBD's operations for the period running from October 11, 2015 (date of acquisition) until December 31, 2015 are included in the interim comprehensive results of the Group for the nine-month period ended on March 31, 2016, except for material transactions considered. The Company estimates a similar mismatch in obtaining IDBD's results in the succeeding periods.
IDBD is one of the largest and most diversified holding companies in Israel. Through its subsidiaries, associates, joint ventures and other investments, IDBD is engaged in numerous markets and industry sectors in Israel and other countries, including real estate (Property & Building Corporation), supermarkets (Shufersal), agroindustry (Adama), insurance (Clal Holdings Insurance Enterprises, hereinafter Clal), and telecommunications (Cellcom), among others. After the closing of this quarter, IDBD's shares were delisted from the Tel Aviv Stock Exchange ("TASE"). However, the company will continue to be registered with the TASE as a "Debentures Company" pursuant to Israeli law, as it has bonds listed in such exchange.
Significant assets have been added in various industries in which the Group did not have investments until to date, as well as liabilities for loans taken by IDBD and its subsidiaries.
We have decided to break down reporting into an Argentine Operating Center and an Israeli Operating Center. From the Argentine Operating Center, the Group, through IRSA and its subsidiaries, manages the businesses in Argentina and the international investments in the Lipstick Building in New York and the Condor Hospitality Trust hotel REIT. From the Israeli Operating Center, the Group manages IDBD.
- During fiscal year 2016, we started to consolidate the results of our investment in IDB Development Corporation.
- EBITDA for fiscal year 2016 was ARS 6,178 million (ARS 2,974 million from Argentina and ARS 3,204 million from Israel) and we recorded a net loss of ARS 1,872 million, mainly explained by non-cash items such as exchange rate differences and the fair market valuation of Clal, owned by IDBD.
- Sales in our shopping centers grew 34% in fiscal year 2016 (30% in the same shopping centers) and EBITDA from this segment rose 36%, reaching ARS 1,810 million.
- During fiscal year 2016 we sold investment properties, at a gain of ARS 1,113 million.
- In connection with our investment in IDBD, during this year we satisfied all our agreed commitments, and IDBD used such funds to reduce its debt from NIS 4,814 million to NIS 2,785 million.
- After year-end, IRSA issued a bond in the local market for USD 184.5 million, accruing interest at 7%, and for ARS 384.2 million, accruing interest at Badlar + 299 bps, due in 2019, and used its proceeds to repay almost all its short term debt.
(In millions of Argentine Pesos)
Fiscal Year 2016
Ended June 30, 2016
Consolidated Gross Profit
Consolidated Profit from Operations
Profit / (Loss) For the Period
Non Current Assets
Non Current Liabilities
IRSA Inversiones y Representaciones S.A. (NYSE: IRS, BASE: IRSA) is Argentina's largest, most well-diversified real estate company, and it is the only company in the industry whose shares are listed on both the Bolsa de Comercio de Buenos Aires and The New York Stock Exchange. Through its subsidiaries, IRSA manages, through its subsidiary IRSA Commercial Properties S,A, an expanding top portfolio of shopping centers and office buildings, primarily in Buenos Aires. The company also develops residential subdivisions and apartments (specializing in high-rises and loft-style conversions) and owns three luxury hotels. Its solid, diversified portfolio of properties has established the Company as the leader in the sector in which it participates, making it the best vehicle to access the Argentine real estate market. Additionally, IRSA owns a stake in Banco Hipotecario, Argentina's largest mortgage supplier in the country, 49% voting power of the US Reit Condor Hospitality Trust and a 68.3% stake in IDB Development Corporation.
A longer version of this press release with detailed information is available on the web site: http://www.irsa.com.ar
IRSA cordially invites you to participate in its Fiscal Year 2016 Results Conference Call on Friday, September 09, 2016, at 2:00pm Eastern Time
If you would like to participate, please call:
United States: (877) 317-6776
International: +1-(412) 317-6776
To access the webcast, click on the link below:
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SOURCE IRSA Inversiones y Representaciones S.A.