Hello, everyone, and thank you for joining us on today's Bioceres Crop Solutions' Fiscal Third Quarter 2025 Financial and Operational Results. My name is Drew, and I'll be the operator on today's call. [Operator Instructions] It's now my pleasure to hand over to Paula Savanti, Head of Investor Relations, to begin.

Thank you. Good morning, and welcome, everyone, to Bioceres Crop Solutions' Fiscal Third Quarter 2025 Earnings Conference Call. Our prepared remarks today will be led by our Chief Executive Officer, Federico Trucco; and our Chief Financial Officer, Enrique Lopez Lecube, as well as our Chief Commercial Officer, Milen Marinov, all of whom will be available for the Q&A session following the presentation. During this call, we will make forward-looking statements. These statements are based on current expectations and assumptions that are subject to various risks and uncertainties. I refer you to the forward-looking statements section of the earnings release and presentation, as well as the recent filings with the SEC. We assume no obligation to update or revise any forward-looking statements to reflect new or changed circumstances. Please note, in today's presentation, we'll be making references to certain non-GAAP financial measures. Reconciliations of the non-GAAP financial measures can be found in our earnings press release. This conference call is being webcast, and the webcast link is available at our Investor Relations website. It is now my pleasure to turn the call over to Federico.

Thanks, Paula, and good morning to everyone. And welcome, Milen Marinov, our Chief Commercial Officer, on his first earnings call with us. Please turn to Slide #3 for an overview of this quarter's main highlights. Our third fiscal quarter is typically uneventful as it falls in the off-season for most of our geographies. In the past 2 years, it stood out of the ordinary due to the accrual of portions of the $50 million upfront payment from Syngenta, which significantly improved the P&Ls of the quarter. This year, however, it stands out for a non-P&L achievement, which is our exceptional cash flow performance. We're very pleased to report a $40 million improvement for this metric on a year-over-year basis, which helped us reduce our debt and improve our cash position, as Enrique will describe in a minute. An important contributor to our cash flow performance this quarter is the shift in our seed business strategy, which is also enabling a more focused approach. Some early benefits of these changes are already visible this quarter with more expected in the quarters to come, as I will describe later in the presentation. We're also very excited about the long-awaited EPA approval of RinoTec. As Milen will describe in a few minutes, we can now offer growers and partners a full suite of on-seed and on-field biological solutions for pest control and plant health and nourishment alike for both cash and row crops across the world's largest agricultural markets. We are indeed in a unique position to facilitate the transition to a more sustainable, yet more productive agricultural reality. Let me now pass the presentation over to Enrique for a deeper look at this quarter's financial performance. Enrique López Lecube: Thank you, Federico, and good morning to everyone. Good to have you on…

Thanks, Quique. Let's please turn to the next slide. I'll try to move faster so that we've enough time at the end for Q&A. But as we transition in our seed business model, we want to provide an update in terms of what is going on in the field, as well as what we have done already organizationally to achieve a more focused business. The soybean harvest in Argentina has been delayed by about 1 month due to late season rains, and it's generally expected to be a good crop. Once we collect variety performance data, we'll be transferring the continuing good performing HB4 materials to our main multipliers and customers for them to multiply in future seasons and develop commercially directly with their farmer base. Also, we expect an initial set of materials from the Verdeca GDM collaboration to be registered, subject to field performance, from combines in the coming days so that these materials can be made available to the GDM network in the upcoming season, as well as we described in our last earnings call. Outside of Argentina, our regional partners in Uruguay and Paraguay are moving forward with the registration and multiplication processes also in the current season so that we can have initial commercial activity in both countries in fiscal '26. In Brazil, which is seasonally ahead of the rest, we have already started commercializing our inventories and compare this to last year, where first sales occurred in July and August. So we're in good shape there. More importantly, in Brazil, the variety registration trials have been initiated for HB4 wheat with 28 [ proto tentative ] varieties developed by EMBRAPA being tested in 12 locations in Central Brazil. And similarly, the best materials will be registered and offered to our main customers and partners…

