G. Willi-Food Reports Q3 2012 Net Income up 179% from Q3 2011
YAVNE, Israel, November 28, 2012 /PRNewswire/ --
G. Willi-Food International Ltd. (NASDAQ: WILC) (the "Company" or "Willi-Food"), a global company specializing in the development, marketing and international distribution of kosher foods, today announced its unaudited financial results for the third quarter and the nine-months ended September 30, 2012.
Third Quarter Fiscal 2012 Highlights
- Sales increased 8.0% from third quarter of 2011 to NIS 70.1 million (US$ 17.9 million)
- Gross profit increased 5.4% from third quarter of 2011 to NIS 16.3 million (US$ 4.2 million), or 23.2% of sales
- Operating income increased 34.7% from third quarter of 2011 to NIS 5.7 million (US$ 1.5 million), or 8.1% of sales
- Net income increased 179.1% from third quarter of 2011 to NIS 6.3 million (US$ 1.6 million), or 9.0% of sales
- Cash and securities balance of NIS 216.1 million (US$ 55.2 million) as of September 30, 2012
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 dairy food products.
Third Quarter Fiscal 2012 Summary
Sales for the third quarter of 2012 increased by 8.0% to NIS 70.1 million (US$ 17.9 million) from NIS 64.9 million (US$ 16.6 million) recorded in the third quarter of 2011. The increase in sales in the third quarter of 2012 was mostly driven by the introduction of new products in the third quarter and the increased awareness of the Company's new products following increased sales activities initiated during the past year.
Gross profit for the third quarter of 2012 increased by 5.4% to NIS 16.3 million (US$ 4.2 million) compared to NIS 15.4 million (US$ 3.9 million) recorded in the third quarter of 2011. Third quarter gross margin was 23.2% compared to gross margin of 23.8% for the same period in 2011. The decrease in gross margins was primarily due to the continued pressure from our customers to reduce prices as a result of the ongoing national protest against the cost of food products.
Willi-Food's operating income for the third quarter of 2012 increased by 34.7% to NIS 5.7 million (US$ 1.5 million) compared to NIS 4.2 million (US$ 1.1 million) recorded in the third quarter of 2011. Selling expenses decreased by 7.3% from the comparable quarter of 2011, primarily due to a decrease in vehicles and transport expenses. Selling expenses as a percentage of sales decreased in the third quarter of 2012 to 9.7% compared to 11.3% in the third quarter of 2011. General and administrative expenses increased by 1.3% from the comparable quarter of 2011, primarily due to an increase in management profit-related bonuses. General and administrative expenses as a percentage of sales decreased in the third quarter of 2012 to 5.5% from 5.9% in the third quarter of 2011.
Willi-Food's income before taxes for the third quarter of 2012 increased by 125.4% to NIS 8.1 million (US$ 2.1 million) compared to NIS 3.6 million (US$ 0.9 million) recorded in the third quarter of 2011. Willi-Food's profit from continuing operations for the third quarter of 2012 increased by 157.5% to NIS 6.3 million (US$ 1.6 million) from NIS 2.4 million (US$ 0.6 million) recorded in the third quarter of 2011.
Willi-Food's net income in the third quarter of 2012 increased by 179.1% to NIS 6.3 million (US$ 1.6 million) from NIS 2.3 million (US$ 0.6 million) recorded in the third quarter of 2011. Willi-Food's net income attributed to the owners of the Company in the third quarter of 2012 increased by 168.2% to NIS 6.3 million (US$ 1.6 million), or NIS 0.49 (US$ 0.13) per share, compared to NIS 2.3 million (US$ 0.6 million), or NIS 0.17 (US$ 0.04) per share, recorded in the third quarter of 2011.
Willi-Food generated NIS 12.6 million (US$ 3.2 million), or NIS 0.97 (US$ 0.25) per share from continuing operating activities in the third quarter of 2012.
Willi-Food ended the third quarter of 2012 with NIS 216.1 million (US$ 55.2 million) in cash and securities and with no short-term debt. Willi-Food's shareholders' equity at the end of September 2012 was NIS 324.9 million (US$ 83.0 million).
