Exhibit 99.1

InterCure Announces Record Revenues First Half of 2023 with over 14% growth YOY

Achieved record revenues of NIS 209 million ($75 million)¹ for the first half of 2023

Annualized revenue run rate of NIS 417 million ($149 million)

Adjusted EBITDA² of NIS 30 million ($11 million)

Generated NIS 35 million ($13 million) cash from operations in the second quarter

Strong balance sheet with over NIS 116 million ($42 million) cash

and financial assets³ of NIS 71 million ($25 million)

NEW YORK, and HERZLIYA, Israel – Aug 31, 2023 – InterCure Ltd. (NASDAQ: INCR) (TASE: INCR) (dba Canndoc)(“InterCure” or the “Company”) is pleased to announce its financial and operating results for the six months ended June 30, 2023. All amounts are expressed in New Israeli Shekels (NIS) or Canadian dollars ($), unless otherwise noted.

Second Quarter and First Half 2023 Key Financial Highlights

● Record revenue of NIS 209 million ($75 million) for first half of 2023 and NIS 102 ($36 million) for the second quarter of 2023, representing YOY growth of over 14% and 8% respectively.

● Seventh consecutive half year growth representing an Annualized revenue run rate of NIS 417 million ($149 million).

● Gross profit of NIS 68 million ($24 million), 33% of revenue, for first half of 2023 and NIS 33 million ($12 million), 32% of revenue for the second quarter.

● EBITDA² of NIS 30 million ($11 million) for first half of 2023, representing 14% of revenue and NIS 14 million ($5 million) for the second quarter.

● Generated positive NIS 35 million ($13 million) cash from operations in the second quarter and a negative NIS 17 million ($6 million) for the first half.

● Cash and restricted cash at period end of over NIS 116 million ($42 million) and financial assets³ of NIS 71 million ($25 million). As the interest rate environment is changing, we are constantly revising our financing structure. During the first half of 2023 we voluntarily repaid loans of NIS 86 million ($31 million).

Second Quarter and First Half 2023 Key Operating Highlights

● Sustained market share growth during first half of 2023 due to solid demand for Canndoc’s branded products with more than 20 new SKU’s successful launches during the period marking Intercure’s leading position in all categories.

● The cultivation operation successfully added 18 new highly demanded strains into its growth cycles. Including new high THC Humbolt cultivars. These are expected to launch during the third and fourth quarters.

¹ All amounts are expressed in New Israeli Shekels (NIS) or Canadian Dollar ($).

² Means EBITDA for the cannabis sector adjusted for changes in the fair value of inventory, share-based payment expense, impairment losses (and gains) on financial assets, non-controlling interest and other expenses (or income).

³ Financial assets are mainly debts and loans included in other receivables.

 

● Signing collaboration agreement (in the form of a license agreement) with legendary boxer, entrepreneur, and cannabis advocate Mike Tyson’s premium cannabis brand. Under the terms of the agreement, InterCure will be granted the right on exclusive basis to cultivate, manufacture, sell, market and distribute all approved products and brands of TYSON 2.0 In Israel, Germany, France Australia and the United Kingdom. InterCure will also have the right to use the name, the marks and the TYSON 2.0 intellectual property in the said territories.

● Announced a voluntary delisting of our ordinary shares from the Toronto Stock Exchange, due to the fact that maintaining the listing did not offer substantial benefits to InterCure and its shareholders. InterCure’s shares continue to be trade on Nasdaq and the Tel Aviv Stock Exchange.

● on August 7, 2023 the minister of health announced a new reform of the Israeli medical cannabis regulations. The new regulations are set to revolutionize the process of prescribing medical cannabis to patients by allowing physicians to prescribe medical cannabis as the first line of treatment (for the first time). In addition, the new regulations will eliminate bottlenecks that have been burdened the industry during the last years. This includes easing cultivation, manufacturing and exportation procedures and regulations. Additionally matching the GMP standards between Israel and Europe and transition to self-regulation similar to the Israeli pharmaceutical industry. The new reform also set a process for the introduction of new formats like vapes, edibles, extracts and other non-flower formats. Furthermore, the reform set a date of February 2024 to reschedule CBD out of the narcotic law which will allow CBD based products to be sold over the counter.

● The new reform is expected to put into effect within the next coming months and it is expected to increase the number of patients and the demand for medical cannabis products after a long period of stagnation in the Israeli market. As we updated in the previous quarter, financially struggling companies and companies exiting the market continue to liquidize low-to-medium quality inventories at lower prices. This had an impact primarily on our ultra-medical and legacy products.

