Michael Regan's questions to Village Farms International (VFF) leadership • Q3 2024
Question
Michael Regan sought to clarify the margin potential of the Netherlands facility, asking if its profitability would significantly exceed that of the Canadian operations given the much higher pricing and lack of excise tax. He also questioned whether the non-branded sales in Canada were opportunistic or part of a more recurring, relationship-based strategy.
Answer
CEO Mike DeGiglio confirmed that margins from the Netherlands facility will be 'well in excess' of Canadian margins and more aligned with their U.S. business, which operates in the 60-70% range. COO Ann Gillin Lefever clarified that the non-branded B2B sales in the quarter were opportunistic, driven by favorable strengthening in market pricing, rather than a strategic shift to an asset-light model. Mr. DeGiglio added that B2B and international sales are also attractive because they do not incur the Canadian excise tax.