Evogene Reports Second Quarter of 2019 Financial Results
REHOVOT, Israel, July 31, 2019 /PRNewswire/ -- Evogene Ltd. (NASDAQ: EVGN) (TASE: EVGN), a leading biotechnology company developing novel products for life science markets, announced today its financial results for the second quarter ending June 30, 2019.
https://mma.prnewswire.com/media/890385/Evogene_Logo.jpg
Ofer Haviv, Evogene's President and CEO, stated: "During the first half of 2019 we completed the transition to our new corporate structure consisting of Evogene as a technology hub for multiple subsidiaries in different life-science markets. This corporate structure provides the subsidiaries with support from Evogene, to allow the subsidiaries to focus on building valuable assets and fast-tracking their product development towards commercialization. Evogene's support to its subsidiaries can be attributed to three main areas:
-- Access to the CPB platform- right to use the CPB platform by each
subsidiary for its dedicated area of activity, to (i) advance
subsidiaries' current product pipelines, (ii) to expand the
subsidiaries' product pipeline.
-- Corporate and infrastructure support - (i) the subsidiaries' management
works closely with Evogene's board, management, and advisors to benefit
from their broad experience & access to industry network, (ii) Evogene
provides access to its facilities and infrastructure including labs,
greenhouses, and other.
-- Funding - Evogene intends to leverage its strong financial position to
financially support its subsidiaries until a point of maturity, wherein
enough valuable assets have been created to warrant an attractive
valuation at fundraising, or through the generation of revenues from
sales or collaborations to cover expenses. Evogene aims to remain a
major shareholder in its subsidiaries following external fundraising in
order to maintain, for Evogene shareholders, a significant share of the
subsidiaries' future profits and/or market value.
Evogene and its subsidiaries are fully committed to achieving the milestones presented in Evogene's updated corporate presentation filed today." - Mr. Haviv concluded
Recent Developments:
-- Lavie Bio announced positive 2(nd) year field results in its
bio-stimulant program for wheat with product candidates showing repeated
significant yield improvement in spring wheat field trials across
multiple locations, varieties and conditions.
-- Amendment of Evogene's collaboration agreement with Bayer[1] to include
genome editing targets following positive results in corn stalk rot
fungal disease control. Evogene will use its CPB platform to identify
the required edits to improve disease resistance in corn, focusing on
altering gene expression or function. Any promising targets would be
pursued by Bayer's in-house team for validation.
-- Evogene and certain subsidiary management have initiated a process to
evaluate fundraising activities as the opportunities arise.
Consolidated financial results for the period ending June 30, 2019:
Cash position: As of June 30, 2019, Evogene had approximately $46 million in cash, short-term bank deposits and marketable securities, representing a net cash usage of approximately $8.7 million during the first half of 2019 and $4.2 million during the second quarter of 2019.
Assuming that no external financial resources are secured, such as through new collaborations or external fund raising, the Company continues to estimate that its net cash usage in 2019 will be in the range of $16 to $18 million dollars.
Evogene's consolidated cash use is mostly appropriated to its subsidiaries, mainly Lavie Bio, AgPlenus, and Biomica, with funds also used for the establishment of infrastructure and greenhouses for Canonic.
The Company does not have bank debts.
Revenues primarily consist of research and development payments. These revenues represent R&D cost reimbursement and milestone payments under our various collaboration agreements. The majority of these agreements also provide for royalties or other forms of revenue sharing from successfully developed products.
Gross profit for the first half of 2019 was approximately $0.4 million in comparison to approximately $0.2 million for the first half of 2018. Gross profit for the second quarter of 2019 remained stable at approximately $0.1 million in comparison to the second quarter of 2018.
R&D expenses for the first half of 2019 remained stable at approximately $7 million in comparison to the first half of 2018. R&D expenses for the second quarter of 2019 remained stable at approximately $3.5 million in comparison to the second quarter of 2018. R&D expenses mostly represent product development activities of the Company and its subsidiaries, which include field trials and pre-clinical studies provided by third parties. Evogene's consolidated R&D expenses were mostly attributed to its subsidiaries, mainly Lavie Bio, AgPlenus, and Biomica, and to its seed division activity.
Operating loss for the first half of 2019 was approximately $9.4 million in comparison to approximately $9.6 million in the first half of 2018. Operating loss for the second quarter of 2019 remained stable at approximately $4.7 million in comparison to the second quarter of 2018.
