Note 22 - Operating Segments

The Company’s reportable segments, which form the Company’s strategic business units, are described below:

•

Photovoltaic power plants (PV Plants) – Operation of installations that convert the energy in sunlight into electrical energy as follows: (i) approximately 22.6MWp aggregate installed capacity of photovoltaic power plants in Italy, that the Company sold on December 20, 2019, (ii) approximately 7.9MWp aggregate installed capacity of photovoltaic power plants in Spain, (iii) a photovoltaic power plant of approximately 9 MWp installed capacity in Israel and (iv) Talasol, which is constructing a photovoltaic plant with a peak capacity of 300 MW in the municipality of Talaván, Cáceres, Spain.

•

Dorad Energy Ltd. (Dorad) – 9.375% indirect interest in Dorad, which owns and operates a combined cycle power plant based on natural gas, with production capacity of approximately 860 MW, located south of Ashkelon, Israel.

•

Anaerobic digestion plants (Biogas) – Groen Gas Goor B.V. and of Groen Gas Oude-Tonge B.V., project companies operating anaerobic digestion plants with a green gas production capacity of approximately 375 Nm3/h, in Goor, the Netherlands and 475 Nm3/h, in Oude Tonge, the Netherlands, respectively.

•

Pumped storage hydro power plant (Manara) – 75% of a project to construct a 156 MW pumped storage hydro power plant in the Manara Cliff, Israel.

Factors that management used to identify the Company’s reportable segments

The Company’s strategic business units offer different products and the allocation of resources and evaluation of performance is managed separately because they require different technology.

For each of the strategic business units, the Company’s chief operating decision maker (CODM) reviews internal management reports on at least a quarterly basis. The following summary describes the operations in each of the Company’s operating segments.

The Company presented the photovoltaic power plants per geographical areas, as the information collected and analyzed by the CODM in connection with the PV Plants is presented based on the physical location of the PV Plant. The CODM reviews the Israeli Shekel denominated information on Dorad and the PV Plant located in Israel and the information presented in the tables below is translated into euro. The CODM reviews the Company’s share in the results of Dorad. In the reports analyzed by the CODM, the PV Plant located in Israel is presented under the fixed asset model and not under the financial asset model as per IFRIC 12.

Performance is measured based on segment gross profit as included in reports that are regularly reviewed by the chief operating decision maker. Segment gross profit is used to measure performance as management believes that such information is the most relevant in evaluating the results of certain segments relative to other entities that operate within these industries.

Segment assets consist of current assets and fixed assets, as included in reports provided regularly to the chief operating decision maker.

	PV																				Total
																					reportable						Total
	Italy			Spain			Israel			Talasol			Biogas			Dorad			Manara		segments			Reconciliations			consolidated
	For the year ended December 31, 2019
	€ in thousands

Revenues		10,082			2,987			4,114			-			4,786			63,416			-		85,385			(66,397	)		18,988
Operating expenses		(1,422	)		(504	)		(325	)		-			(4,387	)		(48,558	)		-		(55,196	)		48,558			(6,638	)
Depreciation and amortization expenses		(3,668	)		(903	)		(2,271	)		(30	)		(1,353	)		(5,031	)		-		(13,256	)		6,840			(6,416	)
Gross profit (loss)		4,992			1,580			1,518			(30	)		(954	)		9,827			-		16,933			(10,999	)		5,934
Project development costs																												(4,213	)
General and
administrative expenses																												(3,827	)
Share of profits (loss) of
equity accounted investee																												3,086
Other income, net																												(2,100	)
Capital gain (loss)																												18,770
Operating profit																												17,650
Financing income																												1,827
Financing income
(expenses) in connection
with derivatives, net																												897
Financing expenses, net																												(10,877	)
Profit before taxes on
Income																												9,497
Segment assets as at
December 31, 2019		-			16,324			38,942			118,848			18,463			116,561			2,473		311,611			(1,439	)		310,172

	PV																			Total
																				reportable						Total
	Italy			Spain			Israel			Talasol		Biogas			Dorad			Manara		segments			Reconciliations			consolidated
	For the year ended December 31, 2018
	€ in thousands

Revenues		9,560			3,033			4,011			-		4,483			58,063			-		79,150			(61,033	)		18,117
Operating expenses		(1,579	)		(574	)		(507	)		-		(3,682	)		(44,600	)		-		(50,942	)		44,600			(6,342	)
Depreciation and amortization expenses		(3,569	)		(828	)		(2,042	)		-		(1,081	)		(4,811	)		-		(12,331	)		6,515			(5,816	)
Gross profit (loss)		4,412			1,631			1,462			-		(280	)		8,652			-		15,877			(9,918	)		5,959
Project development costs																											(2,878	)
General and
administrative expenses																											(3,600	)
Share of profits (loss) of
equity accounted investee																											2,545
Other income, net																											884
Operating profit																											2,910
Financing income																											2,936
Financing income
(expenses) in connection
with derivatives, net																											494
Financing expenses, net																											(5,521	)
Profit before taxes on
Income																											819
Segment assets as at December 31, 2018		54,539			16,799			34,258			15,169		18,879			105,246			2,318		247,208			(36,048	)		211,160

	PV																	Total
																		reportable						Total
	Italy			Spain			Israel			Dorad			Biogas			Manara		segments			Reconciliations			consolidated
	For the year ended December 31, 2017
	€ in thousands

Revenues		10,143			3,007			1,378			58,234			303			-		73,065			(59,429	)		13,636
Operating expenses		(1,660	)		(677	)		(117	)		(45,027	)		(95	)		-		(47,576	)		45,027			(2,549	)
Depreciation and amortization expenses		(3,567	)		(828	)		(447	)		(4,817	)		(111	)		-		(9,770	)		5,252			(4,518	)
Gross profit		4,916			1,502			814			8,390			97			-		15,719			(9,150	)		6,569
Project development costs																									(2,739	)
General and
administrative expenses																									(2,420	)
Share of pro loss of equity
accounted investee																									1,531
Other income, net																									18
Operating Profit																									2,959
Financing income																									1,333
Financing income
(expenses) in connection
with derivatives, net																									(3,156	)
Financing expenses, net																									(7,405	)
Loss before taxes
on Income																									(6,269	)

Segment assets as at December 31, 2017		59,441			16,779			37,903			114,282			16,882			2,386		247,673			(49,586	)		198,087

Geographical information

The Company is domiciled in Israel and it operates in Israel, Italy and in Spain through its subsidiaries that own seventeen PV Plants, in the Netherlands through its subsidiaries that own anaerobic digestion plants and also in Israel through Dori Energy. On December 20, 2019, the Company sold ten Italian Subsidiaries, which own twelve photovoltaic plants with an aggregate nominal capacity of approximately 22.6 MW.

The following table lists the revenues from the Company's operations in Israel, the Netherlands, Italy and Spain:

	For the year ended December 31
	2019		2018		2017
	€ in thousands
Israel		1,133		1,041		183
The Netherlands		4,786		4,483		303
Italy		10,082		9,560		10,143
Spain		2,987		3,033		3,007
Total revenues		18,988		18,117		13,636

The following table lists the fixed assets, net from the Company's operation:

	For the year ended December 31
	2019		2018
	€ in thousands
Israel		19		17
The Netherlands		17,043		17,464
Italy		-		44,986
Spain		109,545		24,753
Total fixed assets, net		126,607		87,220