Elbit Imaging-M Ltd.

Foreign Filer Report • Dec 4, 2017

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 OF THE SECURITIES EXCHANGE ACT OF 1934

For the month of December 2017

Commission File Number 000-28996

ELBIT IMAGING LTD.

(Translation of Registrant's Name into English)

7 MOTA GUR STREET, PETACH TIKVA 4900102 (Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F ☒ Form 40-F ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes☐ No ☒

If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-_

Attached hereto and incorporated by reference herein are the following documents:

• 99.1 Operating and Financial Review and Prospects for the six-month period ended June 30, 2017.
• 99.2 Unaudited Interim Consolidated Financial Data for the six-month period ended June 30, 2017.
• 99.3 Designated Disclosure with Respect to the Company's Projected Cash Flows.

Exhibits 99.1, 99.2 and 99.3 of this Report on Form 6-K are hereby incorporated by reference into Elbit Imaging Ltd.'s Registration Statement on Form F-3 (Registration Statement No. 333-172122) and Registration Statements on Form S-8 (Registration Statements Nos. 333-117509, 333- 130852, 333-136684 and 333-152820) and to be a part thereof from the date on which this report is submitted, to the extent not superseded by documents or reports subsequently filed or furnished.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: December 4, 2017 By: /s/ Ron Hadassi

ELBIT IMAGING LTD. (Registrant)

Ron Hadassi Chairman of the Board

EXHIBIT INDEX

	EXHIBIT NO. DESCRIPTION
99.1.	Operating and Financial Review and Prospects for the six-month period ended June 30, 2017.
99.2.	Unaudited Interim Consolidated Financial Data for the six-month period ended June 30, 2017.
99.3	Designated Disclosure with Respect to the Company's Projected Cash Flows
	4

Operating and Financial Review and Prospects

The activities of Elbit Imaging Ltd. ("Elbit" or the "Company") are divided into the following principal fields: (i) Commercial Centers - initiation, construction and sale of commercial centers and other mixed-use real property projects, predominantly in the retail sector, located in Central and Eastern Europe, primarily through our 45% subsidiary Plaza Centers N.V. ("PC); in certain circumstances and depending on market conditions, we operate and manage commercial centers prior to their sale; (ii) Hotel - hotel operation and management; (iii) Medical Industries - (a) research and development, production and marketing of magnetic resonance imaging guided focused ultrasound treatment equipment and (b) development of stem cell population expansion technologies and stem cell therapy products for transplantation and regenerative medicine; and (iv) Plots in India - plots designated for sale which were initially designated to residential projects

We may from time to time make written or oral forward-looking statements, including in filings with the U.S. Securities and Exchange Commission ("SEC"), in reports to shareholders, press releases and investor webcasts. Forward-looking statements include statements regarding the intent, belief or current expectations of Elbit and our management about our business, financial condition, results of operations, and our relationship with our employees and the condition of our properties. Words such as "believe", "expect," "intend", "estimate" and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. Actual results may differ materially from those projected, expressed or implied in the forward-looking statements as a result of various factors including, without limitation, the factors set forth in our filings with the SEC including, without limitation, Item 3.D of our Annual Report on Form 20-F for the fiscal year ended December 31, 2016, under the caption "Risk Factors". Any forward-looking statements speak only as of the date of such statement, and we caution existing and prospective investors not to place undue reliance on such statements. Such forward-looking statements do not purport to be predictions of future events or circumstances, and therefore, there can be no assurance that any forward-looking statement will prove to be accurate. We undertake no obligation to update or revise any forward-looking statements.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the unaudited interim consolidated financial data for the period ended June 30, 2017 included elsewhere in this Current Report on Form 6-K and in conjunction with our consolidated financial statements and the related notes and other financial information included in our Annual Report on Form F-20 submitted to the SEC on November 13, 2017.

Six months ended June 30, 2017 compared to corresponding period in 2016

Consolidated income and revenues for the six months' period ended June 30, 2017 amounted to NIS 513 million (\$147 million) compared to NIS 219 million in the corresponding period in 2016. Following is the analyses of our revenues:

• (i) Revenues from sale of commercial centers increased in the first half of 2017 to NIS 432 million (\$124 million) compared to NIS 116 million in the corresponding period. Such amount in 2017 was attributable mainly to the sale of Suwalki Plaza commercial center in Poland, the sale of Belgrade Plaza commercial center in Servia and sale of plots in Bulgaria and Poland.. The revenues in 2016 are attributed mainly to the sale of Liberce Plaza commercial centers in Czech Republic and the sale of plots in Belgrade, Romania and Poland by PC.
• (ii) Revenues from hotel operations and management amounted to NIS 63 million (\$18 million) in the first half of 2017 compared to NIS 67 million in the corresponding period. The decrease was mainly attributable to devaluation of the Israeli NIS against the Romanian LEI in approximately 10% offset by an increase in the revenue of the Radisson Blu Hotel in Bucharest Romania. The average occupancy rate in our hotels was approximately 79.9% in 2017 compared to 78% in 2016, and the average room rate was approximately €91.8 in 2017 compared to €93 and in 2016. Our Radison hotel in Bucharest, Romania consist approximately of 763 rooms in 2017 and 2016.

(iii) Rental income from commercial centers amounted to NIS 18 million (\$5 million) in the first half of 2017 compared to NIS 36 million in the corresponding period. The decrease was mainly as a result of selling the Liberece Plaza commercial center in March 2016, the sale to the bank of the Zgorzelec Plaza commercial center in September 2016 and the sale of Suwalki Plaza commercial center in February, 2017. The average occupancy rates in 2017 were 93.49% compared to 89%-98% in 2016. PC's business model in respect of its commercial centers is to develop, lease and then sell the properties to third parties. Therefore, the rental income from the commercial centers in the first half of 2017 and 2016 represented only the lease income from the commercial centers and may not be sustainable in the future once PC sells the commercial centers as part of its business cycle.

Expenses and losses (income):

Our expenses and losses in 2017 amounted to NIS 590 million (\$169 million) compared to NIS 315 million in the corresponding period in 2016. Set forth below is an analysis of our expenses and losses:

• (i) Cost of hotel operations and management amounted to NIS 52 million (\$15 million) in the first half year of 2017 compared to NIS 58 million in the corresponding period. The decrease was mainly attributable to devaluation of the Israeli NIS against the Romanian LEI in approximately 10%.
• (ii) Expenses of commercial centers amounted to NIS 436 million (\$125 million) in the first half of 2017 compared to NIS 130 million in the corresponding period in 2016. The increase was mainly attributable to (i) increase in the amount on NIS 310 million in the cost of trading property sold. Off set in (ii) decrease in operational expenses of commercial centers in the amount of NIS 4 million mainly due to the sale Liberece Plaza and Zgorzelec Plaza commercial centers during 2016 and the Suwalki Plaza commercial center in 2017.
• (iii) General and administrative expenses increased to NIS 8 million (\$2 million) in the first half of 2017 compared to NIS 5 million in the corresponding period in 2016. The increase was mainly attributable to cost related to additional cost incurred by the Company due to the delay in filling of the Company's annual financial statements and the replacement of accountants.
• (iv) Share in losses of associated net amounted to NIS 14 million (\$4 million) in the first half of 2017 compared to NIS 21 million in the corresponding period. Such losses were mainly attributable to losses of Gamida which is an associate of the Company.
• (v) Financial expenses, net amounted to NIS 80 million (\$23 million) in the first half of 2017 compared to NIS 84 million in the corresponding period in 2016. The decrease of NIS 4 million related mainly to the following:
  • · A decrease in the amount of NIS 21 million (\$6 million) in interest and CPI linked borrowing expenses, net, attributable mainly due to cancellation of acceleration of discount amortization in PC's notes due to changes in the PC forecast cash flow. Off set by:
  • · An increase in the amount of NIS 18 million (\$5 million) in exchange rate differences mainly attributable to exchange rate differences between the Euro and NIS on PC's notes, which are denominated in NIS and are measured in Euro..
• (vi) Write-down, charges and other expenses, net, amounted to income in the amount of NIS 0.5 million (\$0.1 million) in the first half of 2017 compared to expenses in the amount of NIS 16 in the corresponding period in 2016. The amounts in the first half of 2016 include mainly provision in the amount of €2 million (NIS 9 million) as result of arbitration ruling against PC in indemnification claim and loss in the amount of NIS 8 due to termination of lease agreement regarding land plot near Tiberius, Israel.

