Reshef: How Much Of The 2025 Cash Balance Really Came From The Business
Reshef ended 2025 with NIS 492.9 million of cash, but only part of that jump was built by the operating business. The cash bridge shows that the balance also relied on a NIS 292.9 million shares-and-options issue and a NIS 76.2 million controlling-shareholder debt line.
What This Follow-Up Is Isolating
The main article argued that the exceptional 2025 earnings print still did not settle the quality-of-cash question. This follow-up narrows the issue further: out of the NIS 492.9 million cash balance at year end, how much really came from the business itself, and how much came from capital actions and from a line that sits outside the operating engine.
The short answer: operating activity generated a lot of cash, NIS 206.9 million, but that was not most of the year-end build. Cash increased by NIS 474.8 million during 2025, and only 43.6% of that increase came from operating cash flow. The rest came mainly from the NIS 292.9 million shares-and-options issue and from NIS 76.2 million of net repayment in the controlling-shareholder debt line.
The right framing here is an all-in cash flexibility bridge, not a normalized earning-power bridge. The question is not how much cash the business might produce in a steady year, but how much cash was actually left after reported CAPEX, the dividend, loan repayment, and lease payments. On that basis, the year-end balance is real, but it was not built by the operating business alone.
The Cash Bridge Behind The Headline Balance
The right way to read the NIS 492.9 million headline is to break the bridge from the opening cash balance, NIS 18.1 million, to the closing figure. Once that is done, the picture becomes clear: the company benefited from three different engines, not one.
| Cash bridge item | NIS m | Share of cash increase | What it means |
|---|---|---|---|
| Operating cash flow | 206.9 | 43.6% | Real business cash generation, but not the only source |
| Net repayment of controlling-shareholder debt | 76.2 | 16.1% | Cash inflow outside the core operating engine |
| Shares and options issue | 292.9 | 61.7% | A large equity source that lifted the balance in one move |
| Dividend, loan and lease payments | (101.0) | (21.3%) | Actual cash uses already deducted from the balance |
| CAPEX and other investing, net | (0.2) | 0.0% | Almost neutral to the overall picture |
None of this means the business failed to produce cash. That would be the wrong read. A company that generated NIS 206.9 million of operating cash in one year did create real cash. But the NIS 492.9 million headline balance also includes a major capital action and a collection through the controlling-shareholder debt line. Anyone who attributes the entire balance to operating performance is giving the business credit for cash that did not originate in the operating cash flow line.
The largest item in the bridge is the shares-and-options issue, NIS 292.9 million. It was bigger than operating cash flow itself, which completely changes the year-end reading. The second non-core boost, NIS 76.2 million, came through the net repayment of controlling-shareholder debt. That cash did enter the balance, but it should not be read as recurring operating generation.
Why NIS 308.7 Million Of Net Income Became NIS 206.9 Million Of Operating Cash
If the question is how much of the balance really came from the business, the right stopping point is operating cash flow, not the ending cash line. This is where the gap between strong accounting profit and actual cash collection shows up.
The gap is material. Reshef finished the year with NIS 308.7 million of net income, but NIS 126.5 million was absorbed by working capital and another NIS 7.5 million went out through interest and taxes, leaving operating cash flow at NIS 206.9 million. The NIS 32.2 million of non-cash adjustments softened only part of that gap.
The main yellow flag sits in two lines. Trade receivables rose by NIS 95.1 million, while customer advances fell by NIS 36.1 million. Those two numbers tell almost the same story from different angles: more of 2025 activity ended the year as receivables on the balance sheet, and less of it was financed in advance by customers.
That does not make 2025 weak. On the contrary, operating cash flow above NIS 200 million proves that the business itself worked. But it does mean profit-to-cash conversion was materially weaker than the headline earnings figure suggests. Anyone looking only at the bottom line misses the fact that the company carried much more working capital precisely in the year when reported results exploded higher.
What Is Left After Stripping Out The Capital Moves
This is the key point. Strip out only the shares-and-options issue, NIS 292.9 million, and the year-end cash balance no longer looks like half a billion shekels. It looks like roughly NIS 200.0 million. Strip out the NIS 76.2 million net repayment in the controlling-shareholder debt line as well, and the arithmetic balance falls to about NIS 123.8 million.
That calculation is severe, but it also reveals something constructive. This is not fake cash. Even after removing those two non-operating sources, and even after a NIS 100 million dividend plus loan and lease payments, Reshef would still have ended the year with far more cash than it had at the start. In other words, 2025 operations did build a real cash cushion. They just did not build the entire cushion shown in the headline number on their own.
That is also the difference between accessible balance-sheet cash and a headline cash figure that overstates repeatability. In capital-structure terms, NIS 492.9 million is a fact. In repeatability terms, the number that matters going forward is the NIS 206.9 million of operating cash flow, and especially whether 2026 can sustain that level without another equity raise and without the same mix of higher receivables and lower customer advances.
What Sets Up The 2026 Read
The next discussion on Reshef should not start with whether 2025 was strong. That is already clear. It should start with whether the 2025 cash structure was a one-off snapshot or a repeatable base.
If receivables stop growing faster than revenue, if customer advances stabilize or recover, and if operating cash flow stays strong without another capital action, the read on the cash balance can improve quickly. If profit stays high but cash keeps getting stuck in receivables, then the NIS 492.9 million closing balance will look more like a peak balance-sheet moment than a new operating baseline.
That is the point of this continuation. Reshef's business produced a lot of cash in 2025, but the year-end cash balance represented more than the business alone. Reading 2026 correctly requires separating those two things.
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