REG - Plaza Centers N.V. - RESULTS FOR THE YEAR ENDED 31 DECEMBER 2025
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RNS Number : 9100Y Plaza Centers N.V. 31 March 2026
31 March, 2026
PLAZA CENTERS N.V.
RESULTS FOR THE YEAR ENDED 31 DECEMBER 2025
Plaza Centers N.V. ("Plaza", the "Company" or the "Group") today announces its
results for the year ended 31 December 2025.
Financial highlights:
· Consolidated cash position as at 31 December 2025 decreased by
approximately €0.75 million to €1.85 million (31 December 2024: €2.6
million), primarily due to general and legal expenses.
· Operating loss amounted to €0.6 million (31 December 2024:
€3.4 million loss), reflecting lower general and legal expenses as well as
additional income of €0.4 million, which offset the expenses.
· Net loss of €18.0 million was recorded (31 December 2024:
€28.1 million loss), mainly due to finance results on bonds, general and
legal expenses.
· Basic and diluted loss per share amounted to €2.63 (31 December
2024: €4.10 loss per share).
Material events during the period:
Tax authority investigation:
On January 20, 2025 the Company announced that further to its announcement
dated March 25, 2024 with regards to the search and seizure operations carried
by the Indian tax authorities at the offices of Elbit Plaza India Management
Services Private Limited (hereinafter: "EPIM") (which is a private company
wholly owned by Elbit Plaza India Real Estate Holdings Limited), EPIM has
received a tax assessment order (from the Indian Tax Authority) for the
financial years 2022 - 2023 and with this the ongoing income tax
investigations/assessments are completed without imposing any liability on
EPIM.
Update regarding update regarding a lawsuit against entities involved in the
sale of U.S.A. shopping centers in 2011:
On May 22, 2025 the Company announced that, further to its announcement dated
June 19, 2023 regarding the filing of a claim by Plaza and Elbit Imaging Ltd.
(hereinafter: "Elbit") (Plaza and Elbit shall be referred to hereinafter
together as the: "Plaintiffs") against certain parties (a number of officers
in Plaza and Elbit, some of the heirs of the late Moti Zisser (former
controlling shareholder of Plaza and Elbit) and other parties) in relation to
the Plaintiffs' transaction from 2011 for the sale of real estate assets in
the US in 2011; that a mediation agreement has been reached to end the entire
proceeding, according to which the Plaintiffs will be compensated in return
for a final and full waiver of claims. Plaza's share of the settlement amount
is approximately €0.3 million. On June 29, 2025 the Company received the
settlement amount.
Update regarding submission of a request for arbitration against Romania with
respect to the "Casa Radio" project:
On October 28, 2025 the Company announced that, the Ministry of Finance of
Romania filed its Statement of Claim in the London Court of International
Arbitration ("LCIA"), requesting termination of the Public-Private Partnership
("PPP") Agreement and return of project assets, with claimed losses increased
to approximately EUR 2 billion (from c. EUR 96 million previously claimed).
Plaza rejected the claims, attributing the project's failure to Romania's
actions, and confirmed it will continue its defense and pursue counterclaims.
On November 19, 2025, the Company announced that, the Ministry of Finance of
Romania submitted a revised Statement of Claim, presenting certain alleged
losses as alternative rather than cumulative claims; at this stage, Plaza
indicated it cannot reliably assess the potential financial impact of the
arbitration.
On March 29, 2024 the Company announced that, it has received a further
engagement letter ("Further Engagement Letter"), from the Company's primary
legal advisers in connection with the arbitration for the "Casa Radio" project
(the "Project"). The Further Engagement Letter is in line with Company's
projected cash flow that was approved at Bondholders' Meeting from October 11,
2023.
The LCIA arbitration remains connected to the International Centre for the
Settlement of Investment Disputes proceedings initiated by Plaza against
Romania, for which a final award is expecting in April, 2026.
In addition, on November 20, 2025, Plaza and AFI Europe N.V. agreed to extend
the long-stop date for the potential sale of Plaza's indirect 75% stake in the
Casa Radio project to December 31, 2026, with no certainty that the
transaction will be completed.
Deferral of payment of Debentures and partial interests' payment:
Refer to the below in Liquidity & Financing.
Dutch statutory auditor:
Refer to Note 15(b)(6) in the annual consolidated financial statements.
Key highlights since the period end:
Annual General Meeting:
Annual general meeting of the Shareholders of the Company was held on January
13, 2026, all the proposed resolutions were rejected.
Appointment of Company's auditor:
On January 15, 2026 the Company announced that further to its previous
announcement dated January 13, 2026 regarding results of Annual General
Meeting, the Board of Directors of the Company decided to reappoint KOST FORER
GABBAY & KASIERER (a member of the global network of EY firms) as the
audit company authorised to audit the consolidated financial statements of the
Company for the year ended December 31, 2025 in order to ensure the reporting
requirements and enable the Company's proper operations.
Commenting on the results, executive director Ron Hadassi said:
"The Company continues to actively pursue all necessary actions in relation to
the Casa Radio Project. The Company has initiated arbitration proceedings
against Romania before the International Centre for Settlement of Investment
Disputes ("ICSID") seeking compensation for losses incurred as a result of the
Romanian authorities' failure to comply with their contractual obligations.
The hearing on jurisdiction and merits took place in November 2024, and the
Company is currently awaiting the Tribunal's ruling.
In parallel, the Company is defending its position in LCIA proceedings
initiated by Romania in relation to the Casa Radio Project and continues to
reject all claims while pursuing its counterclaims"
For further details, please contact:
Plaza
Ron Hadassi, Executive
Director
972-526-076-236
Notes to Editors
Plaza Centers N.V. (www.plazacenters.com) is listed on the Main Board of the
London Stock Exchange, on the Warsaw Stock Exchange (LSE: "PLAZ", WSE:
"PLZ/PLAZACNTR") and, on the Tel Aviv Stock Exchange.
Forward-looking statements
This press release may contain forward-looking statements with respect to
Plaza Centers N.V. future (financial) performance and position. Such
statements are based on current expectations, estimates and projections of
Plaza Centers N.V. and information currently available to the Company. Plaza
Centers N.V. cautions readers that such statements involve certain risks and
uncertainties that are difficult to predict and therefore it should be
understood that many factors can cause actual performance and position to
differ materially from these statements.
MANAGEMENT STATEMENT
During 2025, the Company continued its cost reduction measures while
maintaining its ongoing engagement with bondholders.
In connection with the Casa Radio Project, as noted above, the Company has
submitted a Request for Arbitration with the International Centre for
Settlement of Investment Disputes, and expects that this process may assist in
resolving the current impasse affecting the Project.
In addition, on November 20, 2025, the Company and AFI Europe N.V. agreed to
extend the Long Stop Date, being the date by which the parties intend to
execute a share purchase agreement subject to the satisfaction of conditions
precedent, until December 31, 2026.
Due to the board and management estimation the Company is unable to serve its
entire debt according to the current redemption date (July 1, 2026) in its
current liquidity position, the Company intends to request from the
bondholders of both series (Series A and Series B) postponement of the
repayment of the remaining balance of the bonds.
Results
During the year, Plaza recorded a loss of €18.0 million attributable to the
shareholders of the Company, compared to a loss of €28.1 million in 2024.
The loss was mainly driven by foreign exchange losses on bonds (including
inflation effects), interest expenses accrued on the debentures (partly due to
penalty interest on deferred principal), translation differences arising from
the realization of foreign operations, as well as administrative and legal
expenses.
Total result of operations excluding finance income and finance cost was a
loss of €0.6 million in 2025 compared to the reported loss of €3.4 million
in 2024. The decrease was caused mainly by lower general and legal expenses as
well as additional income of €0.4 million, which offset the expenses.
The consolidated cash position (including cash held by the Company on a
standalone basis and its wholly owned subsidiaries) as of December 31, 2025
was €1.9 million (December 31, 2024: €2.6 million).
Liquidity & Financing
Plaza ended the period with a consolidated cash position of circa €1.85
million, compared to €2.6 million at the end of 2024.
As of December 31, 2025, the Group's outstanding obligation to bondholders
(including accrued interests) are app. €176.7 million.
As disclosed by the Company in Note 8 in the annual consolidated financial
statements, the Company was not able to meet its final redemption obligation
to its (Series A and Series B) bondholders, due on July 1, 2025. During June
2025 the bondholders of Series A and Series B approved to postpone the final
redemption date to January 1, 2026. During November 2025, the bondholders of
Series A and Series B approved to postpone the final redemption date to July
1, 2026.
Due to the board and management estimation that the Company is unable to serve
its entire debt according to the current bonds repayment schedule in its
current liquidity position, the Company intends to request the bondholders of
both series for postponement of the repayment of the remaining balance of the
bonds. However, there is an uncertainty if the bondholders will approve the
request. In the case that the bondholders would declare their remaining claims
to become immediately due and payable, the Company would not be in a position
to settle those claims and would need to enter to an additional debt
restructuring or might cease to be a going concern.
Strategy and Outlook
The Company's priorities are focused on efforts to unblock the current status
of the Casa Radio project. The Company also intends to seek for bondholders'
approval for postponement of the repayment of the bonds.
OPERATIONAL REVIEW
The Company's current assets are summarised in the table below (as of balance
sheet date):
Asset/ Project Location Nature of asset Plaza's effective ownership Status
%
Casa Radio Bucharest, Romania Mixed-use retail, hotel and leisure plus office scheme 75 for further information refer to note 5 (2) in the annual consolidated
financial statements )
FINANCIAL REVIEW
Results
In 2025, administrative expenses amounted to €0.9 million, compared to
€3.3 million in 2024. The decrease was mainly due to higher legal expenses
incurred in 2024 in connection with the arbitration proceedings initiated by
the Company in Romania, as described above in relation to the Casa Radio
Project.
Net finance costs changed from €24.7 million loss in 2024 to €17.4
million loss in 2025. The main components of net finance costs were foreign
currency gain on bonds (including inflation), interests' expenses accrued on
the debentures which includes also penalty interest calculated on the deferred
principal.
As a result, the loss for the period amounted to circa €18 million in 2025,
representing a basic and diluted loss per share for the period of €2.62
(2024: €28.1 loss).
Balance sheet and cash flow
Total assets as of December 31, 2025 amounted to €1.85 million (December 31,
2024: €2.6 million), primarily comprising cash balances, and decreased due
to general expenses and legal costs.
As of 31 December 2025, Plaza has a balance sheet liability of app. €101.9
million from issuing bonds on the Tel Aviv Stock Exchange. Additionally, Plaza
recorded provision for interests on bonds as of December 31, 2025, in amount
of €74.8 million (31 December 2024: €55.1 million).
Disclosure in accordance with Regulation 10(B)14 of the Israeli Securities
Regulations (periodic and immediate reports), 5730-1970
1. General Background
According to the abovementioned regulation, upon existence of warning signs as
defined in the regulation, the Company is obliged to attach its report's
projected cash flow for a period of two years, commencing with the date of
approval of the report ("Projected Cash Flow").
The material uncertainty related to going concern was included in the
independent auditors' report and in Note 1(b) in the consolidated financial
statements as of December 31, 2025. In light of the material uncertainty that
the SPA between the Company and AFI Europe N.V. will eventually be executed
and/or that the transaction will be consummated as presented above or at all
(refer to Note 5 in the consolidated financial statements as of December 31,
2025), the board and management estimates that the Company is unable to serve
its entire debt according to the due date the bond holders approved to
postpone the final redemption date. Accordingly, it is expected that the
Company will not be able to meet its entire contractual obligations in the
following 12 months.
With such warning signs, the Company is providing projected cash flow for the
period of 24 months following for the coming two years.
2. Projected cash flow
The Company has implemented the restructuring plan that was approved by the
Dutch Court on July 9, 2014 (the "Restructuring Plan"). Under the
Restructuring Plan, principal payments under the bonds issued by the Company
and originally due in the years 2013 to 2015 were deferred for a period of
four and a half years, and principal payments originally due in 2016 and 2017
were deferred for a period of one year. During first three months 2017, the
Company paid to its bondholders a total amount of NIS 191.7 million (EUR 49.2
million) as an early redemption. Upon such payments, the Company complied with
the Early Prepayment Term (early redemption at the total sum of at least NIS
382 million) and thus obtained a deferral of one year for the remaining
contractual obligations of the bonds.
In January 2018, a settlement agreement was signed by and among the Company
and the two Israeli Series of Bonds.
