YAVNE, Israel, Nov. 27, 2017 /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 third quarter ended September 30, 2017.
Willi-Food's operating divisions include Willi-Food, a
distributor of a broad variety of kosher foods, and its
wholly-owned Gold Frost, a designer, developer and distributor of
branded kosher innovative dairy food products.
Third Quarter Fiscal 2017 Highlights (income statement
highlights compared to same period last year):
- Sales increased 13.3% from third quarter of 2016 to
NIS 80 million (US$ 22.7 million)
- Gross profit increased by 9.8% year-over-year to NIS 20.8 million (US$ 5.9
million).
- Operating profit of NIS 8.2
million (US$ 2.3 million), or
10.3% of sales, compared to operating profit of NIS 4.8 million (US$ 1.4
million) in the comparable quarter of 2016.
- Net profit was NIS 8.2 million
(US$ 2.3 million), or 10.2% of sales,
an increase of 83.4% versus the third quarter of 2016.
- Net cash from operating activities of NIS 31.0 million (US$ 8.8
million).
- Cash and securities balance of NIS 234.3
million (US$ 66.4 million) as
of September 30, 2017.
- Earnings per share of NIS 0.62
(US$ 0.18).
Management Comment
Tim Cranko, CEO of Willi-Food, commented: "We are pleased
to present the third quarter 2017 financial report which shows
improvements in operations and in results. Sales increased 13.3%
versus third quarter 2016, gross profit increased 9.8% and total
operating expenses decreased by 11%, together leading to an
increase in operating profit of 70.1% versus third quarter of 2016.
A major area of focus during the quarter was inventory
optimization. While this is still an area of focus, we are pleased
to report that the level of inventory was reduced by 41.3% from
NIS 70.9 million (US$ 20.1) at the end of second quarter of 2017
to NIS 41.6 million (US$11.8) at the end of the third quarter of
2017. During the third quarter, we began integrating a new senior
management team which initiated the introduction of management
systems, routines and procedures. These management changes and
initiatives allow for organizational stability and provide a solid
basis for enhanced future growth."
Third Quarter Fiscal 2017 Summary
Sales for the third quarter of 2017 increased by 13.3% to
NIS 80.0 million (US$ 22.7 million) from NIS
70.6 million (US$ 20 million)
recorded in the third quarter of 2016. The increase in sales was
primarily due to a strike at the Ministry of Health in the third
quarter of 2016 which limited release of goods from the port and
caused a decrease of NIS 6 million in
sales in the third quarter of 2016 offset by an increase in sales
due to and various sales promotions in the third quarter of
2017.
Gross profit for the third quarter of 2017 increased by 9.8% to
NIS 20.9 million (US$ 5.9 million) compared to NIS 19.0 million (US$ 5.4
million) recorded in the third quarter of 2016. Third
quarter 2017 gross margin decreased by 3% to 26.1% compared to
gross margin of 26.9% for the same period in 2016. The decrease in
gross margin was primarily due to reductions in the prices of
certain of our products as a result of an inventory with a short
expire date that the Company had to sell with lower prices.
Willi-Food's operating profit for the third quarter of 2017
increased by 70.8% to NIS 8.2 million
(US$ 2.3 million) compared to
operating profit of NIS 4.8 million
(US$ 1.4 million) in the third
quarter of 2016. Selling expenses decreased by 12.7% from the
comparable quarter of 2016 primarily due to a decrease in
promotional expenses which was somewhat offset by an increase of
inventory-storage expenses. Selling expenses as a percentage of
sales were 11.6%, compared to 15% in the third quarter of 2016.
General and administrative expenses were NIS 3.3 million (US$ 0.9
million) in the third quarter of 2017, a decrease of 9%
compared to NIS 3.7 million
(US$ 1 million) in third quarter of
2016, mainly due to a decrease in senior management salary.
Willi-Food's income before taxes for the third quarter of 2017
was NIS 10.9 million (US$ 3.1 million) compared to income before taxes
of NIS 5.5 million (US$ 1.5 million) recorded in the third quarter of
2016.
