Tomer Mazon Reports 21.3 Million Shekel Loss Amid Inventory and Governance Crisis

Tomer Mazon reported a net loss of 21.3 million shekels for the first half of the year, driven by a one-time expense related to its public listing in May. Trading in the company's shares remains suspended.

Financial Performance and Inventory Crisis

During the first half, sales grew by 7.8% to 129.5 million shekels. However, gross profitability declined to 19.4% of sales, compared to 21.5% in the same period last year. This drop was attributed to lower revenues from storage and logistics services, as well as inventory write-offs caused by pests. Operating profitability also fell to 4.6% of sales, down from 5.7%.

The crisis at the food importer began following the resignation of CFO Avital Cherny in August, just a day after her appointment, after she discovered inventory discrepancies in past financial statements. An independent committee, assisted by professional advisors and legal counsel, investigated the findings and distinguished between errors, control failures, and intentional actions.

Corporate Governance and Bank Waivers

Following the findings, the company decided to remove founder, CEO, and Chairman Doron Kimelov from the chairmanship and subordinate the compliance division to Guy Freeman, the recently appointed CFO and Deputy CEO. The company plans to apply for Tel Aviv Stock Exchange approval to resume regular trading.

"The committee adopted the recommendations of the investigator alongside additional decisions and steps in control, supervision, and corporate governance," the company stated.

Additionally, Tomer Mazon breached financial covenants with its banking corporations based on its 2025 reports, classifying all loans—including 32.1 million shekels in long-term debt—as current liabilities. The company secured waivers from financing banks, which agreed to withhold immediate repayment demands until new financial covenants based on IFRS standards are formulated by the end of November.