(vii) As a result of the foregoing factors, we recognized loss before income tax in the total amount of NIS 78 million (\$22 million) in the first half of 2017 compared to NIS 96 million in the corresponding period in 2016.

Tax benefits amounted to NIS 2 million (\$0.6million) in the first half of 2017 compared to income tax expenses in the amount of NIS 1 million in the corresponding period in 2016.

The above resulted in loss of NIS 75 million (\$22 million) in the first half of 2017, of which NIS 59 million (\$17 million) was attributable to our equity holders and loss in the amount of NIS 17 million (\$5 million) was attributable to the non-controlling interest. The loss in the first half of 2016 amounted to NIS 97 million of which NIS 79 million was attributable to our equity holders and loss in the amount of NIS 17 million was attributable to the non-controlling interest.

(viii) The following table provides supplemental information of our results of operations per segment, for the first half year ended June 30, 2017 (in NIS millions):

Segment	Hotels	Commercial Centers	Medical Industries	Residential	Other and Allocations*	Total
Revenues	63	432	40	-	(40)	495
Rental income from commercial centers	-	18	-	-	-	18
Costs and expenses	52	436	52	-	(52)	488
Financial expenses (income), net	9	4	-	-	-	13
Other expenses, net	-	-	-	1	(1)	-
Share in losses of associates, net	-	-	9	-	5	14
Segment profit (loss)	2	10	(21)	(1)	8	(2)
Unallocated general and administrative						(8)
expenses
Unallocated financial expenses						(68)
Unallocated other income						1
Profit before income taxes						(77)
Income Tax						2
Profit from discontinued operation						(75)
Loss for the period						(75)

ELBIT IMAGING LTD. INTERIM CONSOLIDATED FINANCIAL DATA AS OF JUNE 30, 2017

INDEX

	Page
Interim Consolidated Balance Sheet	2
Interim Consolidated Income Statements	3
Interim Consolidated Comprehensive Income Statements	4
Interim Statement of Changes in Shareholders' Equity	5-6
Interim Consolidated Statements of Cash Flows	7-9
Notes to the condensed consolidated interim financial statements	10-21

ELBIT IMAGING LTD. INTERIM CONSOLIDATED BALANCE SHEETS

	June 30,	December 31,	June 30, 2 0 1 7 Convenience translation US\$'000
	2 0 1 7	2 0 1 6
		(in NIS thousands)
Current Assets
Cash and cash equivalents	85,715	89,688	24,518
Short-term deposits and investments	19,170	39,527	5,483
Trade accounts receivables	66,559	34,168	19,038
Other receivables	8,890	13,344	2,543
Inventories	1,898	1,865	543
	182,232	178,592	52,125
Non-Current Assets
Trading property	885,771	1,310,549	253,367
Deposits and other long-term balances	17,936	23,484	5,130
Investments in equity method investees	11,215	26,949	3,208
Property, plant and equipment, net	675,331	721,635	193,173
	1,590,253	2,082,617	454,878
	1,772,485	2,261,209	507,003
Current Liabilities
Short-term credits	1,625,694	1,128,768	465,016
Suppliers and service providers	8,177	34,160	2,339
Payables and other credit balances	43,850	46,699	12,543
	1,677,721	1,209,627	479,898
Non-Current liabilities
Borrowings		- 852,870	-
Other liabilities	61,748	57,155	17,662
Deferred taxes	87,933	92,942	25,152
	149,681	1,002,967	42,814
Shareholders' Equity (Deficiency)
Attributable to equity holders of the Company	(169,140)	(88,489)	(48,381)
Non-controlling Interests	114,223	137,103	32,672
	(54,917)	48,614	(15,709)
	1,772,485	2,261,209	507,003

The accompanying notes form an integral part of the interim financial data.

ELBIT IMAGING LTD. INTERIM CONSOLIDATED INCOME STATEMENTS

	Six months ended June 30,		Year ended December 31,	Six months ended June 30,
	2 0 1 7	2 0 1 6	2 0 1 6	2 0 1 7
		(in NIS thousands)		Convenience Translation US\$'000
Income revenues and gains
Revenues
Revenues from sale of trading properties	431,973	115,865	126,019	123,562
Revenues from hotel operation and management	62,664	67,282	135,839	17,924
Total revenues	494,637	183,147	261,858	141,486
Gains and other
Rental income from commercial centers	18,052	36,228	66,417	5,164
Total income revenues and gains	512,689	219,375	328,275	146,650
Expenses and losses
Hotel operation and management	52,377	57,753	115,367	14,982
Cost of trading properties sold and commercial centers operation	436,542	129,987	159,806	124,868
General and administrative expenses	8,260	4,750	10,257	2,363
Share in losses of associates, net	14,053	21,344	54,313	4,020
Financial expenses	79,565	84,709	142,337	22,759
Write down, charges and other expenses(income), net	(456)	16,505	155,357	(130)
	590,341	315,048	637,437	168,862
Loss before tax benefits	(77,652)	(95,673)	(309,162)	(22,212)
Income tax expenses (tax benefits)	(2,239)	917	2,906	(641)
Loss for the period	(75,413)	(96,590)	(312,068)	(21,571)
Attributable to:
Equity holders of the Company	(58,745)	(79,329)	(194,830)	(16,803)
Non-controlling interest	(16,668)	(17,261)	(117,238)	(4,768)
	(75,413)	(96,590)	(312,068)	(21,571)
Loss per share Basic and diluted per share:
	(6.39)	(8.63)	(21.20)	(1.83)

The accompanying notes form an integral part of the interim financial data.

ELBIT IMAGING LTD. INTERIM CONSOLIDATED OTHER COMPREHENSIVE INCOME STATEMENT

	Six months ended June 30,		Year ended December 31,	Six months ended June 30,
	2 0 1 7	2 0 1 6	2 0 1 6	2 0 1 7
	(in NIS thousands)	Convenience Translation US\$'000
Loss for the period	(75,413)	(96,590)	(312,068)	(21,571)
Other comprehensive income (loss) to be reclassified to profit or loss in subsequent periods:
Exchange differences arising from translation of foreign operations	(18,498)	(163)	(33,933)	(5,291)
Gain (loss) from cash flow hedge	-	(1,248)	1,670	-
	(18,498)	(1,411)	(32,263)	(5,291)
Items not to be reclassified to profit or loss in subsequent periods:
Revaluations of property plant and equipment	(9,999)	14,249	90,410	(2,860)
Other comprehensive income (loss)	(28,497)	12,838	58,147	(8,151)
Comprehensive loss	(103,910)	(83,752)	(253,921)	(29,722)
Attributable to:
Equity holders of the Company	(84,215)	(66,486)	(128,114)	(24,089)
Non-controlling interests	(19,695)	(17,266)	(125,807)	(5,633)
	(103,910)	(83,752)	(253,921)	(29,722)

The accompanying notes form an integral part of the interim financial data.

