Village Farms International Inc (VFF) 2025 Q2 法說會逐字稿

Good morning, ladies and gentlemen. Welcome to the Village Farms International second-quarter 2025 financial results call.

女士們、先生們，早安。歡迎參加 Village Farms International 2025 年第二季財務業績電話會議。

This morning, Village Farms issued a news release reporting its financial results for the second quarter ended June 30, 2025. That news release, along with the company's financial statements are available on the company's website at villagefarms.com, under the Investors heading.

今天上午，Village Farms 發布了一份新聞稿，報告了截至 2025 年 6 月 30 日的第二季財務表現。新聞稿以及本公司的財務報表可在本公司網站 villagefarms.com 的「投資者」標題下查閱。

Please note that today's call is being broadcast live over the Internet and will be archived for replay both by telephone and via the Internet beginning approximately one hour following completion of the call. Details of how to access the replays are available in today's news release.

請注意，今天的電話會議將透過網路進行現場直播，並將在電話會議結束後約一小時透過電話和網路進行存檔重播。有關如何觀看重播的詳細資訊請參閱今天的新聞稿。

Before we begin, let me remind you that forward-looking statements may be made today during or after the formal part of this conference call. Certain material assumptions were applied in providing these statements, many of which are beyond our control. These statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those expressed or implied in forward-looking statements.

在我們開始之前，請允許我提醒您，今天在本次電話會議的正式部分期間或之後可能會做出前瞻性陳述。在提供這些聲明時我們應用了某些重要假設，其中許多是我們無法控制的。這些聲明受到許多風險和不確定性的影響，可能導致實際結果與前瞻性聲明中表達或暗示的結果有重大差異。

A summary of these underlying assumptions, risks and uncertainties contained in the company's various securities filings with the SEC and Canadian regulators, including its Form 10-K, MD&A for the year ended December 31, 2024, and 10-Q for the quarter ended June 30, 2025, which will be available on EDGAR and SEDAR+. These forward-looking statements are made as of today's date and except as required by applicable securities law, we undertake no obligation to publicly update or revise any such statements.

本公司向美國證券交易委員會和加拿大監管機構提交的各種證券文件中包含的這些基本假設、風險和不確定性的摘要，包括截至 2024 年 12 月 31 日止年度的 10-K 表、MD&A 表和截至 2025 年 6 月 30 日止季度的 10-QGAR 表，將在 ED 和 SEDAR+ 表上提供。這些前瞻性陳述均截至今日作出，除適用證券法要求外，我們不承擔公開更新或修改任何此類陳述的義務。

I would now like to turn the call over to Michael DeGiglio, Chief Executive Officer of Village Farms International. Please go ahead.

現在我想把電話轉給 Village Farms International 執行長 Michael DeGiglio。請繼續。

Well, thank you, Tanya. And good morning, and thank you for joining us today. With me are Steve Ruffini, our Chief Financial Officer; Ann Gillin Lefever, our Chief Operating Officer; Patti Smith of Corporate Controller; and Sam Gibbons, Senior Vice President, Corporate Affairs.

好吧，謝謝你，Tanya。早安，感謝您今天加入我們。和我一起的還有我們的財務長史蒂夫·魯菲尼 (Steve Ruffini)、我們的營運長安·吉林·勒菲弗 (Ann Gillin Lefever)、公司財務總監帕蒂·史密斯 (Patti Smith) 和公司事務高級副總裁薩姆·吉本斯 (Sam Gibbons)。

I'll begin with a brief summary of recent events and our second-quarter highlights, and then I'll hand the call over to Steve before some last closing comments. The second quarter was transformational. It was a transformational quarter for Village Farms, just to be clear, operationally and financially, with record levels of profitability that demonstrate the improving earnings power of our business and continued success in scaling a profitable global cannabis enterprise.

我將首先簡要概述最近發生的事件和我們第二季度的亮點，然後在最後的總結發言之前，我將把電話交給史蒂夫。第二季是變革性的。需要明確的是，從營運和財務角度來看，這是 Village Farms 的一個轉型季度，其盈利水平創下了歷史新高，表明我們業務的盈利能力不斷提高，並在擴大盈利的全球大麻企業規模方面繼續取得成功。

During the quarter, we announced and then quickly closed the transaction to privatize about one-third of our produce assets and operations through the formation of a new partnership with proven private investment partners. Most on this call are familiar with the details of the new Vanguard partnership, and they are available in our various communications and filings, so I won't repeat them here.

在本季度，我們宣布並迅速完成了一項交易，透過與可靠的私人投資夥伴建立新的合作夥伴關係，將我們約三分之一的生產資產和業務私有化。參加這次電話會議的大多數人都熟悉新的先鋒合作夥伴關係的細節，這些細節可以在我們的各種通訊和文件中找到，因此我在這裡就不再重複了。

But I do want to take the opportunity to reiterate what all this means for Village Farms, our future prospects, our partners and team members, and of course our shareholders. First, we believe we have dramatically improved the long-term upside potential of our 36-year legacy in the produce industry. As a private company with access to significant financial resources that will add additional acquisitions in the future.

但我確實想藉此機會重申這一切對 Village Farms、我們的未來前景、我們的合作夥伴和團隊成員，當然還有我們的股東意味著什麼。首先，我們相信我們已經大大提高了我們在農產品行業 36 年歷史的長期上升潛力。作為一家擁有大量財務資源的私人公司，未來將進行更多收購。

Our commitment and experienced partners have created significant value for their shareholders in the past, and we are positioned to participate in this renewed opportunity through our near 38% equity ownership interest.

我們的承諾和經驗豐富的合作夥伴過去為股東創造了巨大的價值，我們有能力透過近 38% 的股權參與這項新的機會。

Second, we believe Village Farms has transformed into one of the most attractive platforms for revenue growth and margin expansion across the global cannabis industry. With proven operational capabilities, we can now focus on our various cannabis opportunities around the world.

其次，我們相信 Village Farms 已經轉變為全球大麻產業最具吸引力的收入成長和利潤擴張平台之一。憑藉成熟的營運能力，我們現在可以專注於世界各地的各種大麻機會。

Third, the transaction generated $40 million in cash proceeds further strengthening our balance sheet, which along with our improving cash flow generation profile, we will support additional growth investments across the platform.

第三，這筆交易產生了 4,000 萬美元的現金收益，進一步增強了我們的資產負債表，再加上我們不斷改善的現金流產生狀況，我們將支持整個平台的額外成長投資。

And finally, our shareholders and prospective investors can now see the improving earnings potential of our remaining global cannabis business, which significantly improved forward visibility into our financial performance that is evident in our second-quarter results.

最後，我們的股東和潛在投資者現在可以看到我們剩餘的全球大麻業務的盈利潛力不斷提高，這顯著提高了我們財務業績的前瞻性可見性，這在我們的第二季度業績中得到了明顯體現。

Before I get into the second-quarter highlights, I want to make clear that the strength of our Q2 performance is not simply a result of us privatizing our produce business.

在介紹第二季的亮點之前，我想先明確指出，我們第二季業績的強勁成長不僅僅是我們將農產品業務私有化的結果。

The closing of that transaction has happened to coincide with several other powerful catalysts, including our recent commencement of sales in Holland's adult-use market, success of recent initiatives to align our product portfolio in Canada towards higher-margin SKUs, and finally, a continuing wave of additional countries around the world following Canada's lead with pragmatic approaches to regulating cannabis.

該交易的完成恰好與其他幾個強有力的催化劑相吻合，包括我們最近在荷蘭成人用品市場開始銷售，最近將我們在加拿大的產品組合調整為利潤率更高的 SKU 的舉措取得成功，最後，全球越來越多的國家紛紛效仿加拿大，採取務實的方式管理大麻。

All of these events are coinciding with near-impeccable timing. Yet it is the competitive strengths we've established over 36 years in controlled environmental agriculture that we are leveraging to deliver as one of the world's largest and most trusted scaled cannabis operators.

所有這些事件的發生時間都恰好吻合。然而，我們正利用 36 年來在受控環境農業領域建立的競爭優勢，成為世界上最大、最值得信賴的大麻營運商之一。

So now I'll shift to a review of our second-quarter highlights, which I'll focus on our performance from continuing operations, excluding the impact of the gain of our sale of produce assets during the quarter. As we disclosed in this morning's press release, second-quarter results reflected record levels of profitability for the company. And not just records since we expanded the cannabis in 2017, but record performance in our near 20-year history as a publicly traded company.

