The rise in food prices helped Strauss Group (TASE: STRS) to higher revenue in the first quarter, and to a jump in net profit. The company, controlled by the Strauss family and headed by Shai Babad, recorded a 9% rise in quarterly revenue to NIS 1.9 billion. A sharp cut in operating expenses helped to lift operating profit by 170% to NIS 181 million. Net profit rose 68%, to NIS 86 million.
The figures cited are from Strauss Group’s financial statements, but the company also publishes management accounts that combine Strauss’s own results with the share of its business partners around the world. The company has extensive activity overseas, such as its coffee business in Brazil and the sale of water filtering devices in China.
The management accounts give a different picture, certainly when it comes to profitability. Strauss Group’s sales totaled NIS 3 billion, representing a 15.5% year-on-year rise. The increase stems from a rise in sales of sweets and snacks, and also higher coffee sales. Strauss said the rise was in sales volume and not just a result of inflation, and that the timing of the Passover holiday and the effects of the war had a negative impact in the first quarter last year. Sales of Tami 4 water dispensers also improved between the two periods.
The management gross profit margin narrowed from 33.7% to 26.1%, mainly because of currency differences, but also because of higher raw materials costs, especially of cocoa and coffee. Operating profit fell 11% to NIS 181 million, while the management net profit fell 55% to NIS 73 million. Strauss Group’s sales in Israel rose 6.2% year-on-year, to NIS 1.6 billion.
“We posted very significant growth in our activity all over the world, we continued to improve our market share in our main categories, we strengthened our status as the leading coffee company in Brazil, and we grew in Israel thanks to innovation, products, strengthening of our best-loved brands, and a focus on the consumers,” Babad said.
The CEO added that Strauss Group had recently laid the foundation stone of a new logistical center in Bror Hayil, near Sderot in southern Israel, and that later this year it would launch a new factory for plant-based milk alternatives in the north of the country.
Published by Globes, Israel business news – en.globes.co.il – on May 28, 2025.
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