Village Farms (TSX: VFF) (NASDAQ: VFF) this morning reported its second quarter financial results. The firm posted revenues of US$70.4 million, beating consensus estimates of $62.99 million for the three month period.
Sales during the quarter were largely comprised of Produce revenues, which came in at $45.5 million, while revenues from the firms portion of Pure Sunfarms amounted to $24.8 million, and VFCE revenues added $0.1 million to the total. Revenues however did not come cheaply, with cost of sales amounted to $65.1 million, resulting in gross margins of just $5.3 million.
Operationally, the company ran into the red, with selling, general and administrative expenses totaling out at $9.0 million, higher than gross margins for the quarter. Share based compensation meanwhile amounted to $1.9 million, while interest expenses came in at $0.6 million.
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Overall, Village Farms reported a net loss of $4.5 million for the three month period, compared to a net loss of $7.4 million in the first quarter. Adjusted EBITDA however was positive, coming in at $1.5 million, which is higher than the $1.31 million consensus estimate from analysts.
Cash and cash equivalents as of the end of the quarter totaled $114.0 million.
Speaking to the firms cannabis division, Pure Sunfarms, specifically, the division reportedly saw adjusted EBITDA of US$7.4 million, a result of strong net sales improving to US$24.7 million during the quarter. The division reportedly is producing gross margins of 40%, an improvement from the 33% reported in the year ago period.
Village Farms last traded at $12.47 on the TSX.
Information for this briefing was found via Sedar and Village Farms International. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
