Ace chain – profit of NIS 36 million, value of NIS 400 million – capital market

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Ace Retail
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It grew by 2020 by 18% to NIS 672 million. Operating profit increased threefold to NIS 50 million. EBITDA amounted to NIS 59 million – an increase of 130% compared to last year and the profit in the bottom line increased by 240% to NIS 36 million. The increase in activity is mainly attributed to the accelerated growth of 130% in online sales through the company’s websites. Online sales make up about 17% of the company’s sales.

In the fourth quarter, sales amounted to NIS 202 million, compared with NIS 144 million last year, an increase of 40%; EBITDA for the quarter amounted to NIS 19 million. An increase of 240% compared to last year. The net profit amounted to NIS 11 million, compared with NIS 340,000 in the corresponding quarter.

About two months ago, Ace issued its shares on the Tel Aviv Stock Exchange at a value of about NIS 400 million. This is also the current value area. The company’s data express a profit multiplier of 10-11. Is there a reason for this? Investors seem to think the results are good because of the Corona, but when you look at the results over time, you realize that even if there is increased demand for certain products and they need to be neutralized, the results grow over time (especially online) and the company Home Center.The next quarters will be critical for investors who will examine the results and from them will conclude whether this is a significant deviation or not.

Meanwhile, the company’s board of directors has decided to convey confidence in the stock. The company will make a self-purchase in the amount of NIS 10 million

Over the past year, Ace has focused on logistics improvements, expanding online and strengthening the synergy between online activity and physical stores.

In the field of logistics, The company moved into self-management of the main marlog in early 2020. The expansion of online in particular and in the company’s operations in general led the company to rent additional marlog during 2020. At the end of 2020, Ace signed an additional marlog lease agreement for online operations in the north Which will start operating in the coming weeks.

Online sales – The company has significantly expanded its products on the site, including entering additional categories including pharma, sports, children and leisure products. The company defined the Market Place area as a growth engine, and as mentioned, these sales grew by 133% and constitute about 175 of the group’s operations as a whole.

In addition, the company connects the online sites to the physical stores in that close to half of the buyers on the site choose to collect the products independently from the physical stores, an activity that produces additional purchases for the physical stores during the self-collection.

Against the background of the publication of the results, Itzik Ozana, CEO of the Ace Group, said: “We have met strategic goals that we have set for ourselves in recent years that have enabled us to successfully deal with the corona crisis. These moves put us firmly into 2021 and will serve us forward, furthering the company’s growth process. In the online field, the company entered 2020 with a mature and developed infrastructure, which allowed it to stand out from other players in the industry.