Evogene Reports Second Quarter 2024 Financial Results Form 6 K

Evogene Reports Second Quarter 2024 Financial Results

Conference call and webcast: today, August 22, 2024, 9:00 am ET

Financial and Business Highlights:

- H1 2024 revenues $5.1M, up from $1.3M in H1 2023; Q2 2024 revenues $914K, up from $654K in Q2 2023.

- Anticipated continued revenue growth in the second half of 2024 compared to the same period in the previous year, primarily driven by Casterra's initiation of supplying existing seed orders, which began in August 2024 and total over $8.0 million.

- H1 2024 loss $9.8M, down from $14.8M in H1 2023; Q2 2024 loss $6.0M, down from $7.8M in Q2 2023.

- Projected 2024 cash usage (excl. Biomica & Lavie Bio) $8.0M, down 36% from $12.5M in 2023.

- Implemented a 10:1 reverse stock split during July 2024.

Casterra:

- Received a $440K order for castor seeds from an existing customer for a new African country.

- Completed a successful castor seed season in Brazil, with shipments planned for Q3 2024.

- Seeds produced in Brazil and Africa in 2024, are anticipated to meet existing orders totaling approximately $8.4M.

Biomica:

- Promising Phase 1 results for BMC128 with nivolumab in RCC, NSCLC, and melanoma, presented at ASCO 2024.

Lavie Bio:

- A significant milestone achieved in ICL collaboration, developing yield-increasing bio-stimulants for row crops under extreme weather conditions by leveraging AI to identify over a dozen novel microbial candidates.

- Announced commercial expansion of Yalos™ bio-inoculant to winter wheat.

Rehovot, Israel - August 22, 2024 - Evogene Ltd. (Nasdaq: EVGN, TASE: EVGN), a leading computational biology company aiming to revolutionize the development of life-science-based products, today announced its financial results for the second quarter period ended June 30, 2024.

Mr. Ofer Haviv, Evogene's President and CEO, stated: "In our vision, we see Evogene as a pioneering company for creating groundbreaking life-science products, to improve life quality and longevity. During the past years we developed three innovative AI tech-engines addressing the main development challenges of products rooted in microbes, small molecules and genomics. Our AI tech-engines were structured to be compatible with the tremendous potential of various market segments and not limited to only one specific segment.

In order to capture the value of our AI tech-engines, our business strategy is to establish diverse collaborative partnerships through licensing or collaboration, with expert partners in specific fields that complement our technology. Together, we'll develop novel products, aiming for full or partial ownership upon project completion. This approach maximizes the potential of our AI tech-engines, while aiming to reduce financial and development risks. Today, Evogene has 4 subsidiaries, each focusing on a different market segment, and in addition, Evogene has diverse engagements with leading companies in additional market segments, not covered by our subsidiaries.

I am very pleased to share with you the main achievements made by Evogene's subsidiaries from the last report of our financial results."

Casterra Ag Ltd. - focuses on developing an integrated solution to enable large-scale commercial cultivation of castor to address the global demand for stable castor oil supply, mainly for the biodiesel industry. Casterra is utilizing Evogene's GeneRator AI tech engine to direct and accelerate the development of its unique elite castor seed varieties.

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Lavie Bio Ltd. - a leading ag-biologicals company that develops microbiome-based, computational-driven novel bio-stimulant and bio-pesticide products, utilizing Evogene's MicroBoost AI tech-engine.

Biomica Ltd. - a clinical-stage biopharmaceutical company developing innovative microbiome-based therapeutics, utilizing Evogene's MicroBoost AI tech-engine.

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Financial Highlights:

Cash Position: As of June 30, 2024, Evogene held consolidated cash, cash equivalents, and short-term bank deposits of approximately $20.9 million. This amount does not include $8.4 million of expected payments for the open purchase orders of Casterra . The consolidated cash usage during the second quarter of 2024 was approximately $5.7 million. Excluding Lavie Bio and Biomica, Evogene and its other subsidiaries used approximately $2.7 million in cash during the second quarter of 2024. Projected cash usage for 2024, excluding Lavie Bio and Biomica, is expected to be around $8.0 million, marking a notable 36% decrease from approximately $12.5 million in 2023.

Revenue: Revenues for the first half of 2024 were approximately $5.1 million, a significant increase from $1.3 million in the same period the previous year. This growth was primarily driven by revenues recognized from Lavie Bio's licensing agreement with Corteva and AgPlenus's new collaboration with Bayer. Revenues for the second quarter of 2024 were approximately $0.9 million, compared to approximately $0.7 million in the same period the previous year. The increase was mainly attributable to increased revenue in Lavie Bio.

