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PLAZACNTR (PLZ): RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2018

UNI - EN REPORT No

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19

/

2018

UNI - EN REPORT No19/2018

RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2018

Plaza Centers N.V. (“Plaza” / “Company” / “Group”) today announces its results for the six months ended 30 June 2018.

Financial highlights:

• Reduction in total assets to €89.7 million as a result of the Company’s deleveraging including principal repayments and the redemption in full of Series of bonds issued in Poland to the amount of €40 million (31 December 2017: €141 million)

• Book value of the Company’s Trading properties at 30 June 2018 was €70.2 million (30 December 2017: €73.6 million) due to a € 3.4 million write-down of Trading properties in Poland, Greece, Romania and Serbia

• Consolidated cash position as at 30 June 2018 (including restricted bank deposits) decreased to €1.2 million (31 December 2017: €44.8 million) and current cash position of circa €1.22 million

• Recorded loss of €9.8 million (30 June 2017: €6.8 million) as no further disposals took place during the period. Losses are mainly due to finance expenses and the write-down of Trading properties

• Basic and diluted loss per share of €1.43 (30 June 2017: loss per share of €0.99)

• Gearing increased to 100.9% (31 December 2017: 94%) mainly due to finance costs and write downs

Material events during the period:

Settlement agreement with the Bondholders:

In January 2018, a settlement agreement was reached and approved (and all the conditions precedent in the agreement fulfilled) between the holders of two Series of Israeli Bonds and the Company regarding the allocation of funds, to be repaid by the Company, across the Israeli Bonds Series. As a result, the Series A Bondholders withdrew their request for immediate repayment.

Retirement of Chief Executive Officer:

On 11 January 2018, the Company announced that the CEO, Dori Keren, would retire from his position at the end of March 2018. The Board of Directors appointed Avi Hakhamov, who has been with the Company for more than 11 years, as Acting CEO commencing 1 April 2018.

Earn-out payment for the sale of Torun:

In June 2018, the Company received the earn-out payment for the sale of Torun Plaza totalling €0.35 million, reduced by NAV adjustment of €0.14 million.

Sale agreement of plot in India:

In January 2018, the Purchaser of the 100% interest in an SPV (in which Plaza holds a 50% stake with its joint venture partner, Elbit Imaging Ltd.), that holds property in Bangalore, India, (the "Agreement" and the "Purchaser" respectively), gave notice that all remaining payments under the Agreement will be stopped until a mutually acceptable solution is reached due to a proposed change (initiated by the Indian authorities) which could potentially impact the development of the land. In February 2018, despite the notice above, the Purchaser paid the January instalment totalling INR 5 Crores (circa €0.65 million).

In March 2018, the Company and the Purchaser signed an amended revised agreement as follows: The Purchaser and EPI agreed that the total purchase price shall be increased to INR 350 Crores (approximately €43.8 million; of which the Company's share is approximately €21.9 million). Following the signing of the revised agreement the Purchaser paid EPI an additional INR 22.5 Crores (approximately €2.8 million; of which the Company's share is approximately €1.4 million) further to the INR 45 Crores (approximately €5.6 million; of which the Company's share is approximately €2.8 million) that was already paid during the previous year.

An additional INR 70.5 Crores (approximately €8.8 million; of which the Company's share is approximately €4.4 million) will be paid by the Purchaser in unequal monthly instalments until the Final Closing. The Final Closing will take place on 31 August 2019 when the final instalment of INR 212 Crores (approximately €26.5 million; of which the Company's share is approximately €13.25 million) will be paid to EPI against the transfer of the outstanding share capital of the SPV.

If the Purchaser defaults before the Final Closing, EPI is entitled to forfeit certain amounts paid by the Purchaser as stipulated in the revised agreement. All other existing Securities granted to EPI under the previous agreements will remain in place until the Final Closing.