Willi-Food's net profit in the third quarter of 2017 was
NIS 8.2 million (US$ 2.3 million), or NIS
0.62 (US$ 0.17) per share,
compared to NIS 4.5 million
(US$ 1.3 million), or NIS 0.34 (US$ 0.1)
per share, recorded in the third quarter of 2016.
Willi-Food ended the third quarter of 2017 with NIS 234 million (US$ 66
million) in cash and securities. Net cash from operating
activities for the third quarter of 2017 was NIS 31.0 million (US$ 8.7
million). Willi-Food's shareholders' equity at the end of
September 2017 was NIS 404.7 million (US$
114.7 million).
Nine months Fiscal 2017 Highlights (compared to same
period last year)
- Sales increased 4.3% to NIS 239.7
million (US$ 67.9
million).
- Gross profit decreased 6.2% to NIS 57.5
million (US$ 16.2 million), or
24.0% of sales.
- Operating profit decreased 35.8% to NIS
13.2 million (US$ 3.7
million), or 5.5% of sales.
- Net income decreased 17.1% to NIS 14.0
million (US$ 3.9 million), or
5.9% of sales.
- Net cash used for operating activities of NIS 5.3 million (US$ 1.5
million)
- Earning per share of NIS 1.06
(US$ 0.3).
Nine Month Results
Willi-Food's sales for the nine month period ending September 30, 2017 increased by 4.3% to
NIS 239.7 million (US$ 67.9 million) compared to sales of
NIS 229.8 million (US$ 65 million) in nine months of 2016. The
increase in sales was primarily due to a strike at the Ministry of
Health in the third quarter of 2016 which limited release of goods
from the port and caused a decrease of NIS 6
million in sales in the corresponding period last year
offset by an increase in sales due to and various sales promotions
in the third quarter of 2017.
Gross profit for the period decreased by 6.2% to NIS 57.5 million (US$ 16.2
million) compared to gross profit of NIS 61.3 million (US$ 17.3
million) for nine months of 2016. Nine months of 2017 gross
margin was 24.0% compared to a gross margin of 26.6% for the same
period in 2016.
Operating profit for nine months of 2017 decreased by 35.8% to
NIS 13.2 million (US$ 3.7 million) from NIS
20.6 million (US$ 5.8 million)
reported in the comparable period of last year primarily due to the
decrease of gross profit and increase of selling expenses. Nine
months of 2017 income before taxes decreased by 20.1% to
NIS 17.7 million (US$ 5.0 million) compared to NIS 22.1 million (US$ 6.3
million) recorded in the nine months of 2016. Net income for
the nine months of 2017 decreased by 17.1% to NIS 14.0 million (US$ 3.9
million), or NIS 1.06
(US$ 0.30) per share, from
NIS 16.9 million (US$ 4.8 million), or NIS
1.28 (US$ 0.34) per share,
recorded in nine months of 2016.
Note regarding a notice of the end of Exclusive Distribution
Agreement
On October 19, 2017 the Company's
wholly owned subsidiary, Gold Frost Ltd. ("Goldfrost"),
received a notice from its Danish producer of dairy products, Arla
Foods amba ("Arla"), to end their Exclusive Distribution
Agreement effective as of December 31,
2017.
As announced by the Company, the end of the Exclusive
Distribution Agreement with Arla may have a significant negative
impact on the Company's operating results although the Company
believes that it will be able to enter into agreements in the near
future with alternative suppliers for a portion of the products
currently purchased from Arla.
Representatives of the Company's wholly owned subsidiary,
Goldfrost, and representatives of Arla have met several times in
recent weeks and have agreed that Goldfrost may place new orders
for additional dairy products produced by Arla and to be sold by
Goldfrost during the first half of 2018.
Goldfrost intends to continue its communications with Arla.
Note A: Convenience Translation to Dollars
The convenience translation of New Israeli Shekels (NIS) into
U.S. dollars was made at the rate of exchange prevailing on
September 30, 2017, U.S. $1.00 equals NIS
3.529. The translation was made solely for the convenience
of the reader.
