John SchroyerIsraeli medical marijuana company InterCure Ltd. (NASDAQ: INCR) (TASE: INCR) posted a loss last year of 63.5 million New Israeli Shekels, or about $16.9 million, “mainly due to war damage” following the Hamas attack on Oct. 7 last year, the company reported on Wednesday.
The losses came despite revenues of 355.5 million shekels/$94.6 million, down 8% from 388.6 million shekels/$103.4 million in 2022.
But InterCure posted a 43.7 million shekel/$11.6 million profit for the 2022 calendar year, which puts the war impact into stark contrast for the company, given that its net loss last year was a 245% downward financial swing.
InterCure’s southern facility in Israel is being used by the Israeli Defense Forces and its medical corps, as well as other government agencies, which has resulted in “limited access” for the company itself, InterCure said in a press release.
Although the Israeli government is compensating InterCure for the use of its facility to the tune of “tens of millions” of shekels as “partial advanced payments from the Israeli authorities,” the company’s operations apparently continue to be affected by the ongoing military conflict.
Prior to Oct. 7, InterCure appeared to be on a solid trajectory, and posted a 43.7 million shekel/$11.6 million profit for the 2022 calendar year, according to the company’s financial filings, which it followed up with solid revenue growth for the first half of 2023.
The war derailed that momentum temporarily, but InterCure leadership expressed confidence that the company will be able to get back to business this year.
CEO Alexander Rabinovitch said in the release that even with the net loss, InterCure “showed solid performance” given the circumstances, with “our fifteenth straight quarter of profitability,” and said the company finished both its third and fourth quarters last year with profits from direct operations.
“As the global landscape for pharmaceutical cannabis evolves, we are encouraged by the latest FDA recommendations and the optimistic outlook regarding rescheduling of cannabis in the U.S.,” Rabinovitch said.
The company also posted a profit from operations of 26 million shekels/$6.9 million, before accounting for “reductions of goodwill and fixed assets” that comprised the company’s annual losses.
The company also said it’s projecting “sequential double digit quarterly growth during 2024,” and launched 40 new product sku’s last year. InterCure said it’s also poised to enter the German cannabis market “in the coming months,” and now has a chain of 24 pharmacies in Israel that sell medical cannabis. It also still holds partnerships with California-based Cookies and Israeli medical marijuana pharmacy chain Givol.
InterCure finished 2023 with 786.6 million shekels/$209.4 million in total assets, including 101.3 million shekels/$26.9 million in cash, against 329.5 million shekels/$87.7 million in total liabilities.
