Opening ceremony of the Tel Kashish - Sumach section, 2019. Shapir Engineering is perhaps the best-known infrastructure company in Israel (photo: official website, courtesy of Shapir Engineering)
While Israeli high-tech companies are examining the feasibility of moving their operations abroad, Israeli infrastructure companies are working hand-in-hand with the country and working to locate projects to deepen their operations there, while expanding their grip on its development budgets. The Israeli infrastructure giant Shapir Engineering, for example, is building and managing some of the country's largest projects in the form of a
road 6 North Crossing, the expressway, the light trains in Jerusalem and Gush Dan, the logistics supply center of the IDF, and others, reports its financial results for 2022. It recorded a significant increase in its revenues.
Revenues amounted to approximately NIS 4.5 billion in revenue for this year, which is an increase of approximately NIS 655 million (17%) compared to its revenues in 2021. The
main increase was felt from the company's infrastructure activities, which increased by approximately NIS 537 million, mainly due to the increase in the pace of work on projects such as the light rail in Jerusalem and the logistics supply centers of the IDF.
Along with it, there was an increase in industrial activity, which contributed an additional NIS 381 million, which was mainly due to the change in the price increases of the raw materials and a merger with the company "Evrot Industries" which was acquired by Shapir at the end of 2021. The company also began to recognize for the first time the income of its activities in the shipping and logistics sector, which
began its activity in August 2022, and an increase in its franchising activity.
In the face of all this, it suffered a decrease of approximately 515 million shekels in the income of its real estate activity, which results from the completion of the delivery of the apartments in the price-to-resident projects in Harish and Rosh Ha'Ein.
Shai Lindner, Chief Financial Officer of Shapir Engineering (Photo: Rudy Almog)
The reason for the decrease in profit: revaluation of the value of assets
However, despite the increase in revenues, the company's operating profit decreased by approximately 10.4% and was NIS 608 million for the period of the report, as well as the annual net profit which decreased by approximately 5.3% and was NIS 427 million for the period. This is mainly due to revaluations (revaluation,
mainly to the value of assets), alongside an increase of NIS 26 million in sales and marketing expenses and NIS 43 million in administrative and general expenses. The company also deepened its losses in the companies it holds from NIS 5 million to NIS 27 million. The net profit attributable to shareholders was
388 million shekels and 1.07 shekels per share, for which the company announced the distribution of a dividend (profits) to its shareholders in the amount of approximately 70 million shekels, similar to the dividend it distributed in April 2022. We note that
last March Shapir was selected for the establishment and operation of the government Kiryat "Genery 3", which is a project for a period of about 25 years, with an estimated amount of about NIS 2.1 billion.
Shai Lindner, Chief Financial Officer of Shafir Engineering
: "During 2022, the company continued its entry into the fields of energy and logistics as future growth engines, we completed the acquisition of the logistics activities of the Fritz Company, and began the restoration work of the desalination plant in Ashdod and the construction of the power plant. Our core activities in the field of infrastructure provide us with additional growth engines for 2023, and beyond" .
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