Tigbur Group 2025: Growth Continued, but the National Insurance Tender Still Defines the Story

Getting To Know The Company

At first glance, Tigbur looks like a broad operating-services group: staffing, nursing, security, accessibility, outsourcing, some activity around foreign workers, and a small investment-property layer. That read is not wrong, but it is still not the right one. In practice, the economics of the company still sit mainly on one engine, staffing and nursing, which generated NIS 1.01 billion of external revenue in 2025, about 67% of the group total, and NIS 41.4 million of operating profit, more than 70% of segment profit. So the active bottleneck is not “how to grow into one more adjacent service.” It is how to get through the next National Insurance Institute tender without damaging tariffs, revenue structure, and margin.

There is real substance in the year. Revenue rose 13.3% to NIS 1.507 billion, net profit rose to NIS 40.2 million, EBITDA rose to NIS 79.6 million, and the company ended the year with NIS 205.7 million of equity, wide bank lines, and very comfortable covenant headroom. Security also kept growing, doubtful-debt provision fell from NIS 9.5 million to NIS 4.8 million, and short interest in the stock is almost nonexistent.

But this is still not a clean picture. Operating leverage remains very modest. Normalized operating profit, before fair-value gains on investment property and goodwill impairments, rose only to NIS 56.8 million, so normalized operating margin barely moved, from 3.74% to 3.77%. In other words, activity scale grew, but business quality did not structurally change. At the same time, accessible cash remains tighter than the EBITDA line suggests: cash on hand is only NIS 14.3 million, and even after adding NIS 62.0 million of financial assets, the company still spent NIS 19.0 million on dividends, NIS 17.6 million on lease principal, and increased short-term bank credit by NIS 16.5 million during the year.

There is also an important practical screen layer here. At recent prices, market cap stands around NIS 665 million, but the latest daily trading turnover was only about NIS 64 thousand. So the main market constraint in this name is liquidity, not aggressive bearish positioning. Short interest stands at just 0.01% of float, versus a sector average of 0.16%. The market is not expressing a strong negative view through short positioning. If there is friction here, it sits in customer concentration, the nursing tender, and the company’s ability to turn volume into cleaner margin.

The Economic Map

These two charts put the company in the right frame. The first one shows that Tigbur is no longer a narrow staffing company, but even in 2025 the center of gravity remained unchanged. The second one shows what the revenue headline hides: the company has grown quickly over five years, but normalized operating margin still hovers around the 4% zone and has not structurally stepped up. This is a business that knows how to grow, but still struggles to turn scale into a materially wider margin.

Events And Triggers

The National Insurance Institute tender is still the key test

This is the core issue. The National Insurance Institute already accounted for NIS 630 million of revenue in 2025, up from NIS 560 million in 2024, and the company explicitly defines it as a major customer on which it depends. In October 2025, the Institute announced that the current engagement would be extended through the end of 2026, with a one-year option, or until the new tender process is completed, whichever comes first. On one hand, that gave continuity. On the other, it did not solve the issue. It only deferred the decision point.

Since then the thread became even more important. The October 2025 court ruling sent parts of the tender back for renewed review. Industry participants appealed. In February 2026, the Institute published another clarification file, and in March 2026 another petition was filed. As of the report date, the final submission deadline was set for April 29, 2026. The company says it meets the threshold conditions and the quality metrics that are within its control, but also argues that some of the criteria are unreasonable, outside its control, and that the new tender includes tariff and tariff-structure changes. That is not a side note. It is the most important 2026 disclosure in the report.

Management also says that if the company remains on the winners list, the impact is not expected to be material to revenue. That is a calming statement, but it needs to be read carefully. It assumes inclusion in the winners list, and it speaks about revenue, not necessarily about profit. In a business with a 3.77% normalized operating margin, even a small change in tariff structure can be felt much more clearly in the profit line than in the revenue line.

