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G. Willi-Food Reports Fiscal 2013 Net Profit Up 33% From Fiscal 2012 Net Profit

YAVNE, Israel, March 18, 2014 /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 financial results for the fiscal year ended December 31, 2013.

Fiscal 2013 Highlights

  • Sales increased 17.3% from fiscal 2012 to NIS 336.0 million (US$ 96.8 million)
  • Gross profit increased 21.2% from fiscal 2012 to NIS 83.7 million (US$ 24.1 million), or 24.9% of sales
  • Operating income increased 24.5% from fiscal 2012 to NIS 29.2 million (US$ 8.4 million), or 8.7% of sales
  • Income before taxes increased 30.1% from fiscal 2012 to NIS 41.3 million (US$ 11.9 million), or 12.3% of sales
  • Net income increased 32.5% from fiscal 2012 to NIS 31.8 million (US$ 9.2 million), or 9.5% of sales
  • Earnings per share of NIS 2.45 (US$ 0.71) increased 32.5% compared to earnings per share of NIS 1.85 (US$ 0.53) in fiscal 2012 
  • Cash, securities balance and loan to C.D-B.A Holdings (Designated) (2013) Ltd. ("Newco") (net of short-term bank debt) of NIS 214.4 million (US$ 61.8 million) as of December 31, 2013

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.

Fiscal 2013 Results
Sales for fiscal 2013 increased by 17.3% to NIS 336.0 million (US$ 96.8 million) from NIS 286.5 million (US$ 82.5 million) in fiscal 2012. Sales increased in fiscal 2013 due to our increased marketing efforts and the growing demand from domestic and international customers for our quality kosher products. In addition, we continued to benefit from a shift in behavior in Israel as cost-conscious consumers recognize our products as a viable alternative to higher cost leading brands.

Gross profit for fiscal 2013 increased by 21.2% to NIS 83.7 million (US$ 24.1 million) compared to NIS 69.0 million (US$ 19.9 million) recorded in fiscal 2012. Fiscal 2013 gross margin was 24.9% compared to gross margin of 24.1% for fiscal 2012. The improvement in gross margin was the result of a favorable mix of product revenue during the year as sales of higher gross margin products increased faster than sales of lower gross margin products.

Mr. Zwi Williger, Chairman of Willi-Food commented, "We are very pleased to report a strong year, with organic sales growth of 17.3%, gross profit growth of 21.2%, operating income growth of 24.5% and net income growth of 32.5% as our customer base continues to expand and market demand for our products continues to increase. Despite the pressure imposed on the Company by the supermarket chains to reduce prices and despite the well-known pressures in commodity costs imposed worldwide, we continued to gain traction with new customers while product sales to existing customers also continued to grow."

Willi-Food's operating income for fiscal 2013 increased by 24.5% to NIS 29.2 million (US$ 8.4 million) compared to NIS 23.5 million (US$ 6.8 million) recorded in fiscal 2012. Selling expenses increased by 21.5% from 2012, primarily due to an increase in promotional expenses as well as vehicles and transport expenses, each of which increased due to the growth in sales. Selling expenses as a percentage of sales increased in fiscal 2013 to 10.5% compared to 10.0% in fiscal 2012. General and administrative expenses increased by 16.1% from fiscal 2012, primarily due to an increase in management profit-related bonuses. General and administrative expenses as a percentage of sales in fiscal 2013 were 5.8%, approximately the same percentage as in fiscal 2012.

Willi-Food's income before taxes for fiscal 2013 increased by 30.1% to NIS 41.3 million (US$ 11.9 million) compared to NIS 31.8 million (US$ 9.2 million) recorded in fiscal 2012.

Willi-Food's net income for fiscal 2013 increased by 32.5% to NIS 31.8 million (US$ 9.2 million), or NIS 2.45 (US$ 0.75) per share, from NIS 24.0 million (US$ 6.9 million), or NIS 1.85 (US$ 0.53) per share, recorded in fiscal 2012.

Willi-Food ended 2013 with NIS 214.4 million (US$ 61.8 million) in cash, securities and loan to Newco net from short-term debt. Willi-Food's shareholders' equity at the end of December 2013 was NIS 365.8 million (US$ 105.4 million).

Business Outlook
Mr. Williger continued, "Our strong performance in 2013 was driven by expanded sales volume of our higher-margin products to new and existing customers. With sales increases in all of our business segments, we were able to achieve the highest sales and gross profit in the Company's history. The broad-based strength of our business enabled us to deliver record results, both on the top and bottom lines. We have significantly expanded our product lines and continue to deliver improved margins. As we see consumer demand for kosher foods continuing to increase, we are confident that our focused marketing strategy and the introduction of higher-margin products targeted to health-conscious and kosher consumers will continue to support our growth in 2014."