ELBIT IMAGING LTD. INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

	Share capital and share premium	Other reserves (*)	Revaluation of property, plant and equipment	Stock-based compensation reserve	Foreign currency translation reserve	Retained earnings	Gross amount	Non Controlling interest	Total shareholders' equity
					(In thousand NIS)
Balance - January 1, 2016	1,105,974	(341,907)	228,745		- (748,892)	(224,633)	19,287	284,777	304,064
Loss for the year		-	-	-	-	- (194,830)	(194,830)	(117,238)	(312,068)
Other comprehensive income (loss)		- 2,015	76,025		- (24,089)	12,765	66,716	(8,569)	58,147
Stock based compensation expenses		-	-	- 27		-	- 27	149	176
Transaction with non-controlling interest		- 40,903		-	- (27,369)		- 13,534	(15,239)	(1,705)
Cancelation of stock based compassion	-	6,777		-	-	-	- 6,777	(6,777)	-
Balance - December 31, 2016	1,105,974	(292,212)	304,770		27 (800,350)	(406,698)	(88,489)	137,103	48,614
Loss for the period		-	-	-	-	- (58,745)	(58,745)	(16,668)	(75,413)
Other comprehensive income (loss)		-	- (15,492)		- (15,658)	5,680	(25,470)	(3,027)	(28,497)
Stock based compensation expenses		-	-	- 30		-	- 30	349	379
Transaction with non-controlling interest		- 670		-	-	-	- 670	(670)	-
Cancelation of stock based compassion	-	2,864		-	-	-	- 2,864	(2,864)	-
Balance - June 30, 2017	1,105,974	(288,678)	289,278		57 (816,008)	(459,763)	(169,140)	114,223	(54,917)

(*) includes transactions with non-controlling interest reserve and hedging reserve.

The accompanying notes form an integral part of the interim financial data.

ELBIT IMAGING LTD. INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (CONT.)

	Share capital and Share premium	Other reserves (*)	Revaluation of property, plant and equipment	Stock-based compensation reserve	Foreign currency translation reserve (In thousand US\$)	Retained earnings	Gross amount	Non Controlling interest	Total shareholders' equity
Balance - December 31, 2016	316,354	(83,585)	87,177		8 (228,933)	(116,332)	(25,311)	39,217	13,906
Profit (loss) for the period Other comprehensive income		-	-	-	-	- (16,803)	(16,803)	(4,768)	(21,571)
(loss)		-	- (4,430)		- (4,480)	1,624	(7,286)	(865)	(8,151)
Stock based compensation expenses		-	-	-	8	-	-	8 99	107
Transaction with non-controlling interest		- 192		-	-	-	- 192	(192)	-
Cancelation of stock based compassion	-	819		-	-	-	- 819	(819)	-
Balance - June 30, 2017	316,354	(82,574)	82,747		16 (233,413)	(131,511)	(48,381)	32,672	(15,709)

(*) includes transactions with non-controlling interest reserve and hedging reserve.

The accompanying notes form an integral part of the interim financial data.

ELBIT IMAGING LTD. INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS

	Six months ended June 30,		Year ended December 31,	Six months ended June 30, 2 0 1 7
	2 0 1 7 2 0 1 6		2 0 1 6
		(in NIS thousands)		Convenience Translation US\$'000
CASH FLOWS FROM OPERATING ACTIVITIES
Loss for the period from continuing operations	(75,413)	(96,590)	(312,068)	(21,571)
Tax expenses(benefits) recognized in profit and loss	(2,239)	917	2,906	(641)
Income tax paid in cash	(40)	(125)	(803)	(11)
Finance expenses recognized in profit and loss	79,565	84,709	142,337	22,759
Depreciation and amortization (including write-down and impairment)	16,597	18,059	196,141	4,747
Share in losses of associates, net	14,053	21,344	54,313	4,020
Loss (Profit) from realization of assets and liabilities	(2,226)	8,174	(7,973)	(637)
Stock based compensation expenses	379	58	189	109
Others	-	64	(412)	-
Change in trade accounts receivables	5,676	(357)	(22,797)	1,624
Change in receivables and other debit balances	11,332	(24,353)	61	3,241
Change in Inventories	(66)	56	106	(19)
Change in trading property and payment on account of trading property	166,639	70,314	18,708	47,665
Change in suppliers and service providers	66	9,780	20,929	19
Change in payables and other credit balances	5,650	(545)	(14,607)	1,616
Net cash provided by operating activities	219,973	91,505	77,030	62,921

The accompanying notes form an integral part of the interim financial data.

ELBIT IMAGING LTD. INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS (Cont.)

	Six months ended June 30,		Year ended December 31,	Six months ended June 30,
	2 0 1 7	2 0 1 6	2 0 1 6	2 0 1 7 Convenience translation
		(in NIS thousands)		US\$'000
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from realization of investments in subsidiaries (Appendix A)	15,055		-	- 4,306
Purchase of property plant and equipment, investment property and other
assets	(2,354)	(1,359)	(2,872)	(673)
Proceeds from realization of property plant and equipment	422	145	22,278	121
Proceeds from sale of investments in a joint venture company	869		- 83,792	249
Investment in long-term deposits and long-term loans	(1,635)	(14,230)	(10,851)	(468)
Proceed from realization of long-term deposits and long-term loans	13,021	18,492	7,128	3,724
Interest received in cash	184	129	328	53
Change in short-term deposits and marketable securities, net and changes in restricted cash	-	(8,311)	(9,917)	-
Net cash provided by (used in) investing activities	25,562	(5,134)	89,886	7,312
CASH FLOWS FROM FINANCING ACTIVITIES:
Purchase of non-controlling interest	-	(499)	(701)	-
Interest paid in cash	(41,896)	(56,561)	(107,297)	(11,984)
Proceeds from long-term borrowings	15,974	98,897	204,615	4,569
Repayment of long-term borrowings	(221,643)	(140,709)	(332,553)	(63,399)
Proceeds from selling (purchasing) of derivatives	-	2,197	2,677	-
Net cash used in continued financing activities	(247,565)	(96,675)	(233,259)	(70,814)
Net cash used in financing activities	(247,565)	(96,675)	(233,259)	(70,814)
Decrease in cash and cash equivalents	(2,030)	(10,304)	(66,343)	(581)
Cash and cash equivalents at the beginning of the year	89,688	157,851	157,851	25,654
Net effect on cash due to currency exchange rate changes	(1,943)	619	(1,820)	(555)
Cash and cash equivalents at the end of the period	85,715	148,166	89,688	24,518

The accompanying notes form an integral part of the interim financial data.

ELBIT IMAGING LTD. INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS (Cont.)

