The supplier of high-value, high-growth plant-based consumer packaged goods. Village Farms (Nasdaq: VFF), reported a transformational second quarter marked by record profitability and strategic operational moves that position the company for continued growth in the global cannabis market.
The quarter saw consolidated net income from continuing operations reach $9.9M, with adjusted EBITDA from continuing operations hitting $17.1M, both all-time records for the company. Management credited the results to improving earnings power and the successful scaling of its profitable global cannabis platform.
A major development during the quarter was the completion of a transaction to privatize approximately one-third of the company’s produce assets and operations through a new partnership. The deal generated $40M in cash proceeds, which Village Farms plans to deploy toward growth investments, while also enhancing the long-term upside of its produce business.
The company’s Canadian cannabis division delivered strong performance, highlighted by nearly 700% year-over-year growth in international exports, now representing about half the size of its retail branded sales. Village Farms also marked its first quarter of recreational cannabis sales in the Netherlands, expanding its European footprint.
Expansion Plans
Looking ahead, Village Farms will convert the remaining 550,000 square feet of its Delta 2 greenhouse in British Columbia to cannabis cultivation. Once fully ramped, the expansion is expected to add roughly 40 metric tons of annual production. Management anticipates the project will generate a substantial return on investment given ongoing strength in international demand and improving supply-demand dynamics in Canada.
Q&A Highlights
During the earnings call, CEO Mike DeGiglio emphasized the strategic rationale for the Delta 2 expansion, noting the low capital requirements, production flexibility, and the company’s track record of matching supply to market demand. President Ann discussed strong international growth particularly in Germany and the UK and the intention to remain a key player in the expanding global cannabis market. DeGiglio also reiterated the company’s focus on organic growth and its disciplined approach to mergers and acquisitions, while signaling potential opportunities in the U.S. market as federal regulations evolve.
The only noted drawback from the Q&A was the absence of detailed guidance for the second half of 2025. Management stated they expect performance in line with the first half but are cautious about setting expectations prematurely.
The post Village Farms Posts Record Profitability in Q2, Expands Cannabis Operations and Strengthens Balance Sheet, Shares Up 27% appeared first on PRISM MarketView.
