From Crisis to Growth · Leading Israeli Real Estate Company •~ 13 million sqf in Israel - 97% occupancy •HSBC tower, Manhattan - 865k sqf –100% occupancy •NOI –NIS 650

From Crisis to GrowthIDB - Capital Markets Conference April 2017

2

About IDB

Israeli Leading Investment Vehicle

Israel’s Leading Investment

Corporation

About IDB

• Real assets under management –NIS 38* billion (USD** 10.5 billion)

• Revenues - NIS 18 billion* (USD 5billion)

• Employees over 22,000

3* Excludes Clal Insurance** Convenience translation into US Dollar 18.4.17 USD /ILS – 3.67

Leading conglomerate in the Israeli

market

Diversification

About IDB

Insurance, 27%

Retail, 28%

Real Estate, 22%

Telecommunication, 17%

Others, 6%

4

5

Holding Structure

EOY 2016

9.1% 42.3%

70.9%

64.4% 59.3%50.3%

Development

100%54.9%

45.1% 55.1% 100%

6

Subsidiaries

IDB Group

7

Israeli Largest Cellular Provider

Cellcom

8

Cellcom (42%)

Market Cap NIS 3.6 billion (USD 981 million)

Largest Cellular provider in Israel

Held by DIC

• 2.8 million subscribers, market share ~ 28%

• Holds and operates an independent transmission network

• Fastest growing company in TV and ISP Subscribers

• Revenues ~ NIS 4 billion (USD 1.1 billion)

• EBITDA ~ NIS 858 million (USD 234 million)

• Enterprise Value – NIS 6.1 billion ( USD 1.7 billion)20

37

50

6374

87

99111

122

Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Mar-17

Cellcom TV Subscribers (thousands)

9

Leading Real Estate Company

PBC

9

10

Property & Building (64%)


Leading Israeli Real Estate Company

• ~ 13 million sqf in Israel - 97% occupancy

• HSBC tower, Manhattan - 865k sqf – 100% occupancy

• NOI – NIS 650 million (USD 177 million)

• Net Income – NIS 263 million (USD 72 million) – Increase of

40% vs. 201510

Held by DIC

11

HSBC Tower (100%)

• Trophy asset in Midtown Manhattan , NYC Fifth Avenue

• Acquired in 2009 for USD 353 million

• Book Value – USD 855 million

• HSBC lease renewal up to 2025

• NOI Run Rate - USD 48 million

• Occupancy – 100%Held by PBC

11

12

Gav Yam (55%)


Israeli Leader - High-Tech Parks

12

• Occupancy - 98%

• Top tier tenants

• Income producing assets value - NIS 5.8 billion (USD 1.6

billion)

• Assets under development – 1.8 million sqf

• NOI – NIS 406 million (USD 111 million) – increase of 8% vs.

2015

• Enterprise value – NIS 5.9 billion ( USD 1.6 billion)Held by PBC

12

13

Mehadrin (46%)


• The largest agricultural company in Israel

• Leased agriculture land – 13,600 acers

• Largest citrus exporter

• Total revenues ~ NIS 1.2 billion (USD 330 million)

• EBIT – NIS 38 million (USD 10 million) increase of 50% vs.

2015Held by PBC

13

14

Largest Retailer in Israel

Shufersal

15

Shufersal (59%)

Market Cap NIS 3.8 billion (USD 1 billion)

Israel’s Largest and Leading Retailer

15

• Operates 272 branches, nationwide

• Real Estate portfolio ~ NIS 2.9 billion (USD 789 million)

• Largest food private label - over 20% of sales

• Largest E-Commerce store in Israel – 10% of sales

• Revenues of NIS 12 billion – USD 3.3 billion

• EBITDA - NIS 707 million (USD 192 million) increase of 30%

vs. 2015

• Same Stores Sale - increase of 4.4% in 2016

• Enterprise value- NIS 5.8 billion (USD 1.6 billion)15

Held by DIC

Leading High tech investment company

Elron

1616

16

17

Elron (50%)


• Founded in 1962, Elron is a Leading Israeli investor in early

stage ventures

• Specializing in medical devices and cyber security

• Strategic partnership with Rafael Advanced Defense

Systems LTD.

• Leader of several exits of total amount of more than USD

1.5 billion over the last 5 yearsHeld by DIC

17

18

Second Largest Insurance Company

Clal Insurance

18

19

Clal Insurance (55%)


Equity - NIS 4.7 billion (USD 1.3 billion)

• Second largest insurance company in Israel

• Operates in several Insurance fields: Long term saving; Non –

life insurance; Health insurance

• Assets under management - NIS 177 billion (USD 48 billion)

• Gross Premiums Earned and Contributions in 2016 – NIS 16.6

billion ( USD 3.5 billion)

• Recognized Capital - NIS 7.5 billion (USD 2 billion)2012 2013 2014 2015 2016

484644

4136

Assets Under Management (USD billion)

