Exhibit 99.1

Village Farms International, Inc.

Condensed Consolidated Interim Financial Statements

Three Months Ended March 31, 2019 and 2018

(Unaudited)

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

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The accompanying notes are an integral part of these condensed consolidated interim financial statements.

3

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

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VILLAGE FARMS INTERNATIONAL, INC.

VILLAGE FARMS INTERNATIONAL, INC.

Notes to Condensed Consolidated Interim Financial Statements for the

Three Months Ended March 31, 2019 and 2018

(In thousands of United States dollars, except per share amounts and unless otherwise noted)

These changes were made in accordance with the applicable transitional provisions.

Amendments to IFRS 11, Joint Arrangements , and IAS 28, Investments in Associates and Joint Ventures establishes the criteria for accounting for joint ventures. Investments in joint ventures are accounted for using the equity method. The equity method involves recording the initial investment at cost and subsequently adjusting the carrying value of the investment for the proportionate share of the profit or loss, other comprehensive income or loss and any other changes in the joint venture’s net assets such as dividends. At each statement of financial position date, the Company will consider whether there is objective evidence that its investment in the joint venture is impaired. If there is such evidence of impairment, the Company will determine the amount of the impairment and a loss will be recorded in the condensed consolidated interim statement of income (loss) (“interim statement of income (loss)”). The adoption of the amendments to IFRS 11 did not have and impact on the Company’s interim financial statements.

IFRS 16, Leases , was issued in January 2016 to replace IAS 17, Leases , and related Interpretations. IFRS 16 establishes the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract, i.e. the customer (lessee) and the supplier (lessor) to increase transparency and comparability among organizations by requiring the recognition of right-of-use assets and lease liabilities on the balance sheet.

On January 1, 2019, the Company adopted IFRS 16 using the updated modified retrospective transition approach and did not restate prior periods. The Company’s classes of assets include land leases, building leases and equipment leases.

On adoption, the Company recognized lease liabilities in relation to leases which had previously been classified as ‘operating leases’ under the principles of IAS 17, Leases . These lease liabilities were measured at the present value of the remaining lease payments, discounted using the borrowing rate of the Company. The weighted average incremental borrowing rate applied to the lease liabilities on January 1, 2019 was 6.25%. These leases are included in right-of-use assets, short-term lease liabilities and long-term lease liabilities in our consolidated balance sheet. Right-of-use assets are amortized on a straight-line basis over the lease term.

For leases previously classified as finance leases the entity recognized the carrying amount of the lease asset and lease liability immediately before transition as the carrying amount of the right of use asset and the lease liability at the date of initial application.

Additionally, the Company has elected the short-term lease exception for all classes of assets, and does not apply the recognition requirements for leases of 12 months or less, and recognizes lease payments for short-term leases as expense either straight-line over the lease term or as incurred depending on whether the lease payments are fixed or variable. These elections are applied consistently for all leases.

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VILLAGE FARMS INTERNATIONAL, INC.

Notes to Condensed Consolidated Interim Financial Statements for the

Three Months Ended March 31, 2019 and 2018

(In thousands of United States dollars, except per share amounts and unless otherwise noted)

The recognized right-of-use assets relate to the following types of assets:

The cost of inventories recognized as expense and included in cost of sales for the three months ended March 31, 2019 amounted to $25,738 (2018 - $20,205). The biological asset adjustment reclassifies actual costs incurred for the biological asset from inventories to biological asset on the interim statements of financial position.

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Depreciation related to the greenhouse facilities and equipment is expensed in cost of sales. Land is the only item of property, plant and equipment that is stated at fair values. On March 31, 2019, Pure Sunfarms exercised its option to acquire the Delta 2 assets and operations. Delta 2 land was disposed of as part of that transaction (note 7). The revaluation surplus related to Delta 2 of $1.7 million, net of taxes, that was previously recorded as a component of equity, was reclassified and included as part of the gain on disposal of assets recorded in the interim statements of income (loss).

Pure Sunfarms Corp.

On June 6, 2017, the Company entered into an agreement to form Pure Sunfarms, a B.C. corporation, with Emerald Health Therapeutics Inc. (“Emerald”). The purpose of Pure Sunfarms is to produce, market and distribute cannabis in Canada. Village Farms has a 50% ownership interest in Pure Sunfarms in the form of common shares. The Company has concluded that the agreement constitutes a joint arrangement where joint control is shared with Emerald and therefore has accounted for Pure Sunfarms in accordance with IFRS 11 and IAS 28, using the equity method.

