Bet Shemesh Engines Ltd. (TASE: BSEN), controlled by FIMI Opportunity Funds, last Thursday reported to the TASE that it had signed an agreement for 2017-2030 with German company MTU. Under the agreement, which is an update of an existing framework agreement dating back to 2013, the company will manufacture parts that it previously supplied to the German company, "including discs for various jet engines."
Bet Shemesh Engines' revenue from the deal will amount to $173 million for the entire period, with some of the parts being supplied starting in 2019. Together with the new agreement, the company is downwardly revising its revenue forecast from the old agreement with MTU, scheduled to expire in 2018, from $63 million to $55 million. As of December 31, 2016, the company has recognized $38 million in revenue from this agreement.
At the beginning of last week, Bet Shemesh Engines reported $86.2 million in revenue for 2016, 11.5% more than in the preceding year. The company's gross profit totaled $16.7 million, 19.5% of revenue, 29% more than in 2015. Operating profit was up 49% to $11 million, and the company made a $9 million net profit in 2016, 15% more than in 2015.
Bet Shemesh Engines CEO Avner Shaham, who previously controlled the company together with FIMI, sold most of his shares in late 2016 to investment institutions for NIS 65 million, leaving him with a 9.2% stake. After 25 years as CEO, Shaham announced in January that he would resign in April. His replacement will be Ram Drori, who has been CEO of Arkal Automotive since 2019.
Published by Globes [online], Israel Business News - www.globes-online.com - on March 26, 2017
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