Village Farms swings to profit in Q2

Village Farms International (NASDAQ: VFF), which was expected to report second quarter 2019 earnings results today at approximately 5:00 p.m. ET, published its quarterly results at 8:00 p.m. ET. The company’s earnings improved to $0.20 per share in the second quarter from a loss of $0.05 per share in the prior-year quarter. Village Farms stock ended down 1.33% at $13.35 when the markets closed today.

For the second quarter ended June 30, 2019, Village Farms reported net income of $9.89 million or $0.20 per diluted share compared to a loss of $2.28 million or $0.05 per diluted share in the quarter ended June 30, 2018. The recently ended quarter’s net income included the contribution of positive net income from Pure Sunfarms of $14 million.

Produce sales for the June quarter dropped to $41.33 miilion from $42.04 million in the quarter ended June 30, 2018. Consolidated sales, including Pure Sunfarms’ contribution of $12.12 million, increased to $53.45 million. Cost of goods sold (all in cost) per gram was CAD$0.65 (US$0.49) per gram.

Related: Aphria stock jumps after reporting better-than-expected Q4 results

“We expect Pure Sunfarms to deliver consistent quarter-on-quarter growth throughout this year and next, driven by Delta 3 now operating at full production, the anticipated start of sales directly to the Ontario Cannabis Store and other provincial/territorial and private retailers, expansion of product sales into pre-rolls and oils and other derivative products, and the doubling of capacity to 150,000 kilograms annually with its second 1.1 million square foot facility, Delta 2, expected to begin operations mid-2020 and achieve full production later that year,” said CEO Michael DeGiglio.

Related: What you need to know before buying Village Farms International stock

In the US, Village FArms established its second joint venture for outdoor hemp cultivation and CBD-extraction by adding Colorado to its production in three eastern states. DeGiglio added, “We remain firmly on track to begin sales of hemp biomass this year, transitioning to sales of CBD crude oil early in 2020, and then commence CBD product manufacturing.”

Since Village Farms started trading on NASDAQ on February 21 this year, the stock had rallied 35% so far. Shares of Village Farms were up slightly in the extended trading hours.

Get access to timely and accurate verbatim transcripts that are published within hours of the event