On November 22, 2018 the Company announced based on its current forecasts,
that the Company expected to pay the accrued interest on Series A and Series B
Bonds on December 31, 2018, in accordance with the repayment schedule
determined in the Company's Restructuring Plan and Settlement Agreement with
Series A and Series B Bondholders from 11 January 2018 (the "Settlement
Agreement"). The Company noted that it will not meet its principal repayment
due on December 31, 2018 as provided for in the Settlement Agreement. On
February 18, 2019 the Company paid principal of circa EUR 250,000 and Penalty
interest on arrears of EUR 150,000 following the bondholder's approval to
defer principal repayment to July 1, 2019.
In addition, during June 2019 the bondholders approved the deferral of the
full payment of principal due on July 1, 2019 and of 58% ("deferred interest
amount") of the sum of interest (consisting of the total interest accrued for
the outstanding balance of the principal, including interest for part of the
principal payment which was deferred as of February 18, 2019, plus interest
arrears for part of the principal which was fixed on February 18, 2019 and was
not paid by the Company and all in accordance with the provisions of the trust
deed; "the full amount of interest"), the effective date of which is June 19,
2019, and the payment date was fixed as of July 1, 2019. The company paid on
the said date a total amount of circa EUR 1.17 million, which is only 42% of
the full amount of interest.
On July 11, 2019, the Company announced that its Romanian subsidiary had
signed a binding agreement to sell a land in Romania, and that the Company
would use part of the proceeds now received by it EUR 0.75 million
(hereinafter: "the amount payable"), in order to make a partial interest
payment to the bondholders (Series A) and (Series B) issued by the Company.
The payment required changes in the repayment schedule and amendments of the
trust deeds which was approved unanimously by the Bondholders. The amount
payable was paid on August 14, 2019 and reflects 30% of accrued interest as of
that date.
On November 17, 2019, the bondholders of Series A and Series B approved a
deferral of all the scheduled Principal payment and app. 87% of deferral of
the scheduled Interest payment, both, as of December 31, 2019 to July 1, 2020.
On May 4, 2020, the bondholders of Series A and Series B approved: (i) to
postpone the final redemption date to January 1, 2021 of all the scheduled
Principal; (ii) that on July 1, 2020 the Company will pay to its bondholders a
partial interest payment in the total amount of EUR 250,000 and to deferral
all other unpaid scheduled Interest payment.
Following receiving the Settlement Amount related to the final price
adjustment of the sale of Belgrade Plaza and in light of the potential
negative impact of the Covid-19 on the possibility to receive future proceeds
from the Company's plots in India, the Company decided to increase the amount
to be paid to the bondholders on July 1, 2020, from EUR 250,000 to EUR
500,000. The amount reflected 6.74% of accrued interest as of that date.
On November 12, 2020, the bondholders of Series A and Series B approved: (i)
to postpone the final redemption date to July 1, 2021 of all the scheduled
Principal; that on January 1, 2021 the Company will pay to its bondholders a
partial interest payment in the total amount of EUR 200,000 and to deferral
all other unpaid scheduled Interest payment. The amount reflected 1.84% of
accrued interest as of that date.
On April 12, 2021, the bondholders of Series A and Series B approved: (i) to
postpone the final redemption date to January 1, 2022; (ii) that on July 1,
2021 the Company will pay to its bondholders a partial interest payment in the
total amount of EUR 125,000 and to deferral all other unpaid interest. The
amount reflected 0.84% of accrued interest as of that date.
On November 25, 2021, the bondholders of Series A and Series B approved: (i)
to postpone the final redemption date to July 1, 2022; (ii) that on January 1,
2022 the Company will pay to its bondholders a partial interest payment in the
total amount of EUR 200,000 and to deferral all other unpaid interest. The
amount reflected 0.92% of accrued interest as of that date.
On June 16, 2022, the bondholders of Series A and Series B approved to
postpone the final redemption date to January 1, 2023.
On November 8, 2022, the bondholders of Series A and Series B approved: (i) to
postpone the final redemption date to July 1, 2023; (ii) that on January 1,
2023 the Company will pay to its bondholders a partial interest payment in the
total amount of EUR 2,000,000 and to deferral all other unpaid interest. The
amount reflected 6.08% of accrued interest as of that date.
During June 2023 the bondholders of Series A and Series B approved: (i) to
postpone the final redemption date to January 1, 2024; ; (ii) that on July 1,
2023 the Company will pay to its bondholders a partial interest payment in the
total amount of EUR 750,000 and to deferral all other unpaid interest.
During November 2023, the bondholders of Series A and Series B approved: (i)
to postpone the final redemption date to July 1, 2024; (ii) that on January 1,
2023 the Company will pay to its bondholders a partial interest payment in the
total amount of EUR 200,000 and to deferral all other unpaid interest.
During June 2024 the bondholders of Series A and Series B approved to postpone
the final redemption date to January 1, 2025. During November 2024, the
bondholders of Series A and Series B approved to postpone the final redemption
date to July 1, 2025.
Accordingly, during June 2025 the bondholders of Series A and Series B
approved to postpone the final redemption date to January 1, 2026. During
November 2025, the bondholders of Series A and Series B approved to postpone
the final redemption date to July 1, 2026.
The materialization, occurrence consummation and execution of the events and
transactions and of the assumptions on which the projected cash flow is based,
including with respect to the proceeds and timing thereof, although probable,
are not certain and are subject to factors beyond the Company's control as
well as to the consents and approvals of third parties and certain risks
factors. Therefore, delays in the realization of the Company's assets and
investments or realization at a lower price than expected by the Company, as
well as any other deviation from the Company's Assumptions (such as additional
expenses due to suspension of trading, delay in submitting the statutory
reports etc.), could have an adverse effect on the Company's cash flow and the
Company's ability to service its indebtedness in a timely manner.
In € millions 2026 2027
Cash - Opening Balance ((2)) 1.85 0.8
Proceeds from other income ((3)) - -
Total Sources 1.85 0.8
Debentures - principal - -
Debentures - interest ((4)) - -
Other operational costs ((5)) 0.25
-
G&A expenses (including property maintenance) ((5)) 0.8 0.8
Total Uses 1.05 -
Cash - Closing Balance ((2)) 0.8 -
(1) The above cash flow is subject to the approval of the bondholders of
both series to postponement of the repayment of the remaining balance of the
bonds which are due on July 1, 2026.
(2) Total cash on standalone basis as well as fully owned subsidiaries.
(3) The Company did not include any proceeds from pre-sale agreement
signed with AFI, due to the uncertainty as to the fulfilment of the conditions
set out in the preliminary agreement as mentioned in Note 5(1) of the
consolidated financial statements as of December 31, 2025, thus there can be
no certainty an the SPA will eventually be executed and/or that the
Transaction will be completed.
(4) Payments of interests are subject to the approval of the bondholders
of both series.
(5) The cost includes a provision for arbitrations / legal costs based on
projection of arbitration process.
(6) Total general and administrative expenses includes both cost of the
Company and of all the subsidiaries.
Ron Hadassi
Executive Director
31 March 2026
PLAZA CENTERS N.V.
CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2025
IN 000 EUR
CONTENTS
Page
Independent Auditors' report 2 - 5
Consolidated statement of financial position 6
Consolidated statement of profit or loss 7
Consolidated statement of comprehensive income 8
Consolidated statement of changes in equity 9
Consolidated statement of cash flows 10
Notes to the consolidated financial statements 11 - 45
- - - - - - - - - - - - - - - - - - - - - -
Kost Forer Gabbay & Kasierer Tel: +972-3-6232525
144 Menachem Begin Road Fax: +972-3-5622555
Tel-Aviv 6492102, Israel ey.com
Report on the Audit
of the Consolidated Financial Statements
Independent Auditors' Report
To the shareholders of Plaza Centers N.V.
Opinion
We have audited the consolidated financial statements of Plaza Centers N.V.
and its subsidiaries ("the Company"), which comprise the consolidated
statement of financial position as at December 31, 2025 and the consolidated
statements of profit or loss, comprehensive income, changes in equity and cash
flows for the year then ended, and notes to the consolidated financial
statements, including material accounting policy information.
In our opinion, the accompanying consolidated financial statements present
fairly, in all material respects, the consolidated financial position of the
Company as at December 31, 2025, and its consolidated financial performance
and its consolidated cash flows for the year then ended in accordance with
IFRS Accounting Standards as adopted by the European Union.
As mentioned in note 2(a) in the consolidated financial statements, these
consolidated financial statements, with our report included, are not intended
for Netherlands statutory filing purposes.
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing.
Our responsibilities under those standards are further described in the
Auditors' Responsibilities for the Audit of the Consolidated Financial
Statements section of our report. We are independent of the Company in
accordance with the International Ethics Standards Board for Accountants'
International Code of Ethics for Professional Accountants (including
International Independence Standards) ("IESBA Code"), as applicable to audits
of financial statements of public interest entities, and we have fulfilled our
other ethical responsibilities in accordance with the IESBA Code. We believe
that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Material Uncertainty Related to Going Concern
We draw your attention to Note 1(b) in the consolidated financial statements
which discloses the Company's financial position and board and management's
future plans to meet its financial liabilities.
The board and management estimate that the Company is unable to serve its
entire debt to bondholders according to the current repayment schedule in
total amount of EURO 176.7 million as of December 31, 2025 which is due on
July 1, 2026). The Company is dependent on the bondholders' approval for any
postponement of payments. In addition, the Company is not in compliance with
the main Covenants as defined in the restructuring plan (for more details
refer also to Note 7), hence in default which could trigger early repayment by
the bondholders.
The abovementioned conditions indicate that a material uncertainty exists that
casts significant doubt about the Company's ability to continue as a going
concern. Our opinion is not modified in respect of this matter.
Kost Forer Gabbay & Kasierer Tel: +972-3-6232525
144 Menachem Begin Road Fax: +972-3-5622555
Tel-Aviv 6492102, Israel ey.com
Emphasis of Matter
We draw your attention to Note 5(1)(c) which discloses the risk that the
public authorities may seek to terminate the Public Private Partnership
Agreement ("PPP Agreement") and/or relevant permits and/or could seek to
impose delay penalties on the basis of perceived breaches of the Company's
commitments under the PPP Agreement.
Our opinion is not modified in respect of this matter.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were
of most significance in our audit of the consolidated financial statements for
the year ended December 31, 2025. Except for the matter described in the
Material Uncertainty Related to Going Concern section, we have determined that
there are no other matters to communicate in our report.
Other information included in The Company's 2025 Annual Report
Other information consists of the information included in the Annual Report,
other than the financial statements and our auditor's report thereon.
Management is responsible for the other information.
Our opinion on the financial statements does not cover the other information
and we do not express any form of assurance conclusion thereon. In connection
with our audit of the financial statements, our responsibility is to read the
other information and, in doing so, consider whether the other information is
materially inconsistent with the financial statements or our knowledge
obtained in the audit or otherwise appears to be materially misstated. If,
based on the work we have performed, we conclude that there is a material
misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Responsibilities of Management and the Board of Directors for the Consolidated
Financial Statements
Management is responsible for the preparation and fair presentation of the
consolidated financial statements in accordance with IFRS Accounting
Standards, as adopted by the European Union, and for such internal control as
management determines is necessary to enable the preparation of consolidated
financial statements that are free from material misstatement, whether due to
fraud or error.
In preparing the consolidated financial statements, management is responsible
for assessing the Company's ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless management either intends to
liquidate the Company or to cease operations, or has no realistic alternative
but to do so.
The board of directors is responsible for overseeing the Company's financial
reporting process.
Kost Forer Gabbay & Kasierer Tel: +972-3-6232525
144 Menachem Begin Road Fax: +972-3-5622555
Tel-Aviv 6492102, Israel ey.com
Auditors' Responsibilities for the Audit of the Consolidated Financial
Statements
Our objectives are to obtain reasonable assurance about whether the
consolidated financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditors' report
that includes our opinion. Reasonable assurance is a high level of assurance
but is not a guarantee that an audit conducted in accordance with
International Standards on Auditing will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are considered
material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of
these consolidated financial statements.
As part of an audit in accordance with International Standards on Auditing, we
exercise professional judgment and maintain professional scepticism throughout
the audit. We also:
• Identify and assess the risks of material misstatement of
the consolidated financial statements, whether due to fraud or error, design
and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our
opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve
collusion, forgery, intentional omissions, misrepresentations, or the override
of internal control.
• Obtain an understanding of internal control relevant to
the audit in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Company's internal control.
• Evaluate the appropriateness of accounting policies used
and the reasonableness of accounting estimates and related disclosures made by
management.
• Conclude on the appropriateness of management's use of the
going concern basis of accounting and, based on the audit evidence obtained,
whether a material uncertainty exists related to events or conditions that may
cast significant doubt on the Company's ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required to
draw attention in our auditors' report to the related disclosures in the
consolidated financial statements or, if such disclosures are inadequate, to
modify our opinion. Our conclusions are based on the audit evidence obtained
up to the date of our auditors' report. However, future events or conditions
may cause the Company to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content
of the consolidated financial statements, including the disclosures, and
whether the consolidated financial statements represent the underlying
transactions and events in a manner that achieves fair presentation.
