Kardan N.V. — Earnings Release 2008

May 30, 2008

PRESS RELEASE Amsterdam/Tel Aviv, 29 May 2008

Number of pages: 7

KARDAN BENEFITS FROM EMERGING MARKETS GROWTH WITH STRONG RESULTS OVER THE FIRST QUARTER 2008

• Net profit attributable to equity holders increased sharply to EUR 13 million from a loss in Q1 2007
• Increase in total assets of 5.4% to EUR 4.5 billion from EUR 4.3 billion at year-end 2007
• Continued expansion of main operations with doubling of revenues from Q1 2007
• High activity level in the real estate segment in China; two new projects signed
• Further simplification of holding structure envisaged

Key figures (x EUR million)	31 March 2008	31 Dec. 2007	Change (%)
Total assets	4,501	4,272	5.4%
Shareholders' equity	347	343	1.2%
Return on Equity (%)	3.7%	29.61%
Net Debt / (Net Cash) 2	189	174

(x EUR million)	Q1 2008	Q1 2007
Net profit (loss) attributable to equity holders3	13	(4)
Of which:
Main businesses
Real Estate	10	(8)
Financial Services – Insurance & Pension	(4)	-
Financial Services – Banking & Retail lending	(2)	1
Infrastructure – Projects	-	-
Infrastructure – Assets	(1)	(1)
Other businesses	-	1
Other (mainly corporate activities)	10	3

* as Kardan is reporting in millions instead of thousands, and these numbers are below EUR 0.5 million, no number is recorded

"After a year with numerous transactions and acquisitions, we further invested in selected opportunities while showing a healthy growth in activities and results over the first quarter. With the funds raised during 2007, we have expanded our platform in emerging markets and intend to continue with this strategy. Our strong track record and familiarity with the dynamics of emerging markets enable us to benefit from the developments of these markets, which have seen a limited impact from the current economic turmoil so far." according to Mr. Ickovics, Chairman of the Management Board of Kardan N.V.

¹ROE based on average equity over the year

² The definition of Net Debt as presented in this press release includes interest bearing loans, borrowings and (convertible) debentures, less cash and cash equivalents and interest bearing receivables.

³ The above table shows the contribution of each of the businesses to the results of Kardan. As profits attributable to minority shareholders have already been deducted, these figures do not represent the full net profit realized in each segment.

Financial overview

International investment company Kardan N.V. (Kardan) generated total revenues in the first quarter 2008 of EUR 207 million, a significant growth compared to the same period last year (Q1 2007: EUR 87 million). This growth is attributable to the full consolidation of the financial services segment (since 1 April 2007), the revaluation gains in the real estate segment, the overall growth of the operations and the continuous expansion of activities, mainly in the infrastructure segment. Main operations (Real Estate, Financial Services and Infrastructure) contributed EUR 154 million to Kardan's revenues over the first quarter 2008, compared to EUR 69 million in the same quarter last year. The steep increase in financing income from EUR 8 million in the first quarter of 2007 to EUR 45 million in the first quarter of 2008 was another main contributor to the revenue growth. The increase in financing income is mainly due to the positive result of equity revaluations of convertible debentures and other financial instruments.

The total operating result for the first quarter of 2008 amounted to EUR 57 million (Q1 2007: EUR 21 million). Main businesses realised an operating result of EUR 56 million compared to EUR 18 million in the first quarter 2007. Other businesses showed an operating profit of EUR 1 million.

Financial expenses, net for the first quarter of 2008 decreased to EUR 4 million from EUR 17 million in the same quarter 2007. The financial expenses consist of higher expenses related to the increased debt level due to fund raising during 2007 and foreign exchange expenses from dollar denominated loans granted and deposits. These expenses are offset by the revaluation of option rights due to share price decreases of the listed group companies. For the first quarter 2008, taxes amounted to EUR 13 million (Q1 2007: EUR 5 million).

As a result of the above, a total net profit of EUR 37 million was generated in the first quarter of 2008, compared to a net loss of EUR 3 million for the first quarter of 2007. Accordingly, the minorities' share in the net result increased from EUR 1 million in the first quarter 2007 to a profit of EUR 24 million. Net result attributable to equity holders for the first quarter of 2008 amounted to EUR 13 million (Q1 2007: loss of EUR 4 million). This represents a basic net result per share of EUR 0.16, compared to a basic net loss per share of EUR 0.06 for the first quarter of 2007.

