What changed in this filing

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Item 1. Financial Statements

2024-11-07 compared with 2024-08-08 · 130 added, 105 removed, 321 unchanged (42% of the section changed)

3 unchanged sentences

(In thousands of United States dollars, except share data)

June 30, 2024

September 30, 2024

December 31, 2023

32 unchanged sentences

Common stock, no par value per share - unlimited shares authorized;

111,727,953 shares issued and outstanding at June 30, 2024 and 110,248,929 shares issued and outstanding at December 31, 2023.

112,337,049 shares issued and outstanding at September 30, 2024 and 110,248,929 shares issued and outstanding at December 31, 2023.

Additional paid in capital

10 unchanged sentences

(In thousands of United States dollars, except per share data)

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Cost of sales

2 unchanged sentences

Interest income

Foreign exchange (loss) gain

Foreign exchange gain (loss)

Other income (loss)

Goodwill and intangible asset impairments

Loss before taxes

Provision for income taxes

(Provision for) recovery of income taxes

Loss including non-controlling interests

net loss (income) attributable to non-controlling interests, net of tax

net income attributable to non-controlling interests, net of tax

Net loss attributable to Village Farms International, Inc.

4 unchanged sentences

Loss including non-controlling interests

Other comprehensive (loss) income:

Other comprehensive income (loss):

Foreign currency translation adjustment

Comprehensive (loss) gain including non-controlling interests

Comprehensive loss (income) attributable to non-controlling interests

Comprehensive (loss) gain attributable to Village Farms International, Inc.

Comprehensive gain (loss) including non-controlling interests

Comprehensive (income) loss attributable to non-controlling interests

Comprehensive gain (loss) attributable to Village Farms International, Inc.

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

2 unchanged sentences

(In thousands of United States dollars, except for shares outstanding)

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Number of Common

1 unchanged sentence

Additional Paid in Capital

Accumulated Other Comprehensive Loss

Accumulated Other Comprehensive (Loss) gain

Retained Earnings

2 unchanged sentences

Mezzanine Equity

Balance April 1, 2024

Balance July 1, 2024 as previously reported

Balance July 1, 2024

Share-based compensation

Acquisition of Redeemable non-controlling interest

Acquisition of non-controlling interest

Cumulative translation adjustment

Net (loss) income

Balance at June 30, 2024

Three Months Ended June 30, 2023

Balance at September 30, 2024

Three Months Ended September 30, 2023

Number of Common

2 unchanged sentences

Accumulated Other

Comprehensive (Loss) Income

Comprehensive Loss

Retained Earnings

2 unchanged sentences

Mezzanine Equity

Balance at April 1, 2023

Balance at July 1, 2023

Share-based compensation

1 unchanged sentence

Net (loss) income

Balance at June 30, 2023

Six Months Ended June 30, 2024

Balance at September 30, 2023

Nine Months Ended September 30, 2024

Number of Common

6 unchanged sentences

Mezzanine Equity

Balance at January 1, 2024

Balance at January 1, 2024 as previously reported

Balance January 1, 2024

Share-based compensation

Acquisition of Redeemable non-controlling interest

Acquisition of non-controlling interest

Cumulative translation adjustment

Net (loss) income

Balance at June 30, 2024

Six Months Ended June 30, 2023

Balance at September 30, 2024

Nine Months Ended September 30, 2023

Number of Common

1 unchanged sentence

Accumulated Other

Comprehensive Income (Loss)

Comprehensive (Loss) Income

Retained Earnings

9 unchanged sentences

Net (loss) income

Balance at June 30, 2023

Balance at September 30, 2023

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

2 unchanged sentences

(In thousands of United States dollars)

Six Months Ended June 30,

Nine Months Ended September 30,

Cash flows provided by (used in) operating activities:

4 unchanged sentences

Amortization of deferred charges

Net gain (loss) attributable to non-controlling interest

Net income attributable to non-controlling interest

Interest expense

6 unchanged sentences

Changes in non-cash working capital items

Net cash provided by (used in) operating activities

Net cash provided by operating activities

Cash flows (used in) provided by investing activities:

5 unchanged sentences

Repayments on borrowings

Acquisitions, net

Purchase of Non-controlling interest

Proceeds from issuance of common stock and warrants

13 unchanged sentences

Village Farms International, Inc.

