Ceres Announces Fiscal First Quarter 2013 Financial Results
*Ceres doubles the number of mills in Brazil from last season.
*Mill groups and suppliers represent ~30% of sugarcane crush in Brazil.
*Plantings largely completed for the 2012-2013 sweet sorghum season.
THOUSAND OAKS, Calif. -- January 10, 2013
Energy crop company Ceres, Inc. (Nasdaq: CERE) today announced financial
results for the quarter ended November 30, 2012 and provided an update on its
business in Brazil, its largest immediate commercial opportunity.
The company reported that plantings of its new sweet sorghum hybrids have been
largely completed for the 2012-2013 production season in Brazil. Harvests are
expected to begin in late March or April.
“Our primary objective this season is to demonstrate economically compelling
yields with many mill groups, and thus, drive adoption of our products across
a broad customer base,” said Richard Hamilton, President and Chief Executive
Officer of Ceres. “It is still early in the growing season, but the weather
has been cooperating and the crop appears to be off to a good start.”
FIRST QUARTER BUSINESS HIGHLIGHTS
*For the 2012-2013 sweet sorghum season in Brazil, Ceres reported that it
will be working with 31 ethanol mills and mill suppliers in Brazil through
a combination of seed sales, agronomy and crop management services and
product evaluations. These customers, which include approximately half of
the top-20 ethanol producers in Brazil, were responsible for approximately
30% of the sugarcane crushed during the 2011-2012 production season.
*Ceres’ sweet sorghum hybrids are expected to be planted on approximately
3,000 hectares, which is less than the company originally anticipated. As
previously reported, this is due in part to the effects of the drought
last season and the focus among its customers on the field performance of
its new hybrids, which can be determined at a smaller scale than
industrial evaluations. Mills have already validated the industrial
processing of sweet sorghum during the past two seasons.
*In November, Ceres announced that its Brazilian subsidiary Ceres Sementes
do Brasil Ltda. entered into a collaboration with Syngenta. Under a market
development agreement, Syngenta will evaluate its crop protection
portfolio with Ceres hybrids. Both companies are coordinating outreach to
ethanol mills and developing industry training programs in Brazil.
*Ceres achieved positive results from field trials of its various drought
tolerance genes in rice, which it routinely uses in its development
pipeline to confirm performance. The company will proceed with wider-scale
testing, and continue to move its traits into its energy crops.
*During the quarter ended November 30, 2012, Ceres was awarded five U.S.
patents related to methods for improving plants, plants and plant parts,
transcription promoters, markers and compositions of matter for
protein-encoding DNA sequences.
FIRST QUARTER FINANCIAL RESULTS
Total revenues for the quarter ended November 30, 2012 were $2.0 million
compared to $1.8 million for the same period last year. The increase was
primarily due to an increase in collaborative research and government grant
revenue, which was partially offset by a decrease in product sales.
Of the plantings this season, approximately 1,800 hectares were planted under
certain sales incentive programs and promotions, whereby the company has
either deferred revenue until the completion of the 2012-2013 sweet sorghum
harvest season, or expects to generate revenue through agronomy services or
biomass sales. The remaining hectares, which were not enrolled in incentive
programs, consisted of seed sales that were recognized as revenue upon
delivery and planting as well as complimentary trial seed. The majority of
seed deliveries and plantings in Brazil occurred in the fiscal second quarter.
Cost of product sales was relatively flat at $0.7 million for the quarter
ended November 30, 2012 compared to $0.8 million for the same period last
year. Cost of product sales during this comparative period primarily related
to the company’s U.S. operations.
Research and development expenses decreased by $1.0 million to $4.3 million in
the quarter ended November 30, 2012 compared to the same period last year due
primarily to reduced R&D personnel and related expenses as well as lower
external R&D expenses.
Selling, general and administrative expenses were $3.8million in the quarter
ended November 30, 2012 compared to $2.8 million for the same period last
year. The increase was primarily attributable to increased personnel expenses
in the U.S. as well as an increase in Brazil expenses due to an increase in
business operations and market development support.
For the quarter ended November 30, 2012, Ceres reported a net loss of $6.9
million, or $0.28 per share, compared to a net loss of $7.5 million, or $3.73
per share, for the quarter ended November 30, 2011. Shares used in the
calculation of net loss per share (basic and diluted) were 24,693,303 and
2,018,939 for the quarters ended November 30, 2012 and 2011, respectively.
