December 2015 Forward Looking Statements This presentation contains - - PowerPoint PPT Presentation

LD Micro Presentation December 2015

2

Forward Looking Statements

This presentation contains certain "forward looking statements". These statements relate to future events or future performance and reflect the Company's expectations regarding its growth, results of

• perations, performance, business prospects, opportunities or industry performance and trends.

These forward looking statements reflect the Company's current internal projections, expectations or beliefs and are based on information currently available to the Company. In some cases, forward looking statements can be identified by terminology such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "estimate", "predict" , "potential", "continue" or the negative of these terms or

• ther comparable terminology. A number of factors could cause actual events or results to differ

materially from the results discussed in the forward looking statements. In evaluating these statements, you should specifically consider various factors, including, but not limited to, such risks and uncertainties as availability of resource, competitive pressures and changes in market activity, risks associated with U.S. and Canadian sales and foreign exchange, regulatory requirements and all of the other "Risk Factors" set out in the Company's current annual information form and management's discussion and analysis for the year ended December 31, 2014, which is available electronically at www.sedar.com. Actual results may differ materially from any forward looking statement. Although the Company believes that the forward looking statements contained in this presentation are based upon reasonable assumptions, you cannot be assured that actual results will be consistent with these forward looking statements. These forward looking statements are made as

• f the date of this presentation, and other than as specifically required by applicable law, the

Company assumes no obligation to update or revise them to reflect new events or circumstances.

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Company Overview

• A leading greenhouse grower & marketer of branded,

high-quality hydroponically grown produce

• CPG company growing and selling fresh produce
• Vertically integrated year-round direct supplier to leading retail grocers
• Oldest greenhouse operation and brand in the U.S.
• Largest greenhouse operator in North America
• Strong reputation as industry leader in quality and food safety
• Exclusive rights to grow and market certain tomato varieties
• Highly Sustainable
• Responsible growing practices
• Highly productive compared to field farming - 30x
• “Local” source produce supplier
• Operating and marketing in Canada, US and Mexico
• Greenhouse facilities owned – 240 acres
• Exclusive marketing arrangements with US, MX and CA growers
• Stock Data on November 30, 2015
• Current Market Capitalization: US$25M
• Current Shares Outstanding: 38.8M
• Current Shares Diluted: 40.7 M
• 52 Week Hi/Lo: C$1.07 / $0.70
• Approx. Institutional Ownership: 25%
• Approx. Insider Ownership: 52%

4

Investor Considerations

Largest Hydroponic Greenhouse Producer in North America Diverse Base

• f National

Marquee Customers Proprietary Greenhouse Technology & Varieties Highly Experienced Management and Production Team High Barriers of Entry into Greenhouse Market Year Round Production Capabilities Strong Consumer Demand for Local, Sustainable Produces Strong Track Record for Food Safety

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Greenhouse Produce – A Premium Product

• Retail consumers pay a premium for Greenhouse produce
• Offers more consistent quality, taste, appearance and food safety than field grown produce
• Vine-Ripened Tomatoes
• Consistent quality
• Year-round production
• Multiple varieties
• Flavor fully develops/better taste
• Peppers
• Vibrant colors, firm skin
• Stems; green and fresh
• Sweet taste
• English Cucumbers
• Mini and Long
• Thin dark green skin
• Unwaxed/not coated
• Seedless

6

Exclusive Varietal Innovation & Development

0.5 18 28 44 5 10 15 20 25 30 35 40 45 50 2012 2013 2014 2015 VF Acres Year

Mini San Marzano Acres

One of three exclusive varieties

Marquee Customers

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Size of Retail Produce Markets

Top 21 US Produce Category Contribution to Department for 52 weeks Ending 09/26/15

Rank Product Dollars Volume Dollar Contribution to Department Dollars YAGO Volume YAGO Dollar Contribution to Department YAGO Dollars % Change vs YAGO Volume % Change vs YAGO Dollar Contribution to Department Change vs YAGO Produce $46,454,638,038 31,496,278,973 100.0%$44,753,129,589 30,653,268,424 100.0% 3.8% 2.8% 0.0% 1 Berries $3,912,233,742 1,309,025,302 8.4% $3,695,174,358 1,236,444,907 8.3% 5.9% 5.9% 0.2% 2 Packaged Salad $3,539,480,185 1,271,433,035 7.6% $3,225,382,908 1,184,307,739 7.2% 9.7% 7.4% 0.4% 3 Citrus $2,775,069,269 2,221,698,253 6.0% $2,548,791,875 2,053,911,612 5.7% 8.9% 8.2% 0.3% 4 Apples $2,772,422,455 1,811,679,404 6.0% $2,840,389,531 1,790,455,854 6.3%

