PR Newswire | Mar 25, 2021 06:03AM EDT

Profit Parameters

03/25 05:02 CDT

G. Willi-Food International Reports a Record High Year With Sales, and All Profit ParametersFISCAL YEAR 2020 RESULTS SHOW HIGHEST EVER YEAR FOR THE COMPANY IN SALES, GROSS PROFIT, OPERATING PROFIT, PROFIT BEFORE TAX AND NET PROFIT YAVNE, Israel, March 25, 2021

YAVNE, Israel, March 25, 2021 /PRNewswire/ -- G. Willi-Food International Ltd.(NASDAQ: WILC) (TASE: WILF) (the "Company" or "Willi-Food"), a global company that specializes in the development, marketing and international distribution of kosher foods, today announced its financial results for the fiscal year ended December 31, 2020.

Fiscal Year 2020 Highlights

* Sales increased by 14.8% from fiscal year 2019 to NIS 454.1 million (US$ 141.2 million). * Gross profit increased by 17.4% from fiscal year 2019 to NIS 145.4 million (US$ 45.2 million), or 32% of sales. * Operating profit increased by 21.7% from fiscal year 2019 to NIS 57.6 million (US$ 17.9 million). * Profit before tax increased by 3.7% from fiscal year 2019 to NIS 67.7 million (US$ 21.1 million). * Cash and securities balance of NIS 356.5 million (US$ 110.9 million) as of December 31, 2020.

Management Comment

Zwi Williger & Joseph Williger, Co-Chairmen of Willi-Food, commented: "We are very pleased to present our fiscal year 2020 financial results which show our highest ever sales, gross profit, operating profit, profit before tax and net profit. Since almost the beginning of fiscal year 2020, the Company has been operating in the COVID-19 pandemic environment, which has led to changes in consumption habits of consumers in parallel with various restrictions imposed on the public. Despite this difficult environment, the Company managed to deliver a record performance with sales and all profit parameters. We believe this performance was driven in part by following our strategy of developing new and profitable products, entering into new categories, improving our visibility in the stores and strengthening our supply chain. We intend to continue to work hard to achieve the goals we have set for the Company over the next few years, and we believe that with our excellent management team we will meet those objectives."

According to retail data analytics provided by StoreNext Ltd[1], the Company recorded a higher growth rate in 2020 for "sale out" sales (i.e., sales to the final consumer) than any other Israeli food and beverage company, growing 25.9% compared to the 9.3% average growth of such companies.

Fiscal 2020 Summary

Revenues for fiscal year 2020 increased by NIS 58.5 million (USD 18.2 million), or 14.8%, to NIS 454.1 million (USD 141.2 million) from NIS 395.6 million (USD 123.1 million) recorded in fiscal year 2019. Revenues increased primarily due to the COVID-19 pandemic, which led to an increase in demand for the Company's line of products, primarily in retail chains, and due to a redirection of resources in favor of sales, increasing the variety of the Company's products, improving the company visibility in the stores and improved inventory management.

Cost of sales for fiscal year 2020 increased by 13.6% to NIS 308.7 million (USD 96.0 million), or 68.0% of revenues, from NIS 271.8 million (USD 84.5 million), or 68.7% of revenues, recorded in fiscal year 2019. The increase in cost of sales was primary due to increase in sales.

Gross profit for fiscal year 2020 increased by 17.4% to NIS 145.4 million (USD 45.2 million), or 32.0% of revenues, from NIS 123.9 million (USD 38.5 million), or 31.3% of revenues, recorded in fiscal year 2019. The increase in gross profit was primary due to increase in sales and the gross margin increase resulting from the Company's strategy of selling a favorable mix of products which generate a higher gross margin.

Selling expenses for fiscal year 2020 increased by 18.9% to NIS 66.0 million (USD 20.5 million), or 14.5% of revenues from NIS 55.5 million (USD 17.3 million), or 14% of revenues, recorded in fiscal year 2019. The increase in selling expenses was primarily due to an increase in payroll expenses in the logistics department as a result of working in two shifts to comply with government workplace restrictions due to the COVID-19 pandemic, and an increase of freight to customers' expenses to support sales growth.

General and administrative expenses for fiscal year 2020 increased by 4.0% to NIS 21.9 million (USD 6.8 million), or 4.8% of revenues, from NIS 21.1 million (USD 6.6 million), or 5.3% of revenues, recorded in fiscal year 2019. The increase in general and administrative expenses was primarily due to an increase in goal - based bonuses in the payroll expenses.