This chart explains why the tender matters more than the rest of the headline set. Tigbur is not literally a one-customer company, but the economics of the core engine do sit on one very large customer plus a fairly limited surrounding layer of other major accounts. Anyone who buys the diversification story without first going through this pie chart is missing the true center of gravity.

There is new contract flow, but it still does not replace the core engine

On the positive side, 2025 and early 2026 do bring meaningful contract flow. In staffing and nursing, the company won a Defense Ministry tender in December 2024 to provide medical escort services to the rehabilitation division. The planned agreement would run for 60 months with an option for another five years. The company estimates annual consideration of about NIS 100 million and around NIS 1 billion in total if the option is fully exercised. That is a significant trigger, but as of the report date the company was still working toward signing a new agreement, so it should not yet be treated as locked-in revenue.

In security, Reshef had already won the Israel Police tender in late 2024 to provide security services around the Jerusalem envelope. The agreement signed in December 2024 runs for 24 months with a three-year option, at expected annual consideration of around NIS 36 million and about NIS 180 million in total if the option period is fully used. In addition, in December 2025 the company received notice that it had won a Ministry of Economy tender to operate support services for small and medium-sized businesses, and in February 2026 it established a 50-50 venture with a third party to support the entry of foreign workers into industry, trade, and services.

All of these items matter. They improve the growth pipeline and the adjacencies story, especially in security and complementary services. They still do not change the basic fact that staffing and nursing remains the engine that carries the company, and they do not yet change the fact that group profitability remains thin.

The fourth quarter improved, but it did not look like a breakout

At the headline level, the year-end exit was respectable. Fourth-quarter revenue rose 10.9% to NIS 372.7 million, profit from ordinary operations rose to NIS 12.4 million, and net profit for the quarter rose to NIS 8.2 million. That is a sharp improvement versus the comparable quarter, which had also been affected by a larger goodwill impairment.

But the internal sequence matters too. Versus the third quarter, revenue fell from NIS 391.4 million to NIS 372.7 million, and normalized operating profit fell from NIS 14.9 million to NIS 11.2 million. There is some seasonality here, especially around examination-supervision activity, and not every quarter is meant to look like the previous one. Still, anyone looking for a year-end proof of a structurally higher margin did not get one.

The quarterly chart sharpens the point. There is a clear year-on-year improvement versus late 2024, but there is still no proof that the company has moved into a new profitability regime. That matters because in 2026 the market is likely to focus mainly on the direction of the core margin, not on volume growth alone.

Efficiency, Profitability And Competition

Growth is there, but the economic change is still smaller than the headline suggests

Revenue rose 13.3% to NIS 1.507 billion. Gross profit rose 10.8% to NIS 109.8 million. General and administrative expenses rose 9.2% to NIS 50.8 million. At the broader operating line, profit from ordinary operations rose 25.5% to NIS 58.0 million. On the surface, that looks like a solid improvement year.

What is more interesting is the gap between reported profit and repeatable profit. Part of the improvement came from a NIS 1.9 million fair-value gain on investment property, versus NIS 0.5 million in the prior year. Part of the comparison is also easier because goodwill and intangible-asset impairment dropped from NIS 4.1 million to NIS 0.7 million. Once those two items are stripped out, operating profit rises from NIS 49.8 million to NIS 56.8 million, and normalized operating margin barely moves, from 3.74% to 3.77%.

That is the heart of the story. Tigbur is growing, but it still has not built a deep operating-leverage layer. This is not a business that stepped up into a meaningfully more comfortable profitability zone. It is a business that keeps adding volume, with some improvement, but without a structural jump in quality.

The profit engines are much less diversified than the presentation suggests

Staffing and nursing is still the real center of the model. Revenue in that segment rose 13.3% to NIS 1.010 billion, and operating profit rose 11.9% to NIS 41.4 million. Management explains that the improvement was held back by preparation costs for the new nursing tender. That is a good nuance. The expense is already here. The benefit is not yet proven.

