G. Willi-Food international Reports the results of first quarter 2024
G. Willi-Food International (NASDAQ: WILC) announced its unaudited Q1 2024 financial results, showing a 10.1% decrease in sales to NIS 136.0 million (USD 37.0 million) compared to Q1 2023.
Gross profit fell by 13.5% to NIS 34.7 million (USD 9.4 million), and operating profit declined by 10.7% to NIS 11.6 million (USD 3.2 million).
However, net profit surged by 72.2% to NIS 18.6 million (USD 5.1 million), mainly due to a significant increase in financial income to NIS 11.5 million (USD 3.1 million).
The company ended Q1 2024 with a cash and securities balance of NIS 244.4 million (USD 66.4 million).
Willi-Food continues to navigate challenges, including delays in goods arrival and increased costs, while working on improving commercial terms and constructing a new logistics center expected to complete by end of 2025.
- Net profit increased by 72.2% to NIS 18.6 million (USD 5.1 million).
- Financial income, net increased significantly to NIS 11.5 million (USD 3.1 million).
- Company maintains a strong cash and securities balance of NIS 244.4 million (USD 66.4 million).
- Selling expenses decreased by 17.3% to NIS 16.5 million (USD 4.5 million).
- General and administrative expenses decreased by 8.0% to NIS 6.6 million (USD 1.8 million).
- Net cash from operating activities stood at NIS 3.8 million (USD 1.0 million).
- Shareholders' equity totaled NIS 561.0 million (USD 152.4 million).
- Sales decreased by 10.1% to NIS 136.0 million (USD 37.0 million).
- Gross profit fell by 13.5% to NIS 34.7 million (USD 9.4 million).
- Operating profit decreased by 10.7% to NIS 11.6 million (USD 3.2 million).
- Gross margins decreased from 26.5% to 25.5%.
- Increased costs of imported products and shipping were not passed on to clients.
- The company faced significant delays in goods arrival from the Far East.
Insights
The financial results for Willi-Food's first quarter of 2024 reveal a mixed performance. While sales decreased by 10.1% year-over-year, mainly due to delays in the arrival of goods, the net profit increased by 72.2%, largely driven by significant financial income. This divergence between operational and financial performance is noteworthy and requires careful consideration.
The drop in sales to
Interestingly, the company's gross profit margin fell from 26.5% to 25.5%, suggesting an increase in cost of goods sold that wasn't passed onto clients. This could indicate market pressure and tight competition.
From an investment perspective, the substantial rise in financial income, primarily from portfolio revaluation, introduces a volatile element. While this boosts net profit significantly, reliance on such income for sustained profitability can be risky. Investors should note that the core business operations have demonstrated resilience but not growth, suggesting a cautious outlook in the short-term while looking at long-term strategic initiatives, such as the construction of the new logistics center.
The food import and distribution industry, especially in niche markets like kosher foods, is sensitive to global supply chain disruptions. The 10.1% decline in sales due to shipping lane closures on the Red Sea highlights the company's vulnerability to geopolitical and logistical issues. However, this also underscores the importance of strong logistics infrastructure, which the management is addressing with the construction of a new logistics center expected by the end of 2025.
Willi-Food's market strategy seems robust as it focuses on improving commercial terms with customers and suppliers. This is a smart move to enhance margins and mitigate cost pressures. However, the decrease in advertising expenses might suggest a potential risk in brand visibility and market penetration in the near term.
Investors should monitor how efficiently the new logistics center can be integrated into the company's operations and whether it can indeed drive growth and improve profitability as projected. The current geopolitical landscape and import challenges will likely remain key factors impacting performance in the near term.
YAVNE,
First Quarter Fiscal Year 2024
- Sales decreased by
10.1% to NIS 136.0 million (USD 37.0 million ) fromNIS 151.4 million (USD 41.1 million ) in the first quarter of 2023. - Gross profit decreased by
13.5% year-over-year toNIS 34.7 million (USD 9.4 million ). - Operating profit decreased by
10.7% year-over-year to NIS 11.6 million (USD 3.2 million ). - Basic earnings per share of
NIS 1.34 (USD 0.36 ). - Cash and securities balance of
NIS 244.4 million (USD 66.4 million ) as of March 31, 2024.
