After the consumer storm caused by its intention to raise the prices of its products, including Tuna Starkist, the importer of consumer products and food is expanding diplomat its business in the field of dietary supplements with an investment of NIS 96 million.
It seems that the current investment is aimed at improving the profitability of the company’s business, which has suffered in recent times. Diplomat, led by CEO Noam Weiman, recently published relatively weak reports for the second quarter with a 41% drop in net profit, which was NIS 17.6 million.
Among other things, the company calculated an increase in sales and marketing expenses that resulted from an increase in storage and transportation costs as a result of an increase in inventory, as well as from various increases in costs, mainly wages and fuel.
Bigdam sells Neve Pharma products on Amazon
Now Diplomat, which trades at a value of about NIS 1.3 billion (a 12% decrease since the beginning of the year), is reporting the purchase of two companies – 65% of Neve Pharma’s shares for NIS 81 million and 90% of Bigam for NIS 15 million, with an option to purchase the rest of their shares .
Neve Pharma, founded by Nitzan Primor, engages in the development and marketing of nutritional supplements, mainly magnesium supplements, as well as medical accessories in the field of “ear, nose and throat”, which it sells in Israel to pharmacies, health food stores and health insurance companies. It is also involved in the development and production of private brands for pharmaceutical companies in Europe, Australia and more. Bigdam, which began substantial activity in 2020, and engages in online sales abroad of Neve Pharma products (mainly through Amazon).
The results presented by the acquired companies show that this is a growing and profitable activity. Neve Pharma recorded revenues of NIS 41.8 million in 2021, an 11% increase compared to the previous year, when the net profit doubled to NIS 9.2 million. Bigdam posted a turnover of NIS 8.8 million last year, double that of 2020, and a profit of NIS 1.85 million.