因此，現在我將轉而回顧我們第二季的亮點，並專注於我們持續經營的業績，不包括本季出售農產品資產收益的影響。正如我們在今天上午的新聞稿中所揭露的那樣，第二季的業績反映了公司創紀錄的獲利水準。這不僅是我們自 2017 年擴大大麻業務以來創下的記錄，也是我們作為一家上市公司近 20 年歷史上創下的記錄。

While consolidated sales increased 12% year-over-year, consolidated net income from continuing operations improved to $9.9 million, or $0.09 per share. Adjusted EBITDA from continuing operations was $17.1 million, or roughly 29% of sales, both of which reflect record performance and improved sustainability from Q2 of last year. And adjusted EBITDA margin was up over 2,300 basis points.

合併銷售額年增 12%，而合併持續經營淨收入則增至 990 萬美元，即每股 0.09 美元。持續經營業務的調整後 EBITDA 為 1,710 萬美元，約佔銷售額的 29%，這兩項數據均反映了創紀錄的業績和較去年第二季增強的可持續性。調整後的 EBITDA 利潤率上升了 2,300 個基點以上。

In our flagship market and Canadian cannabis business, retail branded sales in Q2 were in line with our expectations given our planned reduction in several low-margin domestic SKUs. We are not yet seeing the types of price increases that one might expect given the changing supply dynamic in the retail market, but we have been pleased to see stronger contribution margin from our retail branded sales in Q2, which demonstrates the success of our recent margin improvement initiatives.

在我們的旗艦市場和加拿大大麻業務中，鑑於我們計劃減少幾個低利潤的國內 SKU，第二季的零售品牌銷售額符合我們的預期。鑑於零售市場供應動態的變化，我們尚未看到人們預期的價格上漲，但我們很高興看到第二季零售品牌銷售的貢獻利潤率更高，這表明我們最近的利潤率提高舉措取得了成功。

In our wholesale channel, we continue to be optimistic in the contents of our focus on profitable sales. Q2 wholesale sales were consistent with the levels of last year or so. However, gross margin on these sales were up significantly on a year-over-year basis as we believe supply and demand dynamics are driving more favorable outcomes in the wholesale channel.

在我們的批發管道中，我們繼續對專注於獲利銷售的內容持樂觀態度。第二季批發銷售額與去年同期水準基本持平。然而，由於我們相信供需動態正在推動批發管道取得更有利的結果，這些銷售的毛利率比去年同期大幅上升。

These dynamics resulted in another quarter of improvement in overall Canadian cannabis gross margin, which was at the top of our target range at 39%, and our best quarterly gross margin in three years. We now delivered two consecutive quarters of gross margin within the targeted 30% to 40% range, and we are optimistic about our ability to sustain gross margin at the upper end of this range for the foreseeable future.

這些動態導致加拿大大麻整體毛利率再提高一個季度，達到我們目標範圍的最高值 39%，也是我們三年來最好的季度毛利率。我們現在已經連續兩個季度實現了 30% 至 40% 的目標毛利率，並且我們對在可預見的未來維持毛利率在這個範圍的上限的能力充滿信心。

Continued growth in Q2 was driven mainly by the successful execution of our international growth strategy. International exports increased almost 700% year-over-year and we're up over 120% sequentially from the first quarter. We have proven that our international model works, and we are now scaling it with purpose and precision.

第二季度的持續成長主要得益於我們國際成長策略的成功執行。國際出口較去年同期成長近 700%，較上季成長超過 120%。我們已經證明我們的國際模式是有效的，現在我們正在有目的、有精確地擴大它。

At just the halfway point of the year, we have achieved our full-year target of tripling our 2024 international export sales. And given continued strength in the third quarter, we expect similar levels of sales through the remainder of this year as compared to the first half. International prescribers and patients are constantly choosing our flower and we are seeing a strong preference for many of the strains that have been our most successful in Canada.

今年才剛過一半，我們就實現了 2024 年國際出口銷售額成長兩倍的全年目標。鑑於第三季的持續強勁表現，我們預計今年剩餘時間的銷售額將與上半年持平。國際處方醫生和患者不斷選擇我們的花卉，我們看到人們對我們在加拿大最成功的許多品種的強烈偏好。

During Q2, we increased deliveries to existing customers and also onboarded several new partners. Most of this growth is being driven by continued strength of demand from Germany, along with further increases in the UK, and steady performance across our other markets.

在第二季度，我們增加了對現有客戶的交付量，並加入了幾個新的合作夥伴。這一成長主要得益於德國需求的持續強勁，英國需求的進一步成長，以及我們其他市場的穩定表現。

Despite recent headlines about Germany's proposed telemedicine reforms potentially limiting growth, our sales in Germany [are the partners] operating within the traditional pharmacy network, and we do not currently work with any telemedicine platforms. We have not experienced any impact to existing patients, or disruption, with our pharmacy model customers and distributors.

儘管最近有頭條新聞稱德國提出的遠距醫療改革可能會限製成長，但我們在德國的銷售來自傳統藥房網路內的合作夥伴，我們目前沒有與任何遠距醫療平台合作。我們的藥房模式客戶和分銷商沒有受到現有患者的任何影響或乾擾。

I would also note that recent measures in Portugal to implement more stringent standards are also not impacting our business. We have been pleased to see more effective enforcement due to ensure product quality coming through this channel into Europe, which has contributed to our improving position as one of the world's premium providers of consistent and trusted sources of quality product.

我還要指出的是，葡萄牙最近實施的更嚴格標準的措施也沒有對我們的業務產生影響。我們很高興看到更有效的執法，以確保透過該管道進入歐洲的產品質量，這有助於我們作為全球優質產品穩定、值得信賴的供應商之一的地位不斷提高。

Operational integrity and adherence to import standards are core to our success internationally. And I'm pleased to also report that we -- past our recertification inspection in July for [GACP] and certification inspection against [revised fairly] medical cannabis good agricultural practice requirements. These are in addition to our EU GMP certification and will enable us to continue exporting bulk flower to Israel, and continue to provide additional GACP flower and GMP finished products to international customers.

經營誠信和遵守進口標準是我們在國際上成功的核心。我還很高興地報告，我們在 7 月通過了 [GACP] 重新認證檢查以及根據 [經過公平修訂的] 醫用大麻良好農業規範要求的認證檢查。這些都是我們歐盟 GMP 認證的補充，使我們能夠繼續向以色列出口散裝花卉，並繼續向國際客戶提供額外的 GACP 花卉和 GMP 成品。

We also benefit from our first quarter of recreational cannabis sales in the Netherlands, where we are seeing strong momentum as our Phase 1 facility has begun to reach its full operational capacity. We now have product in 66 of the 80 participating coffee shops, reflecting a market penetration of 82.5%, and we are consistently hearing that our flowers are earning preference with such consumers.

我們也受益於荷蘭第一季的休閒大麻銷售，隨著我們的第一階段設施開始達到其全部營運能力，我們看到了強勁的發展勢頭。目前，我們的產品已在 80 家參與活動的咖啡店中的 66 家銷售，市場滲透率為 82.5%，而且我們不斷聽說我們的鮮花越來越受到這些消費者的青睞。

The Holland market will be an incredibly exciting one for the company, where new opportunities will emerge. The [realms] of product innovation and consumer experience in coffee shops with a rich history of legacy in the cannabis industry. We are pleased to have the opportunity to participate in this dynamic market and look forward to launching additional products during the second half of the year, beginning with the launch of our hash offerings during the third quarter.

荷蘭市場對該公司來說將是一個令人難以置信的令人興奮的市場，這裡將會出現新的機會。大麻產業有著悠久歷史的咖啡店的產品創新和消費者體驗領域。我們很高興有機會參與這個充滿活力的市場，並期待在今年下半年推出更多產品，從第三季推出我們的雜湊產品開始。

We are also making steady progress on our state-of-the-art Phase 2 facility in the Netherlands, which we expect to be operational during the first quarter of next year, and will quadruple our annual production capacity, helping drive continued profitability growth in '26 and beyond. We'd like to thank all of our global business partners with the continued trust and support of Village Farms. We are looking forward to continued success together in the years ahead.

我們位於荷蘭的最先進的第二期工廠也在穩步推進，預計該工廠將於明年第一季投入運營，並將使我們的年生產能力翻兩番，有助於推動 26 年及以後的持續盈利增長。我們要感謝所有全球業務合作夥伴對 Village Farms 的持續信任和支持。我們期待在未來的歲月裡繼續共同取得成功。

So given the improving performance of our business, increasing demand in Canada, and from international partners, our strong cash position, we announced last week that our Board of Directors has unanimously approved the conversion of the remaining 550,000 square feet of our Delta 2 greenhouse in British Columbia to cannabis cultivation.