• Plan and perform the group audit to obtain sufficient
appropriate audit evidence regarding the financial information of the entities
or business units within the group as a basis for forming an opinion on the
consolidated financial statements. We are responsible for the direction,
supervision and review of the audit work performed for the purposes of the
group audit. We remain solely responsible for our audit opinion.
We communicate with the board of directors regarding, among other matters, the
planned scope and timing of the audit and significant audit findings,
including any significant deficiencies in internal control that we identify
during our audit.
Kost Forer Gabbay & Kasierer Tel: +972-3-6232525
144 Menachem Begin Road Fax: +972-3-5622555
Tel-Aviv 6492102, Israel ey.com
We also provide the board of directors with a statement that we have complied
with relevant ethical requirements regarding independence and to communicate
with them all relationships and other matters that may reasonably be thought
to bear on our independence, and where applicable, actions taken to eliminate
threats or safeguards applied.
From the matters communicated with the board of directors, we determine those
matters that were of most significance in the audit of the consolidated
financial statements for the year ended December 31, 2025 and are therefore
the key audit matters. We describe these matters in our auditors' report
unless law or regulation precludes public disclosure about the matter or when,
in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such
communication.
The partner in charge of the audit resulting in this independent auditor's
report is Mr. Yeshayahu Silberstrom.
Tel-Aviv, Israel KOST FORER GABBAY & KASIERER
March 31, 2026 A Member of Ernst & Young Global
CONSOLIDATED STATEMENT OF FINANCIAL POSITION IN '000 EUR
December 31,
Note 2025 2024
ASSETS
Cash and cash equivalents 3 1,847 2,588
Restricted bank deposits - 14
Prepayments and other receivables 39 28
Total current assets 1,886 2,630
Total assets 1,886 2,630
LIABILITIES AND SHAREHOLDERS' EQUITY
Bonds at amortized cost 7 101,890 104,040
Accrued interests on bonds 7 74,778 55,131
Trade payables 72 39
Other liabilities 6 271 548
Total current liabilities 177,011 159,758
Share capital 9 6,856 6,856
Other reserves (19,983) (19,983)
Share based payment reserve 9 35,376 35,376
Share premium 9 282,596 282,596
Accumulated deficit (479,970) (461,973)
Total equity (175,125) (157,128)
Total equity and liabilities 1,886 2,630
The notes are an integral part of the consolidated financial statements.
March 31, 2026
Ron Hadassi David Dekel
Date of approval of the Executive Officer Chairman of the Board of Directors
financial statements
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
IN '000 EUR
Year ended
December 31,
Note 2025 2024
Other income 4 445 58
Expenses and losses
Cost of operations (129) (123)
Administrative expenses 12 (896) (3,308)
Total Expenses and losses (1,025) (3,431)
Finance income 13 92 121
Finance costs 13 (17,509) (24,881)
Finance income (costs), expenses and losses (18,442) (28,191)
Loss before income tax (17,997) (28,133)
8 - -
Income
tax
Loss for the year (17,997) (28,133)
Earnings per share
Basic and diluted loss per share (EUR) 10 (2.63) (4.10)
The notes are an integral part of the consolidated financial statements.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
IN '000 EUR
Year ended
December 31,
2025 2024
Loss for the year (17,997) (28,133)
Other comprehensive profit for the year, net of income tax - -
Total comprehensive loss for the year (17,997) (28,133)
The notes are an integral part of the consolidated financial statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
IN '000 EUR
Share Share Premium Share based payment reserves Capital reserve from acquisition of non-controlling interests Accumulated deficit Total
capital
Balance on January 1, 2024 6,856 282,596 35,376 (19,983) (433,840) (128,995)
Net loss for the year - - - - (28,133) (28,133)
Total comprehensive loss for the year - - - - (28,133) (28,133)
Balance on December 31, 2024 6,856 282,596 35,376 (19,983) (461,973) (157,128)
Net loss for the year - - - - - (17,997) (17,997)
Total comprehensive loss for the year - - - - (17,997) (17,997)
Balance on December 31, 2025 6,856 282,596 35,376 (19,983) (479,970) (175,125)
The notes are an integral part of the consolidated financial statements.
CONSOLIDATED STATEMENT OF CASH FLOWS IN '000 EUR
Year ended
December 31,
2025 2024
Cash flows from operating activities
Loss for the year (17,997) (28,133)
Adjustments necessary to reflect cash flows used in operating activities
Net finance costs 17,417 24,760
Cash flow from operations before changes in working capital (580) (3,373)
Changes in:
Trade receivables (9) (3)
Other receivables (2) 68
Trade payables 33 (2)
Other liabilities, related parties' liabilities and provisions (277) 76
Cash flow from changes in working capital (255) 139
Interest paid - -
Interest received 38 121
Net cash used in operating activities (797) (3,113)
Cash from investing activities
Investment in (receipt of) restricted deposit 14 10
Net cash provided by investing activities 14 10
Net cash used in financing activities - -
Increase (decrease) in cash and cash equivalents during the year (783) (3,103)
Effect of movement in exchange rate fluctuations on cash held 42 (14)
Cash and cash equivalents at beginning of period 2,588 5,705
Cash and cash equivalents at end of period 1,847 2,588
The notes are an integral part of the consolidated financial statements.
NOTE 1: - CORPORATE INFORMATION
a. Plaza Centers N.V. ("the Company" and together with its
subsidiaries, "the Group") was incorporated and is registered in the
Netherlands. The Company's registered office is at Tolstraat 112, 1074 VK,
Amsterdam, the Netherlands. In past the Company conducted its activities in
the field of establishing, operating and selling of shopping and entertainment
centres, as well as other mixed-use projects (retail, office, residential) in
Central and Eastern Europe (starting 1996) and India (from 2006). Following
debt restructuring plan approved in 2014 the Group's main focus is to reduce
corporate debt by early repayments following sale of assets and to continue
with efficiency measures and cost reduction where possible.
The consolidated financial statements for each of the periods presented
comprise the Company and its subsidiaries (together referred to as the
"Group").
The Company is listed on the premium segment of the Official List of the UK
Listing Authority and to trading on the main market of the London Stock
Exchange ("LSE"), the Warsaw Stock Exchange ("WSE") and on the Tel Aviv Stock
Exchange ("TASE").
b. Going concern and liquidity position of the Company:
As of December 31, 2025, the Company's outstanding obligations to bondholders
(including accrued interests) are app. EUR 177 million with due date that was
postponed to July 1, 2026 (the "Current Due date") (please refer to note 7).
Due to the above the Company's primary need is for liquidity. The Company's
current and future resources include the following:
1. Cash and cash equivalents (including the cash of fully owned
subsidiaries) of approximately EUR 1.847 million.
2. As detailed in note 5(1)(e), the Company and AFI Europe N.V. entered
into an addendum to the pre-sale agreement entered into between the Parties in
connection with the sale of its subsidiary (the "SPV") which holds 75% in the
Casa Radio Project (the "Project") (the "Addendum" and the "Agreement",
respectively) pursuant to which the Parties agreed to extend the Long Stop
Date, which is the date on which the parties will execute a share purchase
agreement, subject to the satisfaction of conditions precedent (the "SPA"(,
until December 31, 2026. There can be no certainty that the SPA will
eventually be executed and/or that the transaction will be consummated as
presented above or at all.
3. In addition, as detailed in note 5(2), the Company has submitted with
the International Centre for Settlement of Investment Disputes ("ICSID") a
Request for Arbitration (the "Request") against Romania for compensation of
losses incurred due to failure of the Romanian authorities to cooperate,
negotiate and adjust the PPP agreement as described in the note 5(1)(c) which
include the Company's investment in the Project SPV, loss of potential profit,
and costs and expenses of the arbitration. At this stage there is no certainty
about the result of the dispute, hence no resources are expected to be
available in the foreseeable future.
NOTE 1: - CORPORATE INFORMATION (Cont.)
As of December 31, 2025, the Company is not in compliance with the main
Covenants as defined in the restructuring plan (for more details refer also to
Note 7), hence constituting an event of default which could also trigger early
repayment demand by the bondholders.
Due to the abovementioned and due to the board and management estimation that
the Company is unable to repay its entire debt on the updated due date, the
Company intends to request the bondholders of both series an additional
postponement of the repayment of the remaining balance of the bonds. However,
there is no certainty that the bondholders will approve the request. In the
case that the bondholders would declare their remaining claims to become
immediately due and payable, the Company would not be in a position to settle
those claims and would need to enter to an additional debt restructuring.
Due to the abovementioned conditions, a material uncertainty exists that casts
significant doubt about the Company's ability to continue as a going concern.
NOTE 2:- MATERIAL ACCOUNTING POLICIES
a. Basis of preparation of these financial statements:
The following accounting policies have been applied consistently in the
financial statements for all periods presented, unless otherwise stated.
The consolidated financial statements have been prepared in accordance with
IFRS Accounting Standards ("IFRS"), as adopted by the European Union ("EU").
The consolidated financial statements have been prepared on the historical
cost basis.
These consolidated financial statements are not intended for statutory filing
purposes. The Company is required to file consolidated financial statements
prepared in accordance with
the Netherlands Civil Code.
At the date of approval of these financial statements the Company had not yet
submitted consolidated financial statements for the year ended December 31,
2019, December 31, 2020, December 31, 2021, December 31, 2022, December 31,
2023, December 31, 2024 and December 31, 2025 in accordance with the
Netherlands Civil Code (for more details refer to Note 15(b)(6)).
The consolidated financial statements were authorized to be issued by the
Board of Directors on March 31, 2026.
b. Functional and presentation currency:
These consolidated financial statements are presented in EURO ("EUR"), which
is the Company's functional currency. All financial information presented in
EUR has been rounded to the nearest thousand, unless otherwise indicated.
NOTE 2:- MATERIAL ACCOUNTING POLICIES (Cont.)
c. Functional and presentation currency
The EUR is the functional currency for Group companies since it is the
currency of the economic environment in which the Group operates. This is
because the EUR is the main currency in which management determines its
pricing with potential buyers and suppliers, determine its financing
activities and budgets and assesses its currency exposures.
d. Use of estimates and judgments:
The preparation of the consolidated financial statements in conformity with
IFRS as adopted by the EU requires management to make judgments, estimates and
assumptions that affect the application of accounting policies and the
reported amounts of assets and liabilities, income and expenses.
The estimates and associated assumptions are based on historical experience
and various other factors that are believed to be reasonable under the
circumstances, the results of which form the basis of making the judgments
about carrying values of assets and liabilities that are not readily apparent
from other sources. Actual results may differ from these estimates.
Information about assumptions and estimation uncertainties that have a
significant risk of resulting in a material adjustment within the next
financial year are included in the following notes:
- Notes 5 - key assumptions used in determining the net
realisable value of trading properties;
- Notes 5,15 - recognition and measurement of provisions and
contingencies: key assumptions about the likelihood and magnitude of an
outflow of resources.
e. Basis of consolidation:
1. Subsidiaries:
Subsidiaries are entities controlled by the Group. The Group controls an
entity when it is exposed to, or has rights to, variable returns from its
involvement with the entity
and has the ability to affect those returns through its power over the entity.
The financial statements of subsidiaries are included in the consolidated
financial statements from the date on which control commences until the date
on which control
ceases. Where necessary, adjustments are made to the financial statements of
the subsidiaries in order to bring the accounting policies used in line with
the ones used by the Group in the consolidated financial statements.
f. Foreign currency:
1. Foreign currency transactions:
Transactions in foreign currencies are translated to the respective functional
currencies of Group companies at exchange rates at the dates of the
transactions.
NOTE 2:- MATERIAL ACCOUNTING POLICIES (Cont.)
Monetary assets and liabilities denominated in foreign currencies are
translated to the functional currency at the exchange rate at the reporting
date. Non-monetary assets and liabilities that are measured at fair value in a
foreign currency are translated to the functional currency at the exchange
rate when the fair value was determined.
Foreign currency differences are generally recognised in profit or loss.
Non-monetary items that are measured based on historical cost in a foreign
currency are translated at the exchange rate at the date of the transaction.
Foreign currency differences are generally recognised in profit or loss.
2. Foreign operations:
The assets and liabilities of foreign operations, including goodwill and fair
value adjustments arising on acquisition, are translated into euro at the
exchange rates at the reporting date. The income and expenses of foreign
operations are translated into euro at the exchange rates at the dates of the
transactions. Foreign currency differences are recognised in other
comprehensive income, and accumulated in the translation reserve, except to
the extent that the translation difference is allocated to non-controlling
interest.