"Due to increased awareness in Israel of the rising food prices, customers have realized that they can obtain food products from us of comparable or better quality than those of the leading brands but at more affordable prices, causing our customer base and the demand for our products to increase," Mr. Williger noted.  "Our financial results have significantly improved over the last six quarters as a direct result of our strategy to organically grow our customer base and product line, while at the same time expanding our margins. We implemented our plan to increase the awareness of our products by initiating promotional activities that created broad awareness of our new and old products, broadening 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. We intend to reinvest in the development of the Company in order to maximize profitability and increase long-term value for our shareholders. Moreover, we are pleased to consistently deliver significantly higher margins than those generated by most of the other companies in our industry, as we are able to differentiate our Company through our success by becoming a high margin business in a low margin industry." 

Furthermore, Mr. Williger added, "About two weeks ago, my brother Joseph and I signed an agreement to sell to Emblaze, which is traded on the London Stock Exchange, our controlling stake in Willi-Food Investments Ltd., the controlling shareholder of the Company. We view this sale as an opportunity for the Company to continue its accelerated development in the food sector, both in Israel and outside Israel and possibly to expand into additional activities. Both my brother and I will continue to manage the Company, together with the Company's personnel and the management of Emblaze, in order to continue to develop the Company."

"We believe we are well positioned to continue our expansion and the recent financial results certainly confirm our belief in our strategy," concluded Mr. Williger. "We are constantly focusing on looking to meet the demands of consumers for new kosher products, and we have the infrastructure in place and development expertise to develop and deliver these products. At the same time, we remain focused on maximizing long-term profitability and creating additional value for our shareholders." 

Conference Call
The Company will host a conference call and live webcast on March 18, 2014 to discuss the financial results beginning at 11:00 AM Eastern Time. Interested parties may participate on the call by dialing 1-877-941-1427 (US), or 1-480-629-9664 (International), approximately 10 minutes prior to the scheduled start time. Participants may also access a live listen only webcast at:
 http://public.viavid.com/index.php?id=108184

Following the conclusion of the call, a telephonic replay will be available for 14 days beginning at 2:00 PM Eastern Time on March 18, 2014 through 11:59 PM Eastern Time on April 1, 2014 and may be accessed by dialing 1-877-870-5176 (US), or 1-858-384-5517 (International), using access code 4672792.  In addition, an archived webcast will be available for one year at: http://public.viavid.com/report-s/eventparticipantreporttab.php?id=o5aqoJ%2Bb

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 December 31, 2013, U.S. $1.00 equals NIS 3.471. 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 fiscal year ended December 31, 2013 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 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 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, 2012, filed with the Securities and Exchange Commission on April 30, 2013. 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 1 3

2 0 1 2

2 0 1 3

2 0 1 2


NIS

US dollars (*)


(in thousands)

          ASSETS





Current assets





Cash and cash equivalents

36,197

57,563

10,428

16,584

Financial assets carried at fair value through profit or loss

112,864

158,810

32,516

45,753

Trade receivables

82,932

71,340

23,894

20,553

Other receivables and prepaid expenses

2,694

5,988

777

1,725

Inventories

54,001

49,270

15,558

14,195

Loan carried at fair value through profit or loss

65,300

-

18,813

-

Total current assets

353,988

342,971

101,986

98,810






Non-current assets





Property, plant and equipment

66,663

63,022

19,206

18,157

Less -Accumulated depreciation

25,689

21,394

7,401

6,164


40,974

41,628

11,805

11,993






Prepaid expenses

50

62

14

18

Goodwill

36

36

10

10

Deferred taxes

-

20

-

6

Total non-current assets

41,060

41,746

11,829

12,027







395,048

384,717

113,815

110,837

EQUITY AND LIABILITIES





Current liabilities





Short-term bank debt

18

9,930

5

2,861

Trade payables

20,245

28,744

5,833

8,281

Employees Benefits

1,880

1,659

542

478

Accruals

-

3,446

-

993

Current tax liabilities

637

2,117

184

610

Other payables and accrued expenses

5,282

4,479

1,522

1,290

Total current liabilities

28,062

50,375

8,086

14,513






Non-current liabilities





Retirement benefit obligation

644

581

186

167

Deferred taxes

499

-

144

-

Total non-current liabilities

1,143

581

330

167






Shareholders' equity





Share capital NIS 0.10 par value (authorized - 50,000,000 shares,

issued and outstanding – 12,974,245 shares at December 31, 2013;

12,974,245 shares at December 31, 2012)

1,407

1,444

416

416

Additional paid in capital

119,281

129,897

37,478

37,424

Capital fund

247

247

71

71

Foreign currency translation reserve

786

639

226

184

Retained earnings

244,185

212,377

70,350

61,186

Treasury shares

-

(10,843)