On July 5, 2018, the Company and Emerald Health Therapeutics Canada Inc. (a subsidiary of Emerald) (together, the “Shareholders”) entered into a Shareholder Loan Agreement (the “Loan Agreement”) with Pure Sunfarms, whereby, as at March 31, 2019, the Shareholders had each contributed CA$13,000 (US$10,082) the form of a demand loan to Pure Sunfarms. Effective January 1, 2019, the loan amounts bear simple interest at the rate of 6.2% per annum, calculated semi-annually. Interest will accrue and be payable upon demand being made by both Shareholders (see note 10).

On March 30, 2019, Pure Sunfarms exercised its option to utilize the Delta 2 assets and operations. The contribution of the assets has been accounted for as a disposal of the land, greenhouse facility and other assets in exchange for 25,000,000 common shares of Pure Sunfarms. This was a non-cash transaction, and it was estimated that the fair value of the land, building and other assets was CA$25 million (US$18.7 million) at the date of contribution. The Company recognized a gain of $13.6 million on the contribution of the fixed assets. The Company had previously recorded a fair value increase on the Delta 2 land being contributed (2016 - $2.0 million), which was recorded in accumulated other comprehensive income, net of taxes of $1.0 million. As a result of the contribution of the Delta 2 land, this amount has been recycled to the interim statements of income, and has been included in the gain noted above. As at March 31, 2019, the total investment in Pure Sunfarms of US$41.1 million is recorded in the interim statements of financial position. Final determination with respect to the transfer of the land, building and equipment will not be made until year end. As such, the investment and related gain on disposal of assets may be adjusted at year end.

The Company’s share of the joint venture consists of the following:

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VILLAGE FARMS INTERNATIONAL, INC.

Notes to Condensed Consolidated Interim Financial Statements for the

Three Months Ended March 31, 2019 and 2018

(In thousands of United States dollars, except per share amounts and unless otherwise noted)

Summarized financial information of Pure Sunfarms (in $000’s of CAD):

Village Fields Hemp USA LLC

On February 27, 2019, the Company entered into a joint venture with Nature Crisp, LLC (“Nature Crisp”) to form VF Hemp for the objective of outdoor cultivation of high percentage cannabidiol (“CBD”) hemp and CBD extraction in multiple states throughout the United States. VF Hemp is 65% owned by the Company and 35% owned by Nature Crisp. Under the terms of the VF Hemp Joint Venture Agreement, the Company will lend approximately US$15 million to VF Hemp for start-up costs and working capital. Capital investment for extraction capabilities is to be determined and dependent on future decisions with respect to the locations of hemp production and the extraction operations. The Company has concluded that the agreement constitutes a joint arrangement where joint control is shared with Nature Crisp and therefore has accounted for VF Hemp in accordance with IFRS 11 and IAS 28, using the equity method.

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VILLAGE FARMS INTERNATIONAL, INC.

Notes to Condensed Consolidated Interim Financial Statements for the

Three Months Ended March 31, 2019 and 2018

(In thousands of United States dollars, except per share amounts and unless otherwise noted)

On March 25, 2019, the Company entered into a Grid Loan Agreement (the “Grid Loan”) with VF Hemp, whereby, as at March 31, 2019, the Company had advanced $2,250 in the form of a grid loan to VF Hemp. The Grid Loan has a maturity date of March 25, 2022, and will bear simple interest at the rate of 8% per annum, calculated monthly (note 10).

The Company’s share of the joint venture consists of the following:

Summarized financial information of VF Hemp :

Reconciliation of net assets :

The Company has a Term Loan financing agreement with a Canadian creditor (“FCC Loan”). The non-revolving variable rate term loan has a maturity date of May 1, 2021 and a balance of $33,615 as at March 31, 2019. The outstanding balance is repayable by way of monthly installments of principal and interest based on an amortization period of 15 years, with the balance and any accrued interest to be paid in full on May 1, 2021. As at March 31, 2019, borrowings under the FCC Loan agreement are subject to an interest rate of 7.233% (December 31, 2018 – 7.082%) which is determined based on the Company’s Debt to EBITDA ratio and the applicable LIBOR rate.

The Company’s subsidiary VFCE has a loan agreement with a Canadian Chartered Bank that includes a non-revolving fixed rate loan of CA$3.0 million with a maturity date of June 2023 and fixed interest rate of 4.98%. As at March 31, 2019, the balance was US$1,262 (December 31, 2018—US$1,279). The loan agreement also includes an uncommitted, non-revolving credit facility for up to CA$300 to cover Letters of Guarantee issued by the bank on behalf of the Company, with a maximum term of

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VILLAGE FARMS INTERNATIONAL, INC.