(“VFF” and, together with its subsidiaries, the “Company”, “we”, “us”, or “our”) is a corporation existing under the Ontario Business Corporations Act.

VFF’s principal operating subsidiaries as of June 30, 2024 were Village Farms Canada Limited Partnership, Village Farms, L.P., Pure Sunfarms Corp.

(“VFF” and, together with its subsidiaries, the “Company”, “we”, “us”, or “our”) is a corporation existing under the Business Corporations Act (Ontario).

VFF’s principal operating subsidiaries as of September 30, 2024 were Village Farms Canada Limited Partnership, Village Farms, L.P.(together, “Village Farms Fresh” or “VF Fresh”), Pure Sunfarms Corp.

(“Pure Sunfarms”), Balanced Health Botanicals, LLC (“Balanced Health”) and VF Clean Energy, Inc.

("VFCE") and Leli Holland B.

VFF also owns an 80 % interest in Rose LifeScience Inc.

(“Rose”) and an 85 % interest in Leli Holland B.V.

The address of the registered office of VFF is 4700-80th Street, Delta, British Columbia, Canada, V4K 3N3.

The address of the registered office of VFF is 79 Wellington Street West, Suite 3300, Toronto, Ontario, Canada, M5K 1N2.

The address of the principal executive office of VFF is 90 Colonial Center Pkwy, Lake Mary, Florida, United States, 32746.

The Company’s shares are listed on Nasdaq Capital Market (“Nasdaq”) under the symbol “VFF”.

Village Farms owns and operates sophisticated, highly intensive agricultural greenhouse facilities in British Columbia and Texas, where it produces, markets and sells premium-quality tomatoes, bell peppers and cucumbers.

Its wholly owned subsidiary, Pure Sunfarms, is a vertically integrated Licensed Producer ("LP") and supplier of cannabis products sold to customers throughout Canada and internationally.

Village Farms Fresh owns and operates sophisticated, highly intensive agricultural greenhouse facilities in British Columbia and Texas, where it produces, markets and sells premium-quality tomatoes, bell peppers and cucumbers.

Its wholly owned subsidiary, Pure Sunfarms, is a vertically integrated Licensed Producer and supplier of cannabis products sold to customers throughout Canada and internationally.

The Company’s wholly owned subsidiary, Balanced Health, develops and sells high-quality, cannabidiol (“CBD”) based products including ingestible, edible and topical applications within the U.S.

10 unchanged sentences

Interim period operating results do not necessarily indicate the results that may be expected for any other interim period or for the full fiscal year.

The Company believes that the disclosures made in these consolidated financial statements are adequate to make the information not misleading.

The Company believes that the disclosures made in these condensed consolidated financial statements are adequate to make the information not misleading.

Principals of Consolidation

15 unchanged sentences

dollars at historical exchange rates.

All other accounts are remeasured at current exchange rates.

Gains or losses from remeasurement are included in foreign exchange (loss) gain.

Currency gains or losses resulting from transactions executed in currencies other than the functional currency are included in foreign exchange (loss) gain.

In these condensed consolidated financial statements, “$” means U.S.

dollars unless otherwise noted.

All other accounts are remeasured at current exchange rates, with both gains or losses from remeasurement and currency gains or losses from transactions executed in currencies other than the functional currency included in foreign exchange (loss) gain.

VILLAGE FARMS INTERNATIONAL, INC.

1 unchanged sentence

(In thousands of United States dollars, except per share amounts, unless otherwise noted)

In these condensed consolidated financial statements, “$” means U.S.

dollars and "C$" means Canadians dollars, unless otherwise noted.

Revision of Prior-Period Consolidated Financial Statements

In connection with the preparation of our third quarter 2024 condensed consolidated interim financial statements, the Company identified an immaterial misstatement in its estimate of its deferred tax asset valuation allowance as of the year ended December 31, 2023.

As a result, we recorded a decrease to deferred tax assets as of December 31, 2023 and increase in income tax expense for the year ended December 31, 2023 for $ 3,000 , which decreased total assets and retained earnings as of December 31, 2023 and increased our net loss for the year ended December 31, 2023 by $ 3,000 .