At November 30, 2012, Ceres had cash and cash equivalents of $14.4 million and
marketable securities of $38.8 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 first quarter results. The webcast of the conference call may be
accessed at investor.ceres.net. Audio of the teleconference is also available
North America callers:
+1 (720) 545-0037
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.
2013 ANNUAL MEETING OF STOCKHOLDERS
Ceres will hold its 2013 annual meeting of stockholders on February 8, 2013 at
11:00 a.m. PST at the W Hotel at 6250 Hollywood Blvd. in Los Angeles,
California.Notice of the annual meeting, proxy materials and the company’s
annual report for the fiscal year ended August 31, 2012 will be mailed to
stockholders of record as of December 20, 2012. Each attendee must be a Ceres
stockholder as of the close of business on December 20, 2012 or hold a valid
proxy for the annual meeting.
UPCOMING INVESTOR EVENTS
Ceres is scheduled to present at the Seventeenth Annual Goldman Sachs
Agribusiness Conference on February 26, 2013 in New York City. The company
will also present at the Raymond James 34th Annual Institutional Investors
Conference on March 5, 2013 in Orlando, Florida. Slide presentations will be
posted on the investor events page of the company’s website, www.ceres.net.
Ceres, Inc. is an agricultural biotechnology company that markets seeds for
energy crops used in the production of renewable transportation fuels,
electricity and bio-based products. The company combines advanced plant
breeding and biotechnology to develop products that can address the
limitations of first-generation bioenergy feedstocks, increase biomass
productivity, reduce crop inputs and improve cultivation on marginal land. Its
development activities include sweet sorghum, high-biomass sorghum,
switchgrass and miscanthus. Ceres markets its products under its Blade brand.
CERES FORWARD-LOOKING STATEMENTS
This press release may contain forward-looking statements. All statements,
other than statements of historical facts, including statements regarding our
efforts to develop and commercialize our products, our short-term and
long-term business strategies, market and industry expectations, future
operating metrics, product yields and future results of operations and
financial position, 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
our 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 intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise. These forward-looking statements should not be relied upon as
representing Ceres’ views as of any date subsequent to the date of this press
CERES, INC. AND SUBSIDIARY
Condensed Consolidated Statements of Operations
(In thousands, except share and per share amounts)
Three Months Ended
Product sales $ 14 $ 276
Collaborative research and government grants 1,952 1,472
Total revenues 1,966 1,748
Cost and operating expenses:
Cost of product sales 700 763
Research and development 4,343 5,275
Selling, general and administrative 3,844 2,804
Total cost and operating expenses 8,887 8,842
Loss from operations (6,921 ) (7,094 )
Interest expense (1 ) (111 )
Interest income 29 4
Other expense — (338 )
Loss before income taxes (6,893 ) (7,539 )
Income tax (expense) benefit (1 ) (1 )
Net loss $ (6,894 ) $ (7,540 )
Basic and diluted net loss per share $ (0.28 ) $ (3.73 )
Basic and diluted weighted average
outstanding 24,693,303 2,018,939
common shares used for net loss per share
CERES, INC. AND SUBSIDIARY
Condensed Consolidated Balance Sheets
(In thousands, except share amounts)
November 30, August 31,
Cash and cash equivalents $ 14,378 $ 21,069
Marketable securities 37,636 33,565
Prepaid expenses 758 1,050
Accounts receivable 1,488 765
Inventories 1,054 841
Other current assets 144 278
Total current assets 55,458 57,568
Property and equipment, net 5,559 5,756
Marketable securities 1,156 5,720
Other assets 105 203
Total long-term assets 6,820 11,679
Total assets $ 62,278 $ 69,247
Liabilities and Stockholders’ Equity
Accounts payable and accrued expenses $ 5,314 $ 5,476
Other current liabilities 345 732
Current portion of long-term debt 65 134
Total current liabilities 5,724 6,342
Other non-current liabilities 69 88
Long-term debt, net of current portion 96 256
Total liabilities 5,889 6,686
Commitments and contingencies
Stockholders’ (deficit) equity:
Common stock and additional paid in capital,
$0.01 par value; 490,000,000 shares authorized;
24,801,986 shares issued and outstanding at 305,740 304,917
November 30, 2012; 24,549,029 shares issued and
outstanding at August 31, 2012.
Accumulated other comprehensive loss (384 ) (283 )
Accumulated deficit (248,967 ) (242,073 )
Total stockholders’ (deficit) equity 56,389 62,561
Total liabilities, convertible preferred stock $ 62,278 $ 69,247
and stockholders’ (deficit) equity
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