Notes to Condensed Consolidated Interim Financial Statements for the

Three Months Ended March 31, 2019 and 2018

(In thousands of United States dollars, except per share amounts and unless otherwise noted)

365 days, renewable annually. The loan agreement also includes an uncommitted credit facility for up to CA$700 to support financing of certain capital expenditures. The Company received an initial advance of CA$250 in October 2017. Each advance is to be repaid on a five-year, straight-line amortization of principal, repaid in monthly installments of principal plus interest at an interest rate of CA$prime rate plus 200 basis points. As at March 31, 2019, the balance was US$134 (December 31, 2018—$138).

The Company has a line of credit agreement with a Canadian Chartered Bank (“Operating Loan”). The revolving Operating Loan has a line of credit up to CA$13,000 and variable interest rates with a maturity date on May 31, 2021 and is subject to margin requirements stipulated by the bank. As at March 31, 2019, US$5,000 was drawn on this facility (December 31, 2018—$2,000), which is available to a maximum of CA$13,000, less outstanding letters of credit totaling US$261 and CA$38.

The Company’s borrowings (“Credit Facilities”) are subject to certain positive and negative covenants. As at March 31, 2019 the Company was in compliance with all covenants on its Credit Facilities.

Accrued interest payable on the credit facilities and loans as at March 31, 2019 was $232 (December 31, 2018—$184) and these amounts are included in accrued liabilities in the interim statement of financial position.

As security for the FCC Loan, the Company has provided promissory notes, a first mortgage on the VFF-owned greenhouse properties (excluding the Delta 3 and Delta 2 greenhouse facilities), and general security agreements over its assets. In addition, the Company has provided full recourse guarantees and has granted security therein. The carrying value of the assets and securities pledged as collateral as at March 31, 2019 was $137,463 (December 31, 2018 – $114,544).

As security for the Operating Loan, the Company has provided promissory notes and a first priority security interest over its accounts receivable and inventory. In addition, the Company has granted full recourse guarantees and security therein. The carrying value of the assets pledged as collateral as at March 31, 2019 was $37,847 (December 31, 2018—$38,007).

The aggregate annual principal maturities of long-term debt for the next five years and thereafter are as follows:

Financial assets and liabilities are recognized on the interim statements of financial position at fair value in a hierarchy that is based on the significance of the inputs used in making the measurements. The levels in the hierarchy are:

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VILLAGE FARMS INTERNATIONAL, INC.

Notes to Condensed Consolidated Interim Financial Statements for the

Three Months Ended March 31, 2019 and 2018

(In thousands of United States dollars, except per share amounts and unless otherwise noted)

As at March 31, 2019 and December 31, 2018, the Company’s financial instruments included cash and cash equivalents, trade receivables, notes receivable, other receivables, patronage stock, accounts payable, other current liabilities and notes payable. Due to the short-term maturities of cash and cash equivalents, accounts receivable, accounts payable and other current liabilities, the carrying amounts approximate fair value at the respective statement of financial position sheet dates. The carrying value of the notes receivable and notes payable approximate their fair value based on a comparison with the prevailing market interest rates. The fair values of the Company’s notes receivable and notes payable are level 2 measurements in the fair value hierarchy. All other financial assets and liabilities are level 1. None were classified as level 3.

There were no financial instruments categorized as Level 3 as at March 31, 2019 and December 31, 2018. There were no transfers of assets or liabilities between levels during the three and twelve months ended March 31, 2019 and December 31, 2018, respectively.

Interest income, expense and gains and losses from loans, receivables and other financial liabilities are recognized in the interim statements of income (loss). The following table summarizes interest income and expense for the three months ended March 31:

Management of financial risks

The Company, through its financial assets and liabilities, is exposed to various risks. The following provides a measurement of some of these risks as at March 31, 2019 and December 31, 2018. The Company uses financial instruments only for risk management purposes, not for generating trading profit.

Credit risk is the risk that the Company will incur a loss due to the failure by its customers or other parties to meet their contractual obligations. Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents, trade receivables and other receivables. The Company limits its exposure to credit risk by placing its cash and cash equivalents with high credit quality financial institutions.

The Company’s trade receivables had three customers that represented more than 10% of the balance of trade receivables, representing 15.6%, 15.5% and 11.6% of the balance of trade receivables as at March 31, 2019 (December 31, 2018—two customer represented 13.8% and 11.5%). The Company believes that its expected credit losses are limited due to the protection afforded to the Company by the Perishable Agricultural Commodities Act (the “PACA”) for its sales in the United States, which represent the majority of the Company’s annual sales. The PACA protection gives a claim filed under the PACA first lien on all PACA assets (which include cash and trade receivables of the debtor).