• 2.4%

1.2%

• 0.4%

5 Grapes $2,595,599,510 1,189,582,092 5.6% $2,573,834,844 1,151,268,002 5.8% 0.8% 3.3%

• 0.2%

6 Bananas $2,516,454,986 4,419,180,993 5.4% $2,532,014,178 4,425,832,471 5.7%

• 0.6%
• 0.2%
• 0.2%

7 Tomatoes $2,493,666,260 1,090,359,180 5.4% $2,356,269,328 1,071,610,773 5.3% 5.8% 1.7% 0.1% 8 Potatoes $2,348,682,398 3,401,915,482 5.1% $2,389,388,861 3,462,052,712 5.3%

• 1.7%
• 1.7%
• 0.3%

9 Value-Added Fruit $2,108,584,762 665,414,007 4.5% $1,946,485,487 651,911,615 4.3% 8.3% 2.1% 0.2% 10 Cooking Vegetables $1,699,311,257 1,002,588,595 3.7% $1,651,014,161 998,792,304 3.7% 2.9% 0.4%

• 0.0%

11 Value-Added Vegetables $1,607,086,679 518,443,898 3.5% $1,455,086,742 481,682,484 3.3% 10.4% 7.6% 0.2% 12 Onions $1,416,899,113 1,425,574,256 3.1% $1,439,928,751 1,459,543,349 3.2%

• 1.6%
• 2.3%
• 0.2%

13 Peppers $1,349,839,709 603,537,092 2.9% $1,287,084,581 584,964,908 2.9% 4.9% 3.2% 0.0% 14 Beverages $1,258,307,001 379,803,635 2.7% $1,095,152,691 338,460,635 2.4% 14.9% 12.2% 0.3% 15 Avocados $1,227,853,537 1,180,559,078 2.6% $1,088,506,577 975,759,447 2.4% 12.8% 21.0% 0.2% 16 Lettuce $1,216,750,888 659,254,010 2.6% $1,174,275,708 656,987,587 2.6% 3.6% 0.3%

• 0.0%

17 Melons $1,137,139,444 2,150,169,617 2.4% $1,122,872,250 2,020,200,736 2.5% 1.3% 6.4%

• 0.1%

18 Nuts & Seeds $1,080,284,477 165,950,928 2.3% $1,077,708,503 175,466,415 2.4% 0.2%

• 5.4%
• 0.1%

19 Stone Fruits $887,032,230 478,935,950 1.9% $920,430,128 484,199,229 2.1%

• 3.6%
• 1.1%
• 0.1%

20 Herbs, Spices and Seasonings $868,251,642 660,216,177 1.9% $796,814,648 626,013,941 1.8% 9.0% 5.5% 0.1% 21 Cucumbers $710,728,363 714,903,284 1.5% $674,848,566 684,659,372 1.5% 5.3% 4.4% 0.0%

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U.S. Tomato Retail Market Segmentation

Retail Tomato Dollars Retail Tomato Volume (lbs)

Note – information above excludes Costco and BJs which are 100% Greenhouse retailers.

Field 543,481,008 50% Greenhouse 454,057,094 42% Undefined 92,820,865 8%

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Strategically Located Operations

Canada

• 85 total acres – 3 facilities
• 65 acres - Tomatoes
• 9 acres – Bell peppers
• 11 acres – English cucumbers
• Production – year round

VF Greenhouses Partner Growers

Mexico

• 45 total acres – 3 facilities
• All tomato types
• Mini -cucumbers

British Columbia

• 3 greenhouses in Delta, BC
• 441,168 square metres
• 110 acres
• Production:
• Tomatoes-on-the-vine
• Beefsteak tomatoes
• Cocktail tomatoes
• Specialties

Greenhouses Partners Distribution Centers Corporate Offices

• VFF has the logistics and distribution capabilities to ensure fresh high quality produce

that meets consumer demands.

