The net profit of the Rami Levy chain jumped by 69% in the second quarter of this year to NIS 61 million

The net profit of the Rami Levy chain jumped by 69% in the second quarter of this year to NIS 61 million - following the improvement in trading conditions, a strong emphasis on saving on operating expenses, the efficiency of the logistics center and the contribution of the private label. This emerges from the reports published by the network.
Revenues for the quarter grew by 4.3% to NIS 1.59 billion. Along with the profit, Levy recorded another achievement - operating profit jumped by 46%. The private label fell from 20% of sales to 18.6%. Online accounted for 9.9% of total sales in the second quarter.
The operating profit ratio of total sales jumped to 5.73% compared to 4% in the previous quarter (Shufersal presented an operating profit ratio of 5.1% in the second quarter) thanks to the opening of new branches and an increase in sales. Identity store sales rose 0.1%.
Despite the trend of neighborhood stores, and those who claim that the public is moving from discount stores to home-based purchases, the chain's financial results with 55 discount branches show that the public is still flocking to discount chains. Levy owns 18 small Rami Levy stores in the neighborhood (formerly Kopix), but their share in total sales reaches only NIS 75 million in the quarter. The chain reported that it "recognizes the growth potential of 20 additional branches without producing cannibalization for existing branches."
The company recently launched a large robotic center in Be'er Sheva that is expected to deliver up to 2,000 online orders a day. In the coming days, the launch of a new logistics center "Rami Levy for Business" for wholesale sale to businesses, institutions and containers in the north of the country is expected.
The Rami Levy chain is the strongest chain among the large chains: a short-term cash and investment of NIS 916 million, while the company has a gross financial debt of only NIS 13 million. Accordingly, the company has a net financial asset surplus in the amount of NIS 903 million. The company announced that it is allocating an amount of about half a billion shekels from the cash fund for strategic investment that will lead to an increase in the average shopping basket of the company's customers in the company's branches and is considering such investments.
Gross profit in the second quarter of 2021 increased by 11% to NIS 383 million, compared with NIS 345 million in the corresponding quarter last year. The increase in gross profit was due to the said growth in the volume of activity. The increase is due to the improvement in terms of trade, the expansion of the number of suppliers using the logistics center, the private label and the profitability of the subsidiaries.
Simultaneously with the publication of the reports, the company announced a dividend distribution to shareholders in the amount of NIS 50 million, which is added to a distribution of NIS 90 million from the beginning of the year.
Rami Levy noted that "in the end, people want to buy cheaply and are loyal to the chain. We were able to improve profitability not at the expense of the consumer price but by improving trade conditions, the logistics center and the private label and continuing to lower operating costs."
Levy added that "the food security provided by a retail chain through a stable supply and without shortages is extremely important. We are working to prevent price increases despite problems. The state must try and open the maritime traffic jam and help retailers in the world of trade."