G. Willi-Food International Reports 9.8% Increase in Sales, and 9.0% Increase in Net Profit in Second Quarter 2021 Compared to Same Period 2020
08/16/2021 - 06:00 AM
YAVNE, Israel , Aug. 16, 2021 /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 second quarter ended June 30, 2021 .
Second Quarter Fiscal Year 2021 Highlights
Sales increased by 9.8% year-over-year to NIS 114.3 million (US$ 35.1 million ). Gross profit decreased by 6.5% year-over-year to NIS 36.9 million (US$ 11.3 million ). Operating profit decreased by 18.8% year-over-year to NIS 13.7 million (US$ 4.2 million ). Total financial income increased by 129.0% year-over-year to NIS 7.6 million (US$ 2.3 million ). Income before taxes increased by 5.6% year-over-year to NIS 21.4 million (US$ 6.6 million ). Net profit increased by 9.0% year-over-year to NIS 16.6 million (US$ 5.1 million ), or 14.5% of sales. Cash and securities balance of NIS 403.0 million (US$ 123.6 million ) as of June 30, 2021 . Earnings per share of NIS 1.2 (US$ 0.37) . Management Comment
Zwi Williger & Joseph Williger , Co-Chairmen of Willi-Food2021 financial results, which show stable growth in the Company's sales and an increase in net profit compared to the same period in 2020. As a result of the Covid-19 pandemic, the world is still experiencing a crisis that is reflecting among other things, in disruptions to international commercial shipping, which has led to an increase in the demand for containers and a significant increase in sea freight and commodity prices.
"Despite the challenging environment, the Company has succeeded to maintain a high level of sales and operational parametres for the second quarter of 2021. The Company's strategy for the near future is to develop new products, enter into new categories with potential of high gross profit margins, improve the visibility of its products in the stores and strengthen its brand, supply chain and sufficient inventory. We believe that our strong performance in the second quarter was driven from our pursuit of these goals. We intend to continue to work to further strengthen the Company's supply chain and product portfolio and maintain sufficient inventory levels in the future to continue to improve our results."
Non-bank credit business activity
After three years in the field of the "non-bank credit business", in light of lack of the company activity in this field the board of directors has decided to terminate this activity and focus only on the Company's core business of developing, marketing and distributing kosher foods.
Second Quarter Fiscal 2021 Summary
Sales for the second quarter of 2021 increased by 9.8% to NIS 114.3 million (US$ 35.1 million ) from NIS 104.2 million (US$ 31.9 million ) recorded in the second quarter of 2020. Revenues increased primarily due to a redirection of resources in favor of sales, increasing the variety of the Company's products, improved inventory management and improving the presence of the Company's line of products on its customers shelves.
Gross profit for the second quarter of 2021 decreased by 6.5% to NIS 36.9 million (US$ 11.3 million ) compared to NIS 39.5 million (US$ 12.1 million ) recorded in the second quarter of 2020. Second quarter gross margin decreased by 14.8% to 32.3% compared to gross margin of 37.9% for the same period in 2020. The decrease in gross profit was mainly due to increase costs of the Company's imported products, increased shipping costs and one-time credits received from suppliers in the second quarter of 2020.
Selling expenses increased by 7.5% to NIS 17.4 million (US$ 5.3 million ) compared to NIS 16.2 million (US$ 5.0 million ) in the second quarter of 2020 primarily due to an increase in payroll expenses in the logistics and sales departments and an increase of transportation of products to the Company's customers to support sales growth.
General and administrative expenses decreased by 9.0% to NIS 5.9 million (US$ 1.8 million ) compared to NIS 6.5 million (US$ 2.0 million ) in the second quarter of 2020.
As a result of the foregoing, operating profit for the second quarter of 2021 decreased by 18.8% to NIS 13.7 million (US$ 4.2 million ) compared to NIS 16.9 million (US$ 5.2 million ) in the second quarter of 2020.
Financial income, net totaled NIS 7.6 million (USD$ 2.3 million ) compared to Financial income, net of NIS 3.3 million (US$ 1.0 million ) in the second quarter of 2020. Financial income, net for the second quarter of 2021 comprised mainly of interest and dividend income from the Company's portfolio of securities in the amount of NIS 4.7 million (US$ 1.4 million ), income from revaluation of the Company's portfolio of securities to fair value in the amount of NIS 3.3 million (US$ 1.0 million ) and management fee of the Company's portfolio of securities expenses in the amount of NIS 0.4 million (US$ 0.1 million ).
