Formula Systems Q1 Revenues Jump 19.2% to $738.3M, Declares $13.045 Dividend
Formula Systems posted first-quarter revenues up 19.2% year-over-year to a record $738.3 million and net income surged 84.5% to $35.6 million, driven by a $16.8 million capital gain from TSG’s private placement. The board approved a special $13.045 per-share dividend totaling ~$200 million payable June 4.
1. Record Financial Performance
Formula Systems achieved record first-quarter revenues of $738.3 million, a 19.2% increase over Q1 2025, and operating income rose 65.6% to $82.0 million, including a $16.8 million capital gain. Net income attributable to shareholders climbed 84.5% to $35.6 million ($2.25 per diluted share), while excluding the capital gain net income still rose 60.5% to $18.9 million.
2. Affiliate Transactions and Capital Gain
On February 24, Matrix IT Ltd. completed a reverse triangular merger with Magic Software, issuing 28.9 million Matrix shares and delisting Magic Software. In January, TSG IT Advanced Systems raised NIS 192 million ($58.9 million) via private placement and issued 128,150 warrants, diluting Formula’s TSG stake from 37.33% to 33.08% and generating a $16.8 million capital gain.
3. Special Dividend and Balance Sheet Strength
The board approved a $13.045 per-share special cash dividend (~$200 million) to be paid June 4 to shareholders of record May 25. As of March 31, cash and equivalents totaled $1.18 billion and total equity reached $1.82 billion (50.1% of assets), with all debenture covenants comfortably met.