Held by IDB

20

Liquidity Liquidity Liquidity

21

Liquidity Liquidity Liquidity

2016-2017

21

IDB

• Debt Raising - NIS 1.5 billion (USD 417 million)

• Cash current – NIS 1 billion ( USD 267 million) – enables to

serve the debt up to Nov-19*

• Credit rating upgrade – S&P Maalot

• Removal of going concern note

*with realization of non core assets

DIC

• Sale of Adama – USD 230 million – net cash flow

• Debt Raising - NIS 0.9 billion (USD 249 million)

• Cash current – NIS 1.8 billion ( USD 479 million)

• Credit rating upgrade – S&P Maalot

• Dividend distribution – first time since 2014 - NIS 694 million

(USD 189 million) in 2 phases – Apr- 17 & Sept - 17

22

Thank You

23

Disclaimer• This presentation has been prepared by IDB Development Corporation Ltd. (“IDB").

• The information included in this presentation is not comprehensive and does not purport to include all the relevant information with respect to IDB and its business, nor is it a substitute for inspecting IDB's public reports, including but not limited to the annual report for 2016 and IDB’s immediate reports, as reported to the Israel Securities Authority via the Magna distribution site. The presentation is not an offer nor a solicitation to purchase securities of IDB, and its provisions are not a recommendation or an opinion, nor a substitute for the investor’s discretion and specific examination. IDB does not warrant the completeness or accuracy of the information, and will not be liable for any damage and/or losses which may result from the use of the information.

• In addition, this presentation includes other information that may be presented in a different manner and/or format than the presentation thereof in IDB's Hebrew reports and filings, or that may be extracted from the data included in IDB's Hebrew filings. IDB does not undertake to update this information, in whole or in part.

• The presentation includes general information regarding IDBD and/or companies held by it (together the “IDB Development Group”). The bonds of IDB and the securities of other entities of the IDB Development Group are traded on the Tel Aviv Stock Exchange (“TASE”). Accordingly, IDB and such entities submit their reports (including financial reports and immediate reports) to the TASE, on an on-going basis. This presentation and the information provided herein should be referred to only together with the information provided in the meetings in which it is presented and the relevant companies’ reports to the TASE.

• This Presentation may contain reference to certain intentions, expectations, future plans, strategy and prospects of IDB or its affiliates or its subsidiaries. Those intentions, expectations, future plans, strategy and prospects may or may not be achieved. They are based on certain assumptions, which may not be met or on which views may differ and may be affected by known and unknown risks. The performance and operations of IDB or its affiliates or its subsidiaries may be influenced by a number of factors, many of which are outside the control of IDB or its affiliates or its subsidiaries. No representation or warranty, express or implied, is made by IDB or its affiliates or its subsidiaries, or any of its directors, officers, employees, advisers, consultants or agents that any intentions, expectations or plans will be achieved either totally or partially or that any particular rate of return will be achieved.

24

Annex Financial Data

25

Net Assets Value

Company Share 100% Market Value IDB Share Market Value

Clal Insurance 54.9% 3,113 1,709

DIC 70.9% 2,093 1,500

IDBG (Book Value) 50% 889 445

IDB Tourism (Book Value) 100% 207 207

Others 7

Total Assets 3,868

Net Debt (2,785)*

NAV 1,083

IDB – Net Assets Value (18.04.17)

*Net debt as of 20.3.17 after public adjustments : DIC options exercise, DIC dividend – stage 1 26

Company Share 100% Market Value IDB Share Market Value

Cellcom 42.3% 3,603 1,522

Shufersal 59.3% 3,803 2,255

PBC 64.4% 2,123 1,368

Elron 50.3% 522 263

Epsilon (Book Value)68.8% 73

Others (Book Value)0.0% 178

Total Assets 5,659

Net Debt (2,974)*

NAV 2,685

DIC’s Market cap 2,093

DIC – Net Assets Value (18.04.17)

*Net debt as of 20.3.17 after public adjustments : options exercise, dividend – stage 1 , Shufersal’s shares sale, series 6 expansion,

dividend from subsidiaries etc. 27

Company Share (fully diluted) 100% Market Value IDB Share Market Value

Clal Insurance 54.90% 3,113 1,709

IDBG (book value) 50.00% 889 445

IDBT (book value) 100.00% 207 207

Others IDB 7

Cellcom 30.01% 3,603 1,059

Shufersal 42.06% 3,803 1,568

PBC 45.72% 2,123 951

Elron 35.70% 522 183

Epsilon (book value) 48.77% - 52

Others DIC (book value) - 126

Total Assets 6,307

Net Debt (4,894)*

NAV 1,413

NAV – Clal by Book Value 2,270

*IDB’s net debt + IDB share in DIC’s net debt

IDB – Net Assets Value – Indirect Holding in Subsidiaries (18.04.17)