When a foreign operation is disposed of in its entirety or partially such that
control, significant influence or joint control is lost, the cumulative amount
in the translation reserve related to that foreign operation is reclassified
to profit or loss as part of the gain or loss on disposal.
If the Group disposes of part of its interest in a subsidiary but retains
control, then the relevant proportion of the cumulative amount is reattributed
to non-controlling interest.
When the Group disposes of only part of an associate or joint venture while
retaining significant influence or joint control, the relevant proportion of
the cumulative amount is reclassified to profit or loss.
If the settlement of a monetary item receivable from or payable to a foreign
operation
is neither planned nor likely to occur in the foreseeable future, then foreign
currency differences arising from such item form part of the net investment in
the foreign operation. Accordingly, such differences are recognised in other
comprehensive income and accumulated in the translation reserve.
3. Index-linked monetary items:
Monetary assets and liabilities linked to the changes in the Israeli Consumer
Price Index ("Israeli CPI") are adjusted at the relevant index at each
reporting date according to the terms of the agreement.
NOTE 2:- MATERIAL ACCOUNTING POLICIES (Cont.)
g. Cash equivalents:
Cash equivalents are considered as highly liquid investments, including
unrestricted short-term bank deposits with an original maturity of three
months or less from the date of investment or with a maturity of more than
three months, but which are redeemable on demand without penalty and which
form part of the Group's cash management.
h. Financial instruments:
1. Financial liabilities:
a) Financial liabilities measured at amortized cost:
Financial liabilities are initially recognized at fair value less transaction
costs that are directly attributable to the issue of the financial liability.
After initial recognition, the Company measures all financial liabilities at
amortized cost using the effective interest rate method.
2. De-recognition of financial liabilities:
A financial liability is derecognized only when it is extinguished, that is
when the obligation specified in the contract is discharged or cancelled or
expires. A financial liability is extinguished when the debtor discharges the
liability by paying in cash, other financial assets, goods or services; or is
legally released from the liability.
i. Fair value measurement
A number of the Group's accounting policies and disclosures require the
measurement of fair value, for both financial and non-financial assets and
liabilities.
When measuring the fair value of an asset or a liability, the Group uses
market observable
data as far as possible. The Company's finance department reviews significant
unobservable inputs and valuation adjustments. If third party information,
such as broker quotes, is used to measure fair values, then the finance
department assesses the evidence obtained from the third parties to support
the conclusion that such valuations meet the requirements of IFRS, including
the level in the fair value hierarchy in which such valuations should be
classified. Fair values are categorized into different levels in a fair
value hierarchy based on the inputs used in the valuation techniques as
follows:
- Level 1: quoted prices (unadjusted) in active markets for
identical assets or liabilities.
- Level 2: inputs other than quoted prices included in Level 1
that are observable for the asset or liability, either directly (i.e. as
prices) or indirectly (i.e. derived from prices)
- Level 3: inputs for the asset or liability that are not based
on observable market data (unobservable inputs)
NOTE 2:- MATERIAL ACCOUNTING POLICIES (Cont.)
Further information about the assumptions made in measuring fair values is
included in the following notes:
Note 15 - Financial instruments
j. Trading properties:
Trading properties are being designated for sale in the ordinary course of
business and as such are classified as trading properties (inventory) and
measured at the lower of cost and
net realizable value.
Net realizable value is the estimated selling price in the ordinary course of
business less the estimated costs to complete construction and selling
expenses. If net realizable value is less than the cost, the trading property
is written down to net realizable value.
In each subsequent period, a new assessment is made of net realizable value.
When the circumstances that previously caused trading properties to be written
down below cost no longer exist or when there is clear evidence of an increase
in net realizable value because of changed economic circumstances, the amount
of the write-down is reversed so that the new carrying amount is the lower of
the cost and the revised net realizable value.
The amount of any write-down of trading properties to net realisable value and
all losses of trading properties are recognised as a write-down of trading
properties expense in the period the write-down or loss occurs. The amount of
any reversal of such write-down arising from an increase in net realizable
value is recognized as a reduction in the expense in the period in which the
reversal occurs.
k. Finance income and cost:
Interest income and expense which are not capitalized are recognized in the
income statement as they accrue, using the effective interest method.
l. Initial application of new Amendments:
1. Amendments to IAS 21, "The Effects of Changes in Foreign
Exchange Rates":
In August 2023, the IASB issued "Amendments to IAS 21: Lack of Exchangeability
(Amendments to IAS 21, "The Effects of Changes in Foreign Exchange Rates")"
("the Amendments") to clarify how an entity should assess whether a currency
is exchangeable and how it should measure and determine a spot exchange rate
when exchangeability is lacking.
The Amendments set out the requirements for determining the spot exchange rate
when a currency lacks exchangeability. The Amendments require disclosure of
information that will enable users of financial statements to understand how a
currency not being exchangeable affects or is expected to affect the entity's
financial performance, financial position and cash flows.
NOTE 2:- MATERIAL ACCOUNTING POLICIES (Cont.)
The Amendments apply for annual reporting periods beginning on or after
January 1, 2025. Earlier adoption is permitted, in which case, an entity is
required to disclose that fact. When applying the Amendments, an entity should
not restate comparative information. Instead, if the foreign currency is not
exchangeable at the beginning of the annual reporting period in which the
Amendments are first applied (the initial application date), the entity should
translate affected assets, liabilities and equity as required by the
Amendments and recognize the differences as of the initial application date as
an adjustment to the opening balance of retained earnings and/or to the
foreign currency translation reserve, as required by the Amendments .
The Company has assessed the impact of the Amendments and concluded that they
do not have a material impact on its consolidated financial statements.
m. Disclosure of new Standards not
yet effective:
1. Amendments to IFRS 9, "Financial Instruments", and IFRS 7,
"Financial Instruments: Disclosures":
On May 30, 2024, the IASB issued "Amendments to the Classification and
Measurement of Financial Instruments - Amendments to IFRS 9 and IFRS 7" ("the
Amendments"). The Amendments clarify certain aspects of the classification and
measurement of financial instruments.
The Amendments address the following:
· Derecognition of liabilities via electronic payment systems: Entities
may elect to derecognize financial liabilities settled electronically before
the settlement date if conditions are met and applied consistently.
· Assessment of contractual cash flows: Clarifies classification of
financial assets with ESG-linked and other contingent features. Updates
definitions of 'non-recourse' and contractually linked instruments (CLIs).
· Disclosures: New IFRS 7 requirements for assets and liabilities with
contingent features (e.g., ESG-linked) and for equity investments measured at
FVTOCI.
Effective retrospectively for annual periods starting on or after January 1,
2026, with early adoption allowed (partial early adoption permitted).
Restatement of prior periods is optional if hindsight is not used.
The Company is evaluating the implications of the adoption of the Amendments
on its consolidated financial statements.
2. IFRS 18, "Presentation and Disclosure in Financial Statements":
In April 2024, the International Accounting Standards Board
("the IASB") issued IFRS 18, "Presentation and Disclosure in Financial
Statements" ("IFRS 18") which replaces IAS 1, "Presentation of Financial
Statements".
NOTE 2:- MATERIAL ACCOUNTING POLICIES (Cont.)
IFRS 18 is aimed at improving comparability and transparency of communication
in financial statements. IFRS 18 builds on IAS 1, introducing new presentation
requirements for the statement of profit or loss, including specified
subtotals and disclosure of management-defined performance measures. It also
sets rules for aggregating and disaggregating financial information.
While recognition and measurement rules remain unchanged, profit or loss items
must now be classified into five categories (operating, investing, financing,
income taxes, and discontinued operations), which may affect reported
operating profit. IFRS 18 also led to related updates to IAS 7 and IAS 34.
IFRS 18 is effective for annual reporting periods beginning on or after
January 1, 2027, and is to be applied retrospectively. Early adoption is
permitted subject to disclosure.
The Company is evaluating the effects of IFRS 18, including the effects of the
consequential amendments to other accounting standards, on its consolidated
financial statements.
NOTE 3:- CASH AND CASH EQUIVALENTS
December 31,
Bank deposits and cash denominated in 2025 2024
EUR - bank balances (1) 499 2,365
New Israeli Shekel (NIS) - bank balances (2) 1,211 136
Other currencies 137 87
1,847 2,588
(1) As of December 31, 2025, including deposit of EUR 0,36 million -
1,3-1,7% interests rate (as of December 31, 2024 - EUR 1,8 million - 2,35%
interests rate).
(2) As of December 31, 2025, including deposit of EUR 1,2 million - 3,7-4,4%
interests rate.
NOTE 4:- OTHER INCOME
December 31,
2025 2024
Other income (1) 445 58
445 58
(1) For 2025 - refer to Note 15(b)(5).
NOTE 5:- TRADING PROPERTIES
(1) Casa Radio:
(a) General:
In 2006 the Company entered into a PPP agreement with the Government of
Romania to develop the Casa Radio site in the city center of Bucharest
("Project") and acquired 75% interest in the joint venture company developing
the Project ("Project SPV"). After signing the PPP agreement, the Company
holds indirectly 75% of the shares in the Project SPV, the remaining shares
are held by the Romanian authorities (through CNI, a Romanian company
ultimately owned by the Romania authorities)(15%) and a third-party private
investor (10%).
Pursuant to the PPP agreement, the Project SPV was granted development and
exploitation rights in relation to the site for a period of 49 years, starting
December 2006 (34 years remaining at the end of the reporting period). As part
of its obligations under the PPP agreement, the Project SPV has committed to
construct a public authority building ("PAB") measuring approximately 11.000
square meters for the Romanian Government at its own cost.
Large scale demolition, design and foundation works were financed by loans
given to the Project SPV by the Company. These works were performed on site
until 2010. Construction and development were put on hold due to difficulties
procuring further financing because of the global financial crisis and later,
as well as, the lack of progress in the renegotiation of the PPP agreement
with the Romanian authorities, as detailed in subsection (c) below. These
circumstances (and mainly the bureaucratic deadlock with the Romanian
authorities to deal with the issues specified below) caused the Project SPV
not to meet the development timeline of the Project as specified in the PPP
agreement. However, management believes that it had legitimate reasons for the
delays in this timeline, as discussed in subsection (c) below.
(b) Obtaining of the Detailed Urban Plan ("PUD") permit:
The Project SPV obtained the PUD for the Project in September 2012. On
December 13, 2012, the Court took note of the waiver of the claim submitted by
certain plaintiffs and rejected the litigation aiming to cancel the approval
of the Zonal Urban Plan ("PUZ") for the Project. The Court decision is
irrevocable.
(c) Discussions with the Romanian authorities:
Following the Court decision with respect to the PUZ, the Project SPV was
required to submit a request for building permits within 60 days from the
approval date of the PUZ/PUD and commence development of the Project within 60
days after obtaining the building permits. The building permits have not
been obtained.
NOTE 5:- TRADING PROPERTIES (Cont.)
Due to substantial differences between the approved PUD and stipulations in
the PPP agreement and changes in EU law concerning environmental
considerations in buildings used by public bodies, the Project SPV attempted
to renegotiate the future development of the Project with the Romanian
authorities on items such as timetable, structure, milestones and adaptation
of the PAB development to the current EU requirements. Despite many
notifications sent to the Romanian authorities, expressing a wish to
renegotiate the existing PPP agreement, no major breakthrough has been
achieved. The Company may be subject to significant delay penalties under the
terms of the PPP agreement if it is determined that the Company was at fault
in causing the delays.
Because of the failure of the Romanian authorities to cooperate, negotiate and
adjust the PPP agreement, the Project SPV was not able to meet its obligations
under the PPP agreement. This resulted in a situation where the Project SPV
could not "de facto" continue the execution of the Project and created a risk
that the Romanian authorities could attempt to terminate the PPP agreement
and/or to impose penalties on the Company and the Project SPV. As of the date
of approval of these consolidated financial statements, the Project SPV has
not received any termination notification from the Romanian authorities.
Still, in the case of termination of the PPP agreement, any disputes regarding
the relationship and compensation between the parties is to be determined by
way of arbitration. Management, believes that, in the case of termination, the
Company has a good case to claim compensation for damages.
The Romanian authorities undertook to discuss in good faith the restructuring
of the Project and the PPP agreement in situations where significant
unexpected circumstances arise. Further, the unresponsiveness of the Romanian
authorities is a violation of the general undertaking to support the Project
SPV in the execution of the Project as agreed in the PPP agreement.
Management has taken a number of steps in order to unblock the development of
the project and mitigate the risk of termination of the PPP agreement,
including commencing a process to identify third party investors willing and
capable to join in the development of the Project and/or potential buyers of
the Company's interest in the Project. Management believes that reputable
investors with considerable financial strength can enhance negotiation
position vis-à-vis the Romanian authorities and assist in advancing an
amicable agreement with the relevant authorities with respect to the
development of the Project. As a result of the Company's ongoing efforts, a
pre-sale agreement for the sale of its shareholding in the Project SPV and its
interests in the Project was signed on 3 July 2019 (see subsection (e) below).
