Intercure Ltd 6-K, filed Nov 16, 2022

Intercure Ltd. (INCR)

6-K 2022-11-16 For: 2022-11-16

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Added on April 06, 2026

About this 6-K

Intercure Ltd filed this 6-K on November 16, 2022.

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Exhibit No.		Description

99.1		Unaudited Interim Consolidated Financial Statements for the Period Ended September 30, 2022
99.2		Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Period Ended September 30, 2022
99.3		Form 52-109F2 – Certifications of Interim Filings
99.4		Press Release dated November 15, 2022: InterCure Announces Record Breaking Third Quarter Financial Results

	Intercure Ltd.

Date: November 16, 2022	By:	/s/ Amos Cohen
		Amos Cohen
		Chief Financial Officer

	Page

Condensed Consolidated Interim Statements of Financial Position	3-4

Condensed Consolidated Interim Statements of Profit or Loss and Other Comprehensive Income	5

Condensed Consolidated Interim Statements of Changes in Equity	6

Condensed Consolidated Interim Statements of Cash Flows	7-8

Notes to Condensed Consolidated Interim Financial Statements	9-18

		September 30		December 31
		2022		2021
	Note	NIS in thousands
Current assets
Cash and cash equivalents			215,255		196,217
Restricted cash			24,271		21,083
Trade receivables			40,227		17,407
Other receivables			74,689		33,244
Inventory	5		126,156		62,313
Biological assets	6		9,139		5,566
Financial assets measured at fair value through profit or loss	7		200		330

			489,937		336,160

Non-current assets
Property, plant and equipment and right-of-use asset			94,703		86,509
Goodwill			285,209		*268,291
Deferred tax assets			2,407		3,020
Financial assets measured at fair value through profit or loss			2,565		2,565
			384,884		360,385

Total assets			874,821		696,545

	September 30			December 31
	2022			2021

Current liabilities
Short term loan and current maturities		134,998			70,559
Trade payables		97,796			64,474
Other payables		37,673			41,050
Contingent consideration		23,648			15,780
Short term loan from non-controlling interest		1,232			1,722

		295,347			193,585

Non-current liabilities
Borrowings		45,591			11,877
Liabilities in respect of employee benefits		1,005			224
Loan from related party		-			76
Lease liability		19,415			21,371
		66,011			33,548

Total liabilities		361,358			227,133

Equity
Share capital, premium and other reserves		629,290			623,567
Capital reserve for transactions with controlling shareholder		2,388			2,388
Receipts on account of shares		8,541			8,541
Accumulated losses		(150,200	)		(186,468	)

Equity attributable to owners of the Company		490,019			448,028

Non-controlling interests		23,444			*21,384

Total equity		513,463			469,412

Total equity and liabilities		874,821			696,545

	Nine months ended September 30,						Three months ended September 30,						Year ended December 31
	2022			2021			2022			2021			2021
	NIS in thousands

Revenue		283,078			139,976			100,572			61,695			219,677
Cost of revenue before fair value adjustments		161,605			80,600			56,498			37,013			123,688

Gross income before impact of changes in fair value		121,473			59,376			44,074			24,682			95,989

Unrealized changes to fair value adjustments of biological assets		4,567			3,761			(3,314	)		1,316			6,574
Loss (profit) from fair value changes realized in the current year		(3,183	)		6,372			(5,453	)		3,942			11,432

Gross Profit		129,223			56,765			46,213			22,056			91,131

Research and development expenses		458			1,015			120			298			1,235
General and administrative expenses		27,206			15,598			10,248			7,825			27,206
Selling and marketing expenses		40,886			14,668			16,774			6,245			23,214
Other expenses (income), net		227			1,401			(897	)		1,692			2,971
Changes in the fair value of financial assets through loss or (profit), net.		177			(333	)		54			(8	)		1,868
Share based payments		6,172			5,281			3,731			1,463			6,452

Operating Profit		54,097			19,135			16,183			4,541			28,185


Financing expenses		10,496			2,956			4,397			2,464			9,581
Financing income		8,966			-			161			-			130

Profit before tax on income		52,567			16,179			11,947			2,077			18,734

Tax on income		(14,084	)		(5,846	)		(3,639	)		(1,537	)		(11,441	)
Total comprehensive Profit		38,483			10,333			8,308			540			7,293

Attribution of net profit for the quarterly:
To the Company’s shareholders		36,268			7,761			7,256			(1,644	)		4,690
To non-controlling interests		2,215			2,572			1,052			2,184			2,603
Total		38,483			10,333			8,308			540			7,293