Our revision had no impact to the Company’s consolidated statement of cash flows.

Additionally, our revision had no impact to the Company’s segment profit measure, compliance with debt covenants, or performance metrics used in the calculation of executive compensation as the impacted line items are excluded from these calculations.

We evaluated the materiality of the impact quantitatively and qualitatively and concluded it was not material to any of the prior periods.

General Economic, Regulatory and Market Conditions

The Company has experienced, and may continue to experience, direct and indirect negative effects on its business and operations from negative economic, regulatory and market conditions, including recent inflationary effects on fuel prices, labor and materials costs, elevated interest rates, potential recessionary impacts and supply chain disruptions that could negatively affect demand for new projects and/or delay existing project timing or cause increased project costs.

The Company has experienced, and may continue to experience, direct and indirect negative effects on its business and operations from negative economic, regulatory and market conditions, including inflationary effects on fuel prices, labor and materials costs, elevated interest rates, potential recessionary impacts and supply chain disruptions that could negatively affect demand for new projects and/or delay existing project timing or cause increased project costs.

The extent to which general economic, regulatory and market conditions could affect the Company’s business, operations and financial results is uncertain as it will depend upon numerous evolving factors that management may not be able to accurately predict, and, therefore, any future impacts on the Company’s business, financial condition and/or results of operations cannot be quantified or predicted with specificity.

3 unchanged sentences

Classification

June 30, 2024

September 30, 2024

December 31, 2023

7 unchanged sentences

Classification

June 30, 2024

September 30, 2024

December 31, 2023

4 unchanged sentences

Property, plant and equipment, net

Depreciation expense on property, plant and equipment, was $ 4,020 and $ 7,748 for the three and six months ended June 30, 2024, respectively and $ 2,953 and $ 6,157 for the three and six months ended June 30, 2023 , respectively.

On May 29, 2024 , the Company entered into a Share Purchase Agreement with Rose and non-controlling shareholders for the acquisition of an additional 10 % interest in Rose for a total cash purchase price of approximately $ 3,016 , which resulted in a reduction of mezzanine equity of ($ 5,209 ) and an increase in additional paid in capital of $ 2,193 .

The Company's ownership interest in Rose is now 80 %.

VILLAGE FARMS INTERNATIONAL, INC.

1 unchanged sentence

(In thousands of United States dollars, except per share amounts, unless otherwise noted)

Depreciation expense on property, plant and equipment, was $ 4,360 and $ 12,108 for the three and nine months ended September 30, 2024, respectively, and $ 3,208 and $ 9,365 for the three and nine months ended September 30, 2023, respectively.

Capitalized interest was $ 260 and $ 825 for the three and nine months ended September 30, 2024 , respectively, and $ 323 and $ 965 for the three and nine months ended September 30, 2023, respectively .

On September 24, 2024 , the Company acquired the remaining 15 % equity ownership interest in Leli for a total cash purchase price of approximately $ 801 , which resulted in a reduction of non-controlling interest of ($ 489 ) and a decrease in additional paid in capital of ($ 312 ).

The Company's ownership interest in Leli is now 100 %.

The Company's ownership interest in Rose is now 80 %.

GOODWILL AND INTANGIBLE ASSETS

The following table presents the changes in the carrying value of goodwill by reportable segment for the six months ended June 30, 2024:

The following table presents the changes in the carrying value of goodwill by reportable segment for the nine months ended September 30, 2024:

Cannabis - Canada

2 unchanged sentences

Foreign currency translation adjustment

Balance as of June 30, 2024

Balance as of September 30, 2024

Intangible Assets

1 unchanged sentence

Classification

June 30, 2024

September 30, 2024

December 31, 2023

4 unchanged sentences

Intangibles, net

* Indefinite-lived intangible assets

The expected future amortization expense for definite-lived intangible assets as of June 30, 2024 was as follows:

* Includes indefinite-lived intangible assets

The expected future amortization expense for definite-lived intangible assets as of September 30, 2024 was as follows:

Fiscal period

4 unchanged sentences

The Company considers external and internal factors, including overall financial performance and relevant entity-specific factors, as part of this assessment.

During the six months ended June 30, 2024 and 2023, the Company considered qualitative factors in assessing for impairment indicators for the Company’s U.S.