Group value

Total assets grew by 5.4% during the first quarter, from EUR 4.3 billion as at year-end 2007 to EUR 4.5 billion per 31 March 2008. The increase in total assets was mainly the result of the expansion of activities and small acquisitions.

As of 31 March 2008, shareholders' equity amounted to EUR 347 million, a slight increase compared to EUR 343 million at year-end 2007, mainly as a result of the profit over the period, less the change in foreign currency translation reserves.

Outlook

Kardan has grown to be an important player in the emerging markets. There has been a limited impact of the current economic turmoil on emerging markets, and therefore assuming these markets will continue their economic development, Kardan is well positioned to directly benefit from such growth. Based on its current liquidity position and low leverage, Kardan is able to further invest in developing and expanding its business. With its strong track record of operating in challenging environments while looking at long term value creation, Kardan is confident it can continue to capitalize on opportunities that arise from the current market conditions.

Divisional review⁴

Real Estate

(x EUR million)	Q1 2008	Q1 2007	Change (%)
Revenues	75	32	134%
Operational result	59	17	247%

Revenues in the real estate segment increased sharply due to the revaluation of investment properties of EUR 49 million (Q1 2007: EUR 11 million), and a further growth in contract revenues. Subsequently, operating profit showed a significant increase over the quarter.

GTC RE, the real estate subsidiary of Kardan, has been very active in China in the year to date, with the purchase of several new land plots. In the beginning of 2008, GTC RE purchased two land plots of approximately 195,000 sqm with building rights up to about 542,000 sqm in the city of Changzhou for a consideration of EUR 34.4 million. Changzhou is the fourth Chinese city in which GTC RE established operations. In February 2008, GTC RE won a tender for the acquisition of a land plot in the city of Shenyang, with approximately 650,000 sqm of building rights. The consideration for this plot amounted to EUR 35 million.

Both projects are developed with Lucky Hope, GTC RE's partner in China. The new projects are mixed use, mainly residential and include commercial space. Construction of both projects is expected to start during the second half of this year and is estimated to take five (Changzhou) and four (Shenyang) years. The total project pipeline in China is currently more than 2.6 million sqm in various stages of development.

At the end of the quarter, Kardan announced its intention to merge its Israeli real estate subsidiary Kardan Real Estate Ltd. (Kardan RE) with Delek Real Estate (DRE) to create one of the largest residential property developers in Israel. The combination will have a land bank for the development of approximately 7,000 housing units of which 1,600 are already under construction. Upon completion of the transaction, Kardan RE will be jointly held by Kardan Israel (60%) and DRE (40%).

After the period under review, Kardan announced that in order to simplify the group structure and further increase transparency it is in the process of investigating the possibilities to merge GTC RE into Kardan. If this merger takes place, it will create a larger holding company, and will strengthen the equity position and the value of the combined entity.

GTC RE is active in Europe through GTC SA and GTC Investments B.V., in China through GTC Real Estate China Ltd. and in India. Kardan currently holds (directly and indirectly) a 70% stake in GTC RE, which holds a 46% stake in GTC SA. GTC RE's net debt position as of 31 March 2008 amounted to EUR 196 million.

⁴ All figures in the review of operations are presented before minority interests thus represent 100% of the results of each sector and therefore cannot be compared to the figures presented in the table on the first page. In that table the contribution of each of the businesses to the results of Kardan is presented.

Financial Services

(x EUR million)	Q1 2008	Q1 2007	Change (%)
Revenues – Insurance & Pension	28	9	211%
Revenues – Banking & Retail lending	23	13	77%
Operating result – Insurance & Pension	(3)	1
Operating result – Banking & Retail lending	*	*

* as Kardan is reporting in millions instead of thousands, and these numbers are below EUR 0.5 million, no number is recorded

The revenues of the financial services sector increased sharply due to the organic growth of the businesses, the full consolidation as from 1 April 2007, as well as due the acquisitions of insurance operations throughout 2007. Operating result decreased to a loss of EUR 3 million in the insurance and pension segment, partly due to the first consolidation of the Russian operations that show a negative operating result. The operating result for TBIF was slightly positive and in line with the first quarter of last year.