Nine-Month Results
Willi-Food's sales for the nine-month period ending September 30, 2012 increased by 2.3% to NIS 210.1 million (US$ 53.7 million) compared to sales of NIS 205.4 million (US$ 52.5 million) in the first nine-month of 2011. Gross profit for the period decreased by 10.9% to NIS 48.5 million (US$ 12.4 million) compared to gross profit of NIS 54.4 million (US$ 13.9 million) for the nine-month period in 2011. First nine-month gross margins in 2012 were 23.1% compared to gross margins of 26.5% in the same period of 2011.
Operating income for the first nine months of 2012 decreased by 24.8% to NIS 16.0 million (US$ 4.1 million) from NIS 21.2 million (US$ 5.4 million) reported in the comparable period of last year. Income before taxes for the first nine months of 2012 increased by 0.9% to NIS 20.1 million (US$ 5.1 million) compared to NIS 19.9 million (US$ 5.1 million) recorded in the first nine months of 2011. Net income for the first nine months of 2012 decreased by 3.2% to NIS 15.2 million (US$ 3.9 million) from NIS 15.7 million (US$ 4.0 million) in the first nine months of 2011. Net income attributable to the owners of the Company for the first nine months of 2012 decreased by 0.9% to NIS 15.2 million (US$ 3.9 million), or NIS 1.17 (US$ 0.30) per share compared to net income attributable to the owners of the Company for the first nine months of 2011 of NIS 15.4 million (US$ 3.9 million), or NIS 1.13 (US$ 0.29) per share.
Business Outlook
Mr. Zwi Williger, Chairman of Willi-Food commented, "We are pleased with our overall performance and our third quarter 2012 results, especially in the current challenging environment of increased competition resulting from customer demand to reduce prices despite the global inflation in the purchase prices of food commodities . We grew sales and gross profits while controlling SG&A expense growth. Third quarter operating income increased by nearly 35% and net income increased by nearly 180%, despite pressure imposed on the Company by the supermarket chains to reduce prices and despite the well-known pressures in commodity costs inflicted worldwide. Throughout 2011 and 2012 we have introduced great-tasting, higher margin food products developed together with our suppliers. We implemented our plan to increase the awareness to our newly added products, by initiating promotion and hard sale activities that we believe created broad awareness to our new and old products and broaden our customer base. This plan has helped us achieve our goals to strengthen our position in the market, due to our broad range of quality food products."
Mr. Williger concluded, "Looking forward, we are confident that we can deliver sales and profit growth in the fourth quarter of 2012 and in 2013 compared to the comparable periods. The fourth quarter of 2012 is off to a good start, and we believe that the positive momentum will continue in recently introduced products, and that several new product line introductions can further boost sales. We are understandably cautious regarding ongoing global commodity price inflation and the impact of the ongoing national protest against the cost of food products, but we believe we are well-positioned to limit any impacts. We will sustain our flexible purchasing strategy and are highly focused on reducing production costs and SG&A expenses. We continue to look for opportunities to create additional value for our shareholders."
Conference Call
The Company will host a conference call to discuss results on Wednesday, November 28, 2012 at 10:00 AM Eastern time. Interested parties may participate in the conference call by dialing 1-877-941-2068 (US), or 1-480-629-9712 (International), approximately 10 minutes prior to the scheduled start time. Interested parties can also listen via a live Internet webcast, which will be available on the day of the call through the following link:
http://public.viavid.com/index.php?id=102717
A replay of the conference call will be available for 14 days from 1:00 PM EST on November 28, 2012 through 11:59 PM EST on December 12, 2012 by dialing 1-877-870-5176 (US), or 1-858-384-5517 (International), access code 4577670. In addition, a recording of the call will be available via the following link for one year:
http://public.viavid.com/reports/eventparticipantreporttab.php?id=o5akppie
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, 2012, U.S. $1.00 equals NIS 3.912. 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 nine-month ended September 30, 2012 are presented in accordance with International Financial Reporting Standards ("IFRS").
NOTE C: Discontinued Operations
Discontinued operations are measured and presented in accordance with the provisions of IFRS 5 "Non-current Assets Held for Sale and Discontinued Operations". The results of discontinued operations are presented in the income statement in a separate item below income from continuing operations.
