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PADICO Holding

PADICO Holding. Investors’ Presentation 2009. Agenda. The Palestinian Economy Overview of PADICO PADICO Financial Statements Future Plans 2010 – 2013. The Palestinian Economy. About Palestine.

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PADICO Holding

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  1. PADICO Holding Investors’ Presentation 2009

  2. Agenda The Palestinian Economy Overview of PADICO PADICO Financial Statements Future Plans 2010 – 2013

  3. The Palestinian Economy

  4. About Palestine The Palestinian Territory landscape is 6,020 sqkm, divided into the West Bank, East Jerusalem (5,655 sqkm) and Gaza Strip (365 sqkm). The Palestinian National Authority governs the West Bank and Gaza Strip. It was established in 1994, pursuant to the Oslo Accords between the PLO and the government of Israel.

  5. GDP Trend The Palestinian Economy’s Key Indicators GDP by Sector Amounts in USD millions • Real GDP growth rate increased by 2% in 2008 compared to 2007 • Estimated growth in 2009 is 6.4% • 2010 real GDP growth is projected to be 7.5%

  6. About PADICO

  7. Who We Are

  8. Our Investment Strategy

  9. PADICO Investments - by sector Risk Management PADICO manages the risk associated with the political and economic environment through: Sector diversification, with the concentration being on sectors characterized as defensive sectors that are associated with infrastructure, real estate and telecommunications. Afinancial portfolio that invests in regional and international equity markets, that is separated from the main operations of the holding company through a subsidiary; Rawan International Investment Co.

  10. A Highlight Of Our Key Investments *Authorized capital in USD millions ** % owned by PADICO ***Holding as of 31-12-2009

  11. Results from some of our key investments Profits 1997 USD 14.3 million Profits 2009 USD 99.2 million Listed Companies 1997 19 Listed Companies 2009 39 Operating Profits 2009 USD 4.8 million Operating Profits 1998 USD (40.4) thousand Total Assets 2009 USD 114 million Total Assets 1997 USD 17.2 million

  12. PADICO Financial Statements

  13. Consolidated Income Statement Summary Net profits increased by 87.5%in 2009 compared to 2008 due to: An increase in operating revenues by 18%, backed by the performance of PPC and consolidated revenues of PRICO. Registration of positive revenues from the investment portfolios compared to a total loss of USD 8.1 million in 2008. The recovery of provision for a loan granted to an associate (PTIC) amounting USD 6.4 million, following the restructuring process.

  14. Revenue Sources Net Profit Revenues & Net Profit Amounts in USD thousand CAGR= 15%

  15. Total Assets ConsolidatedBalance Sheet Summary CAGR = 11% Total Assets increased by 17% in 2009 compared to 2008 due mainly to the consolidation of PRICO which led to increases of around USD 121 million in: Projects in progress Real estate investments Intangible assets

  16. EPS ROA & ROE Profitability Ratios An increase of 89% Amounts in USD

  17. Debt Ratios Capital Structure New Loans were used for expansionary purposes; acquisition of affiliates

  18. Stock Performance USD

  19. Multiples Stock Ratios

  20. Future Plans 2010-2013

  21. Where is PADICO heading in the future?

  22. Merging and acquiring 16 companies into one holding company. • The value of the transaction is USD 95 million • PADICO to own a controlling stake in the new holding. Transaction Summary Real Estate Restructuring Plan Rationale Synergies Status • Cost synergies: • Integration in HR, IT and operations practices; especially in terms of purchases and usage of equipment. • Revenue synergies: • Market and client business integration: • Consolidate PADICO activities in the real estate into one structure • Establish a strong and a leading company in Palestine • The new holding to concentrate on real estate development, management and contracting • Phase one has been completed relating to the due diligence of the related companies in addition to the valuations. • Restructuring of current separate entities is being finalized, in terms of loans repayment and capital reductions. • Business plan is being finalized for the new holding

  23. Consolidating 6 companies into one holding company. • The value of the transaction is USD 9.7 million • PADICO owns a controlling stake in the holding (PIIC). Transaction Summary Manufacturing Sector Restructuring Plan Rationale Synergies Status • Consolidate PADICO activities in the manufacturing sector into one structure • Establish a strong and a leading company in Palestine • The new holding to invest in Oil production, carton, plastics and packaging industry, in addition to Poultry. • Cost synergies: • Integration in HR, IT and operations practices, especially in terms of acquiring raw materials. • Revenue synergies: • Market, client business integration especially in terms of effective distribution. • The holding has acquired most related companies in PADICO Portfolio • The holding to finalize an internal restructuring and add a strong marketing department

  24. Transforming the PSE from a private shareholding company to a public shareholding company • Separate the depository and clearance centre from the trading activities • PADICO to reduce its holdings in the PSE from 76% to around 50% PSE Restructuring Plan Transaction Summary Rationale Status • Corporate governance implementation • Attract strategic international investors into the PSE. • The Government approved the transformation • In the process of marketing the PSE to a strategic investor

  25. Power Generation Sector Overview There is only one Power Generation Plant in Palestine based in the Gaza Strip and provides only 30% of the electricity needs there. In the West Bank, Palestinians import around 2 million MWh/ year from Israel to match the demand. Electricity tariffs are higher than neighboring countries by around 30%. • PADICO will establish a power generation station located in Northern West Bank, with a total capacity of 400 MWh. • The estimated cost will be USD 300 million, USD 120 million will be financed through equity, while the USD 180 million will be debt. • The plant is expected to start operations by end 2012. PADICO Investment

  26. 1.4 million tones of municipal waste is generated every year in the West Bank and Gaza Strip • The average growth in waste generation is estimated at 4% per year, depending on population growth, economic growth and the extent to which people adopt consumer and disposable lifestyles. Solid Waste Sector Overview • PADICO established the first recycling company in Palestine (including the composting) “ The Palestinian Recycling Company”. • The new company's first pilot projects will be building, managing , and operating a recycling facility in Nablus with a total cost of USD 2 million, to start operations mid 2010 PADICO Investment

  27. The average quantity of wastewater in Palestine is over 100 mcmper year • More than 75% of the waste water go into the ground • 80% of the collected wastewater can be retreated and utilized for irrigation. Waste Water Sector Overview • PADICO will be the first private company to enter the water sector in Palestine. • An MOU has been signed with Jenin Municipality to upgrade the wastewater treatment plant. • The project estimated cost is around USD 1- 2 million, and will start operations beginning of 2011. PADICO Investment

  28. Contact Information PADICO Holding Ramallah- Palestine Tel: + 970 2 240 3336 Fax: + 970 2 240 3363 P.O.Box: 1708 Ramallah- Palestine Email: padico_ramallah@padico.com

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