After an 800% jump in 3 years: Bet Shemesh Engines stock leaps following reports
The jet engine parts exporter doubled its profit to $16 million and grew in all parameters, even though the strengthening of the shekel reduced operating profit by about $5.6 million. The order backlog grew to $3.3 billion.
Bet Shemesh Engines, a manufacturer and refurbisher of jet engine parts for military and civilian aircraft, published its second-quarter 2026 reports, and the stock reacted with a jump after having already risen by over 800% in the last 3 years.
The line that excited investors: net profit more than doubled to $16 million, compared to about $7.6 million last year, and this despite a significant headwind of the strengthening of the shekel against the dollar. Revenue rose by about 18.9% to $91.4 million, and the company relies on a huge order backlog of $3.3 billion.
The doubling of net profit is impressive, but it does not stem only from operational activity. Three factors pushed it: a jump in operating profit, a sharp decrease in financing expenses (about $1.2 million compared to about $2.8 million last year, thanks to credit repayment), and zero tax expenses that stemmed mainly from the influence of the dollar exchange rate on accounting tax calculations in Israel.
A "cleaner" number for evaluating the activity is the operating profit, which grew by about 31.6% to $17.3 million, and the EBITDA, which rose by about 23.6% to $21 million.
Bet Shemesh Engines is an exporter that reports in dollars but bears a significant portion of its expenses in shekels, so the strengthening of the shekel hurt operating profit by about $5.6 million. The damage is also evident in the gross profit, which grew by only 9.6% and its rate decreased from 25.1% to 23.1% of revenue. And yet, operating profit jumped.
The secret lies in the parts sector: its operating profit jumped by about 78.3% to $8.5 million, thanks to improved production processes. The engine sector added an operating profit of about $9.4 million, which included for the first time about $1 million from the company's share in the profits of the Jet Cat Defense partnership.
Bet Shemesh Engines' framework agreements amount to about $3.3 billion, a figure that is growing steadily against the backdrop of increasing demand in defense and civil aviation. In June, the FIMI fund realized part of its holdings by selling shares in the amount of about half a billion shekels. On the other hand, the company's balance sheet is strong: equity of about $329.9 million, which constitutes about 66% of the total balance sheet, and a negligible net financial debt of only about $4.2 million.
Ram Drori, CEO of Bet Shemesh Engines, stated:
"We are concluding another quarter of double-digit growth in revenue and an increase in operating profit, this despite the negative impact of the strengthening of the shekel exchange rate against the dollar. The parts sector continues the growth trend, and we estimate that the growth in this sector will continue due to the increasing demand in the aviation industry. The balanced growth, relying on both the civil aviation market and the military aviation market, alongside our order backlog, constitute a solid foundation for the continued development and growth of the company in the coming years."
