Vivien Azer's questions to Intercure (INCR) leadership • Q4 2022
Question
Vivien Azer inquired about the competitive dynamics in the Israeli market, specifically the product mix by price point and the drivers behind recent gross margin degradation. She also asked about the potential for margin recovery and the expected impact of international expansion on future margins and overall progress.
Answer
CEO & Director Alexander Rabinovitch explained that the Israeli market is approximately 70% high-quality products, a mix reflected in InterCure's portfolio. He attributed the Q4 margin pressure to competitors liquidating inventory at low prices, a trend he expects to resolve by the second half of 2023. Rabinovitch noted that international expansion into higher-priced markets like Germany and the UK should have a positive impact on gross margins as the company scales its operations there, following a careful, proven strategy.