As at March 31, 2019, the allowance for doubtful accounts balance was calculated based on the expected credit loss model and expected credit losses continues to be insignificant.

As at March 31, 2019, 91.1% (December 31, 2018 – 90.3%) of trade receivables were outstanding less than 30 days, 7.3% (December 31, 2018 – 8.3%) were outstanding for between 30 and 90 days and the remaining 1.6% (December 31, 2018 – 1.4%) were outstanding for more than 90 days. Trade receivables are considered past due based on the contract terms agreed to with a customer. Aged receivables that are past due are not considered impaired unless customer specific information indicates otherwise.

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is exposed to interest rate risk on its long-term debt, for which the interest rates charged fluctuate based on the 90-day LIBOR rate. If interest rates had been 50 basis points higher, the net income during the three months ended March 31, 2019 would have been lower by $43. This represents $43 in increased interest expense (2018—$54).

As at March 31, 2019, the Canadian/U.S. foreign exchange rate was CA$1.00 = US$0.7489 (December 31, 2018 – US$0.7336). Assuming that all other variables remain constant, an increase of $0.10 in the Canadian dollar would have the following impact on the ending balances of certain interim statements of financial position items at March 31, 2019 and December 31, 2018 with the net foreign exchange gain or loss directly impacting net income (loss).

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Liquidity risk is the risk that the Company will not be able to meet its obligations as they fall due. The following are the contractual maturities of financial liabilities as at March 31, 2019:

It is the Company’s intention to meet these obligations through the collection of current accounts receivable and cash from sales. If the current resources and cash generated from operations are insufficient to satisfy its obligations, the Company may seek to issue additional equity or to arrange debt or other financing. In addition, as at March 31, 2019, the Company has an operating credit facility of up to CA$13,000, of which US$5,000 was drawn as at March 31, 2019, less outstanding letters of credit totaling US$261 and CA$38.

On February 13, 2019, the Company announced that Pure Sunfarms had entered into a credit agreement with Bank of Montreal, as agent and lead lender, and Farm Credit Canada, as lender, in respect of a CA$20 million secured non-revolver term loan (the “Credit Facility”). The Credit Facility, which matures on February 7, 2022, is secured by the Delta 3 facility, and contains customary financial and restrictive covenants. The Company is not a party to the Credit Facility but has provided a limited guarantee in the amount of CA$10 million in connection with the Credit Facility.

As at March 31, 2019, the Company had amounts due from its joint venture, Pure Sunfarms, totaling $1,140 (December 31, 2018 - $1,079) primarily for consulting services and the reimbursement of expenses which occurred in the year. These amounts are non-interest bearing and due on demand. On July 5, 2018, the Shareholders entered into a Loan Agreement with Pure Sunfarms, whereby, as at March 31, 2019, the Shareholders had each contributed CA$13,000 (US$10,082) in the form of a demand loan to Pure Sunfarms. Effective January 1, 2019, the loan amounts bear simple interest at the rate of 6.2% per annum, calculated semi-annually. Interest is accrued and payable on demand being made by either Shareholder. Prior to January 1, 2019, the loan amount bore interest at the rate of 8.0%. These amounts are included in amounts due from joint venture in the interim statements of financial position.

On March 25, 2019, the Company entered into a Grid Loan Agreement (the “Grid Loan”) with VF Hemp, whereby, as at March 31, 2019, the Company had contributed $2,250 in the form a grid loan to VF Hemp. The Grid Loan has a maturity date of March 25, 2022, and will bear simple interest at the rate of 8% per annum, calculated monthly.

One of the Company’s employees is related to a member of the Company’s executive management team and received approximately $27 in salary and benefits during the three months ended March 31, 2019 (2018 - $27).

Included in other assets as at March 31, 2019 is a $62 (December 31, 2018 - $64) promissory note that represents the unpaid amount the Company advanced to an employee in connection with a relocation at the request of the Company.

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VILLAGE FARMS INTERNATIONAL, INC.

Notes to Condensed Consolidated Interim Financial Statements for the

Three Months Ended March 31, 2019 and 2018

(In thousands of United States dollars, except per share amounts and unless otherwise noted)

Income tax expense is recognized based on management’s best estimate of the weighted average annual income tax rate expected for the full financial year. The estimated average annual rate used for the three months ended March 31, 2019 was 16%, excluding the change in biological asset as reported on the interim statements of income (loss), and 25% for the three months ended March 31, 2018.

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VILLAGE FARMS INTERNATIONAL, INC.

