Angel Bakery, despite facing an ultra-Orthodox boycott in May, has managed to achieve a remarkable 14% increase in sales during the first half of 2023, amounting to NIS 251 million. The company's financial report, released last night and signed by Chairman Omer Bar Lev, sheds light on the underlying factors behind this unexpected growth.
The boycott, which was announced in response to Chairman Omer Bar Lev's participation in a protest near the residence of the late Rabbi Gershon Edelstein in Bnei Brak, initially seemed to impact the bakery's revenues, particularly in the ultra-Orthodox strongholds of Bnei Brak, Beitar Illit, and Modi'in Illit. This was reflected in a quantitative decrease in sales during the month of May. Despite these hurdles, Angel Bakery managed to achieve an overall increase in sales for the first half of the year.
The company's success can be attributed to several key factors. Notably, there was a 5% price hike in the supervised bread segment. Additionally, the bakery witnessed an impressive 46% surge in sales within the United States market, which contributes to 10% of the company's total revenue.
While Angel Bakery has grappled with losses in the past, the first half of 2023 saw a significant improvement. The company reported a loss of approximately NIS 4 million, showcasing progress compared to the NIS 10 million loss reported during the same period the previous year. This turnaround can be partially attributed to the sale of 19 dunams of real estate in Talpiot, previously occupied by criminal entities.
A noteworthy aspect of Angel Bakery's sales makeup is that a quarter of its revenue comes from supervised bread sales. Despite the price increase, supervised bread remains a product that doesn't yield profits for the company. This is partly due to the government's delay in updating the prices of supervised bread. The inter-ministerial price committee's decision to remove the bread from supervision last year was met with resistance from the then-Economy Minister, Orna Barbibai. Subsequently, bakeries took legal action against the government, with the case now pending in the High Court.
In conclusion, Angel Bakery's ability to weather the storm of an ultra-Orthodox boycott and still achieve substantial sales growth in the first half of 2023 underscores the company's resilience and adaptability in a challenging market landscape. The diverse factors contributing to this growth highlight the bakery's capacity to navigate complexities and capitalize on emerging opportunities.