Kosher Food (WILC)

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G. Willi-Food Reports Highest Quarterly Revenues in Company History for First Quarter of 2006

Tuesday May 9, 8:03 am ET

Significant YOY Gains in Revenues, Gross, Operating and Net Profits


YAVNE, Israel, May 9 /PRNewswire-FirstCall/ --
First Quarter 2006 Financial Highlights
- 34.7% increase in sales over first quarter of 2005
- 71.8% increase in gross profit versus first quarter of 2005
- 163.9% increase in operating income, excluding G&A expense related to one-time unrealized capital gain, compared to same quarter last year

- 164.1% increase in net income, excluding the effect of one-time unrealized capital gain, compared to same quarter last year

G. Willi-Food International Ltd. (NASDAQ: WILC - News; the "Company" or "Willi Food"), one of Israel's largest food importers and a single-source supplier of one of the world's most extensive range of quality kosher food products, today announced its unaudited financial results for the quarter ended March 31, 2006.

The Company's revenues for the first quarter of 2006 increased 34.7% to NIS 54.5 million (US $11.7 million) compared to revenues of NIS 40.5 million (US $8.7 million) in the first quarter of 2005. The Company's gross profits for the first quarter of 2006 increased 71.8% to NIS 14.4 million (US$3.1 million) compared to gross profits of NIS 8.4 million (US $1.8 million) in the first quarter of 2005. 2006 first quarter gross margins of the Company improved to 26.4% compared to gross margins of 20.7% in the same period in 2005.

Mr. Zwi Williger, President and COO of Willi-Food commented, "We are very excited about our strong results for first quarter of 2006. With sales increases in all of our business segments, we were able to achieve the highest quarterly revenues and gross profit in the Company's history. Our domestic market drove revenue gains for the quarter, and we anticipate growth in the export market as well."

The Company's operating income for the first quarter of 2006 increased 84.5% to NIS 4.4 million (US $0.9 million) from NIS 2.4 million (US $0.5 million) reported in the comparable quarter of last year. 2006 first quarter operating income includes the effect of a one-time NIS 1.3 million (US $0.3 million) expense that was recorded during the quarter for an advertising campaign to promote Willi-Food's brand name and products whose effect will continue throughout the year, as well as a NIS 1.9 million (US $0.4 million) one-time general and administrative expense due to a management bonus attributed to an unrealized capital gain resulting from the commencement of the trading of shares of the Company's majority-owned subsidiary, Gold Frost Ltd., on London's AIM market on March 9, 2006. Excluding the effect of the management bonus attributed to the unrealized capital gain, the Company's operating income for the first quarter of 2006 was NIS 6.3 million (US $1.3 million), a 163.9% increase over operating income reported in the first quarter of 2005.

The Company's first quarter 2006 net income was NIS 22.7 million (US $4.9 million), or NIS 2.63 (US $0.56) per share compared to a net income of NIS 1.9 million (US $0.4 million), or NIS 0.22 (US $0.05) per share, recorded in the first quarter of 2005. Net income for first quarter of 2006 includes a one-time unrealized capital gain due to the public listing of the shares of Gold Frost, Ltd. Excluding the effect of the unrealized capital gain, the Company's net income from operations for the first quarter of 2006 was NIS 4.9 million (US $1.1 million), a 164.1% increase over net income reported in the first quarter of 2005.

Mr. Williger continued, "The broad based strength of our business enabled us to deliver record results, both on the top and bottom lines. Moreover, we are able to differentiate our company through our success at becoming a high margin business in a low margin industry."

Furthermore, Mr. Williger added, "With these positive quarterly results, coupled with being debt free and cash positive, we believe that we are in a strong financial position to achieve our goal of expanding our foothold in the lucrative U.S. and European food markets. At present, we are in the process of identifying possible U.S. and European distributors and are optimistic about the outcomes."

About G. Willi-Food International, Ltd.

G. Willi-Food International Ltd. is one of Israel's largest food importers and a single-source supplier of one of the world's most extensive ranges of quality kosher food products. It currently imports, markets and distributes more than 400 food products manufactured by some 100 top-tier suppliers throughout the world to more than 1,000 customers. The Company excels in identifying changing tastes in its markets and sourcing high-quality kosher products to address them. For more information, please visit the Company's website at www.willi-food.co.il.

Except for historical information contained herein, the matters set forth in this press release are forward-looking statements that are dependent on certain risks and uncertainties, including such factors, among others, as market acceptance, market demand, pricing, competition, changing economic conditions and other risk factors detailed in the Company's SEC filings.

NOTE A: Convenience Translation to Dollars

The convenience translation of New Israeli Shekels (NIS) into U.S. dollars was made at the rate of exchange prevailing on March 31, 2006: U.S. $1.00 equals NIS 4.665. The translation was made solely for the convenience of the reader.

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