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Dr. Gengchen Han, Origin Agritech's Chairman and CEO, discusses strategic directions of new Origin Agritech at an investor meeting


Beijing, China
June 16, 2015

Origin Agritech Limited (NASDAQ GS: SEED) ("Origin", or the "Company"), a technology-focused supplier of crop seeds in China, today announced that Dr. Gengchen Han, Chairman and CEO of Origin, met with investors at a meeting organized by Wells Fargo Securities and discussed the strategic directions of new Origin Agritech on June 16th, 2015. During his presentation, Dr. Han announced that Origin has successfully transitioned from a traditional seed company to a biotechnology seed company after more than 10 years of agri-biotech developments. This is marked by the successful development of our biotech seed product pipelines, especially the new technology of stacked traits of glyphosate tolerance (GT) and insect resistance (Bt).

With the transformation to new Origin Agritech, the Company is now organized into a simple structure of two fundamental business lines: agri-biotech and product develop under State Harvest and seed production and distribution under Beijing Origin. State Harvest is now in the position to introduce to the seed market its first generation phytase transgenic corn, second generation glyphosate tolerance corn seed, and its new technology of stacked traits of GT and Bt genes. While waiting for the approval for commercial planting in China, State Harvest is ready to introduce these agri-biotech products into the global seed market. In addition, State Harvest has also built a solid capacity for breeding technologies, including marker-assisted breeding and doubled haploids technologies, which along with its rich germplasm resources, will allow State Harvest to become an important global seed technology company. 

Beijing Origin will focus on our seed production and distribution business in China. After recent restructurings, Beijing Origin's corn seed business now represents over 85% of the revenues in Beijing Origin, and we believe it has a strong potential to generate EBITDA of over RMB100 million. Beijing Origin's broad product lines across all major planting regions in China and innovative distribution network are the cornerstones for its leadership position in China. Its state-of-the-art corn seed production and conditioning facilities in Gansu and Xinjiang provinces provide superior quality products to the farmers in China and they are the growth engine for Beijing Origin.

During the meeting today, Dr. Han also discussed the Company's current business performance and financial conditions. Dr. Han pointed out that we should see a significant year-over-year improvement in the income from operations during the fiscal year 2015, despite continuous challenges due to industry oversupply. On the balance sheet, Dr. Han discussed the inventory adjustment during both 2014 and 2015 planting seasons, which could improve our operating cash flow significantly this and next year. In addition, the company is expected to have minimal needs in CAPEX during the next couple of years as our new state-of-the-art facility in Xinjiang province allows us to double our corn seed revenues. 

"As Origin Agritech is celebrating its eighteenth anniversary, we are excited to launch our new strategies and move to the new stage for Origin Agritech", said Dr. Han in the meeting, "we believe the earnings potential of Beijing Origin could demonstrate the value of Origin's fundamental seed production and distribution businesses while our new global strategy for State Harvest's agri-biotech and product development businesses could move Origin to the global market and allows Origin to become a global player in the biotech seed business."

The presentation materials used in today's meeting have been filed with SEC on June 15, 2015. 



More news from: Origin Agritech Ltd.


Website: http://www.originagritech.com

Published: June 17, 2015

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