May 14, 2015, Vancouver – Village Farms International, Inc. is continuing to experience “improved market conditions.”
The company posted its first quarter results (which ended March 31) for 2015 earlier today.
“While the first quarter of 2015 continued the quarter on quarter trend of improved market conditions over previous corresponding year’s quarterly period,” said CEO Michael DeGiglio, “we also experienced historically low light levels throughout the entire first quarter and into the second quarter at our Texas locations.
“The lower light levels were the lowest since the inception of our west Texas operations in 1996.”
Over the first 16 weeks of the year, the average Texas light levels were 21 per cent lower than the historical average, with some weeks 45 per cent lower. If not for the lower light levels, the 2015 first quarter results would have exceeded company expectations.
“The low light levels continued until the end of April and will negatively impact our second quarter results,” DeGiglio explained.
“The produce normally harvested in the first quarter was delayed and is now being harvested in the second quarter, when ample supply exists in the marketplace. This can be seen on our income statement with a substantially lower change in bio asset, as April 2015 pricing was lower than April 2014 pricing. As such, our second quarter performance is off to a very slow start.”
A leading U.S. retailer has recently taken one of Village Farms’ new exclusive varieties national under the retailer’s private label. Other retailers are in the process of launching this same variety as well as additional exclusive products in the coming months.
Village Farms is quite satisfied with the first supplemental lighting investment at its Permian Basin facility, which provided substantially more cucumbers throughout the winter, versus the prior year. It helped the company avoid the negative production impact caused by lower light levels experienced on its tomato crop.
“We remain focused on strategic developments and operational enhancements to positively impact our 2015 performance over 2014 and to put us in a position to increase our market share with national retailers in both the U.S. and Canada,” said DeGiglio.
Net sales increased 16 per cent to $27.7 million (US) for the first quarter of 2015 compared to $24.0 million for the first quarter of 2014.
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