G. Willi-Food international Reports the results of first quarter 2024

YAVNE, Israel, May 20, 2024 /PRNewswire/ — G. Willi-Food International Ltd. (NASDAQ: WILC) (the “Company” or “Willi-Food“), a global company that specializes in the development, marketing and international distribution of kosher foods, today announced its unaudited financial results for the first quarter ended March 31, 2024.

First Quarter Fiscal Year 2024

  • Sales decreased by 10.1% to NIS 136.0 million (USD 37.0 million) from NIS 151.4 million (USD 41.1 million) in the first quarter of 2023.
  • Gross profit decreased by 13.5% year-over-year to NIS 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 State of Israel is still at war against the terror organization Hamas, which has created a difficult environment, the Company has continued to conduct its business in the ordinary course, importing goods, maintaining sufficient inventory and selling its goods to its customers. In parallel, the Company is working to improve the commercial terms with its customers and suppliers in order to improve its gross profit and operating profit results. The Company is also continuing the construction of the new logistics center which, in our estimation, after its completion, will contribute significantly to the Company’s logistics capabilities and support continued growth opportunities, both in terms of sales and in improving profit. The construction of the new logistics center is currently expected to be completed by the end of 2025.

First Quarter Fiscal 2024 Summary

Sales for the first quarter of 2024 decreased by 10.1% to NIS 136.0 million (USD 37.0 million) from NIS 151.4 million (USD 41.1 million) recorded in the first quarter of 2023. Sales decreased mainly due to significant delays in the arrival of goods from the Far-East following the closure of the shipping lanes on the Red Sea.

Gross profit for the first quarter of 2024 decreased by 13.5% to NIS 34.7 million (USD 9.4 million), or 25.5% of revenues, from NIS 40.0 million (USD 10.9 million), or 26.5% of revenues, recorded in the first quarter of 2023. The decrease in gross profit and gross margins was mainly due to decreased sales and increased costs of the Company’s imported products and increased shipping costs which the Company didn’t pass on to its clients.

Selling expenses decreased by 17.3% to NIS 16.5 million (USD 4.5 million), or 12.1% of revenues, compared to NIS 19.9 million (USD 5.4 million), or 13.1% of revenues, recorded in the first quarter of 2023. The decrease was mainly due to a decrease in advertising costs. 

General and administrative expenses for the first quarter of 2024 decreased by 8.0% to NIS 6.6 million (USD 1.8 million), or 4.8% of revenues, from NIS 7.1 million (USD 1.9 million), or 4.7% of revenues, recorded in the first quarter of 2023. The decrease in general and administrative expenses was primarily due to a decrease in other management expenses.

Operating profit for the first quarter of 2024 decreased by 10.7% to NIS 11.6 million (USD 3.2 million), or 8.5% of revenues, from NIS 13.0 million (USD 3.5 million), or 8.6% of revenues, recorded in the first quarter of 2023. The decrease in operating profit was primarily due to the decline in sales and increase in cost of sales.

Financial income, net increased to NIS 11.5 million (USD 3.1 million) recorded in the first quarter of 2024 compared to NIS 0.5 million (USD 0.1 million) in the first quarter of 2023. Financial income, net for the first quarter of 2024 comprised mainly from income from revaluation of the Company’s portfolio of securities to fair value in an amount of NIS 7.9 million (USD 2.1 million) and interest and dividend income from the Company’s portfolio of securities in an amount of NIS 3.9 million (USD 1.1 million).

Willi-Food’s income before taxes in the first quarter of 2024 increased to NIS 23.1 million (USD 6.3 million) compared to income before taxes of NIS 13.5 million (USD 3.7 million) in the first quarter of 2023.

Willi-Food’s net profit in the first quarter of 2024 was NIS 18.6 million (USD 5.1 million), or NIS 1.34 (USD 0.36) per share, or 72.2% compared to NIS 10.8 million (USD 2.9 million), or NIS 0.78 (USD 0.21) per share, recorded in the first quarter of 2023. Net profit for the first quarter of 2024 increased by 72.2% year-over-year. The increase in net profit was mainly due to the increase of financial income.

Willi-Food ended the first quarter of 2024 with NIS 244.4 million (USD 66.4 million) in cash and securities. Net cash from continuing activities for the first quarter of 2024 was NIS 3.8 million (USD 1.0 million). Willi-Food’s shareholders’ equity at the end of March 2024 was NIS 561.0 million (USD 152.4 million).

NOTE A: NIS to USD exchange rate used for convenience only
The convenience translation of New Israeli Shekels (NIS) into U.S. dollars was made at the rate of exchange prevailing on March 31, 2024, with U.S. $1.00 equal to NIS 3.681 The translation was made solely for the convenience of the reader.

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 Israel’s leading food importers, Willi-Food markets and sells its food products to over 1,500 customers and 3,000 selling points in Israel and around the world, including large retail and private supermarket chains, wholesalers and institutional consumers. The Company’s operating divisions include Willi-Food in Israel and Euro European Dairies, a wholly owned subsidiary that designs, develops and distributes branded kosher, dairy-food products.

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/U.S. Dollar exchange rate, payment default by any of our major clients, the loss of one of more of our key personnel, changes in laws and regulations, including those relating to the food distribution industry, and inability to meet and maintain regulatory qualifications and approvals for our products, termination of arrangements with our suppliers, loss of one or more of our principal clients, increase or decrease in global purchase prices of food products, increasing levels of competition in Israel and other markets in which we do business, changes in political, economic and military conditions in Israel, particularly the recent war in Israel. Economic conditions in the Company’s core markets, delays and price increases due to the attacks on global shipping routes in the Red Sea, our inability to accurately predict consumption of our products and changes in consumer preferences, our inability to protect our intellectual property rights, our inability to successfully integrate our recent acquisitions, insurance coverage not sufficient enough to cover losses of product liability claims, risks associated with product liability claims and risks associated with the start of credit extension activity. We cannot guarantee future results, levels of activity, performance or achievements. The matters discussed in this press release also involve risks and uncertainties summarized under the heading “Risk Factors” in the Company’s Annual Report on Form 20-F for the year ended December 31, 2023, filed with the Securities and Exchange Commission on March 21, 2024. These factors are updated from time to time through the filing of reports and registration statements with the Securities and Exchange Commission. We do not assume any obligation to update the forward-looking information contained in this press release.

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

profit or loss

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

profit or loss

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

respect of defined benefit

(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

     Company

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 U.S. dollars.

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

     basic/diluted EPS

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 U.S. dollars.

 

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

   operating activities (Appendix A)

(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 U.S. Dollars.

(**)    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

     other current liabilities

(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 U.S. Dollars.

 


This information is intended to be reviewed in conjunction with the Company’s filings with the Securities and

Exchange Commission.

Company Contact:

G. Willi – Food International Ltd.

Yitschak Barabi, Chief Financial Officer

(+972) 8-932-1000

[email protected]

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SOURCE G. Willi-Food International Ltd.


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