因此，鑑於我們業務表現的不斷提高、加拿大和國際合作夥伴的需求不斷增加以及我們強大的現金狀況，我們上周宣布，董事會一致批准將位於不列顛哥倫比亞省的 Delta 2 溫室剩餘的 550,000 平方英尺面積改為大麻種植。

This equates to about 40 additional metric tons of annual production once fully ramped. And as we always have, we will continue to prudently monitor demand as we onboard new supply, and carefully match our allocation of inventory with profitable sales.

一旦全面投入生產，這相當於每年額外增加約 40 公噸的產量。像往常一樣，我們將繼續在引入新供應的同時謹慎地監控需求，並仔細地將庫存分配與盈利銷售相匹配。

Physical conversion is expected to begin in November this year, with the first planning of new grow rooms expected this coming spring. The additional capacity will come online in phases with a target for the full 550,000 square feet to be in full production by the first quarter of 2027. The total investment for this expansion project is expected to be approximately CAD10 million, and will be funded through cash on hand and ongoing operational cash flows, and will be incurred mainly in 2026.

預計實體轉換將於今年 11 月開始，新的種植室的首次規劃預計將於今年春天進行。新增產能將分階段投入使用，目標是到 2027 年第一季全面投入 550,000 平方英尺的生產能力。此次擴建工程總投資預計約1,000萬加元，將透過庫存現金及持續經營現金流提供資金，主要將於2026年發生。

Given the improving profitability profile of our business, and our visibility into continued strength of demand from our international partners, as well as improving supply and demand dynamics in Canada, we believe this expansion will provide a substantial return on our investment.

鑑於我們業務獲利狀況的不斷改善，以及我們對國際合作夥伴持續強勁的需求的了解，以及加拿大供需動態的改善，我們相信此次擴張將為我們的投資帶來可觀的回報。

In stark contrast to the majority of our peers, our team has a proven track record of consistently matching our supply with demand from both our Canadian and international customers. And given our prudent and disciplined approach to CapEx, there is [no] clear indication of our confidence in the future of our cannabis business than our decision to make this investment.

與大多數同行形成鮮明對比的是，我們的團隊擁有良好的業績記錄，能夠始終如一地滿足加拿大和國際客戶的需求。鑑於我們對資本支出採取審慎而嚴謹的態度，沒有什麼比我們做出這項投資的決定更能表明我們對大麻業務未來的信心。

We have always taken a crawl, walk, run approach to scaling our business. Our facilities and grow rooms have been designed to vary production capacity relatively quickly. We have also always enjoyed a strategic advantage of already owning our advanced greenhouse assets in the United States and Canada through our legacy in the produce business. This has helped us be more efficient with our capital than many operators who build their facilities from scratch.

我們始終採取爬行、行走、奔跑的方式來擴展我們的業務。我們的設施和種植室的設計旨在相對快速地改變生產能力。憑藉我們在農產品業務方面的經驗，我們也一直享有在美國和加拿大擁有先進溫室資產的戰略優勢。與許多從頭開始建造設施的營運商相比，這有助於我們更有效地利用資金。

And we've also benefited from having an existing labor force in our greenhouses, which has been another important strategic advantage that limits execution risk when we convert additional growing space to cannabis.

而且，我們也受益於溫室中現有的勞動力，這是另一個重要的戰略優勢，當我們將額外的種植空間轉換為大麻時，它可以限制執行風險。

So in summary, we are growing organically, profitably, and generating positive free cash flow, and the strength of our balance sheet and asset portfolio is enabling us to make additional growth investments that we believe will drive strong returns for shareholders.

總而言之，我們正在實現有機成長、獲利成長並產生正的自由現金流，而我們資產負債表和資產組合的強勁使我們能夠進行額外的成長投資，我們相信這將為股東帶來豐厚的回報。

So this concludes my initial prepared remarks, and I'll turn the call over to Steve to review financials before I make some closing remarks. Steve?

這就是我最初準備好的發言，在做結束語之前，我會將電話轉給史蒂夫來審查財務狀況。史蒂夫？

Thanks, Mike. With the produce privatization transaction closing on May 30, some of our produce assets were privatized and are now classified as discontinued operations. The reported financial results for comparative prior periods have been adjusted accordingly. Our ongoing investment in the new [Produce] partnership is recorded as an investment on our balance sheet, and the operational results of the Produce partnership are not included in our financial results.

謝謝，麥克。隨著 5 月 30 日農產品私有化交易的結束，我們的部分農產品資產已被私有化，目前被歸類為停止經營。已對比較前期報告的財務結果進行了相應調整。我們對新的 [Produce] 合作夥伴關係的持續投資在我們的資產負債表中記錄為一項投資，而 Produce 合作夥伴關係的經營成果不包括在我們的財務業績中。

We recorded a gain on the sale of these produce assets net of tax of $19.1 million during the quarter. Results from continuing operations are composed of our cannabis and clean energy businesses, neither of which changed following the transaction, as well as the results of our Canadian produce operations that we retained.

本季度，我們出售這些農產品資產的稅後收益為 1,910 萬美元。持續經營績效包括我們的大麻和清潔能源業務（交易後均未發生變化）以及我們保留的加拿大農產品業務的業績。

I'll start with a review of our consolidated results. Consolidated net sales increased 12% to $59.9 million, mainly due to growth in our Canadian cannabis segment, and the first full quarter of sales from our recreational cannabis sales in the Netherlands. The increase in sales was matched by improved profitability across all segments.

我將首先回顧我們的綜合業績。合併淨銷售額成長 12% 至 5,990 萬美元，主要得益於我們加拿大大麻部門的成長，以及我們在荷蘭的休閒大麻銷售的第一個完整季度的銷售額。銷售額的成長與所有部門獲利能力的提高一致。

On the continuing operations basis, net income improved to $19.9 million, or $0.09 per share, compared to a net loss of $16.6 million, or $0.15 per share in Q2 of last year. Consolidated adjusted EBITDA from continuing operations, excluding our gain on sale, was $17.1 million, compared with $2.9 million in Q2 of last year. Our adjusted EBITDA margin of 28.6% of sales, compared to 5.4% of sales in Q2 of last year, which, as Mike mentioned, is a record performance for the company.

以持續經營計算，淨收入增至 1,990 萬美元，即每股 0.09 美元，而去年第二季的淨虧損為 1,660 萬美元，即每股 0.15 美元。持續經營業務的合併調整後 EBITDA（不含銷售收益）為 1,710 萬美元，而去年第二季為 290 萬美元。我們的調整後 EBITDA 利潤率的 28.6%，而去年第二季的銷售額為 5.4%，正如 Mike 所提到的，這是公司創紀錄的業績。

Turning now to our cannabis businesses. I will start with our Canadian Cannabis segment, which I will discuss in Canadian dollars for comparative purposes. Total net sales were $51.4 million, or a 10% increase versus Q2 last year, driven mainly by the very strong growth in international sales, as we continue to take share in these growing markets with increased sales from existing customers, as well as contributions from onboarding several new customers.

現在來談談我們的大麻生意。我將從加拿大大麻部分開始，為了進行比較，我將以加幣進行討論。總淨銷售額為 5,140 萬美元，較去年第二季增長 10%，主要得益於國際銷售額的強勁增長，因為我們繼續在這些不斷增長的市場中佔據份額，現有客戶的銷售額增加，以及幾個新客戶的加入做出的貢獻。

Export sales to our five international medicinal markets increased 690% from Q2 last year to $16.6 million, and are now roughly one-half the size of our retail branded sales net of excise tax. As Mike stated, we have hit our full-year target of tripling 2024 international export sales just halfway through the year.

我們五個國際醫藥市場的出口銷售額較去年第二季成長了 690%，達到 1,660 萬美元，目前約為我們零售品牌銷售額扣除消費稅後的一半。正如麥克所說，我們僅在今年年中就實現了 2024 年國際出口銷售額成長兩倍的全年目標。

With our focus on profitable sales, our Canadian retail branded sales were 20% lower than Q2 last year at $34.5 million. However, with an improved gross margin, as we have realigned our SKU portfolio towards higher-margin opportunities. Canadian cannabis gross margin was 39%, up from 26% in Q2 last year, and at the high end of our target range of 30% to 40%, which provides clear evidence of success in both growing higher-margin international export sales, and our focus on higher-margin products in Canada.

