Two Israeli Companies Reporting Double-Digit Net Profit Growth
Mineral company ICL beat analysts' forecasts, reporting a 35% increase in adjusted net profit. Delta Galil nearly doubled its net profit, driven in part by a customs refund from US authorities.
The mineral company ICL beat analysts' forecasts and reported an increase of approximately 35% and 17% in adjusted net profit and sales, respectively. Delta Galil almost doubled its net profit due to a customs refund from US authorities, but even excluding it, it showed an increase of over 20% in the bottom line.
Rise in industrial product prices fuels ICL's strong quarter
The mineral company reported double-digit growth in revenue and adjusted net profit, which jumped by 35%. The positive results were supported by an increase in bromine prices, while the potash and phosphate sector also grew significantly.
ICL beat forecasts and brought in $2.135 billion in the second quarter, 6% above forecasts that predicted slightly over $2 billion. ICL also recorded a 35% jump in its adjusted net profit and 47% in operating profit in the second quarter compared to the same quarter last year, which leads to a significant increase in its share value in stock market trading. EBITDA also rose significantly from $351 million to $448 million.
The sector leading the rise is industrial products (bromine), whose EBITDA more than doubled from $69 million to $130 million, due to a jump in global bromine prices, along with an increase in production. The potash and phosphate sector also rose significantly, but the "growing solutions" sector for agriculture actually weakened slightly in the current quarter compared to the same one last year. However, ICL points to long-term growth since 2020 in this sector.
In addition, in the current quarter, ICL announced a significant organizational change: the company's divisions will not be divided by product type, but by target markets: nutrition solutions for food and beverages, industrial products for the electronics, energy, and construction markets, growing solutions for agriculture, and essential minerals (potash and phosphates). The new organizational structure will begin operating from 2027, but the report on it begins now.
Furthermore, ICL reports on a cost-saving plan that is "designed to reduce the company's cost base, support increased profitability margins, strengthen cash flow, and increase the company's profit potential." Implementation of the plan will begin during the third quarter, and they expect to achieve savings of $350 million by the end of 2028 with its help, with the first contribution starting in 2027. The company continues to confirm the existing forecast for adjusted EBITDA of $1.5-1.7 billion.
A positive quarter for Delta Galil: net profit nearly doubles
The unusual jump in net profit is due to a one-time customs refund of $33 million that the company received from US authorities, although even excluding the refund, the company showed a nice improvement with a 22% increase in operating profit and 27% in net profit.
Delta Galil showed a strong quarter with a 9% increase in revenue to a record $511.6 million, alongside a sharp improvement in profitability. Gross profit in the second quarter of 2026, according to the company's reports, grew by 26%, operating profit jumped by 70%, and net profit almost doubled compared to the same quarter.
However, a significant part of the improvement was due to a one-time customs refund of $33 million that the company received from US authorities. Even excluding that refund, Delta showed a nice improvement, with a 22% increase in operating profit and 27% in net profit, but the gap between the reported figures and the results excluding the one-time event illustrates that part of the jump does not stem from current operations.
Despite the strong results, the company chose to reaffirm its forecast for 2026 and not raise it, a decision that may raise questions among investors regarding the rest of the year. On the other hand, Delta continues to show strong cash flow, a decrease in leverage, and record equity, data that indicate that the business trend remains positive even beyond the impact of the customs refund.
"The results of the second quarter and the results of the first half of the year demonstrate that our growth initiatives are reflected in increased sales to most strategic clients as well as in our brands, in the expansion of profitability, and in the increase of cash flows," said Isaac Dabah, CEO of Delta Galil. "In addition to the customs refund that provided an additional contribution to the results and cash flows, the strength of our performance reflects the continued successful implementation of our strategy and the investments we have made in innovation, in the brands we own, in production flexibility, in global procurement sources, and in our distribution capabilities. In light of the positive momentum in all business activity and the decrease in financial debt compared to last year, we believe that Delta Galil is in a better position than ever to continue to show profitable and sustained growth during the remainder of 2026 and even beyond."
