Shufersal Reports Sharp Revenue and Profit Declines, Shares Plunge Over 7%

Shufersal, Israel's largest supermarket chain, reported a significant drop in its financial results for the second quarter of 2026. Revenues fell by 7.5% to 3.41 billion shekels compared to the same period last year, while operating profit plunged 36% to 170 million shekels. Net profit also declined sharply by 31%, reaching 135 million shekels. The critical metric of same-store sales, which measures performance in stores open during both periods, dropped by 8.5% in the quarter.

The company attributed the downturn primarily to the timing of the Passover holiday, which this year concentrated its impact in the first quarter, and a reduced effect from the "Roar of the Lion" campaign that had boosted sales in March and early April. Despite these explanations, the results suggest a possible decrease in customer purchasing amid Israel's high cost of living. For the first half of 2026, revenues decreased by 1.6% to 7.1 billion shekels, net profit fell 12% to 310 million shekels, and same-store sales declined by 2.7%, indicating a worsening trend as the year progressed.

Shufersal's private label products increased their share of total sales to 19.7% in the quarter and 20.4% for the half-year, reflecting a strategic effort to improve profitability. The company also reported a working capital deficit of 813 million shekels as of June 30, up from 653 million shekels a year earlier, signaling increased cash flow pressure. However, management assured that available cash reserves and credit lines mitigate liquidity concerns.

Following the disappointing earnings release, Shufersal's shares dropped more than 7% in Tel Aviv stock trading. The board declared a dividend payout of 180 million shekels to shareholders, scheduled for October 1. The controlling Amir brothers continue to lead the company and its strategic initiatives amid these challenging market conditions.