● On June 15, 2023, Tel Aviv-Jaffa District Court dismissed the lawsuit against Intercure and the parties agreed on a binding arbitration process in which the amount owed to Intercure and the parties will be determined and paid as part of a full separation process. According to the company’s position, Cannolam owes Intercure tens of NIS millions (which are not included in the financial assets mentioned) and Intercure’s claim has been submitted to an arbitrator who is expected to rule within the next month. The separation process has a negative effect on the performance of Cannolam that could not be evaluated at this time, Intercure intends to exhaust its full rights against the minority shareholders of Cannolam. Previously, on April 24, 2023, a lawsuit was filed against Intercure in Tel Aviv-Jaffa District Court in Israel by minority shareholders of our subsidiary, Cannolam. The lawsuit relates to disagreements concerning the ongoing management of Cannolam. Intercure has conducted a preliminary review of the claims made by the minority shareholders and find that they lack a valid legal basis.

● Commercial launches of our GMP products in UK and Germany expected during the fourth quarter of 2023 and the first quarter of 2024 as registration process are undergoing.

“First half of 2023 is another solid performance for Inercure, with year-over-year revenue growing 14% to $ million and adjusted EBITDA margin of 14%. I am proud of our team ability to execute despite some challenging market conditions when big players are exiting the space.” said InterCure CEO Alexander Rabinovitch. In the second quarter we generated $31 million in operating cash flow and ended the quarter with $42 million of cash and $25 of financial assets on our balance sheet. We continue to optimize our operations for continued growth supported by our leading position. We are encouraged from the new regulations in Israel and Germany as pharmaceutical cannabis becoming a world standard across Europe and many other territories. We are also keeping an open eye on the U.S. Department of Health and Human Services scientific and medical evaluation, supporting cannabis to be classified as a Schedule III drug by the DEA and the opportunities it may generate to Intercure.”

Half Year Revenues 2020 to 2023

 

Key Quarterly Financial Highlights – Cannabis Sector

	H1-23			H2-22			H1-22			H2-21			H1-21
Revenues		208,614			206,178			182,506			141,396			78,281
Gross Profit (1)		67,945			81,558			77,399			61,295			34,694
GP Margin		33	%		40	%		42	%		43	%		44	%
Adjusted EBITDA(2)		29,669			40,714			43,411			35,132			21,765
Adjusted EBITDA(2) Margin		14	%		20	%		24	%		25	%		28	%

Notes

(1)	Gross profit before effect of fair value.
(2)	EBITDA adjusted for changes in the fair value of inventory, share-based payment expense, impairment losses (and gains) on financial assets, non-controlling interest and other expenses (or income). This is a non-IFRS financial measure and does not have a standardized meaning prescribed by IFRS, please see “Non-IFRS Measures” below.

About InterCure (dba Canndoc)

InterCure (dba Canndoc) (NASDAQ: INCR) (TASE: INCR) is the leading, profitable, and fastest growing cannabis company outside of North America. Canndoc, a wholly owned subsidiary of InterCure, is Israel’s largest licensed medical cannabis producer and one of the first to offer Good Manufacturing Practices (GMP) certified and pharmaceutical-grade medical cannabis products. InterCure leverages its international market leading distribution network, best in class international partnerships and a high-margin vertically integrated “seed-to-sale” model to lead the fastest growing cannabis global market outside of North America.

For more information, visit: http://www.intercure.co.

Non-IFRS Measures

This press release makes reference to certain non-IFRS financial measures. Adjusted EBITDA, as defined by InterCure, means earnings before interest, income taxes, depreciation, and amortization, adjusted for changes in the fair value of inventory, share-based payment expense, impairment losses (and gains) on financial assets, non-controlling interest and other expenses (or income). This measure is not a recognized measure under IFRS, does not have a standardized meaning prescribed by IFRS and is therefore unlikely to be comparable to similar measures presented by other companies. InterCure’s method of calculating this measure may differ from methods used by other entities and accordingly, this measure may not be comparable to similarly titled measured used by other entities or in other jurisdictions. InterCure uses this measure because it believes it provides useful information to both management and investors with respect to the operating and financial performance of the company. A reconciliation of Adjusted EBITDA to an IFRS measure (revenue), which is incorporated by reference to this press release, is available in InterCure’s MD&A included in our Annual Report on Form 20-F under the heading “Results of Operation”, available under the Company’s profile on SEDAR at www.sedar.com.

