Lesico (LSCO) Q2 2024 earnings summary

Executive summary

• Revenue for H1 2024 increased by 16.3% year-over-year to ₪466.9 million, driven mainly by growth in the construction segment, especially in Israel.

• Net profit for H1 2024 was ₪4.9 million (1.0% margin), down from ₪9.4 million (2.4%) in H1 2023, mainly due to lower gross margins and higher tax expenses.

• EBITDA for H1 2024 was ₪16.2 million, nearly flat compared to H1 2023.

• The company maintains strong liquidity with cash and equivalents of ₪151 million as of June 30, 2024.

Financial highlights

• Gross profit for H1 2024 was ₪31.9 million (6.8% margin), down from ₪33.5 million (8.3%) in H1 2023, mainly due to changes in project estimates in the construction segment.

• Operating profit for H1 2024 was ₪9.2 million (2.0% margin), stable year-over-year.

• Net finance expenses increased to ₪1.3 million in H1 2024 from net finance income of ₪2.3 million in H1 2023.

• Cash flow from operations in H1 2024 was positive at ₪41.6 million, compared to negative ₪26.6 million in H1 2023.

• Total assets as of June 30, 2024, were ₪686.4 million; equity attributable to shareholders was ₪212.9 million.

Outlook and guidance

• Management expects continued uncertainty and potential slowdown in project execution due to ongoing security situation in Israel, but sees potential for increased infrastructure demand.

• No deterioration in financial stability is identified, supported by strong cash balances and positive working capital.

• The order backlog stands at ₪1,495 million, providing visibility for future activity.