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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

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NET PROFIT UP 126.1% IN FIRST HALF 2021 COMPARED TO SAME PERIOD 2020

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.

G. Willi-Food International Ltd. Logo
G. Willi-Food International Ltd. Logo

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-Food, commented: "We are pleased to present strong second quarter 2021 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
through profit or loss

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
through profit or loss

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
respect of defined benefit

(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
Company

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
basic EPS

13,867,017

13,217,017

13,867,017

13,217,017

13,867,017

13,217,017

Shares used in computation of
diluted EPS

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
to (used in) continuing operating activities
(Appendix A)

(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
securities, net

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
activities

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
the financial period

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
financial year

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
income taxes

2,395

(3,382)

1,073

901

735

(1,037)

Unrealized loss (gain) on marketable
securities

(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
plant and equipment

(137)

(58)

(100)

(58)

(42)

(18)

Exchange losses on cash and cash
equivalents

(1,098)

(**) (259)

(852)

(**) 173

(336)

(79)








Changes in assets and liabilities:







Increase (decrease) in trade
receivables and other receivables

(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
payables, and other current liabilities

(4,003)

(5,759)

(8,229)

(5,901)

(1,228)

(1,766)

Net cash flows from operating
activities

(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
information:







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:
G. Willi - Food International Ltd.
Yitschak Barabi, Chief Financial Officer
(+972) 8-932-1000
itsik.b@willi-food.co.il

Cision
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SOURCE G. Willi-Food International Ltd.