| Segment and Geographic Information |
12. SEGMENT AND GEOGRAPHIC INFORMATION The Company regularly monitors its reportable segments to determine if changes in facts and circumstances would indicate whether changes in the determination or aggregation of operating segments are necessary. In the fourth quarter of 2024, the Company determined that Leli had met the quantitative threshold to be a reportable segment. In addition, during the fourth quarter of 2024, the chief operating decision-maker (“CODM”) changed the segment profit measure from gross margin to operating income or loss. We believe that segment operating (loss) income is a more useful measure because it allows management, analysts, investors, and other interested parties to evaluate the profitability of our business operations before the effects of certain expenses that directly arise from non-operating activities (other income/expense), financing decisions (interest), and tax strategies (income taxes). These changes have been applied to all periods presented. Segment reporting is prepared on the same basis that the Company’s Chief Executive Officer, who is the CODM, manages the business, makes operating decisions and assesses performance. Management has determined that the Company operates in five reportable segments: Cannabis-Canada, Cannabis-U.S., Cannabis - Netherlands (previously Leli), Produce, and Clean Energy. The Cannabis-Canada segment produces and supplies cannabis products to be sold to other licensed providers and provincial governments across Canada and internationally. The Cannabis-U.S. segment develops and sells high-quality, CBD-based health and wellness products including ingestible, edible and topical applications across the United States. The Cannabis - Netherlands segment produces and supplies cannabis products in the Netherlands, supplying designated coffee shops. The Produce segment produces, markets and sells premium quality tomatoes, bell peppers and cucumbers. The Clean Energy business receives a royalty representing a portion of the natural gas that is sold to one customer pursuant to its long-term contract. The accounting policies of the segments are the same as those described in the summary of business, basis of presentation and significant accounting policies. The Company evaluates performance for all of its reportable segments based on segment operating (loss) income from operations. For all of its reportable segments, the CODM uses segment operating (loss) income to allocate resources (including employees, property, and financial or capital resources) for each segment, predominantly in the annual budget and forecasting process. The CODM considers budget-to-actual variances on a monthly basis for the (loss) income when making decisions about allocating capital and personnel to the segments. The CODM also uses segment (loss) income to assess the performance for each segment by comparing the results with one another. Discontinued operations are not included in the applicable reportable segments. The following tables reflect the reconciliation of segment revenue and significant segment expenses from continuing operations reconciled to the consolidated income (loss) from continuing operations before income taxes and equity method investments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended June 30, 2025 |
|
|
Produce |
|
|
Cannabis Canada |
|
|
Cannabis U.S. |
|
|
Clean
Energy |
|
|
Cannabis Netherlands |
|
|
Total |
|
Sales to external customers |
$ |
8,574 |
|
|
$ |
44,518 |
|
|
$ |
3,841 |
|
|
$ |
483 |
|
|
$ |
2,483 |
|
|
$ |
59,899 |
|
Cost of sales |
|
(7,975 |
) |
|
|
(27,050 |
) |
|
|
(1,405 |
) |
|
|
(80 |
) |
|
|
(1,047 |
) |
|
|
(37,557 |
) |
Selling, general and administrative expenses |
|
(870 |
) |
|
|
(8,604 |
) |
|
|
(2,445 |
) |
|
|
27 |
|
|
|
(557 |
) |
|
|
(12,449 |
) |
Segment operating income (loss) |
$ |
(271 |
) |
|
$ |
8,864 |
|
|
$ |
(9 |
) |
|
$ |
430 |
|
|
$ |
879 |
|
|
$ |
9,893 |
|