Forward-Looking Statements

This press release may contain forward-looking statements. Forward-looking statements may include, but are not limited to, statements relating to InterCure’s objectives plans and strategies, as well as statements, other than historical facts, that address activities, events or developments that InterCure intends, expects, projects, believes or anticipates will or may occur in the future. These statements are often characterized by terminology such as “believes,” “hopes,” “may,” “anticipates,” “should,” “intends,” “plans,” “will,” “expects,” “estimates,” “projects,” “positioned,” “strategy” and similar expressions and are based on assumptions and assessments made in light of management’s experience and perception of historical trends, current conditions, expected future developments and other factors believed to be appropriate. Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied in such statements. Many factors could cause InterCure’s actual activities or results to differ materially from the activities and results anticipated in forward-looking statements, including, but not limited to, the following: the Company’s future revenue growth and profitability, the success of its global expansion plans, its continued growth, the expected operations, financial results business strategy, competitive strengths, goals and expansion and growth plans, expansion strategy to major markets worldwide, the impact of the COVID-19 pandemic and the war in Ukraine, macro economic factors (including inflation) and uncertainty created as a result of the socio-political situation in Israel. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond InterCure’s control, which could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. Such risks and uncertainties include, but are not limited to: changes in general economic, business and political conditions, changes in applicable laws, the U.S. regulatory landscapes and enforcement related to cannabis, changes in public opinion and perception of the cannabis industry, reliance on the expertise and judgment of senior management, as well as the factors discussed under the heading “Risk Factors” in InterCure’s Annual Information Form for the year ended December 31, 2022, which is available on SEDAR at www.sedar.com, and under the heading “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in the registration statement on Form 20-F, filed with the Securities Exchange Commission on May 1, 2023. InterCure undertakes no obligation to update such forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable law.

Contact:

Amos Cohen, Chief Financial Officer (Amos@intercure.co)

CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

As of June 30, 2023 (Unaudited)

Condensed Consolidated Interim Statements of Financial Position

	For the 6-months ended on June 30
	NIS in thousands
	2023			2022
	(Unaudited)			(Audited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents		102,653			232,589
Restricted cash		13,788			13,907
Trade receivables, net		42,623			36,919
Other receivables		91,747			97,375
Inventory		136,443			120,133
Biological assets		7,058			6,365
Financial assets measured at fair value through profit or loss		192			205
Total current assets		394,504			507,493
NON-CURRENT ASSETS:
Property, plant and equipment and right-of-use asset		96,970			103,133
Goodwill		284,181			284,181
Deferred tax assets		23,625			20,635
Financial assets measured at fair value through profit or loss		2,565			2,565
Investment in associate and loan		40,000			40,000
Total non-current assets		447,341			450,514
TOTAL ASSETS		841,845			958,007
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
Short term loan and current maturities		56,521			126,935
Trade payables		104,605			126,067
Other payables		39,524			48,397
Contingent consideration		6,145			10,230
Short term loan from non-controlling interest		957			1,090
Total current liabilities		207,752			312,719
LONG-TERM LIABILITIES:
Long term loans		84,067			99,684
Liabilities in respect of employee benefits		1,079			1,025
Lease liability		21,295			23,102
Total long-term liabilities		106,441			123,811
EQUITY:
Share capital, premium and other reserves		634,383			632,025
Capital reserve for transactions with controlling shareholder		2,388			2,388
Receipts on account of shares		8,541			8,541
Accumulated losses		(136,552	)		(141,649	)
Equity attributable to owners of the Company		508,760			501,305
Non-controlling interests		18,892			20,172
TOTAL EQUITY		527,652			521,477
TOTAL LIABILITIES AND EQUITY		841,845			958,007

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

	For the 6-months ended on June 30						Year ended December 31
	NIS in thousands
	2023			2022			2022
	(Unaudited)			(Unaudited)			(Audited)
Revenue		208,614			182,506			388,684
Cost of revenue before fair value adjustments		140,669			105,107			229,727
Gross income before impact of changes in fair value		67,945			77,399			158,957
Unrealized changes to fair value adjustments of biological assets		4,339			7,881			13,054
Loss from fair value changes realized in the current year		5,316			2,270			16,928
Gross Profit		66,968			83,010			155,083
Research and development expenses		256			338			632
General and administrative expenses		21,856			16,958			36,082
Sales and marketing expenses		27,800			24,112			56,533
Other expenses, net		2,919			1,124			2,128
Changes in the fair value of financial assets through profit or loss, net.		12			123			174
Share based payments		2,358			2,441			8,907
Operating Profit		11,767			37,914			50,627
Financing income		2,252			8,805			8,170
Financing expenses		11,842			6,099			14,955
Financing expenses (income), net		9,590			(2,706	)		6,785
Profit before tax on income		2,177			40,620			43,842
Tax (expense) benefit		1,640			(10,445	)		(93	)
Total comprehensive Profit (loss)		3,817			30,175			43,749
Profit (loss) attributable to:
Owners of the Company		5,097			29,012			44,819
Non-controlling interests		(1,280	)		1,163			(1,070	)
Total		3,817			30,175			43,749
Interest / Financing expense (income) net		9,590			(2,706	)		6,785
Tax expenses (benefit)		(1,640	)		10,445			93
Depreciation and amortization		6,442			4,629			2,354
EBITDA		18,209			42,543			52,981
Share-based payment expenses		2,358			2,441			(2,004	)
Other expenses (income(, net		2,919			1124			2128
Impairment losses and (gains) on financial assets through profit and loss		12			123			174
Fair value adjustment to inventory		977			(5611	)		(3527	)
Adjusted EBITDA		24,475			40,620			49,752
Earnings per share
Basic earnings		0.11			0.64			0.99
Diluted earnings		0.11			0.64			0.99