Israeli-based kosher food importer and supplier G. Willi-Food International has posted net income for the third quarter of ILS595,000 (US$155,458), down from ILS3.8m in the third quarter of 2006.

Third-quarter revenues fell by 21% to ILS59.7m, while gross profit was 13% down at ILS11.8m.

Zwi Williger, president and COO of Willi-Food, said the third-quarter results were in line with its expectations.

"In this period, nearly all of our shortfalls can be attributed to gross margin decline in our dairy business," Williger said. "As previously stated, Willi Food and the global dairy industry continues to experience cost pressures due to weather related problems, reduced milk production, cessation of EU dairy export subsidies at the same time that consumption and demand for dairy has increased in growing emerging markets. These factors have negatively impacted Willi Food's near-term sales and gross margins on cheeses and other products."
Williger said the company expected this trend to continue through the remainder of the year, but that it anticipated the cost of raw food materials would stabilise by mid-2008. "In the interim, we are successfully leveraging our infrastructure, hedging our strategic direction through smart acquisitions and setting the stage for growth in 2008," he added.

For the nine-month period, revenues increased by 27% to ILS186.9m and gross profit by 17% to ILS46.0m, while operating income rose marginally from ILS13.7m to ILS14.0m. Net income for the first nine months of 2007 fell to ILS10.0m, from ILS29.1m.