Adam Jackson
Rising sales of Caconic medical cannabis products helped boost Rehovot, Israel-based Evogene Ltd.’s (Nasdaq: EVGN, TASE: EVGN) balance sheet for the second quarter ending June 30, 2022.
Evogene said on Wednesday that it posted revenue of $312,000 in the second quarter, up 131% from the same period the previous year. Initial sales of Lavie Bio’s Thrivus product (previously branded as Result) and sales of Canonic medical cannabis products in the Israeli market drove most of the revenue.
The company reported a loss of 21 cents per share.
Net loss for the quarter was $9.8 million versus a net loss of $6.9 million in the same period in the previous year. The increase in net loss was mainly due to financing expenses of $1.7 million, mainly due to the fluctuating exchange rates between periods and a decrease in marketable securities value.
“Evogene today is at a key inflection point, whereby we are meeting critical milestones and the inherent value of our subsidiaries is becoming increasingly obvious,” President and CEO Ofer Haviv said.
“Evogene’s goal in the near term is to continue to bring high value-adding partners and investors at the subsidiary level, who understand and can value the potential from the products that our subsidiaries are developing.”
The company said that it continues to maintain a solid financial position for its activities with approximately $35.3 million in consolidated cash, cash-related accounts and marketable securities as of June 30, 2022. The company does not have bank debt.
Evogene’s full-year net cash burn rate, excluding exchange rate impacts in 2022, is expected to be in the range of $26 million to $28 million including Lavie Bio, which manages its own cash position. Excluding Lavie Bio, the cash burn rate is expected to be between $18 million to $20 million.
“Our target is that each subsidiary will have its own financial resources to support its activities until its success, while we at Evogene, in addition to being a major shareholder, continue to play a major role in maintaining and building their competitive advantage through our tech-engines,” Haviv said.
Medical Cannabis
Canonic began initial commercial sales of its first products from the MetaYield program in Israel last October. The milestone for 2022 is the commercial launch of second-generation MetaYield products in the country.
Canonic shipped a first batch of its unique cannabis varieties in January to a potential cultivation subcontractor in Portugal to test those varieties under European growing conditions. Evogene also hopes to enter into commercial agreements with local growers and manufacturers in Europe to meet the milestone of commercialization in 2023.
Canonic announced positive results in preclinical studies for the Precise program in January this year that supported the successful identification of specific cannabis varieties with anti-inflammatory and pain relief properties. Evogene plans to launch these products in 2023.
