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Brand Industries Group Investor Presentation June 2016

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Page 1: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

Brand Industries Group Investor Presentation June 2016

Page 2: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

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This presentation does not constitute an offer to buy securities of the Company and/or request for proposals to purchase the Company's securities.It should be emphasized that the information outlined is a summary presentation only and not a substitute for a full review of the Company’speriodic reports, quarterly reports and immediate reports and/or other publications published and/or to be published by the Company in electronicdue diligence systems.

The information included in this presentation is based on the present state of the company (including its subsidiaries), its assets, areas of activityand the business environment of the company as it is, to the best knowledge of the Company, as of the preparation and publishing date of thispresentation.

This presentation includes data and information that are based partly on subjective assessments of the company and its estimates, and therefore,they should be treated accordingly. In addition, the presentation includes information regarding the Company's order backlog, the company'svision, its strategy, its goals and plans for the future. The Company's evaluations, estimates and such other information, may constitute forward-looking information as defined in the Securities Law, 5728-1968.

This forward-looking information is based, inter alia, on expectations and estimates by the Company with regard to its present state, areas ofoperations and business environment as they are at the date of this presentation, analysis of general information available to the Company as ofthe date of this presentation and external developments whose realization is uncertain.

Realization of this information may be affected by various factors that cannot be seen or assessed in advance and which are not under theCompany's full control, or not controlled at all, including possible developments in the general Company environment and of external factors thatcould affect the Company's operations. There is no certainty that such information will be realized, in whole or in part, and actual results may differsignificantly from those described in this presentation, due in part to possible changes in the general environment, the Company's business,including regulatory directives relating to the Company's activities and budget plans of any of the Company's customers and/or realization of one ormore of the Company's risk factors as described in Article 25 of Chapter A in the Company's periodic report dated March 28, 2016 (Reference No.2016-01-016734).

Disclaimer

Page 3: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

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About BRAND Industries Group

Leading Israeli solution provider in the Metal Sector for infrastructures, energy and security.

Company customers are the largest industrial and energy companies, public and government security

bodies in Israel.

The group has large scope strategic projects in Israel and abroad.

Offers a wide range of products and services while achieving high synergy between activities.

Service provision includes the fields of engineering and production according to the highest standards and

quality requirements.

Long-term reputation and experience with the highest engineering capabilities and meeting schedules.

Extensive production capacity and nationwide production sites employing 455 workers

Order backlog - NIS 334 million, for execution by Q2 2017 (as of 29 May 2016).

Page 4: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

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Ownership Structure

Controlling interest in the Company is held by the private equity fund KCPS/Kedma

Recruited $75 million

Acquired Control of BRAND

Danel, FIS (acquired by Sapiens),Marina Group, Carmel Winery

Recruiting continuity funding, KedmaFund, in the scope of $150 million

Femi Premium Continuity Software

Gilead Halevy, a partner of the fund is the Company Chairman. Percentage of holdings after private issue.

2007

2008

Additional Investments

2014

KCPS 69.8% 18.3%ציבור

7.9%הפניקס 4%חברת בת Investments

Phoenix 7.9%

Public 18.3%

Subsidiary 4%

Page 5: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

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Entry into the Vehicle Sector,

Acquisition of Activities in the

field of tanks and light constructions.

BRAND Group 40 Years of Experience and Achievement1978

1993

2001

2008

2011

2014

2015

2016

BRAND Founded

Company Share

Issue on Stock

Market

First Sale to

Customer Abroad

KCPS Acquires ControlAcquisition

of Assets

and

Equipment

from the

Koor

Group

Entry into the

Industrial

Facilities

construction

field

Entry into the Natural Gas Project

Page 6: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

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Areas of Activities

Metal and Construction SectorPerformance of projects according to engineering design at a high technical level using advanced technologies.

Power Plants

Construction for Buildings

Gas Aggregator Manufacturing

Pipelines and Plant Conversions

Specialty Vehicle SectorProviding engineering solutions of design, development, manufacture

and maintenance of vehicles tailored to customer needs

For Security Purposes

For Civilian and Military Purposes

For Civilian and Military Purposes

Energy

Infrastructures

Aggregators

Natural Gas

Armored Vehicles

Specialized Vehicles

Trailers & Leaders

Page 7: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

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Achievements

Power plants in Israel and abroad: Dalia, Paz Ashdod, Israel Electric Corporation and in Greece, the U.S., Germany and Belgium

Projects: Production barges and facilities for the Dead Sea Works, construction of a pipeline to Israel Natural Gas Lines

Constructions for Industrial Buildings for Check Point, Ayalon Mall, Adgar 360 Building, Bank Leumi Building