Security rose 14.6% to NIS 427.1 million of revenue, and operating profit there rose 16.6% to NIS 11.9 million. That is a strong result, especially because the company says profitability was still being hurt by the number of employees serving in reserve duty and the knock-on effects from that. In other words, security currently looks like the second real growth engine of the group, with a more supportive demand backdrop, even if it is not yet a high-margin engine.

Accessibility still does not carry its weight at the profit level. Revenue rose to NIS 24.7 million, but the segment still posted a NIS 0.6 million operating loss in 2025. True, this is no longer the NIS 4.1 million impairment-heavy picture of 2024, and the loss is much smaller. Still, after the acquired-activity layer and the technology and patent framing, this is far from being a meaningful profit engine.

In investment property, the economic read is easy to misread. On one hand, rental revenue is only NIS 3.0 million, and representative NOI stands at NIS 2.84 million. On the other hand, segment operating profit reaches NIS 4.8 million because of fair-value gains. Anyone reading that improvement as fully operational improvement is making a mistake. Part of the value is real, but a large part of it is still accounting value or upside that depends on further maturation of the assets.

This chart matters because it shows two things at once. First, the improvement comes almost entirely from two segments, staffing and nursing, and security. Second, even after that improvement, the profit structure is still narrow. This is not a company with three or four equally meaningful earnings engines. It has one main engine, one secondary engine, and several smaller layers that add spot value.

The barriers are real, but pricing power is still limited

Tigbur does have real competitive advantages. It operates through 42 branches and outposts nationwide, employs 21,544 workers across various employment scopes, holds licenses and permits across its core areas, works with major public and institutional bodies, and manages large labor-intensive operations under meaningful regulation. This is not a model that every small competitor can replicate quickly.

But that still needs to be stated honestly: an operating advantage is not the same as pricing power. The company itself says the staffing and nursing market includes around 1,000 companies, while security includes around 400. In security, entry barriers are lower, so aggressive pricing by smaller players continues to pressure the industry. In nursing, tariffs are shaped much more by tender structures and regulation than by the company’s ability to ask for meaningfully better prices. So Tigbur looks like a good operating platform, but not like a business with unusual pricing power.

Cash Flow, Debt And Capital Structure

The right framework here is all-in cash flexibility

That is the correct lens for Tigbur. I am not using a “normalized cash generation” frame before capital uses, because the 2025 story is about actual financing flexibility, not a theoretical pre-use earnings-power number. The relevant question is how much cash really remained after the year’s real uses.

Cash flow from operating activities came in at NIS 44.1 million. That is positive, and it is better than NIS 31.0 million in 2024. But once the view shifts to the full cash picture, the story becomes less comfortable. Investing activity consumed NIS 22.5 million, including NIS 11.9 million invested in short-term deposits and NIS 6.8 million of fixed-asset purchases. Financing activity consumed NIS 20.2 million, mainly because of NIS 19.0 million of dividends and NIS 17.6 million of lease-principal payments, offset partly by NIS 16.5 million of net short-term bank credit.

In plain English, Tigbur did not end 2025 as a business that comfortably funded all its cash uses out of operations alone. It ended as a business that can produce operating cash, but still leans on credit facilities and a financial-asset cushion to preserve flexibility.

This is not a distress chart. It is a boundary chart. It says the company’s cash margin remained positive, but narrow. So when investors see EBITDA of NIS 79.6 million, it is still wrong to jump straight to “strong cash generation.” In a model like this, only an all-in view shows how much room באמת remains after everything else.

Working capital is fine, but it still sits on a lot of customer credit

As of December 31, 2025, current assets stood at NIS 393.5 million against current liabilities of NIS 306.9 million, so working capital is positive and the current ratio stands at 1.28. That is a respectable base. But again, the detail matters.