Management Comment
Zwi Williger & Joseph Williger, Chairmen and CEO of Willi-Food, commented: "We are happy to present the financial results of the first quarter of 2024. Although we experienced a decline in sales as a result of significant delays in the arrival of goods, especially from the Far East, we believe we have managed to achieve favorable results, both at the operational level and with respect to our financing income. While the
First Quarter Fiscal 2024 Summary
Sales for the first quarter of 2024 decreased by
Gross profit for the first quarter of 2024 decreased by
Selling expenses decreased by
General and administrative expenses for the first quarter of 2024 decreased by
Operating profit for the first quarter of 2024 decreased by
Financial income, net increased to
Willi-Food's income before taxes in the first quarter of 2024 increased to
Willi-Food's net profit in the first quarter of 2024 was
Willi-Food ended the first quarter of 2024 with
NOTE A: NIS to USD exchange rate used for convenience only
The convenience translation of New Israeli Shekels (NIS) into
NOTE B: IFRS
The Company's consolidated financial results for the three-month period ended March 31, 2024 are presented in accordance with International Financial Reporting Standards ("IFRS").
About G. Willi-Food International Ltd.
G. Willi-Food International Ltd. (http://www.willi-food.com) is an Israeli-based company specializing in high-quality, great-tasting kosher food products. Willi-Food is engaged directly and through its subsidiaries in the design, import, marketing and distribution of over 650 food products worldwide. As one of
FORWARD LOOKING STATEMENT
This press release contains forward-looking statements within the meaning of safe harbor provisions of the Private Securities Litigation Reform Act of 1995 relating to future events or our future performance, such as statements regarding trends, demand for our products, expected sales, operating results, and earnings. Forward-looking statements include statements regarding the commercial terms with customers and suppliers and timing of construction of the Company's new logistics center and its expected benefits. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied in those forward-looking statements. These risks and other factors include but are not limited to: the inability to improve commercial terms with customers and suppliers: delays in the construction of the Company's new logistics center and the risk that its expected benefits will not be materialized, monetary risks including changes in marketable securities or changes in currency exchange rates- especially the NIS/
G. WILLI-FOOD INTERNATIONAL LTD. CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||
March 31, | December 31 | March 31, | December 31 | |||
2024 | 2023 | 2023 | 2024 | 2023 | 2023 | |
NIS | US dollars (*) | |||||
(in thousands) | ||||||
ASSETS | ||||||
Current assets | ||||||
Cash and cash equivalents | 134,850 | 131,472 | 137,466 | 36,634 | 35,716 | 37,345 |
Financial assets at fair value through | 109,571 | 105,272 | 102,163 | 29,767 | 28,599 | 27,754 |
Trade receivables, Net | 154,565 | 177,648 | 160,379 | 41,990 | 48,261 | 43,570 |
Other receivables and prepaid expenses | 13,552 | 8,113 | 10,164 | 3,682 | 2,204 | 2,761 |
Inventories, Net | 74,882 | 95,596 | 62,475 | 20,343 | 25,970 | 16,972 |
Current tax assets | 6,759 | 2,732 | 9,497 | 1,836 | 742 | 2,580 |