Operating profit for fiscal year 2020 increased by NIS 10.3 million (USD 3.2 million), or by 21.7%, to NIS 57.6 million (USD 17.9 million), or 12.7% of revenues, from NIS 47.3 million (USD 14.7 million), or 12.0% of revenues, recorded in fiscal year 2019. The increase in operating profit was primarily due to increase in gross profit.

Financial income, net, for fiscal year 2020 amounted to NIS 10.1 million (USD 3.1 million) compared to net income of NIS 18.0 million (USD 5.6 million) recorded in fiscal year 2019. The decrease in finance income, net was primarily due to a decrease in interest income and dividends received from the Company's securities portfolio and from decrease in revaluation of the Company's securities portfolio to its fair value.

Willi-Food ended fiscal year 2020 with NIS 356.5 million (US$ 110.9 million) in cash and securities with no short-term debt. Net cash from operating activities in fiscal year 2020 was NIS 64.2 million (US$ 20.0 million). Willi-Food's shareholders' equity at the end of December 2020 was NIS 585.7 million (US$ 182.2 million).

NOTE A: NIS to US$ exchange rate used for convenience only

The conversion from New Israeli Shekels (NIS) into U.S. dollars was made at the exchange rate as of December 31, 2020, on which USD 1.00 equaled NIS 3.215 The use of USD is solely for the convenience of the reader.

NOTE B: IFRS

The Company's consolidated financial results for fiscal year ended December 31, 2020 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 European Dairies, 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, adverse effects from the ongoing COVID-19 pandemic, 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 27, 2020. 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

December 31, December 31,

2 0 2 0 2 0 1 9 2 0 2 0 2 0 1 9

NIS US dollars (*)

(in thousands)

ASSETS

Current assets

Cash and cash equivalents 201,822 121,860 62,775 37,904

Financial assets at fair value through profit or loss 154,700 141,543 48,118 44,026

Loans to others 18,707 17,650 5,819 5,490

Trade receivables 131,301 133,039 40,840 41,381

Other receivables and prepaid expenses 6,667 9,360 2,074 2,911

Inventories 59,514 71,548 18,511 22,254

Current tax assets 3,965 - 1,233 -

Total current assets 576,676 495,000 179,370 153,966

Non-current assets

Property, plant and equipment 83,105 81,402 25,849 25,319

Less -Accumulated depreciation 46,460 43,881 14,451 13,649

36,645 37,521 11,398 11,670

Right of use asset 2,866 3,860 891 1,201

Financial assets at fair value through profit or loss 13,700 - 4,262 -

Goodwill 36 36 11 10

Deferred taxes - 818 - 254

Total non-current assets 53,247 42,235 16,562 13,135

629,923 537,235 195,932 167,101

EQUITY AND LIABILITIES

Current liabilities

Current maturities of lease liabilities 1,393 1,675 433 521

Trade payables 23,474 24,650 7,301 7,667

Employees Benefits 3,437 2,911 1,069 905

Current tax liabilities - 3,750 - 1,166

Other payables and accrued expenses 11,611 9,195 3,612 2,860

Total current liabilities 39,915 42,181 12,415 13,119

Non-current liabilities

Lease liabilities 1,592 2,212 495 688

Deferred taxes 768 - 238 -

Retirement benefit obligation 1,905 1,486 593 462

Total non-current liabilities 4,265 3,698 1,326 1,150

Shareholders' equity

Share capital 1,490 1,425 463 443

Additional paid in capital 170,760 128,354 53,114 39,923

Capital fund 247 247 77 77

Treasury shares (628) (628) (195) (195)

Retained earnings 415,196 362,987 129,143 112,904

Remeasurement of the net liability in respect of defined benefit (1,322) (1,029) (411) (320)

Equity attributable to owners of the Company 585,743 491,356 182,191 152,832

629,923 537,235 195,932 167,101

(*) Convenience translation into U.S. dollars.

