Intercure Ltd.

Good day and thank you for standing by. Welcome to the Intacure second quarter 2022 earnings call and webcast. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you will need to press star 1-1 on your telephone. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Adam Haliva, Communications Officer. Please go ahead.

thank you michelle and good morning everyone and welcome to intercure's second quarter 2022 results conference call and webcast a copy of the company's earnings press release is available on the news and events section of our website at www.intercure.co with me on today's call are alex rabinovich intercure's chief executive officer and amos coin the company's chief financial officer Today, we'll review the highlights and financial results for the first quarter and the June 30th, 2022, as well as more recent developments. Following these formal remarks, we will be prepared to answer your questions. But before we begin, please let me remind you that during this conference call, Intercures Management may make forward-looking statements made within the meaning of applicable security laws. Forward-looking statements may include but are not necessarily limited to financial projections or other statements of the company's plans, objectives, expectations, or intentions. These forward-looking statements are based on current expectations that are subject to a number of risks and uncertainties that may cause actual results to differ materially from those expressed or implied in such statements. Factors that could cause actual results to differ materially include, but are not limited to, the risk factors contained in the company's filings with CDAR and the Securities and Exchange Commission. Please also note any forward-looking statements made here are as of today and except to the extent required by law, the company assumes no obligation to update statements as circumstances changes. Also, please note that all amounts expressed today and during this call are in Canadian dollars or new Israeli shekels, unless otherwise noted. And with that, I will turn over the call to Alex Rabinovich, Insecure's CEO. Alex, please go ahead.

Thank you, Adam. Good morning, everyone, and thank you for joining us for our second quarter 2022 earnings call. I'm proud to report that InterQ has a record-breaking second quarter with quarter-over-quarter top-line growth of 9%, reaching $37 million, more than double the revenue of our second quarter 2021. This marks our third consecutive quarter of high growth, representing an annual run rate of $150 million. Our momentum coming out of our last quarter and our continued focus on execution and financial discipline resulted in another strong performance in the second quarter. Adjusted EBITDA grew by 4% to $9 million, which represents 22% of revenues. Additionally, gross profit increased by over 150% over the year and 60% sequentially for over $60 million during the second quarter. Q2 was also our end consecutive quarter with positive cash flow from operation as we exited the quarter with $96 million in cash. As I'm sure you're all aware, I'm very proud of our team delivering a solid performance. We continue to expand and grow our dynamic international supply chain, which now stretches across four continents, utilizing six high-end cultivation sites across the globe to supply the growing demand for our high-quality breaded pharmaceutical-grade medical cannabis products. During the second quarter, we continued investing in scaling up our cultivation, production, and dispensing operations. Our southern cultivation site, located near the Gaza Strip, was able to remain 100% operational during the recent military conflicts in the area as we designed and built an armored layout that saved about 150 employees.