Receivables rose to NIS 280.6 million from NIS 249.5 million, and management explains that the increase mainly reflects organic revenue growth. Average customer credit days stand at 67.9 days, versus only 54 days for suppliers. In other words, the operating model still extends a lot of credit to customers, which is normal for a business working with large public and institutional bodies. But that is also why the cash flow profile does not behave like an easy business.

There is another non-obvious finding here. The rise in current liabilities is not all about operating pressure. NIS 12.5 million of it is tied to a tax-reporting change at subsidiary Reshef Security, from cash basis to accrual basis, which moved a deferred-tax balance into current payables. This is a good example of something that can look like pure balance-sheet deterioration at first glance, while in practice it is mainly an accounting and tax reclassification.

The balance sheet remains flexible, and covenant room is wide

This is the clearest positive in the report. Short-term bank credit rose to NIS 92.1 million, but the company also holds NIS 14.3 million of cash and cash equivalents, NIS 62.8 million of cash and financial assets under its capital-management view, and only NIS 15.8 million of net financial debt. Total credit lines stand at NIS 230 million, of which only NIS 137 million were used, so the company is not sitting close to the wall.

The covenants are also very comfortable: NIS 205.7 million of equity versus a NIS 40 million minimum, an equity-to-assets ratio of 38.9% versus a 20% minimum, and a solo ratio of receivables to net financial debt that looks unusually strong because cash exceeds borrowings. This is not a stressed balance sheet. It is a balance sheet that says something else: the company can absorb friction, but it would still prefer not to spend that flexibility on margin erosion.

One more distinction matters here. The value created in the investment-property layer and in the financial-assets layer is real, but it is not the same as immediate distributable cash to common shareholders. NIS 77.2 million of investment property, NIS 62.0 million of fair-value financial assets, and NIS 205.7 million of equity are an important cushion. They still do not replace the need for a cleaner earnings engine in the core services business.

Outlook

Before getting into 2026, it is worth starting with four findings that are not obvious from the headline read:

• The company is growing, but it still has not replaced its main engine. All the talk about synergies, technology, and multiple service layers does not change the fact that staffing and nursing still drive the economics.
• Margin barely moved. Profit improved, but more because of volume growth and an easier impairment comparison than because of a structural improvement in profitability.
• The balance sheet is better than the first fear, but the all-in cash picture is less comfortable. This is still a business that needs capital discipline.
• The real-estate layer is upside, not a fix. The Hadera nursing home, Pinzker, and the David Hachmi land parcel add value, but they are not what will determine the read on the next reporting cycle.

That also leads to the right label for next year: 2026 looks like a proof year, not a breakout year. Management talks about continued growth, stronger branding, broader service offerings, acquisitions of complementary activities, and more technology layers. That strategic direction is reasonable. But what the market is actually likely to test is far more practical.

The first test is the tender, not the revenue line

If the company stays on the winners list in the new nursing tender under workable tariff terms, the read on 2026 can improve quickly. If the tender ends up hurting economics more than management expects, the whole growth story will need recalibration. This is a quality test much more than a volume test.

The second test is the quality of profit in security and in the new public contracts

Security currently looks like Tigbur’s second real growth engine, and that matters. But at this stage it is still not clear whether the new wins will create only more payroll and more volume, or also a more meaningful profit contribution. The same logic applies to the Defense Ministry medical-escort win. Even if the potential size is large, it still has to convert into a signed agreement, execution, and margin.

The third test is capital flexibility after all real uses

This is where the market will look less at EBITDA and more at whether customer-credit days, dividends, lease cash, investment uses, and short-term borrowing remain under control. If 2026 again shows positive operating cash flow but lands in the same all-in friction point, it will be hard to argue that underlying business quality improved materially.