Income before taxes on income for the second quarter of 2021 was NIS 21.4 million (US$ 6.6 million ) compared to income before taxes on income of NIS 20.2 million (US$ 6.2 million ) in the second quarter of 2020.
Net profit in the second quarter of 2021 was NIS 16.6 million (US$ 5.1 million ), or NIS 1.2 (US$ 0.37) per share, compared to NIS 15.2 million (US$ 4.7 million ), or NIS 1.15 (US$ 0.35) per share, recorded in the second quarter of 2020.
Willi-Food ended the second quarter of 2021 with NIS 403.0 million (US$ 123.6 million ) in cash and securities. Net cash from operating activities for the second quarter of 2021 was NIS 19.0 million (US$ 5.8 million ). Willi-Food's shareholders' equity at the end of June 2021 was NIS 622.8 million (US$ 191.0 million ).
First Half Fiscal 2021 Highlights
Sales decreased by 0.9% year-over-year to NIS 231.1 million (US$ 70.9 million ). Gross profit decreased by 9.7% year-over-year to NIS 73.2 million (US$ 22.4 million ). Operating profit decreased by 19.9% year-over-year to NIS 28.8 million (US$ 8.8 million ). Total financial income increased by 235.9% year-over-year to NIS 19.2 million (US$ 5.9 million ). Income before taxes increased by 119.6% year-over-year to NIS 47.9 million (US$ 14.7 million ). Net profit increased by 126.1% to NIS 37.1 million (US$ 11.4 million ), or 16% of sales. Basic earnings per share of NIS 2.67 (US$ 0.82) . First Half Fiscal 2021 Summary
Sales for the six-month period ending June 30, 2021 decreased by 0.9% to NIS 231.1 million (US$ 70.9 million ) compared to sales of NIS 233.3 million (US$ 71.6 million ) in the first half of 2020. The decrease in the Company's sales are primarily due to the outbreak of Covid 19 in the first quarter of 2020 which led to significant increase demand for the Company's line of products, especially in the retail chains.
Gross profit for the period decreased by 9.7% to NIS 73.2 million (US$ 22.4 million ) compared to gross profit of NIS 81.0 million (US$ 24.9 million ) for the first half of 2020. First half 2021 gross margin was 31.7% compared to a gross margin of 34.7% for the same period in 2020. The decrease in gross profit was mainly due to increase costs of the Company's imported products, increase in shipping costs and one time credits received from suppliers.
Operating profit for the first half of 2021 decreased by 19.9% to NIS 28.8 million (US$ 8.8 million ) from NIS 35.9 million (US$ 11.0 million ) reported in the comparable period of last year primarily due to the decrease of gross profit.
Financial income, net totaled NIS 19.2 million (USD$ 5.9 million ) compared to Financial expense, net of NIS 14.1 million (US$ 4.3 million ) in the first half of 2020. Financial income, net for the first half of 2021 comprised mainly from interest and dividend income from the Company's portfolio of securities in the amount of NIS 6.3 million (US$ 1.9 million ), income from revaluation of the Company's portfolio of securities to fair value in the amount of NIS 11.9 million (US$ 3.6 million ) and management fee of the Company's portfolio of securities expenses in the amount of NIS 0.5 million (US$ 0.1 million ).
Financial expenses in the first half of 2021 resulted mainly from the outbreak of COVID-19 pandemic which led to capital markets sharp declines and, as a result, the Company suffered a decline in its portfolio of securities.
Income before taxes for the first half 2021 increased by 119.6% to NIS 47.9 million (US$ 14.7 million ) compared to NIS 21.8 million (US$ 6.7 million ) recorded in the first half of 2020.
Net profit for the first half of 2021 increased by 126.1% to NIS 37.1 million (US$ 11.4 million ), or NIS 2.67 (US$ 0.82) per share, from NIS 16.4 million (US$ 5.0 million ), or NIS 1.24 (US$ 0.38) per share, recorded in the first half of 2020.
NOTE A: NIS to US$ 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 June 30, 2021 , U.S. $1.00 equals NIS 3.26 . The translation was made solely for the convenience of the reader.
