Village Farms reported record full-year 2025 profitability with continued strong fourth-quarter performance.

Village Farms International, Inc. ("Village Farms" or the "Company") (NASDAQ: VFF) today reported financial results for its fourth quarter and year ended December 31, 2025. All figures are in U.S. dollars unless otherwise indicated.

Management Commentary

"Our fourth quarter results again delivered strong profitability, gross margin and cash flow from operations which contributed to record levels of performance for each of these metrics in 2025," said President and Chief Executive Officer Michael DeGiglio. "Thanks to the tireless commitment and execution of our global team, this past year was a transformational one for Village Farms. We are continuing to benefit from multiple catalysts unlocking value for our stakeholders and believe we remain in an excellent position to continue profitably scaling our platform in 2026."

"We grew global cannabis sales by 17% year-over-year despite just a partial year of contributions from our expanding Netherlands business, and international exports increased more than six-fold as we continue to capitalize on our leadership position among the world's largest EU-GMP certified cannabis operators. We've set a higher standard for our Company on the global stage, and are continuing to invest behind our proven teams with enhancements to our operating capabilities."

"Demand for our products continues to significantly outpace our current production capacity, and temporary supply constraints coupled with rapidly evolving global regulatory frameworks has created near-term variability in performance as we balance the complex needs of our diverse customer base. In response to higher demand, we are pleased to report that last week we began cultivation in the first half of our previously-announced Delta 2 expansion in Canada, and that this project remains on track to harvest an incremental 15 tonnes of production capacity during the remainder of this year."

"Our first Netherlands facility continues to operate at full capacity with healthy margin performance, and we are in the process of scaling our local operating team there to support our Phase II facility in Groningen which remains on track for its first grow rooms to be planted at the end of Q1 with the full facility completed and planted by the end of Q2. Once fully ramped, we anticipate annual production capacity of approximately 10 tonnes in the Netherlands, where we continue to see a very strong pricing environment and are well positioned to capture market share in premium product categories."

"We look to the remainder of 2026 with a growth mindset, and expect to maintain a balanced approach to capital allocation with prudent consideration of accretive organic and acquisitive investments and enhanced value creation for shareholders in the form of ongoing share repurchases. We believe our growth investments, strong net cash position, industry leading cost of capital, and continued solid execution from our teams position us for continued success in 2026 and beyond."

Fourth Quarter 2025 Financial Highlights

(All comparable periods are for the fourth quarter of 2024 unless otherwise stated)

Consolidated

Consolidated net sales increased 9% to $49.6 million from $45.4 million;

Consolidated net income from continuing operations improved to $2.3 million, or $0.02 per share, from a net loss from continuing operations of $7.5 million, or ($0.04) per share driven by a $10.5 million non-cash impairment charge in the prior-year period related to non-flower inventory purchased primarily from third parties that did not meet the Company's quality standards;

Consolidated net income, including non-controlling interests and before equity losses, was $2.4 million, or $0.02 per share compared to net loss, including non-controlling interests and before equity losses, of $8.6 million, or ($0.07) per share;

Consolidated cash flow from continuing operations of $11.4 million compared with $10.9 million in the prior year period;

Full year consolidated cash flow from continuing operations increased to $58.1 million compared with $13.7 million in the prior-year period; and,

Consolidated adjusted EBITDA from continuing operations (a non-GAAP measure) was $8.6 million or 17.3% of sales, compared with ($2.9) million in the prior year period.

 

Canadian Cannabis

Net sales increased 10% to $37.8 million (C$52.7 million) from $34.3 million (C$48.0 million);

International export sales increased 384%; retail branded sales flat year-over-year in line with expectations;

Gross margin increased to 43% from 2%, driven by improvements in operating efficiency leading to lower costs of production, an increased mix of higher-margin sales, and the non-recurrence of a non-cash inventory impairment charge in the prior-year quarter;

Net income improved to $5.4 million (C$7.5 million) from negative $6.6 million (-C$9.4 million);

Adjusted EBITDA increased to $9.7 million (C$14.3 million) from negative $6.3 million (-C$9.1 million); and,

Cash flow from operations increased 752% to $15.7 million (C$21.5 million) from $2.6 million (C$3.3 million).

 

U.S. Cannabis

Net sales were $3.4 million compared with $4.6 million;

Gross margin decreased to 60% from 70%;

Net loss was ($0.2 million) compared with a net loss of $0.2 million; and

Adjusted EBITDA was ($0.1 million) compared with $0.3 million.

 

Netherlands Cannabis

Village Farms Netherlands was non-operational during the comparable quarter of 2024. As a result, comparative financial performance to the prior-year quarter is not meaningful.

Net sales were $3.3 million;

Net loss was ($0.1 million) driven by increased operating expenses to support the Company's Phase II expansion; and

Adjusted EBITDA was $0.7 million.

 

Produce

Sales from continuing operations of $4.9 million were down from $6.1 million as compared to the prior year as 2025 sales are net of a commission paid to Vanguard Food, L.P., as well as lower year-over-year pricing;

Net loss from continuing operations was ($1.6 million) compared to net income from continuing operations of $4.9 million; and,

Adjusted EBITDA from continuing operations was ($462 thousand) compared to adjusted EBITDA from continuing operations of $6.6 million which was the result of a legal settlement in the prior-year quarter.

 

Strategic Growth and Operational Highlights

Canadian Cannabis

The Company continues to maintain a top five overall market share position in Canada and held the number one position in dried flower as of February 20261 despite planned reductions in sales of lower-margin SKUs;

International export sales increased 384% year-over-year with demand from international customers continuing to meaningfully outpace current supply capabilities;

We surpassed the high end of our targeted gross margin range of 30-40%, marking the fourth consecutive quarter meeting or exceeding the target range and contributing to record annual Adjusted EBITDA performance;

Introduced several new and unique packaging innovations to the Canadian market, including the launch of a one-way aroma valve built directly into its dried flower packaging, windowed packaging for its flower products which enables consumers to see product before purchase, and a proprietary built-in matchbox accessory for its pre-roll offerings to meet growing demand for ready-to-enjoy cannabis experiences;

Named the winner of Business Vancouver's (BIV) 2026 BC Export Awards in the Consumer Products category, recognizing our exceptional performance and contribution to British Columbia's growing international trade economy;

Published groundbreaking peer-reviewed research in Scientific Reports (Nature Portfolio), highlighting the natural variability of THC potency within cannabis plants, reinforcing a need for a greater focus on product quality versus potency and more transparent and accurate labeling across the industry; and,

During the fourth quarter, started the expansion of cultivation capacity in the remaining half of its Delta 2 greenhouse to meet increasing demand in Canadian and our international export markets. Once completed and operating at full capacity, the expansion is expected to yield an incremental 40 tonnes of annualized cannabis production, expanding capacity by approximately 33% once completed.

1. Based on estimated retail sales from HiFyre, other third parties and provincial boards.

International Medical Cannabis (Reported Within Canadian Cannabis)

International export sales increased 384% year-over-year, driven by continued strength of demand in Germany and steady performance across other international markets;

We believe we remain the largest exporter of medical cannabis to Europe, with three of the top five leading cultivars in Germany and four of the top 10 through our third-party distribution partners2; and

The Company expects to return to sequential growth in international medical export sales in Q1 of 2026.

2. Based on Company estimates and rankings compiled by German outlet Flowzz.

Netherlands Cannabis

Operations at the Phase I facility in Drachten continue at full capacity, with continued strong margin performance and operating cash flow generation;

The Company's products are now represented in 96% of participating coffeeshops, representing increased market penetration of roughly 500 basis points sequentially from that of the third quarter;

The Company continued to advance new product innovation in the Netherlands market and subsequent to year end launched 10 new product offerings, including the first regulated blunt in market as well as infused spliffs and other pre-roll formats. It expects to continue launching new and innovative products in 2026; and

Construction of the Company's Phase II facility in Groningen is nearing completion with the first grow rooms expected to be planted in late Q1 with full facility completion and planting expected in Q2. Once fully ramped, the Phase II facility is expected to quintuple total annualized production to approximately 10 tonnes.

 

U.S. Cannabis

The Company believes it is poised to benefit from President Trump's Executive Order to reschedule marijuana, which, if rescheduled, would represent a consequential step in modernizing U.S. cannabis policy and support the development of a regulatory framework more aligned with international drug policies.

The Company's application for a Texas medicinal marijuana license remains under review by the Department of Public Services ("DPS"). In December 2025, nine new provisional licenses were awarded and DPS will award a minimum of three new awards on or before April 1, 2026. If awarded a license, the Company plans to work with its listing authority to structure an acceptable ownership structure and comply with all applicable regulatory requirements, which are still pending in Texas.

 

Corporate

Brian Stevenson was appointed to the newly created role of Global Chief Strategy Officer, where he is overseeing our enterprise-wide strategic agenda, including long-term growth strategy, global market assessment, and integration initiatives across regions and business units.

Brian Ellis was appointed to the newly created role of Chief Information and Technology Officer (CITO), where he is overseeing our enterprise architecture and IT strategy as we continue executing our global growth strategy and transformation initiatives.

On September 29, 2025, the Company's Board of Directors unanimously approved a US$10 million share repurchase authorization for up to 5,687,000 common shares (five percent of our issued and outstanding common shares at the date of announcement). During the fourth quarter of 2025, the Company repurchased 812,923 shares at a cost of $3.0 million and subsequent to year end it has purchased 1,099,753 shares at a cost of $3.7 million.

Subsequent to year end, the Company amended and extended its Canadian cannabis credit facility by upsizing loan commitments with existing lenders by CAD $15 million and extending maturities one year. The incremental financing comes in the form of a delayed draw term loan, from which the Company drew an initial CAD $5 million on February 20, 2026. All other terms of the credit facility loans remain unchanged, with variable interest rates currently below 6.0%.

 

Conference Call

Village Farms' management team will host a conference call to discuss its fourth quarter and full year 2025 financial results today, Thursday, March 12, 2026, at 8:30 a.m. ET.

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