Notes to Condensed Consolidated Interim Financial Statements for the

Three Months Ended March 31, 2019 and 2018

(In thousands of United States dollars, except per share amounts and unless otherwise noted)

The Company’s two reporting segments include the Produce business and the Energy business. The Produce business produces, markets, and sells the product group which consists of premium quality tomatoes, bell peppers and cucumbers. The Energy business produces power that it sells per a long-term contract to its one customer.

The Company’s primary operations are in the United States and Canada. Net sales by the countries in which its customers are located are as follows:

The Company’s property, plant and equipment, net of accumulated depreciation, and right-of-use assets are located as follows:

The depreciation and amortization charges for the three months ended March 31, 2019 in the Produce business were $1,703 (2018 - $1,578) and $228 (2018 - $223) in the Energy business.

Diluted income per share is calculated by adjusting the weighted average number of common shares outstanding to assume conversion of all dilutive potential common shares. The Company’s share options are potentially dilutive to common shares. A calculation is done to determine the number of shares that could have been acquired at fair value (determined as the average market share price of the Company’s shares for the year) based on the monetary value of the subscription rights attached to outstanding share options. The number of shares calculated above is compared with the number of shares that would have been issued assuming the exercise of the share options. If dilutive effect is less than zero, then issuance is anti-dilutive and is excluded from dilutive income per share calculation.

For the three months ended March 31, 2019, no options to purchase shares of the Company’s common stock were excluded from the diluted income per share computation. For the three months ended March 31, 2018, there were 2,132 options to purchase shares of the Company’s common stock that were excluded from the diluted income per share computation because the impact of the assumed exercise of such stock options would have been anti-dilutive.

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The Company has a share-based compensation plan. The maximum number of common shares that can be issued upon the exercise of options granted is equal to 10% of the aggregate number of common shares issued and outstanding from time to time. The term during which an option may be exercised is 10 years from the date of the grant. Options generally vest at a rate of 33% per year, beginning one year following the grant date of the options. Share-based compensation expense for the three months ended March 31, 2019 of $1,409 (2018 - $118) was recorded in selling, general and administrative expenses and the corresponding amount credited to contributed surplus.

During the three months ended March 31, 2019, 355,000 performance-based restricted share units were granted to Village Farms employees and directors involved with future developments of the Company. Once a performance target is met and the share units are deemed earned and vested, compensation expense based on the fair value of the share units on the grant date is recorded in selling, general and administrative expenses in the interim statements of income. There were 1,253,333 performance-based restricted share units outstanding as at March 31, 2019, of which 1,034,000 were not vested as at March 31, 2019.

In June 2017, as part of the formation of Pure Sunfarms, the Company issued 300,000 common share purchase warrants, valued at $148 (CA$192), to an affiliate of a Canadian financial institution (“warrants holder”) as partial consideration for services related to the joint venture agreement. In April 2019, the warrants holder exercised its warrant rights and subscribed for 300,000 shares of the Company’s common stock resulting in a contribution of CA$621,000.

In April 2019, the Company completed a bought deal offering of 1,000,000 common shares of the Company at an offering price of CA$20.00 per offered share for net aggregate proceeds to the Company of approximately CA$18,700,000.

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Exhibit 99.2

Village Farms International, Inc.

Management’s Discussion and Analysis

Three Months Ended March 31, 2019

May 9, 2019

Village Farms International, Inc.

Management’s Discussion and Analysis

Information is presented in thousands of United States dollars (“U.S. dollars”) unless otherwise noted.

Introduction

This management’s discussion and analysis (“MD&A”) should be read in conjunction with the condensed consolidated interim financial statements and accompanying notes of Village Farms International, Inc. (“VFF” and, together with its subsidiaries, the “Company”), for the three months ended March 31, 2019 (the “Interim Financial Statements”). The information provided in this MD&A is current to May 9, 2019 unless otherwise noted.

VFF is a corporation existing under the Canada Business Corporations Act . The Company’s principal operating subsidiaries as at March 31, 2019 were Village Farms Canada Limited Partnership (“VFCLP”), Village Farms, L.P. (“VFLP”) and VF Clean Energy, Inc. (“VFCE”). On June 6, 2017, VFF entered into a shareholders’ agreement in respect of the operation and governance of Pure Sunfarms Corp. (“Pure Sunfarms”) in which VFF owns a 50% interest. On February 27, 2019, VFF entered into a joint venture agreement in respect of the operation and governance of Village Fields Hemp USA LLC (“VFH”) in which VFF owns a 65% interest.

Basis of Presentation

The interim data included in the MD&A is based upon the Interim Financial Statements, which are prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”), as applicable to interim financial statements, including International Accounting Standard (“IAS”) 34, Interim Financial Reporting , unless otherwise noted.