由於我們專注於獲利性銷售，我們的加拿大零售品牌銷售額比去年第二季下降了 20%，為 3,450 萬美元。然而，由於我們重新調整了 SKU 組合，以獲得更高利潤的機會，毛利率有所提高。加拿大大麻毛利率為 39%，高於去年第二季的 26%，處於我們 30% 至 40% 的目標範圍的高端，這清楚地證明了我們在增加高利潤國際出口銷售額和專注於加拿大高利潤產品方面取得了成功。

Our success in expanding gross margin, combined with a small year-over-year decrease in SG&A expenses drove significant improvements in the profitability of our Canadian cannabis segment. SG&A expense as a percentage of sales was 19%, compared to 22% last year, primarily due to continuing efficiencies throughout our Canadian cannabis operations.

我們成功擴大了毛利率，加上銷售、一般及行政費用同比小幅下降，推動了我們加拿大大麻部門盈利能力的顯著提高。銷售、一般及行政費用佔銷售額的百分比為 19%，而去年為 22%，這主要歸因於我們整個加拿大大麻業務的持續效率提高。

Q2 adjusted EBITDA for Canadian cannabis improved 150% year-over-year to our strongest performance in six years at $16.5 million, resulting in an adjusted EBITDA margin of 27%, which was more than double the 12% last year. Cash flow from operations decreased 233%, [$18 million], our strongest quarter of operating cash flow since we expanded into Canadian cannabis in 2017.

加拿大大麻第二季調整後 EBITDA 年成長 150%，達到 1,650 萬美元，為六年來的最高業績，調整後 EBITDA 利潤率為 27%，是去年 12% 的兩倍多。經營現金流下降 233% [1,800 萬美元]，這是我們自 2017 年擴展到加拿大大麻領域以來最強勁的經營現金流季度。

Finally, as we do each quarter, I will highlight that in Q2, we paid Canadian excise taxes on retail branded sales of $20.5 million, nearly 40% of retail branded sales, and almost double our SG&A. I will note, however, that the lower retail branded sales in Q2 as compared to last year resulted in lower excise taxes, which also contributes to our stronger profitability.

最後，正如我們每個季度所做的那樣，我要強調的是，在第二季度，我們為零售品牌銷售額支付了 2,050 萬美元的加拿大消費稅，佔零售品牌銷售額的近 40%，幾乎是銷售、一般和行政費用的兩倍。不過，我要指出的是，與去年相比，第二季品牌零售額較低，導致消費稅降低，這也有助於提高我們的獲利能力。

Turning now to our recreational cannabis business in the Netherlands. Q2 saw our first full quarter of sales from our [Lely] Holland operations. Sales were $2.5 million and adjusted EBITDA was $1.2 million, which are firmly in line with our expectations. Our Phase 1 facility has now reached its full operational capacity, so we expect revenue performance from the Netherlands to be similar in Q3 and Q4, with similar profitability until the end of Q4, when we do expect to increase operating expenses ahead of the commencement of operations in the Phase 2 facility, which will be coming online during the first quarter.

現在來談談我們在荷蘭的休閒大麻業務。第二季是我們 [Lely] 荷蘭業務實現第一個完整季度的銷售。銷售額為 250 萬美元，調整後的 EBITDA 為 120 萬美元，完全符合我們的預期。我們的第一階段設施現已達到其全部營運能力，因此我們預計荷蘭的收入表現在第三季度和第四季度將相似，並且在第四季度末之前保持類似的盈利能力，屆時我們預計在第二階段設施開始運營之前會增加運營費用，該設施將於第一季上線。

Our US cannabis business, with Q2 sales of $3.8 million continues to reflect the impact of various state actions, trying to deal with the unregulated hemp products by restricting all intoxicating hemp-based products. We did, however, see gross margin improve year-over-year to 63%, which benefited from the internalization of our gummy production, resulting in a small positive adjusted EBITDA for the quarter.

我們的美國大麻業務第二季銷售額為 380 萬美元，繼續反映各州行動的影響，試圖透過限制所有令人陶醉的大麻產品來處理不受管制的大麻產品。然而，我們確實看到毛利率年增至 63%，這得益於我們軟糖生產的內部化，導致本季調整後的 EBITDA 略有正成長。

Having been successful in our efforts to stabilize this business within the regulatory headwinds, we are working on a number of initiatives to invigorate sales of our responsible GMP-produced natural hemp products. In our remaining produce segment, sales increased 2% to $8.6 million. Our produce operations Q2, and through the remainder of this year reflects contributions from our Delta 1 greenhouse, and half of our Delta 2 greenhouse. The Delta 2 greenhouse tomato crop will be [pulled] in November at the end of its life cycle to commence our conversion to canvas production for the entire Delta 2 facility.

在監管不利的情況下，我們成功穩定了這項業務，目前正在採取多項措施來促進我們負責任的 GMP 生產的天然大麻產品的銷售。在我們剩餘的農產品領域，銷售額成長了 2%，達到 860 萬美元。我們第二季以及今年剩餘時間的農產品營運反映了我們的 Delta 1 溫室和一半 Delta 2 溫室的貢獻。Delta 2 溫室番茄作物將於 11 月在其生命週期結束時被拔除，以開始將整個 Delta 2 設施轉換為帆布生產。

Net income from continuing produce operations improved to $4.3 million, from a loss of $1.3 million. And adjusted EBITDA from continuing produce operations (technical difficulty) [$6.4 million]. Both of those figures include a $4.3 million vendor settlement related to previous operating losses incurred by our continuing produce operations.

持續生產經營的淨收入從虧損 130 萬美元增至 430 萬美元。持續生產業務的調整後息稅折舊攤提前利潤（技術難度）[640 萬美元]。這兩個數字都包括與我們持續生產經營所產生的先前經營損失有關的 430 萬美元供應商和解金。

Our Canadian produce business is seasonal. Historically, the Delta produce assets report their highest revenue and EBITDA in the third quarter of each calendar year. We will continue to maintain our Permian Basin, Texas greenhouse, and while not operational at this time, it is reported as part of our continuing produce business segment.

我們的加拿大農產品業務具有季節性。從歷史上看，Delta 生產資產在每年的第三季報告其最高收入和 EBITDA。我們將繼續維護位於德克薩斯州二疊紀盆地的溫室，雖然目前尚未投入運營，但據報它是我們持續生產業務部門的一部分。

Turning to consolidated cash flows and the balance sheet. Total cash flow from operations was $22.3 million in the first six months of the year. Our free cash flow during the first 6 months, including all our CapEx and debt service payments was $12 million.

轉向合併現金流量和資產負債表。今年前六個月的營業活動現金流總額為 2,230 萬美元。我們前 6 個月的自由現金流（包括所有資本支出和債務償還支出）為 1,200 萬美元。

With the $40 million in proceeds from the privatization transaction, we ended Q2 with cash of $65 million, with a net cash position of $29 million. Our total debt at the end of Q2 was $39 million. But as noted in our 10-Q this morning, we paid down USD3 million of our term debt as part of our produce lenders approval terms for the privatization transaction in August.

加上私有化交易所得的 4,000 萬美元，我們在第二季結束時持有 6,500 萬美元現金，淨現金部位為 2,900 萬美元。我們第二季末的總債務為 3,900 萬美元。但正如我們今天早上的 10-Q 報告中所述，作為 8 月份私有化交易的產出貸款人批准條款的一部分，我們償還了 300 萬美元的定期債務。

During the quarter, we refinanced our cannabis loan, consolidating the three previous loans into a single credit facility with two existing lenders. The new facility has a variable rate, which is currently below 6%, which reflects a 250 basis point improvement over the previous [facilities], with additional improved financial covenants, and now matures in February 2028.

在本季度，我們對大麻貸款進行了再融資，將先前的三筆貸款合併為一筆來自兩家現有貸款機構的信貸安排。新貸款採用浮動利率，目前低於 6%，比先前的貸款提高了 250 個基點，並附帶進一步改善的財務契約，到期日為 2028 年 2 月。

In closing, our Q2 results demonstrate the improving earnings of our power of Village Farms, and our enhanced balance sheet liquidity easily supports our growth investments, beginning with our existing capacity expansion projects in both the Netherlands and Canada.

最後，我們的第二季業績表明，鄉村農場電力的利潤不斷提高，我們增強的資產負債表流動性可以輕鬆支持我們的成長投資，首先是我們在荷蘭和加拿大現有的產能擴張項目。

I'll now turn the call back to Mike.

