Tel Aviv-listed food and beverage conglomerate Strauss Group (TASE: STRS) delivered a sharp profitability turnaround in its second quarter, with EBIT climbing 41.9% to NIS 363 million and net income attributable to shareholders more than doubling to NIS 195 million — a 113.3% year-over-year gain — for the period ended June 30, 2026.

Group revenues on a reported basis declined 6.7% to NIS 2,867 million, but stripping out foreign-exchange translation effects, like-for-like sales contracted just 1.9%. Free cash flow swung from negative NIS 89 million a year ago to positive NIS 150 million, and the net debt-to-EBITDA ratio improved to 1.5x from 2.4x. The board declared a semi-annual dividend of NIS 180 million, approximately NIS 1.54 per share, payable September 3, 2026.

Segment Breakdown

Strauss Israel — the company's domestic food platform spanning health-and-wellness dairy and snacks-and-confectionery — generated Q2 EBIT of NIS 198 million, up 46.0%, for a 15.2% EBIT margin. Excluding a NIS 27 million one-time insurance receipt, the underlying margin was 13.2%, still a meaningful step up from the prior-year 10.2%. The Snacks & Confectionery sub-segment swung from near break-even to NIS 52 million EBIT in the quarter, partly reflecting the insurance windfall; on an organic basis EBIT reached NIS 25 million at an 8.2% margin versus essentially zero the year before. The divestiture of the Coffee-To-Go retail chain (Elite Coffee stores) masked underlying Coffee Israel revenue growth; excluding that exited activity, domestic coffee revenues were down only 3.1% in Q2.

Coffee International, which houses the 50%-owned Brazilian joint venture 3corações and Central and Eastern Europe operations across Poland, Romania, Russia, and Ukraine, posted Q2 EBIT of NIS 148 million, up 44.3%, expanding its margin from 6.7% to 11.1%. The shekel's appreciation against the Brazilian real and other regional currencies was the primary drag on reported revenue, which fell 13.1%; on a like-for-like basis the decline was 3.9%. Within that, 3corações saw volume growth in its roast-and-ground segment offset lower selling prices that tracked declining green-coffee commodity costs. CEE revenues rose 6.4% in like-for-like terms in Q2.

Cash Flow and Balance Sheet

Strauss Water, the group's connected water-purifier business and 49%-owned Haier Strauss Water joint venture with Haier, grew Q2 revenues 7.1% to NIS 233 million, with EBIT up 4.9%. The H1 picture for Strauss Water was murkier — operating income fell 13.9% for the first half, attributed to elevated costs related to the conflict in Israel in the first quarter.

For the full first half, group EBIT reached NIS 679 million, up 52.9% and representing an 11.6% EBIT margin versus 7.3% in H1-2025. H1 net profit attributable to shareholders rose 119.3% to NIS 376 million. Operating cash flow for H1 swung from negative NIS 296 million to positive NIS 366 million. Capital expenditure was disciplined, coming in at NIS 262 million net for H1, roughly 9.0% below the prior-year period, underscoring a tighter approach to asset allocation across the group's manufacturing and distribution footprint.

Shai Babad, President and CEO of Strauss Group, characterized the results as structural rather than episodic: "This is not a one-quarter move but the result of a clear path, disciplined execution and focus on activities in which we have a real advantage." The company's Aa1.il credit rating from Midroog was affirmed with a stable outlook during the period, providing additional financial flexibility as the group continues investing in brand and innovation across its beverage and food categories.

For foodservice operators and buyers tracking commodity dynamics, the Strauss results illustrate a key industry dynamic: coffee manufacturers with vertical exposure to green-coffee pricing are translating falling input costs into margin recovery even where top-line volume growth remains elusive. That pattern is visible across the global coffee supply chain as arabica and robusta prices retreat from 2024–2025 highs, benefiting processors with significant roast-and-ground and at-home coffee exposure.

Written by Michael Politz, Author of Guide to Restaurant Success: The Proven Process for Starting Any Restaurant Business From Scratch to Success (ISBN: 978-1-119-66896-1), Founder of Food & Beverage Magazine, the leading online magazine and resource in the industry. Designer of the Bluetooth logo and recognized in Entrepreneur Magazine's "Top 40 Under 40" for founding American Wholesale Floral, Politz is also the Co-founder of the Proof Awards and the CPG Awards and a partner in numerous consumer brands across the food and beverage sector.