	Six months ended June 30,		Year ended December 31, 2 0 1 6	Six months ended June 30, 2 0 1 7
	2 0 1 7 2 0 1 6
	(in NIS thousands)			Convenience translation US\$'000
Appendix A - Proceeds from realization of investments in subsidiaries
Working capital (excluding cash), net	3,794		-	- 1,085
Property, plant equipment and other assets	9,035		-	- 2,584
Profit from realization of subsidiaries	2,226		-	- 637
	15,055		-	- 4,306

The accompanying notes form an integral part of the interim financial data.

1. Reporting entity:

• A. Elbit Imaging Ltd. ("Elbit" or "the Company") was incorporated in 1996 under the laws of the State of Israel. The Company's securities are listed on the NASDAQ Global Select Market (ticker symbol: EMITF) and on the Tel Aviv Stock Exchange ("TASE"). Its executive offices are located at 7 Motta Gur Str., Petach Tikva Israel
• B. The activities of the Company and its held entities (the "Group") are divided into the following principal fields: (i) Commercial Centers - initiation, construction and sale of commercial centers and other mixed-use real property projects, predominantly in the retail sector, located in Central and Eastern Europe, primarily through its 45% subsidiary Plaza Centers N.V. In certain circumstances and depending on market conditions, the Group operate and manage commercial and entertainment centers prior to their sale; (ii) Hotel - hotel operation and management (refer also to Note 9 I); (iii) Medical Industries and devices - (a) research and development, production and marketing of magnetic resonance imaging guided focused ultrasound treatment equipment and (b) development of stem cell population expansion technologies and stem cell therapy products for transplantation and regenerative medicine; (iv) Plots in India - plots designated for sale initially designated to residential projects.

2. Statement of compliance

This condensed consolidated interim financial information has been prepared in accordance with IAS 34 Interim Financial Reporting. The condensed consolidated interim financial information does not include all of the information required for full annual financial statements, and should be read in conjunction with the annual consolidated financial statements of the Group for the year ended December 31, 2016.

The condensed consolidated interim financial information was approved for issue by the Company's board of directors on December 3, 2017.

Rates of exchange of NIS, in effect, in relation to foreign currency (in NIS) are as follows:

	Half year ended June 30, 2017	Year ended December 31, 2016
US Dollar (\$)	3.496	3.902
Euro (€)	3.986	4.247
Romanian New Lei (RON)	0.8753	0.938
Indian Rupee (INR)	0.0539	0.058

Scope of change in the exchange rate, in effect, of the NIS in relation to the foreign currencies (%):

	Half year ended June 30, 2017	Year ended December 31, 2016
US Dollar (\$)	(9)	(1)
Euro (€)	(1)	(5)
Romanian New Lei (RON)	(2)	(5)
Indian Rupee (INR)	(5)	(4)

3. Significant accounting policies

The accounting policies applied by the Group in this condensed interim financial information are the same as those applied by the Group in its latest annual consolidated financial statements as of December 31, 2016.

New standards prior to their adoption:

Amendments to IAS 7 Statement of Cash Flows: Disclosure Initiative

The amendments require entities to provide disclosures about changes in their liabilities arising from financing activities, including both changes arising from cash flows and non-cash changes (such as foreign exchange gains or losses). On initial application of the amendment, entities are not required to provide comparative information for preceding periods. The Group is not required to provide additional disclosures in its condensed interim consolidated financial statements, but will disclose additional information in its annual consolidated financial statements for the year ended 31 December 2017.

Amendments to IAS 12 Income Taxes: Recognition of Deferred Tax Assets for Unrecognised Losses

The amendments clarify that an entity needs to consider whether tax law restricts the sources of taxable profits against which it may make deductions on the reversal of that deductible temporary difference. Furthermore, the amendments provide guidance on how an entity should determine future taxable profits and explain the circumstances in which taxable profit may include the recovery of some assets for more than their carrying amount.

Entities are required to apply the amendments retrospectively. However, on initial application of the amendments, the change in the opening equity of the earliest comparative period may be recognized in opening retained earnings (or in another component of equity, as appropriate), without allocating the change between opening retained earnings and other components of equity. Entities applying this relief must disclose that fact.

The Company is yet to evaluate the effect of IAS 12 on the consolidated financial statements

IFRIC 23, Uncertainty over Income Tax Treatments:

In June 2017, the International Accounting Standards Board issued IFRIC 23, Uncertainty over Income Tax Treatments. IFRIC 23 is to be applied while performing the determination of taxable profit (or loss), tax bases, unused tax losses, unused tax credits and tax rates, when there is uncertainty over income tax treatments under IAS 12. According to IFRIC 23, companies need to determine the probability of the relevant tax authority accepting each tax treatment, or group of tax treatments, that the companies have used or plan to use in their income tax filing which has to be considered to compute the most likely amount or the expected value of the tax treatment when determining taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates.

The effective date for adoption of IFRC 23 is annual periods beginning on or after January 1, 2019, though early adoption is permitted.

The Company is yet to evaluate the effect of IFRIC 23 on the consolidated financial statements.

4. The Company financial position:

As of the financial statements' approval date, the Company's standalone financial position includes liabilities to bank Hapoalim and towards Series H and Series I notes in the aggregate principal amount of approximately NIS 618 million. An amount of approximately NIS 48 million (principal plus future accrued interest) is due to bank Hapoalim on January 31, 2018 and an amount of approximately NIS 312 million (principal plus future accrued interest) is due to Series H notes until May 30, 2018. The remaining amount of approximately NIS 318 million (principal plus future accrued interest) will become due until November 2019. In addition, until May 2018 the Company has certain operational expenses and other current liabilities for its ongoing operations in the amount of approximately NIS 12 million.

The Company has prepared a projected cash flow that outlines the relevant resources until May 2018 that are expected to serve the repayments to bank Hapoalim and Series H notes which includes the following resources : (i) cash and cash equivalents (on a standalone basis) of approximately NIS 16 million; (ii) net cash expected to be generated from the withdrawal of the net operational profits and the sale of the Company's holdings in Radisson hotel in Bucharest of approximately NIS 301 million (See note 9 I); (iii) proceeds from advance payments on account of the sale of our plot in Bangalore (India) in the amount of approximately NIS 17 million based on terms of the sale purchase agreement signed in July 2017( see note 8 I);(iv) proceeds from partial sale of our shares in Elbit Medical in the amount of approximately NIS 50-60 million.

In addition, the Company has additional resources, of approximately NIS 378 million which include, inter alia: (i) the remaining holdings of the Company in Elbit Medical including shares and shareholder loan of the Company to Elbit Medical in the amount on NIS 154 million which is due on January 1, 2019;(ii) additional proceeds from the sale of our plot in Bangalore (India); and (iii) excepted proceed from our plot in Chennai (India).

These resources are designated to serve the repayment to Series I notes in the amount of NIS 318 million which is due in November 30 2019.

The Company's management and board of directors are of the opinion, based on the projected cash flow and the assumptions described, that the Company can execute its plans and that it would be able to serve its indebtedness in the foreseeable future.

In light of the foregoing, the Company's management and board of directors are of the opinion that no significant doubts exist as to the Company's ability to act as going concern and hence, the consolidated financial statements of the Company as of June 30, 2017 were prepared based on going concern assumption.

5. Going concern and liquidity position of PC:

As at June 30, 2017 the PC's outstanding obligations to bondholders and banks are EUR 140.1 million and circa EUR 44 million, respectively.

