Village Farms reports double digit growth in net sales

Village Farms reported a net sales increase of 10% for the year ended December 2016. Net sales reached 155.5 million dollars. That is an increase of more than 13 million compared to 2015. Michael DeGiglio, Chief Executive Officer, stated “One of our core goals for 2016 was to initiate double digit growth in market share and revenue. Revenues increased 10% in 2016 to USD 155,502,000 (CA $206,121,000), as compared to 2015 revenues.”

The increase in net sales is due to an increase in supply partner revenues of 57% over the comparable period in 2015. Village Farms product revenues decreased (3%) for the year ended December 31, 2016 versus the year ended December 31, 2015 due to lower tomato pounds as a result of crop issues primarily relating to TOV and beefsteak varieties at our Canadian facilities. The net price for all tomato pounds sold increased 2% for the year ended December 31, 2016, versus the year ended December 31, 2015, which was driven by an increase in the volume of higher priced specialty tomatoes sold. Cucumber prices increased 1% and cucumber pieces sold increased 18% for the year ended December 31, 2016 over the comparable period in 2015. The sales of cucumber pieces increased due to a 20% increase in partner suppliers and a 16% increase from the Company’s own facility. The increase at the Company’s owned facility is due to the impact of supplemental lights on the cucumber area during 2016.

“With the addition al growing capacity of Great Northern Hydroponics’ 65 acre facility, one of the premier growers in Leamington, Ontario, who exclusively aligned with us for their marketing and sales activities in late 2015, we successfully integrated this new capacity with our unique varieties enabling additional customer expansion and penetration,” says Michael DeGiglio.

“During 2016, larger investments were made in sales, marketing, fulfilment and development activities to build a broader distribution platform for anticipated growth. We are confident in our plans to drive increases in revenue, profit performance and market value through a combination of , among other things, marketing alliances, partnerships, new retailer and product launches, possible NAFTA agreement enhancements and the implementation of alternative crop strategies.”

Net (loss) income for the year period ended December 31, 2016 decreased (USD 4,077) to a loss of (USD 1,983) from income of $2,094 for the year period ended December 31, 2015. The decrease is primarily a result of a decrease in the change in fair value of biological assets of (USD 3,423) and higher selling, general and administrative expenses.

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