我現在將電話轉回給麥克。

Thanks, Steve. So in my closing remarks. Once again, our Q2 results reflect an exciting beginning for Village as next chapter, which is one we believe we can generate significant value for our shareholders. For anyone listening to today's call may be new to our story, I'd like you to know that I am firmly aligned with our shareholders as I remain Village Farms founder and largest shareholder, and we are intensely focused on protecting and enhancing our shareholder interest.

謝謝，史蒂夫。在我的結束語中。再一次，我們的第二季業績反映了 Village 下一章令人興奮的開端，我們相信我們可以為股東創造巨大的價值。對於收聽今天電話會議的任何人來說，可能對我們的故事還不熟悉，我想讓你們知道，我與我們的股東堅定保持一致，因為我仍然是 Village Farms 的創始人和最大股東，我們非常注重保護和增強我們的股東利益。

We have been hypersensitive to dilution, and we moved mountains recently to avoid a reverse stock split and retain our compliance with NASDAQ's listing requirements. And by the way, we've done this twice in the last two years without any share consolidation, and now our future has never looked brighter.

我們對稀釋問題高度敏感，最近我們竭盡全力避免股票反向分割，並繼續遵守納斯達克的上市要求。順便說一句，過去兩年我們已經這樣做過兩次了，沒有任何股票合併，現在我們的前景從未如此光明。

I encourage anyone new to our story, or our industry, to take a look at our comparison of shares outstanding compared to our peers over the past several years. I think you'll find it pretty quickly that we take our fiduciary responsibility to our shareholders quite seriously.

我鼓勵任何新了解我們的故事或我們行業的人看看我們過去幾年與同行相比的流通股數。我想您很快就會發現，我們非常重視對股東的信託責任。

In closing, we have transformed our company into a powerful global cannabis platform with a proven team of cannabis leaders, and unmatched portfolio of assets, a track record of operational success steadily expanding exposure to both international medical and recreational markets, and the tremendous upside potential from our ownership position in our private equity-backed produce partnership, and expansive US-based greenhouse assets and operations.

最後，我們已將公司轉變為一個強大的全球大麻平台，擁有一支經驗豐富的大麻領導團隊、無與倫比的資產組合、成功的營運記錄，穩步擴大在國際醫療和娛樂市場的影響力，以及我們在私募股權支持的生產合作夥伴關係中的所有權地位以及廣泛的美國溫室資產和運營的巨大上升潛力。

While we are currently benefiting from multiple catalysts unlocking value for our stakeholders, but we also see significant potential for additional long-term value creation through these additional pathways to value creation, which provide investors with a unique upside potential in an investment opportunity. We have retained full control of Canadian greenhouse assets at Delta, British Columbia, as well as our Permian Basin facility, as well as optionality of one of our Marfa greenhouses, should future cannabis market optionality in the US, or the state of Texas occur.

雖然我們目前受益於多種催化劑為我們的利害關係人釋放價值，但我們也看到透過這些額外的價值創造途徑創造額外長期價值的巨大潛力，這為投資者提供了投資機會中獨特的上行潛力。我們保留了對位於不列顛哥倫比亞省三角洲的加拿大溫室資產以及我們的二疊紀盆地設施的完全控制權，並且如果未來美國或德克薩斯州出現大麻市場選擇權，我們還保留了對我們其中一座馬爾法溫室的選擇權。

We're excited about continued momentum in the US cannabis policy and look forward to having a larger role this market in the future, and optimistic that our track record as one of the longest tenured operators in the Texas agricultural industry, and the regulated cannabis industry, that we are positioned well to replicate our success in Canada, in the US in the future.

我們對美國大麻政策的持續發展勢頭感到興奮，並期待未來在這個市場上發揮更大的作用，並且對我們作為德克薩斯州農業行業和受監管的大麻行業中歷史最悠久的運營商之一的業績記錄感到樂觀，我們有能力在未來在加拿大和美國複製我們的成功。

Our retained greenhouse assets in United States and Canada represent a combined incremental 4.2 million square feet of owned advanced greenhouse assets for future expansion potential and cannabis. These critical strategic assets provide a clear runway for us to continue replicating our proven success in operating at scale globally, and considerable expansion capacity compared to our current 2.3 million square feet of operational capacity today.

我們在美國和加拿大保留的溫室資產總計增加了 420 萬平方英尺，擁有未來擴展潛力和大麻所需的先進溫室資產。這些關鍵的戰略資產為我們提供了清晰的跑道，使我們能夠繼續複製我們在全球規模運營方面的成功經驗，並且與我們目前 230 萬平方英尺的運營能力相比具有相當大的擴展能力。

Also, not to mention the fact that we are operating and growing this business without violating any federal regulations in the United States, and are already a NASDAQ-listed company that satisfies its tax obligations, and generates positive free cash flow and net income.

更不用說我們在沒有違反美國任何聯邦法規的情況下運營和發展這項業務，並且已經是一家滿足納稅義務並產生正自由現金流和淨收入的納斯達克上市公司。

Finally, I would like to take a moment to thank and congratulate our fantastic team members on their recent achievements and the progress they've continued to make to enable our success. None of this is possible without their determination and focus. We've assembled a world-class team of experts in all areas of our business, and right now, they are firing on all cylinders.

最後，我想花點時間感謝並祝賀我們出色的團隊成員最近的成就以及他們為實現我們的成功而不斷取得的進步。如果沒有他們的決心和專注，這一切都不可能實現。我們在各個業務領域都組建了一支世界一流的專家團隊，現在他們正全力以赴。

We are a global multicultural organization, with team members on the ground in the United States, Canada, and Europe, and servicing an increasingly complex global supply chain with a growing list of strong international partners. And we are all energized by the many upside opportunities that we see in front of us in virtually all aspects of our business.

我們是一家全球多元文化組織，團隊成員遍佈美國、加拿大和歐洲，並透過日益壯大的國際合作夥伴為日益複雜的全球供應鏈提供服務。我們業務的幾乎所有方面都存在著許多有利機遇，這讓我們都充滿活力。

We are proud to be part of an emerging, vibrant, global cannabis ecosystem, proud to be leveraging our 36 years in highly intensive technology-driven agriculture to become a partner of choice in the cannabis community, and proud to be in a leadership position that is enabling us to self-fund our first and our second state-of-the-art cultivation facilities in the Netherlands, as well as the additional 40 metric tons of annual cultivation capacity to serve our Canadian international customers.

我們很自豪能夠成為新興、充滿活力的全球大麻生態系統的一部分，很自豪能夠利用我們 36 年的高度密集型技術驅動型農業經驗成為大麻社區的首選合作夥伴，也很自豪能夠處於領導地位，使我們能夠自籌資金建設位於荷蘭的第一和第二個最先進的種植設施，以及額外的 40 公噸/年的種植能力，以客戶服務於我們的加拿大國際客戶服務。

Our improving fundamental financial performance from our existing operations, combined with the expansion of our cultivation capacity in Canada, and the completion of our Phase 2 facility in the Netherlands, positions Village with a clear pathway to continued revenue growth and margin expansion in the years ahead.

我們現有業務的基本財務表現不斷提高，加上我們在加拿大的種植能力不斷擴大，以及我們在荷蘭的第二階段設施的完工，使 Village 在未來幾年繼續實現收入增長和利潤率擴大的道路上走在了前面。

That concludes our prepared remarks. And operator, we'll turn it over to you for any questions.

我們的準備好的演講到此結束。接線員，如有任何問題，我們會將其轉交給您。

(Operator Instructions) Aaron Grey, Alliance Global Partners.

（操作員指示）Aaron Grey，Alliance Global Partners。

Hi, good morning.

嗨，早安。

Thank you for the questions and congrats on the strong quarter on all fronts. First question for me. I just want to speak to your decision to expand Delta 2 facility, obviously, speaks to your confidence in the market opportunities. So based on the quarter, obviously, it appears a lot of this was driven by potential international market opportunities.

感謝您的提問，並祝賀本季各方面表現強勁。我的第一個問題。我只是想談談你們擴大 Delta 2 設施的決定，顯然，這顯示了你們對市場機會的信心。因此，根據本季的數據，顯然這在很大程度上是由潛在的國際市場機會所推動的。

But if you could offer some more color in terms of what went into [decision]? I know it's something you've been thinking about for some time. So is it more so a combination of what you're seeing on the international markets also wanting to maintain where you hold within the Canadian market today? Is it more your branded sales versus B2B opportunities? And then maybe more broadly in terms of pricing expectations that you're seeing going forward for the next few years given [what coming] online until 2027 for a full ramp?