Good morning, everyone, and thank you for being with us. I would like to give a quick update on RinoTec and also on the key commercial focus areas for us into next year and into the near term. The RinoTec platform is truly a novel enterprise for us, and 2025 is our prelaunch year. As you know, as of today, we have registrations in the United States and Brazil with state-by-state approvals ongoing as we speak. And in terms of what we expect around RinoTec, the #1 market for us is obviously to be positioned in all the key states in the United States. And the second most important one is to be able to have the right select channel and strategic partnerships. The -- what's unique about RinoTec is the fact that we've developed this platform for conventional acreage for both row crops and specialty crops, including corn, soybean, cotton, tree nuts, potatoes and others, and the -- we're incredibly hopeful and we're placing a big bet on RinoTec because of that. Usually, in biologicals, you tend to target niche and often organic markets. Here, we were very deliberate and purposeful in targeting the conventional acreage. Conventional acreage for us, when it comes to our biocontrol platform, is essentially new acres because today, most of our business at the Pro Farm business unit is organic. Close to 70% is organic. So it is important for us, as we continue to complete our registration, to also line up the right partners, and we're currently in discussions with what we think are the right and committed partners for this opportunity because it is, at the end of the day, a scale game. We have -- we're approaching the market under 4 brands: 3 in the United States, Arino, Neovo and Bronte;…

Okay. Thanks, Milen, for that overview. I think why don't we just go to Q&A directly so that we can have enough time to address questions from the audience.

[Operator Instructions] Our first question on today's call comes from Kristen Owen from Oppenheimer.

Enrique, this first one is for you. Just congratulations on the nice cash advancement here in the quarter. I'm just wondering, as we're working through some of those remaining grain inventories, how much of the working capital unwind is there still to come? And then, as we look further out, I'm not necessarily looking for specific guidance, but just some directionality on your expectations for sort of a look at annual EBITDA to free cash flow conversion. How should we think about that evolving over time? Enrique López Lecube: Kristen, thank you for joining us, and thanks for the question. I think you're right in mentioning that because it is an important part. Like I mentioned of our cash generation, in this specific quarter, comes from that reorganization. And that's more of a one-timer. I think that going forward, we can expect probably an additional $10 million coming from that transition into a lighter model with HB4. And that -- once that's in our balance sheet, it won't longer be kind of like an ongoing effect. So, that is one. The other one on the sort of like conversion of EBITDA into free cash flow, I think without getting into guidance, and again, we are in a transitioning period now, so harder for me to say that. What I think and what I can give you as kind of like a reference is that we do want to go back to what we had historically, that was a net working capital of 4 months to 4.5 months of sales. And I think that, that also carries something that Milen referred to, that is the type of portfolio that will end up shaping our sales. So there's sort of like a close connection between what technologies we are prioritizing to sell,…

That's incredibly helpful. The 4 to 4.5 months is something that we can wrap our brains around. So given that there is some reliance on a return to stability at least in the end markets, I mean, this is agriculture, it's never stable. But we are also keenly aware here, in North America, of all of the political volatility that's happened over the last, call it, 3 months, that some may have missed some of the things that have also happened in Argentina, some of the updates like the removal of certain currency controls. So Enrique, you also started to talk a little bit about an early look into the fiscal fourth quarter. Just wondering if you can give us a little more color on the on-the-ground sentiment in Argentina, whether it's from a broad-based macro perspective, but also how that's going to manifest for your farmers and customers. Enrique López Lecube: Yes. No, I think that that's a right assessment of the situation, Kristen. And like I mentioned in the call, and then I'll probably refer to Milen or Federico, but I think that sentiment in Argentina is slowly building up, which is what you want to have if you want to get into a more stable market. If you have the big swings of people feeling depressed or feeling excited, that's usually more volatile. So what we're seeing is that with more stable macroeconomic conditions, the market is normalizing. That's why I mentioned that this was a sort of like go to -- go back to normality seasonal quarter in terms of slowdown, where people are just purchasing what they're putting on the field, and that's normal as opposed to what happened in the past that was more of a speculative behavior linked to currency. I think that we are sort of like transitioning into a normal-to-good winter crop season with sort of like enough moisture. Recently, the government has confirmed that they will keep export tax duties on winter crops down. So there's not going to be an increase in export tax duties that was previously expected. That should build up into commodity prices and help farmers' profitability. I don't think that we're heading into a bumper crops -- winter crop season. But we're heading into a healthy season. And like I mentioned, in Argentina, I think that the confirmation of a comeback or not will happen with summer crops. Summer crops remain to be the big part of the party in Argentina. And I do like how things are shaping up as we walk into the new year. I don't think that we will have a Q4 that allows us to sort of like recover what we lost in a particular rough year in Argentina. But I do like how things are shaping up for the next season. I don't know if Federico or Milen have any other comments on that.

