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Evogene Ltd. Reports Fourth Quarter and Year End 2011 Financial Results



3/20/2012 9:09:24 AM

REHOVOT, ISRAEL--(Marketwire - March 20, 2012) -

Evogene Ltd. (TASE: EVGN) announced today its financial results for the fourth quarter and year ended December 31, 2011.

Ofer Haviv, Evogene's president and CEO, stated: "During the past year, we were pleased to see key achievements and continued growth in all four current fields of Evogene focus, each of which strongly relies on our unique and proprietary plant genomics technologies and capabilities." Mr. Haviv continued, "With respect to these focus areas, first and foremost, we enhanced our world leading position in the field of improved yield and abiotic stress tolerance traits for key agricultural crops, and continued to provide our partners with genomic discoveries under existing, new and expanded collaborations. Second, in the field of disease and other biotic stress resistance traits, we significantly increased our activities with a new multi-year agreement. Thirdly, having demonstrated economic viability, we created a wholly owned subsidiary to consolidate and expand our activities related to development of non-food feedstock for biofuels. And in our fourth and most recent focus area, agro-chemicals, we are completing a strategic plan for leveraging our technologies and see opportunities for us to develop products for this very substantial industry."

Mr. Haviv concluded, "In order to accomplish these goals and to provide for future corporate growth, during the past two years, we more than doubled our professional team and substantially expanded our facilities to create one of the world's largest gene discovery infrastructures. It is important to note that, while accomplishing all of this, most of which relates to potential future revenues and profits, we continued to substantially strengthen our financial base with increased revenues and other cash sources, and ended the year with $59 million in cash resources."

Highlights during the year included:

  • Early extension of the collaboration with Monsanto Company, focused on identifying key plant genes related to yield, environmental stress and fertilizer utilization in corn, soybean, cotton and canola. The collaboration was extended in an additional year and includes Evogene's Gene2Product™ computational technologies. This extension follows successful completion of the collaboration's third year out of the originally five year program, initiated in 2008.
  • Multiyear collaboration with DuPont to improve resistance to soybean rust, one of the most devastating fungal diseases in soybean. This collaboration further builds on an on-going partnership between the companies, for improving drought tolerance in corn and soybean.
  • Milestone achievement in wheat collaboration with Bayer CropScience AG, signed on December 2010, which utilizes Evogene's ATHLETE™ and EvoBreed™ computational technologies. Under this milestone, over 200,000 wheat SNPs were identified as part of the companies' efforts to introduce improved wheat varieties.
  • Advancement of Evogene's yield and drought tolerance corn trait by Biogemma (from the Limagrain Group) to the next phase of development -- Phase II.
  • Establishment of Evofuel, a wholly owned subsidiary that focuses on development and commercialization of second-generation feedstock for biofuel. This year we also announced expansion of our agreement with SLC Agricola in Brazil for the development of castor bean seeds as a cost competitive feedstock for biofuels.
  • Establishment of a dedicated team to design a road-map for implementing our genomic technologies and plant science to develop innovative chemicals for agriculture.
  • Expansion of the company's R&D facilities, including laboratories and greenhouse facilities, totaling $4.4 million. This expansion is aimed at increasing the company's plant validation & growth efficiency and capacity by over 50%.
  • Increase of 30% in the company's personnel, mainly driven by appointment of new plant researchers and computational genomics personnel.
  • As of December 31, 2011, Evogene had approximately $59 million in cash, cash equivalents, cash deposits and short-term marketable securities. This includes approximately $16.6 million from the exercise in May 2011 of the then outstanding publicly traded warrants and $12 million from an equity investment made on January 2011 by Bayer CropScience AG pursuant to the wheat collaboration agreement.

Revenues for 2011 were approximately $15 million, compared to $12.6 million for the same period in 2010, representing revenues growth of approximately 19%. Revenues for the fourth quarter of 2011 were $4.7 million, approximately equal to the same period for 2010. At present, revenues consist primarily of research and licensing revenues generated under the company's various collaboration agreements with seed companies.

Cost of Revenues include expenses related to support of our on-going activities under our collaborations with seed companies, each of which provides for future milestone and royalties revenues. Cost of Revenues for 2011 was $8.2 million, compared with $5.8 million for the same period in 2010. Cost of Revenues expenses for the fourth quarter of 2011 were $2.7 million, compared with $1.6 million for the same period in 2010. These increases in Cost of Revenues primarily relate to the addition of the collaboration agreements with Bayer CropScience, signed on December 2010, and the extension of our collaboration with Monsanto.

Research & Development expenses for 2011, which do not include expenses incurred in support of on-going collaborations which, as stated above, are accounted for as Cost of Revenues, were $6.4 million, compared with $5.5 million for the same period in 2010. Research & Development expenses for the fourth quarter of 2011 were $1.7 million, compared with $1.9 million for the same period in 2010. These increases in Research & Development expenses for the year 2011 mainly related to development of new genomic technologies, including Gene2Product™, and to support our biofuel activity.

Loss from ordinary operations for 2011 was $3.2 million, compared to a loss from ordinary operations of $1.9 million for the same period in 2010. Loss from ordinary operations for the fourth quarter of 2011 was $0.8 million, compared to a profit from ordinary operations of $0.2 million for the same period in 2010.

Financial expenses due to publicly traded warrants: During the first half of 2011, Evogene had approximately 4.5 million publicly traded warrants outstanding, which were issued as part of its IPO on the Tel Aviv Stock Exchange in May 2007. 99.9% of these warrants were exercised by May 31, 2011, their date of expiration. While these warrants were outstanding, any change as of the end of a reporting period in the market price of the Company's ordinary shares resulted in non-cash financial income/expense due to their revaluation on our statements of comprehensive profit or loss. These non-cash financial income/expense due to publicly traded warrants were no longer applicable after the second quarter of 2011.

