Azrieli Group (AZRG) investor relations material

Executive summary

• Net income rose to NIS 540 million in Q1 2026, up from NIS 457 million in Q1 2025, driven by higher gross profit from residential sales, revaluation of investment property, and improved associate results.

• Revenues from rent, maintenance, and management fees reached NIS 952 million, with consolidated NOI slightly down 1% to NIS 638 million.

• Maintained high occupancy rates: 98% in malls/retail and 97% in offices, with strong visitor traffic as conditions stabilized.

• Significant investments in portfolio expansion, including over NIS 600 million in Israel and European data centers, and a public equity offering of NIS 1.415 billion.

• Continued expansion in data centers, senior housing, and development pipeline, with signed contracts representing potential annual NOI of EUR 278 million.

Financial highlights

• NOI for Q1 2026 was NIS 638 million, down 1% year-over-year; retail NOI declined mainly due to war impact and renovation works.

• FFO excluding senior housing was NIS 395 million, down 9% year-over-year; including senior housing, FFO was NIS 399 million, down 12%.

• Net income rose to NIS 540 million from NIS 457 million in Q1 2025, mainly due to fair value adjustments and associate results.

• Comprehensive income was NIS 495 million, down from NIS 1.126 billion in Q1 2025, impacted by FX translation losses.

• Cash and equivalents stood at NIS 4.0 billion; total assets NIS 65.4 billion.

Outlook and guidance

• Projected NOI and FFO growth driven by development projects and data center expansion, with a pipeline of 10 projects totaling 687,000 sqm.

• Expecting a near-term upswing in mall performance as stability returns, with foot traffic already rebounding.

• Continued focus on long-term value creation, execution, and financial discipline across all segments.

• Management expects to maintain financial flexibility and liquidity despite macroeconomic and geopolitical uncertainties.