但如果你能提供更多細節，說明[決定]？我知道這是你一段時間以來一直在思考的事情。那麼，這是否更多的是您在國際市場上看到的情況，同時也希望維持目前在加拿大市場的地位？您的品牌銷售機會是否比 B2B 銷售機會更多？那麼，從更廣泛的角度來看，考慮到 2027 年之前全面上線的情況，您對未來幾年的定價預期如何？

Thank you.

謝謝。

Thanks, Aaron. Look, for one, it's a very low dollar investment for us. So we're not building new assets. Our business model was predicated on converting existing assets. So this is not like we're going out and building a new $100 million facility. This is a USD7 million investment. The asset is there, and we're just converting it to cannabis. So that risk and investment is fairly low for us.

謝謝，亞倫。首先，對我們來說這是一筆很低的投資。所以我們不會建設新的資產。我們的商業模式以轉換現有資產為前提。所以這並不像我們要出去建造一個價值 1 億美元的新設施。這是一項700萬美元的投資。資產就在那裡，我們只是將其轉化為大麻。因此，對我們來說，風險和投資相當低。

Secondly, the way we've designed our facilities, we have many, many separate grow rooms. So with that, we can alter the amount of capacity coming out. We can decrease grow rooms by 3, 4, 5. We can increase it. And we've demonstrated that we've always been prudent with matching supply with demand, unlike many others. And you've seen that oversupply in Canada, which is really from the smoke and mirror days of Canada back in 2019 and '20. We were never really caught up in that.

其次，我們設計設施的方式是，我們有許多獨立的種植室。這樣，我們就可以改變輸出容量的數量。我們可以將種植室的數量減少 3、4、5 個。我們可以增加它。我們已經證明，與許多其他公司不同，我們始終謹慎地匹配供應和需求。你已經看到了加拿大的供應過剩，這實際上是 2019 年和 2020 年加拿大的煙霧彈時代造成的。我們從未真正陷入其中。

So we're not really worried about it. There's always ebb and flow to supply and demand, and we can adjust accordingly. Right now, though, we're not fulfilling our commitments. We're probably leaving around $50 million of revenue on the table right now. So we have to manage our business and fulfill our customer needs. And we're not concerned with the risk of being in an oversupply position.

所以我們對此並不擔心。供給和需求總是有起有落，我們可以相應地進行調整。但目前我們還沒有履行我們的承諾。我們現在可能損失了大約 5,000 萬美元的收入。因此我們必須管理我們的業務並滿足客戶的需求。我們並不擔心供應過剩的風險。

That's really helpful color there. And on that front, I will switch to international for a bit. Really strong quarter there, coming in above your expectations, already hitting the mark for tripling for the year in the first half.

那顏色確實很有幫助。在這方面，我將稍微轉向國際化。這個季度的表現確實很強勁，超出了你的預期，上半年就已經達到了全年三倍的成長目標。

So maybe just some more color in terms of some of the strong drivers in 2Q for international. I think you mentioned Germany was a standout, also within the UK. And then for the back half (technical difficulties) I think you said 2H would roughly match 1H. So maybe sitting towards what you just alluded to in terms of having to allocate some products?

因此，也許只是對第二季度國際上一些強勁驅動因素的更多描述。我認為您曾提到德國表現突出，在英國也是如此。然後對於後半部分（技術難題），我認為您說 2H 大致與 1H 匹配。那麼也許就必須分配一些產品而言，您剛才提到了這一點？

Is that just your needs to maybe manage to why -- maybe it doesn't hold to the 2Q rate, but holds to the 1H rate in 2H? So just any comments on what drove 2Q, and the expectations for 2H for international?

這是否只是您的需要，也許可以解決為什麼——也許它不遵守第二季的利率，但在下半年遵守上半年的利率？那麼，對於推動第二季度發展的因素以及對下半年國際市場的預期，您有何評論？

Okay. I'm going to let Ann comment. Go ahead, Ann.

好的。我要讓安發表評論。繼續吧，安。

So I think we did purposely say Germany and UK and onboarding new customers has been the driver. We're -- our growth aligns with where the growth of international markets is hottest. So we're there, and the team has done a great job of working very closely with some trusted distributor partners that we've been working with for some time. And I think it's also important that Canada is really leading this initiative, Canadian LPs, and we're proud to be part of that group.

所以我認為我們確實有意說德國和英國，而吸引新客戶一直是推動力。我們的成長與國際市場最熱門的成長保持一致。所以我們就在那裡，團隊與一些我們已經合作了一段時間的值得信賴的經銷商合作夥伴進行了非常密切的合作，做得非常出色。我認為同樣重要的是加拿大真正領導這項倡議，加拿大 LP，我們很自豪能成為這個團體的一部分。

Your second question with respect to outlook. We are geared up for continued growth. iwe're not going to guide as to what it's going to be. We were obviously off on our first half guidance. But the one thing I would just say is, it's an area where a lot of folks are getting involved. And so we're going to continue to participate in the growth of the market, and there will be others that we know are adding capacity to be there with us. So that's important.

您的第二個問題與展望有關。我們已為持續成長做好了準備。我們不會預測未來會是什麼樣子。我們上半年的期望顯然沒有實現。但我想說的是，這是一個很多人都參與的領域。因此，我們將繼續參與市場的成長，我們知道會有其他人增加產能來與我們一起發展。所以這很重要。

And then concurrently, we'll continue to support our retail partners in Canada. That's a critical and very much an important channel for us as well.

同時，我們將繼續支持我們在加拿大的零售合作夥伴。對我們來說，這也是一個至關重要的管道。

Okay, I really appreciate the color there. I'll jump back into the queue. Congrats to you on the quarter.

好的，我真的很欣賞那裡的顏色。我將重新回到隊列中。恭喜您本季取得的成績。

Doug Cooper, Beacon Securities.

道格·庫珀（Doug Cooper），Beacon Securities。

Good morning, everybody, and terrific work on the quarter. Steve, or Mike, I just want to confirm the numbers by segment, if I could. So Canadian cannabis, [USD11.9 million EBITDA], let's call it US cannabis small positive. The Netherlands, USD1.2 million, that gets me [$13.1 million]. You now [17.1] of EBITDA.

大家早安，祝您本季工作順利。史蒂夫，或者麥克，如果可以的話，我只想按部分確認數字。因此，加拿大大麻 [EBITDA 1190 萬美元]，我們稱之為美國大麻小幅上漲。荷蘭，120萬美元，這讓我很感動[1310萬美元]。您現在的 EBITDA 為 [17.1]。

So I guess the question is -- what was it, vendor settlement, $4.3 million. Would -- do I exclude that? I'm assuming I exclude that on an ongoing basis, so that would imply EBITDA from the produce sector in Canada was $2.1 million?

所以我想問題是——它是多少，供應商結算價，430 萬美元。我會排除這一點嗎？我假設我會持續排除這一點，那麼這是否意味著加拿大農產品產業的 EBITDA 為 210 萬美元？

Well, the adjusted EBITDA from continuing operations (technical difficulties) was $6.4 million, and it includes the $4.3 million. Because the (technical difficulties) was [higher] losses (technical difficulties) continuing [asset]. All of our greenhouses experienced the (technical difficulties), and this settlement pertain to the assets that we've retained.

嗯，持續經營（技術困難）的調整後 EBITDA 為 640 萬美元，其中包括 430 萬美元。由於（技術困難）損失（技術困難）持續增加[資產]。我們所有的溫室都遇到了（技術困難），這項和解與我們保留的資產有關。

But that's nonrecurring, correct?

但這是不會再發生的，對嗎？

It's nonrecurring, but I also said that these assets that we've retained generally have their highest revenue and highest EBITDA in the third quarter.

這是非經常性的，但我也說過，我們保留的這些資產通常在第三季收入最高，EBITDA 也最高。

Right. Okay. So Just in -- maybe you can just, in general, then, if we're looking to model the company out, it just has -- going forward is just going to be [D1] essentially, right? So on an annual basis, do you expect that to be --

正確的。好的。所以剛剛說 — — 也許你可以只是，總的來說，如果我們想要模擬公司，那麼 — — 未來基本上就是 [D1]，對吧？那麼，按年來看，你預計--

In 2026, yeah. For 2025, D2 is a contributor to a positive EBITDA contributor to our business.

是的，2026 年。到 2025 年，D2 將為我們的業務帶來正面的 EBITDA 貢獻。

Yeah, I'm just thinking about 2026. So 2026 and beyond, this is a net income positive business on an annual basis, correct?