Total Comprehensive profit for 2011 was $0.6 million, which includes $3.7 million of non-cash financial income due to publicly traded warrants, as described above, compared to a total comprehensive loss of $7.0 million, including $5.4 million of such non-cash financial expenses for the same period in 2010. Total comprehensive loss for the fourth quarter of 2011 was $0.9 million, compared to a comprehensive loss of $3.0 million for the same period in 2010. Total comprehensive loss for the fourth quarter of 2011 does not include any non-cash financial affects due to exercise of most of the publicly traded warrants as stated above, while the comprehensive loss for the fourth quarter of 2010 includes $3.2 million of such non-cash financial revenues.

As of December 31, 2011, Evogene had approximately $59 million in cash, cash equivalents, cash deposits and short-term marketable securities, compared to approximately $35.8 million as of December 31, 2010.

About Evogene
Evogene is a world leading developer of improved plant traits for a wide diversity of key crops through the use of plant genomics. The company focuses on utilizing its proprietary computational genomic technologies and plant science to provide a complete solution for improving key plant traits, including yield, abiotic stress tolerance, such as drought, and abiotic stress, such as disease resistance. Evogene is collaborating with world leading seed companies to introduce its products into key commercial crops under milestone and royalty bearing agreements. Evogene's wholly owned subsidiary, Evofuel, is engaged in utilizing Evogene's expertise to develop and commercialize seeds of non-food feedstock for biofuel. Evogene's headquarters are in Rehovot, Israel, and its stock is traded on the Tel Aviv Stock Exchange (TASE: EVGN). For additional information, please visit Evogene's website at www.evogene.com.

This press release contains "forward-looking statements" relating to future events. These statements may be identified by words such as "may," "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 Israeli 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.

                                                                            
                                                                            
BALANCE SHEETS                                                              
                                                                            
                                                     As of         As of    
Dollar in thousands (except per share data)       December 31   December 31 
                                                 ------------  ------------ 
                                                     2011          2010     
                                                    Audited       Audited   
                                                 ------------  ------------ 
Current assets                                                              
Cash and cash equivalents                               6,465        10,120 
Marketable securities                                  34,672        21,229 
Short term deposits                                    17,652         4,500 
Receivables                                               800         2,142 
Other receivables                                         981           553 
                                                 ------------  ------------ 
                                                       60,570        38,544 
                                                 ------------  ------------ 
Non-current assets                                                          
Long term deposits                                         48            37 
Property, plant and equipment                           7,138         4,120 
Intangible assets                                         134           171 
                                                 ------------  ------------ 
                                                        7,320         4,328 
                                                 ------------  ------------ 
                                                                            
                                                       67,890        42,872 
                                                 ============  ============ 
                                                                            
Current liabilities                                                         
Liabilities in respect of grants from the Chief                             
 Scientist                                                905           400 
Deferred revenues                                       4,037         3,718 
Trade payables                                          2,059         1,054 
Options                                                     -         9,199 
Other payables                                          2,079         1,949 
                                                 ------------  ------------ 
                                                        9,080        16,320 
                                                 ------------  ------------ 
Non-current Liabilities                                                     
Liabilities in respect of grants from the Chief                             
 Scientist                                              3,039         3,499 
Deferred revenues                                       7,673         6,313 
Employee benefit liabilities                                9             9 
                                                 ------------  ------------ 
                                                       10,721         9,821 
                                                 ------------  ------------ 
Equity                                                                      
Share capital                                             100            82 
Share premium and reserves, net                        81,448        50,753 
Accumulated deficit                                   (33,459)      (34,104)
                                                 ------------  ------------ 
                                                       48,089        16,731 
                                                 ------------  ------------ 
                                                                            
                                                       67,890        42,872 
                                                 ============  ============ 
                                                                            
                                                                            
STATEMENTS OF COMPREHENSIVE INCOME                                          
                                                                            
Dollar in thousands (except per share data)                                 
                                                                            
                                             For the Year ended December 31 
                                            ------------------------------- 
                                               2011       2010       2009   
                                            ---------  ---------  --------- 
                                                        Audited             
                                            ------------------------------- 
                                                                            
Revenues                                       14,901     12,563      9,993 
                                                                            
Cost of revenues                                8,247      5,811      4,962 
                                            ---------  ---------  --------- 
                                                                            
Gross profit                                    6,654      6,752      5,031 
                                            ---------  ---------  --------- 
                                                                            
                                                                            
Research and development expenses               6,384      5,544      2,569 
Business development expenses                   1,136      1,062        739 
General and administrative expenses             2,313      2,069      1,457 
                                            ---------  ---------  --------- 
                                                                            
Profit (Loss) from ordinary operation          (3,179)    (1,923)       266 
                                                                            
Financial income                                1,294        724      1,402 
Financial expenses                             (1,039)       (10)       (54)
                                                                            
Financial expenses due to revaluation of                                    
 options                                        3,729     (5,393)    (4,814)
Financial expenses due to revaluation of                                    
 obligation to the OCS                           (156)      (314)      (217)
Other (expenses) income                            (4)       (54)        54 
                                                                            
Share of losses of an associate company             -          -        (46)
                                            ---------  ---------  --------- 
                                                                            
Net Profit (loss)                                 645     (6,970)    (3,409)
                                            ---------  ---------  --------- 
                                                                            
Total Comprehensive Profit (loss)                 645     (6,970)    (3,409)
                                            =========  =========  ========= 
                                                                            
Basic Profit (loss) per share (in dollar)        0.02      (0.24)     (0.13)
                                            =========  =========  ========= 

Contact Information
Evogene:
Liat Cinamon
Director of IR & PR
E-mail: Email Contact
Tel: +972-8-931-1933


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