(3,124)

(3,124)

Capital Fund remeasurement of the net liability in respect of defined

   benefit

(63)

-

(18)

-


365,843

333,761

105,399

96,157







395,048

384,717

113,815

110,837






(*)        Convenience translation into U.S. dollars


 

 

G. WILLI‑FOOD INTERNATIONAL LTD.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS








For the year ended
December 31,

For the year ended
December 31,



2 0 1 3

2 0 1 2

2 0 1 3

2 0 1 2



NIS

US dollars (*)



In thousands  (except per share and share data)








Sales

336,032

286,509

96,811

82,544


Cost of sales

252,355

217,468

72,704

62,653








Gross profit

83,677

69,041

24,107

19,891








 Selling expenses

35,130

28,915

10,121

8,330


 General and administrative expenses

19,408

16,715

5,591

4,816


 Other income

(54)

(46)

(16)

(13)








Total operating expenses

54,484

45,584

15,696

13,133








Operating income

29,193

23,457

8,411

6,758








Financial income

13,008

8,716

3,748

2,511


Financial expense

876

410

252

118


Total financial income

12,132

8,306

3,496

2,393








 Income before taxes on income

41,325

31,763

11,907

9,151


 Taxes on income

(9,517)

(7,757)

(2,742)

(2,235)








Net income

31,808

24,006

9,165

6,916








Earnings per share:

 






Basic earnings per share

2.45

1.85

0.71

0.53








Diluted earnings per share

2.45

1.85

0.71

0.53








Shares used in

   computation of basic EPS

12,974,245

12,977,481

12,974,245

12,977,481
















(*)        Convenience translation into U.S. dollars


 

G. WILLI‑FOOD INTERNATIONAL LTD.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 





For the year ended
December 31,

For the year ended
December 31,


2 0 1 3

2 0 1 2

2 0 1 3

2 0 1 2


NIS

US dollars (*)


In thousands (except per share and share data)

CASH FLOWS - OPERATING ACTIVITIES





Profit from continuing operations

31,808

24,006

9,165

6,916

Adjustments to reconcile net income to net cash provided by  

   operating activities:

(28,078)

(31,127)

(8,090)

(8,967)

Net cash from (used in) continuing operating activities

3,730

(7,121)

1,075

(2,051)

Net cash from discontinued operating activities

-

-

-

-






CASH FLOWS - INVESTING ACTIVITIES





Acquisition of property plant and equipment

(6,077)

(1,628)

(1,751)

(469)

Proceeds from sale of property plant and Equipment

29

269

8

77

Additions to long term other receivables

(445)

-

(128)


Proceeds from  purchase of marketable securities, net

56,309

8,654

16,223

2,493

Proceeds used in purchase of  loan carried at fair value through profit 

  or loss

(65,000)

-

(18,727)

-

Net cash from (used in) continuing investing activities

(15,184)

7,295

(4,375)

2,101

Net cash from discontinued investing activities

-

13,500

-

3,889






CASH FLOWS - FINANCING ACTIVITIES





 

Short-term bank debt, net

(9,912)

9,930

(2,856)

2,861

Investment used in treasury stocks

-

(702)

-

(202)

Net cash from (used in) continuing financing activities

(9,912)

9,228

(2,856)

2,659

Net cash used in discontinued financing activities

-

-

-

-

Increase (decrease) in cash and cash equivalents

(21,366)

22,902

(6,156)

6,598

Cash and cash equivalents  at the beginning of the financial period

57,563

34,661

16,584

9,986






Cash and cash equivalents of the end of the financial period

36,197

57,563

10,428

16,584











 

 (*)          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 1 3

2 0 1 2

2 0 1 3

2 0 1 2


NIS

US dollars (*)


In thousands  (except per share and share data)






Adjustments to reconcile net income to net cash from operating activities

 





Depreciation and amortization

4,459

3,134

1,285

903

Unrealized Gain of  loan carried at fair value through profit 

  or loss

(300)

-

(86)

-

Decrease in deferred income taxes

519

913

150

263

Capital Gain  on disposal of property plant and equipment

(29)

(89)

(8)

(26)

Unrealized Gain on marketable securities

(10,363)

(4,034)

(2,986)

(1,162)

Stock based compensation reserve

190

88

55

25

Employees benefit, net

-

63

-

19






Changes in assets and liabilities:





Increase in trade receivables and other receivables

(9,046)

(16,613)

(2,607)

(4,786)

Increase in inventories

(4,731)

(16,657)

(1,364)

(4,799)

Increase (decrease) in payables and other current liabilities

(8,777)

2,068

(2,529)

596


(28,078)

(31,127)

(8,090)

(8,967)











(*)           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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