Note B: IFRS
The Company's consolidated financial results for the six-month
period ended September 30, 2017 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 1,500
customers 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 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 or 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 and risks associated with
product liability claims. 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, 2016, filed with the
Securities and Exchange Commission on April
27, 2017. 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.
{FINANCIAL TABLES TO FOLLOW}
G. WILLI-FOOD INTERNATIONAL LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
|
September
30,
|
December
31
|
September
30,
|
December
31
|
|
|
2 0 1
7
|
2 0 1
6
|
2 0 1
6
|
2 0 1
7
|
2 0 1
6
|
2 0 1
6
|
|
NIS
|
US dollars
(*)
|
|
(in
thousands)
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
111,350
|
237,613
|
129,577
|
31,553
|
63,228
|
36,718
|
|
Financial assets
carried at fair value through profit or loss
|
122,981
|
14,948
|
104,921
|
34,849
|
3,978
|
29,731
|
|
Trade
receivables
|
95,993
|
83,379
|
80,227
|
27,201
|
22,187
|
22,734
|
|
Other receivables and
prepaid expenses
|
2,621
|
5,263
|
4,795
|
743
|
1,400
|
1,358
|
|
Inventories
|
41,646
|
44,982
|
41,877
|
11,801
|
11,970
|
11,867
|
|
Current tax
assets
|
6,308
|
3,351
|
5,443
|
1,787
|
892
|
1,542
|
|
Total current
assets
|
380,899
|
389,536
|
366,840
|
107,934
|
103,655
|
103,950
|
|
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
|
|
|
Property, plant and
equipment
|
78,315
|
77,116
|
77,204
|
22,192
|
20,520
|
21,877
|
|
Less -Accumulated
depreciation
|
36,530
|
34,024
|
34,963
|
10,351
|
9,054
|
9,907
|
|
41,785
|
43,092
|
42,241
|
11,841
|
11,466
|
11,970
|
|
|
|
|
|
|
|
|
Non current financial
assets
|
-
|
7,900
|
-
|
-
|
2,102
|
-
|
|
Goodwill
|
36
|
36
|
36
|
10
|
10
|
10
|
|
Deferred
taxes
|
1,619
|
2,313
|
2,354
|
459
|
617
|
667
|
|
Total non-current
assets
|
43,440
|
53,341
|
44,631
|
12,310
|
14,195
|
12,647
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
424,339
|
442,877
|
411,471
|
120,244
|
117,850
|
116,597
|
|
|
|
|
|
|
|
|
EQUITY AND
LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
|
Trade
payables
|
10,463
|
21,788
|
14,832
|
2,965
|
5,798
|
4,203
|
|
Employees
Benefits
|
2,117
|
2,335
|
2,253
|
600
|
621
|
638
|
|
Other payables and
accrued expenses
|
5,789
|
1,542
|
2,533
|
1,641
|
410
|
717
|
|
Total current
liabilities
|
18,369
|
25,665
|
19,618
|
5,206
|
6,829
|
5,558
|
|
|
|
|
|
|
|
|
Non-current
liabilities
|
|
|
|
|
|
|
|
retirement benefit
obligation
|
1,212
|
544
|
849
|
343
|
145
|
241
|
|
Total non-current
liabilities
|
1,212
|
544
|
849
|
343
|
145
|
241
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
|
|
|
Share capital NIS 0.1
par value (authorized -
50,000,000 shares, issued and outstanding -
13,240,913 shares at
March 31, 2017; and December 31, 2016)
|
1,424
|
1,424
|
1,424
|
404
|
379
|
404
|
|
Additional paid in
capital
|
128,354
|
128,354
|
128,354
|
36,371
|
34,155
|
36,371
|
|
Capital
fund
|
247
|
247
|
247
|
70
|
66
|
70
|
|
Remeasurement of the
net liability in respect of defined benefit
|
(809)
|
(197)
|
(508)
|
(229)
|
(52)
|
(144)
|
|
Retained
earnings
|
275,542
|
286,840
|
261,487
|
78,079
|
76,328
|
74,097
|
|
Equity
attributable to owners of the Company
|
404,758
|
416,668
|
391,004
|
114,695
|
110,876
|
110,798
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
424,339
|
442,877
|
411,471
|
120,244
|
117,850
|
116,597
|
|
|
|
|
|
|
|
(*) Convenience
translation into U.S. dollars.