The preparation of interim financial data requires the use of certain accounting estimates. It also requires management to exercise its judgment in the process of applying the Company’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the annual financial data, are disclosed in note 2 of the Condensed Consolidated Interim Financial Statements.

Segment Reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Chief Executive Officer of VFF (“CEO”). Based on the aggregation criteria in IFRS 8, Operating Segments , the operating segments of the Company are treated as two reporting segments.

Functional and Presentation Currency

The functional currency for each entity included in these consolidated financial statements is the currency of the primary economic environment in which the entity operates. These consolidated financial statements are presented in United States dollars (“U.S. dollars”) which have been rounded to the nearest thousands, except per share amounts. Currency conversion to U.S. dollars is performed in accordance with IAS 21, The Effects of Changes in Foreign Exchange Rates .

Business Overview

Management believes that the Company is one of the largest producers, marketers and distributors of premium-quality, greenhouse-grown tomatoes, bell peppers and cucumbers in North America. These premium products are grown in sophisticated, highly intensive agricultural greenhouse facilities located in British Columbia and Texas. The Company also markets and distributes premium tomatoes, peppers and cucumbers produced under exclusive arrangements with other greenhouse producers. The Company primarily markets and distributes under its Village Farms ^® brand name to retail supermarkets and dedicated fresh food distribution companies throughout the United States and Canada. It currently operates two distribution centres, one in the United States and one in Canada. Since its inception, the Company has been guided by a sustainable agriculture policy which integrates four main goals – environmental health, economic profitability, social equality and economic equality.

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Village Farms International, Inc.

The Company, through its subsidiary VFCE, owns and operates a 7.0 megawatt (“MW”) power plant from landfill gas that generates electricity and provides thermal heat, in colder months, to one of the Company’s adjacent British Columbia greenhouse facilities and sells electricity to the British Columbia Hydro and Power Authority (“BC Hydro”).

In June 2017, the Company entered into a joint venture with Emerald Health Therapeutics, Inc. (together with its affiliates, “Emerald”). The joint venture was formed by way of a corporation named “Pure Sunfarms Corp.”, a licensed producer and supplier of cannabis products to be sold to other licensed providers and provincial governments across Canada and internationally. On March 8, 2018, Pure Sunfarms was granted a cultivation license and on July 30, 2018 a sales license, both under the Access to Cannabis for Medical Purposes Regulations (“ACMPR”) by Health Canada (repealed October 17, 2018 and replaced by the Cannabis Act , S.C. 2018, c. 16). During 2017, the Company granted rights to one of its greenhouses located in Delta, BS (the “Delta 3 Greenhouse”). On March 8, 2019 Pure Sunfarms received its seventh amendment from Health Canada, which approved all 16 grow rooms for cultivation. On March 31, 2019, Pure Sunfarms exercised its option on the existing 1.1 million square foot Delta 2 greenhouse facility currently owned by VFF in Delta, British Columbia. The Delta 2 greenhouse facility is a nearly identical “sister” facility immediately adjacent to the 1.1 million square foot Delta 3 greenhouse facility. The addition of the Delta 2 greenhouse facility will double Pure Sunfarms’ total production area to 2.2 million square feet and, with conservatively targeted annual production of approximately 75,000 kilograms of dried cannabis, will double its annual cannabis production potential to approximately 150,000 kilograms.

In February 2019, the Company entered into a joint venture with Nature Crisp LLC (“Nature Crisp”). The joint venture was formed by way of a limited liability corporation named “Village Fields Hemp USA LLC” (“VF Hemp”) for the cultivation of high-cannabidiol (“CBD”) hemp and CBD extraction in multiple states throughout the United States.

The Company embraces sustainable agriculture and environmentally-friendly growing practices by:

The Company’s assets, as of the reporting date, include six operating produce greenhouses providing approximately 849,958 square metres (or approximately 210 acres) of growing space in Canada and the United States.

All of the Company’s greenhouses are constructed of glass, aluminum and steel, and are located on land owned or leased by the Company. The Company also has marketing agreements with growers in Canada, the United States and Mexico that currently operate approximately 808,000 square metres (or approximately 200 acres) of growing area.

The following table outlines the Company’s greenhouse facilities:

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Produce Marketing

The Company is a leading marketer of premium-quality, value-added, branded greenhouse-grown produce in North America, and is a significant producer of the following tomato types: tomatoes on-the-vine, beefsteak, cocktail, grape, cherry, roma, Mini San Marzano (a tomato variety for which the Company currently has an exclusive agreement with the seed provider to be the sole grower in North America), other speciality tomatoes under exclusive agreements and long English cucumbers at its facilities. The Company also distributes and markets premium tomatoes, bell peppers and cucumbers in the United States and Canada produced by other greenhouse growers located in Canada and Mexico. The Company maintains high standards of food safety and requires the same of its contract growers, while providing on-time, effective and efficient distribution.

