Zwijnaarde, Belgium
May 16, 2008
Devgen NV (Euronext Brussels: DEVG), a public agricultural
biotech and seed company, today reports on progress made in
implementing its agro strategy during the first quarter of 2008
and on key financials for this period.
Update on business activities
The increasing interest in the worldwide need for rice, grain
and edible oil strengthens Devgen in its belief in a positive
strategic outlook for the traits and seed industry. Apart from
an expected increase in productivity for these crops, there is
also a need for higher yielding seed varieties to meet the
demand.
Devgen is successfully implementing its biotech and seed
strategy. Since the acquisition of its hybrid rice and other
hybrid seed business activities in November in India, Devgen's
India management team was completed. Bipin Solanki was appointed
as CEO of Devgen Seeds and Crop Technology pvt ltd. In addition,
a sales manager and a marketing manager, both bringing broad
experience, have been appointed.
Hybrid rice breeding activities in India and Kenya have been
integrated to accelerate the development of new rice hybrid seed
varieties for the Indian and Southeast Asian market.
Devgen successfully completed the field production season for
hybrid rice, sorghum and pearl millet hybrid seeds for the 2008
sales season. In March a custom built seed processing plant with
additional warehousing capacity became operational. Devgen is
now shipping 21 hybrid seed products into the market across
India under the Frontline and Mahalaxmi brands.
The sales team has been strengthened in key territories and took
a promising start for the 2008 Kharif season. Devgen maintains
its guidance for targeted sales of EUR 5 to 6 million in 2008.
The company is preparing for aggressive sales growth with its
current product portfolio and through market introduction of new
superior sorghum, pearl millet, rice and sunflower hybrids in
2009. The quality of these new hybrids will be widely
demonstrated to farmers and distributors across the key markets
during the coming Kharif season through demonstration trials.
In line with the previously announced strategic development
plan, Devgen finalized the trials for the compilation of the
first registration dossiers of its candidate nematicide product
in key geographies being the USA and Southern Europe. Target
date for the completion of the dossier compilation for the key
geographies is set by year end. The nematicide management team
was further strengthened with experts recruited out of the
agrochemical industry, to increase Devgen's capabilities with
regard to product support and market launch.
The process for focussing on the agro activities of the company
is ongoing. Further news will be announced in due course.
Key financials 31.3.2008
| € 000 |
31.03.08 |
31.03.07 |
| Revenue |
1,107 |
2,095 |
| EBITDA |
-5,796 |
-2,436 |
| Loss from operations |
-6,436 |
-2,702 |
| Net loss |
-6,172 - |
2,539 |
| Cash and cash
equivalents[1] |
40.736 |
51,053 |
[1] Including restricted cash for
an amount of EUR 5,082 ('000),
Revenues amount up to EUR 1,107
('000) compared to EUR 2,183 ('000) for the first quarter of
2007. Revenues are down due to lower income out of collaborative
research. Sales of seeds for the first quarter amount to EUR 70
('000). Sales of seeds will mainly be realised in Q2 and Q3.
EBITDA amounts to EUR -5,796 ('000) compared to EUR -2,436
('000) for the first quarter of 2007. EBITDA is impacted by
lower revenues (EUR -988 '(000)) and higher costs (EUR +2,373
('000)). R&D expenditure amounted to EUR 4,849 ('000) compared
to EUR 3,639 ('000) during the same quarter last year,
representing an increase of EUR 1,210 ('000) in line with
guidance given with regard to accelerated investments in the
nematicide program in 2008 and acceleration of the breeding
activities to bring new hybrid seeds to market. Other costs
including cost of goods sold, marketing and distribution
expenses and G&A, for both India and Belgium, amounted to EUR
2.055 ('000) compared to EUR 838 ('000) over the same period
last year (Belgium only).
Loss from operations amounts to EUR -6,436 ('000) compared to
EUR -2,702 ('000) for the same period last year due to lower
revenue and higher costs as explained above. Net loss amounts to
EUR -6,172 ('000) compared to EUR -2,539 ('000) for the same
quarter last year.
Cash and cash equivalents1 at the end of the first quarter
amounted to EUR 40,736 ('000) compared to EUR 43,863 ('000) at
the end of 2007. Net decrease in cash and cash equivalents
during the first quarter amounts to EUR 3,180 ('000) of which
EUR 3,201 ('000) is relating to cash used in operating
activities.
About Devgen
Devgen is a public agricultural biotech and seed company focused
on developing and commercializing:
• biotech traits and hybrid seeds to meet the growing needs for
high yielding, high quality hybrid rice, sorghum, millet and
sunflower of the Indian and other south-east Asian markets;
• a novel generation of biotech products to protect a wide
spectrum of crops from damage incurred from pests; to render
crops more tolerant against stress factors such as drought and
salty soils and to decrease the need for fertilizer use by
optimizing nitrogen uptake;
• a new generation of agro-chemical products to protect crops
from damage inflicted by plant parasitic nematodes.
Devgen's biopharmaceutical division develops a new class of
preclinical drug candidates, based on novel therapeutic
concepts, for treatment of a range of inflammatory and metabolic
disease (diabetes, obesity) and arrhythmia.
Incorporated in 1997, Devgen has offices in Ghent (Belgium),
Singapore, Hyderabad (India), and Delaware (US) and employs more
than 180 people worldwide. Devgen is listed on Euronext Brussels
(ticker: DEVG) since June 2005. For more information on Devgen,
please visit the company's web site:
www.devgen.com. |
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