In November 2016, PC agreed with its bondholders to amend the terms of the early repayment requirement under the original debt restructuring plan (the "Restructuring Plan"). On March 15, 2017, PC repaid the required minimum early repayment to its bondholders and thus obtained a deferral of one year for the remaining contractual obligations of the bonds.

5. Going concern and liquidity position of PC: (Cont.)

Information concerning the PC's obligations and commitments to make future payments under contracts such as debt agreements in the 15 months starting October 1, 2017 is aggregated in the following tables.

		Total Payment Due by period (in TEUR)
Contractual Obligations	Within 1 year	0.25 year
Bonds including current portion and interest	52,000(*)	10,700
Secured bank loan (Torun)	43,596	-
Total contractual obligations (excluding working capital)	95,596	26,300
General & administrative	3,400	600

(*) Excluding an amount of circa EUR 7.25 million which was not repaid on October 30, 2017 by the approval date of these interim consolidated financial statements following the balance sheet date as a result of dispute (refer to Note 9(d)).

PC expects to increase the amount of its liquid balances during the 15 months starting October 1, 2017, by means of the following actions:

• Sale of shopping centers in amount of EUR 38.4 million (net of bank loan)
• Sale of plots of lands in amount of EUR 25.6 million

PC'S management expects that PC will be able to meet the remaining contractual obligations during the 15 months period starting October 1, 2017 by its assets disposal program.

PC's Management acknowledges that the above expected cash flows are based on forward-looking plans and estimations which rely on the information known to management at the time of the approval of these financial statements. The materialization of the above forecast is not certain and are subject to factors beyond the Company's control. Therefore, delays in the realization of the Group's assets and investments or realization at lower price than expected by management, could have an adverse effect on the Group's liquidity position and its ability to meet its contractual obligations on a timely manner.

PC's Management further acknowledges that the company is exposed to foreign currency risk derived from borrowings denominated in currency other than the functional currency of the group, more specifically, a further devaluation of the EUR against the NIS can significantly increase the remaining contractual obligation to bondholders.

As of June 30, 2017 PC is not in compliance with Coverage Ratio Covenant ("CRC") as defined in the restructuring plan. This may entitle the bondholders to declare that all or a part of their respective (remaining) claims become immediately due and payable. It is important to mention that taking into account the contingent considerations based on signed SPAs, the CRC might be higher than the minimum ratio required.

In addition, based on trust deeds in case of material deterioration in the PC's business and substantial suspicion exists that PC will not be able to repay the bonds on time, the bondholders may declare immediate repayment of bonds. In addition, should the bondholders exercise their right to declare immediate repayment, there is a cross default trigger in PC's bank loan agreements that would allow the banks to demand repayment of the loans made.

5. Going concern and liquidity position of PC: (Cont.)

PC's financial statements as of December 31, 2016 include an auditor's opinion with emphasis of matter to going concern uncertainty as well as auditor's review report with respect financial statements as for June 30, 2017. As a result, there is a risk that the bondholders could argue that there exists a substantial suspicion with respect to the PC's ability to repay its obligations that entitles them to immediate repayment. Should this occur there is a risk that the bank with whom PC has loan in place will also demand immediate repayment of the loans made to the Company.

PC did not publish its financial statements within the deadline set out in the bond trust deeds and has not remedied the situation within the allowed time. In addition, the trading of the PC's ordinary shares, Series A Notes and Series B Notes have been temporarily suspended from trading on the relevant exchanges. This may entitle the bondholders to declare that all or a part of their respective (remaining) claims become immediately due and payable.

As a result PC bonds and bank loans were classified as current liabilities in the financial statements as of June 30, 2017.

In the case that the bondholders would declare their remaining claims to become immediately due and payable, PC 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. As at the date of these financial statements the bondholders have not taken steps to assert their rights.

A combination of the abovementioned conditions indicates the existence of a material uncertainty that casts significant doubt about PC's ability to continue as a going concern.

6. Segment reporting

The chief operating decision-makers (CODM) have been identified as the Chairman of the board CEO and the Acting CEO and CFO. The CODM reviews the Group's internal reporting in order to assess performance and allocate resources. The CODM assess the performance of the Group's segments based on Net Operating Income.

For the purpose of this interim financial information the following business segments were identified:

• Commercial Centers
• Hotel
• Medical industries
• Plots in India

6. Segment reporting (Cont.)

Six months period ended June 30, 2017:

	Commercial and entertainment centers	Hotels	Medical industries (i) (Unaudited)	Plots in India ( I n t h o u s a n d N I S)	Equity method adjustment	Total
Segment revenues	450,025	62,664	39,817		(39,817) -	512,689
Segment profit (loss)	14,028	10,626	(12,158)	(835)	12,565	24,226
Financial expenses	(3,513)	(8,907)	-		- -	(12,420)
Share in losses of associates, net	-		(9,106) -	-	(4,947)	(14,053)
Unallocated general and administrative expenses Unallocated other income						(8,260) -
Unallocated financial expenses						(67,145)
Loss before income taxes						(77,652)

(i) Includes mainly investments in associates and therefore not included in the total revenues and other income.

6. Segment reporting (Cont.)

Six months period ended June 30, 2016:

	Commercial and entertainment centers	Hotels	Medical industries (i) (in thousand NIS)	Residential	Equity method adjustment	Total
			(Unaudited)
Segment revenues	164,617	67,282	28,955		(41,479) -	219,375
Segment profit (loss)	18,729	1,793	(57,729)	(924)	51,825	13,694
Financial expenses	1,937	(10,196)	-		-	(8,259) -
Share in losses of associates, net	-		(3,239) -	-	(18,105)	(21,344)
Unallocated general and administrative expenses						(4,750)
Unallocated other income						830
Unallocated financial expenses Loss before income taxes						(75,845) (95,673)

(i) Includes mainly investments in associates and therefore not included in the total revenues and other income.

6. Segment reporting (Cont.)

Year ended December 31, 2016:

	Commercial Centers (i)	Hotel	Medical industries and devices	Plots in India	Other activities and allocations	Equity method adjustments	Total
				(in thousand NIS)
Revenues	210,014	135,839	96,333		-	- (113,911)	328,275
Segment profit (loss)	(135,061)	27,433	(119,689)	9,354		- 116,361	(101,602)
Financial income (expenses)	60,454	(19,634)	-		-	-	40,820
Share in losses of associates, net	-		(7,960) -	-		- (46,352)	((54,312
Adjustments:
Unallocated general and administrative expenses							(10,257)
Unallocated other expenses							(655)
Unallocated financial expenses							(184,807)
Financial income							(1,056)
Change in fair value of financial instruments measured at FVTPL							2,707
Loss before income taxes							(309,162)
Income taxes							(2,906)
Profit from continuing
operations							(312,068)
Profit from discontinued operation							-
Loss for the year							(312,068)

(i) Includes mainly revenues from commercial centers under operation until their sale and consideration from sales of trading property

7. Financial instruments

A. Financial risks:

During the six-months period ended June 30, 2017there have been no significant changes in the Group's financial risk management. Objectives and policies are consistent with those disclosed in note 21.C to the consolidated financial statements as at and for the year ended December 31, 2016.

