The company noted that the sales growth was driven by the introduction of new products and by the timing of the Passover festival, which fell during the first quarter of this year.
Gross profit for the first quarter of 2012 decreased by 12.8% to NIS15.7m ($4.2m) compared to the previous year. First quarter gross margin was 21.3% compared to gross margin of 25.6% for the same period in 2011.
The decrease in gross profit and gross margins was primarily due to increase in global prices of food products as well as reductions in the prices of certain products in response to consumer concern. The company expects the decline in its gross margins to continue in the second quarter of 2012 compared to 2011 second quarter's gross margins.
Willi-Food's operating income for the first quarter of 2012 decreased by 25.4% to NIS4.7m ($1.3m) compared to the previous year.
The company's net income in the first quarter of 2012 decreased 21.8% to NIS4.8m ($1.3m) from NIS 6.2m ($1.7m) recorded in the first quarter of 2011.
Willi-Food chairman Zwi Williger said that in Israel, economic uncertainty coupled with changes in the Israeli market and ongoing consumer demand for price reductions is expected to negatively affect the company's gross margins in the second quarter of 2012 compared to 2011 second quarter's gross margins.
"Our foreseeable challenge will be to manage the cost of our products and our other expenses in order to accommodate the continued desire of our customers to acquire lower cost products," Williger added.
The company noted that it plans to use cash on hand to acquire synergetic companies.