是的，我只是在考慮 2026 年。那麼從 2026 年起，這是一個按年淨收入為正的業務，對嗎？

Yeah. Every year (technical difficulties) gross year.

是的。每年（技術難度）總年數。

And as well the $9.9 million of profit, that's pretax, correct?

還有 990 萬美元的利潤，這是稅前利潤，對嗎？

Yeah.

是的。

Okay. And that also includes the settlement gain, correct?

好的。這也包括結算收益，對嗎？

Yeah.

是的。

Okay. I just want to touch on maybe just what Aaron talked about, just in the Canadian cannabis market. We've seen a number of your competitors continue to report revenue down year-over-year in the Canadian cannabis [rec] market.

好的。我只是想談談 Aaron 所談論的加拿大大麻市場。我們發現，你們的許多競爭對手在加拿大大麻市場的收入較去年同期持續下降。

Who's left? And maybe that speaks to, Mike, your positive supply-demand dynamics that you referred to?

還有誰？麥克，這也許說明了您所提到的積極的供需動態？

Well, Doug, my mom always said if you can't say anything good, don't say anything at all. So I'd rather not talk about our competitors.

嗯，道格，我媽總是說，如果你不能說什麼好話，那就什麼都不要說。所以我不想談論我們的競爭對手。

Okay. Maybe just a comment about the dynamics, how the Canadian rec market dynamics look right now? Like the $40 million of excess?

好的。也許只是對動態的評論，加拿大娛樂市場動態現在如何？例如那 4000 萬美元的超額部分？

I'll let Ann talk.

我讓安來講。

I'll help you out here, Doug. Funny enough, even though we've seen pricing strengthen in the wholesale markets for well over a year now, we're only seeing it stabilize, which is good news in the Canadian retail environment. But we're not yet seeing pricing at the retail market level, which tells us there's still plenty of supply, or suppliers, to the market who are probably trying to take cash proceeds out, or take market share.

我會幫助你的，道格。有趣的是，儘管我們已經看到批發市場的價格在一年多的時間內持續走強，但我們只看到它趨於穩定，這對加拿大零售環境來說是個好消息。但我們尚未看到零售市場層面的定價，這表明市場上仍有大量供應或供應商，他們可能正試圖獲取現金收益或搶佔市場份額。

I think it is fair, though, that among those that are reporting, you are seeing improving profitability. You're seeing folks focus on the portfolio and where they're making profits versus not. And I think that's to use an [adage], you're starting to see the cream rise to the top within the Canadian producers.

不過，我認為公平的是，在那些報告的公司中，獲利能力正在提高。您會看到人們關注投資組合以及他們在哪裡盈利或不盈利。我認為，正如一句諺語所說，你開始看到加拿大生產商中的精英脫穎而出。

So I think there's a lot of good players that we respect. We love having that group with us in the market. And I think if we can just start to see some normal market dynamics, supply demand, and price response, I think that will be a positive. And I think that's important as Canada continues to lead the global market.

所以我認為有很多我們尊敬的優秀球員。我們很高興有這個團隊與我們一起進入市場。我認為，如果我們能夠開始看到一些正常的市場動態、供需和價格反應，我認為這將是一件積極的事情。我認為這很重要，因為加拿大繼續引領全球市場。

Okay. Just as we look forward into 2026 or 2027, international sales as a percentage of total cannabis -- Canadian cannabis revenue. Would you think it looks somewhat similar to what you just reported in Q2? Or what do you think the SKU is not included in the Netherlands business?

好的。正如我們展望 2026 年或 2027 年，國際銷售額佔大麻總銷售額的百分比——加拿大大麻收入。您是否認為它看起來與您在第二季報告的內容有些相似？還是您認為荷蘭業務不包含哪些SKU？

I would say, easiest bet is to say it could be where it is. The challenge is that the growth is still a little bit hotter overseas than in Canada. So keeping pace with market growth, or exceeding it, would mean you'd kind of have a similar mix in 2027.

我想說，最簡單的答案就是它可能就在它現在的位置。挑戰在於海外的成長速度仍然比加拿大略快一些。因此，跟上市場成長的步伐，或超越它，意味著你在 2027 年會擁有類似的組合。

If I can add some color. I mean you have to, at some point, Canadian LPs have to be profitable. I mean the day is going to come and you're measuring fundamentals, and you just can't keep raising capital and continuing to fund operations. Like any other normal business, you have to be profitable at some point.

如果我可以添加一些顏色。我的意思是，在某個時候，加拿大 LP 必須獲利。我的意思是，那一天即將到來，你正在衡量基本面，而你不能繼續籌集資金並繼續為營運提供資金。與任何其他正常業務一樣，您必須在某個時候獲利。

So the question is how long can they go continuing with ATMs and so on to continue to flourish, or continue to exist, I should say? So who knows what the next couple of years, the dynamics will be in Canada. We'll have to wait and see.

所以問題是，他們還能繼續使用 ATM 等設備多久，繼續繁榮多久，或者說繼續存在多久？所以誰知道未來幾年加拿大的動態會如何。我們只能拭目以待。

Okay. Just on the balance sheet, obviously, a tremendous improvement there. Are you seeing any M&A opportunities, whether it be in the Netherlands or Canada?

好的。光是在資產負債表上，顯然就有了巨大的改善。您是否看到任何併購機會，無論是在荷蘭還是加拿大？

Well, we -- first of all, we are so proud that we are predominantly growing organically. We always have everything we're doing on the international markets, we've done organically. We haven't purchased any companies to get where we are in international today. Because I think it's easy for companies to purchase a company and then spend a huge amount on M&A and then be able to say, well, I'm number-one market share, or I have these revenues. We don't do that.

嗯，首先，我們非常自豪，因為我們主要實現有機成長。我們在國際市場上所做的一切都是有機進行的。我們並沒有收購任何公司來實現我們今天在國際上的地位。因為我認為公司很容易收購一家公司，然後花費巨額資金進行併購，然後就可以說，好吧，我的市場份額第一，或者我有這些收入。我們不這麼做。

But that's not to say that M&A isn't on our list, and it would have to be very accretive or very strategic. And so far, we continue to not see that happening. I think we're the partner of choice for a lot of the European companies we're working with. So M&A is not off the table.

但這並不是說併購不在我們的考慮範圍內，併購必須具有很高的增值性或非常具有策略性。到目前為止，我們還沒有看到這種情況發生。我認為我們是許多與我們合作的歐洲公司的首選合作夥伴。因此併購並非不可能。

Certainly, in the Netherlands. If we look at the US, I think M&A will play a role in the US when and if we can enter that market. But right now in Canada, unless there's a very strategic reason tied to maybe technology or something else. I just don't see us looking at that in the near term.

當然，在荷蘭。如果我們看看美國，我認為如果我們能夠進入美國市場，併購將發揮作用。但目前在加拿大，除非有與技術或其他因素相關的戰略原因。我只是不認為我們會在短期內考慮這個問題。

Okay. Final one for me. Just on -- market looks to be up significantly this morning based on some reporting that (technical difficulties) is sort of returning to favor in the US administration. Thoughts on that and thoughts on what the implication is for your Texas greenhouse that didn't -- that remains in the portfolio?

好的。對我來說是最後一個。剛剛——根據一些報導（技術困難）正在重新受到美國政府的青睞，今天早上市場似乎大幅上漲。您對此有何看法？這對您未在投資組合中保留的德州溫室有何影響？

Well, look, the largest market in the world is the US, and I think everyone is feeling the momentum today. It's not if, it's just when. And we have worked very hard the last couple of years to continue to look at option A, B and C for our entry point to the US outside of what we're currently in, which is on the cannabinoid side because that is legal and accepted by the Nasdaq.

嗯，你看，世界上最大的市場是美國，我認為今天每個人都感受到了這種勢頭。這不是是否會發生的問題，而是何時發生的問題。過去幾年，我們一直在努力尋找 A、B 和 C 選項，作為我們目前進入美國的切入點，而大麻素領域是其中之一，因為大麻素是合法的，並且被納斯達克接受。

[Schedule 3] comes, I think it's a stepping stone to safe banking. I still believe that a lot of the US model is experimental. And what I mean by that is if it changes, and at some point, even in the state commerce, I think at that time, large scale, low cost, just like the winning [4 million Canada] and other places has to prevail. So I think there will be a change in the market.