The Company strives to continually exceed the expectations of its customers by consistently providing superior product, including adding new product varieties and packaging innovations.

The Company has distribution capabilities that it believes exceed those of most of its competitors in the North American greenhouse vegetable industry. With leased distribution centres in Texas and British Columbia, the Company provides its customers with flexibility in purchasing. For the three months ended March 31, 2019, the Company had an on-time delivery record of approximately 98.2%, while maintaining competitive freight rates that management of the Company believes to be among the best in the industry.

The Company’s marketing strategy is to strategically position the Company to be the supplier of choice for retailers offering greenhouse produce by focusing on the following:

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Village Farms International, Inc.

Investment in Joint Venture

On June 6, 2017, the Company and Emerald formed a new corporation named Pure Sunfarms Corp. (“Pure Sunfarms”). The Company and Emerald each own 50% of the equity in Pure Sunfarms. VFF contributed one of its 25-acre greenhouse facilities in Delta, British Columbia as its equity contribution and Emerald contributed CA$20,000,000 to fund the conversion of the facility, which was fully funded as of April 2018. Pure Sunfarms has commenced the cultivation of cannabis in the licensed portion of the facility and received its sales license for the facility on July 30, 2018 from Health Canada. Pure Sunfarms has commenced the selling and distribution of cannabis.

On July 5, 2018, the Company and Emerald (together, the “Shareholders”) entered into a Shareholder Loan Agreement (the “Loan Agreement”) with Pure Sunfarms, whereby, as at March 31, 2019 the Shareholders had each contributed CA$13,000 (US$10,082) in the form of a demand loan to Pure Sunfarms. Effective January 1, 2019, the loan amounts bear simple interest at the rate of 6.2% per annum, calculated semi-annually. Interest will accrue and be payable upon demand being made by either Shareholder. From inception until January 1, 2019 the loan amounts bore interest at the rate of 8%.

On March 30, 2019, Pure Sunfarms exercised its option on the existing 1.1 million square foot Delta 2 greenhouse facility currently owned by VFF in Delta, British Columbia. The Delta 2 greenhouse facility is a nearly identical “sister” facility immediately adjacent to the 1.1 million square foot Delta 3 greenhouse facility. The addition of the Delta 2 greenhouse facility will double Pure Sunfarms’ total production area to 2.2 million square feet and, with conservatively targeted annual production of approximately 75,000 kilograms of dried cannabis, will double its annual cannabis production potential to approximately 150,000 kilograms. Pure Sunfarms also expects to benefit from further economies of scale resulting from the concentration of 2.2 million square feet of production area at a single location, which will further support the Company’s goal to be the high-quality, low-cost cannabis producer in Canada. The existing automated propagation operation (nursery) in the Delta 3 greenhouse facility will serve the Delta 2 greenhouse facility, enabling more of the footprint of the Delta 2 greenhouse facility to be devoted to flower rooms than in the Delta 3 greenhouse facility, which is expected to generate further cost efficiencies.

Formation of VF Hemp USA, LLC.

On February 27, 2019, the Company entered into a joint venture with Nature Crisp to form VF Hemp, for the objective of outdoor cultivation of high percentage CBD hemp and CBD extraction in multiple states throughout the United States (the “VF Hemp Joint Venture Agreement”). VF Hemp is 65% owned by the Company and 35% owned by Nature Crisp. Under the terms of the VF Hemp Joint Venture Agreement, the Company is expecting to contribute approximately US$15 million to VF Hemp for start-up costs and working capital. Capital investment for extraction capabilities is to be determined and dependent on future decisions with respect to the locations of hemp production and the extraction operations.

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Results of Operations for the Three Months Ended March 31, 2019 compared to the Three Months Ended March 31, 2018

Sales

Sales for the three months ended March 31, 2019 increased by $2,400, or 8%, to $31,890 from $29,490 for the three months ended March 31, 2018. The increase in sales is primarily due to an increase in supply partner revenue of 34% (or 26% in product volume) partially offset by a decrease in the average selling price of tomatoes.

The average selling price for tomatoes decreased (5%) for the three months ended March 31, 2019 versus the three months ended March 31, 2018. Cucumber pricing decreased by (3%) and pepper pricing increased by 22% in the first quarter of 2019 versus the comparable quarter in 2018.    

