Ceres Announces Fiscal Second Quarter 2013 Financial Results

  Ceres Announces Fiscal Second Quarter 2013 Financial Results

  *Sweet sorghum harvests under way in Brazil.
  *Ceres products outperforming competitors.
  *High-sugar trait validated in sorghum.

Business Wire

THOUSAND OAKS, Calif. -- April 11, 2013

Energy crop company Ceres, Inc. (Nasdaq: CERE) today announced financial
results for the quarter ended February 28, 2013 and provided an update on its
business in Brazil, its largest immediate commercial opportunity.

The company reported that commercial harvests and yield evaluations of its
newest sweet sorghum hybrids have started in Brazil, with the bulk of
locations and hectares expected to be harvested in the next several weeks when
various plantings reach maturity. Growing conditions during the season have
been generally favorable to date, and the majority of hectares appear to have
been managed well.

“As we approach harvest, our new generation of products is visibly
outperforming the products of our competitors in nearly every instance,” said
Richard Hamilton, President and Chief Executive Officer of Ceres. “Our
products are planted at significantly more mills and on more hectares than our
nearest competitor, and we are gaining a reputation as the clear innovator in
the sorghum-to-ethanol business.”

Chief Financial Officer Paul Kuc reported that expenses for the company’s
second fiscal quarter were largely in line with management's expectations, and
reflect increased levels of commercial crop management services and support
provided to Ceres’ customers this season. He expects that the cost of the
majority of these services will be covered by biomass sales and reimbursements
following the harvest of Ceres’ sweet sorghum hybrids.

He also noted that the company has reallocated some of its research spending
to reflect product advancements in its development pipeline. “We expect
expenses related to early-stage, discovery research to trend lower as we
complete this work and reallocate resources to field evaluations of our
biotech traits, seed products and other commercialization activities,” he


  *Ceres reported that the majority of the hectares planted with its sweet
    sorghum products this season in Brazil are in good condition ahead of
  *Based on customer reports, Ceres’ portfolio of sweet sorghum hybrids
    appears to be outperforming products from competitors at locations where
    side-by-side comparisons are available. Final results are not yet
  *The company has successfully validated its high-sugar trait in sorghum.
    Initial evaluations of this biotech trait in non-commercial types have
    demonstrated significant increases in fermentable sugar concentration,
    increased juiciness and greater sucrose purity.
  *Ceres trait developers have demonstrated higher-than-expected drought
    tolerance results in switchgrass. In field evaluations, plants with the
    company’s drought tolerance genes maintained 100% biomass yield levels
    under water deficits of approximately 50%.
  *During the quarter ended February 28, 2013, Ceres was awarded six U.S.
    patents related to a commercial product, methods for improving plants and
    plant parts, and compositions of matter for protein-encoding DNA


Total revenues for the quarter ended February 28, 2013 were $1.0 million
compared to $1.3 million for the same period last year. The decrease was due
to lower collaborative research and government grant revenues as well as lower
seed sales.

Cost of product sales increased to $2.3 million for the three months ended
February 28, 2013 compared to $0.5 million for the same period in the prior
year. The increase was due to expenses of $1.1 million for obsolete seed
inventory, which primarily consisted of first generation sweet sorghum
products, and $0.6 million related to as yet unharvested sweet sorghum crops
produced under one of the company’s sales incentive and performance based
promotional programs for the 2012-2013 growing season in Brazil.

Research and development expenses decreased to $4.4 million for the three
months ended February 28, 2013 compared to $5.0 million for the same period in
the prior year. The decrease was primarily attributable to reduced research
personnel and related expenses in Brazil of $0.3 million as well as reduced
expenses for supplies and external research and development in the U.S. of
$0.3 million.

Selling, general and administrative expenses were $3.4 million for the quarter
ended February 28, 2013 compared to $2.8 million for the same period last
year. The increase is attributable to higher U.S. personnel expenses of
$0.5million and a $0.1 million increase in expenses related to expanded
business operations and market development support in Brazil.

For the quarter ended February 28, 2013, Ceres reported a net loss of $8.97
million, or $0.36 per share, compared to a net loss of $6.83 million, or $2.48
per share, for the quarter ended February 29, 2012. Shares used in the
calculation of net loss per share (basic and diluted) were 24,801,986 and
2,760,016 for the quarters ended February 28, 2013 and February 29, 2012,

At February 28, 2013, Ceres had cash and cash equivalents of $15.5 million and
marketable securities of $29.4 million.


Ceres has scheduled a conference call for 4:30 p.m. EDT (1:30 p.m. PDT) today
to discuss second quarter results. The webcast of the conference call may be
accessed at investor.ceres.net. Audio of the teleconference is also available
by dialing:

                            North America callers:
                                (877) 838-4153

                            International 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.


Ceres is scheduled to present at the Jefferies Global Industrials Conference
on August 12, 2013 in New York City. The company’s slide presentation 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.


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, 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
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 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 release.

Condensed Consolidated Statements of Operations
(In thousands, except share and per share amounts)
                       Three Months Ended                           Six Months Ended
                       February 28,         February 29,            February 28,         February 29,
                        2013               2012                  2013               2012      
Product sales          $ 59                 $ 111                   $ 73                 $ 387
research and            967                1,200                 2,918              2,672     
Total revenues          1,026              1,311                 2,991              3,059     
Cost and
Cost of                  2,280                487                     2,980                1,249
product sales
Research and             4,368                4,991                   8,711                10,267
general and             3,392              2,813                 7,236              5,618     
Total cost and
operating               10,040             8,291                 18,927             17,134    
Loss from                (9,014     )         (6,980    )             (15,936    )         (14,075   )
Interest                 (1         )         (107      )             (1         )         (218      )
Interest                 49                   2                       78                   6
Other income            —                  254                   —                  (84       )
Loss before              (8,966     )         (6,831    )             (15,859    )         (14,371   )
income taxes
Income tax
benefit                 —                  —                     (1         )        (1        )
Net loss               $ (8,966     )       $ (6,831    )           $ (15,860    )       $ (14,372   )
Basic and
diluted net
loss per share         $ (0.36      )       $ (2.48     )           $ (0.64      )       $ (6.01     )
to common
Basic and
average                  24,801,986           2,760,016               24,747,344           2,389,543
common shares
used for net
loss per share

Condensed Consolidated Balance Sheets
(In thousands, except share amounts)
                                             February 28,         August 31,
                                              2013               2012     
Current assets:
Cash and cash equivalents                    $ 15,467             $ 21,069
Marketable securities                          29,364               33,565
Prepaid expenses                               664                  1,050
Accounts receivable                            697                  765
Inventories                                    1,139                841
Other current assets                          221                278      
Total current assets                           47,552               57,568
Property and equipment, net                    5,241                5,756
Marketable securities                          —                    5,720
Other assets                                  107                203      
Total assets                                 $ 52,900            $ 69,247   
Liability and Stockholders' Equity
Current liabilities:
Accounts payable and accrued                 $ 4,442              $ 5,476
Other current liabilities                      223                  732
Current portion of long-term debt             103                134      
Total current liabilities                      4,768                6,342
Other non-current liabilities                  50                   88
Long-term debt, net of current                76                 256      
Total liabilities                             4,894              6,686    
Commitments and contingencies
Stockholders’ equity:
Common stock and additional paid in
capital, $0.01 par value;
authorized; 24,801,986 shares issued           306,657              304,917
and outstanding at February 28,
24,549,029 shares issued and
outstanding at August 31, 2012
Accumulated other comprehensive loss           (718     )           (283     )
Accumulated deficit                           (257,933 )          (242,073 )
Total stockholders’ equity                    48,006             62,561   
Total liabilities and stockholders’          $ 52,900            $ 69,247   


Ceres, Inc.
Gary Koppenjan
Investors: 805-375-7801
Media: 805-376-6546
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