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Evogene Ltd. Reports Third Quarter 2011 Financial Results


11/22/2011 7:29:20 AM

REHOVOT, ISRAEL--(Marketwire - November 22, 2011) -

Evogene Ltd. (TASE: EVGN) announced today its financial results for the third quarter ended September 30th, 2011.

Ofer Haviv, Evogene's President and CEO, stated, "We are very proud of our continuing achievements under our collaborations with major seed companies. These achievements, such as the recent milestone reached under the collaboration with Bayer CropScience for wheat and the successful completion of the third year of our five-year collaboration with Monsanto, are providing further evidence of Evogene's position as a world leader in discovering genes targeted at improving yield and environmental stress traits. In addition to our activities in these key areas of abiotic stress, we are allocating significant resources to both expanding our plant genomic technologies to address additional challenges in product development, and to leveraging these capabilities into other major commercial areas, where they can provide the basis for successful new products."

Mr. Haviv continued, "With respect to the expansion of our genomic technologies, we believe that the addition of our recently announced Gene2Product™ technology will add significant value to our gene discovery capabilities both in our current areas of focus and in new areas. One such area of focus relates to plant diseases and other biotic stress resistance, as demonstrated by the expansion of our collaborative work with Pioneer Hi-Bred to address rust resistance in soybean, which was announced yesterday."

Mr. Haviv concluded, "We look forward to reporting additional achievements in these and other areas as we further develop and expand our unique company."

Highlights for this quarter with respect to our collaborations include:

  • Expansion of our relationship with Pioneer Hi-Bred, a DuPont Business, addressing important soybean traits, by the signing of a new multiyear collaboration, for improving resistance to soybean rust, one of the most devastating fungal diseases in this important crop.
  • Milestone achievement under our five-year wheat collaboration with Bayer CropScience AG, signed in December 2010, which includes identification of over 200,000 single-nucleotide polymorphisms ("SNP's") in the wheat genome.
  • Joint announcement of the successful completion of the third year of collaboration with Monsanto, covering yield and environmental stress in corn, soybean, cotton and canola.

Revenues for the first nine months of 2011 were $10.2 million, compared to $7.9 million for the same period in 2010. Revenues for the third quarter of 2011 were $3.4 million, compared to $2.6 million for the same period in 2010. At present, revenues consist primarily of research and licensing revenues generated under the company's various collaboration agreements.

Research & Development expenses for the first nine months of 2011 were $4.6 million, compared to $3.7 million for the same period in 2010. Research & Development expenses for the third quarter of 2011 were $2.0 million, compared to $1.5 million for the same period in 2010. These increases mainly relate to the development of the Gene2Product™ computational technology, increased efforts focused on additional traits, mainly biotic tolerance traits, and the biofuel program.

In addition, Cost of Revenues consists primarily of certain research and development expenses allocated to deliverables under our various collaborations. Such Cost of Revenues for the first nine months of 2011 were $5.5 million, compared to $4.2 million for the same period in 2010. Cost of Revenues for the third quarter of 2011 were $2.0 million, compared to $1.5 million for the same period in 2010.

Loss from ordinary operations for the first nine months of 2011 was $2.4 million, compared to loss from ordinary operations of $2.1 million for the same period in 2010. Loss from ordinary operations for the third quarter of 2011 was $1.3 million, compared to loss from ordinary operations of $1.2 million for the same period in 2010.

Financial expenses due to publicly traded warrants: 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 which were exercised by May 31, 2011 (the warrant expiry date). 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 results in non-cash financial income (expense) due to their revaluation on our statements of comprehensive profit or loss.

Total Comprehensive profit for the first nine months of 2011 was $1.6 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 $4.0 million, including $2.2 million of such non-cash financial expenses, for the same period in 2010. Total comprehensive loss for the third quarter of 2011 was $2.3 million, compared to a total comprehensive loss of $3.6 million, which includes $3.1 million of such non-cash financial expenses for the same period in 2010. Also as explained above, these non-cash financial income and/or expense amounts due to publicly traded warrants will not be applicable for future quarterly results.

As of September 30, 2011, Evogene had approximately $60 million in cash and cash equivalents, marketable securities and short-term deposits, compared to approximately $36 million as of December 31, 2010. The September 30, 2011 amount includes $16.6 million from the exercise of the previously outstanding publicly traded warrants and $12 million from an equity investment in the Company by Bayer CropScience pursuant to a wheat collaboration agreement signed in December 2010.

About Evogene

Evogene is a world leading developer of improved plant traits, such as yield and drought tolerance, for a wide diversity of key crops through the use of plant genomics. The company focuses on utilizing its proprietary computational genomic technologies to provide a complete solution for plant trait improvement through combining state of the art biotechnology and advanced breeding methods. Evogene is collaborating with world leading seed companies to introduce its improved plant traits into key commercial crops under milestone and royalty bearing agreements. 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." These statements include words like "may," "expects," "believes," "scheduled" and "intends," and they describe opinions about future events. These forward-looking statements involve known and unknown risks and uncertainties that may cause the actual results, performance or achievements of Evogene Ltd. to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.

