THOUSAND OAKS, Calif., Jan. 13, 2015 /PRNewswire/ -- Ceres, Inc. (Nasdaq: CERE), an agricultural biotechnology company, announced today financial results for the three months ended November 30, 2014 and provided an update on its business.
The company reported progress across a number of market opportunities for its breeding and genetic technologies, including sorghum seed and biotech traits. In Brazil, plantings of the company's sorghum hybrids for the 2014-2015 sorghum growing season have been largely completed with more than 50 customers, including mills and mill suppliers.
The company also reported last week favorable results from its biotech corn evaluations in China, where a second year of field trials demonstrated double-digit percentage yield advantages under normal and drought conditions. Corn provides an additional out-licensing opportunity for traits that Ceres is developing for use in sorghum and other crops.
"We have made key progress across our business and product development pipeline and are reaching an exciting point in the commercial roll-out of our products," said Ceres President and CEO Richard Hamilton. "We continue to align our business with areas of the market that provide the most encouraging and near-term growth opportunities."
Ceres Chief Financial Officer Paul Kuc reported that the company has a number of upcoming milestones, including seeds sales in the U.S. forage market, the roll-out of its Persephone bioinformatics software and the continued advancement of traits for crops like corn and sugarcane. "While lower oil prices have created a more challenging environment for bioenergy, we have a number of market opportunities that are being driven by global prosperity trends separate from energy commodity cycles, such as increasing consumption of meat, dairy and sugar, as well as a growing market for bioinformatics software solutions in the life sciences. The extent to which we achieve these milestones should indicate which areas have the greatest momentum, and where we will prioritize our working capital," said Kuc.
Business Highlights and Outlook
-- For the 2014-2015 growing season in Brazil, total plantings of the
company's sorghum products cover more than 4,000 hectares compared to
approximately 1,000 hectares planted the previous season. The increase
in planted area is due primarily to increased demand for high biomass
sorghum for power generation. Following a dry start to the growing
season, which delayed some plantings, growing conditions have been
generally favorable to date across most evaluation regions, including
adequate rainfall. Overall plantings were lower than the company's
original forecast of 5,000 hectares due to some weather delays at the
beginning of the season, which provided less time to plant, and the
company's subsequent decision not to plant outside its recommended
timeframe.
-- In Brazil, Ceres has received a permit to evaluate its biotech traits in
sorghum from the National Technical Commission of Biosafety, or CTNBio,
the Brazilian government's commission that regulates biotechnology crop
traits. Field evaluations of these traits are planned for later this
year.
-- Ceres reported last week that its multi-gene combinations in corn
achieved an approximately 25% yield advantage over controls in many of
its research-scale field evaluations. Field evaluations represent a
critical stage in the development of biotech crop traits, as they
provide greater insight into how traits may perform in an agricultural
setting. Favorable results from a research setting are not a guarantee
of future commercial performance, and further evaluations will be
necessary to confirm results. The company has selected its best
multi-gene combinations for broader field evaluations in 2015.
First Quarter Financial Results
Total revenues for the quarter ended November 30, 2014 were $0.4 million compared to $0.8 million for the quarter ended November 30, 2013. Collaborative research and government grant revenue decreased by $0.3 million primarily due to the completion of work scheduled under various grants and collaborations. The company expects to recognize the majority of product revenues for the 2014-2015 season in Brazil during its fiscal third and fourth quarters, when harvests are completed.
Total cost and operating expenses decreased by $2.6 million to $6.4 million for the quarter ended November 30, 2014 compared to the same period last year.
Cost of product sales decreased by $0.9 million to $0.4 million for the quarter ended November 30, 2014 compared to the same period last year. The decrease was primarily due to reduced operating expenses of $0.5 million and reduced personnel and related expenses in the U.S. of $0.4 million.
Research and development expenses decreased by $1.9 million to $2.5 million for the quarter ended November 30, 2014 compared to the same period last year. In the U.S., research and development expenses decreased by $1.4 million primarily due to reduced personnel and related expenses as well as reduced external research and development expenses. In Brazil, research and development expenses decreased by $0.5 million primarily due to reduced personnel and related expenses, and from a reduction in the number of research trials being conducted.
Selling, general and administrative expenses increased by $0.2 million to $3.4 million for the quarter ended November 30, 2014 compared to the same period last year. The increase was primarily due to increased personnel and related expenses in Brazil.