Evogene anticipates continued revenue growth in the second half of 2024 compared to the previous year, mainly based on Casterra's forecast for seed-order supply.

R&D Expenses: Research and development expenses, net of non-refundable grants, for the first half of 2024 were approximately $8.8 million, a decrease from $10.2 million in the first half of 2023. The decrease in expenses is mainly due to the cease of Canonic's activities and a decrease in certain development expenses in Biomica as compared to the same period the previous year. Research and development expenses, net of non-refundable grants, for the second quarter of 2024 were approximately $4.0 million, and decreased significantly as compared to approximately $5.4 million in the same period in the previous year. The decrease is mainly attributable to decreased expenses in Canonic and Biomica, as mentioned above.

Sales and Marketing Expenses: Sales and Marketing expenses for the first half of 2024 were approximately $1.9 million, a slight increase from approximately $1.7 million in the same period in the previous year. The increase is mainly attributable to increased sales and marketing activities in Casterra during the first half of 2024 as compared to the same period in 2023. Sales and Marketing expenses for the second quarter of 2024 were approximately $0.9 million and remained stable as compared to approximately $0.9 million in the same period in the previous year.

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General and Administrative Expenses: General and administrative expenses for the first half of 2024 decreased slightly to approximately $3.2 million from approximately $3.3 million in the same period last year. General and administrative expenses for the second quarter of 2024 decreased to approximately $1.5 million compared to approximately $1.8 million in the same period of the previous year, mainly due to decreased non-cash compensation and salary related expenses in Lavie Bio and Biomica, respectively, in the second quarter of 2024.

Other Expenses: The decision to cease Canonic's operations in the first half of 2024 resulted in other expenses of approximately $0.5 million, mainly due to impairment of fixed assets in the first quarter of 2024.

Operating Loss: The operating loss for the first half of 2024 was approximately $10.2 million, a significant decrease from approximately $14.7 million in the same period of the previous year, mainly due to increased revenues as mentioned above. The operating loss for the second quarter of 2024 was approximately $6.1 million, a decrease from $7.9 million in the same period of the previous year, mainly due to decreased operating expenses as mentioned above.

Financing Income: Financing income, net for the first half of 2024 was $379 thousand, compared to financing expenses, net of $86 thousand in the same period of the previous year. This increase was primarily due to increased interest income and a revaluation of convertible SAFE. Financing income, net for the second quarter of 2024 was $138 thousand, compared to financing income, net of $144 thousand in the same period of the previous year.

Net Loss: The net loss for the first half of 2024 was approximately $9.8 million, compared to approximately $14.8 million in the same period last year. The $5.0 million decrease in net loss was primarily due to increased revenues, decreased operating expenses, partially offset by the one-time $0.5 million of other expenses, related to ceasing Canonic's operations and an increase in financial income. The net loss for the second quarter of 2024 was approximately $6.0 million, compared to approximately $7.8 million in the same period last year. The $1.8 million decrease in net loss was primarily due to decreased operating expenses as mentioned above.

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For the financial tables click here.

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Conference Call & Webcast Details: Thursday, August 22, 2024. 9:00 AM EST 4:00 PM IDT

To join the Zoom conference, please register in advance here

Or join via audio

Or, dial from the US: +15642172000, from Israel: +972 3 978 6688

Webinar ID:842 8320 2980

More International numbers

Webcast & Presentation link available at:

https://evogene.com/investor-relations/

About Evogene Ltd.

Evogene Ltd. (Nasdaq: EVGN, TASE: EVGN) is a computational biology company leveraging big data and artificial intelligence, aiming to revolutionize the development of life-science based products by utilizing cutting-edge technologies to increase the probability of success while reducing development time and cost.

Evogene established three unique tech-engines - MicroBoost AI, ChemPass AI and GeneRator AI. Each tech-engine is focused on the discovery and development of products based on one of the following core components: microbes (MicroBoost AI), small molecules (ChemPass AI), and genetic elements (GeneRator AI).

Evogene uses its tech-engines to develop products through strategic partnerships and collaborations, and its four subsidiaries including:

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For more information, please visit: www.evogene.com.