G. WILLI-FOOD INTERNATIONAL LTD.
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
|
Nine
months
|
Three
months
|
Nine
months
|
|
ended
|
ended
|
ended
|
|
September
30,
|
September
30,
|
September
30,
|
|
2 0 1
7
|
2 0 1
6
|
2 0 1
7
|
2 0 1
6
|
2 0 1
7
|
2 0 1
6
|
|
NIS
|
US dollars
(*)
|
|
In thousands
(except per share and share data)
|
|
|
|
|
|
|
|
|
Sales
|
239,771
|
229,849
|
80,041
|
70,621
|
67,943
|
61,163
|
|
Cost of
sales
|
182,270
|
168,524
|
59,166
|
51,616
|
51,649
|
44,844
|
|
|
|
|
|
|
|
|
Gross
profit
|
57,501
|
61,325
|
20,875
|
19,005
|
16,294
|
16,319
|
|
|
|
|
|
|
|
|
Operating costs
and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling
expenses
|
32,296
|
29,148
|
9,260
|
10,606
|
9,152
|
7,756
|
|
General and
administrative expenses
|
12,229
|
11,605
|
3,352
|
3,684
|
3,465
|
3,088
|
|
Other
income
|
301
|
112
|
-
|
123
|
85
|
30
|
|
|
|
|
|
|
|
|
Total operating
expenses
|
44,224
|
40,641
|
12,612
|
14,167
|
12,532
|
10,814
|
|
|
|
|
|
|
|
|
Operating
profit
|
13,277
|
20,684
|
8,263
|
4,838
|
3,762
|
5,505
|
|
|
|
|
|
|
|
|
Financial
income
|
7,853
|
3,583
|
2,352
|
2,567
|
2,225
|
954
|
|
Financial expense
(income)
|
3,423
|
2,112
|
(264)
|
1,943
|
970
|
563
|
|
|
|
|
|
|
|
|
Total financial
income
|
4,430
|
1,471
|
2,616
|
624
|
1,255
|
391
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before
taxes on income
|
17,707
|
22,155
|
10,879
|
5,462
|
5,017
|
5,896
|
|
Taxes on
income
|
3,653
|
5,198
|
2,691
|
998
|
1,035
|
1,383
|
|
|
|
|
|
|
|
|
Profit for the
period
|
14,054
|
16,957
|
8,188
|
4,464
|
3,982
|
4,513
|
|
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
Basic earnings per
share
|
1.06
|
1.28
|
0.62
|
0.34
|
0.30
|
0.34
|
|
|
|
|
|
|
|
|
Diluted earnings
per share
|
1.06
|
1.28
|
0.62
|
0.34
|
0.30
|
0.34
|
|
|
|
|
|
|
|
|
Shares used in
computation of
basic EPS
|
13,240,913
|
13,240,913
|
13,240,913
|
13,240,913
|
13,240,913
|
13,240,913
|
|
|
|
|
|
|
|
(*) Convenience
translation into U.S. dollars.