NOTE 5:- TRADING PROPERTIES (Cont.)
(d) Provision in respect of PAB:
As mentioned in point (a) above, when the Company entered
into an agreement to acquire 75% interest in the Project SPV it assumed a
commitment to construct the PAB at its own costs for the benefit of the
Romanian Government. As detailed in note 5(2) below, the carrying amount of
the trading property was fully written off as of December 31, 2020.
Accordingly, the Company also fully reduced the provision in respect of the
construction of the PAB as of December 31, 2020.
(e) On 3 July 2019 the Company's wholly owned
subsidiary Dambovita Center Holding B.V ("Dambovita NL") as seller, the
Company as guarantor and AFI Europe N.V. as buyer entered into a pre-sale
agreement for the sale of the shareholding in Dambovita Center S.R.L
("Dambovita RO") (the "Pre-Sale Agreement"). Pursuant to the terms of the
Pre-Sale Agreement, AFI Europe N.V. shall carry out a due diligence review
which shall be completed no later than 5 September 2019 following which,
subject to the satisfaction of the other Conditions precedent in the Pre-Sale
Agreement, the parties to the Pre-Sale Agreement will execute a share purchase
agreement in the short form being Annex 3 to the Pre-Sale Agreement (the
"SPA") and an intragroup loan assignment/novation agreement.
Conditions precedent in the Pre-Sale
Agreement comprise inter alia (i) the satisfactory completion of a due
diligence investigation by AFI Europe N.V. by the latest on 5 September 2019;
(ii) the Romanian competition council having issued competition approval for
the transaction; (iii) publication of the contemplated sale of the shares in
Dambovita RO by Dambovita NL in the Official Gazette of the Romanian
Government and the lapse of a 30-day objection period with no opposition being
lodged; (iv) no pending or imminent material adverse change (which includes
insolvency of Dambovita RO, termination of the PPP Agreement or a significant
amendment of the terms and conditions of the PPP Agreement rendering the
fulfilment thereof more onerous; (v) issuance of a Government Decision
confirming
that Dambovita NL may transfer the shares
to AFI Europe N.V.(or any of its affiliates) and that the Company and Elbit
Imaging Ltd. may transfer their rights and obligations under the PPP Agreement
to AFI Europe N.V.(vi); amendment of the PPP Agreement in order to transfer
the rights of Elbit Imaging Limited and the Company to AFI Europe N.V.; (vii)
obtaining a written confirmation that the 49 years term of the PPP Agreement
shall be calculated, the earliest, starting from 2012,
however, in case the 49 years concession
term is calculated from any other previous date, the parties to the Pre-Sale
Agreement will try to find an amicable compromise, discounting the Purchase
Price (as defined below) to reflect the shorter concession term; in case of
such parties' failure to reach an agreement with respect to the discounted
Purchase Price, AFI Europe N.V. has the right to consider this condition
precedent as not being fulfilled; and (viii) the receipt of approval of the
General Meeting and the Company's bondholders for the Transaction.
NOTE 5:- TRADING PROPERTIES (Cont.)
Upon satisfactory completion of the due diligence to be
carried out by AFI Europe, there will be a down payment of EUR 200,000, which
shall be repaid upon the occurrence of (i) cancellation of the PPP Agreement;
(ii) initiation of Dambovita RO's dissolution due to negative equity
requirements; (iii) the existence of elements of criminal investigation
against Dambovita RO, beyond the information as disclosed to AFI Europe or, if
such investigation would be held against Dambovita RO's directors of
employees, in case this would trigger a significant impact on the Dambovita
Project or (iv) Dambovita NL refuses to proceed to closing or is not present
at the closing date, although all the conditions precedent were fulfilled or
waived. The fulfilment of the Conditions precedent relating to the approval of
the Company's shareholders and bondholders as referred to above must occur no
later than 5 September 2019. On 30 July 2019, the bondholders of Bonds series
A and Bonds Series B decided to authorize the Company to enter into the
agreement and execute the transaction contained therein. In addition, an
extraordinary general meeting of Shareholders of the Company held on 29 August
2019 approved the transaction as detailed in the Notice of EGM.
On 5 September 2019 in accordance with the pre-sale agreement, AFI has paid
the down payment of EUR
200,000.
PRE-SALE AGREEMENT - SPECIFIC PROVISIONS
The long stop date as referred to in the Pre-Sale Agreement (i.e. the date on
which all conditions precedent must be fulfilled and closing of the
Transaction must occur) is 15 months after the lapse of the due diligence
period (5 September 2019).
Pursuant to the Pre-Sale Agreement, Dambovita NL will transfer its interest in
Dambovita RO and will assign the Intragroup Loans to AFI Europe N.V. for the
maximum consideration of EUR 60 million, subject to the fulfilment of certain
conditions (the "Purchase Price").
The Purchase Price is defined in the Pre-Sale Agreement as EUR 60 million
minus 75% of Dambovita RO's liabilities computed based on the closing accounts
(being the financial statements of Dambovita RO for the period from 1 January
of the year in which the closing of the Transaction will occur) and excluding
the Intragroup Loan, plus 75% of Dambovita RO's available cash and other
current assets as shown in the closing accounts (as referred to above) and
minus (insofar applicable) an amount agreed upon by the parties to the
Pre-Sale Agreement to be reduced from the Purchase Price if the 49-year
PPP-rights period will be calculated from any date prior to the year 2012. The
loan assignment amount (as part of the Purchase Price) will be
calculated on the Closing Date as the balance between the Purchase Price and
the price for the shares sold (being the nominal value of these shares RON
44,050,380, which is the equivalent of USD 14,778,862).
NOTE 5:- TRADING PROPERTIES (Cont.)
Subject to fulfilment of the conditions precedent in the Pre-Sale Agreement as
detailed above which includes, among others, the execution of the SPA, AFI
Europe N.V. is bound to make a payment of EUR 20 million to Dambovita NL. A
further EUR 22 million is to be paid later upon the issuance by the competent
authorities of a building permit for the first stage of the Dambovita Project
(the development of the shopping mall or the office building, excluding the
public authority building as referred to above). The balance between the
Purchase Price and the payments already made, will be paid out to Dambovita NL
upon all permits required for the operation of any of the components (office
building or shopping mall) of the first stage of the Dambovita Project
including a fire permit and the operation permit having been obtained. In
addition the Company and Dambovita NL, granted the AFI Europe N.V.
indemnification, jointly and severally, for some warranties under the Pre-Sale
Agreement, which customary in such transactions.
On November 2, 2020, the Company, Dambovita NL and AFI Europe N.V. ("AFI", and
together with the Company, the "Parties") entered into an addendum to the
pre-sale pursuant to which the Parties agreed to extend the Long Stop Date,
which is the date on which the parties will execute a share purchase
agreement, subject to the satisfaction of conditions precedent, until December
31, 2021.
The Parties have further agreed that in case of any litigation and/or
arbitration process to which the Company is a party, will result in the loss
of any of their rights under the PPP Agreement with the Government of Romania
to develop the Casa Radio site in the city center of Bucharest, AFI shall no
longer be bound by its obligations under the Agreement and the Company shall
reimburse AFI with the entire advance payment of EUR 200,000 already paid by
AFI. The prepayment of EUR 200,000 is included in Other Liabilities in the
consolidated statement of financial position. The Addendum was subject to the
approval of the Company's bondholders which was obtained on November 12, 2020.
The Company, Dambovita NL and AFI signed a series of addenda to the Agreement
extending the Long Stop Date as follows:
• Addendum 2 (December 20, 2021) - extended to December 31, 2022
• Addendum 3 (December 13, 2022) - extended to December 31, 2023
• Addendum 4 (December 04, 2023) - extended to December 31, 2024
• Addendum 5 (December 05, 2024) - extended to December 31, 2025
• Addendum 6 (November 20, 2025) - extended to December 31, 2026
As of the date hereof, there can be no certainty that either the conditions
precedent in the Pre-Sale Agreement as detailed above will be met, that the
Sale Agreement will be executed and/or that the Transaction will be
consummated as presented above or at all.
NOTE 5:- TRADING PROPERTIES (Cont.)
(2) Write-down of trading properties:
Trading properties are measured at the lower of cost and net realizable value.
Determining net realizable value is inherently subjective as it requires
estimates of future events and takes into account special assumptions in the
valuations, many of which are difficult to predict.
Actual results could be significantly different than the Company's estimates
and could have a material effect on the Company's financial results.
These valuations become increasingly difficult as they relate to estimates and
assumptions for projects in the preliminary stage of development.
Management is responsible for determining the net realizable value of the
Group's trading properties.
As detailed above, despite many notifications sent to the Romanian authorities
expressing a wish to renegotiate the existing PPP agreement, no major
breakthrough could be achieved, in addition, the Romanian authorities have not
cooperated substantively with the Company's request to approve the transfer of
the Company's shares in the Project SPV and its interest in the Project to
AFI.
Because of the abovementioned issues surrounding the satisfaction of the
conditions precedent in the pre-sale agreement, it is currently not certain
whether the sale agreement as contemplated in the pre-sale agreement would be
entered into and whether therefore the transaction with AFI would proceed. As
such the Company, Dambovita NL and AFI Europe N.V. agreed to extend the Long
Stop Date until December 31, 2026. Additionally, as the external appraisers,
in their opinion from the previous years did not reflect the risk related to
the uncertainty in respect of fulfilment of the conditions precedent set out
in the pre-sale agreement, as described above, management has concluded that
it can't measure the net realizable value of the Project based on either the
pre-sale agreement or based on the residual value approach as management would
need to assume that it would receive the
Romanian authorities approval to restructure and adjust the PPP agreement. As
a result, the value of the trading property of the Project was fully reduced.
Still, the Company believes that despite this reduction there is no change in
the value of the Company's rights under the PPP Agreement. In addition,
management, believes that the Company has a good case to claim compensation
for economic damages. On the other hand, if the Company comes to an
understanding with the Romanian authorities, it will measure the Casa Radio
NRV to reflect its updated financial projections.
The Company is actively pursuing all available options, including legal
avenues, to achieve progress. On May 16, 2022, it submitted a Request for
Arbitration with the International Centre for Settlement of Investment
Disputes ("ICSID") against Romania, seeking full compensation for losses
incurred due to Romania's failure to cooperate, negotiate, and adjust the PPP
agreement (as outlined in Note 5(1)(c)). These claims include the Company's
investment in the Project SPV, loss of potential profit, and arbitration
costs.
NOTE 5:- TRADING PROPERTIES (Cont.)
The Request was registered on June 3, 2022, and the Tribunal was constituted
on November 1, 2022. The Company filed its Memorial and supporting evidence on
April 6, 2023, and successfully opposed Romania's Request for Bifurcation on
May 18, 2023, ensuring the Arbitration proceeds as a single phase.
The hearing was held in the fourth quarter of 2024, and the Tribunal's award
is expected in April of 2026.
On July 12, 2023, Plaza and Dambovita Center SRL (a subsidiary of Plaza and
the Project Company in charge of the Casa Radio Project) received a notice of
default from the Ministry of Finance under the public-private partnership
contract governing the Casa Radio Project.
On July 15, 2024, Plaza received a notice from the Romanian Ministry of
Finance initiating arbitration under London Court of International Arbitration
("LCIA") rules against the Company, Elbit Imaging Ltd, and a third-party
private investor (collectively, the "Respondents").
On October 24, 2025, the Romanian Ministry of Finance filed its Statement of
Claim, formally requesting termination of the 2006 Public Private Partnership
(PPP) Agreement, seeking the return of all project assets to the Romanian
State and claiming compensation for alleged losses and penalties.
The Company denies all claims formulated by the Ministry of Finance in the
ongoing LCIA arbitration with Romania.
NOTE 6:- OTHER LIABILITIES
December 31,
2025 2024
Prepayments (1) 200 200
Salaries and related expenses 2 12
Accrued expenses 69 336
Total 271 548
(1) Comprises EUR 200 thousand payable due to down payment in regard
to pre-sale agreement for the sale of Casa Radio Project (refer to note
5(1)(e)).
NOTE 7:- BONDS
a. Composition:
Effective interest rate Contractual interest rate Principal final maturity Carrying amounts
as at
December 31 2025
Series A Bonds 11.58% CPI+8%((*)) July 2026 42,302
Series B Bonds 13.83% CPI+8.9%((*)) July 2026 59,588
101,890
(*) Including 2%
interest on arrears
b. Mandatory repayments subsequent to the reporting date (without
early repayments):
2026 101,890
101,890
(1) Pursuant to the Company's Restructuring Plan, the Company will
assign 78% of the net proceeds received from the sale or refinancing of any of
its assets as early repayment.