28

29

Debt Structure

Creditor Face Value Duration Yield to Maturity Market price/ Par Collaterals

Bonds

Series 7 659 0.6 5.12% 100% -

Series 9 1,338 5.1 7.46% 89% -

Series 10 210 1.1 3.33% 104% -

Series 11 86 2.5 2.06% 106% 5% of Clal shares

Series 12 384 2.4 4.26% 107% 31% of DIC shares

Series 13 1,060 2.6 4.34% 103%Future proceeds from

50% of Clal shares

Total Bonds* 3,737 3.0

Banks and others

Banks 1 83 0.2 2.90% - -

Banks 2 27 0.2 2.60% - -

Other 17 0.2 2.25% - -

Total Banks and Other 127

IDB – Debt Structure (NIS million) (as of 18/04/2017)

*Excludes bonds held by IDB 30

Creditor Face Value Duration Yield to Maturity Market price/ Par Collaterals

Bonds

Series 6 4,241 4.2 4.04% 104% -

Series 8 111 1.2 1.33% 104% -

Series 9 222 0.7 0.83% 104% -

Total Bonds* 4,574 3.9

Banks

Banks 1 109 0.9 4.05% - -

Banks 2 65 0.5 4.95% - -

Total Banks 174

DIC – Debt Structure (NIS million) (as of 18/04/2017)

*Excludes bonds held by DIC 31

IDB – Debt Schedule (NIS million)

981*

433

65

231

22

392

22

162

2252

22

1,581

262 252 242 232 222 212

Cash Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2020 2021 2022 2023 2024 2025

201920182017 2020 2021 2022 2023 2024 2025

*Cash as of 20.3.17 after public adjustments : DIC options exercise, DIC dividend – stage 1 32

DIC – Debt Schedule (NIS million)

1,761*

8231

696

266

5616

658

-39

-

620 597 574 551 529 506 483

Cash Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2020 2021 2022 2023 2024 2025

201920182017 2020 2021 2022 2023 2024 2025

*Cash as of 20.3.17 after public adjustments : options exercise, dividend – stage 1 , Shufersal’s shares sale, dividend

from subsidiaries, series 6 expansion, etc.

33

403439

638

554 541577 582

0

100

200

300

400

500

600

700

2010 2011 2012 2013 2014 2015 2016

PBC

732

667629

688

344

542

707

0

100

200

300

400

500

600

700

800

2010 2011 2012 2013 2014 2015 2016

Shufersal

DIC Main Subsidiaries – EBITDA (NIS million)

34

667

2,167

1,753

1,335 1,282

872 858

0

500

1,000

1,500

2,000

2,500

2010 2011 2012 2013 2014 2015 2016

Cellcom

DIC Main Subsidiaries – EBITDA (NIS million)

35

120

394

-

60

- -

100

150

0

50

100

150

200

250

300

350

400

450

2010 2011 2012 2013 2014 2015 2016 2017

PBC

451

344

187

250

70

-

100

160

0

50

100

150

200

250

300

350

400

450

500

2010 2011 2012 2013 2014 2015 2016 2017

Shufersal

DIC Main Subsidiaries – Dividend (NIS million)

36

1,327

827

391

85- - - -

0

200

400

600

800

1,000

1,200

1,400

2010 2011 2012 2013 2014 2015 2016 2017

Cellcom

DIC Main Subsidiaries – Dividend (NIS million)

37

200

150

430

120

- - - -0

50

100

150

200

250

300

350

400

450

500

2010 2011 2012 2013 2014 2015 2016 2017

Clal

1,340

180

- -

234

- -

694

0

200

400

600

800

1,000

1,200

1,400

1,600

2010 2011 2012 2013 2014 2015 2016 2017

DIC

IDB Main Subsidiaries – Dividend (NIS million)

38

39

Annex- Subsidiaries

40

Clal

Legal Issues

• Since 2013, 50% of IDB’s Clal shares are held by a trustee for

regulatory reasons and are subject to sale outline set by the

regulator

• In the recent years IDB has been operating to sell its shares

in Clal.

• Over the years IDB reached several advanced negotiations

processes to sell its stake in Clal with a premium on Clal’s

equity

• In 2016 IDB engaged with JP Morgan in order to attract

potential buyer for controlling share

Epsilon

41

42

Epsilon (68%)

• Investment house and underwriting firm specializes in

various asset management areas.

• Assets under management – NIS 7 billion (USD 1.9 billion)

• Underwriting – 78 public issuance ~ NIS 26 Billion (USD 7.1

Billion) in 2016 and 2017

• Research departmentHeld by DIC

43

Israir

44

Israir (100%)

• Over 1.1 million passengers (650k International)

• 25% growth in passengers travel over the last year

• Over 250k travel packages

• Tourism Specializes - Ski, Young , Elderly , Cruises

• Exploring opportunity to join operational activity with El- Al

Leading Tourism And Aviation Company

Held by IDB

Documents

From Crisis to Growth · Leading Israeli Real Estate Company •~ 13 million sqf in Israel - 97% occupancy •HSBC tower, Manhattan - 865k sqf –100% occupancy •NOI –NIS 650