Tadiran Reports Quarterly Profit as Energy Sector Sales Surge 34%
Tadiran, controlled 64.41% by Moshe Mamroud, closed the second quarter with a net profit of 15 million shekels attributable to shareholders, reversing a net loss of 44.8 million shekels in the same quarter last year. The company's sales grew by 15.1% to 551.7 million shekels, driven by a 34% increase in its energy sector sales, which reached 250.3 million shekels. This sector includes importing and distributing products for photovoltaic systems, uninterruptible power supplies, electric vehicle charging stations, and storage systems.
However, growth in the energy sector was offset by a 5.6% decline in the consumer products sector, which markets air conditioners and white goods, with sales totaling 216.1 million shekels. The decrease was attributed to the impact of Operation Breaking Dawn and a drop in the average price of air conditioners, partly due to a weaker dollar exchange rate. Gross profit rose by 15% to 89.9 million shekels, maintaining a gross margin of 18.7%, similar to the previous year. The increase was seen in both sectors and was driven by improved procurement costs and the lower dollar rate.
Operating profit improved significantly by 46.6% to 22.9 million shekels, raising its margin to 6.4% of sales compared to 5% in the prior year. The company recorded a 5 million shekel loss due to revaluation of a liability related to a put option for acquiring VP Solar, caused by exchange rate and financial debt changes. Tadiran also noted a recent temporary directive from the Electricity Authority freezing processing of requests related to data center projects for 140 days, though this does not affect projects with signed commitments currently in technical coordination. The company cannot yet assess the directive's impact on its data center activities.
Additionally, Tadiran's board approved extending the company's stock option plan for another 10 years and granted 9,000 unregistered options exercisable into ordinary shares to two subsidiary employees equally. The options vest over four years, with 25% exercisable annually until August 2032, valued at approximately 318,000 shekels each.
