Evogene Reports Third Quarter 2016 Financial Results

REHOVOT, Israel, Nov. 21, 2016 (GLOBE NEWSWIRE) -- Evogene Ltd. (NYSE:EVGN) (TASE:EVGN), a leading company for the improvement of crop productivity and economics for the food, feed and fuel industries, announced today its financial results for the third quarter and nine months ended September 30, 2016.

Ofer Haviv, Evogene's President and CEO, stated: "We continue to be very pleased with the progress we are seeing in both our on-going collaborations with leading agriculture related companies world-wide, and our own internal programs.  In this respect, we are particularly pleased to have recently announced positive results in our Ag-biologicals program, focused on bio-stimulants,  for more than ten microbial strains that successfully completed the first year of testing and validation in corn for drought resistance. Further ahead, we will look to out-license advanced microbial strains to relevant partners for further development and commercialization, with the view to have a commercial product offering as early as five to six years from today."

"In our seed traits area, where we have active programs for the development of both crop enhancement traits and crop protection traits, we continue to build upon the positive results we announced in several of our most significant programs. These activities include supporting the advancement of our most promising candidate genes further in Monsanto's product development pipeline, and further validation of several successful candidate toxins we identified as part of our insect control program," continued Mr. Haviv.

"In addition, this past quarter we expanded our collaboration pipeline with the signing of an agreement with IMAmt, a leading Brazilian developer and marketer of cotton seeds, for the discovery and validation of novel genomic elements to support IMAmt's product development of insect-resistant cotton varieties."

"Finally, we continue to successfully advance our program for the discovery of novel chemical compounds for herbicides. This past quarter, chemical compounds identified by Evogene have demonstrated herbicidal activity in plant bio-essay tests and were advanced to the next stage of optimization," concluded Mr. Haviv.

Financial results for the period ended September 30, 2016:

Cash position: As of September 30, 2016, Evogene had $93.1 million in cash, short-term bank deposits and marketable securities, representing a net cash usage of $3.9 million for the third quarter and $7.6 million for the nine months ended September 30, 2016. We expect our net annual cash usage for the current calendar year to be slightly below our previously disclosed range of $14 to $16 million.

Revenues primarily consist of research and development payments, reflecting R&D cost reimbursement under certain of our collaboration agreements. The majority of these agreements also provide for development milestone payments and royalties or other forms of revenue sharing from successfully developed products, and therefore, longer term, the Company anticipates that its future revenues and profitability will largely reflect the receipt of such payments from its existing and future collaborations.

Revenues for the third quarter of 2016 were $1.5 million compared to $3.3 million for the same period in 2015. Revenues for the nine months ended September 30, 2016 were $5.4 million, compared to $8.7 million for the same period in 2015. This decline reflects the net decrease in such research and development payments in accordance with the work plans under Evogene's various collaboration agreements. It includes changes in the scope and type of activities undertaken by the Company as part of its yield and stress collaboration with Monsanto, whereby resource intensive activities, such as novel gene discovery and validation, evolved to focus increasingly on optimization activities supporting Monsanto's ongoing development with respect to advancing Evogene discovered genes.

Cost of revenues include research and development expenses related to the Company's on-going activities in support of collaboration agreements. Cost of revenues for the third quarter of 2016 were $1.4 million compared to $2.5 million for the same period in 2015.  Cost of revenues for the nine months ended September 30, 2016, were $4.5 million, compared to $6.2 million, for the same period in 2015. The net decrease primarily related to the change in the scope and type of activities performed under Evogene's collaboration with Monsanto, as noted above.

R&D expenses for the third quarter of 2016 were $3.9 million compared to $3.1 million for the same period in 2015. R&D expenses for the nine months ended September 30, 2016, were $11.7 million, compared to $10.3 million for the same period in 2015. This increase largely related to the expansion of activities, primarily focused on the development of computational platforms, as well as discovery and validation activities, in our key growth engines - insect control, ag-chemicals and ag-biologicals.

Operating loss for the third quarter of 2016 was $5.2 million compared with $3.8 million for the third quarter of 2015. Operating loss for the nine months ended September 30, 2016, was $14.9 million compared with $12.6 million for the same period in 2015. The increase in operating loss was primarily due to the decrease in revenues discussed above, which were partially offset by the net decline in other expense categories.

Net loss for the third quarter of 2016 was $5.1 million compared with a net loss of $3.4 million in the third quarter of 2015. Net loss for the nine months ended September 30, 2016, was $12.9 million compared with a net loss of $11.7 million for the same period in 2015.