Reconciliation of segment operating (loss) income to income from continuing operations before taxes and income from equity method investments(1) |
|
Other income, net (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,517 |
|
Other corporate expenses (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,962 |
) |
Income from continuing operations before taxes and income from equity method investments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
12,448 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended June 30, 2024 |
|
|
Produce |
|
|
Cannabis Canada |
|
|
Cannabis U.S. |
|
|
Clean
Energy |
|
|
Cannabis Netherlands |
|
|
Total |
|
Sales to external customers |
$ |
8,434 |
|
|
$ |
40,745 |
|
|
$ |
4,297 |
|
|
$ |
121 |
|
|
$ |
— |
|
|
$ |
53,597 |
|
Cost of sales |
|
(8,209 |
) |
|
|
(30,040 |
) |
|
|
(1,668 |
) |
|
|
(43 |
) |
|
|
— |
|
|
|
(39,960 |
) |
Selling, general and administrative expenses |
|
(1,003 |
) |
|
|
(8,749 |
) |
|
|
(2,960 |
) |
|
|
(17 |
) |
|
|
(341 |
) |
|
|
(13,070 |
) |
Segment operating (loss) income |
$ |
(778 |
) |
|
$ |
1,956 |
|
|
$ |
(331 |
) |
|
$ |
61 |
|
|
$ |
(341 |
) |
|
$ |
567 |
|
Reconciliation of segment operating (loss) income to loss from continuing operations before taxes and income from equity method investments(1) |
|
Other expense, net (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(937 |
) |
Goodwill and intangible asset impairments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(11,939 |
) |
Other corporate expenses (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3,986 |
) |
Loss from continuing operations before taxes and income from equity method investments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
(16,295 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months Ended June 30, 2025 |
|
|
Produce |
|
|
Cannabis Canada |
|
|
Cannabis U.S. |
|
|
Clean
Energy |
|
|
Cannabis Netherlands |
|
|
Total |
|
Sales to external customers |
$ |
8,601 |
|
|
$ |
79,355 |
|
|
$ |
7,745 |
|
|
$ |
909 |
|
|
$ |
2,969 |
|
|
$ |
99,579 |
|
Cost of sales |
|
(9,444 |
) |
|
|
(49,412 |
) |
|
|
(2,716 |
) |
|
|
(153 |
) |
|
|
(1,332 |
) |
|
|
(63,057 |
) |
Selling, general and administrative expenses |
|
(1,585 |
) |
|
|
(17,366 |
) |
|
|
(4,980 |
) |
|
|
(1 |
) |
|
|
(996 |
) |
|
|
(24,928 |
) |
Segment operating (loss) income |
$ |
(2,428 |
) |
|
$ |
12,577 |
|
|
$ |
49 |
|
|
$ |
755 |
|
|
$ |
641 |
|
|
$ |
11,594 |
|
Reconciliation of segment operating (loss) income to income from continuing operations before taxes and income from equity method investments(1) |
|
Other income, net (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,827 |
|
Other corporate expenses (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(5,102 |
) |
Income from continuing operations before taxes and income from equity method investments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
11,319 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months Ended June 30, 2024 |
|
|
Produce |
|
|
Cannabis Canada |
|
|
Cannabis U.S. |
|
|
Clean
Energy |
|
|
Cannabis Netherlands |
|
|
Total |
|
Sales to external customers |
$ |
8,438 |
|
|
$ |
78,191 |
|
|
$ |
8,834 |
|
|
$ |
121 |
|
|
$ |
— |
|
|
$ |
95,584 |
|
Cost of sales |
|
(9,199 |
) |
|
|
(57,978 |
) |
|
|
(3,510 |
) |
|
|
(43 |
) |
|
|
— |
|
|
|
(70,730 |
) |
Selling, general and administrative expenses |
|
(1,559 |
) |
|
|
(16,453 |
) |
|
|
(6,366 |
) |
|
|
(37 |
) |
|
|
(704 |
) |
|
|
(25,119 |
) |
Segment operating (loss) income |
$ |
(2,320 |
) |
|
$ |
3,760 |
|
|
$ |
(1,042 |
) |
|
$ |
41 |
|
|
$ |
(704 |
) |
|
$ |
(265 |
) |
Reconciliation of segment operating (loss) income to loss from continuing operations before taxes and income from equity method investments(1) |
|
Other expense, net (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,419 |
) |
Goodwill and intangible asset impairments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(11,939 |
) |