No, I agree with that. The other part that I would mention is that unlike last year, the harvest this year is going to be good. So we have not seen a severe effect of a drought like it was last year. So the peak component, it's going to be favored to some extent by the reduced taxation, even though international prices remain low. But the cube part of the equation, I think, it's going to be good, and that, for farmers that are usually productivity focused, it's quite a positive element, emotionally at least. So that is the only thing I wanted to add.

Yes. I mean, look, another way to look at this is, we're probably in the onset of emerging from the perfect storm, right, cycle, weather, farmer, geopolitical. The way I look at this is, in some ways, it helps to maintain clarity as to where the issues are. And in Argentina, we're roughly 30% down to [ 24 ]. 95% of that is due to [ microgranular ] and a convergence of negative events that -- over which we have very little control. And our performance there is perhaps not as challenged as our competitors and peers, but it's been a challenge. And now, as we look into '26, what we see is, so far is positive. The growers are going to have a good crop. The winter season is looking up so far. The corn acreage is increasing compared to the soy acreage in Argentina. From a nutrition point of view, that's a net positive for us. That's where microbead is going to be used more. The farmer sentiment seems to be more optimistic. The pricing is stabilizing. The inventories in the channel at the farms are low. And we are ourselves, when it came to the things that we control, we spent year-to-date '25 absolutely focused on sellout across the board. So I think if these factors on the outside remain even softly as they are right now and if we continue to pursue operational and commercial excellence to the best of our ability the way we have so far, I'd say we're looking at a tailwind. When it comes to tariffs, it's a net positive for Brazil and Argentina, where we obviously have quite a bit of exposure. The big question is always in the United States. I can't say we have all the answers. It's anybody's guess where things settle at the end. Perhaps they won't be as drastic and uncertain as they seem at this very moment. But what we know is that close to 90% of what we sell in the United States, we make in the United States, and more than 90% of what we sell in the United States, we make here. So I think that, that somewhat insulates us from any potential further fogginess or volatility in this particular market. Historically, we've also been incredibly strong in cash crops. As we ramp up RinoTec, which gives us new exposure to conventional row crop acres, which will be a meaningful growth driver for us, we're looking at initial revenue coming close to the second half of 2026. So hopefully, by then, the dust would have settled, and we all would have greater visibility when it comes to tariffs in the ag market in the U.S. in particular.

Our next question today comes from Ben Klieve from Lake Street Capital Markets.

A couple. First, a quick one, Enrique, for you. The $7.5 million nonoperating income payment that you noted, which I believe was around retirement of royalties due for HB4 soy, was there any cash component to that? Or was that a largely or entirely noncash item? Enrique López Lecube: Ben, thanks for joining and for the question. Good to have you. That was primarily noncash. There was a small cash component to it, but it was largely done in a noncash exchange of IP and intangible assets like Federico mentioned.

Okay. Perfect. And then, one more just kind of a more philosophical question for you, Milen. It's great to have -- hear your thoughts on the call today. You've got a lot of ongoing initiatives here to kind of jump start the commercial process here at Bioceres. And I'm wondering if you can help us understand which kind of drivers you're looking at have the kind of greatest visibility being realized within, call it, fiscal '26. It sounds like RinoTec is going to have kind of a soft launch second half of fiscal '26. Wondering what other initiatives you think we'll be talking about a year from now that have really shown on the financials.

Yes. So a good question. Thank you for that. Indeed, it sounds like we have a number of levers. We do -- we're actively working to make sure that we remain incredibly focused on the things that really move the needle. We have a full portfolio today. And usually, you hear feedback from the commercial teams that goes along the lines of we don't have enough. I think we have more than enough. You're absolutely right. Our #1 focus is to continue to improve off of today in Argentina. We just talked about that. I think another positive there for us is that seed treatment seems to be doing well, and that's an early indicator for us. But let's say, we continue to maintain our steady performance and realize our position as a technology innovator and essentially an ag innovation gateway into Argentina. The thing to look for and what we will be focused on is growing and unfolding commercial excellence in the markets outside of Argentina: #1, Brazil; # 2, the United States; #3, the rest of LatAm; and lastly, Europe. So the first key measure for us is, whereas Argentina historically has been 65%, 70% of our top line, I would like to see that cut in half over the next 3 years. And I believe that even without RinoTec, we can do that. The second one is how we scale our biologicals portfolio in general, how do we manage that product mix? I think that we're well positioned in all of these markets. I think that one of the things that we need to continue to work on and deliver on is our B2B and our seed treatment capability. I would say that for a par excellence biological business, this is really something that sets us apart.…

No, that was very helpful. I appreciate that on all counts.