Forward-Looking Statements

This press release contains "forward-looking statements" relating to future events. These statements may be identified by words such as "may", "could", "expects", "hopes" "intends", "anticipates", "plans", "believes", "scheduled", "estimates", "demonstrates" or words of similar meaning. For example, Evogene and its subsidiaries are using forward-looking statements in this press release when they discuss Evogene's strategy, Evogene's ability to develop novel products, that Evogene's strategy will result groundbreaking innovations and significant financial gains for Evogene, Casterra's ability to supply all existing purchase orders by the end of 2024, Lavie Bio's market potential, Lavie Bio's pipeline advancement, Biomica's BMC128's future beneficial activity, and Evogene's projected cash usage for 2024 and Evogene anticipated continued revenue growth in the second half of 2024. 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 and its subsidiaries may differ materially from what is expressed or implied by such forward-looking statements due to a variety of factors, many of which are beyond the control of Evogene and its subsidiaries, including, without limitation, the current war between Israel, Hamas and Hezbollah and any worsening of the situation in Israel such as further mobilizations or escalation in the northern border of Israel, and those risk factors contained in Evogene's reports filed with the applicable securities authority. In addition, Evogene and its subsidiaries rely, and expect to continue to rely, on third parties to conduct certain activities, such as their field trials and pre-clinical studies, and if these third parties do not successfully carry out their contractual duties, comply with regulatory requirements or meet expected deadlines, Evogene and its subsidiaries may experience significant delays in the conduct of their activities. Evogene and its subsidiaries disclaim any obligation or commitment to update these forward-looking statements to reflect future events or developments or changes in expectations, estimates, projections and assumptions.

Evogene InvestorsRelations Contact:

Email: [email protected]

Tel: +972-8-9311901

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		June 30,			December 31,
		2024			2023
		Unaudited			Audited
CURRENT ASSETS:
Cash and cash equivalents		$	9,484			$	20,772
Short-term bank deposits			11,424				10,291
Trade receivables			376				357
Other receivables and prepaid expenses			3,696				2,973
Inventories			794				76
			25,774				34,469
LONG-TERM ASSETS:
Long-term deposits and other receivables			30				28
Investment accounted for using the equity method			100				-
Right-of-use-assets			729				980
Property, plant and equipment, net			1,650				2,455
Intangible assets, net			12,685				13,169
			15,194				16,632
		$	40,968			$	51,101
CURRENT LIABILITIES:
Trade payables		$	957			$	1,785
Employees and payroll accruals			2,333				2,537
Lease liability			558				853
Liabilities in respect of government grants			681				388
Deferred revenues and other advances			548				362
Other payables			816				1,019
			5,893				6,944
LONG-TERM LIABILITIES:
Lease liability			252				285
Liabilities in respect of government grants			4,247				4,426
Deferred revenues and other advances			244				393
Convertible SAFE			10,392				10,368
			15,135				15,472
SHAREHOLDERS' EQUITY:
Ordinary shares of NIS 0.2 par value: Authorized − 15,000,000 ordinary shares; Issued and outstanding − 5,096,760 shares as of June 30, 2024, and 5,079,313 (*) shares as of December 31, 2023			287				286
Share premium and other capital reserve			269,648				269,353
Accumulated deficit			(266,868	)			(257,586	)
Equity attributable to equity holders of the Company			3,067				12,053
Non-controlling interests			16,873				16,632
Total equity			19,940				28,685
		$	40,968			$	51,101

		Six months ended June 30,			Three months ended June 30,			Year ended December 31,
		2024			2023			2024			2023			2023
		Unaudited			Audited
Revenues		$	5,104			$	1,295			$	914			$	654			$	5,640
Cost of revenues			847				783				537				461				1,692
Gross profit			4,257				512				377				193				3,948
Operating expenses:
Research and development, net			8,817				10,169				4,016				5,369				20,777
Sales and marketing			1,920				1,728				928				928				3,611
General and administrative			3,184				3,312				1,530				1,797				6,068
Other expenses			524				-				5				-				-
Total operating expenses, net			14,445				15,209				6,479				8,094				30,456
Operating loss			(10,188	)			(14,697	)			(6,102	)			(7,901	)			(26,508	)
Financing income			667				699				260				391				1,486
Financing expenses			(288	)			(785	)			(122	)			(247	)			(965	)
Financing income (expenses), net			379				(86	)			138				144				521
Share of loss from equity accounted investment			(20	)			-				(20	)			-				-
Loss before taxes on income			(9,829	)			(14,783	)			(5,984	)			(7,757	)			(25,987	)
Taxes on income (tax benefit)			1				(24	)			1				21				(33	)
Loss		$	(9,830	)		$	(14,759	)		$	(5,985	)		$	(7,778	)		$	(25,954	)
Attributable to:
Equity holders of the Company		$	(9,282	)		$	(13,294	)		$	(5,419	)		$	(7,023	)		$	(23,879	)
Non-controlling interests			(548	)			(1,465	)			(566	)			(755	)			(2,075	)
		$	(9,830	)		$	(14,759	)		$	(5,985	)		$	(7,778	)		$	(25,954	)
Basic and diluted loss per share, attributable to equity holders of the Company (*)		$	(1.82	)		$	(3.18	)		$	(1.06	)		$	(1.68	)		$	(5.20	)
Weighted average number of shares used in computing basic and diluted loss per share (*)			5,087,029				4,177,554				5,090,993				4,185,242				4,589,386

