The largest retail chain in Israel Shufersal Company Limited (level:Sai) ended the first quarter of 2024 with an improvement in all its key milestones including a 35% jump in net profit to NIS 89 million.
At the end of the quarter, the Amir brothers – Yossi and Shlomi – completed their acquisition of the company, and the latest financial results do not reflect their operations. The Amir brothers became co-CEOs at the beginning of April, while Chairman Itzik Aberkuhen and CEO Uri Waterman have since departed along with other senior management.
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Under the old management, Shufersal reported revenues of NIS 3.8 billion in the first quarter of 2023, up 1.8% from the first quarter of 2023, despite the Passover holiday being significantly reduced in the second quarter of this year. The company said that the increase in revenues came as a result of the opening of new branches and the increase in sales in existing branches.
However, revenue fell from NIS 3.9 billion in the fourth quarter of 2023 when customers made panic purchases after the outbreak of war.
Sales per square meter in Shufersal branches, which peaked in 2020 during the Covid pandemic, at NIS 27,900 per square meter, eroded in recent years to NIS 25,200 last year, as well as in the first quarter. In the Internet sector, Shuversal's “non-food” activity was reduced as part of a strategy to focus on profits, and the proportion of revenues it achieved from total sales fell to 18.7% from 19.3% in the corresponding quarter of last year.
Today, Shuversal's share price rose 0.94%, giving a market capitalization of NIS 6.6 billion, up 50% from the beginning of the year, mainly due to the takeover by the Amir brothers, after the chain operated for several years without a controlling shareholder. Since completing their takeover of the company in February, the Amir brothers have already made NIS 150 million, on paper, from their investment. The Amir brothers are confident that with further simplification they can increase Shufersal's profitability.
Published by Globes, Israel Business News – en.globes.co.il – on May 28, 2024.
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