(2) Approved amendment to an early prepayment term under the
Restructuring Plan
The Company has implemented the restructuring plan that was approved by the
Dutch Court on July 9, 2014 (the "Restructuring Plan"). Under the
Restructuring Plan, principal payments under the bonds issued by the Company
and originally due in the years 2013 to 2015 were deferred for a period of
four and a half years, and principal payments originally due in 2016 and 2017
were deferred for a period of one year.
During the first three months of 2017, the Company paid to its bondholders a
total amount of NIS 191.7 million (EUR 49.2 million) as an early redemption.
Upon such payments, the Company complied with the Early Prepayment Term (early
redemption at the total sum of at least NIS 382,000,000 (approximately EUR 98
million)) and thus obtained a deferral of one year for the remaining
contractual obligations of the bonds.
NOTE 7:- BONDS (Cont.)
In addition to the above, the following terms were approved by the
bondholders:
(a) Casa Radio proceeds - If the Company shall sell the Casa Radio
project located in Romania (hereinafter: the "Project") to a third party,
including by way of selling its holdings in any of the entities through which
the Company holds the project (and said sale shall be carried out before the
full repayment of the bonds and until no later than December 31, 2019, and for
an amount which exceeds EUR 45 million net (i.e. after brokerage fees (if
any), taxes, fees, levies or any other obligatory payment due to any authority
in respect to the said sale) which shall actually be received by the Company,
then the holders of bonds shall be eligible for a one-time payment (which
shall come in addition to the principal and interest payments in accordance
with the repayment schedule), in certain amounts specified in tranches.
(b) Registering of Polish bonds for trade - the Company has committed
to undertake best efforts to admit the Polish bonds for trading on the Warsaw
Stock Exchanges and proceeding in this respect are ongoing.
(c) Deferred debt ratio of Series B bonds - were reduced to 68.24%
from 70.44%
following the cancellation of the treasury bonds. The ratio
has been changed for Series B bonds in order to maintain a distribution ratio
between the three series.
c. Settlement agreement with Bondholders of
Israeli Series of Bonds:
In January 2018, a settlement agreement was signed by and among the Company
and the two Israeli Series of Bonds ("Settlement Agreement"). In the
Settlement Agreement it was agreed, inter alia, to approve:
- New repayment ratios between the two Israeli Series of Bonds
(new ratio: Bond A- 39% Bond B- 61%);
- An increase in the level of the mandatory early repayments
from 75% to 78% of the relevant net income;
- New repayment schedule;
- An increase in the compensation to be paid to the Bondholders
in the event of successful disposal of Casa Radio Project;
- A waiver of claims to the Company and its directors and
officers; and
- To waive the request for publication of quarterly financial
reports by the Company.
As a result of settlement agreement signing, Series A Bondholders withdraw
their request for immediate repayment.
It is clarified that the Settlement Agreement is a separate agreement among
the parties thereto with respect to the Company's restructuring plan, and as
such has no effect on the Polish Bondholders.
NOTE 7:- BONDS (Cont.)
On January 31, 2018 the Company paid the bondholders a total amount of
principal and interest of EUR 38,487 thousand.
(1) The net cash flow received by the Company following an exit or
raising new financial indebtedness (except if taken for the purpose of
purchase, investment or development of real estate asset) or refinancing of
real estate assets after the full repayment of the asset's related debt that
was realized or in respect of
a loan paid in case of debt recycling (and in case where the exit occurred in
the subsidiary - amounts required to repay liabilities to the creditors of
that subsidiary) and direct expenses in respect of the asset (any sale and tax
costs, as incurred), will be used for repayment of the accumulated interest
till that date in all of the series (in case of an exit which is not one of
the four shopping centres only 50% of the interest) and 78% of the remaining
cash (following the interest payment) will be used for an early repayment of
the close principal payments for each of the series (A, B, Polish) each in
accordance with its relative share in the deferred debt. Such prepayment will
be real repayment and not in bond purchase.
(2) On November 22, 2018 the Company announced based on its current
forecasts, the Company expected to pay the accrued interest on Series A and
Series B Bonds on December 31, 2018, in accordance with the repayment schedule
determined in the Company's Restructuring Plan and Settlement Agreement with
Series A and Series B Bondholders from 11 January 2018 (the "Settlement
Agreement"). The Company noted that it will not meet its principal repayment
due on December 31, 2018 as provided for in the Settlement Agreement. The
Company may be able to partially pay the said principal depending, among other
things, on the actual sale of assets and taking into consideration the cash
needs in accordance with the scope of the forecasted activity.
2019
Following the announcement of the Company from January 2019, the Company
repaid in February 2019 circa EUR 400,000 (principal of circa EUR 250,000 and
penalty interests of circa EUR 150,000) to its Series A and Series B. As
provided for in the Settlement Agreement, the bondholders approved the
deferral of payment to July 1, 2019.
In addition, during June 2019 the bondholders approved the deferral of the
full payment of principal due on July 1, 2019 and of 58% ("deferred interest
amount") of the sum of interest (consisting of the total interest accrued for
the outstanding balance of the principal, including interest for part of the
principal payment which was deferred as of February 18, 2019, plus interest
arrears for part of the principal which was fixed on 18.2.2019 and was not
paid by the Company and all in accordance with the provisions of the trust
deed; "the full amount of interest"), the effective date of which is
19.06.2019, and the payment date was fixed as of 01.07.2019. The Company paid
on the said date a total amount of circa EUR 1.17 million of which is only 42%
of the full amount of interest.
NOTE 7:- BONDS (Cont.)
On July 11, 2019, the Company announced that its Romanian subsidiary had
signed a binding agreement to sell land in Miercurea Ciuc, Romania, and that
the Company would use part of the proceeds now received by it EUR 0.75 million
(hereinafter: "the amount payable"), in order to make a partial interest
payment to the bondholders (Series A) and (Series B) issued by the Company.
The payment required changes in the repayment schedule and amendments of the
trust deeds which was approved unanimously by the Bondholders. The amount
payable was paid on August 14, 2019 and reflects 30% of accrued interest as of
that date.
On November 17, 2019 the bondholders of Series A and Series B approved a
deferral of all the scheduled Principal payment and app. 87% of deferral of
the scheduled Interest payment, both, as of December 31, 2019 to July 1, 2020.
Accordingly, in December 2019, Company made a partial interest payment in
amount of circa EUR 0.6 million of which is only 13% of the full amount of
interest.
2020
On May 4, 2020, the bondholders of Series A and Series B approved: (i) to
postpone the final redemption date to January 1, 2021 of all the scheduled
Principal; (ii) that on July 1, 2020 the Company will pay to its bondholders a
partial interest payment in the total amount of EUR 0.25 million and to defer
all other unpaid scheduled Interest payment.
Following receiving the Settlement Amount related to the final price
adjustment of the sale of Belgrade Plaza and in light of the potential
negative impact of the Covid-19 on the possibility to receive future proceeds
from the Company's plots in India, the Company decided to increase the amount
to be paid to the bondholders on July 1, 2020, from EUR 0.25 million to EUR
0.5 million. The amount reflected 6.74% of accrued interest as of that date.
On November 12, 2020, the bondholders of Series A and Series B approved: (i)
to postpone the final redemption date to July 1, 2021 of all the scheduled
Principal; that on January 1, 2021 the Company will pay to its bondholders a
partial interest payment in the total amount of EUR 0.2 million and to defer
all other unpaid scheduled Interest payment. The amount reflected 1.84% of
accrued interest as of that date.
2021
On April 12, 2021, the bondholders of Series A and Series B approved: (i) to
postpone the final redemption date to January 1, 2022; (ii) that on July 1,
2021 the Company will pay to its bondholders a partial interest payment in the
total amount of EUR 125,000 and to defer all other unpaid interest. The amount
reflected 0.84% of accrued interest as of that date.
On November 25, 2021, the bondholders of Series A and Series B approved: (i)
to postpone the final redemption date to July 1, 2022; (ii) that on January 1,
2022 the Company will pay to its bondholders a partial interest payment in the
total amount of EUR 200,000 and to defer all other unpaid interest. The amount
reflected 0.92% of accrued interest as of that date.
NOTE 7:- BONDS (Cont.)
2022
On June 16, 2022, the bondholders of Series A and Series B approved to
postpone the final redemption date to January 1, 2023.
On November 8, 2022, the bondholders of Series A and Series B approved: (i) to
postpone the final redemption date to July 1, 2023; (ii) that on January 1,
2023 the Company will pay to its bondholders a partial interest payment in the
total amount of EUR 2,000,000 and to defer all other unpaid interest. The
amount reflected 6.08% of accrued interest as of that date.
2023
Further in 2023, the bondholders of Series A and Series B approved: (i) to
postpone the final redemption date to January 1, 2024; (ii) that on July 1,
2023 the Company will pay to its bondholders a partial interest payment in the
total amount of EUR 750,000 and to defer all other unpaid interest. The amount
reflected 2.18% of accrued interest as of that date.
On November 11, 2023, the bondholders of Series A and Series B approved: (i)
to postpone the final redemption date to July 1, 2024; (ii) that on January 1,
2024 the Company will pay to its bondholders a partial interest payment in the
total amount of EUR 200,000 and to defer all other unpaid interest. The amount
reflected 0.51% of accrued interest as of that date.
2024
Further in 2024, the bondholders of Series A and Series B approved: (i) to
postpone the final redemption date to July 1, 2025.
2025
In 2024, the bondholders of Series A and Series B approved to postpone the
final redemption date to January 1, 2026 and further to postpone the final
redemption date to July 1, 2026.
As detailed in Note 1(b) the Company expects that it will not be able to meet
its entire contractual obligations in the following 12 months.
Accordingly, it intends to request the bondholders of both series to
postponement of the repayment of the remaining balance of the Bonds.
d. Covenants:
The bonds' covenants are detailed in Note 15(b)(1).
In respect of the Coverage Ratio Covenant ("CRC"), as defined in the
restructuring plan, as at December 31, 2025 the CRC is not in compliance with
118% minimum ratio required.
NOTE 7:- BONDS (Cont.)
e. Credit rating:
In January 2018, Standard & Poor's Maalot, the Israeli credit rating
agency which is a division of International Standard & Poor's has
discontinued tracking Plaza's rating at the Company's request.
NOTE 8:- INCOME TAXES
a. Unrecognized deferred tax assets:
Deferred tax assets have not been recognized in respect of tax losses due to
the fact it is not probable that future taxable profit will be available
against which the Group can utilize the benefits.
Tax losses are mainly generated from operations in the Netherlands. Tax
settlements may be subject to inspections by tax authorities. Accordingly, the
amounts disclosed in the financial statements may change at a later date as a
result of the final decision of the tax authorities.
b. Reconciliation of effective tax rate:
2025 2024
Dutch statutory income tax rate 25.8% 25.8%
Loss from continuing operations before income taxes (17,997) (28,133)
Tax benefit at the Dutch statutory income tax rate (4,644) (7,259)
Effect of tax rates in foreign jurisdictions 12 220
Current year tax loss and other timing differences for which no deferred taxes 4,632 7,039
are created
Tax Expense - -
c. The main tax laws imposed on the Group companies in their
countries of residence:
The Netherlands:
a. Companies resident in the Netherlands are subject to corporate
income tax at the general rate of 25.8%. The first EUR 200,000 of profits is
taxed at a rate of 19%. Since January 1, 2022 onwards, an indefinite loss
carry forward applies.
b. Starting January 1, 2022 losses will be
offset (forward or backward) in accordance with the following restrictions:
1. Up to 1 million EUR - unlimited
2. Over 1 million EUR - against 50% of the remaining profit in that year
NOTE 8:- INCOME TAXES (Cont.)
c. The Dutch participation exemption gives a full exemption from
corporation tax applies to benefits such as dividends and capital gains
derived from a qualifying participation. The participation exemption generally
applies if the parent Company holds at least 5 percent of the shares in the
participation. The
requirements to meet the participation exemption are as follows:
1. The parent Company has an interest of at least 5 percent in the
participation; and
2. At least one of the following three tests is met:
a) The parent Company's objective with respect to its participation is to
obtain a return that is higher than a return that may be expected from normal
active asset management ("Motive Test"); or
b) The participation is subject to a "reasonable taxation" according to
Dutch tax standards ("Subject-to-Tax Test"); or
c) The direct and indirect assets of the participation generally consist
of less than 50 percent of 'low taxed free passive investments' ("Asset
Test").