Our next question today comes from Austin Moeller from Canaccord.

So I guess, I was just wondering if -- in the Brazilian market, if the tightening of credit conditions there have affected any of your customers in purchasing or procurement of pesticides or fertilizer. Enrique López Lecube: Austin, this is Enrique. Thanks for joining us and thanks for the question. That's a good question. Actually, no. I mean, we've been pretty much isolated from what happened in Brazil probably in the second half of last year that was tough for the high inputs market in Brazil. We didn't have any issues there. I do think that the increase in interest rates in Brazil has, to some degree, affected agriculture. And to me, the offsetting factor to that, that is exogenous to Brazil is what Milen mentioned about sort of like the tariffs and how that played out to favor Latin America, particularly. I mean, the main competitor for Brazilian soybeans in the global market is the U.S. So the fact that the U.S. has introduced some volatility as to that -- how that supply would flow into the global market has shifted demand of soybeans into Brazil. And you can see that pretty much reflected in Brazilian soybean premiums paid to the U.S. reference value. That, to me, is more important than what has happened at the interest or financial cost level. That was something that, to some degree, put some stress on the whole chain. So, as a conclusion to your question, number one, no, we have not been affected by that particularly. Number 2, the market, yes, is under stress because of that. But I think that the offsetting factor of what I told you about farmer profitability has, to some degree, changed the mood and moved that discussion on financing of the chain to a second level of importance. So that's why we think that we are heading probably into a better market in Brazil than what we have this year.

Okay. Great. And just a follow-up. So if we look at the U.S. market, where lending standards and credit is just so much more available for U.S. farmers, as we see continued reduction in interest rates in the U.S., do you think that, that's a demand tailwind for you for procurement of inputs by U.S. customers? Enrique López Lecube: I'll give you my sort of like 30,000 feet view and probably let Milen to comment on that. But I do think that it is good. Having said that, it is one of the sort of drivers that made the industry getting into trouble in the past. So we are not counting on that. We are focused, like Milen said, on sort of like driving growth from the technologies that are a priority to us, that carry good profits not only to us but also to our customers, and to some degree, I think that, that should be isolated from a discussion of whether the cost of money is up or down. That's not the path we want to head into because of what happened in the past. Having said that, obviously, that it helps to offset some of the volatility that the tariff discussion introduced, particularly into row crops, and that's another distinction. I think it's worth noting. The game is probably completely different in high-value crops than what it is in row crops. So I'll let Milen comment on that. But in my view, that's probably better to have than what we have with a higher cost of money, but we shouldn't be counting on that or baking that into our projections or business plans. Milen, I don't know if you want to add any particular comments on that.

No, look, I see -- I mean, I think folks are generally more optimistic. They also went through a major exercise that perhaps they hadn't done in a while in better managing working capital across the board. I think we ourselves were highly in tune with that when we saw it coming before we saw it happening in the U.S. We've -- that's one of the reasons why early on, we started really reorienting around sellout, and I don't -- I mean, very specifically, aligning internal and channel national and retail incentives essentially to make sure that we fit with the way customers are being sensitive about their own cash. Now, if you were referencing just general credit rating and all of that and the continued pop-up in the 10-year, I think that perhaps the bigger unknown remains the tariff situation as far as macro goes. Our crop mix, our product mix and what our solutions do for our customers in terms of profit -- in terms of ultimately yield gains and the type of margin that we deliver to our channel partners, which is far more attractive and punches way above our size in terms of impact for them. I think those are insulating factors for us. And by the way, the farm balance sheets in the U.S. remain relatively strong. I mean, this is probably one of the most important factors here, right? But that's a net positive for us as well.

Our next question on today's call comes from Steve Byrne from Bank of America.

I was just curious whether you had any field trial results from that Neovo product for corn in the U.S., perhaps the [ land-grant universities' ] or your own field trials or the retail channel or the seed companies have been evaluating this product. I'm just curious whether you have some data that highlights the impact on yield versus maybe conventional or synthetic chemicals. Just curious how that looks. And are you likely to pursue partnership on this with the seed companies as a seed treatment or through the retail channel and the co-ops for more of an in-furrow application?

