TSG IT Advanced Systems (TSG) Q2 2024 earnings summary

Executive summary

• H1 revenue edged higher year over year, with civilian-segment growth offsetting softer defense revenue; net income declined.

• Operating cash flow strengthened in H1; the IPO and full ARTES acquisition closed on 1 Aug 2024, after the reporting period.

Financial highlights

• H1 revenue was ₪152.286m vs ₪150.847m year over year; Q2 revenue was ₪77.325m vs ₪76.416m.

• H1 gross profit rose to ₪34.567m from ₪30.969m; net income declined to ₪3.653m from ₪5.453m.

• Q2 operating income was ₪5.610m vs ₪6.804m and net income was ₪1.393m vs ₪2.825m.

• H1 operating cash flow was ₪31.734m vs ₪19.012m; cash and equivalents were ₪46.075m at 30 Jun 2024.

Outlook and guidance

• Expected defense-sector growth is supported by increased security budgets in Israel and globally.

• Plans include expanding international sales and leveraging synergies from acquisitions.