NOTE 9:- EQUITY
December 31,
2025 2024
Remarks Number of shares
Authorized ordinary shares of par value EUR 1 each 10,000,000 10,000,000
Issued and fully paid 6,855,603 6,855,603
Restriction of dividend
The Company shall not make any dividend distributions, unless (i) at least 75%
of the Unpaid Principal Balance of the Bonds has been repaid and the Coverage
Ratio on the last Examination Date prior to such Distribution is not less than
150% following such Distribution, or (ii) a Majority of the Plan Creditors
consents to the proposed Distribution.
Notwithstanding the aforesaid, in the event an additional capital injection of
at least EUR 20 million occurs, then after one year following the date of the
additional capital injection, no restrictions other than those under the
applicable law shall apply to dividend distributions in an aggregate amount of
up to 50% of such additional capital injection.
NOTE 10:- EARNINGS PER SHARE
The calculation of basic earnings per share ("EPS") at December 31, 2025 was
based on the loss attributable to ordinary shareholders of EUR 17,995 thousand
(2024: loss of EUR 28,133 thousand) and a weighted average number of ordinary
shares outstanding of 6,856 thousand (2024: 6,856 thousand).
Weighted average number of ordinary shares basic and diluted:
In thousands of shares with a EUR 1 par value December 31,
2025 2024
Issued ordinary shares at 1 January 6,856 6,856
Weighted average number of ordinary shares at 31 December 6,856 6,856
NOTE 11:- EMPLOYEE SHARE OPTION PLAN
Number Number of options
of options
2025 2024
Outstanding at the beginning of the year 1,200 5,120
Share options expired during the year (1,200) (3,920)
Outstanding at the end of the year - 1,200
Exercisable at the end of the year - 1,200
During 2025 and 2024 there were no employee costs for the share options
granted.
NOTE 12:- ADMINISTRATIVE EXPENSES
Year ended
December 31
2025 2024
Salaries and related expenses 336 338
Professional services (1) 492 2,892
Offices and office rent 64 51
Travelling and accommodation 4 12
Others - 15
Total 896 3,308
(1) Expenses include Arbitration costs incurred in 2025 in amount of
circa 190 thousand EUR (2024: 2,600 thousand EUR).
NOTE 13:- FINANCE INCOME AND FINANCE COSTS
Year ended
December 31
2025 2024
Foreign currency gain - other 54 -
Other finance income 38 121
Finance income 92 121
Interest expense on bonds (15,317) (16,289)
Other finance expenses (12) (15)
Foreign currency loss on bonds (including inflation) (2,180) (8,577)
Finance costs (17,509) (24,881)
Net finance costs (17,417) (24,760)
NOTE 14:- FINANCIAL INSTRUMENTS
Financial Risk Management:
Overview
The Group has exposure to the following risks from its use of financial
instruments:
· Credit risk
· Liquidity risk
· Market risk
This Note presents information about the Group's exposure to each of the above
risks, the Group's objectives, policies and processes for measuring and
managing risk, and the Group's management of capital.
The Board of Directors has established a continuous process for identifying
and managing the risks faced by the Group (on a consolidated basis), and
confirms that it is responsible to take appropriate actions to address any
weaknesses identified.
The Group's risk management policies are established to identify and analyse
the risks faced by the Group, to set appropriate risk limits and controls, and
to monitor risks and adherence to limits. Risk management policies and systems
are reviewed regularly to reflect changes in market conditions and the Group's
activities.
The Company's Audit Committee oversees how management monitors compliance with
the Group's risk management policies and procedures and reviews the adequacy
of the risk management framework in relation to the risks faced by the Group.
NOTE 14:- FINANCIAL INSTRUMENTS (Cont.)
a. Credit risk:
Credit risk is the risk of financial loss to the Group if a counterparty to a
financial instrument fails to meet its contractual obligations, and arises
principally from the Group's financial instruments held in banks and from
other receivables.
Management had a credit policy in place and the exposure to credit risk is
monitored on an ongoing basis.
Cash and deposits and other financial assets
The Group limits its exposure to credit risk in respect to cash and deposits,
by investing mostly in deposits and other financial instruments with
counterparties that have a credit rating of at least investment grade from
international rating agencies. Given these credit ratings, management does not
expect any counterparty to fail to meet its obligations.
b. Liquidity risk:
Liquidity risk is the risk that the Group will not be able to meet its
financial obligations as they fall due. For detailed information refer to Note
1(b).
Liquidity risk
The following are the contractual maturities of financial liabilities,
including estimated interest payments and excluding the impact of netting
agreements:
December 31, 2025
Non-derivative financial liabilities Carrying amount Contractual cash flow 6 months or less 6-12 months (*)
Bonds issued (*) (176,668) (176,668) - (176,668)
Trade and other payables (143) (143) (143) -
(176,811) (176,811) (143) (176,668)
December 31, 2024
Non-derivative financial liabilities Carrying amount Contractual cash flow 6 months or less 6-12 months (*)
Bonds issued (*) (159,171) (159,171) - (159,171)
Trade and other payables (348) (348) (348) -
(159,519) (159,519) (348) (159,171)
(*) Refer to Note 7.
NOTE 14:- FINANCIAL INSTRUMENTS (Cont.)
c. Market risk:
Currency risk:
Currency risk is the risk that the Group will incur significant fluctuations
in its profit or loss as a result of utilizing currencies other than the
functional currency of the respective Group Company.
The Group is exposed to currency risk mainly on borrowings (Bonds issued in
Israel) that are denominated in NIS.
The following exchange rate of EUR/NIS applied during the year:
Reporting date
Average rate Spot rate
EUR 2025 2024 2025 2024
NIS 1 0,257 0,250 0,267 0,263
NIS denominated bonds - a change of 5 percent in EUR/NIS rates at the
reporting date would increase/decrease loss by circa EUR 5 million, as a
result of having issued NIS linked Bonds.
This effect assumes that all other variables, in particular CPI index, remain
constant.
Interest Rate Risk (including inflation):
The Group's interest rate risk arises mainly from Bonds issued at fixed
interest rate expose the Group to changes in fair value, if the interest is
changing. Pursuant to the Company's Restructuring Plan, as described in note
7, the Company executes only partial interests payments based on current
sources and subject to approval of bondholders of both series.
Sensitivity analysis - effect of changes in Israeli CPI on carrying amount of
NIS bonds
A change of 2,6 percent in Israeli Consumer Price Index ("CPI") at the
reporting date (and in 2024) would have increased (decreased) profit or loss
by the amounts shown below. This analysis assumes that all other variables, in
particular foreign currency rates, remain constant.
Profit (loss) effect
For the year ended Carrying amount of bonds CPI increase effect CPI
December 31, decrease effect
2025 101,890 (2,649) 2,649
2024 104,040 (2,705) 2,705
NOTE 14:- FINANCIAL INSTRUMENTS (Cont.)
Shareholders' equity management:
Refer to Note 9 in respect of shareholders equity components in the
restructuring plan including dividend policy. The Company's Board of
Directors is updated on any possible equity issuance, in order to assure
(among other things) that any changes in the shareholders equity (due to
issuance of shares, options or any other equity instrument) is to the benefit
of both the Company's bondholders and shareholders.
Fair values:
The table below is a comparison between the carrying amount and fair value of
the Company's financial instruments that are presented in the financial
statements not at fair value:
Carrying amount Fair value (*)
2025 2024 2025 2024
Bonds A at amortized cost - Israeli bonds 42,302 42,943 2,455 3,204
Bonds B at amortized cost - Israeli bonds 59,588 61,097 3,676 4,514
(*) The fair value is based on Level 1 in fair value hierarchy and measured
based on market quote.
Management believes that the carrying amount of cash, receivables and trade
payables approximate their fair value due to the short-term maturities of
these instruments.
NOTE 15:- CONTINGENT LIABILITIES AND COMMITMENTS
a. Contingent liabilities and commitments to related parties:
1. The Company entered into an indemnity agreement with all of the
Company's directors and senior management - the maximum indemnification amount
to be granted by the Company to the directors shall not exceed 25% of the
shareholders' equity of the Company based on the shareholders' equity set
forth in the Company's last consolidated financial statements prior to such
payment. No consideration was paid by the Company in this respect since the
agreement was signed.
2. The Company maintains Directors' and Officers' liability cover,
presently at the maximum amount of USD 5 million for a term of 12 months
commencing on May 1, 2025. Pursuant to the terms of this policy, all the
Directors and Senior Managers are insured.
NOTE 15:- CONTINGENT LIABILITIES AND COMMITMENTS (Cont.)
b. Contingent liabilities and commitments to others:
1. As part of the completion of the restructuring plan (refer also
to Note 7), the Group has taken the following commitments and collaterals
towards the creditors:
a) Restrictions on issuance of additional bonds - The Company
undertakes not to issue any additional bonds other than as expressly provided
for in the Restructuring Plan.
b) Restrictions on amendments to the terms of the bonds - The Company
shall not be entitled to amend the terms of the bonds, with the exception of
purely technical changes, unless such amendment is approved under the terms of
the relevant series and the applicable law and the Company also obtains the
approval of the holders of all other series of bonds issued by the Company by
ordinary majority. Refer to Note 7 for recent amendments.
c) Coverage Ratio Covenant ("CRC") - the CRC is a fraction calculated
based on known Group valuation reports and consolidated financial information
available at each reporting period. The CRC to be complied with by the Group
is 118% ("Minimum CRC") in each reporting period. For December 31, 2025 the
calculated CRC is not in compliance with Minimum CRC (also refer to Note 7(d)
regarding breach of covenant). In the event that the CRC is lower than the
Minimum CRC, then as from the first cut-off date on which a breach of the CRC
has been established and for as long as the breach is continuing, the Company
shall not perform any of the following: (a) a sale, directly or indirectly, of
a Real Estate Asset ("REA") owned by the Company or a subsidiary, with the
exception that it shall be permitted to transfer REA's in performance of an
obligation to do so that was entered into prior to the said cut-off date, (b)
investments in new REA's; or (c) an investment that regards an existing
project of the Company or of a subsidiary, unless it does not exceed a level
of 20% of the construction cost of such project (as approved by the lending
bank of these projects) and the certain loan to cost ratio of the projects are
met.
If a breach of the Minimum CRC has occurred and continued
throughout a period comprising two consecutive quarterly reports following the
first quarterly/year-end report on which such breach has been established,
then such breach shall constitute an event of default under the trust deeds,
and the Bondholders shall be entitled to declare that all or a part of their
respective (remaining) claims become immediately due and payable.
d) Minimum Cash Reserve Covenant ("MCRC") - cash reserve of the Company
has to be greater than the amount estimated by the Company's management
required to pay all administrative and general expenses and interest payments
to the bondholders falling due in the following six months, minus sums of
proceeds from transactions that have already been signed (by the Company or a
subsidiary) and closed and to the expectation of the Company's management have
a high probability of being received during the following six months. MCRC is
not maintained as of December 31, 2025.
NOTE 15:- CONTINGENT LIABILITIES AND COMMITMENTS (Cont.)
e) Negative Pledge on REA of the Company - The Company undertakes that
until the bonds have been repaid in full, it shall not create any encumbrance
on any of the REA, held, directly or indirectly, by the Company except in the
event that the encumbrance is created over the Company's interests in a
subsidiary as additional security for financial indebtedness ("FI") incurred
by such subsidiary which is secured by encumbrances on assets owned by that
subsidiary.
f) Negative Pledge on the REA of Subsidiaries - The subsidiaries shall
undertake that until the bonds have been repaid in full, none of them will
create any encumbrance on any of REA except in the event that:
(i) the subsidiary creates an encumbrance over a REA owned by such
subsidiary exclusively as security for new FI incurred for the purpose of
purchasing, investing in or developing such REA; Notwithstanding the
aforesaid, subsidiaries shall be entitled to create an encumbrance on land as
security for FI incurred for the purpose of investing in and developing, but
not for purchasing, an REA held by a different Group company (hereinafter: a
"Cross Pledge"), provided the total value of the lands owned by the Group
charged with Cross Pledges after the commencement date of the plan does not
exceed EUR 35 million, calculated on the basis of book value (the "Sum of
Cross Pledges"). When calculating the Sum of Cross Pledges, lands that were
charged with Cross Pledges created prior to the commencement date of the plan
or created solely for the purpose of refinancing an existing FI shall be
excluded. The Group did not have cross-pledge as of December 31, 2025.
(ii) The encumbrance is created over an asset as security for
new FI that replaces existing FI and such asset was already encumbered prior
to the refinancing. Any excess net cash flow generated from such refinancing,
shall be subject to the mandatory early prepayment of 75%.
The encumbrance is created over interests in a Subsidiary as additional
security for FI incurred by such subsidiary which is secured by encumbrances
on assets owned by that subsidiary as permitted by sub-section (i)
above.
