Hilan Ltd. — Interim / Quarterly Report 2024

Apr 28, 2025

HILAN LTD.

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2024

INDEX

	Page
Auditors' Letter	2
Condensed Consolidated Balance Sheets	3 - 4
Condensed Consolidated Statements of Comprehensive Income	5
Condensed Consolidated Statements of Changes in Equity	6
Condensed Consolidated Statements of Cash Flows	7 - 9

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This document is an unofficial translation of part of the Hebrew original of the Financial Reports published by the Company on March 18, 2025 (reference no.: 2025-01-017771) on the Tel-Aviv Stock Exchange website and the Israeli Securities Authority website (hereinafter: the "Hebrew Version"). This document is provided for convenience purposes only. This document is not an official translation and has no legal standing. The Hebrew Version is the sole legally binding version. In case of discrepancy or inconsistency between this translation and the Hebrew Version, the Hebrew Version shall prevail .

';lkKost Forer Gabbay & Kasierer 144 Menachem Begin Road, Building A, Tel-Aviv 6492102, Israel

Tel: +972-3-6232525 Fax: +972-3-5622555 ey.com

To Hilan Ltd.

We have audited, in accordance with generally accepted auditing standards in Israel, the consolidated balance sheets of Hilan Ltd. ("the Company") as of December 31, 2024 and 2023 and the related consolidated statements of comprehensive income, changes in equity and cash flows for each of the three years in the period ended December 31, 2024.

Based on our audits, in our report dated March 17, 2025, we expressed an unqualified opinion on those statements.

The accompanying financial statements, which are derived from the abovementioned financial statements, are condensed financial statements and do not include disclosures required by International Financial Reporting Standards. If the omitted disclosures were included in the accompanying financial statements, they might influence the user's conclusions about the consolidated financial position, results of operations and cash flows of the Company and subsidiaries. Accordingly, the accompanying financial statements are not designed for those who are not informed about such matters.

Tel-Aviv, Israel March 17, 2025 KOST FORER GABBAY & KASIERER A Member of Ernst & Young Global

CONDENSED CONSOLIDATED BALANCE SHEETS

		December 31,
	2024	2023
		NIS in thousands
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	343,005	300,633
Trade receivables	828,202	791,483
Other accounts receivable	51,365	(*) 38,027
Fund held for clients	576,682	)*( 117,115
Taxes receivable	3,700	4,419
Inventories	1,985	4,218
	1,804,939	1,255,895
NON-CURRENT ASSETS:
Investments in companies accounted for at equity	3,330	5,161
Investments in financial assets at fair value through profit or loss	6,373	3,654
Long-term loans and receivables	29,450	15,691
Property, plant and equipment	110,611	77,308
Right-of-use assets	216,181	213,296
Intangible assets	210,309	157,188
Goodwill	707,740	597,037
Employee benefit assets, net	47	5,919
Deferred taxes	18,142	15,252
	1,302,183	1,090,506
	3,107,122	2,346,401

(*) Reclassified.

CONDENSED CONSOLIDATED BALANCE SHEETS

December 31,
2024	2023
	NIS in thousands
	-
	24,375
	5,925
	48,939
	311,182
	(*) 405,083
	(*) 117,115
	15,734
93,186	93,218
	1,021,571
30,000	50,000
	19,396
	166,995
	22,255
	54,927
356,650	313,573
28,853	28,838
212,776	209,846
	-
	5,970
	)69,625(
	820,608
	995,637
15,409	15,620
1,155,025	1,011,257
3,107,122	2,346,401
	2,330 20,000 17,258 58,002 316,058 495,681 575,985 16,947 1,595,447 16,851 191,805 32,326 85,668 2,441 6,137 (111,700) 1,001,109 1,139,616

(*) Reclassified.

March 17, 2025

Date of approval of the	Avi Baum	Eli Zybert	Tal Waiser
financial statements	Chairman of the Board	CEO	CFO