KFS has been predominantly active in the continuous development of its activities in Russia and Ukraine. TBIF increased its stake in the Russian banking and consumer finance operations to 60% from 50% and finalized the "AVIS Ukraine" transaction, purchasing, with a partner, 90% of a company that operates a car rental and operational lease business in Ukraine under the AVIS brand. TBIH completed the acquisition of a 62% stake in UIG, a Ukrainian non life insurance company.

KFS is the holding company of TBIF and TBIH. Kardan holds a direct stake of 80% in KFS, which in turn holds 90% and 40% in TBIF and TBIH respectively. KFS had a net debt position of EUR 67 million as of 31 March 2008.

Infrastructure

(x EUR million)	Q1 2008	Q1 2007	Change (%)
Revenues – Projects	19	15	26%
Revenues – Assets	9	*
Operating result – Projects	*	*
Operating result – Assets	*	*

* as Kardan is reporting in millions instead of thousands, and these numbers are below EUR 0.5 million, no number is recorded

As part of the focus on the ownership and development of infrastructure assets, Kardan has, as of Q4 2007, split the reporting of Tahal into Projects, activities relating to advisory and turnkey projects, and Assets, activities relating to the development, management and ownership of assets.

As there were almost no activities in the Assets sector during the first quarter of 2007, all revenues and results from the first quarter of 2007 related to projects. Due to the focus on asset ownership, Tahal was able to generate revenues of EUR 9 million from assets during the quarter. In addition, Tahal's revenues in projects increased compared to the same period last year. The operating results from projects were slightly positive, while the operating results from assets were slightly negative.

In February of this year, Tahal signed an agreement with the national water company of Angola regarding the development of a water supply infrastructure project, including the design of the distribution system and the installation of 400 km of PVC pipes and 140 fountains.

Tahal is fully owned by Kardan. Approximately 90% of Tahal's activities are directly related to water and sewage systems. Tahal's net cash as of 31 March 2008 amounted to EUR 16 million.

Other operations

The revenues of the other operations (Automotive & Consumer Goods and Communication & Technologies) amounted to EUR 7 million in the first quarter of 2008, a slight decrease compared to EUR 8 million in the first quarter of 2007. Other operations contributed EUR 1 million to operating profits (Q1 2007: EUR 2 million).

Kardan's other operations are held through its 71% subsidiary Kardan Israel. Kardan Israel's net debt position amounted to EUR 23 million as of 31 March 2008.

About Kardan

Kardan is an international investment company based in Amsterdam with a focus on three sectors: Real Estate, Financial Services and Infrastructure. The company is primarily active in emerging markets in Central and Eastern Europe and China, where it conducts most of its activities.

Kardan holds controlling interests in its main businesses and is actively involved in the definition and implementation of their strategy. Kardan has a consistent track record of creating long-term shareholder value through active management of investments in the group companies and by leveraging on its business experience, financial resources and local and international network.

Total assets per December 31, 2007 amounted to EUR 4.3 billion, with revenues of EUR 774 million. The number of employees engaged by the group is approximately 13,411 as of December 31, 2007. Kardan is listed on Euronext Amsterdam and the Tel-Aviv Stock Exchange.

The condensed interim financial statements according to IFRS will be published on the website of Kardan at www.kardan.com.

Enclosed:

• P&L (drawn up according to IFRS)
• Balance sheet (drawn up according to IFRS)

For further information please contact:

Citigate First Financial Uneke Dekkers phone +31 (0) 20 575 40 21 / mobile +31(0)6 50 26 16 26 Claire Verhagen phone +31 (0) 20 575 40 18 / mobile +31(0)6 50 51 63 25

Condensed Profit & Loss account

(x EUR 1,000,000) UNAUDITED

	Q1 2008	Q1 2007
Revenues	207	87
Expenses	150	66 ------------------ ------------------
Results from operations	57	21
Unallocated expenses Financing result	3 4	2 17 ------------------ ------------------
Income / loss before taxes Taxes on income	50 13	2 5 ------------------ ------------------
Income / loss after taxes Minority interest	37 24	-3 1 ------------------ ------------------
Net income (loss)	13 ==========	-4 ==========

Page 7 of 7

May 29, 2008

31 March 2008	31 Dec. 2007
	AUDITED
2.627	2.343
1.150	1.036
724	893
4.501	4.272
347	343
752	730
2.355	2.066
1.047	1.133
4.501	4.272
	UNAUDITED ------------------------ ----------------------- ============== ============= ------------------------ ----------------------- ============== =============