There is also a real-estate layer here. The David Hachmi land parcel kept moving forward through 2025 and into early 2026, including progress toward excavation and shoring permits, and the Hadera nursing-home asset continues to generate CPI-linked rent of roughly NIS 2.5 million per year. These are important assets. They are just not what will determine the market’s read on the next report. At this stage they are still a value-support layer, not the main trigger for a change in perception.

Risks

Dependence on the National Insurance Institute and customer concentration still sits at the center

The biggest risk in Tigbur is not the balance sheet. It is concentration. Revenue of NIS 630 million from the National Insurance Institute and NIS 141 million from Customer B is already economically meaningful concentration. On top of that, 91.2% of staffing-and-nursing segment sales come from 9 major customers. That means that even if no single customer other than the Institute threatens the company alone, the surrounding concentration layer is still meaningful.

Labor, regulation, and reserve duty are permanent operating risks

This is a business that employs more than 21.5 thousand workers and is shaped by wages, regulation, and collective arrangements. The company says that a 1% change in minimum wage creates a one-time cost of about NIS 100 thousand, even if tariff-indexation mechanisms reduce the longer-term exposure. It also says that 320 workers were in reserve duty on December 31, 2025, and that around 500 were still serving near the report date. For now the effect is not materially hurting group profitability, but it remains a real operating friction, especially in security.

The legal proceedings did not create a major provision, but they do remind investors how sensitive the model is

The company faces former-employee claims totaling around NIS 800 thousand, against which only NIS 35 thousand was provided. Beyond that, there is also a class-action application and a collective-dispute proceeding around escort workers serving disabled IDF veterans. The company made no provision there because, according to its disclosures, the Defense Ministry fully indemnifies the relevant payments through a back-to-back mechanism. That may indeed protect the company, but the existence of these proceedings still highlights how sensitive the business is to labor-law and contract-structure issues.

The real-estate value is real, but it is not a substitute for core profitability

Fair value of investment property rose to NIS 77.2 million, and the David Hachmi land parcel recorded a NIS 1.446 million fair-value increase in 2025. That is a meaningful cushion. But anyone trying to read the company mainly through the real-estate layer risks missing that the segment’s recurring revenue contribution is still only NIS 3.0 million. This is value that may deepen over time, not a layer that already replaces the need for stronger core-service profitability.

Conclusions

Tigbur ends 2025 as a public operating-services company that is growing, profitable, and financially flexible enough. That is the good part. The less comfortable part is that the company still has not proved it can turn that growth into a materially wider margin, and concentration around the National Insurance Institute nursing tender is still too strong to disappear behind a diversification story.

Current thesis in one line: Tigbur is a solid services platform with a reasonably flexible balance sheet, but 2026 will be defined much more by the economics of the nursing tender and by all-in cash quality than by the simple ability to keep expanding revenue.

What changed versus the simpler historical read on Tigbur? The company really has built a broader platform, with investment property, accessibility, security, outsourcing, and a better contract pipeline. But 2025 also reminds investors that the central question has not changed enough: how much of this platform can actually generate clean operating profit beyond the staffing-and-nursing core.

The strongest counter-thesis is that the nursing-tender concern is overstated. Management says the revenue impact should not be material, net financial debt is low, credit lines are open, new security and adjacent-service wins can gradually dilute dependence on nursing, and the real-estate layer adds support. That is a fair counter-thesis. The problem is that it still leans on too many important “ifs.”

What could change the market read in the short to medium term? First, any meaningful update around the nursing tender. After that, the first 2026 reports will be read through core-margin direction, working capital, and cash flow, not just top-line growth. If security continues to grow without squeezing margin, and if the company can keep positive operating cash flow without leaning materially harder on short-term credit, the read can improve quickly.

Why this matters is simple. In a labor-intensive services company, business quality is tested exactly where many companies fail: not in the ability to grow revenue, but in the ability to hold margin and cash generation while wages, regulation, and large customers pull in different directions. Tigbur has already proved it has volume. Over the next 2 to 4 quarters it needs to prove that it also has a more durable economic structure.