B. Fair value of financial instruments:

1) The following table presents the book value and fair value of the Group's financial assets (liabilities), which are presented in the financial statements at other than their fair value:

		June 30, 2017
		Book Value	Fair Value
	Level	(In thousands NIS)
Debentures*)	Level 1	(1,349,123)	(942,553)
		(1,706,409)	(1,299,839)
		December 31, 2016
		Book Value	Fair Value
	Level		(In thousands NIS)
Debentures*)	Level 1	(1,219,929)	(1,071,436)

*) Fair value of bonds is based on the market price of the bonds in the TASE/ Polish stock exchange as of the June 30, 2017.

8. Significant events during the period

A. In accordance with the provision of the Notes trust deeds (Series H and Series I notes), the Company is required to publish its annual consolidated financial statements as required by law, by April 30 with an agreed extension of 30 days.

Since the Company did not meet the aforementioned deadline, as of 30 June 2017 the Bondholders were entitled to declare that all or a part of their respective outstanding debts become immediately due and payable. Should the bondholders exercise their right to declare immediate repayment, there is a cross default trigger in subsidiary's bank loan agreement that would allow the bank to demand repayment of the loan made. Therefore the Company classified bonds series I and its subsidiary's bank loan in the amount of NIS 569 million as of June 30, 2017 as current liabilities.

On July 3, 2017 and July 10, 2017, the Series H bondholders and series I bondholders, respectively approved a resolution to waive their immediate repayment right, pursuant to the delay in publications of the financial statements and to extend the submission date of the Company's annual financial statements for the year of 2016 until December 31, 2017 (the "Resolution").

On July 10, 2017, the Series I bondholders approved the Resolution as well and therefore, Series H approval became valid. The Company published it annual consolidation financial reports On November 13, 2017.

8. Significant events during the period (Cont.)

• B. On February 1, 2017 PC has completed the sale of SPV holding Suwałki Plaza commercial center in Poland to an investment fund. On completion PC has received approximately EUR 16.7 million (NIS 67 million) net cash, after the repayment of the bank loan (approximately EUR 26.6 million), and other working capital adjustments. The purchaser is an investment fund which is connected to a former employee of PC.
• C. On February 21, 2017 PC's wholly owned subsidiaries has concluded the sale of SPV holding the David House office building in Budapest, Hungary for circa EUR 3.2 million (NIS 13 million) and recorded a gain of circa EUR 0.56 million included in other income.
• D. On February 23, 2017 PC concluded the sale of a 26,057 sqm plot of land in Shumen, Bulgaria for approximately EUR 1 million (NIS 4 million)
• E. On March 2, 2017, an indirect subsidiary of the PC, has successfully completed the sale of SPV holding Belgrade Plaza commercial center, by one of its subsidiaries (the "SPV"), to a subsidiary of BIG Shopping Centers Ltd. (the "Purchaser").

The shopping center, which is currently over 97% pre-let, opened on 20th of April 2017 and PC had remained responsible for the development and leasing of the asset until the opening.

Upon completion of the transaction, PC has received an initial payment of EUR 31.2 million from the purchaser, EUR 2 million received following the opening and further payments contingent upon certain operational targets and milestones being met. PC has received a further payment of EUR 13.35 million during September 2017 based on the SPA on account of the final proceed which will be calculated one year following the opening of the mall, subject to price adjustments in the next two years. As a result, the company recorded a debtor in amount of EUR 13 .35 million. The Purchaser has provided a guarantee to secure these future payments. The Company recorded a gain from the sale in amount of circa EUR 3.3 million.

Expected Future purchase price adjustments are not included.

The final agreed value of Belgrade Plaza, which will comprise circa 32,300 sqm of GLA, will be calculated based on a general cap rate of 8.25% as well as the sustainable NOI after 12 months of operation, which PC estimates will be approximately EUR 7.2-7.5 million per annum. Further instalments will be due to PC during the first year of operation based on this 12-month figure. The NOI will be re-examined again after 24 months and 36 months of operation, which may lead to an upward adjustment of the final purchase price.

F. On March 23, 2017, the Company was informed by Gamida, that the orphan drug designation which has been granted by the European Medicines Agency's (EMA) Committee for Orphan Medicinal Products (COMP) regarding NiCord® has been broadened and now includes any treatment which based on blood system stem cells (haematopoietic stem cells) transplant.

The EMA grants an orphan drug designation to promote the development of products that demonstrate promise for the treatment of rare diseases. EMA Orphan drug designation provides 10 years of market exclusivity in the EU, as well as, prospective grants receiving easement and assistant with developing and registration of drugs for marketing.

G. On June 19, 2017 EPI signed a revised agreement in relation to the sale of a 100% interest in a special purpose vehicle which holds a site in Bangalore, India to the Partner.

The Partner and EPI have agreed that the purchase price will be amended to INR 338 Crores (approximately Euro 47 million) instead of the INR 321 Crores (approximately Euro 44.6 million) agreed in the previous agreement. As part of the agreement, INR 110 Crores (approximately Euro 15.3 million) will be paid by the Purchaser in instalments until the Final Closing. The Final Closing will take place on September 1, 2018, when the final instalment of INR 228 Crores (approximately Euro 31.7 million) will be paid to EPI.

If the Partner 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 agreement will remain in place until the Final Closing.

9. Subsequent events

• A. On July 9, 2017, the Company was informed by Gamida that an approximately \$40 million private financing investment has been completed ("the Investment"). The Investment was led by Shavit Capital Fund joined by the pharmaceutical company Novartis and additional investors, including VMS Investment Group, Israel Biotech Fund, IHCV and Clal Biotechnology Industries (the "Investors"). Following the Investment, a preferred shares were allotted to the Investors, based on \$120 million pre-money valuation to Gamida (the "Allotted Shares"). In addition, the investors received options to preferred shares in the amount of 60% of the Allotted Shares. The exercise price of the options is 120% of the shares price which have been paid on the Investment closing date. The options will expire 5 years after the Investment closing date. Upon completion of the investment, the Company holds 17.87% of the share capital in Gamida (13.63% fully diluted).
• B. In July 2017, PC has signed the final sale agreement for the disposal of a 1.8-hectare plot in the city of Leszno for €810,000.
• C. On August 7, 2017 PC has completed the sale of a plot totaling approximately 32,000 sqm in Timisoara, Romania, for Euro 7.25 million and a plot totaling approximately 30,000 sqm in Constanta, Romania, for Euro 1.3 million.
• D. On September 27, 2017 a dispute has arisen between PC's Israeli series A bondholders and PC's Israeli series B bondholders as to the allocation of funds received from sale of PC's real estate assets.

Notwithstanding the above, PC announced that in accordance with the provision of its debt restructuring plan ("Plan") it intends to repay to its bondholders in Poland, Israeli series A bondholders and Israeli series B bondholders (during October 2017), an aggregate amount of approximately EUR 18.8 million, representing 75% of the funds PC received in the last quarter from sale of real estate assets ("Mandatory Repayment Amount") to be allocated as follows: (i) Polish bondholders - 8.33%, as determined in the plan; (ii) Israeli series A bondholders - 21.23%, as determined in the plan; (iii) Israeli series B bondholders - 31.16% which is the proportional amount that corresponds to the ratio between the outstanding debts of the two Israeli series of bonds.

PC intends to deposit the remainder of the Mandatory Repayment Amount with a third-party trustee for the benefit of Israeli series A and series B bondholders and to submit a petition to the competent court in Israel requesting instructions with regard to the allocation of the remainder of the Mandatory Repayment Amount.