Conference call and webcast details:

Evogene management will host a conference call today at 9:00 am Eastern time, 16:00 Israel time to discuss the results. US-based participants are invited to access the call by dialing 1-888-668-9141, and participants from Israel and other countries are invited to access the call at 972-3-918-0610. A replay of the conference call will be available beginning at approximately 1:00 pm Eastern time, 20:00 Israel time today, and will be accessible through November 23, 2016.  US-based participants are invited to access the replay by dialing 1-888-254-7270, and participants from Israel and other countries are invited to access the replay at 972-3-925-5937. A replay of the call may also be accessed as a webcast via Evogene's website at www.evogene.com and will be available for a period of ten days.

About Evogene Ltd.:Evogene (NYSE:EVGN) (TASE:EVGN) is a leading biotechnology company for the improvement of crop productivity for the food, feed and fuel industries. The Company operates in three key market segments: improved seed traits (addressing yield increase, tolerance to environmental stresses and resistance to insects and diseases); innovative ag-chemicals (developing novel herbicide solutions for weed control); and ag-biologicals. Evogene has collaborations with world-leading seed and ag-chemical companies. For more information, please visit www.evogene.com or contact the Company at info@evogene.com.

This press release contains "forward-looking statements" relating to future events. These statements may be identified by words such as "may", "could", "expects", "intends", "anticipates", "plans", "believes", "scheduled", "estimates" or words of similar meaning. Such statements are based on current expectations, estimates, projections and assumptions, describe opinions about future events, involve certain risks and uncertainties which are difficult to predict and are not guarantees of future performance. Therefore, actual future results, performance or achievements of Evogene may differ materially from what is expressed or implied by such forward-looking statements due to a variety of factors, many of which beyond Evogene's control, including, without limitation, those risk factors contained in Evogene's reports filed with the appropriate securities authority. Evogene disclaims any obligation or commitment to update these forward-looking statements to reflect future events or developments or changes in expectations, estimates, projections and assumptions.

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
U.S. dollars in thousands (except share and per share data)
 
    As of September 30,   As ofDecember 31,
      2016       2015       2015  
    Unaudited   Audited
CURRENT ASSETS:            
Cash and cash equivalents   $   5,439     $   11,847     $    10,221  
Restricted cash     47       47       47  
Marketable securities     72,520       79,867       71,807  
Short-term bank deposits     15,058       14,591       18,603  
Trade receivables     100       963       2,675  
Other receivables     1,778       1,083       1,023  
             
      94,942       108,398       104,376  
LONG-TERM ASSETS:            
Long-term deposits     14       25       22  
Property, plant and equipment, net     6,829       7,943       8,197  
             
      6,843       7,968       8,219  
             
    $   101,785     $   116,366     $   112,595  
             
CURRENT LIABILITIES:            
Trade payables   $   1,071     $   1,021     $   1,771  
Other payables     2,695       2,428       3,049  
Liabilities in respect of government grants     680       470       259  
Deferred revenues and other advances     1,126       824       560  
             
      5,572       4,743       5,639  
             
LONG-TERM LIABILITIES:            
Liabilities in respect of government grants     2,747       3,054       2,880  
Deferred revenues and other advances     154       447       298  
Severance pay liability, net     30       31       26  
             
      2,931       3,532       3,204  
SHAREHOLDERS' EQUITY:            
Ordinary shares of NIS 0.02 par value:                        
Authorized - 150,000,000 ordinary shares; Issued and outstanding - 25,459,809, 25,394,388 and 25,404,362 shares at September 30, 2016 and 2015 and December 31, 2015, respectively     140       140       140  
Share premium and other capital reserve     182,693       179,081       180,214  
Accumulated deficit     (89,551 )     (71,130 )     (76,602 )
             
      93,282       108,091       103,752  
             
    $   101,785     $   116,366     $   112,595  
 

CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME (LOSS)
U.S. dollars in thousands (except share and per share data)
 
    Nine months ended September 30,   Three months ended September 30,   Year endedDecember 31,
      2016       2015       2016       2015       2015  
    Unaudited   Audited
                     
Revenues   $ 5,360     $ 8,666     $   1,536     $   3,309     $   11,129  
Cost of revenues     4,508       6,249       1,418       2,487       8,255  
                     
Gross profit     852       2,417       118       822       2,874  
                     
Operating expenses:                    
                     