VILLAGE FARMS INTERNATIONAL, INC.

Notes to Condensed Consolidated Interim Financial Statements

(In thousands of United States dollars, except per share amounts, unless otherwise noted)

During the nine months ended September 30, 2024 and 2023, the Company considered qualitative factors in assessing for impairment indicators for the Company’s U.S.

and Canadian Cannabis segments.

2 unchanged sentences

- Cannabis segment more likely than not was impaired.

The Company reviewed the reporting segment's assets, including goodwill and intangible assets.

Based on recent historical performance during the quarter which has underperformed relative to budget, a revised June 30, 2024 forecast which shows a shortfall compared to the March 31, 2024 forecast, the new restrictions on CBD sales in an additional eight states at July 1, 2024, and the proliferation of unregulated hemp-derived products on the market which continues to challenge market share for the CBD industry, the Company concluded that as of June

VILLAGE FARMS INTERNATIONAL, INC.

Notes to Condensed Consolidated Interim Financial Statements

(In thousands of United States dollars, except per share amounts, unless otherwise noted)

30, 2024, the fair value of the brand intangible asset and goodwill was fully impaired and an impairment charge to intangibles of $ 1,900 and goodwill of $ 10,039 was allocated to the U.S.

The Company reviewed the reportable segment's assets, including goodwill and intangible assets.

Based on recent historical performance during the quarter which underperformed relative to budget, a revised June 30, 2024 forecast which resulted in a shortfall compared to the March 31, 2024 forecast, the new restrictions on CBD sales in an additional eight states at July 1, 2024, and the proliferation of unregulated hemp-derived products on the market which continues to challenge market share for the CBD industry, the Company concluded that as of June 30, 2024, the fair value of the brand intangible asset and goodwill was fully impaired and an impairment charge to goodwill of $ 10,039 and a charge to intangibles of $ 1,900 was allocated to the U.S.

Cannabis reporting unit.

Cannabis - U.S.

The fair value of the reporting unit was determined based on a discounted cash flow projection using projections for 2024 to 2028 with an average revenue growth rate of 6 % between 2025 to 2028 , followed by a terminal growth rate of 2 %.

Management concluded that as of June 30, 2024, the fair value was lower than its carrying amount and as a result, an impairment charge to goodwill of $ 10,039 was allocated to the reporting unit.

The fair value of the reporting unit was determined based on a discounted cash flow projection using projections for the remainder of 2024 to 2028 with an average revenue growth rate of 6 % between 2025 to 2028 , followed by a terminal growth rate of 2 %.

Management concluded that as of June 30, 2024, the fair value was lower than its carrying amount and as a result, an impairment charge to goodwill of $ 10,039 was recorded to the reporting unit.

The significant assumptions applied to the determination of the fair value are described below:

9 unchanged sentences

Specifically, the Company utilized a relief from royalty valuation technique to arrive at the fair value of the brand.

Management concluded that as of June 30, 2024, the fair value was lower than its carrying value of $ 1,900 as the notional brand maintenance costs exceeded the incremental royalty of 3.5 %.

Management concluded that as of June 30, 2024, the fair value was lower than its carrying value of $ 1,900 as the notional brand maintenance costs exceeded

VILLAGE FARMS INTERNATIONAL, INC.

Notes to Condensed Consolidated Interim Financial Statements

(In thousands of United States dollars, except per share amounts, unless otherwise noted)

the incremental royalty of 3.5 %.

Therefore, an impairment charge to the brand intangible of $ 1,900 was allocated to the reporting unit.

Cannabis - Canada

When the Company considered qualitative factors in assessing impairment indicators for Canadian Cannabis it concluded that no impairment indicators existed as no events or circumstances occurred that would, more likely than not, reduce the fair value of the reporting units to be below their carrying amounts.

At June 30, 2023 , the Company concluded that no impairment indicators existed as no events or circumstances occurred that would, more likely than not, reduce the fair value of the reporting units to be below their carrying amounts.

At September 30, 2024, when the Company considered qualitative factors in assessing impairment indicators for Canadian Cannabis, it concluded that no impairment indicators existed as no events or circumstances occurred that would, more likely than not, reduce the fair value of the reporting units to be below their carrying amounts.