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.
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, in particular Arla Foods, 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, 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, 2011, filed with the Securities and Exchange Commission on April 30, 2012 and its amendment, filed with the Securities and Exchange Commission on August 30, 2012. 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 December September December
30, 31, 30, 31,
2012 2011 2012 2011
NIS US dollars (*)
(in thousands)
ASSETS
Current assets
Cash and cash equivalents 65,558 34,661 16,758 8,860
Financial assets carried at
fair value through profit
or loss 150,546 163,430 38,483 41,777
Trade receivables 63,767 57,628 16,300 14,731
Other receivables and
prepaid expenses 6,175 15,720 1,578 4,018
Inventories 28,265 32,613 7,225 8,337
Total current assets 314,311 304,052 80,344 77,723
Non-current assets
Property, plant and
equipment 62,056 61,401 15,863 15,696
Less -Accumulated
depreciation 20,756 18,856 5,306 4,820
41,300 42,545 10,557 10,876
Prepaid expenses 117 117 31 31
Goodwill 36 36 9 9
Deferred taxes 1,130 933 289 238
Total non-current assets 42,583 43,631 10,886 11,154
356,894 347,683 91,230 88,877
EQUITY AND LIABILITIES
Current liabilities
Trade payables 24,527 25,683 6,270 6,565
Employees Benefits 1,602 1,613 410 412
Accruals 833 1,164 213 298
Current tax liabilities 95 3,837 24 981
Other payables and accrued
expenses 4,535 4,551 1,159 1,163
Total current liabilities 31,592 36,848 8,076 9,419
Non-current liabilities
Retirement benefit
obligation 447 518 114 132
Total non-current
liabilities 447 518 114 132
Shareholders' equity
Share capital NIS 0.10 par
value 1,444 1,444 369 369
(authorized - 50,000,000
shares, issued
and outstanding -
12,974,245 shares at
September 30, 2012;
13,020,360 shares at
December 31, 2011)
Additional paid in capital 129,875 129,809 33,199 33,182
Capital fund 247 247 63 63
Foreign currency
translation reserve 541 587 138 152
Retained earnings 203,591 188,371 52,043 48,152
Treasury shares (10,843) (10,141) (2,772) (2,592)
324,855 310,317 83,040 79,326
356,894 347,683 91,230 88,877
(*) Convenience translation into U.S. dollars
G. WILLI-FOOD INTERNATIONAL LTD.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Nine-months Three months Nine-months
ended September 30, ended September 30,
2012 2011 2012 2011 2012 2011
NIS US dollars (*)
In thousands (except per share and share data)
Sales 210,111 205,433 70,127 64,905 53,709 52,514
Cost of sales 161,640 51,0291 53,876 49,486 41,319 38,607
Gross profit 48,471 54,404 16,251 15,419 12,390 13,907
Selling
expenses 20,684 20,331 6,801 7,338 5,287 5,197
General and
administrative
expenses 11,991 13,053 3,882 3,834 3,065 3,337
Other income (160) (186) (113) 29 (41) (48)
Total operating
expenses 32,515 33,198 10,570 11,201 8,311 8,486
Operating
income 15,956 21,206 5,681 4,218 4,079 5,421
Financial
income 4,432 (940) 2,698 (580) 1,133 (240)
Financial
expense 293 350 238 26 75 90
Total financial
income
(expenses) 4,139 (1,290) 2,460 (606) 1,058 (330)
Income before
taxes on income 20,095 19,916 8,141 3,612 5,137 5,091
Taxes on income 4,875 4,931 1,848 1,168 1,246 1,260
Income from
continuing
operations 15,220 14,985 6,293 2,444 3,891 3,831
Income from
discontinued
operations - 743 - (189) - 190
Net income 15,220 15,728 6,293 2,255 3,891 4,021
Owners of the
Company 15,220 15,363 6,293 2,346 3,891 3,928
Non-controlling
interest - 365 - (91) - 93
Net income 15,220 15,728 6,293 2,255 3,891 4,021
Earnings per