Net financing income for the first half of 2019 was approximately $1.5 million in comparison to net financing expenses of approximately $0.5 million in the first half of 2018. Net financing income for the second quarter of 2019 was approximately $0.6 million in comparison to net financing expenses of approximately $0.1 million in the second quarter of 2018. This increase in the first half of 2019 is mainly due to translation of Israeli Shekel nominated cash and marketable securities to US Dollars, revaluation of the Company's marketable securities and interest income on bank deposits.
Loss for the first half of 2019 decreased to approximately to $7.9 million in comparison to a loss of $10.1 million during first half of 2018. Loss for the second quarter of 2019 decreased to approximately to $4.1 million in comparison to a loss of $4.8 million during second quarter of 2018.
Conference Call & Webcast Details:
Evogene's management will host a conference call today, the 31(st) of July 2019, to discuss the results at 09:00 AM Eastern time, 16:00 Israel time. To access the conference call, please dial 1-888-668-9141 toll free from the United States, or +972-3-918-0609 internationally. Access to the call will also be available via live webcast through the Company's website at www.evogene.com.
A replay of the conference call will be available approximately three hours following the completion of the call. To access the replay, please dial 1-888-326-9310 toll free from the United States, or +972-3-925-5904 internationally. The replay will be accessible through August 2, 2019, and an archive of the webcast will be available on the Company's website through August 11, 2019.
About Evogene Ltd.:
Evogene (NASDAQ, TASE: EVGN) is a leading biotechnology company developing novel products for major life science markets through the use of a unique computational predictive biology (CPB) platform incorporating deep scientific understandings and advanced computational technologies.
Today, this platform is utilized by the Company to discover and develop innovative products in the following areas (via subsidiaries or divisions): ag-chemicals, ag-biologicals, seed traits, integrated castor oil ag-solutions, human microbiome-based therapeutics and medical cannabis. Each subsidiary or division establishes its product pipeline and go-to-market, as demonstrated in its collaborations with world-leading companies such as BASF, Bayer, Corteva and ICL. 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", "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 are 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.
[1]Originally with Monsanto, which was acquired by Bayer
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
---
U.S. dollars in thousands (except share and per share data)
June 30,
December 31,
2019 2018
Unaudited
Audited
CURRENT ASSETS:
Cash and cash equivalents $14,097 $5,810
Marketable securities 9,088 26,065
Short-term bank deposits 22,592 22,592
Trade receivables 147 160
Other receivables and prepaid expenses 1,871 861
47,795 55,488
LONG-TERM ASSETS:
Long-term deposits 19
Operating lease right-of-use-assets 3,206
Property, plant and equipment, net 2,453 3,187
5,659 3,206
$53,454 $58,694
CURRENT LIABILITIES:
Trade payables $748 $1,015
Employees and payroll accruals 1,735 2,095
Operating lease liability 716
Liabilities in respect of government grants 457 988
Deferred revenues and other advances 238 412
Other payables 819 921
4,713 5,431
LONG-TERM LIABILITIES:
Operating lease liability 2,638
Liabilities in respect of government grants 3,209 2,898
Deferred revenues and other advances 9 28
Severance pay liability, net 27 31
5,883 2,957
SHAREHOLDERS' EQUITY:
Ordinary shares of NIS 0.02 par value: 142 142
Authorized -150,000,000 ordinary shares;
Issued and outstanding -25,754,297 at June
30, 2019 and December 31, 2018, respectively
Share premium and other capital reserve 188,039 187,701
Accumulated deficit (145,593) (137,790)
Equity attributable to equity holders of the
Company 42,588 50,053
Non-controlling interests 270 253
Total equity 42,858 50,306
$53,454 $58,694
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS
---
U.S. dollars in thousands (except share and per share data)
