Rehovot, Israel
August 10th, 2011
- Highlights for quarter include development of new Gene2Product technology and infrastructure expansion
- As of end of quarter, Evogene had over $60 million in cash, including approximately $16 million received from exercise of public warrants and $12 million investment by Bayer CropScience
Evogene Ltd. (TASE: EVGN) announced today its financial results for the second quarter ended June 30th, 2011.
Ofer Haviv, Evogene's president and CEO, stated:"2011 has been a year of both execution and expansion. With respect to execution, we are continuing to successfully provide our partners with genomic discoveries under our various collaborations, including agreements with most of the world’s leading seed companies. With respect to expansion, we are substantially enhancing and expanding our infrastructure for the future, in terms of capabilities, people and physical facilities. Furthermore, we are very pleased with Evogene’s current financial stability: as of June 30, 2011, we had over $60 million in cash, representing an increase of more than $25 million during the first half of 2011, including amounts received from the exercise of public warrants and the Bayer CropScience investment.”
Mr. Haviv continued, "An important key component of our expansion is our new Gene2Product technology that focuses the power of our proven industry leading computational genomic capabilities on optimizing trait efficacy and the product development process of novel genes in our partners' pipelines. The first component of the Gene2Product technology, RePack, has been commercially launched, with additional components under development and planned for introduction during the coming months. We are very excited about the potential that this powerful new capability has to substantially improve the probability of success, in terms of both quality of performance and quantity, of biotechnology seed products resulting from industry-wide development efforts."
Revenues for the first six months ended June 30, 2011 were $6.8 million representing an increase of approximately 28% compared to $5.3 million for the same period in 2010. Revenues for the second quarter of 2011 were $3.4 million, representing an increase of approximately 30% compared to $2.6 million reported for the same period in 2010. Revenues for the first half and the second quarter of 2011 consist of research and licensing revenues generated under the company's various collaboration agreements with seed companies.
Research & Development expenses for the first six months ended June 30, 2011 were $2.7, compared to $2.2 million for the same period in 2010. Research & Development expenses for the second quarter of 2011 were $1.5 million, compared to $1.3 million reported for the same period in 2010. These increases mainly relate to the development of the Gene2Product computational genomic technologies and increased efforts focused on additional traits, mainly biotic tolerance traits.
Loss from ordinary operations for the first six months of 2011 was $1 million, compared to loss from ordinary operations of $0.9 million in the same period in 2010. Loss from ordinary operations for the second quarter of 2011 was $0.6 million, compared to loss from ordinary operations of $0.7 million in 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. This will not be applicable for future quarterly results.
Comprehensive profit for the first six months ended June 30, 2011, was $3.9 million, which includes $3.7 million of non-cash financial revenues due to previously outstanding publicly traded warrants, as described above, compared to a total comprehensive loss of $0.4 million, including $0.9 million of non-cash financial revenues for the same period in 2010. Comprehensive profit for the second quarter of 2011 was $2.8 million, which includes $2.7 million of non-cash financial revenues, compared to a comprehensive profit of $3.4 million, including $4.5 million of such non-cash financial revenues for the same period in 2010.
As of June 30, 2011, Evogene had $61.0 million in cash, cash equivalents, cash deposits and short-term marketable securities, compared to $35.8 million as of December 31, 2010. The June 30, 2011 amount includes $16.6 million from the exercise of the publicly traded warrants (including $13 million received in the second quarter of 2011) and $12 million from an equity investment in the Company by Bayer CropScience pursuant to a wheat collaboration agreement signed in December 2010.
The Gene2Product technology consists of a number of computational genomic components, under development by Evogene, to improve the probability of successful development of biotechnology seed products. Utilization of Gene2Product is complimentary and additive to use of ATHLETE for gene discovery. The aim of Gene2Product is to improve trait efficacy through optimizing gene 'mode of use' in the pipelines of seed companies utilizing computational genomics and includes the following components: RePack to improve trait efficacy by optimization of gene regulation; PlaNet to improve trait efficacy by multiple gene stacking; GeneDex to improve trait efficacy through genes stable to different environments and genetic backgrounds; and GeneSpec to improve trait efficacy by selecting the preferred allele for each gene.
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