Total current assets | 494,179 | 520,833 | 482,144 | 134,252 | 141,492 | 130,982 |
Non-current assets | ||||||
Property, plant and equipment | 128,936 | 106,052 | 122,222 | 35,027 | 28,811 | 33,203 |
Less -Accumulated depreciation | 56,876 | 52,593 | 55,636 | 15,451 | 14,288 | 15,114 |
72,060 | 53,459 | 66,586 | 19,576 | 14,523 | 18,089 | |
Right of use asset | 3,376 | 3,289 | 2,124 | 917 | 894 | 577 |
Financial assets at fair value through | 46,159 | 44,084 | 46,143 | 12,540 | 11,976 | 12,535 |
Goodwill | 36 | 36 | 36 | 10 | 10 | 10 |
Total non-current assets | 121,631 | 100,868 | 114,889 | 33,043 | 27,403 | 31,211 |
615,810 | 621,701 | 597,033 | 167,295 | 168,895 | 162,193 | |
EQUITY AND LIABILITIES | ||||||
Current liabilities | ||||||
Current maturities of lease liabilities | 1,760 | 2,243 | 1,512 | 478 | 609 | 411 |
Trade payables | 20,728 | 27,242 | 21,622 | 5,631 | 7,401 | 5,874 |
Employees Benefits | 4,769 | 4,590 | 4,193 | 1,296 | 1,247 | 1,139 |
Other payables and accrued expenses | 18,617 | 41,068 | 10,854 | 5,058 | 11,157 | 2,949 |
Total current liabilities | 45,874 | 75,143 | 38,181 | 12,463 | 20,414 | 10,373 |
Non-current liabilities | ||||||
Lease liabilities | 1,588 | 1,205 | 694 | 431 | 327 | 189 |
Deferred taxes | 6,287 | 3,663 | 4,868 | 1,708 | 995 | 1,322 |
Retirement benefit obligation | 1,055 | 924 | 1,055 | 287 | 251 | 287 |
Total non-current liabilities | 8,930 | 5,792 | 6,617 | 2,426 | 1,573 | 1,798 |
Shareholders' equity | ||||||
Share capital | 1,490 | 1,490 | 1,490 | 405 | 405 | 405 |
Additional paid in capital | 172,789 | 171,976 | 172,589 | 46,941 | 46,720 | 46,886 |
Remeasurement of the net liability in | (154) | (195) | (154) | (42) | (53) | (42) |
Capital fund | 247 | 247 | 247 | 67 | 67 | 67 |
Retained earnings | 387,262 | 367,876 | 378,691 | 105,206 | 99,940 | 102,877 |
Treasury shares | (628) | (628) | (628) | (171) | (171) | (171) |
Equity attributable to owners of the | 561,006 | 540,766 | 552,235 | 152,406 | 146,908 | 150,022 |
615,810 | 621,701 | 597,033 | 167,295 | 168,895 | 162,193 | |
(*) Convenience translation into | ||||||
G. WILLI-FOOD INTERNATIONAL LTD. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
Three months | Three months | |||
ended | ended | |||
March 31, | March 31, | |||
2024 | 2023 | 2024 | 2023 | |
NIS | US dollars (*) | |||
In thousands (except per share and share data) | ||||
Sales | 136,036 | 151,356 | 36,956 | 41,118 |
Cost of sales | 101,385 | 111,322 | 27,542 | 30,242 |
Gross profit | 34,651 | 40,034 | 9,414 | 10,876 |
Operating costs and expenses: | ||||
Selling expenses | 16,475 | 19,919 | 4,476 | 5,411 |
General and administrative expenses | 6,550 | 7,117 | 1,779 | 1,933 |
Other income | - | (25) | - | (7) |
Total operating expenses | 23,025 | 27,011 | 6,255 | 7,337 |
Operating profit | 11,626 | 13,023 | 3,159 | 3,539 |
Financial income | 12,303 | 4,606 | 3,226 | 1,251 |
Financial expenses | (822) | (4,080) | (107) | (1,108) |
Total financial income, net | 11,481 | 526 | 3,119 | 143 |
Income before taxes on income | 23,107 | 13,549 | 6,278 | 3,682 |
Taxes on income | (4,554) | (2,704) | (1,237) | (735) |
Income after taxes on income | 18,553 | 10,845 | 5,041 | 2,947 |
Earnings per share: | ||||
Basic / diluted earnings per share | 1.34 | 0.78 | 0.36 | 0.21 |
Shares used in computation of | 13,867,017 | 13,867,017 | 13,867,017 | 13,867,017 |
Actual number of shares | 13,867,017 | 13,867,017 | 13,867,017 | 13,867,017 |