Income in 2015 – NIS 93 Million

Order Backlog (as of 29 May, 2016) – NIS 247 Million

Almost half of the 2015 company income in this sector was received from customers with 8 or more years of seniority

Metal and Construction Sector

Page 8: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

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Major Projects for Execution – 2016

Gilboa Pumped Storage Project

In the scope of NIS 57.5 million, projected completion in Q1 of 2017

Light Rail Red Line Stations Project

In the scope of NIS 72 million, projected completion in Q3, 2017

International Airport at Timna

In the scope of NIS 39 million, projected completion in Q1, 2017

Rutenberg Power Plant, Ashkelon

Construction Project: scope of NIS 24 million, projected completion in H2,

2016

System & equipment manufacture: scope of NIS 40 million, projected

completion in Q4, 2017

Thermo-Solar Power Plant in Ashalim

Scope of NIS 29 million, projected completion by the end of 2016

Metal and Construction Sector

Page 9: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

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(*) Present customers and past customers the Group has performed projects for.

Metal and Construction Sector Customers (*)

Israeli Customers International Customers

Page 10: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

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Achievements

Executing projects abroad in more than seven countries

Both in providing tools for military and civilian purposes

Motorized vehicles for foreign customers – project scope of NIS 100 million, completed in Q2, 2016

Executing projects in Israel for a wide range of customers

Including the IDF, Israel Police, Rafael, Elbit, IMI, the Israel Airport Authority, Israel Fire & Rescue, Israel Nature & Parks Authority and others.

Order Backlog (as of 29 May, 2016) – NIS 87 million

The sales mix is balanced and stable in the domestic market and abroad

Specialty Vehicle Sector

Page 11: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

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Specialty Vehicle Sector Customers

Ministry of Public Security

Page 12: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

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Financial Information

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Page 13: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

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Income Distribution by Activity Sectors in 2015

Metel & Costruction 42% Specialized Vehicle 52% Other 6%

Page 14: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

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Income Distribution by Activity Sectors 1-9/2016

Metel & Costruction 62% Specialized Vehicle 35% other 3%

Page 15: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

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Summary of Consolidated Profit and Loss

Millions of NIS 1-9/2016 2015 2014

Metal & Construction Income 169.4 93.5 147

Designated Vehicles Income 93.5 118.8 86

Gross Profit Rate 18.9% 15.8% 10.7%

Operating Profit 30.7 11.1 6.5

Operating Profit Rate 11.3% 4.8% 2.6%

Net Profit (Loss) 20.3 6.5 (1.5)

Profit (Loss) – stock holders 16.3 0.8 (1.8)

Cash Flow from Operating Activity (29.2) 28.6 11.5

Page 16: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

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Summary of Consolidated Balance Sheet Items

(*) Does not include pledged cash

Millions of NIS 30.9.2016 30.6.2016 31.12.2015

Cash (*) 10.7 17.5 27.1

Accounts Receivable 161.6 136.3 106.3

Inventory 48.9 48.4 45.6

Non-current Assets 87.9 91.1 72.6

Short-term Credit 40.5 23.2 15.1

Consolidated Company Bonds - 19.8 19.1

Accounts Payable 109.8 98.4 90.7

Non-current Liabilities 40.9 36.2 36.8

Equity Capital 114.0 109.6 84.5

Total Balance 318.2 303.3 274.4

Current Ratio 1.41 1.35 1.32

Quick Ratio 1.11 1.04 1.02

Page 17: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

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Growth Engines

Leading large-scale projects as a project manager:Dealing with projects while improving profitability and growth in working shares in projects

Expansion of metal operations in fields benefitting from large-scale investment volumes:Power plants, transportation infrastructure, petrochemicals

Acceleration of construction activities and the strategic positioning of the company as a total solution provider

Strengthening export of specialized vehicles through activity in a number of new territories with a wide range of products

Increasing production capacity, inter alia, in light of the completion of the deal with Koor and the expected increase of the scope of activity in the production of steel assemblies

Strengthening new areas of activity: natural gas delivery infrastructure for natural gas conversion plants, sustainable and solar energy

Expanding strategic partnerships with various companies for the production of armored vehicles to different markets

Page 18: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

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Objectives for 2016 - 2017

Successful implementation of Koor Metal assets, in order to support the expansion of the company's activity

Increasing the number of projects involving the company in both metal and construction, combined

Development of engineering capabilities, allowing the company to bid on complex tenders

Development and production of a range of specialized vehicles according to the requirements of customers in Israel and abroad

Page 19: Brand Industries Group Investor Presentation June 2016 · Brand Industries Group Investor Presentation June 2016. 2 This presentation does not constitute an offer to buy securities

Thank

You