Strauss Group (STRS) Q4 2024 earnings summary

Executive summary

• FY 2024 net sales rose 6.2% year-over-year to NIS 11,206 million, with 8.6% organic growth, driven by price increases and strategic focus on core businesses.

• Margins declined due to significant increases in cocoa and coffee prices, impacting EBIT and net profit.

• Productivity initiatives, portfolio optimization, and divestments supported resilience and future readiness.

• Continued investment in innovation, new product launches, and expansion in alternative milks and water segments.

• Divestitures included Sabra, Obela, Serbian coffee, and Israeli fresh vegetables businesses, with proceeds of up to NIS 900 million.

Financial highlights

• Q4 2024 sales grew 6.6% year-over-year to NIS 2,872 million; FY 2024 sales up 6.2% to NIS 11,206 million.

• Gross margin for FY 2024 was 30.7% (down 140 bps); Q4 gross margin 28.3% (down 330 bps), reflecting input cost pressures.

• FY 2024 operating profit was NIS 752 million (6.7% margin), down 2.6% from 2023; net profit was NIS 418 million, down 4.8%.

• Operating cash flow for 2024 was NIS 600 million, down 30.3% year-over-year; capex increased 28.4% to NIS 651 million.

• Negative FX translation differences and rising finance costs reduced reported sales and profits.

Outlook and guidance

• Confident in achieving 5%+ annual growth and EBIT margin expansion to 10–12% by 2026, supported by productivity and innovation.

• Continued focus on core business, new product launches, and investments in growth engines like water and alternative milks.

• Ongoing M&A activity, further SKU reduction, and major CAPEX in new plants and automation planned.

• 85% of total sales expected from core by 2026.

• New plant-based dairy facility in Israel and a second water plant in China expected to open in 2025.