(*) Convenience translation into
| ||||
G. WILLI-FOOD INTERNATIONAL LTD. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||
Three months ended | Three months ended | |||||
March 31, | March 31, | |||||
2024 | 2023 | 2024 | 2023 | |||
NIS | US dollars (*) | |||||
In thousands (except per share and share data) | ||||||
CASH FLOWS - OPERATING ACTIVITIES | ||||||
Profit from continuing operations | 18,553 | 10,845 | 5,041 | 2,947 | ||
Adjustments to reconcile net profit to net cash from continuing | (14,781) | (31,858) | (4,017) | (8,655) | ||
Net cash from (used in) continuing operating activities | 3,772 | (21,013) | 1,024 | (5,708) | ||
CASH FLOWS - INVESTING ACTIVITIES | ||||||
Acquisition of property plant and equipment | (2,393) | (**) (644) | (650) | (175) | ||
Acquisition of property plant and equipment under construction | (4,321) | (**) (6,167) | (1,174) | (1,675) | ||
Proceeds from sale of marketable securities, net | 623 | 8,493 | 169 | 2,307 | ||
Net cash used in (from) continuing investing activities | (6,091) | 1,682 | (1,655) | 457 | ||
CASH FLOWS - FINANCING ACTIVITIES | ||||||
Lease liability payments | (719) | (493) | (195) | (134) | ||
Net cash used in continuing financing activities | (719) | (493) | (195) | (134) | ||
Decrease in cash and cash equivalents | (3,038) | (19,824) | (826) | (5,385) | ||
Cash and cash equivalents at the beginning of the year | 137,466 | 150,607 | 37,345 | 40,915 | ||
Exchange gains on cash and cash equivalents | 422 | 689 | 115 | 187 | ||
Cash and cash equivalents at the end of the year | 134,850 | 131,472 | 36,634 | 35,717 | ||
(*) Convenience Translation into (**) Reclassified. | ||||||
G. WILLI-FOOD INTERNATIONAL LTD. APPENDIX TO CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
CASH FLOWS – OPERATING ACTIVITIES:
A. Adjustments to reconcile net profit to net cash from continuing operating activities: | ||||
Three months | Three months | |||
ended | ended | |||
March 31, | March 31, | |||
2024 | 2023 | 2024 | 2023 | |
NIS | US dollars (*) | |||
(in thousands) | ||||
Increase (decrease) in deferred income taxes | 1,419 | (535) | 385 | (145) |
Unrealized loss (gain) on marketable securities | (8,047) | 3,024 | (2,186) | 822 |
Depreciation and amortization | 1,849 | 1,625 | 502 | 441 |
Stock based compensation reserve | 200 | 426 | 54 | 116 |
Capital gain on disposal of property plant and equipment | - | (25) | - | (7) |
Exchange gains on cash and cash equivalents | (422) | (689) | (115) | (187) |
Changes in assets and liabilities: | ||||
Decrease (Increase) in trade receivables and other receivables | 7,682 | (11,247) | 2,087 | (3,055) |
Increase in inventories | (12,407) | (23,667) | (3,371) | (6,431) |
Increase (decrease) in trade payables, other payables and | (2,537) | 2,564 | (689) | 697 |
Cash generated from operations | (12,263) | (28,524) | (3,333) | (7,749) |
Income tax paid | (2,518) | (3,334) | (684) | (906) |
Net cash flows used in operating activities | (14,781) | (31,858) | (4,017) | (8,655) |
(*) Convenience Translation into
| ||||
This information is intended to be reviewed in conjunction with the Company's filings with the Securities and | ||||
Company Contact:
G. Willi - Food International Ltd.
Yitschak Barabi, Chief Financial Officer
(+972) 8-932-1000
itsik.b@willi-food.co.il
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SOURCE G. Willi-Food International Ltd.
FAQ
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