The encumbrance is created as security for new FI that is incurred for
purposes other than the purchase of and/or investment in and development of a
REA, provided that at least 75% of the net cash flow generated from such new
FI is used for mandatory early prepayment.
g) Limitations on incurring new FI by the Company and the subsidiaries
- The Company undertakes not to incur any new FI (including by way of
refinancing an existing FI with new FI) until the outstanding bonds debt (as
of November 30, 2014) have been repaid in full, except in any of the following
events:
NOTE 15:- CONTINGENT LIABILITIES AND COMMITMENTS (Cont.)
(i) the new FI is incurred for the purpose of investing in the
development of a REA, provided that: (a) the Loan To Cost ("LTC") Ratio of the
investment is not less than 50% (or 40% in special cases); (b) the new FI is
incurred by the subsidiary that owns the REA or, if the FI is incurred by a
different subsidiary, any encumbrance created as security for such new FI is
permitted under the negative pledge stipulation above; and (c) following such
investment the consolidated cash is not less than the MCRC;
(ii) The new FI is incurred by a subsidiary for the purpose of
purchasing a new REA by such Subsidiary, provided that following such purchase
the cash reserve is not less than the MCRC.
(iii) At least 75% of the net cash flow resulting from the incurrence of
new FI is used for a 75% early prepayment of the bonds. Subject to the terms
of the plan, the Group may also refinance existing FI if this does not
generate net cash flow.
h) No distribution policy - The Company's ability to pay dividend is
limited unless certain conditions are met.
i) 75% mandatory early repayment - Refer to Note 7 and to other
sections in this note regarding changes in increase of repayment to 78%.
2. General commitments and warranties in respect of trading
property disposals:
In the framework of the transactions for the sale of the Group's real estate
assets, the Group has provided indemnities which are customary for such
transactions to the respective purchasers.
Such indemnifications are limited in time and amount. No indemnifications were
exercised against the Group till the date of the statement and approval of the
financial position
3. The Company is liable to the buyer of its previously owned
shopping centre in the Czech Republic ("NOVO") - sold in June 2006 - in
respect to one of its tenants ("Tesco"). Tesco leased an area within the
shopping centre for a period of 30 years, with an option to extend the lease
period for an additional 30 years, in consideration for EUR 6.9 million which
was paid in advance. According to the lease agreement, the tenant has the
right to terminate the lease agreement subject to fulfilment of certain
conditions as stipulated in the agreement.
In case Tesco leaves the mall before expiration of lease
period the Company will be liable to repay the remaining consideration in
amount of EUR 1.29 million as of balance sheet date, unless the buyer finds
another tenant that will pay higher annual lease payment than Tesco. The
management does not expect to bear a material loss.
4. Contingent liabilities due to legal proceedings:
NOTE 15:- CONTINGENT LIABILITIES AND COMMITMENTS (Cont.)
The Company is involved in litigation arising in the ordinary course of its
business. Although the final outcome of each of these cases cannot be
estimated at this time, the Company's management believes, that the chances
these litigations will result in any material outflow of resources to settle
them is remote, and therefore no provision or disclosure is required.
5. Lawsuit against entities involved in the sale of U.S. shopping
centers in 2011:
In March 2018, a shareholder of the Company (hereinafter: "the Plaintiff")
filed a motion with the Economic Department of the District Court in Tel-Aviv
to reveal and review internal documents of the Company and of Elbit Imaging
Ltd. (hereinafter: "Elbit") (hereinafter: "the Motion"), in which the Court
was asked to instruct the Company and Elbit (hereinafter together: "the
Respondents") to provide the plaintiff with certain documents of the
respondents in connection with the Casa Radio project in Romania and with the
sale of the U.S. Shopping Centers in 2011.
In February 2020, an agreement was reached between the Plaintiff and the
Respondents according to which the motion will be dismissed by consent and the
plaintiff and the respondents (hereinafter: "the Parties") will jointly
examine the feasibility of the lawsuit in connection with the above events.
In light of the aforesaid, an agreement was signed between the Plaintiff, the
Respondents and First Libra Israel Ltd. (hereinafter: "Libra") according to
which Libra will finance all the expenses of filing and managing of a new
lawsuit by the Respondents against certain parties (certain officers in the
Respondents, a portion of the heirs of Motti Zisser (the former controlling
shareholder of the Respondents and other parties)) who were involved in the
Respondents' transaction for the sale of real estate in the United States in
2011 and for which funds (brokerage fees) were allegedly illegally transferred
to private companies controlled by the late Mr. Motti Zisser (hereinafter:
"Financing Agreement" and "New Lawsuit", respectively).
The parties to the Financing Agreement agreed, inter alia, that any
consideration received as a result of the New Lawsuit (to the extent received)
(hereinafter: "the Lawsuit Funds") will first be used to reimburse Libra's
expenses for the New Lawsuit (plus interest and VAT) and the balance after
deduction of such expenses (hereinafter: "the Balance of the Lawsuit Funds")
will be divided among all those involved in the New Lawsuit, so that each of
the Company and Elbit will be entitled to circa 20.75% of the Balance of the
Lawsuit Funds.
In order to ensure the distribution of the Lawsuit Funds as stated above, both
the Company and Elbit signed lien documents in favor of Libra, the Plaintiff
and the attorneys representing them (hereinafter collectively: "the
Eligibles") with respect to the reimbursement of expenses and their portion in
the Lawsuit Funds (hereinafter: "the Lien").
On October 18, 2020 the parties filed the New Lawsuit (in the amount of circa
NIS 60 million (approximately EUR 15 million)).
NOTE 15:- CONTINGENT LIABILITIES AND COMMITMENTS (Cont.)
On February 2, 2021, Ran Shtarkman filied a motion to dismiss the lawsuit
against him in limine. On April 5, 2021, the court rejected the defendant Ran
Shtarkman's motion to dismiss the lawsuit against him in limine. An appeal
that was filed to the Supreme Court in respect of this decision was denied.
On April 4, 2021, one of the defendants, Philip Meyer, filed a motion for
dismissal in limine of the lawsuit against him. On August 10, 2021, the motion
was accepted. On November 14, 2021, the Company and Elbit filed an appeal to
the Supreme Court upon this court decision. In addition, Mr. Philip Meyer
filed an appeal in respect of the court expenses which were ruled in his favor
in the court ruling. The Supreme Court scheduled dates on submission of
summaries by the parties and a court hearing with regard to the appeals filed,
to be held on May 11, 2023.
On September 14, 2021, the defendant David Zisser also filed a motion to
dismiss in limine the lawsuit against him. Following the Company's and Elbit's
motions, on November 4, 2021, the court ordered that the discussion on the
abovementioned motion will be stayed until a decision of the Supreme Court on
the appeal against Philip Meyer.
On May 31, 2023 the Company's and Elbit's appeal was accepted by Supreme Court
and a settelment agreement has been reached between Company, Elbit and the
Respondents, which was approved by the court.. According to the provisions of
the settlement agreement, the Company's portion after deducting expenses is a
few hundred thousand euros and was received partially in 2023. The Company and
Elbit will continue to handle the legal proceeding in the District Court while
each party shall maintain all of its claims in the main proceeding.
In the framework of the continued proceedings, preliminary discussions were
held between the parties. As a result, the plaintiffs and Mr. Philip Meyer
have reached a mediation agreement and on May 21, 2025. According to the
provisions of the mediation agreement, the Company's portion after deducting
expenses was received in 2025 in amount of 370 EUR. Accordingly, the
proceedings against all parties have been concluded.
6. Dutch statutory auditor:
As described in Note 2(a) these consolidated financial
statements are not intended for statutory filing purposes. The Company is
required to file consolidated financial statements prepared in accordance with
The Netherlands Civil Code. During 2019 the Company has been informed by the
audit firm, Baker Tilly (Netherlands) N.V., that they would cancel their
license to audit public interest entities (such as the Company) and that, as a
consequence, they are not in the position to provide the Company with their
audit services for the 2019 statutory annual accounts. As a listed company,
the Company needs to engage a Dutch audit firm that is licensed to perform
audits for public interest entities. The choice for such firms in the
Netherlands is very limited as only six firms have the appropriate license.
NOTE 15:- CONTINGENT LIABILITIES AND COMMITMENTS (Cont.)
Despite extensive effort of the Company to find a new Dutch
auditor, none of those six firms has been found prepared to accept the Company
as their client. The Company approached in writing the Dutch Ministry of
Finance, The Royal Dutch Institute of Chartered Accountants, the Authority for
the Financial Markets to indicate the severe adverse consequences the Company
would suffer if this problem will not be solved but none of those authorities
has been able to find the solution. The Royal Dutch Institute of Chartered
Accountants has put considerable effort in helping the Company by approaching
audit firms and assessing their procedures for client acceptance but has no
legal possibilities at its disposal to force audit firms to accept a specific
client. This leaves the Company in the awkward position of not being able to
meet its obligations regarding the statutory audit.
The Company has proposed to the authorities various
alternative solutions to get the annual accounts of 2019 audited. It appeared
that none of those are legally feasible and none of the addressees came up
with any alternatives. It is now time to emphasize that the Company exhausted
its sources to comply with the requirements of mandatory Dutch law.
Due to the above and in order to avoid an outright
violation of applicable stock exchange regulations, the Company decided to
engage EY Israel to audit its IFRS consolidated annual accounts and to issue
an auditors' report on those statements. The Company submitted the annual
consolidated financial statements as of December 31, 2019, December 31, 2020,
December 31, 2021, December 31, 2022, December 31, 2023 and as of December 31,
2024 which were filed with the London Stock Exchange, the Warsaw Stock
Exchange and the Tel Aviv Stock Exchange, to the Authority for the Financial
Markets and to other relevant Dutch authorities.
As of the date of approval of these consolidated financial
statements the Company still didn't find any solution to have the annual
accounts of 2019, 2020, 2021, 2022, 2023, 2024 and 2025 audited therefore, it
will submit the annual consolidated financial statements as of December 31,
2025 that are filed to the London Stock Exchange, the Warsaw Stock Exchange
and the Tel Aviv Stock Exchange, to the Authority for the Financial Markets
and to any other relevant Dutch authorities.
NOTE 16:- RELATED PARTY TRANSACTIONS
Related party transactions
Transactions between the Company and its subsidiaries have been eliminated on
consolidation and are not disclosed in this note. Details of transactions
between the Group and other related parties are disclosed below.
During the year, Group entities had the following trading transactions with
related parties that are not members of the Group:
Year ended
December 31,
2025 2024
Costs and expenses
Compensation to key management personnel 55 59
Compensation to board members (1) 238 240
The amounts disclosed in the table are the amounts recognised as an expense
during the reporting period related to key management personnel.
(1) 2025 - two board members; 2024 - two board members.
Year ended
December 31,
2025 2024
Other liabilities
Amounts due to directors and key management personnel 40 33
As of December 31, 2025, the Company identified Davidson Kempner Capital
Management LLC ("DK") among the Company's related parties.
DK holds 26.3% of the Company's outstanding shares of the Company as of the
reporting date. DK has no outstanding balance as of the reporting date with
any of the Group companies.
NOTE 17:- DISCLOSURE OF MATERIAL EVENTS AFTER THE REPORTING PERIOD
a. Appointment of the Company's auditor:
On January 15, 2026 the Company announced that, the Board of Directors of the
Company decided to reappoint KOST FORER GABBAY & KASIERER (a member of the
global network of EY firms) as the audit company authorized to audit the
consolidated financial statements of the Company for the year ended December
31, 2025 in order to ensure the reporting requirements and enable the
Company's proper operations.
b. Update regarding arbitrations against Romania with respect to the "Casa
Radio" project:
On January 16, 2026 the Company announced that, regarding the ongoing
arbitration proceedings before the International Centre for the Settlement of
Investment Disputes initiated by the Company in relation to the Casa Radio /
Dâmbovița Center Project in Bucharest, and further to the Company's request
for an update on the expected timing of the Tribunal's award, the Tribunal has
indicated that its award is anticipated to be issued in April 2026.
NOTE 18:- LIST OF GROUP ENTITIES
As of December 31, 2025, the Company owns the following companies (all are
100% held subsidiaries at the end of the reporting period presented unless
otherwise indicated):
Activity Remarks
Romania
Indirectly or jointly owned
Dambovita Center S.R.L. Mixed-use project 75% held by Dambovita Centers Holding B.V.
Casa Radio project
The Netherlands
Directly wholly owned
Plaza Dambovita Complex B.V. Holding company
Plaza Centers Enterprises B.V. Finance company 100% held by Plaza Dambovita Complex B.V.
Mulan B.V. (Fantasy Park Enterprises B.V.) Holding company Holds Fantasy Park subsidiaries in CEE
Plaza Centers Management B.V. Holding company
Dambovita Centers Holding B.V. Holding company 100% held by Plaza Centers N.V.
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Copyright 2019 Regulatory News Service, all rights reservedRecent news on Plaza Centers NV
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