Redemption of the Polish Bonds:

In May 2018, further to the decision of the Israeli Series A and Series B Bondholders, the Company redeemed in full the series of bonds issued in Poland at their principal amount together with interest accrued to the maturity date. Upon completion of the redemption, the Company will have no outstanding bonds issued in Poland.

Claim in Greece:

In May 2018, a third party filed a legal claim in the court of Greece against Helios Plaza AE ("HP"), a wholly owned subsidiary of Plaza which holds land property in Athens ("Land Property"). The claimant is pursuing HP for a €2.96 million sum, based on an agreement that is alleged to have been agreed in 2010, and has also filed a request for an injunction with respect to the Land Property in order to secure its claim. In June 2018, the injunction was granted until a final decision regarding the main dispute is reached. At this preliminary stage, the Company and its legal advisors are unable to estimate the probability of the claim and its possible implication, if any.

Due to these new circumstances the sale of the Land Property has been put on hold, and the Company is discussing options with the existing potential buyer.

The Company recorded a write-down of €1.15 million on the property, which reflects expected transaction costs.

Motion to reveal and review internal documents:

In March 2018, a Shareholder of the Company filed a motion with the Financial Department of the District Court in Tel-Aviv to reveal and review internal documents of the Company and of Elbit Imaging Ltd., with respect to the events surrounding certain agreements signed in connection with the Casa Radio Project in Romania and the sale of the US portfolio. Such events were previously announced by the Company and are detailed in notes 8(6) and 27(d) in the annual financial statement as of 31 December 2017. In July 2018, the Company filed a response to the relevant court.

Key highlights since the period end:

Chennai, India:

In July 2018, Elbit Plaza India Real Estate Holdings Limited ("EPI") signed a term sheet with its local partner (the "Buyer"), relating to the sale of EPI's Indian subsidiary ("SPV") that holds 74.7 acre plot in Chennai, India ("Term Sheet"). Under the terms of the Term Sheet, the Buyer shall have 60 days to conduct due diligence only with respect to the SPV, following which definitive agreements, for the sale of the SPV in consideration for INR 110 Crores (approximately €13.75 million; of which the Company's share is approximately €6.8 million) (subject to adjustment with respect to the previous deposit that was placed and the existing cash in the SPV level), shall be signed and closing shall take place on the same day.

A request to reveal documents

An indirect subsidiary of the Group in Romania (which holds a plot of land outside Bucharest) received a request from the Romanian authorities to reveal documents from the period 2007-2011 as part of an ongoing investigation into procedures during those years. The Company is unaware of the subject of the investigation or any illegal acts or irregularities that may have prompted the investigation.

Lodz Centrum Plaza:

In July 2018, a subsidiary of the Company signed a preliminary agreement with respect to the sale of the land plot known as "Lodz Centrum Plaza", for a consideration of PLN 1.3 million. The agreement is conditional upon the pre-emptive right of the municipality of Lodz.

Commenting on the results, acting CEO Avi Hakhamov, said:

“Our active focus has continued to centre on asset disposals and the optimisation of the business with the aim of satisfying our obligations to our stakeholders. This remains our absolute priority for the second of half of the year.”

For further details, please contact:

Plaza

Avi Hakhamov, acting CEO

+ 361 6104523

FTI Consulting

Dido Laurimore / Claire Turvey / Tom Gough

+44 (0)20 3727 1000

Notes to Editors

Plaza Centers N.V. (www.plazacenters.com) is an emerging markets developer of shopping and entertainment centres. The Company is listed on the Main Board of the London Stock Exchange, as of 19 October 2007, on the Warsaw Stock Exchange (LSE: “PLAZ”, WSE: “PLZ/PLAZACNTR”) and, on the Tel Aviv Stock Exchange. Plaza Centers N.V. is an indirect subsidiary of Elbit Imaging Ltd. (“EI”), an Israeli public company whose shares are traded on both the Tel Aviv Stock Exchange in Israel and on the NASDAQ Global Market in the United States.

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. Plaza Centers N.V. has no obligation to update the statements contained in this press release, unless required by law.

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