Evogene Ltd. Q3 FY2024 earnings call

• Evogene announced a unique collaboration with Google Cloud to pioneer a generative AI foundation model for novel small molecule design, leveraging its expertise in predictive biology and chemistry along with Google Cloud's AI and machine learning leadership.
• Casterra achieved milestones with reliable seed production infrastructure in Kenya and Brazil, completed growing and harvesting seasons in Brazil, and is in the harvesting season in Africa.
• Lavie Bio expanded Yalos to winter wheat with initial sales and advanced LAV321 to precommercialization, and received a grant from Israel Innovation Authority.
• AgPlenus initiated a new fungicide program focusing on Septoria, verified three proteins as essential in Septoria and identified around 1,000 compounds predicted to be effective.
• Biomica's Phase I clinical study for BMC128 neared completion with positive results in five patients and had a pre-IND meeting with the FDA with positive feedback.
• Evogene has three proprietary AI tech engines (MicroBoost AI, ChemPass AI, GeneRator AI) designed to drive life science product discovery and optimization, and continuously invests in enhancing them.

In the first nine months of 2024, total revenues reached approximately $6.9 million compared to approximately $5.1 million in the first nine months of 2023. In Q3 2024, total revenues reached approximately $1.8 million compared to approximately $3.8 million in Q3 2023. Revenues in Q3 2024 were mainly based on Casterra's seeds sales. For the full year 2024, Evogene anticipates continued revenue growth mainly due to Casterra supply of existing seed orders. Research and development expenses, net of non-refundable grants, for the nine months of 2024 were approximately $13.2 million, a significant decrease from approximately $15.2 million in the first nine months of 2023. Sales and marketing expenses for the first nine months of 2024 were approximately $2.8 million, a slight increase from approximately $2.6 million in the same period in the previous year. General and administrative expenses for the first nine months of 2024 increased to approximately $6.1 million from approximately $4.8 million in the same period of the previous year.

• For the full year 2024, Evogene anticipates continued revenue growth compared to the previous year, mainly due to Casterra supply of existing seed orders.
• Projected cash usage for 2024 without Biomica and Lavie Bio is approximately $8 million to $10 million, a decrease from $12.5 million in 2023.
• Evogene anticipates continued growth in the fourth quarter of 2024 compared to the previous year, mainly based on Casterra's forecast for seed order supply.

• Current war between Israel, Hamas and Hezbollah and any worsening of the situation in Israel, such as further mobilization or escalation in the northern border of Israel may affect actual results.
• Casterra partners were still in internal discussion regarding follow-on orders for 2025 deliveries, causing no material update on such orders during the call.

Q: On the second quarter call, you said you expected a material update on a follow-on order for 2025 deliveries at Casterra by today's call. This did not happen. Why did this not materialize?

A: Hi. This is Ofer speaking thank you, Ben, for joining to this call. Yes, in previous earnings call, we were expected to receive orders from our partners. But to our server, we still didn't receive it. Not because there is a complication. It's mainly because they are still in their internal discussion based on the performance that they are receiving, in their bills. So since we didn't receive the final decision, which we hope that it will receive it, almost every day for now. So this is the reason that we couldn't give such an update for today meetings. But it's not because there is any specific complication in the discussion or the ongoing relationship with our partners.

Q: Have Casterra continued delayed deliveries. Of the initial order placed in mid-2023 compromised its ability to secure a follow on order?

A: With respect to this question. I'm just returning from probably past three days in Kenya. Where we visit our seed production site, together with Yoash, the CEO of Casterra, we published, we reached to a stage that I think that we solved the seed production issue for in Africa. Our partners are quite happy about it. Actually, we are planning to bring some of them to our side, so they can see and impress from what we achieved there. And I believe that we are -- we will continue to stay an important seed suppliers to our, partners in Africa. As we disclosed, there was some delays in the harvesting season because of the extension of the rain in Kenya. But now, we are moving very fast. Probably, we'll put some nice pictures and short movies from our visit in Kenya, which my opinion, are quite impressive. And we are reaching to the stage that we can generate tens and even close to hundreds of tons of seeds on every month. So I think that there we are in a good position, with the future seed supplies to our partners. So, yes, there were some delays, and, yes some seed producer that we engaged in 2023, disappoint us from their performance. But the thing that now we are beyond this complication, and we are looking forward to a much, and better performance futures, with respective seed production.