CONSOLIDATED BALANCE SHEETS                                                 
----------------------------------------------------------------------------
                                                                            
Dollar in thousands (except per share data)                                 
                                                                            
                                       As of                                
                                    December 31      As of September 30     
                                   ------------  -------------------------- 
                                       2010          2011          2010     
                                      Audited      Unaudited     Unaudited  
                                   ------------  ------------  ------------ 
Current assets                                                              
Cash and cash equivalents                10,120         7,726        10,654 
Marketable securities                    21,229        38,053        23,568 
Short term deposits                       4,500        13,787         1,650 
Account receivables                       2,142         1,280           563 
Other account receivables                   553           732           304 
                                   ------------  ------------  ------------ 
                                         38,544        61,578        36,739 
                                   ------------  ------------  ------------ 
Non-current assets                                                          
Prepaid expenses                             37            49            33 
Property and equipment                    4,120         5,809         3,709 
Intangible assets                           171           145           183 
                                   ------------  ------------  ------------ 
                                          4,328         6,003         3,925 
                                   ------------  ------------  ------------ 
                                                                            
Total Assets                             42,872        67,581        40,664 
                                   ============  ============  ============ 
                                                                            
Current liabilities                                                         
Trade payable                             1,054           998           645 
Liability related to chief                                                  
 scientists grants                          400           487           438 
Deferred revenues                         3,718         4,311         3,700 
Liability related to traded                                                 
 warrants                                 9,199             -         6,478 
Other accounts payable and accruals       1,949         1,651         1,354 
                                   ------------  ------------  ------------ 
                                         16,320         7,447        12,615 
                                   ------------  ------------  ------------ 
Long-term Liabilities                                                       
Liability related to chief                                                  
 scientists grants                        3,499         3,287         3,408 
Deferred revenues                         6,313         5,780         7,154 
Accrued severance pay                         9             9             9 
                                   ------------  ------------  ------------ 
                                          9,821         9,076        10,571 
                                   ------------  ------------  ------------ 
Shareholders' Equity                                                        
Share capital                                82           100            81 
Premium on shares                        49,248        80,498        47,728 
Other capital reserves                    5,938         7,446         5,219 
PUT Option                               (4,433)       (4,433)       (4,433)
Accumulated deficit                     (34,104)      (32,553)      (31,117)
                                   ------------  ------------  ------------ 
                                         16,731        51,058        17,478 
                                   ------------  ------------  ------------ 
                                                                            
Total Liabilities and shareholders'                                         
 equity                                  42,872        67,581        40,664 
                                   ============  ============  ============ 
                                                                            
                                                                            
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME                             
--------------------------------------------------------------------------- 
                                                                            
Dollar in thousands (except per share data)                                 
                                                                            
                   For the                                                  
                    Year       For the period of       For the period of    
                  ended on    three months ended on   nine months ended on  
                 ----------  ----------------------  ---------------------- 
                  December    September   September   September   September 
                   31 2010     30 2011     30 2010     30 2011     30 2010  
                   Audited    Unaudited   Unaudited   Unaudited   Unaudited 
                 ----------  ----------  ----------  ----------  ---------- 
                                                                            
Revenues             12,563       3,352       2,589      10,168       7,905 
                                                                            
Cost of revenues      5,811       1,951       1,486       5,507       4,213 
                 ----------  ----------  ----------  ----------  ---------- 
                                                                            
Gross profit          6,752       1,401       1,103       4,661       3,692 
                 ----------  ----------  ----------  ----------  ---------- 
                                                                            
Operating                                                                   
 expenses:                                                                  
  Research and                                                              
   development        5,544       1,952       1,499       4,642       3,691 
  Business                                                                  
   development        1,062         240         274         727         715 
  General and                                                               
   administrative     2,069         527         506       1,650       1,375 
                 ----------  ----------  ----------  ----------  ---------- 
                                                                            
Loss from                                                                   
 ordinary                                                                   
 operation           (1,923)     (1,318)     (1,176)     (2,358)     (2,089)
                                                                            
Other expenses          (54)         (5)          -          (5)        (54)
Financial income        724         329         789       1,035         614 
Financial                                                                   
 expenses               (10)     (1,308)         (3)       (732)         (7)
Financial income                                                            
 (expenses) due                                                             
 to revaluation                                                             
 of Options          (5,393)          -      (3,126)      3,729      (2,222)
Financial                                                                   
 expenses due to                                                            
 revaluation of                                                             
 obligation to                                                              
 the OCS               (314)        (37)       (109)       (118)       (225)
                 ----------  ----------  ----------  ----------  ---------- 
Net Profit (Loss)    (6,970)     (2,339)     (3,625)      1,551      (3,983)
                 ==========  ==========  ==========  ==========  ========== 
Total                                                                       
 Comprehensive                                                              
 Profit (Loss)       (6,970)     (2,339)     (3,625)      1,551      (3,983)
                 ==========  ==========  ==========  ==========  ========== 
                                                                            
Basic Profit                                                                
 (Loss) per share                                                           
 (in dollar)          (0.24)     (0.074)      (0.12)       0.05       (0.14)
                 ==========  ==========  ==========  ==========  ========== 
                                                                            
Diluted Profit                                                              
 (Loss) per share                                                           
 (in dollar)          (0.24)     (0.074)      (0.12)       0.05       (0.14)
                 ==========  ==========  ==========  ==========  ========== 
                                                                            

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



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