Novolog reports mark end of an era: slight revenue growth, low profitability amid financing costs
Novolog released its Q2 2026 results following a management overhaul and the consolidation of the Pozis family's control. Net profit dropped to 541,000 shekels from 4.6 million shekels in the same quarter last year, driven by higher financing expenses.
Following the announcement of a complete replacement of the board of directors and management at Novolog, amid the resolution of a power struggle and the consolidation of the Pozis family's dominance, the company published its reports for the second quarter of 2026 today (Thursday).
Novolog's revenue for the first half of the year recorded a slight increase of approximately 1% to 957 million shekels, while operating profitability decreased by about 1.5% to 13.7 million shekels. Net profit fell significantly to approximately 1 million shekels, compared to 5.8 million shekels in the first half of last year, due to higher financing expenses. The company noted that the rise in financing costs is primarily linked to the dollar exchange rate and increased interest expenses.
On a quarterly basis, revenue in the second quarter grew by 2% to 452 million shekels. Operating profitability decreased by 13% to 8.6 million shekels, and net profit stood at 541,000 shekels, compared to 4.6 million shekels in the corresponding quarter last year, due to the aforementioned financing costs.
The company's cash reserves currently stand at 204 million shekels, compared to 218 million shekels at the end of the same period last year.
The logistics division, Novolog's largest segment operating in drug distribution, recorded stable revenue. The primary growth came from the healthcare services division, which also saw an increase in profit. The digital health division also grew, though its overall activity remains small compared to other segments.
The struggle for control
These reports are signed by CEO Aviad Busi, who announced yesterday (Wednesday) that he is leaving the company after three years. His departure, along with that of CFO Yaniv Vidavsky, comes against the backdrop of drama at Novolog: about two weeks ago, Oded Pozis announced his intention to replace the board of directors. Simultaneously, an offer arrived from Eli Dahan, controlling shareholder of the Movement group, to invest 100 million shekels for a 21% stake—a move that could have balanced Dahan's influence with that of the Pozis family.
The event concluded with the Pozis family purchasing shares held by the Arkin and Phoenix groups for 91 million shekels at a price 45% higher than the market value prior to the struggle, reaching a 44% stake in the company. Consequently, the Pozis family solidified its control. The board of directors resigned, and Oded Pozis, who took over the family's involvement in the company from his father this May, appointed an alternative board and named himself chairman.
It appears Pozis intends to start fresh, with full control and a break from the past. Novolog, which soared during the COVID-19 pandemic, has faced difficulties in recent years: initially due to write-offs from pandemic-era acquisitions, leading to a 39 million shekel loss in 2023, and later a 2025 crisis following the implementation of a new SAP ERP system, which disrupted operations for several months. In response, some customers left or diversified their activities.
While Novolog is gradually rebuilding revenue, there are concerns that the current mix of activities and clients cannot sustain significant profitability without major changes. Busi and the previous board managed to implement only the stage of reducing non-core activities before they could pursue further acquisitions. It is expected that Pozis will now draft a new strategic plan with a different CEO.
