LONDON, UK / ACCESSWIRE / October 23, 2017 / Pro-Trader Daily takes a look at the latest corporate events and news making the headlines for G. Willi-Food International Ltd (NASDAQ: WILC) ("Willi-Food"), following which we have published a free report that can be viewed by signing up at http://protraderdaily.com/optin/'symbol=WILC. The Company announced on October 19, 2017, that its wholly owned subsidiary, Gold Frost Ltd ("Goldfrost"), has received a notice from Arla Foods amba ("Arla") to end their Exclusive Distribution Agreement. The distribution agreement will end effectively on December 31, 2017. For immediate access to our complimentary reports, including today's coverage, register for free now at:
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According to Willi-Food, Arla's decision to end the Exclusive Distribution Agreement would have a major impact on its operating results. However, the Company is confident in bringing on board alternative suppliers to cover a portion of products currently being supplied by Arla.
Background
Arla Foods is a Danish dairy products producer and had an existing exclusive distribution agreement Willi-Food's subsidiary Goldfrost. In January 2017, Goldfrost and Arla had signed an agreement for a one-year extension of their Exclusive Distribution Agreement which would be valid from December 29, 2016, until December 31, 2017. As per the terms of the agreement, Goldfrost was granted exclusive non-transferable right to import, export, market, and distribute cheese and butter products manufactured by Arla in Israel. However, the exclusivity would be valid only if Goldfrost continues to order minimum quantities of certain Arla products. The agreement also stipulated that Arla had the right to terminate the agreement under circumstances, including the unfortunate event of death or permanent incapacity of Iram Graiver, CEO of Willi-Food or if he stops being involved in Goldfrost's business.
Major Changes in Willi-Food's Top Management
In the last few months, Willi-Food's top management team has been facing difficult times. In July 2017, the Company ended the term of Iram Graiver, its then-CEO, followed by the termination of Pavel Buber, its then-CFO, a few days later. The Company appointed Tim Cranko as its new CEO in the same month. In October 2017, the Company announced the appointment of Amir Kaplan as CFO.
In August 2017, the Company had reported a drop in its profits for H2 2017. Its Q2 gross profit for fiscal year 2017 was NIS 14.6 million (US$ 4.2 million), which was approximately a drop of 32.2% on a year-on-year basis. The Company attributed the decline in profits to increased inventories and reduction in prices of certain products.
About G. Willi-Food International Ltd
Yavne, Israel based Willi-Food is a distributor of kosher food products. The Company's business is handled by two divisions: Willi-Food in Israel and Goldfrost, a wholly owned subsidiary which designs, develops, and distributes branded kosher, dairy-food products. Some of the brands handled by the Company include DEL MONTE (canned fruits and vegetables), DAAWAT (rice), SERA (pickled and roasted vegetables), ZANETTI (hard cheeses), LURPAK, ARLA FOOD (butter spreads and dairy products). The Company along with its subsidiaries design, import, market, and distribute over 600 food products to over 1,500 customers in Israel and around the world. These customers include large retail and private supermarket chains, wholesalers, and institutional consumers.
About Arla Foods amba
European dairy giant Arla is one of the world's largest producer of organic dairy products of highest quality. The Company is owned by over 12,700 farmers located across Denmark, Sweden, the UK, Germany, Belgium, Luxemburg and the Netherlands. Some of the Company's popular brands include Arla®, Lurpak®, and Castello®.
Arla recently launched Arla Organic Milk in the UAE as part of Arla Strategy 2020, the Company's ambitious business strategy of becoming the number one organic dairy brand in the Middle-East and North Africa by 2020. The Company also has plans to expand its presence in Saudi Arabia and Kuwait in FY18.
Last Close Stock Review
At the close of trading session on Friday, October 20, 2017, G. Willi-Food Intl.'s stock price dropped 8.03% to end the day at $5.38. A total volume of 69.75 thousand shares were exchanged during the session, which was above the 3-month average volume of 11.97 thousand shares. The Company's shares are trading at a PE ratio of 62.56 and have a dividend yield of 7.06%. At Friday's closing price, the stock's net capitalization stands at $77.53 million.
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