NOTE B: IFRS
The Company's consolidated financial results for the three-month and six-month period ended June 30, 2021 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 600 food products worldwide. As one of Israel's leading food importers, Willi-Food markets and sells its food products to over 1,250 customers and 2,500 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 Europian Dairies (Gold Frost), a wholly owned subsidiary who 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 and expected sales, operating results, and earnings. 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: 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 economic conditions in Israel , including in particular economic conditions in the Company's core markets, 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, 2020 , filed with the Securities and Exchange Commission on March 25, 2021 . 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
June 30,
December 31
June 30,
December 31
2 0 2 1
2 0 2 0
2 0 2 0
2 0 2 1
2 0 2 0
2 0 2 0
NIS
US dollars (*)
(in thousands)
ASSETS
Current assets
Cash and cash equivalents
255,510
168,689
201,822
78,377
51,745
61,909
Financial assets carried at fair value
147,442
113,468
154,700
45,228
34,806
47,454
Trade receivables
133,369
140,581
131,301
40,911
43,123
40,276
Loans to others
-
3,650
18,707
-
1,120
5,738
Other receivables and prepaid expenses
6,268
6,516
6,667
1,923
1,999
2,045
Inventories
58,463
61,262
59,514
17,933
18,792
18,257
Current tax assets
5,334
-
3,965
1,636
-
1,216
Total current assets
606,386
494,166
576,676
186,008
151,585
176,895
Non-current assets
Property, plant and equipment
86,737
82,138
83,105
26,606
25,196
25,492
Less -Accumulated depreciation
48,538
45,723
46,460
14,889
14,026
14,251
38,199
36,415
36,645
11,717
11,170
11,241
Right of use asset
5,155
3,382
2,866
1,581
1,037
879
Financial assets carried at fair value
17,916
9,273
13,700
5,496
2,845
4,202
Goodwill
36
36
36
11
11
11
Deferred taxes
-
4,200
-
-
1,288
-
Total non-current assets
61,306
53,306
53,247
18,805
16,351
16,333
667,692
547,472
629,923
204,813
167,936
193,228
EQUITY AND LIABILITIES
Current liabilities
Current maturities of lease liabilities
1,516
1,593
1,393
465
489
427
Trade payables
21,256
20,049
23,474
6,520
6,150
7,201
Employees Benefits
3,816
3,410
3,437
1,171
1,046
1,054
Current tax liabilities
-
1,448
-
-
444
-
Other payables and accrued expenses
9,480
9,728
11,611
2,908
2,984
3,562
Total current liabilities
36,068
36,228
39,915
11,064
11,113
12,244
Non-current liabilities
Lease liabilities
3,776
1,896
1,592
1,158
581
488
Deferred taxes
3,163
-
768
970
-
236
Retirement benefit obligation
1,872
1,596
1,905
574
490
584
Total non-current liabilities
8,811
3,492
4,265
2,702
1,071
1,308
Shareholders' equity
Share capital
1,490
1,425
1,490
457
437
457
Additional paid in capital
170,760
128,354
170,760
52,380
39,372
52,380
Capital fund
247
247
247
76
76
76
Treasury shares
(628)
(628)
(628)
(193)
(193)
(193)
Remeasurement of the net liability in
(1,322)
(1,029)
(1,322)
(406)
(316)
(406)
Retained earnings
452,266
379,383
415,196
138,733
116,376
127,362
Equity attributable to owners of the
622,813
507,752
585,743
191,047
155,752
179,676
667,692
547,472
629,923
204,813
167,936
193,228
(*) Convenience translation into U.S. dollars.
G. WILLI-FOOD INTERNATIONAL LTD.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Six months
Three months
Six months
ended
ended
ended
June 30,
June 30,
June 30,
2 0 2 1
2 0 2 0
2 0 2 1
2 0 2 0
2 0 2 1
2 0 2 0
NIS
US dollars (*)
In thousands (except per share and share data)
Sales
231,057
233,255
114,347
104,152
70,876
71,551
Cost of sales
157,897
152,232
77,422
64,651
48,435
46,697
Gross profit
73,160
81,023
36,925
39,501
22,441
24,854
Operating costs and expenses:
Selling expenses
32,771
32,822
17,428
16,205
10,052
10,068
General and administrative expenses
11,764
12,340
5,880
6,464
3,609
3,785
Other income
137
58
100
58
42
18
Total operating expenses
44,398
45,104
23,208
22,611
13,619
13,835
Operating profit
28,762
35,919
13,717
16,890
8,822
11,019
Financial income
19,910
2,580
8,183
3,743
6,107
791
Financial expense
(758)
(16,677)
(537)
(404)
(232)
(5,116)
Total financial income (expense)
19,152
(14,097)
7,646
3,339
5,875
(4,325)
Income before taxes on income
47,914
21,822
21,363
20,229
14,697
6,694
Taxes on income
(10,844)
(5,425)
(4,774)
(5,015)
(3,326)
(1,664)
Profit for the period
37,070
16,397
16,589
15,214
11,371
5,030
Earnings per share:
Basic earnings per share
2.67
1.24
1.2
1.15
0.82
0.38
Diluted earnings per share
2.55
1.24
1.14
1.15
0.78
0.38
Shares used in computation of
13,867,017
13,217,017
13,867,017
13,217,017
13,867,017
13,217,017
Shares used in computation of
14,517,017
13,217,017
14,517,017
13,217,017
14,517,017
13,217,017
Actual number of shares
13,867,017
13,217,017
13,867,017
13,217,017
13,867,017
13,217,017
(*) Convenience translation into U.S. dollars.