On October 4, 2016 the PC has received the consent of the trustees of its Israeli series A bonds and series B bonds for the allocation of certain funds received by PC between the PC's series A bonds and series B bonds due for repayment of such bonds as detailed above. PC further advises that it has filed an application with the Israeli court to receive instructions as to the allocation of the remainder funds between the Israeli series A and series B bondholders and the parties are currently waiting to the decision of the judge.

F. On October 2, 2017 PC has concluded the transaction with an international investor, NEPI Rockcastle (the "Buyer"), on the termination of land use right and preliminary easement agreement which created certain easement rights over the Arena Plaza plot registered in favor of PC subsidiary In consideration for termination of the land use right and the preliminary easement agreement, PC's subsidiary received the net sum of EUR 2.5 million.

9. Subsequent events (Cont.)

G. On November 21, 2017 PC completed the sale of SPV holding of the Torun Plaza shopping and entertainment center in Poland to an investment fund (the "Purchaser").

PC has received circa Euro 28.3 million. This net cash is after the deduction of the bank loan (circa €43.3 million), and other working capital adjustments in accordance with the balance sheet of the SPV holding the Project. The above mentioned sums do not include the earn out payment of circa €1.1 million which may be due at the end of May 2018 if new leases are signed by the end of April 2018.

H. On November 28, 2017, the Company has signed an amendment to the bank Hapoalim Loan Agreement so that the repayment date of the loan will be postponed as detailed below (the "Amendment" and the "Loan").

The loan balance of the debt as of November 22, 2017 is approximately 12.65 million EURO which were due on November 30, 2017. Upon signing the Amendment, the Company paid €1.05 million to the Bank, so that the balance of the Loan is now €11.6 million ("Updated Balance"). The Updated Balance will be repaid to the Bank in monthly installments, according to the following payment schedule:

• 1. €1 million will be repaid on December 27, 2017.
• 1. The remaining balance of the Loan will be paid no later than January 31, 2018.

The Loan will bear interest at the rate of LIBOR + 4.65%, to be paid by the Company in monthly installments beginning December 27, 2017.

Any funds that the Company will receive from the sale of the Radisson Blu Hotel in Bucharest Romania, and/or from any other sources, will be used for early repayment on account of, or full repayment, as the case may be, of the Loan.

I. On November 29, 2017, the Company has announced, that its wholly owned indirect subsidiary (the "Vendor") has signed a definitive sale and purchase agreement (the "Agreement") for the sale of its entire shareholding (comprising approx. 98.2% of the outstanding share capital) in the company (the "SPV") which owns the Radisson Hotel Complex in Bucharest, Romania, based on a property value of €169.2 million (the "Transaction"). The Agreement has been signed with an acquisition vehicle jointly owned by two international investment funds (the "Purchaser").

The consummation of the Transaction, which is expected to occur during the month of December 2017, is subject to the fulfillment of a conditions precedent, namely the obtaining by the Purchaser of externally sourced financing.

The estimated net proceeds to be derived from the Transaction (after offsetting the SPV's senior bank loan, working capital and other adjustments, as well as transaction expenses) is expected to be approximately €81 million. Part of the net proceeds equal to €8 million will be used to finance a vendor loan which has been granted for a period of 3 years, bearing interest at the rate of 5% per annum (the "Vendor Loan").

The Vendor Loan will act as collateral for customary post-closing liabilities of the SPV, whereby the Purchaser may offset adjudicated losses which may be incurred by it as a result of a breach of warranties or in respect of certain indemnities given by the Vendor in terms of the Agreement. Additionally, the Company has granted a letter of guarantee in favor of the Purchaser pursuant to which it has undertaken to fulfill the Vendor's undertakings and obligations under the Agreement (if and to the extent that the Vendor fails to do so). At this stage, there can be no certainty that the condition precedent will be met in a timely manner, or that the Transaction will be successfully consummated.

As a result, the Company recorded decrease in value of the hotel in the amount of approximately NIS 10 million in the financial statements as of June 30, 2017 in order to reflect its value based on the transaction.

- - - - - - - - - - - - - - - - - - -

Designated Disclosure with Respect to the Company's Projected Cash Flows

Whereas the Company was incorporated in Israel and its securities are also traded in the Tel Aviv Stock Exchange ("TASE"), it is subject to certain reporting requirements under the Israeli Securities Law, 1967, inter alia, the requirement to publish a projected cash flow for a period of 24 months (the "Projected Cash Flow") if and to the extent that a Warning Signs (as defined below) exists in the Company's financial statements; and also provide explanations on differences between previously disclosed Projected Cash Flow with actual cash flow

"Warning Signs" are defined under the Securities Regulations (Immediate and Periodic Notices) 5730-1970 (the "Regulations"), as one of the followings: (i) A deficit in shareholders 'equity; (ii) An opinion or review by the corporation's auditors as of the report date that includes reference to the corporation's financial condition; (iii) A deficit in working capital or in working capital for a period of twelve months together with a persistent negative cash flow from ongoing activity; (iv) A deficit in working capital or in working capital for a period of twelve months or an ongoing negative cash flow from ongoing activity and the Board of Directors of the corporation has not determined that this is not an indication of a liquidity problem in the corporation; (v) An opinion or review by the corporation's auditors as of the report date which includes reference to any material doubts concerning the continuation of the corporation's activities as a going concern;

The first three Warning Signs as described in the paragraph above exists in the Company's financial statements for 30.06.2017. Therefore the Company publishes this Projected Cash Flow of the Company (on a standalone basis) and the assumptions upon which it is based:

	June 30, 2017- December 31, 2017 (NIS	January 1, 2018- December 31, 2018 (NIS	January 1, 2019- December 31, 2019 (NIS
	Thousands)	Thousands)	Thousands)
Opening balance: Cash and cash equivalents	24	35	70
Projected Sources
Sources from realization of assets and business:
Cash flows from selling our holdings in the Radisson Hotel(1)	301		-
Cash flow from sale of our holdings in plot in India (Bangalore Project)(2)	7	79	-
Cash flow from selling of our medical business(3)	-	50	128
Cash Flow from repayment of loan to Elbit Medical(4)			154
Cash flow from sale of our holding in plot in India (Chennai project)(5)			32
Total Sources	332	164	384
Projected uses:
Debt service:
Principal payment to Bank Hapoalim(6)	51		- -
Interest payment to Bank Hapoalim(6)	1		- -
Principal payment to Series H note holders(6)	220	76	-
Interest payment to Series H note holders(6)	9		2 -
Principal and accrued interest payments to Series H note holders(6)	-		- 318
Payments to our subsidiary Plaza centers NV(7)	-		7 -
Payments to our subsidiary Bucuresti turism	3		- -
Other operating expenses
General and administrative expenses	5		9 5
Other non-recurring expenses(8)	8		- -
Total Uses	297	94	323
Closing balance: Cash and cash equivalents	35	70	61

Assumptions and explanations pertaining to the above Projected Cash Flow:

General assumption: the Projected Cash Flow was prepared based on the exchange rates, interest rates and the quoted market price of Elbit Medical Ltd. ("Elbit Medical") shares known close to the date of the approval of this report as follow:

USD/NIS Exchange rate	3.49
Euro/NIS exchange rate	4.12
Indian Rupee/NIS exchange rate	0.054
Euro Libor rate (%)	-
Elbit Medical share price on the TASE	0.13

(1) On November 30, 2017, the Company announced that its wholly owned indirect subsidiary has signed a definitive sale and purchase agreement for the sale of its entire shareholding (comprising approx. 98.2% of the outstanding share capital) in the company (the "SPV") which owns the Radisson Hotel Complex in Bucharest, Romania, based on a property value of €169.2 million (the "Transaction").