Profit per share
Basic Profit		0.80			0.18			0.16			(0.04	)		0.12
Diluted Profit		0.80			0.16			0.16			(0.03	)		0.11

	Share capital, premium and other reserves			Capital reserve for transactions with controlling shareholder		Receipts on account of shares			Accumulated losses			Equity attributable to owners of the Company			Non-controlling interests			Total equity
	NIS in thousands

As of January 1, 2022		623,567			2,388		8,541			(186,468	)		448,028			21,384			469,412

Profit for the period		-			-		-			36,268			36,268			2,215			38,483
Acquisitions of subsidiaries		-			-		-			-			-			(155	)		(155	)
Settlement in cash of an obligation to issue shares		(449	)		-		-			-			(449	)		-			(449	)
Share-based payment		6,172			-		-			-			6,172			-			6,172

As of September 30, 2022		629,290			2,388		8,541			(150,200	)		490,019			23,444			513,463

As of January 1, 2021		452,259			2,388		11,017			(191,158	)		274,506			17,603			292,109

Profit for the period		-			-		-			7,761			7,761			2,572			10,333
Exercise of share options		8,359					(1,963	)		-			6,396			-			6,396
Share-based payment		5,282			-		-			-			5,282			-			5,282
Issuance of shares, net		135,997			-		-			-			135,997			-			135,997

As of September 30, 2021		601,897			2,388		9,054			(183,397	)		429,942			20,175			450,117

	Nine months ended September 30,
	2022			2021
	NIS in thousands
Cash flows from operating activities

Profit for the period		38,483			10,333
Taxes on income paid		(6,397	)		(1,853	)
Adjustments required to present cash flows from operating activities (A)		(23,978	)		13,720

Net cash provided by (used in) operating activities		8,108			22,200

Cash flows from investing activities

Purchase of property, plant and equipment		(15,059	)		(6,555	)
Grant of loan		(44,732	)		(4,972	)
Acquisition of Subsidiary and activities, net of cash acquired		797			(28,288	)
Settlement in cash of an obligation to issue shares		(449	)		-
Investment in assets measured at fair value through profit or loss		-			(281	)
Decrease in deposit		-			11
Increase in deposit		(1,651	)		(11	)
Payment for contingent consideration		(6,168	)		-
Payment for deferred consideration for the acquisitions of subsidiaries		(12,716	)		-
Net cash used in investing activities		(79,978	)		(40,096	)

Cash flows from financing activities

Exercise of share options		-			6,396
Lease payments		(957	)		(582	)
Receipt of loans from banks		175,138			63,200
Repayment of loans from banks		(77,955	)		(100	)
Receipt of loan to related party and controlling shareholder		158			-
Repayment of loan from related party and controlling shareholder		(711	)		(4,534	)
Proceeds from issuance of shares as part of private issuance, net of issuance costs		-			128,221
Interest paid		*(12,357	)		*(2,894	)
Net cash provided by financing activities		83,316			189,707

Increase in cash and cash equivalents		11,446			171,811
Exchange differences in respect of balances of cash and cash equivalents		8,204			(720	)
Balance of cash and cash equivalents at beginning of year		195,272			37,888

Balance of cash and cash equivalents at end of year		214,922			208,979

Company	-	Intercure Ltd.
Group	-	The Company and its subsidiaries.
Related Parties	-	As defined in IAS 24.
USD	-	U.S. dollars.
NIS	-	New Israeli shekel.
Subsidiaries	-	Companies which are controlled by the Company (as defined in IFRS 10), directly or indirectly, and whose financial statements are fully consolidated with the Company’s reports.

	Nine months ended September 30, 2021
							As presented in
	As presented			Effect of			these financial
	in the past			correction			statements
	NIS thousands			NIS thousands			NIS thousands
Profit for the period		10,333						10,333
Interest paid		(2,894	)		2,894
Taxes on income paid		(1,853	)					(1,853	)
Adjustments required to present cash flows from operating activities (A)		13,720						13,720

Net cash provided by (used in) operating activities		19,306			2,894			22,200

Net cash provided by financing activities		192,601			(2,894	)		189,707

	NIS in thousands
Consideration paid in cash		1,000
Deferred consideration in cash		3,322
Contingent consideration		12,780
Non-controlling interests		(155	)
		16,947

