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Strauss Group’s global coffee operations delivered strong profit growth in Q2 and H1 2026, as improved margins helped offset lower revenues caused by foreign exchange headwinds and declining green coffee prices.
The Israeli food and beverage company reported double-digit earnings growth across both its domestic and international coffee businesses, with its Coffee International segment recording a 44.3 per cent increase in Q2 EBIT to NIS 148 million (US$49.9) and a 78.2 per cent rise in H1 EBIT to NIS 280 million (US$94.5 million).
Coffee International revenue decreased 13.1 per cent year-on-year in Q2 to NIS 1.334 billion (US$450 million), while H1 sales declined 9.1 per cent to NIS 2.656 billion (US$900 million). Strauss attributed the decline primarily to the stronger Israeli shekel and lower selling prices at its Brazilian joint venture, 3corações, following the fall in green coffee prices. On a like-for-like basis, Q2 revenue was down 3.9 per cent and H1 revenue declined 2.2 per cent.
Despite the softer top-line performance, profitability improved significantly. The Coffee International division increased its EBIT margin to 11.1 per cent in Q2, up from 6.7 per cent a year earlier, while H1 EBIT margin rose to 10.5 per cent from 5.4 per cent.
A key contributor was Brazil’s 3corações business, in which Strauss holds a 50 per cent stake. Second-quarter revenue at the operation fell 15 per cent to NIS 945 million (US$319 million), or 8.2 per cent on a like-for-like basis, reflecting lower selling prices. However, the company reported volume growth in its roasted and ground coffee segment, helping lift EBIT by approximately 25 per cent to about NIS 110 million.
For the first half of the year, 3corações generated revenue of NIS 1.856 billion, down 12.4 per cent year-on-year, while EBIT increased 71.2 per cent to approximately NIS 202 million (US$68.2 million).
Strauss also reported positive momentum across its Central and Eastern European coffee operations, which include Poland, Romania, Russia, and Ukraine. While reported Q2 revenue declined 8.3 per cent due to currency impacts, sales increased 6.4 per cent on a like-for-like basis. First-half revenue was flat at NIS 800 million (US$270 million), but grew 11 per cent on a like-for-like basis.
In Israel, Strauss’ coffee division delivered improved profitability despite the impact of the divestment of its Coffee-To-Go retail chain. The Coffee Israel business recorded Q2 revenue of NIS 190 million (US$64.1 million), down 11.1 per cent year-on-year. Excluding the divested retail operation, revenue declined by just 3.1 per cent. EBIT increased 35 per cent, lifting margin to 15.4 per cent.
Overall, Strauss Group highlighted Coffee International as one of its strongest-performing segments during the period, alongside its Israel operations, helping drive substantial growth in group profitability despite a challenging market environment and ongoing currency pressures.
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Source: Online/GFMM
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