Research and development, net     11,670       10,326       3,905       3,097       14,449  
Business development     1,225       1,505       435       506       1,964  
General and administrative     2,894       3,138       950       1,001       4,382  
                     
Total operating expenses     15,789       14,969       5,290       4,604       20,795  
                     
Operating loss     (14,937 )     (12,552 )     (5,172 )     (3,782 )     (17,921 )
                     
Financing income     2,286       2,045       191       768       2,571  
Financing expenses     (277 )     (1,234 )     (112 )     (368 )     (1,863 )
                     
Loss before taxes on income       (12,928 )       (11,741 )       (5,093 )       (3,382 )       (17,213 )
Taxes on income     21       -       21       -       -  
                     
Net loss   $   (12,949 )   $   (11,741 )   $   (5,114 )   $   (3,382 )   $   (17,213 )
                     
Other comprehensive income (loss):                    
Loss from cash flow hedges   $   -     $   (45 )   $    -     $   -     $   (45 )
Amounts transferred to the statement of profit or loss for cash flow hedges     -       267       -       -       267  
                     
Total comprehensive loss   $   (12,949 )   $   (11,519 )   $   (5,114 )   $   (3,382 )   $   (16,991 )
                     
Basic and diluted loss per share   $   (0.51 )   $  (0.46 )   $   (0.20 )   $  (0.13 )   $   (0.68 )
 

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
U.S. dollars in thousands
 
    Share capital   Share premiumand othercapital reserve   Accumulateddeficit   Total
        Unaudited    
Balance as of January 1, 2016 (audited)   $   140     $   180,214     $   (76,602 )   $   103,752  
Net and comprehensive loss     -       -     (12,949 )     (12,949 )
Exercise of options     *) -       143     -     143  
Share-based compensation     -       2,336     -     2,336  
             
Balance as of September 30, 2016   $   140     $   182,693   $   (89,551 ) $   93,282  

*) Represents an amount lower than $1

    Share capital   Share premiumand othercapital reserve   Accumulatedothercomprehensiveloss   Accumulateddeficit   Total
    Unaudited
Balance as of January 1, 2015 (audited)   $   140     $   175,553     $   (222 )   $   (59,389 )   $     116,082  
Net loss     -       -       -       (11,741 )     (11,741 )
Other comprehensive income     -       -       222       -       222  
Exercise of options      *) -       237       -       -       237  
Share-based compensation     -       3,291       -       -       3,291  
                     
Balance as of September 30, 2015   $   140     $   179,081     $    -     $   (71,130 )   $   108,091  

*) Represents an amount lower than $1

    Share capital   Share premiumand othercapital reserve   Accumulateddeficit   Total
        Unaudited    
Balance as of July 1, 2016   $   140     $   181,985     $   (84,437 )   $   97,688  
Net and comprehensive loss     -       -     (5,114 )     (5,114 )
Exercise of options     *) -       29     -     29  
Share-based compensation     -       679     -     679  
             
Balance as of September 30, 2016   $   140     $   182,693   $   (89,551 ) $   93,282  

*) Represents an amount lower than $1

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
U.S. dollars in thousands
 
    Share Capital   Share Premiumand othercapital reserve   AccumulatedDeficit   Total
    Unaudited
                 
                 
Balance as of July 1, 2015   $   140     $   177,962     $   (67,748 )   $   110,354  
                 
Net and comprehensive loss     -       -       (3,382 )     (3,382 )
Exercise of options     *) -       29       -       29  
Share-based  compensation     -       1,090       -       1,090  
                 
Balance as of September 30, 2015   $   140     $   179,081     $   (71,130 )   $   108,091  

*) Represents an amount lower than $1

    Share capital   Share premiumand othercapital reserve   Accumulatedothercomprehensiveloss   Accumulateddeficit   Total
    Audited
                     
Balance as of January 1, 2015   $   140     $   175,553     $   (222 )   $   (59,389 )   $   116,082  
Net loss     -       -       -       (17,213 )     (17,213 )
Other comprehensive income     -       -       222       -       222  
Exercise of options     *) -       296       -       -       296  
Share-based compensation     -       4,365       -       -       4,365  
                     
Balance as of December 31, 2015   $   140     $   180,214     $    -     $   (76,602 )   $   103,752  

*) Represents an amount lower than $1

CONSOLIDATED STATEMENTS OF CASH FLOWS
U.S. dollars in thousands
 
    Nine months ended September 30,   Three months ended September 30,   Year endedDecember 31,
      2016       2015       2016       2015       2015  
    Unaudited   Audited
Cash flows from operating activities                    
                     