At September 30, 2023 , the Company concluded that no impairment indicators existed as no events or circumstances occurred that would, more likely than not, reduce the fair value of the reporting units to be below their carrying amounts.

LINE OF CREDIT AND LONG-TERM DEBT

The following table provides details for the carrying values of debt as of:

June 30, 2024

September 30, 2024

December 31, 2023

3 unchanged sentences

matures February 7, 2026

Term loan - Pure Sunfarms - C$ 25.0 M - Canadian prime interest rate plus an applicable margin, repayable in quarterly payments equal to 2.50 % of the outstanding principal amount starting June 30, 2021 , interest rate of 8.95 %;

Term loan - Pure Sunfarms - C$ 25.0 M - Canadian prime interest rate plus an applicable margin, repayable in quarterly payments equal to 2.50 % of the outstanding principal amount, interest rate of 8.45 %;

matures February 7, 2026

BDC Facility - Pure Sunfarms - non-revolving demand loan repayable by monthly principal payments of C$ 52 and accrued interest at a rate of 10.20 %, matures December 31, 2031

The Company’s line of credit with Bank of Montreal ("Operating Loan") had $ 4,000 amount drawn on the facility as of June 30, 2024 and December 31, 2023.

The carrying value of the assets and securities pledged as collateral for the FCC Loan as of June 30, 2024 and December 31, 2023 was $ 80,400 and $ 117,293 , respectively.

The Company’s line of credit with Bank of Montreal ("Operating Loan") had $ 4,000 drawn on the facility as of September 30, 2024 and December 31, 2023.

The carrying value of the assets and securities pledged as collateral for the FCC Loan as of September 30, 2024 and December 31, 2023 was $ 74,942 and $ 117,293 , respectively.

The carrying value of the assets pledged as collateral for the Operating Loan as of September 30, 2024 and December 31, 2023 was $ 23,233 and $ 28,034 , respectively.

The Pure Sunfarms line of credit had a balance of $ 0 as of September 30, 2024 and December 31, 2023.

The Company is required to comply with financial covenants, measured either quarterly or annually depending on the covenant.

The Company was in compliance with all its credit facility covenants as of September 30, 2024.

The weighted average annual interest rate on short-term borrowings as of September 30, 2024 and December 31, 2023 was 9.21 % and 9.44 % , respectively.

Accrued interest payable on all long-term debt as of September 30, 2024 and December 31, 2023 was $ 405 and $ 390 , respectively, and these amounts are included in accrued liabilities in the Condensed Consolidated Statements of Financial Position.

VILLAGE FARMS INTERNATIONAL, INC.

1 unchanged sentence

(In thousands of United States dollars, except per share amounts, unless otherwise noted)

The carrying value of the assets pledged as collateral for the Operating Loan as of June 30, 2024 and December 31, 2023 was $ 23,359 and $ 28,034 , respectively.

The Pure Sunfarms line of credit had a balance of $ 0 as of June 30, 2024 and December 31, 2023, respectively.

The Company is required to comply with financial covenants, measured either quarterly or annually depending on the covenant.

The Company was in compliance with all its credit facility covenants as of June 30, 2024.

The weighted average annual interest rate on short-term borrowings as of June 30, 2024 and December 31, 2023 was 9.73 % and 9.44 % , respectively.

Accrued interest payable on all long-term debt as of June 30, 2024 and December 31, 2023 was $ 347 and $ 390 , respectively, and these amounts are included in accrued liabilities in the Condensed Consolidated Statements of Financial Position.

The aggregate annual principal maturities of long-term debt for the remainder of 2024 and thereafter are as follows:

4 unchanged sentences

The carrying value of line of credit, lease liabilities, notes payable, and debt approximate their fair values due to insignificant changes in credit risk.

Carrying amounts of other long-term financial instruments, excluding the Company's term loans, approximate fair value, since the instruments bear interest at variable or fixed rates which approximate market rates.

For its investments, the Company has selected the practicability election to fair value measurement, under which the investment is measured at cost, less impairment, plus or minus observable price changes of an identical or similar investment.

1 unchanged sentence

The Company leases its Rose office building from a Company employee who also owns a minority interest in Rose.