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

	Year ended December 31,
	2024 2023		2022
		NIS in thousands (except per share data)
Revenues Cost of revenues	2,838,589 2,195,128	2,588,797 2,013,260	2,232,859 1,716,678
Gross profit	643,461	575,537	516,181
Selling and marketing expenses	107,596	99,962	103,626
General and administrative expenses	209,009	191,096	172,478
Other income	3,081	4,298	-
Operating income	329,937	288,777	240,077
Finance income	27,482	15,108	13,796
Finance expenses	(35,544)	)23,483(	)23,064(
Group's share of loss of company accounted for at equity	(1,831)	)331(	)1,472(
Income before taxes on income	320,044	280,071	229,337
Taxes on income	72,439	62,934	55,042
Net income	247,605	217,137	174,295
Other comprehensive income (net of tax effect): Amounts that will not be subsequently reclassified to profit or loss: Remeasurement gain from defined benefit plans Profit from cash flow financing transactions	2,789 -	1,569 -	5,126 2,524
Amounts that will be or that have been reclassified to profit or loss when specific conditions are met: Gain (loss) from cash flow hedges Reclassification to profit or loss for cash flow hedges	819 (864)	)333( )622(	97 778
Adjustments arising from translating financial statements of
foreign operations	211	2,964	11,501
Total other comprehensive income	2,955	3,578	20,026
Total comprehensive income	250,560	220,715	194,321
Net income attributable to:
Equity holders of the Company	246,520	216,160	173,513
Non-controlling interests	1,085	977	782
	247,605	217,137	174,295
Total comprehensive income attributable to:
Equity holders of the Company	249,464	219,745	193,479
Non-controlling interests	1,096	970	842
	250,560	220,715	194,321
Net earnings per share attributable to equity holders of the Company (in NIS):
Basic net earnings	10.75	9.42	7.61
Diluted net earnings	10.50	9.18	7.48

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

	Attributable to equity holders of the Company
	Share capital	Share premium	Treasury shares	Reserve from share-based payment transactions	Reserve from transactions with non-controlling interests	Foreign currency translation reserve	Retained earnings	Total	Non controlling interests	Total equity
Balance as of January 1, 2022	28,468	144,109	(5,217)	1,965	NIS in thousands (69,625)	(8,408)	504,502	595,794	9,411	605,205
Net income Total other comprehensive income, net	- -	- -	- -	- -	- -	- 14,858	173,513 5,108	173,513 19,966	782 60	174,295 20,026
Total comprehensive income Dividend to equity holders of the Company	- -	- -	- -	- -	- -	14,858 -	178,621 )22,912(	193,479 )22,912(	842 -	194,321 )22,912(
Issue of share capital (net issue expenses of NIS 470 thousand) Transfer from a translation fund for the acquisition of a	370	70,954	-	)2,822(	-	-	-	68,502	-	68,502
consolidated company Cost of share-based payment	- -	- -	- -	- 857	- -	)2,498( -	- -	)2,498( 857	)26( 2,657	)2,524( 3,514
Balance as of December 31, 2022	28,838	215,063	)5,217(	-	)69,625(	3,952	660,211	833,222	12,884	846,106
Net income Total other comprehensive income (loss), net	- -	- -	- -	- -	- -	- 2,018	216,160 1,567	216,160 3,585	977 )7(	217,137 3,578
Total comprehensive income Dividend to equity holders of the Company Non-controlling interests arising from initially consolidated	- -	- -	- -	- -	- -	2,018 -	217,727 )57,330(	219,745 )57,330(	970 -	220,715 )57,330(
companies Cancellation of treasury shares Cost of share-based payment	- - -	- )5,217( -	- 5,217 -	- - -	- - -	- - -	- - -	- - -	113 - 1,653	113 - 1,653
Balance as of December 31, 2023	28,838	209,846	-	-	)69,625(	5,970	820,608	995,637	15,620	1,011,257
Net income Total other comprehensive income, net	- -	- -	- -	- -	- -	- 167	246,520 2,777	246,520 2,944	1,085 11	247,605 2,955
Total comprehensive income Dividend to equity holders of the Company Issue of share capital Exercise of options by non-controlling interest holders Cost of share-based payment	- - 15 - -	- - 2,930 - -	- - - - -	- - (2,930) - 5,371	- - - (42,075) -	167 - - - -	249,297 (68,796) - - -	249,464 (68,796) 15 (42,075) 5,371	1,096 - - (2,303) 996	250,560 (68,796) 15 (44,378) 6,367
Balance as of December 31, 2024	28,853	212,776	-	2,441	(111,700)	6,137	1,001,109	1,139,616	15,409	1,155,025

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

	Year ended December 31,
	2024	2023	2022
	NIS in thousands
Cash flows from operating activities:
Net income	247,605	217,137	174,295
Adjustments to reconcile net income to net cash provided by operating activities:
Adjustments to the profit or loss items:
Depreciation and amortization	114,064	106,415	100,535
Cost of share-based payment	6,367	1,653	3,514
Gain from sale of property, plant and equipment, net	(391)	)1,044(	)36(
Gain from deduction of Right of use asset	(109)	)22(	)142(
Finance expenses, net	2,622	8,781	8,878
Group's share of losses of company accounted for at equity	1,831	331	1,472
Taxes on income	72,439	62,934	55,042
Change in employee benefit liabilities, net	6,948	2,637	1,190
	203,771	181,685	170,453
Changes in asset and liability items:
Decrease (increase) in trade receivables	9,218	)62,762(	)141,095(
Decrease (increase) in other accounts receivable	1,116	)8,945(	4,326
Decrease (increase) in inventories	2,233	)3,460(	)758(
Increase (decrease) in trade payables	(30,060)	40,704	66,812
Increase in other accounts payable	61,749	33,538	27,431
Increase (decrease) in deferred revenues and customer
advances	(8,593)	22,494	5,662
	35,663	21,569	)37,622(
Cash paid and received during the year for:
Interest paid	(14,046)	)8,805(	)6,870(
Interest received	9,619	5,581	245
Taxes paid	(64,878)	)63,758(	(60,231)
Taxes received	5,132	2,101	4,796
	(64,173)	)64,881(	)62,060(
Net cash provided by operating activities	422,866	355,510	245,066

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

	Year ended December 31,
	2024 2023		2022
	NIS in thousands
Cash flows from investing activities:
Purchase of property, plant and equipment	(55,643)	)55,858(	)14,047(
Acquisition of initially consolidated company (a)	(137,087)	)2,409(	)369,179(
Purchase of intangible assets	(742)	)1,983(	)3,014(
Acquisition of company accounted for at equity	-	)5,492(	-
Proceeds from sale of property, plant and equipment	987	1,239	501
Repayment of investment in lease	1,743	3,085	2,158
Long-term loans	-	)1,845(	)2,496(
Proceeds from sale of financial assets measured at fair
value through profit or loss	9,664	-	-
Acquisition of financial assets measured at fair value
through profit or loss	(2,329)	)1,111(	)478(
Receipt of loan for companies accounted for at equity and
others	1,018	277	1,500
Net cash used in investing activities	(182,389)	)64,097(	)385,055(
Cash flows from financing activities:
Dividend paid to equity holders of the Company	(68,796)	)57,330(	)22,912(
Dividend paid to non-controlling interests	(303)	-	-
Exercise of restricted shares	15	-	20
Issue of share capital (net issue expenses)	-	-	68,482
Receipt of loans from banks	-	-	100,000
Repayment of short-term credit from banks, net	2,330	)18,306(	)1,694(
Acquisition of shares from non-controlling interests	(44,378)	-	-
Repayment of lease liabilities	(56,459)	)63,864(	)52,151(
Repayment of other liabilities	(6,278)	)4,900(	)12,202(
Repayment of loans from banks	(24,375)	)33,125(	)57,679(
Net cash provided by (used in) financing activities	(198,244)	)177,525(	21,864
Exchange rate differences from foreign currency on
balances of cash and cash equivalents	139	)231(	6,742
Increase (decrease) in cash and cash equivalents	42,372	113,657	)111,383(
Cash and cash equivalents at the beginning of the year	300,633	186,976	298,359
Cash and cash equivalents at the end of the year	343,005	300,633	186,976

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

		Year ended December 31,
		2024	2023	2022
		NIS in thousands
(a)	Acquisition of initially consolidated company:
	Working capital, net	12,791	91	2,616
	Property, plant and equipment	(970)	)1(	)9,950(
	Right-of-use assets	(966)	-	)22,972(
	Intangible assets	(84,478)	)2,810(	)164,263(
	Goodwill	(110,753)	)4,748(	)211,941(
	Other non-current assets	-	-	)5,829(
	Deferred taxes	5,415	647	10,514
	Other non-current liabilities	29,499	-	4,541
	Liability for contingent consideration	11,409	4,299	2,800
	Lease liabilities	966	-	28,426
	Non-controlling interests	-	113	-
	Fund sorting of hedging transactions for consideration
	of the acquisition	-	-	(2,524)
	Exchange rate differences due to deferred
	consideration	-	-	)597(
		(137,087)	)2,409(	)369,179(
(b)	Significant non-cash transactions:
	Purchase of property, plant and equipment and
	intangible assets on credit	2,611	5,896	1,652
	Acquisition of a company and activity against
	contingent consideration	11,409	4,299	2,800
	Right-of-use asset recognized with corresponding
	lease liability, net	56,092	143,212	79,584
	Recognition of lease receivable asset	23,969	-	-
	Proceeds from sale of financial assets measured at fair
	value through profit or loss	1,365	-	-

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