		Six months ended June 30,			Three months ended June 30,			Year ended December 31,
		2024			2023			2024			2023			2023
		Unaudited			Audited
Cash flows from operating activities
Loss		$	(9,830	)		$	(14,759	)		$	(5,985	)		$	(7,778	)		$	(25,954	)
Adjustments to reconcile loss to net cash used in operating activities:
Adjustments to the profit or loss items:
Depreciation			800				807				374				406				1,641
Amortization of intangible assets			484				481				239				241				971
Share-based compensation			999				1,219				460				801				1,877
Revaluation of convertible SAFE			24				220				49				26				254
Net financing expenses (income)			(222	)			6				(28	)			60				(666	)
Loss (gain) from sale of property, plant and equipment			524				(26	)			5				-				(26	)
Share of loss from equity accounted investment			20				-				20				-				-
Taxes on income (tax benefit)			1				(24	)			1				21				(33	)
			2,630				2,683				1,120				1,555				4,018
Changes in asset and liability items:
Decrease (increase) in trade receivables			(19	)			170				163				72				(9	)
Decrease (increase) in other receivables			(725	)			84				(546	)			375				(1,445	)
Decrease (increase) in inventories			(718	)			317				(78	)			342				490
Decrease in deferred taxes			-				-				-				-				94
Increase (decrease) in trade payables			(762	)			26				(77	)			(95	)			742
Increase (decrease) in employees and payroll accruals			(204	)			172				(99	)			117				550
Increase (decrease) in other payables			(214	)			(162	)			(153	)			297				(534	)
Increase (decrease) in deferred revenues and other advances			(84	)			(73	)			(13	)			(81	)			(288	)
			(2,726	)			534				(803	)			1,027				(400	)
Cash received (paid) during the period for:
Interest received			402				283				231				145				905
Interest paid			(41	)			(66	)			(18	)			(30	)			(115	)
Taxes paid			-				(10	)			-				(10	)			(31	)
Net cash used in operating activities		$	(9,565	)		$	(11,335	)		$	(5,455	)		$	(5,091	)		$	(21,577	)

		Six months ended June 30,			Three months ended June 30,			Year ended December 31,
		2024			2023			2024			2023			2023
		Unaudited			Audited
Cash flows from investing activities:
Purchase of property, plant and equipment		$	(172	)			(483	)			(31	)			(124	)		$	(785	)
Proceeds from sale of marketable securities			-				6,924				-				6,287				6,924
Purchase of marketable securities			-				(503	)			-				(503	)			(503	)
Proceeds from sale of property, plant and equipment			10				26				-				-				26
Withdrawal from (investment in) bank deposits, net			(990	)			(13,560	)			3,241				(13,560	)			(10,200	)
Net cash provided by (used in) investing activities		$	(1,152	)		$	(7,596	)		$	3,210			$	(7,900	)		$	(4,538	)
Cash flows from financing activities:
Issuance of a subsidiary preferred shares to non-controlling interests			-				9,523				-				9,523				9,523
Proceeds from issuance of ordinary shares, net of issuance expenses			86				336				83				68				8,449
Repayment of lease liability			(462	)			(413	)			(231	)			(207	)			(836	)
Proceeds from government grants			-				1,089				-				1,063				1,089
Repayment of government grants			(142	)			(35	)			(3	)			-				(73	)
Net cash provided by (used in) financing activities			(518	)			10,500				(151	)			10,447				18,152
Exchange rate differences - cash and cash equivalent balances			(53	)			(316	)			(35	)			(223	)			(245	)
Decrease in cash and cash equivalents			(11,288	)			(8,747	)			(2,431	)			(2,767	)			(8,208	)
Cash and cash equivalents, beginning of the period			20,772				28,980				11,915				23,000				28,980
Cash and cash equivalents, end of the period		$	9,484			$	20,233			$	9,484			$	20,233			$	20,772
Significant non-cash activities
Acquisition of property, plant and equipment		$	15			$	90			$	15			$	21			$	81
Investment in equity-accounted investee with corresponding deferred revenues		$	120			$	-			$	-			$	-			$	-
Increase of right-of-use asset recognized with corresponding lease liability		$	184			$	135			$	54			$	64			$	194