G. WILLI-FOOD INTERNATIONAL LTD.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

For the year ended For the year ended

December 31, December 31,

2 0 2 0 2 0 1 9 2 0 2 0 2 0 1 9

NIS US dollars (*)

In thousands (except per share and share data)

Sales 454,094 395,637 141,242 123,060

Cost of sales 308,717 271,784 96,024 84,536

Gross profit 145,377 123,853 45,218 38,524

Operating costs and expenses:

Selling expenses 65,990 55,490 20,526 17,260

General and administrative 21,918 21,067 6,817 6,553expenses

Other income 108 - 34 -

Total operating expenses 87,800 76,557 27,309 23,813

Operating profit 57,577 47,296 17,909 14,711

Financial income 11,348 20,966 3,530 6,521

Financial expense 1,253 3,016 389 938

Total Finance Income 10,095 17,950 3,141 5,583

Profit before taxes on income 67,672 65,246 21,050 20,294

Taxes on income (15,463) (13,735) (4,810) (4,272)

Income after taxes on income 52,209 51,511 16,240 16,022

Earnings per share:

Basic / diluted earnings per share 3.89 3.90 1.21 1.21

Shares used in computation of 13,433,684 13,217,017 13,433,684 13,217,017 basic/diluted EPS

Actual number of shares 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

For the year ended For the year ended

December 31, December 31,

2 0 2 0 2 0 1 9 2 0 2 0 2 0 1 9

NIS US dollars (*)

In thousands (except per share and share data)

CASH FLOWS - OPERATING ACTIVITIES

Profit from continuing operations 52,209 51,511 16,240 16,022

Adjustments to reconcile net profit to net cash from (used to) 11,967 (51,948) 3,722 (16,158) continuing operating activities (Appendix A)

Net cash from (used to) continuing operating activities 64,176 (437) 19,962 (136)

CASH FLOWS - INVESTING ACTIVITIES

Acquisition of property plant and equipment (2,903) (1,791) (903) (557)

Proceeds from sale of property plant and equipment 108 - 34 -

Loans granted to others (20,000) (43,650) (6,221) (13,577)

Proceeds from loans granted to others 18,943 26,000 5,892 8,087

Proceeds from sale (purchase) of marketable securities, net (20,739) 11,336 (6,451) 3,526

Net cash used to continuing investing activities (24,591) (8,105) (7,649) (2,521)

CASH FLOWS - FINANCING ACTIVITIES

Lease liability payments (1,819) (1,128) (566) (351)

Shares issue 42,471 - 13,210 -

Acquisition of treasury shares - (628) - (195)

Net cash used to continuing financing activities 40,652 (1,756) 12,644 (546)

Increase (decrease) in cash and cash equivalents 80,237 (10,298) 24,957 (3,203)

Cash and cash equivalents at the beginning of the year 121,860 134,287 37,904 41,769

Exchange losses on cash and cash equivalents (275) (2,129) (86) (662)

Cash and cash equivalents at the end of the year 201,822 121,860 62,775 37,904

(*) Convenience Translation into U.S. Dollars.

G. WILLI-FOOD INTERNATIONAL LTD.

APPENDIX TO CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the year ended For the year ended

December 31, December 31,

2 0 2 0 2 0 1 9 2 0 2 0 2 0 1 9

NIS US dollars (*)

In thousands (except per share and share data)

CASH FLOWS - OPERATING ACTIVITIES:

A. Adjustments to reconcile net profit to net cash from (used to) continuing operating activities

Decrease (Increase) in deferred income taxes 1,586 2,064 493 642

Unrealized loss (gain) on marketable securities (6,115) (14,972) (1,903) (4,657)

Depreciation and amortization 5,690 4,815 1,770 1,498

Capital gain on disposal of property plant and equipment (108) - (34) -

Exchange (losses)/gains on cash and cash equivalents 275 2,129 86 662

Changes in assets and liabilities:

Decrease (increase) in trade receivables and other receivables 22,029 (29,776) 6,853 (9,262)

Increase in inventories 12,034 (22,259) 3,743 (6,923)

Increase (decrease) in trade and other payables, and other current (1,861) 16,050 (579) 4,992liabilities

Cash generated from operations 33,530 (41,949) 10,429 (13,048)

Income tax paid (21,563) (9,999) (6,707) (3,110)

Net cash flows from operating activities 11,967 (51,948) 3,722 (16,158)

(*) Convenience Translation into U.S. Dollars.

[1] StoreNext Ltd. has a direct connection to the cash register systems of over 2,200 points of sales, providing information regarding 80% of real time sales data in Israel.

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

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SOURCE G. Willi-Food International Ltd.