G. WILLI-FOOD INTERNATIONAL LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Six months
Three months
Six months
ended
ended
ended
June 30,
June 30,
June 30,
2 0 2 1
2 0 2 0
2 0 2 1
2 0 2 0
2 0 2 1
2 0 2 0
NIS
US dollars (*)
(in thousands)
CASH FLOWS - OPERATING ACTIVITIES
Profit from continuing operations
37,070
16,397
16,589
15,214
11,371
5,030
Adjustments to reconcile net profit to net cash used
(13,848)
(**)15,151
2,402
(**)8,800
(4,248)
4,647
Net cash used in continuing operating activities
23,222
31,548
18,991
24,014
7,123
9,677
CASH FLOWS - INVESTING ACTIVITIES
Acquisition of property plant and equipment
(3,633)
(736)
(2,289)
(374)
(1,114)
(225)
Proceeds from sale (purchase) of marketable
15,161
2,528
8,365
10,528
4,651
775
Proceeds from sale of property plant and equipment
137
58
100
58
42
18
Proceeds from loans granted to others
18,707
14,000
11,215
14,000
5,738
4,295
Net cash used in (used to) continuing investing
30,372
15,850
17,391
24,212
9,317
4,863
CASH FLOWS - FINANCING ACTIVITIES
Lease liability payments
(1,004)
(828)
(532)
(404)
(308)
(254)
Net cash used in continuing financing activities
(1,004)
(828)
(532)
(404)
(308)
(254)
Increase (decrease) in cash and cash equivalents
52,590
(**)46,570
35,850
(**)47,822
16,132
14,286
Cash and cash equivalents at the beginning of
201,822
121,860
218,808
121,040
61,909
37,380
Exchange losses on cash and cash equivalents
1,098
(**)259
852
(**)(173)
336
79
Cash and cash equivalents of the end of the
255,510
168,689
255,510
168,689
78,377
51,745
(*) 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 operating activities:
Six months
Three months
Six months
ended
ended
ended
June 30,
June 30,
June 30,
2 0 2 1
2 0 2 0
2 0 2 1
2 0 2 0
2 0 2 1
2 0 2 0
NIS
US dollars (*)
(in thousands)
Decrease (increase) in deferred
2,395
(3,382)
1,073
901
735
(1,037)
Unrealized loss (gain) on marketable
(12,119)
16,272
(3,276)
(2,433)
(3,717)
4,991
Depreciation and amortization
3,101
2,751
1,622
1,398
950
844
Capital gain on disposal of property
(137)
(58)
(100)
(58)
(42)
(18)
Exchange losses on cash and cash
(1,098)
(**) (259)
(852)
(**) 173
(336)
(79)
Changes in assets and liabilities:
Increase (decrease) in trade
(3,038)
(4,700)
8,276
19,991
(932)
(1,443)
Decrease (increase) in inventories
1,051
10,286
3,888
(5,271)
322
3,155
Increase (decrease) in trade and other
(4,003)
(5,759)
(8,229)
(5,901)
(1,228)
(1,766)
Net cash flows from operating
(13,848)
15,151
2,402
8,800
(4,248)
4,647
B. Significant non-cash transactions:
Six months
Three months
Six months
ended
ended
ended
June 30,
June 30,
June 30,
2 0 21
2 0 20
2 0 21
2 0 20
2 0 21
2 0 20
NIS
US dollars (*)
(in thousands)
Supplemental cash flow
Income tax paid
9,758
11,060
4,866
4,580
2,993
3,393
(*) Convenience Translation into U.S. Dollars.
(**) Reclassified
This information is intended to be reviewed in conjunction with the Company's filings with the Securities and Exchange Commission.
Company Contact:Yitschak Barabi , Chief Financial Officeritsik.b@willi-food.co.il
https://www.prnewswire.com/news-releases/g-willi-food-international-reports-9-8-increase-in-sales-and-9-0-increase-in-net-profit-in-second-quarter-2021-compared-to-same-period-2020--301355668.html
SOURCE G. Willi-Food International Ltd.