The consummation of the Transaction, which is expected to occur during the month of December 2017, is subject to the fulfillment of a conditions precedent, namely the obtaining by the Purchaser of externally sourced financing.

The estimated net proceeds to be derived from the Transaction (after offsetting the SPV's senior bank loan, working capital and other adjustments, as well as transaction expenses) is expected to be approximately €81 million. Part of the net proceeds equal to €8 million will be used to finance a vendor loan (from the Company to the purchaser) which has been granted for a period of 3 years, bearing interest at the rate of 5% per annum.

Receipt of the proceeds and their exact amount depend on a number of factors including: (i) that the transaction will be consummated; (ii) the estimated net working capital of the SPV as of the closing date as well as the estimated transaction and other expenses which will be borne by the Company as part of the closing; (iii) The transaction is quoted in Euro and therefore any change in the Euro/NIS exchange rate might affect the net proceed in NIS; and (iv) The Company assume that it will not be oblige to pay taxes as a result of this transaction based on the advice of its tax advisors. This assumption might be challenged by the relevant tax authorities.

• (2) This amounts are based on the agreement with our partner in the project ("Buyer") (for additional information see ITEM 4 "Recants Events" of the Company's form 20-F for fiscal year ended December 31, 2016). The main assumptions with respect to this amounts are: (i) that there will be no material delays in payments by the Buyer which could mainly result from liquidity problems of the Buyer including difficulties in obtaining financing for the project in order to execute the payments and to close the transaction; (ii) execution of offshore payments from India are subject to heavy regulations. Changes in the regulations (as was done in the past) might cause delays in payments or even inability to execute the transaction in its current structure; and (iii) The transaction is quoted in Indian Rupee ("INR") and therefore any change in the INR/NIS exchange rate might affect the net proceed in NIS.
• (3) Those amounts are based on realization of our shares in Elbit Medical based on the quoted price of Elbit Medical shares in the TASE after taking into account certain deductions. The main assumptions that might affect those amounts are: (i) the share price of Elbit Medical in the TASE which can change due to changes in the business of Elbit Medical (i.e. in the business of InSightec Ltd. ("Insightec") and Gamida Cell Ltd. ("Gamida"), both are private Bio-Med companies in which Elbit Medical holds 30% and 17.8%, respectively) and / or due to trading trends on the TASE; (ii) the business of Elbit Medical (i.e. in the business of InSightec and Gamida) is denominated and measured in US Dollar, therefore changes in the USD/NIS exchange rate might affect the share price of Elbit Medical and in turn affect the net proceed in NIS; (iii) Low trading volumes in Elbit Medical's share on the TASE in a manner that will not enable the sale under such terms (i.e. price and timing); (IV) the general trend in the Biomed market.

• (4) The Company granted 3 loans to its subsidiary Elbit medical which are due on January 1, 2019. The main assumptions that might affect those amounts are: (i) the ability of Elbit Medical to repay the loan on time; (ii) one of the loan is quoted in USD therefore changes in the USD/NIS exchange rate might affect the net proceed in NIS;
• (5) The Projected proceed from the sale of the Company's right in the plot in Chennai takes into account certain deduction from its value according to the Company financial statement as for June 30, 2017. The main assumptions with respect to this amounts are: (i) the Company will find a reputable buyer for this plots on "as is where is" situation since the Company has no ability to make progress in the zoning of the plot; (ii) the Company estimates that the proposed purchaser will finance a significant part pf the transaction by obtaining an external financing. There is no assurance that such financing will be granted to the proposed purchaser; (iii) execution of offshore payments from India are subject to heavy regulations. Changes in regulations (as was done in the past) might cause delays in payments or even inability to execute the transaction in its current structure; and (iv) any transaction will be quoted in Indian Rupee ("INR") and therefore any change in the INR/NIS exchange rate might affect the net proceed in NIS; (V) general trend of the residential market in Chennai.
• (6) The principal and the interest payments to bank Hopaolim can mainly be affected by the Euro/ NIS exchange rate as well as the Euro Libor interest rate. The principal and the interest payments to Series H noteholders and Series I noteholders can mainly be affected from increase in the Israeli Consumer Price Index ("CPI") (whereas the principal and interest payments are linked to changes in the CPI of November 2013).

The Company assumes that it will make an early repayment of interest and principal to its series H holders in the amount of NIS 220 million following the completion of the sale of the Radisson Blu Hotel (It should be noted that in a document that the Company published to the public in connection with the sale of the Radisson Blu Hotel, it stated that the proceeds of the transaction will be used for early repayment of at least NIS 190 million to series H holders, but the Company also stated that it reserves the discretion to decide on a higher amount).

• (7) The Company has an outstanding debts to PC in the amount of approximately Euro 1.7 million. The debt (principal and interest) is due on May 31, 2018 with early mandatory prepayments upon the sale of our plots in India. The principal and the interest payments to PC can mainly be affected by the Euro/ NIS exchange rate.
• (8) The non-recurring expenses include mainly expenses due to: (i) the extensive legal and accounting expenses in connection with the preparation and publication of our financial statement for the year that ended on December 31, 2016; (ii) payment of the Company's share in a settlement of the Gadish class actions against the Company and others (for additional information see Item ITEM 4 - "Recents Events" of the Company's form 20-F for fiscal year ended December 31, 2016).

The Company has additional cash generating abilities that were not taken in to account in preparing the Projected Cash Flow detailed above. The following describes the Company's assumptions regarding these additional cash generating abilities:

Item	Amount (NIS million)	Additional information
Plot in Kochi, India	5	Based on transaction signed on January 14, 2016_for the sale of this plot. For additional information see ITEM 4 - "Recents Events" of the Company's form 20-F for fiscal year ended December 31, 2016.
Shares in Olive	4	The Company holding in Olive is approximately 16.3%. The estimation is based on preliminary analysis done internally by the Company.
Vendor loan in respect of the sale of our holding in Radisson	38	Represents the principal and interest payments with respect to the vendor loan which will be granted by the Company to the Purchaser of the rights in Radisson Blu Hotel. It should be noted that all the principal payment and part of the interest payments are due 3 years from the anticipated closing date (i.e.: December 2020).
Share in PC (45%)	-	Due to the significant debt burden of PC and the going concern note included in PC's financial statements, the Company assume that its equity position in PC is negligible.
Total	47

The information detailed above, concerning the Company's cash flow forecast, including the materialization, occurrence, consummation and execution of the events, transactions and of the assumptions on which such Projected Cash Flow is based, are forward looking information as defined in the Securities Law, 5728-1968. This information includes forecasts, subjective, assessments, estimates, etc. and is based, among other things, on the Company management's past experience. Furthermore, some of such information is based on future data and internal estimates by the Company's management made at the current time, and there is no certainty that they will materialize, in whole or in part, due to factors that are not in the Company's control. It is hereby clarified that there is a likelihood that said forward looking information will not be realized in whole or in part, both with respect to the Company's forecasts and with respect to the working assumptions on which they are based.