Net loss   $   (12,949 )   $   (11,741 )   $   (5,114 )   $   (3,382 )   $   (17,213 )
                     
Adjustments to reconcile net loss to net cash used in operating activities:                    
                     
Adjustments to the profit or loss items:                    
                     
Depreciation and amortization     1,763       1,849       587       583       2,433  
Share-based compensation     2,336       3,291       679       1,090       4,365  
Net financing income     (2,168 )     (896 )     (151 )     (445 )     (845 )
Loss from sale of property, plant and equipment     17       -       -       -       -  
Taxes on income     21       -       21       -       -  
                     
      1,969       4,244       1,136       1,228       5,953  
Changes in asset and liability items:                    
                     
Decrease (increase) in trade receivables     2,575       220       (20 )     (213 )     (1,492 )
Increase in other receivables     (667 )     (335 )     (190 )     (23 )     (293 )
Decrease (increase) in long-term deposits     8       (4 )     2       (1 )     (1 )
Decrease in trade payables     (359 )     (546 )     (118 )     (146 )     (68 )
Increase (decrease) in other payables     (415 )     (1,303 )     181       (57 )     (640 )
Increase (decrease) in severance pay liability, net     4       2       -       3       (3 )
Increase (decrease) in deferred revenues and other advances     422       (642 )     303       (771 )     (1,055 )
Increase (decrease) in liabilities in respect of government grants     115       -       -       -       (284 )
                     
      1,683       (2,608 )     158       (1,208 )     (3,836 )
                     
Cash received (paid) during the period for:                    
                     
Interest received     1,838       2,119       684       747       2,689  
Taxes paid     (2 )     -       (2 )     -       -  
                     
                     
Net cash used in operating activities     (7,461 )     (7,986 )     (3,138 )     (2,615 )     (12,407 )
 

CONSOLIDATED STATEMENTS OF CASH FLOWS
U.S. dollars in thousands
 
    Nine months ended September 30,   Three months ended September 30,   Year endedDecember 31,
      2016       2015       2016       2015       2015  
    Unaudited   Audited
Cash flows from investing activities                    
                     
Purchase of property, plant and equipment   $   (711 )   $   (1,397 )   $   (237 )   $   (548 )   $   (2,005 )
Proceeds from sale of marketable securities     17,192       22,128       5,568       7,274       38,164  
Purchase of marketable securities     (17,576 )     (22,533 )     (3,826 )     (8,628 )     (31,168 )
Proceeds from bank deposits, net     3,545       15,455       1,503       8,637       11,443  
Decrease (increase) in restricted cash     -       953       -       (47 )     953  
                     
Net cash provided by investing activities     2,450       14,606       3,008       6,688       17,387  
                     
Cash Flows from Financing Activities                    
                     
Proceeds from exercise of options     143       237       29       29       296  
Proceeds from government grants     404       188       146       -       167  
Repayment of government grants     (333 )     (418 )     (134 )     (185 )     (418 )
                     
Net cash provided by (used in) financing activities     214       7       41       (156 )     45  
                     
Exchange rate differences - cash and cash equivalent balances     15       7       (5 )     (19 )     (17 )
                     
Increase (decrease) in cash and cash equivalents     (4,782 )     6,634       (94 )     3,898       5,008  
                     
Cash and cash equivalents, beginning of the period     10,221       5,213       5,533       7,949       5,213  
                     
Cash and cash equivalents, end of the period   $  5,439     $   11,847     $   5,439     $   11,847     $   10,221  
                     
Significant non-cash transactions                    
                     
Acquisition of property, plant and equipment   $   50     $   119     $   50     $   119     $   349  

Contact:Karen MazorDirector, Public and Investor RelationsE: IR@evogene.comT: +972 54 22 88 039

Primary Logo

More from Press Releases

NFL Pushes for Regulation Following Supreme Court's Sports Gambling Ruling

NFL Pushes for Regulation Following Supreme Court's Sports Gambling Ruling

21st Century Fox Scoops Up Local News Stations

21st Century Fox Scoops Up Local News Stations

Walmart CEO: 'We Are Transforming Globally' With Flipkart

Walmart CEO: 'We Are Transforming Globally' With Flipkart

Three-Part FREE Webinar Series

Three-Part FREE Webinar Series

March 24 Full-Day Course Offering: Professional Approach to Trading SPX

March 24 Full-Day Course Offering: Professional Approach to Trading SPX