	NIS in thousands
Cash and cash equivalents		1,797
Trade and other receivables		2,115
Inventory		2,032
Property, plant and equipment and right-of-use asset		275
Goodwill		150
Current maturities		(75	)
Trade and other payable		(4,463	)
Loan from non-controlling interest		(92	)
Liabilities in respect of employee benefits		(383	)
Borrowings		(1,169	)
Total identifiable net assets		187

	September 30,		December 31,
	2022		2021
	NIS in thousands
Finished goods		81,502		39,256
Goods in process and dried inflorescence		44,654		23,057
Total inventory		126,156		62,313

	(1)	According to the number of seedlings as of the end of the reporting period
	(2)	According to the price range of the Company’s existing products as of the end of the reporting period
	(3)	The Company’s estimate regarding the future ratio of sales
	(4)	In accordance with the Company’s experience, and according to the strains which exist as of the reporting date
	(5)	By planting date vs. growing cycle length

	NIS in thousands
	Cannabis segment		Biomed segment			Reconciliations			Total

Nine months ended September 30, 2022
External revenue		283,078		-			-			283,078
Segment profit (loss)		65,999		(173	)		-			65,826

General and administrative expenses not attributable to segments										(11,502	)
Other expenses, net										(227	)
Operating profit										54,097

Segment assets		745,221		2,766			126,834			875,821
Segment liabilities		394,575		-			(33,217	)		361,358

Nine months ended September 30, 2021
External revenue		139,976		-			-			139,976
Segment profit (loss)		29,010		333			-			29,343

General and administrative expenses not attributable to segments										(8,807	)
Other expenses, net										(1,401	)
Operating Profit										19,135

Segment assets		513,202		4,132			138,269			655,602
Segment liabilities		231,838		-			(26,352	)		205,486

Three months ended September 30, 2022
External revenue		100,572		-			-			100,572
Segment profit (loss)		21,606		(50	)		-			21,556

General and administrative expenses not attributable to segments										(6,270	)
Other expenses, net										897
Operating profit										16,183

Segment assets		67,970		(49	)		14,836			81,757
Segment liabilities		40,344		-			30,040			70,384

	A.	In October 2022, the Company purchase 51% of “Amirim Pharm” pharmacy located in Hadera for an immaterial consideration.

	B.	In October 2022, Fore has initiated an investment round. If the Company chooses not to participate it will be diluted from 0.44% to 0.10% on a fully diluted basis.

Date: November 15, 2022

/s/ Alexander Rabinovitch
Alexander Rabinovitch
Chief Executive Officer

Third quarter	Q3 2022		Q3 2021
Revenues		100,572		61,695
Gross Profit ⁽¹⁾		44,074		24,682
Adjusted EBITDA ⁽²⁾		22,188		14,040

	Q3-22			Q2-22			Q1-22			Q4-21			Q3-21			Q2-21			Q1-21
Revenues		100,572			95,277			87,229			79,701			61,695			45,230			33,051
Gross Profit ⁽¹⁾		44,074			41,542			35,857			36,613			24,682			19,267			15,427
GP Margin		44	%		43	%		41	%		46	%		40	%		42	%		46	%
Adjusted EBITDA⁽²⁾		19,652			20,709			19,911			19,446			11,999			10,814			9,468
Adjusted EBITDA Margin		20	%		21	%		22	%		24	%		19	%		24	%		28	%

	For the 3-month ended on September 30
	2022			2021
Revenues		100,572			61,695
Gross profit before effect of fair value		44,074			24,682
Gross profit after effect of fair value		46,213			22,056
Research and development expenses		(120	)		(298	)
General and administrative expenses		(13,979	)		(9,288	)
Marketing and selling expenses		(16,774	)		(6,245	)
Impairment gains and (losses) on financial assets through profit or loss		(54	)		8
Other income (expenses), net		897			(1,692	)
Consolidated operating profit		16,183			4,541
Comprehensive income		8,308			540
Interest / Financing expenses (income) net		4,236			2,464
Tax expenses		3,639			1,537
Depreciation and amortization		2,719			1,684
EBITDA		18,903			6,225
Share-based payment expenses		3,731			1,464
Other expenses (income), net		(897	)		1,692
Impairment losses and (gains) on financial assets through profit and loss		54			(8	)
Fair value adjustment to inventory		(2,139	)		2,626
Adjusted EBITDA		19,652			11,999
Basic earnings (loss) per share		0.16			(0.04	)
Diluted earnings per share		0.16			(0.03	)

	●	MJBizCon – Marijuana Business Conference & Cannabis Expo
	●	InterCure’s management will be hosting investor meetings.