[附表 3] 來了，我認為這是安全銀行業務的墊腳石。我仍然相信美國模式的內容很多都是實驗性的。我的意思是，如果情況發生變化，在某個時候，即使在州商業中，我認為到那時，大規模、低成本，就像獲勝的[400萬加拿大]和其他地方一樣必須佔上風。所以我認為市場將會改變。

Again, with our Texas assets, to go out and spend hundreds of millions of dollars to build the capacity, we currently have the optionality on, we're ready to go there, whether that's a stepping point in Texas. And Texas alone could be a very huge market as our entry point. And as I said earlier, M&A is on the table for the US market.

再說一次，憑藉我們在德克薩斯州的資產，我們可以花費數億美元來建立產能，我們目前擁有選擇權，我們已經準備好去那裡，無論這是否是德克薩斯州的一個跳板。僅德克薩斯州就可以成為我們切入點的一個非常巨大的市場。正如我之前所說，美國市場正在考慮進行併購。

But we -- the timing -- like we were very frustrated with the last administration making campaign promises and doing nothing. But on the other hand, the timing really worked out for us because it continued to strengthen our position in Canada as a top-tier player. And more importantly, it allowed us in those last few years to have a footprint in the first adult-use recreational market in Europe, which could be -- which we could leverage up that into other countries in the future, should they go [rec].

但我們——就時機而言——我們對上屆政府在競選中做出承諾卻無所作為感到非常沮喪。但另一方面，時機對我們來說確實很有利，因為它繼續鞏固了我們在加拿大的頂級地位。更重要的是，它讓我們在過去幾年在歐洲第一個成人娛樂市場佔有一席之地，如果其他國家也加入進來，那麼我們可以利用這一點。[錄製]。

Secondly, it allowed us to take a very commanding position in the international medicinal market, without being diluted on our US strategy. So that foundation is in place now. We just got to keep executing and building upon it. And the timing is actually better for us as the US looks to open up. So we feel, from a timing perspective, we're in a very good place.

其次，它使我們在國際醫藥市場上佔據了主導地位，同時又不削弱我們的美國戰略。現在這個基礎已經建立。我們只需繼續執行並在此基礎上繼續發展。隨著美國尋求開放，現在對我們來說時機實際上更好。因此，我們認為，從時機角度來看，我們處於一個非常好的位置。

And just to be clear, the US federal rescheduling, does that have to follow suit in Texas? Or can they somehow opt out of that?

需要明確的是，美國聯邦政府的重新安排是否也必須在德州實施？或者他們可以透過某種方式選擇退出？

Well, it's interesting. Texas has the Republic of Texas, that they do have a mandate that they have to follow federal guidelines. So it's been nebulous, for a lack of a better term, in Texas these days. But they do have to follow those guidelines. And there's going to be a lot of swinging going on till it stabilizes in the next couple of years. So Texas would have to follow that.

嗯，很有趣。德克薩斯州有德克薩斯共和國，他們確實有義務遵守聯邦指導方針。所以，最近德州的情況很模糊，找不到更好的詞來形容。但他們確實必須遵循這些準則。在未來幾年內，市場將會出現很大的波動，直到趨於穩定。因此德克薩斯州必須遵循這項規定。

And the other thing on (technical difficulties) as Medical, it could open up the doors for us to export medical marijuana from Canada to the United States, which is a whole another conduit that no one else is really thinking about right now. So we think we're in a good way. So -- but for Texas, we love Texas. We've been there, as I said in my remarks, 20 years. We'll see what happens with the [K-Cup] licensing here in the next month.

另一個關於醫療的技術難題是，它可以為我們打開從加拿大向美國出口醫用大麻的大門，這是目前沒有人真正考慮的另一個管道。所以我們認為我們的處境很好。所以——但是對於德克薩斯州，我們熱愛德克薩斯州。正如我在發言中所說，我們已經在那裡待了20年了。我們將在下個月看看這裡的[K-Cup]許可證會發生什麼情況。

So -- and we've always been patient. And I think that's one of the virtues of Village is, we're patient. We don't react to -- we know what the game rules are, what the regulations are. We just -- we're not here to waste money and have some costs. So yeah, I feel like we're in a good position via Texas or the US as a whole.

所以——我們一直都很有耐心。我認為這是 Village 的優點之一，我們很有耐心。我們不會做出反應——我們知道遊戲規則是什麼，規則是什麼。我們只是——我們來這裡不是為了浪費錢和承擔一些成本。所以是的，我覺得我們透過德州或整個美國處於有利地位。

(Operator Instructions) Frederico Gomes, ATB Capital Markets.

（操作員指示）Frederico Gomes，ATB 資本市場。

Congrats on the great quarter here. First question on your Canadian cannabis gross margins, very strong there. I guess, on the high end of your 30% to 40% range. But do you think there is upside to those margins considering what you're seeing in international? Could we be at a point here where we could see your target range moving above that 40% level?

恭喜本季取得如此出色的成績。第一個問題是關於加拿大大麻的毛利率，那裡的毛利率非常高。我猜，在 30% 到 40% 範圍的高端。但考慮到國際上的情況，您認為這些利潤率還有上升空間嗎？我們是否可以看到您的目標範圍突破 40% 的水平？

With the (technical difficulties) mix and the customer mix, it's possible (technical difficulties) some markets, we believe could be more lucrative like the UK. Again, that's -- in emerging markets, and we'll see, but that certainly is possible. We could be reporting prior numbers.

由於（技術困難）組合和客戶組合，我們認為某些市場（技術困難）可能會更有利可圖，例如英國。再說一次，這是在新興市場，我們會看到，但這肯定是可能的。我們可能會報告先前的數字。

I would also just say that as we add unit volume to our existing footprint that improves our cost base. And so you're seeing some of that in the margins as well. And the team on the ground has worked very hard on continuous improvement as well. So those are also contributing.

我還想說，當我們在現有佔地面積上增加單位體積時，我們的成本基礎就會得到改善。因此，您也會在邊緣看到一些這樣的情況。實地團隊也為持續改善付出了巨大的努力。所以這些也都有貢獻。

And just the last thing I would add is the price equation in some of our newer markets is still settling out. And so I think we're being prudent by just keeping this price -- this gross margin range as we know the story of Canadian cannabis price compression, and we're prepared for it.

最後我想補充的是，我們一些較新市場的價格方程式仍在穩定之中。因此，我認為我們保持這個價格——這個毛利率範圍是謹慎的，因為我們知道加拿大大麻價格壓縮的情況，我們已經準備好了。

Appreciate that. And then just talking about the growth, I guess, for the second half of this year. I guess just thinking that you're seeing more demand than you can supply at this point, which I think is a good problem to have. But in terms of drivers for growth in the second half, how should we think about that?

非常感謝。然後我想談談今年下半年的成長。我想你只是在想，目前你看到的需求超過了你能提供的供應，我認為這是一件好事。但對於下半年的成長動力，我們該如何思考呢？

Well, I think the second half, we feel -- we just don't want to get ahead of ourselves. That's the main thing. So we're basically saying that for the remainder of the year, we think we'll be tracking pretty similar. And with maybe the exception of [Lally], who is continuing to ramp up, as you know, we just got in production, we're approaching fully ramped up and diversifying the SKUs there.

嗯，我認為下半場，我們感覺——我們只是不想超越自己。這才是最重要的。所以我們基本上是說，在今年剩餘的時間裡，我們認為我們的追蹤情況將會非常相似。也許除了 [Lally] 還在繼續加大生產之外，正如你所知，我們剛開始生產，我們正在全面加大生產力度，並使那裡的 SKU 多樣化。

So we think we'll see continuous growth there. And coupled with quadrupling our capacity for next year. We see that as a strong ramp up internationally. But I think right now, we're pretty constrained for anything more than we've seen in the first half.

因此我們認為我們會看到那裡的持續成長。而明年我們的產能將增加四倍。我們認為這是國際上的強勁成長。但我認為，目前，我們受到的限制比上半年更大。

I would now like to turn the call back to Mike for closing remarks.

現在我想請麥克做最後發言。

Well, thanks, everyone, for participating today. We really appreciate listening to our second-quarter results. We are excited about the future and very much look forward to further communication and reporting our third quarter here in November. Thank you, operator.

好吧，謝謝大家今天的參與。我們非常高興聽到我們的第二季業績。我們對未來充滿期待，並非常期待在 11 月進一步溝通並報告我們的第三季業績。謝謝您，接線生。

This concludes today's conference call. Thank you for participating. You may now disconnect.

今天的電話會議到此結束。感謝您的參與。您現在可以斷開連線。