Cost of Sales

Cost of sales for the three months ended March 31, 2019 increased by ($5,680), or (22%), to $31,582 from $25,902 for the three months ended March 31, 2018; primarily due to an increase of ($3,489) in contract sales cost (due to the increased volume) and an increase in cost per pound from the Texas facilities, which is due to production issues that caused decreases in production as well increases in labor costs. The decrease in production causes an increase in cost per pound as most costs are fixed and, as production decreases, cost per pound increases.

Selling, General and Administrative Expenses

Selling, general and administrative expenses for the three months ended March 31, 2019 increased by $668, or 20%, to $4,025 from $3,357 for the three months ended March, 31, 2018. The increase is due to accounting costs, legal fees and consulting fees all related to the Company’s growth initiatives involving its new crops in both Canada and United States, as well as its dual listing on the Nasdaq in February 2019.

Stock Compensation Expenses

Stock compensation expense for the three months ended March 31, 2019 and 2018 was $1,409 and $118, respectively. The incremental increase in stock compensation is directly related to first quarter 2019 developments in Pure Sunfarms.    

Change in Biological Asset

The net change in fair value of the biological asset was ($100) for the three months ended March 31, 2019 compared to ($659) for the three months ended March 31, 2018. The increase in the change in the biological asset was due to a lower starting value for the for the three months ended March 31, 2019 as compared to the three months ended March 31, 2018. The fair value of the biological asset as at March 31, 2019 was $5,170 as compared to $5,999 as at March 31, 2018 due to lower production in early April 2019 versus early April 2018.

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Village Farms International, Inc.

(Loss) from Operations

Loss from operations for the three months ended March 31, 2019 increased ($4,679) to ($5,225) from ($546) for the three months ended March 31, 2018. The decrease is due to an increase in cost of sales greater than the increase in sales as well as an increase in selling, general and administrative expense for three months ended March 31, 2019 versus the three months ended March 31, 2018.    

Interest Expense, net

Interest expense, net, for the three months ended March 31, 2019 increased by $9, to $607 from $598 for the three

months ended March 31, 2018. The increase is due to higher interest rates versus the prior year.    

Share of Income (Loss) from Joint Ventures

The Company’s share of income from its Pure Sunfarms joint venture for the three months ended March 31, 2019 was $4,268 compared to a loss of ($237) for the three months ended March 31, 2018. The increase is due to operations for the three months ended March 31, 2019 as compared to not having any production operations for the same period in 2018.

The Company’s share of loss from its VF Hemp joint venture for the three months ended March 31, 2019 was ($30) compared to $nil for the three months ended March 31, 2018. The loss primarily consists of salaries and other administrative costs in March 2019.

Provision for (Recovery of) Income Taxes

Provision for income taxes for the three months ended March 31, 2019 was $4,501 compared to ($213) for the three months ended March 31, 2018. The income tax provision increased due to deferred tax liabilities arising from the contribution of the Delta 2 assets to Pure Sunfarms.

Net Income (Loss)

Net income for the three months ended March 31, 2019 increased by $8,791 to $7,648 from ($1,143) for the three months ended March 31, 2018 primarily due to the gain on the disposal of assets, income from the Pure Sunfarms joint venture offset by an increase in the loss from operations and an increase in provision for income taxes.

EBITDA

EBITDA for the three months ended March 31, 2019 decreased by ($533) to $1,280 from $1,813 for the three months ended March 31, 2018. The decrease is due to a larger loss from operation due to an increase in the cost per pound for the tomatoes from the Texas facilities and incremental overhead expenses related to changes in the Company’s business operations including its recent listing on the Nasdaq. See the EBITDA calculation in “Non-IFRS Measures—Reconciliation of Net Income to EBITDA”.

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Village Farms International, Inc.

Non-IFRS Measures

References in this MD&A to “EBITDA” are to earnings before interest, taxes, depreciation, amortization, foreign currency exchange gains and losses on translation of long-term debt, unrealized gains on the changes in the value of derivative instruments, unrealized change in biological asset, stock compensation, and gains and losses on asset sales. EBITDA is a cash flow measure that is not recognized under IFRS and does not have a standardized meaning prescribed by IFRS. Therefore, EBITDA may not be comparable to similar measures presented by other issuers. Investors are cautioned that EBITDA should not be construed as an alternative to net income or loss determined in accordance with IFRS as an indicator of the Company’s performance or to cash flows from operating, investing and financing activities as measures of liquidity and cash flows. Management believes that EBITDA is an important measure in evaluating the historical performance of the Company.

The following table reflects a reconciliation of Share of income (loss) from joint ventures to EBITDA, as presented by the Company: