Strauss Doubles Net Profit in Q2 2026 Despite Coffee Sales Decline, Declares 180 Million Shekel Dividend

Strauss Group reported a doubling of its net profit in the second quarter of 2026, reaching 195 million shekels, despite a 6.7% decline in total revenues to 2.9 billion shekels compared to the same period last year. The revenue drop was mainly due to currency exchange effects and decreased coffee sales both domestically and internationally. The company’s gross profit margin improved significantly from 28.3% to 34.4%, and operating profit rose by 42% to 363 million shekels, aided by a one-time insurance compensation of 27 million shekels from a derivative lawsuit settlement and reduced administrative expenses.

International coffee sales, primarily from Brazil, fell 13% to 1.33 billion shekels, impacted by a stronger shekel and lower green coffee prices. However, operating profit in this segment surged 44% to 148 million shekels, with Brazil showing a 27.5% increase in gross profit margin despite an 8.2% sales decline in local currency. In Israel, sales decreased slightly by 1.5% to 1.3 billion shekels, influenced by the sale of the Elite coffee chain and discontinuation of some chilled products. Nonetheless, operating profit in Israel jumped 46% to 198 million shekels, supported by efficiency measures, currency benefits, and the insurance settlement.

Other segments showed mixed results: health and wellness sales remained stable with a slight dip to 804 million shekels but a 4.3% rise in operating profit; snacks and confectionery sales grew modestly by 1.8%, while operating profit soared to 52 million shekels. The water segment expanded with a 7.1% sales increase to 233 million shekels and a 4.9% rise in operating profit. In China, Strauss’s water subsidiary posted a 2.6% sales increase in yuan terms but a 14.3% net profit decline due to investments in product development and marketing.

Cash flow from operations improved markedly to 146 million shekels from 20 million shekels a year earlier, and the net financial debt to EBITDA ratio fell to 1.6 from 2.2. Following the report, Strauss’s board approved an additional dividend payout of 180 million shekels, adding to the 250 million shekels declared in March.

Looking ahead, Strauss is advancing its growth strategy in Brazil through its joint venture Três Corações, which signed a deal in March to acquire Yoki, a food company active in dry foods, snacks, seasoning, and cooking solutions, for 800 million Brazilian reais. The acquisition, pending Brazilian competition authority approval, is expected to close by the end of 2026 and aims to expand Strauss’s platform in Brazil beyond coffee into broader food categories.