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Texas

• 2 greenhouses in Marfa & Ft. Davis
• 100 acres
• Production:
• All varieties of tomatoes
• 1 greenhouse in Monahans
• 30 acres
• Production:
• Tomatoes-on-the-vine
• Long English Cucumbers

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Financial Performance

Revenue (US$ millions) EBITDA (US$ millions)

• VFF revenue negatively impacted by Loss of Acreage
• Hail Storm in May 2012 – took out 82 acres – reducing production and revenues
• 40 Acres up and operational late 2012
• Another 20 acres up and operational in Summer 2014 (20 acres to be rebuilt – TBD)
• VFF EBITDA impacted by
• Hail Storm Proceeds in 2012 & 2013
• Low Pricing on TOV variety most of 2014
• LTM Trending Higher - due to lower TOV and increased higher margin specialties

$133.1 $130.5 $144.8 $164.4 $133.9 $137.6 $136.6 $133.6 $- $20.0 $40.0 $60.0 $80.0 $100.0 $120.0 $140.0 $160.0 $180.0 2008 2009 2010 2011 2012 2013 2014 LTM $19.0 $9.1 $15.1 $15.7 $1.6 $12.9 $8.7 $10.7 $- $5.0 $10.0 $15.0 $20.0 $25.0 $30.0 2008 2009 2010 2011 2012 2013 2014 LTM Reported EBITDA Normalized EBITDA

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Select Balance Sheet Info

Expressed in Thousands USD (000’s) As of Sept. 30 2015 As of Dec 31 2014

Assets Cash $ 5,147 $ 6,337 Accounts Receivable $10,197 $ 9,168 Inventory (Including Bio Asset) $16,994 $19,122 Other $ 839 $1,168 Net Fixed Assets $ 97,653 $103,094 Total Assets $130,830 $138,889 Liabilities Short Term Debt $4,392 $ 4,418 Accounts payable $8,551 $11,795 Other (Including Def. Tax) $11,929 $12,729 Long Term Debt $45,534 $48,947 Total Liabilities $70,406 $77,889 Shareholders' Equity $60,424 $61,000

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Significant Insider Ownership

Shareholder Overview (fully diluted)

1 Includes options. Total company stock options outstanding1,849,999 options. 2 Management estimate 3 Co-founder left Company in 2010 announced his intention to sell 4.2m shares in 2014.

• Insiders hold an economic interest in Village Farms of approximately 51.7%

Number of Shares % Ownership Insiders Michael DeGiglio(1) 10,304,149 25.3% Other Insiders(1) Albert Vanzeyst(3) 2,384,399 8,332,233 5.9% 20.5% Insiders Total 21,020,781 51.7% Institutions Canagro Century Holdings (2) 3,847,187 9.5% Other (2) 6,244,269 15.3% Institutional Total 10,091,456 24.8% Retail (2) 9,545,107 23.5% Total (1) 40,657,344 100.0%

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Experienced Management Team

Mike DeGiglio – Chief Executive Officer and Director

• Co-Founder; Served as Chief Executive Officer since inception
• 30 years intensive agricultural experience in controlled environmental growing – former CEO of two other

industry related companies in greenhouse and agriculture biotechnology

• Served on active duty in the United States Navy as an officer and jet aviator (1976 – 1983), and the Naval Air

Reserves (1983 – 2001), retiring at the rank of Captain

Stephen Ruffini – Chief Financial Officer and Director

• Joined Village Farms in 2009
• Previously at HIT Entertainment PLC where he served as Chief Financial Officer
• 25 years of extensive financial, operations, investor relations and mergers and acquisitions experience with

leading international companies

Doug Kling – Chief Marketing Officer

• Joined Village Farms in 2008
• Previously at Johanna Foods where he served as VP – Sales and Marketing / Mgmt. Board
• 30 years of extensive management experience in sales, marketing and acquisitions with global CPG companies

including Cadbury Schweppes and Nabisco Brands.

Bret Wiley – Senior Vice President of Sales

• Joined Village Farms in 1998
• Previously at Dole Fresh and Gargiulo Inc.
• 30 years of extensive sales, retail and marketing experience

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Investment Summary Highlights

Greenhouse Produce Industry Leader Financial Performance & Valuation Value-Add and Sustainability Story

• Vertically integrated year-round direct supplier to leading retailers
• Largest greenhouse producer in North America
• Strong reputation as industry innovator in quality and safety and varieties
• “Local source” produce supplier – market is short of US grown supply
• Small carbon and physical footprint
• Highly productive compared to field farming
• Improving Financial Results in 2015
• Returning to Normalized Returns in 2016
• Undervalued as compared to other greenhouse operations

Strong Industry Trends

• Innovative greenhouse technologies improve efficiencies in energy and water use
• Growing more specialty products with superior quality, taste, appearance
• Improving safety systems ensure high quality and safety of products

Barriers to Entry

• High Capital Costs – approx. $1.5m/acre
• Need experienced growing team and climate knowledge
• More stringent Food Safety Regulations and Retailer Audits