– Processing License Permits Pure Sunfarms
to Extract and Process Cannabis to Advance its Product Development
Strategy / Processing License One of Two Regulatory Steps Required
to Begin Sales to Provincial/Territorial and Private Retailers
–
VANCOUVER, May 20, 2019 /PRNewswire/ - Village Farms
International, Inc. ("Village Farms" or the "Company") (TSX:VFF;
NASDAQ:VFF) today announced that its 50%-owned joint venture for
large-scale, low-cost, high-quality cannabis production, Pure
Sunfarms, has received a Standard Processing License from Health
Canada for its 1.1 million square foot Delta 3 greenhouse facility
(the "Processing License").
The Processing License permits Pure Sunfarms to extract and
process cannabis at the Delta 3 facility, which will enable the
development and manufacture of products derived from the cannabis
plant, including cannabis oil, as well as concentrates and
edibles. Pure Sunfarms will require an additional amendment
to its sales license to sell cannabis oil, which it expects to be
distributing to provincial/territorial distributors and private
retailers by the fourth quarter of this year.
"Receipt of our Processing License is a critical step in the
execution of our product development strategy, allowing us to
expand beyond dried flower into the production of cannabis oil for
the current legal recreational market, as well as to develop a wide
range of products for the expected legalization in Canada of concentrates and edibles for
recreational use in October 2019,"
said Mandesh Dosanjh, President and Chief Executive Officer, Pure
Sunfarms. "Importantly, the Processing License permits Pure
Sunfarms to store cannabis oil on site at Delta 3, which will allow
us to purchase oil from external extractors for production of
concentrates and edibles ahead of having our own extraction
operations in place, which we continue to target for this
year."
The Processing License is one of two regulatory steps required
for Pure Sunfarms to begin selling directly to
provincially/territorially authorized distributors and private
retailers, with the other being an amendment to Pure Sunfarms'
existing sales license to permit the sale of dried products to
these retailers (sometimes referred to as a "packaging
license"). Pure Sunfarms continues to expect to receive the
requisite amendment to its sales license during the second quarter
of 2019.
"With its Processing License in hand and the amendment to its
sales license expected shortly, Pure Sunfarms should soon begin
selling its own branded packaged product directly to the Ontario
Cannabis Store under its existing supply agreement, as well as to
finalize supply agreements with other provincial boards and private
retailers," said Michael DeGiglio,
CEO, Village Farms International. "While spot market pricing
for sales to other licensed producers to date has been quite
favourable, direct sales to the provincial boards and private
retailers is expected to generate meaningfully higher margins, as
Pure Sunfarms' is reaching its full run-rate annual production of
75,000 kilograms at its Delta 3 facility mid-2019. Moreover,
with its existing supply relationship with another licensed
producer transitioning to improved terms at the end of this year,
Pure Sunfarms will have a significantly larger proportion of its
production available for sale to the provincial boards and private
retailers, with ongoing sales under that producer relationship
expected to generate higher margins due to a the change from fixed
to market pricing."
About Village Farms International, Inc.
Village Farms is one of the largest and longest-operating
vertically integrated greenhouse growers in North America and the only publicly traded
greenhouse produce company in Canada. Village Farms produces and distributes
fresh, premium-quality produce with consistency 365 days a year to
national grocers in the U.S. and Canada from more than nine million square feet
of Controlled Environment Agriculture (CEA) greenhouses in
British Columbia and Texas, as well as from its partner greenhouses
in British Columbia, Ontario and Mexico. The Company is now
leveraging its 30 years of experience as a vertically integrated
grower for the rapidly emerging global cannabis opportunity through
its 50% ownership of British
Columbia-based Pure Sunfarms Corp., one of the single
largest cannabis growing operations in the world. The Company
also intends to pursue opportunities to become a vertically
integrated leader in the U.S. hemp-derived CBD market, subject to
compliance with all applicable U.S. federal and state laws.
Village Farms has established a joint venture, Village Fields Hemp,
for multi-state outdoor hemp cultivation and CBD extraction and
plans to pursue controlled environment hemp production at its
Texas greenhouse operations, which
total 5.7 million square feet of production area, subject to
legalization of hemp in Texas.
Cautionary Language
Certain statements contained in this press release constitute
forward-looking information within the meaning of applicable
securities laws ("forward-looking statements"). Forward-looking
statements may relate to the Company's future outlook or financial
position and anticipated events or results and may include
statements regarding the financial position, business strategy,
budgets, litigation, projected production, projected costs, capital
expenditures, financial results, taxes, plans and objectives of or
involving the Company. Particularly, statements regarding future
results, performance, achievements, prospects or opportunities for
the Company, Pure Sunfarms, Village Fields, the greenhouse
vegetable industry or the cannabis and hemp industries are
forward-looking statements. In some cases, forward-looking
information can be identified by such terms as "outlook", "may",
"might", "will", "could", "should", "would", "occur", "expect",
"plan", "anticipate", "believe", "intend", "estimate", "predict",
"potential", "continue", "likely", "schedule", "objectives", or the
negative or grammatical variation thereof or other similar
expressions concerning matters that are not historical facts.
Although the forward-looking statements contained in this press
release are based upon assumptions that management believes are
reasonable based on information currently available to management,
there can be no assurance that actual results will be consistent
with these forward-looking statements. Forward-looking statements
necessarily involve known and unknown risks and uncertainties, many
of which are beyond the Company's control, that may cause the
Company's or the industry's actual results, performance,
achievements, prospects and opportunities in future periods to
differ materially from those expressed or implied by such
forward-looking statements. These risks and uncertainties include,
among other things, the factors contained in the Company's filings
with U.S. and Canadian securities regulators, including as detailed
in the Company's annual information form and management's
discussion and analysis for the year-ended December 31, 2017.
When relying on forward-looking statements to make decisions,
the Company cautions readers not to place undue reliance on these
statements, as forward-looking statements involve significant risks
and uncertainties and should not be read as guarantees of future
results, performance, achievements, prospects and opportunities.
The forward-looking statements made in this press release only
relate to events or information as of the date on which the
statements are made in this press release. Except as required by
law, the Company undertakes no obligation to update or revise
publicly any forward-looking statements, whether as a result of new
information, future events or otherwise.
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SOURCE Village Farms International, Inc.