For the three and six months ended June 30, 2024, the Company paid C $ 151 and C $ 190 and for the three and six months ended June 30, 2023 the Company paid C $ 47 and C $ 92 , respectively, to lease this office space.

One of the Company’s employees is related to a member of the Company’s executive management team and received approximately $ 85 and $ 61 in salary and benefits during the six months ended June 30, 2024 and 2023, respectively.

On May 29, 2024, the Company entered into a Share Purchase Agreement with Rose and non-controlling shareholders, which includes two company employees, for the acquisition of an additional 10 % interest in Rose for a total cash purchase price of approximately $ 3,016 .

The Company has recorded a provision for income taxes of ($ 260 ) and ($ 580 ) for the three and six months ended June 30, 2024, respectively, compared with a provision for income taxes of ($ 1,299 ) and ($ 1,933 ) for the same periods last year.

For the three and nine months ended September 30, 2024, the Company paid C $ 40 and C $ 230 , respectively and for the three and nine months ended September 30, 2023 the Company paid C $ 80 and C $ 172 , respectively, to lease this office space.

One of the Company’s employees is related to a member of the Company’s executive management team and received approximately $ 45 and $ 130 in salary and benefits during the three and nine months ended September 30, 2024, respectively, and $ 42 and $ 103 in salary and benefits during the three and nine months ended September 30, 2023, respectively.

The Company has recorded a provision for income taxes of ($ 94 ) and ($ 674 ) for the three and nine months ended September 30, 2024, respectively, compared with a recovery of (provision for) income taxes of $ 1,664 and ($ 269 ) for the same periods last year.

The Company’s income tax provision is based on management’s estimate of the effective tax rate for the full year.

The tax (provision) benefit in any period will be affected by, among other things, permanent, as well as temporary, differences in the deductibility of certain items, changes in the valuation allowance related to net deferred tax assets, in addition to changes in tax legislation.

The tax (provision) benefit in any period will be affected by, among other things, permanent, as well as discrete items, differences in the deductibility of certain items, changes in the valuation allowance related to net deferred tax assets, in addition to changes in tax legislation.

As a result, the Company may experience significant fluctuations in the effective book tax rate (that is, tax expense divided by pre-tax book income) from period to period.

1 unchanged sentence

The Company analyzed all positive and negative evidence to determine if, based on the weight of available evidence, it is more likely than not to realize the benefit of the net deferred tax assets.

The recognition of the net deferred tax assets and related tax benefits is based upon the Company’s conclusions regarding, among other considerations, estimates of future earnings based on

The recognition of the net deferred tax assets and related tax benefits is based upon the Company’s conclusions regarding, among other considerations, estimates of future earnings based on information currently available and current and anticipated customers, contracts, and product introductions, as well as historical operating results and certain tax planning strategies.

Based on the analysis of all available evidence, both positive and negative, the Company has concluded that it does not have the ability to generate sufficient taxable income in the necessary periods to utilize the entire benefit for its deferred tax assets.

Accordingly, the Company established a valuati on allowance of $ 48,742 as of September 30, 2024 and $ 42,530 as of December 31, 2023.

The Company cannot presently estimate what, if any, changes to the valuation of its deferred tax assets may be deemed appropriate in the future.

VILLAGE FARMS INTERNATIONAL, INC.

1 unchanged sentence

(In thousands of United States dollars, except per share amounts, unless otherwise noted)

information currently available and current and anticipated customers, contracts, and product introductions, as well as historical operating results and certain tax planning strategies.

Based on the analysis of all available evidence, both positive and negative, the Company has concluded that it does not have the ability to generate sufficient taxable income in the necessary period to utilize the entire benefit for the deferred tax assets.

Accordingly, the Company established a valuation allowance of $ 45,571 as of June 30, 2024 and $ 39,530 as of December 31, 2023.

The Company cannot presently estimate what, if any, changes to the valuation of its deferred tax assets may be deemed appropriate in the future.

If the Company incurs future losses, it may be necessary to record additional valuation allowance related to the deferred tax assets recognized as of June 30, 2024.

As of June 30, 2024, the Company’s net deferred tax assets totaled $ 4,201 and were primarily derived from net operating loss carryforwards.

As of September 30, 2024, the Company’s net deferred tax assets totaled $ 1,201 a nd were primarily derived from a tax planning strategy to utilize a portion of its existing net operating loss carryforwards.

SEGMENT AND GEOGRAPHIC INFORMATION

Segment reporting is prepared on the same basis that the Company’s Chief Executive Officer, who is the Company’s Chief Operating Decision Maker, manages the business, makes operating decisions and assesses performance.

As of June 30, 2024 , the Company’s four segments are as follows:

Segment reporting is prepared on the same basis that the Company’s Chief Executive Officer, who is the Company’s Chief Operating Decision Maker, assesses performance and allocates resources.

As of September 30, 2024 , the Company’s four segments are as follows:

The Produce segment produces, markets, and sells premium quality tomatoes, bell peppers and cucumbers.

3 unchanged sentences

The Cannabis – United States segment develops and sells high-quality, CBD-based health and wellness products including ingestible, edible and topical applications.

The Energy business receives a royalty from a renewable natural gas facility that is located at the Company's Delta facility.

The Energy business receives a royalty from a renewable natural gas facility that is located in Delta, B.C.

The Company’s primary operations are in the United States and Canada.

Segment information is summarized below:

Three months ended June 30,

Six Months Ended June 30,

Three months ended September 30,

Nine Months Ended September 30,

Cannabis - Canada

2 unchanged sentences

Cannabis - United States

Income (loss) before taxes

Cannabis - Canada

Cannabis - United States

A reconciliation of the Company’s segment Income (loss) before taxes to the Condensed Consolidated Statements of Operations is summarized below:

Three months ended September 30,

Nine Months Ended September 30,

Segment operating income

Other corporate expenses, net

Total income (loss) before taxes

VILLAGE FARMS INTERNATIONAL, INC.

3 unchanged sentences

Basic and diluted net loss per common share is calculated as follows:

Three months ended June 30,

Six Months Ended June 30,

Three months ended September 30,

Nine Months Ended September 30,

Net loss attributable to Village Farms International, Inc.

5 unchanged sentences

SHAREHOLDERS’ EQUITY AND SHARE-BASED COMPENSATION

Share-based compensation expense was $ 2,196 and $ 2,601 for the three and six months ended June 30, 2024, respectively, and $ 656 and $ 2,388 for the three and six months ended June 30, 2023, respectively.

Stock option activity for the six months ended June 30, 2024 was as follows:

Share-based compensation expense was $ 875 and $ 3,476 for the three and nine months ended September 30, 2024, respectively, and $ 747 and $ 3,135 for the three and nine months ended September 30, 2023, respectively.

Stock option activity for the nine months ended September 30, 2024 was as follows:

Exercise Price

1 unchanged sentence

Forfeited/expired

Outstanding at June 30, 2024

Exercisable at June 30, 2024

Restricted shares activity for the six months ended June 30, 2024 was as follows:

Performance-based

Restricted Share Units

Outstanding at September 30, 2024

Exercisable at September 30, 2024

Restricted shares activity for the nine months ended September 30, 2024 was as follows:

Restricted Stock Grants

Weighted Average Grant Date Fair Value

1 unchanged sentence

Vested and Issued

Outstanding at June 30, 2024

Exercisable at June 30, 2024

Outstanding at September 30, 2024

Exercisable at September 30, 2024

On September 3, 2024, the Company granted 600,000 shares to a director of the Company.

VILLAGE FARMS INTERNATIONAL, INC.

1 unchanged sentence

(In thousands of United States dollars, except per share amounts, unless otherwise noted)

CHANGES IN NON-CASH WORKING CAPITAL ITEMS

Six Months Ended June 30,

CHANGES IN NON-CASH WORKING CAPITAL ITEMS AND SUPPLEMENTAL CASH FLOW INFORMATION

Nine Months Ended September 30,

Trade receivables

5 unchanged sentences

Other assets, net of other liabilities

The Company paid income taxes of $ 0 for the three and nine months ended September 30, 2024 and 2023.

The Company paid interest expense of $ 955 and $ 3,128 for the three and nine months ended September 30, 2024 , respectively, and $ 1,008 and $ 3,645 for the three and nine months ended September 30, 2023 , respectively.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements