Welcome to Evogene's First Quarter Results Conference Call. [Operator Instructions] As a reminder, this conference is being recorded May 23, 2024. Before we begin, I would like to caution that certain statements made during this earnings conference call by Evogene's management will constitute forward-looking statements that relate to future events. The presentation contains forward-looking statements relating to future events and Evogene Ltd., the company may from time to time make other statements regarding our outlook or expectations for future financial or operating results and/or other matters regarding or affecting us that are considered forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995 and other securities laws, as amended. Statements that are not statements of historical fact may be deemed to be forward-looking statements. Such forward-looking statements may be identified by the use of such words as believe, expect, anticipate, should, plan, estimated, intend and potential or words of similar meaning. We're using forward-looking statements in this presentation when we discuss our value drivers, commercialization, efforts and timing, product development and launches. Estimated market size and milestones pipeline as well as our capabilities and technology. Such statements are based on current expectations, estimates, projections and assumptions describe opinions about future events, involve certain risks and uncertainties, which are difficult to predict and are not guarantees of future performance. Readers are cautioned that certain important factors may affect the company's actual results and could cause such results to differ materially from any forward-looking statements that may be made in this presentation. Therefore, actual future results, performance or achievements and trends in the future may differ materially from what is expressed or implied by such forward-looking statements due to a variety of factors, many of which are beyond our control, including without limitation, the current war between Israel,…

Hello, and good day, everyone. In today's conference call, I would like to start with Evogene Group's financial and business highlights from the beginning of the year, continue with an overview of Evogene's activity and achievements since the beginning of 2024 and conclude with the achievement of our subsidiaries during that period. Following my part, Evogene's CFO, Yaron Eldad will provide financial update of Q1 2024 activities. After that, we will open the Q&A session. Let's start with Evogene's Group financial and business highlights that took place from the beginning of this year. In Q1 2024, our total revenue reached approximately $4.2 million compared to $0.6 million in Q1 2023. Looking ahead to the full year, 2024, we anticipate continued revenue growth compared to the previous year. In Q1 2024, our loss was approximately $3.8 million compared to $7 million in Q1 2023, a decline of approximately 46%. Additionally, our projected cash use for 2024 excluding Biomica and Lavie Bio is approximately $8 million compared to $12.5 million in 2023, demonstrating a notable 36% decrease year-over-year. In Q1 2024, Evogene closed down Canonic's operation, resulting in an annualized saving of $1.5 million. On February 6, Evogene and Verb Biotics entered a collaboration agreement to advance probiotic innovation, aiming to produce sustainable microbial metabolites, known to improve human health and vitality. On April 2, Evogene and The Kitchen FoodTech Hub by the Strauss Group, established Finally Foods, an AI-driven company aiming for established sustainable and efficient protein production in plants, for the food sector. Evogene holds approximately a 40% stake in Finally Foods. The new company is funded by The Kitchen Hub and the Israeli Innovation Authorities. These two new collaborations demonstrate the implementation of Evogene's business model in which we leverage our technology in new life-science sector, not covered by…

As of March 31, 2024, Evogene had consolidated cash, cash equivalents and short-term bank deposits of approximately $26.6 million compared to approximately $31.1 million from December 31, 2023. During the first quarter, the consolidated cash usage was approximately $4.5 million. Excluding our 2 self-funding subsidiaries, Lavie Bio with a positive cash flow of approximately $0.3 million and Biomica with a cash usage of approximately $1.4 million, the cash usage of Evogene and the other subsidiaries was approximately $3.4 million. As Ofer already stated, our projected cash usage for 2024, excluding Biomica and Lavie Bio is approximately $8 million compared to $12.5 million in 2023, demonstrating a notable 36% decrease year-over-year. Revenues for the first quarter of 2024 were approximately $4.2 million compared to approximately $0.6 million in the same period the previous year. The revenue increase was primarily due to revenues recognized by Lavie Bio with a license agreement with Corteva and due to revenues recognized by AgPlenus, with a new collaboration with Bayer during the first quarter of 2024. As Ofer stated, we anticipate continued revenue growth in 2024 compared to the previous year, mainly in the second half of 2024 based on Casterra's forecast for seed-order supply. R&D expenses for the first quarter of 2024, which are reported net of non-refundable grants received, were approximately $4.8 million and remained stable as compared to approximately $4.8 million in the same period in the previous year. Sales and marketing expenses were approximately $992,000 for the first quarter of 2024 compared to approximately $800,000 in the same period the previous year. The increase is mainly due to increased sales and marketing activities in Casterra promoting its elite seed varieties and Lavie Bio promoting the sales of its first commercial product, Yalos. General and administrative expenses were approximately $1.7 million in the…

[Operator Instructions] The first question is, are there any updates on Evogene CRISPR capabilities?

This is Ofer speaking. As you know, we participate in a very important consortium that was focusing on developing CRISPR technology, and we took a major role in this consortium. The technology that we established in this consortium was the base for our collaboration announced late last year with Color in developing genome editing technology for crustacean traits. We also have internal activity here in Evogene with respect to the CRISPR technology for plant. So yes, we are active in this area. Yes, we are also looking for opportunity to leverage the technology that we develop there. And when there will be specific news, we will be more than happy to disclose it to our investors.

The next question, how are your Casterra seed suppliers preparing today for harvest, which can support follow-on orders to ENI in 2025?

I will ask Yoash, the CEO of Casterra to answer this question, Yoash?

Yes. So in Brazil, our seed suppliers are doing this for the second year. They all have the right equipment and everything is streamlined. We are visiting there periodically. One of our ergonomist just came back last week. Another one is going next week. I visited there personally about 1.5 months ago to make sure that everything is ready for harvest. In Kenya, which is turning to be our major seed supplying operation, we purchased castor header from Nardi in Italy. It is being shipped next week out of Italy and will arrive in time for harvest in Kenya. We're also shipping dehulling and seed processing equipment from India and China to set up our own logistical center. And where we will dehull, clean, sort and pack the seeds all under Casterra. We're in the process of registering a local entity in Kenya, which will operate as above mentioned. Again, we are there. I personally visited each and any of our growers and the location for the seed processing. And at this point in time, we see envision no problems in the seed processing and harvest procedures.

What considerations do you believe remain outstanding before ENI can place a follow-on order for castor seed to be delivered in 2025?

Yoash, can you take this question as well.

Sure. So we cannot comment at this point in time about 2025 orders. I will only say that we are deep into negotiations with clients for most ENI, of course, on the different territories, which means Kenya and other African territories, some of the orders going directly to ENI in specific location, others are going through their main headquarters in Italy. We are negotiating with both. And as soon as we have clear orders, we will, of course, notify everybody.

Were 100% of the upfront payment from Bayer to AgPlenus is realized in the first quarter? And do you expect the ongoing R&D funding milestone payments and royalties to allow AgPlenus to be a profitable on a go-forward basis.

Here with us, we have also Dan Gelvan, the new CEO of AgPlenus, which I'm very happy that you joined us at the beginning of this year. And I will ask him to take the lead and answer this question. So Dan, please?

So thank you very much. As Yaron said, the full amount of the upfront payments were recognized by Evogene in this quarter. And to the second part of the question, the payments that we are receiving are a significant contribution to our revenues, and they are in addition to other revenue streams that we have from other collaborations. We are not yet cash positive from these. Evidently as we go along and we start to receive from these multiple collaborations, both the milestone payments and royalties in the future, we will be cash positive. We continue to expand our collaborations in order to be self-sustainable in the short term, even before we start to receive significant revenue payments.

The next question, what is your confidence level in filling the $10 million castor-seed order by year-end? And what will be the cadence of the filling of this order?

Yoash, can you take this question as well?

Yes. So as we notified, we envision production of at least 900 tons of seeds in 2024. So we will be able to fill all the open orders for 2024 -- 2023 and 2024. The cadence will be the major supply will start in August all the way through December, and will probably peak around October.

The next question, a cash question. What amount of cash have you front-end invested to line up capacity for the 900 tons for castor. What amount of future investment will be needed?

So I will take this question. This is something that Casterra is responsible for, but still I would answer it. So there is a need, of course, when you build an inventory for ongoing capital and as I mentioned earlier, one of the things that we are doing in Evogene is investing our money in the places where we see high probability of success. So one of the reason what we're planning to do is that part of the money that we are going to save from closing Canonic activity, is to invest in funding the ongoing capital needs of Casterra. So this is already all taken into account and we built it in a way that we can fund the needs for the inventory. And when we'll start to receive revenue from our partners, we are going to use it to build the inventory for next year. And since we are expecting to start to receive significant amount of money during the third quarter of this year, so we are going to build the inventory for 2025 actually starting in 2024. So this is how we are going to fund our ongoing -- the need for ongoing capital. At the beginning -- for this at the beginning of the first half of 2024 is going to be from Evogene resources, part of it coming from closing Canonic. Second half, it will start also to be funded from revenue we are going to generate from the -- our existing partners. Because what we are trying to do is that to start 2024 with a nice level of inventory to supply the demand that we expected in 2025.

The next question. Are the 900 tons of castor seed supply in addition to the 400 ton expansion you reported on your Q1 earnings call. Or is the total supply now 900 tons?

So the total supply is 900 tons.

The next question how much, if any, of the $4.2 million in revenues were from sales, seed sales?

As I mentioned in my part, only a small portion from the orders we received in 2023 were delivered. So from this, you can understand that only a small portion from the revenue from this quarter is attributed from Casterra activity. There are some revenue coming from Casterra activity, but it's very modest compared to what we are expecting to see in the second half of 2025 as we already disclosed.

Next question, please address competition faced by your CBP (sic) [ CPB ] platform?

So I would like to refer in general, to what -- why do we think that our technology is unique. I think that what we are doing in Evogene is that we are not just building a computational technology. It's all guided and we build it together with a group of biologists and chemists that actually are coming with the problems they are facing and they know about which the industry is facing. And we are really trying to address these type of problems in using our technology. And then when we are working with our partners, I think and also with our subsidiaries, this is bringing an additional validation to the technology and also help us to improve the technology all the time. And I think that the fact that in our company, and this is very rare to see it in other places, the fact that we have 3 tech-engine, one for genomics, any type of product, then microbials and then chemistry, and we are all managing it under the same umbrella. This has put us in a very, very unique position because in biology, in life science in general, it's all connected. It's all connected, and you can just focus on one fragment from the big story. So I think this is about unique Evogene technology. And you know what, lets our partners to be the proof. I mean, the number of partners that we are working with is getting bigger and bigger. Actually, it's really the -- our first tier type of companies such as Corteva, Bayer, Syngenta, ICL and I think this is just the beginning. I believe that there will be more that we -- our subsidiary or even Evogene will direct -- is going to work with. So I truly believe that we are offering something different from what exists today in the market.

There are no further questions at this time. Mr. Haviv, would you like to make your concluding statement?

Yes. I would like to say thank you for everybody for participating in this analyst call. I think that we had a great first quarter in this year. We are looking forward to continue and to update you on the next achievement of our company and subsidiaries at the next analyst call. Thank you very much, and have a great day.

This concludes Evogene's First Quarter 2024 Results Investor Webinar. Thank you for your participation. You may go ahead and disconnect.