Other corporate expenses (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(6,187 |
) |
Loss from continuing operations before taxes and income from equity method investments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
(20,810 |
) |
(1)The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM. (2)Other income (expense), net is comprised of interest expense, interest income, foreign exchange (loss) gain, other income (expense). (3)Other corporate expenses are comprised of expenses related to centralized corporate functions such as accounting, treasury, information technology, legal, human services, and internal audit expenses. The following tables summarize our interest income, interest expense, depreciation and amortization, other significant noncash items, and expenditures for capital assets by reportable segment:
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months Ended June 30, 2025 |
|
|
Produce |
|
Cannabis Canada |
|
Cannabis U.S. |
|
Clean
Energy |
|
Cannabis Netherlands |
|
Segment Totals |
|
Corporate |
|
Consolidated Totals |
|
Interest income |
|
1 |
|
|
134 |
|
|
— |
|
|
— |
|
|
— |
|
|
135 |
|
|
49 |
|
|
184 |
|
Interest expense |
|
924 |
|
|
592 |
|
|
— |
|
|
— |
|
|
— |
|
|
1,516 |
|
|
— |
|
|
1,516 |
|
Depreciation and amortization |
|
2,273 |
|
|
5,303 |
|
|
98 |
|
|
— |
|
|
654 |
|
|
8,328 |
|
|
82 |
|
|
8,410 |
|
Share based compensation |
|
19 |
|
|
73 |
|
|
12 |
|
|
— |
|
|
— |
|
|
104 |
|
|
164 |
|
|
268 |
|
Other significant noncash items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-cash lease expense |
|
85 |
|
|
42 |
|
|
493 |
|
|
— |
|
|
— |
|
|
619 |
|
|
— |
|
|
619 |
|
Expenditures for segment assets |
|
708 |
|
|
1,230 |
|
|
7 |
|
|
— |
|
|
3,344 |
|
|
5,289 |
|
|
— |
|
|
5,289 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months Ended June 30, 2024 |
|
|
Produce |
|
Cannabis Canada |
|
Cannabis U.S. |
|
Clean
Energy |
|
Cannabis Netherlands |
|
Segment Totals |
|
Corporate |
|
Consolidated Totals |
|
Interest income |
|
3 |
|
|
188 |
|
|
— |
|
|
— |
|
|
— |
|
|
191 |
|
|
337 |
|
|
528 |
|
Interest expense |
|
1,145 |
|
|
670 |
|
|
— |
|
|
— |
|
|
— |
|
|
1,815 |
|
|
— |
|
|
1,815 |
|
Depreciation and amortization |
|
1,639 |
|
|
5,880 |
|
|
104 |
|
|
— |
|
|
627 |
|
|
8,250 |
|
|
106 |
|
|
8,356 |
|
Share based compensation |
|
— |
|
|
97 |
|
|
83 |
|
|
— |
|
|
— |
|
|
180 |
|
|
2,421 |
|
|
2,601 |
|
Other significant noncash items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-cash lease expense |
|
62 |
|
|
43 |
|
|
283 |
|
|
— |
|
|
— |
|
|
388 |
|
|
— |
|
|
388 |
|
Expenditures for segment assets |
|
738 |
|
|
127 |
|
|
26 |
|
|
— |
|
|
1,842 |
|
|
2,733 |
|
|
— |
|
|
2,733 |
|
The following tables summarize our total assets by reportable segment:
|
|
|
|
|
|
|
|
|
|
|
June 30, 2025 |
|
|
December 31, 2024 |
|
Assets |
|
|
|
|
|
|
Produce |
|
$ |
64,327 |
|
|
$ |
51,983 |
|
Cannabis - Canada |
|
|
280,945 |
|
|
|
266,433 |
|
Cannabis - United States |
|
|
5,734 |
|
|
|
6,728 |
|
Clean Energy |
|
|
577 |
|
|
|
360 |
|
Cannabis - Netherlands |
|
|
17,024 |
|
|
|
11,093 |
|
Total assets for reportable segments |
|
$ |
368,607 |
|
|
$ |
336,597 |
|
Corporate |
|
|
34,629 |
|
|
|
7,360 |
|
Consolidated total assets from continuing operations |
|
$ |
403,236 |
|
|
$ |
343,957 |
|
The Company’s primary operations are in the United States, Canada, and the Netherlands. The following tables summarizes our assets by geographic location:
|
|
|
|
|
|
|
|
|
Total assets from continuing operations |
|
June 30, 2025 |
|
|
December 31, 2024 |
|
United States |
|
$ |
55,684 |
|
|
$ |
46,922 |
|
Canada |
|
|
330,528 |
|
|
|
285,942 |
|
Netherlands |
|
|
17,024 |
|
|
|
11,093 |
|
|
|
$ |
403,236 |
|
|
$ |
343,957 |
|
|
|
|
|
|
|
|
Long-lived assets from continuing operations |
|
June 30, 2025 |
|
|
December 31, 2024 |
|
United States |
|
$ |
30,400 |
|
|
$ |
26,930 |
|
Canada |
|
|
222,104 |
|
|
|
216,061 |
|
Netherlands |
|
|
13,666 |
|
|
|
9,866 |
|
|
|
$ |
266,171 |
|
|
$ |
252,857 |
|
|