Six months ended Three months ended
Year ended
June 30, June 30,
December 31,
2019 2018 2019 2018 2018
Unaudited
Audited
Revenues $540 $745 $192 $379 $1,747
Cost of revenues 172 549 101 265 1,452
Gross profit 368 196 91 114 295
Operating expenses:
Research and development, net 7,024 6,945 3,480 3,460 14,686
Business development 970 1,084 477 486 2,084
General and administrative 1,746 1,786 837 841 3,514
Total operating expenses 9,740 9,815 4,794 4,787 20,284
Operating loss (9,372) (9,619) (4,703) (4,673) (19,989)
Financing income 1,870 868 671 335 1,413
Financing expenses (390) (1,388) (108) (418) (2,206)
Financing income (expenses), net 1,480 (520) 563 (83) (793)
Loss before taxes on income (7,892) (10,139) (4,140) (4,756) (20,782)
Taxes on income 3 16 1 13 30
Loss $(7,895) $(10,155) $(4,141) $(4,769) $(20,812)
Attributable to:
Equity holders of the Company $(7,803) $(4,094) $(20,758)
Non-controlling interests (92) (47) (54)
$(7,895) $(4,141) $(20,812)
Basic and diluted loss per
share, attributable to equity
holders of the Company $(0.31) $(0.39) $(0.16) $(0.19) $(0.81)
Weighted average number of
shares used in computing basic
and diluted loss per share 25,754,297 25,752,505 25,754,297 25,752,505 25,753,411
CONSOLIDATED STATEMENTS OF CASH FLOWS
---
U.S. dollars in thousands
Six months ended Three months ended
Year ended
June 30, June 30,
December 31,
2019 2018 2019 2018 2018
Unaudited
Audited
Cash flows from operating
activities
---
Loss $(7,895) $(10,155) $(4,141) $(4,769) $(20,812)
Adjustments to reconcile
loss to net cash used in
operating activities:
Adjustments to the profit or
loss items:
Depreciation 1,315 1,001 677 505 2,020
Share-based compensation 447 721 244 375 1,731
Net financing expense
(income) (1,619) 497 (608) 86 694
Taxes on income 3 16 1 13 30
146 2,235 314 979 4,475
Changes in asset and
liability items:
Decrease (increase) in trade
receivables 13 3 (109) 60 (28)
Decrease (increase) in other
receivables (656) (752) 102 (130) 95
Increase in long-term
deposits (2) (2)
Increase (decrease) in trade
payables (261) (104) 57 126 (114)
Increase (decrease) in
employees and payroll
accruals (360) (313) 45 (182)
Increase (decrease) in other
payables (80) (192) (26) 84 233
Decrease in severance pay
liability, net (4) (5)
Increase (decrease) in
deferred revenues and other
advances (193) 256 (135) 86 (165)
(1,541) (1,104) (71) 224 (161)
Cash received (paid) during
the period for:
Interest received 55 821 21 288 1,360
Taxes paid (3) (17) (3) (10) (23)
Net cash used in operating
activities (9,238) (8,220) (3,880) (3,288) (15,161)
CONSOLIDATED STATEMENTS OF CASH FLOWS
---
U.S. dollars in thousands
Six months ended Three months ended Year ended
June 30, June 30, December 31,
2019 2018 2019 2018 2018
Unaudited Audited
Cash flows from investing
activities:
---
Purchase of property,
plant and equipment $(197) $(153) $(114) $(105) $(374)
Proceeds from sale of
marketable securities 19,994 21,097 13,765 13,875 63,639
Purchase of marketable
securities (1,637) (3,155) (1,637) (951) (31,700)
Proceeds from (investment
in) bank deposits, net 1,880 (14,212)
Net cash provided by
investing activities 18,160 19,669 12,014 12,819 17,353
Cash flows from financing
activities:
---
Proceeds from exercise of
options 9 9
Proceeds from government
grants 287 153 90 96 354
Repayment of operating
lease liability (504) (270)
Repayment of government
grants (575) (44) (546) (66)
Net cash provided by
(used in) financing
activities (792) 118 (726) 96 297
Exchange rate differences
-cash and cash
equivalent balances 157 (271) 101 (249) (114)
Increase in cash and cash
equivalents 8,287 11,296 7,509 9,378 2,375
Cash and cash
equivalents, beginning
of the period 5,810 3,435 6,588 5,353 3,435
Cash and cash
equivalents, end of the
period $14,097 $14,731 $14,097 $14,731 $5,810
Significant non-cash
activities
---
Acquisition of property,
plant and equipment $52 $81 $52 $81 $80
Evogene Investor Contact
:
US Investor Relations:
Nir Zalik
Vivian Cervantes
IR Director
PCG Investor Relations
IR@evogene.com
vivian@pcgadvisory.com
972-8-931-1900
646-863-6274
View original content:http://www.prnewswire.com/news-releases/evogene-reports-second-quarter-of-2019-financial-results-300893834.html
SOURCE Evogene