share data:
Earnings per
share:
Basic from
continuing
operations 1.17 1.10 0.49 0.18 0.30 0.28
Basic from
discontinued
operations - 0.03 - (0.01) - 0.01
Basic 1.17 1.13 0.49 0.17 0.30 0.29
Diluted from
continuing
operations 1.17 1.10 0.49 0.18 0.30 0.28
Diluted from
discontinued
operations - 0.03 - (0.01) - 0.01
Diluted 1.17 1.13 0.49 0.17 0.30 0.29
Shares used in
computing basic
and diluted
earnings per
ordinary share: 12,978,723 13,573,679 12,974,245 13,573,679 12,978,723 13,573,679
(*) Convenience translation into U.S. dollars
G. WILLI-FOOD INTERNATIONAL LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine-months Three months Nine-months
ended September 30, ended September 30,
2012 2011 2012 2011 2012 2011
NIS US dollars (*)
(in thousands)
CASH FLOWS -
OPERATING
ACTIVITIES
Profit from
continuing
operations 15,220 14,985 6,293 2,444 3,891 3,831
Adjustments to
reconcile net
income to net
cash provided
by operating
activities: (8,889) 2,469 6,303 5,054 (2,272) 631
Net cash from
continuing
operating
activities 6,331 17,454 12,596 7,498 1,619 4,462
Net cash from
discontinued
operating
activities - 2,345 - 2,093 - 599
CASH FLOWS -
INVESTING
ACTIVITIES
Long term
deposit, net - (47) - 3 - (12)
Acquisition of
property plant
and equipment (1,247) (456) (1,048) (101) (319) (117)
Proceeds from
sale of
property plant
and Equipment 698 216 656 2 178 55
Proceeds from
disposal of
subsidiary 13,500 - - - 3,451 -
Proceeds from
(used in)
purchase of
marketable
securities,
net 12,317 (106,949) (19,450) (48,347) 3,149 (27,339)
Net cash from
(used in)
continuing
investing
activities 25,268 (107,236) (19,842) (48,443) 6,459 (27,413)
Net cash used
in
discontinued
investing
activities - (1,787) - (518) - (457)
CASH FLOWS -
FINANCING
ACTIVITIES
Investment
used in
treasury
stocks (702) - - - (180) -
Net cash used
in continuing
financing
activities (702) - - - (180) -
Net cash from
(used in)
discontinued
financing
activities - 459 - (1,445) - 118
Increase
(decrease) in
cash and cash
equivalents 30,897 (88,765) (7,246) (40,815) 7,898 (22,691)
Cash and cash
equivalents at
the beginning
of the
financial
period 34,661 113,631 72,804 65,681 8,860 29,047
Cash and cash
equivalents of
the end of the
financial
period 65,558 24,866 65,558 24,866 16,758 6,356
(*) Convenience Translation into U.S. Dollars.
G. WILLI-FOOD INTERNATIONAL LTD.
APPENDIX TO CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine-months Three months Nine-months
Ended
Ended September 30, September 30,
2012 2011 2012 2011 2012 2011
US dollars
NIS (*)
(in thousands)
Adjustments to
reconcile net
income to net
cash from
operating
activities
Depreciation and
amortization 1,894 2,376 (77) 789 484 607
Deferred income
taxes (197) (1,259) 55 (140) (49) (322)
Capital Gain
(Loss) on
disposal of
property plant
and equipment (100) (187) (40) 27 (26) (48)
Unrealized Gain
(loss) on
marketable
securities 567 5,482 (161) 2,188 145 1,401
Stock based
compensation
reserve 66 - 19 - 17 -
Employees
benefit, net (71) (5) 18 (5) (18) (1)
Changes in assets
and liabilities:
Decrease
(Increase) in
trade receivables
and other
receivables (10,140) 1,326 1,058 4,242 (2,592) 339
Decrease
(Increase) in
inventories 4,348 (5,957) 4,716 (1,651) 1,111 (1,523)
Increase
(Decrease) in
payables and
other current
liabilities (5,256) 693 715 (396) (1,344) 178
(8,889) 2,469 6,303 5,054 (2,272) 631
(*) 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.
Raviv Segal, CFO
(+972) 8-932-1000
[email protected]
SOURCE G. Willi-Food International Ltd.
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