For the quarter ended November 30, 2014, Ceres reported a net loss of $6.0 million, or $0.12 per share, compared to a net loss of $8.2 million, or $0.33 per share, for the quarter ended November 30, 2013.
At November 30, 2014, cash and cash equivalents and marketable securities totaled $21.6 million.
Conference Call and Webcast Information
Ceres has scheduled a conference call for 4:30 p.m. EST (1:30 p.m. PST) today to discuss its fiscal first quarter results and to provide an update on its business. To access the webcast of the conference call, go to investor.ceres.net. Audio of the teleconference is also available by dialing (877) 838-4153 (domestic) or +1(720) 545-0037 (international). The conference ID number is 55267512. An audio replay of the call will be available two hours after the conclusion of the live call, and remain available on the Ceres website for 30 days.
About Ceres
Ceres, Inc. is an agricultural biotechnology company that develops and markets seeds to produce crops for bioenergy and other markets that utilize plant biomass. The company combines advanced plant breeding and biotechnology to develop hybrids that can address the limitations of first-generation bioenergy feedstocks. These technology platforms, which can increase crop productivity, improve quality, reduce crop inputs and improve cultivation on marginal land, have broad application across multiple crops, including food, feed, fiber and fuel crops. Ceres markets its seed products under its Blade brand. The company also licenses its biotech traits and technology, including its Persephone genome visualization software, to other organizations.
Ceres Forward-Looking Statements
This press release may contain forward-looking statements. All statements, other than statements of historical facts, including statements regarding Ceres' efforts to develop and commercialize its products, anticipated yields and product performance, status of crop plantings, short-term and long-term business strategies, market and industry expectations, future operating metrics, and future results of operations and financial position, including anticipated cost savings from the company's plan to align expenditures and projected cash expenditures, are forward-looking statements. You should not place undue reliance on these forward-looking statements because they involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond Ceres' control. Factors that could materially affect actual results can be found in Ceres' filings with the U.S. Securities and Exchange Commission. Ceres undertakes no obligation to update publicly, except to the extent required by law, any forward-looking statements for any reason after the date the company issues this press release to conform these statements to actual results or to changes in the company's expectations.
CERES, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(In thousands, except share and per share amounts)
(Unaudited)
Three months ended November
30,
----------------------------
2014 2013
---- ----
Revenues:
Product sales $ - $20
Collaborative
research and
government
grants 400 743
--- ---
Total revenues 400 763
--- ---
Cost and
operating
expenses:
Cost of product
sales 442 1,309
Research and
development 2,504 4,414
Selling,
general and
administrative 3,441 3,260
----- -----
Total cost and
operating
expenses 6,387 8,983
----- -----
Loss from
operations (5,987) (8,220)
Interest
expense (3) -
Interest income 18 16
--- ---
Loss before
income taxes (5,972) (8,204)
Income tax
expense (1) (1)
--- ---
Net loss $(5,973) $(8,205)
======= =======
Basic and
diluted net
loss per share $(0.12) $(0.33)
Basic and
diluted
weighted
average
outstanding
common shares
used for net
loss per share 48,256,820 25,106,690
CERES, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(In thousands, except share amounts and par value)
(Unaudited)
November 30, August 31,
------------ ----------
2014 2014
---- ----
Assets
Current assets:
Cash and cash equivalents $4,254 $3,423
Marketable securities 17,343 24,579
Prepaid expenses 606 633
Accounts receivable 321 370
Inventories 790 84
Other current assets 375 240
Total current assets 23,689 29,329
------ ------
Property and equipment, net 2,767 2,996
Other assets 102 99
--- ---
Total long-term assets 2,869 3,095
Total assets $26,558 $32,424
======= =======
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and accrued
expenses $3,743 $4,278
Other current liabilities 464 374
Current portion of long-term
debt 55 70
--- ---
Total current liabilities 4,262 4,722
Other non-current liabilities 70 75
Long-term debt, net of current
portion - 18
Total liabilities 4,332 4,815
----- -----
Commitments and contingencies
Stockholders' equity:
Common stock and additional paid
in capital, $0.01 par value;
240,000,000 shares authorized;
48,261,466 shares issued and
outstanding at November 30,
2014; 48,192,883 shares issued
and outstanding at August 31,
2014 332,725 332,109
Accumulated other comprehensive
loss (621) (595)
Accumulated deficit (309,878) (303,905)
-------- --------
Total stockholders' equity 22,226 27,609
------ ------
Total liabilities and
stockholders' equity $26,558 $32,424
======= =======
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SOURCE Ceres, Inc.