G. WILLI-FOOD INTERNATIONAL LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS
|
Nine
months
|
Three
months
|
Nine
months
|
|
ended
|
ended
|
ended
|
|
September
30,
|
September
30,
|
September
30,
|
|
2 0 1
7
|
2 0 1
6
|
2 0 1
7
|
2 0 1
6
|
2 0 1
7
|
2 0 1
6
|
|
NIS
|
US dollars
(*)
|
|
(in
thousands)
|
|
|
|
|
|
|
|
|
CASH FLOWS -
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
Profit from
continuing operations
|
14,054
|
16,957
|
8,188
|
4,464
|
3,982
|
4,805
|
|
Adjustments to
reconcile net profit to net cash used in continuing operating
activities (Appendix)
|
(19,320)
|
(457)
|
22,817
|
(1,705)
|
(5,474)
|
(127)
|
|
|
|
|
|
|
|
|
Net cash used in
(used to) continuing operating activities
|
(5,266)
|
16,500
|
31,005
|
2,759
|
(1,492)
|
4,678
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS -
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
Acquisition of
property plant and equipment
|
(2,202)
|
(1,828)
|
(609)
|
(147)
|
(624)
|
(518)
|
|
Proceeds from sale of
property plant and Equipment
|
301
|
190
|
-
|
122
|
86
|
54
|
|
Proceeds from
purchase of marketable securities, net
|
(13,228)
|
20,288
|
(9,632)
|
-
|
(3,749)
|
5,749
|
|
Short term
deposit
|
-
|
(8,504)
|
-
|
-
|
-
|
(2,410)
|
|
Proceeds
(acquisition) of non current financial assets
|
2,168
|
131,562
|
1,398
|
70,070
|
614
|
37,279
|
|
|
|
|
|
|
|
|
Net cash from
investing activities
|
(12,961)
|
141,708
|
(8,843)
|
70,045
|
(3,673)
|
40,154
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS -
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
Short-term bank
debt
|
-
|
(16)
|
-
|
-
|
-
|
(5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in
continuing financing activities
|
-
|
(16)
|
-
|
-
|
-
|
(5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase
(decrease) in cash and cash equivalents
|
(18,227)
|
158,192
|
22,162
|
72,804
|
(5,165)
|
44,827
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents at the beginning of the financial
period
|
129,577
|
79,421
|
89,188
|
164,809
|
36,718
|
22,505
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents of the end of the financial year
|
111,350
|
237,613
|
111,350
|
237,613
|
31,553
|
67,332
|
|
|
|
|
|
|
|
(*) Convenience
Translation into U.S. Dollars.
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:
|
Nine
months
|
Three
months
|
Nine
months
|
|
ended
|
ended
|
ended
|
|
September
30,
|
September
30,
|
September
30,
|
|
2 0 1
7
|
2 0 1
6
|
2 0 1
7
|
2 0 1
6
|
2 0
17
|
2 0 1
6
|
|
NIS
|
US dollars
(*)
|
|
(in
thousands)
|
|
|
|
|
|
|
|
|
Decrease in deferred
income taxes
|
735
|
1,301
|
1,509
|
1,022
|
208
|
369
|
|
Unrealized loss
(gain) on marketable securities
|
(4,832)
|
(1,502)
|
(2,804)
|
(2,413)
|
(1,369)
|
(426)
|
|
Unrealized loss
(gain) from non current financial assets
|
-
|
604
|
-
|
399
|
-
|
171
|
|
Depreciation and
amortization
|
2,658
|
2,822
|
868
|
968
|
753
|
800
|
|
Capital loss (gain)
on disposal of property plant and equipment
|
(301)
|
(111)
|
-
|
(122)
|
(86)
|
(31)
|
|
|
|
|
|
|
|
|
Changes in assets
and liabilities:
|
|
|
|
|
|
|
|
Decrease (increase)
in trade receivables and other receivables
|
(16,624)
|
(179)
|
(2,124)
|
5,635
|
(4,709)
|
(51)
|
|
Decrease (increase)
in inventories
|
231
|
(10,465)
|
29,281
|
(11,922)
|
65
|
(2,965)
|
|
Increase (decrease)
in trade and other payables, and other current
liabilities
|
(1,187)
|
7,073
|
(3,913)
|
4,728
|
(336)
|
2,006
|
|
|
|
|
|
|
|
|
(19,320)
|
(457)
|
22,817
|
(1,705)
|
(5,474)
|
(127)
|
|
|
|
|
|
|
|
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.
Tim Cranko, CEO
(+972) 8-932-1000
tim.c@willi-food.co.il
View original
content:http://www.prnewswire.com/news-releases/g-willi-food-international-reports-improvements-in-major-operational-parameters-in-q3-2017-compared-to-q3-2016-300561740.html
SOURCE G. Willi-Food International Ltd.