Village Farms International, the parent company of Pure Sunfarms, reported US$39.2 million in cannabis sales for the three months ended March 31, 2025 (Q1 2025). (All figures in US dollars).
The bulk of those sales, $34.8 million, were from the Canadian market (including exports), for a net of $3 million after costs of sales and other expenses.
The bulk of those cannabis sales were from branded revenues, $22.8 million (reported net of excise tax on products), while $6.3 million came from non-branded sales. In addition to sales through Pure Sunfarms, Village Farms has an 80% ownership interest in Rose LifeScience Inc., with a presence in Quebec as a cannabis supplier, producer, and commercialization expert.
Another $5.4 million came from international sales, while sales in the US under the company’s wholly owned subsidiary, Balanced Health Botanicals, were $3.9 million. Balanced Health develops and sells cannabidiol (CBD) based products in the US market, including ingestibles, edibles, and topicals. Net income from US cannabis sales, after costs, was $58,000.
Village Farms also owns Leli Holland BV, a vertically integrated licensed producer and supplier of cannabis products sold to coffee shops in the Netherlands. The company reported $486,000 in sales through Leli. The first harvest from the Leli facility was expected to hit markets earlier this year. After expenses, Village Farms reported a net loss of $242,000 from its Netherlands facility.
Branded cannabis sales in Canada were down 27.5% from the same quarter in the previous year (Q1 2024), while non-branded sales remained relatively level (-3.2%).
International cannabis sales were up 72.2% year-over-year from Q1 2024, while sales in the US were down 16.2%.
“Our first quarter results demonstrate success in our strategy to drive more profitable sales in Canadian Cannabis, with our strongest quarter of adjusted EBITDA performance in three years and another quarter of healthy cash flow from operations,” said President and Chief Executive Officer Michael A. DeGiglio.
“Sales of higher margin medical exports from Canada grew 285% year-over-year, contributing to gross margin expansion in Canadian Cannabis to 36% and placing us firmly on track to meet our stated target of tripling international export sales in 2025. We are maintaining a top market share position in Canada despite our reduction in lower-margin branded sales, and feel confident in our ability to drive operating leverage through the business as our international revenues continue to increase.”
“The first quarter also saw the initial contribution of our first European recreational cannabis sales through our Leli Holland subsidiary in the Netherlands, where sales began in late February,” he added.
“Our Phase I operations are now fully ramped, and we are feeling very confident about the quality of our products and position in this new marketplace. We are continuing to introduce new products into the market and expect to complete our Phase II facility in Groningen in Q1 2026. The completion of our Phase II facility is expected to quintuple our annual production capacity, and given the more favourable margin profile of our Netherlands recreational sales, we believe this will position us to drive a very strong year of profitable growth in 2026.”
High taxes in Canada, flower prices increasing
For the three months ended March 31, 2025, Village Farms incurred excise duties from Canadian cannabis sales of $13.9 million (C$20 million), or 38% of gross branded sales. This compares to $19.7 million (C$26.6 million), or 40% of gross branded sales, for the three months ended March 31, 2024.
For the three months ended March 31, 2025, 65% of net sales were generated from branded flower, pre-rolls and cannabis derivative products, down from 77% for the three months ended March 31, 2024.
Non-branded, international, and other sales accounted for 35% of Canadian cannabis net sales for the three months ended March 31, 2025, compared with 23% for the three months ended March 31, 2024.
The net average selling price of branded flower and pre-roll formats also increased in 2025 compared to 2024. Excluding pre-roll formats, the average net selling price of branded flower increased by 11% in 2025 due to a lower sales ratio for Pure Sunfarms’ value brand, Fraser Valley Weed Co.
The net average selling price of bulk non-branded flower increased by 33% and bulk trim increased by 43% in 2025, which the company says is primarily due to an increase in the market price and a reduced need to move aged flower inventory compared to 2024.
Written May 12, 2025 | Sarah Clark. Posted in Policy.