Yes. Thank you. It's really good and substantive question around RinoTec. I'm not in a position to share any specific data. But what I would say is that we've -- we'll have a technical bulletin on our website on this. In addition to previous trialing, we have ongoing replicated third-party field trials. Those are actively underway. Neovo comes with 5 years of trials, which have demonstrated results equivalent to -- by [indiscernible], which is, as you know, the leading grower standard. In terms of partnerships, we're working with both strategic partners as well as with channel partners. We're being incredibly careful and deliberate. We realize the importance of this launch and the importance of the quality of the partnerships to allow us to scale this the right way. They've all seen data that they liked. So we're not in the early innings of these conversations. We remain focused on refining our fit within the conventional IPM spray programs to deliver unique and differentiated value there. We're -- I think we're seeing positive feedback in finding differentiated fits on almost every crop market segment that we're targeting. We've done over 65 trials in corn alone with universities and CROs over the last 5 years. And I think today, our field development in the U.S. has over -- I don't want to butcher the number, but it's safe to say at least 120 replicated field trials, and they're covering key use patterns, including seed treatment, foliar, soil applied, key pests, from soil insect, [ nematode ] to foliar insects and mites. We're doing work on over 30 species that we're targeting. And the crops that we're channeling our developmental dollars on are corn, soybean, cotton, potato, sweet potato, tree nuts, citrus berries and melons. I think globally, we probably have over 400 trials to [ replicate in-lab ] trials.

Very good. And then, just one more quick one on the HB4 soybean and wheat. Any interest from the seed companies in the U.S. and Canada for those traits?

Steve, this is Federico. It's nice to have you on the call. Yes. So in terms of HB4 wheat, as you know, we're moving forward in the U.S. with a network of public and private institutions to deliver that solution in the near term, particularly to Midwest growing fields, if you will, and probably looking to make an announcement on that front in the coming weeks. And then, in terms of soy, we're mostly focused on Latin America, particularly with the GDM collaboration, trying to move outside of the drought tolerance space into [ wheat ] management. So, that is our top priority today. There's an opportunity for that to extend or expand into the U.S. and Canada. But I think it's not something you will see in the near future. So this is probably more than 2 to 3 years out in terms of those 2 markets.

Our final question on today's call is from Kemp Dolliver from Brookline Capital Markets.

I'll ask one question quickly, which is, there was a comment earlier about RinoTec doubling the growth of the Crop Protection platform over the next few years. So the way I'm thinking about this is that if we normalize the growth rate of Crop Protection for the recent downturn, come up with a number, RinoTec would essentially double that number? Or are you thinking of it differently?

Yes. So the way I would think about this is -- so in the -- so first of all, this was a geography-specific comment based largely around the United States, where we have the largest -- where we have and are getting our registrations in line, where we have done most of the work around brand partnership development. The way I would look at this is -- and we haven't -- I wouldn't say that -- unlike the broader crop protection market, we've remained fairly steady in our flagship portfolio. We have not seen the kind of hits that others might have experienced. As you can appreciate, this is, to a large extent, brand recognition, longevity and the legwork that our excellent commercial team is doing in the field. It is also largely crop mix. So one way to look at this is steady growth in the flagship portfolio. And in the next 3 years, I see a potential for -- with a slower ramp-up into '26 and '27 with an additional 10% coming from RinoTec and then ramping up from there. I think this will largely depend on how we finalize partnership discussions and where we initially decide to focus together with our partners. But roughly speaking, if I were to -- again, if I were to look at what we have in our hands today in terms of portfolio, what's coming down the commercial pipeline, doubling revenue over the next 5 to 7 years in biocontrol alone with RinoTec is the base scenario that we're looking at. Again, what we have -- but honestly, we haven't quite focused on is the rest of the portfolio that we have in our hands in North America. And that includes biostimulant -- a really compelling and competitive biostimulant solution, as well as the rest of the Bioceres portfolio, which includes adjuvants and inoculants.

We have no further questions in the queue at this time. So, that does conclude the Q&A session on today's call. I'll now hand back over to Federico Trucco to do some closing remarks.

Thank you. And thanks, everyone, again for participating in today's call. Please feel free to reach out to our Investor Relations team if you want further information on the quarter's performance and looking forward to a positive momentum in the remaining quarters and delivering on some of these very exciting opportunities that we have commented during the call. Have a great rest of the week. And I think with this, we can conclude the call.

Thank you. That concludes today's call. You may now disconnect your line.