Davis, California, USA
August 10, 2015

Arcadia Biosciences, Inc. (NASDAQ: RKDA), an agricultural technology company with more than 50 pipeline products focused on generating higher yields for farmers through controlling abiotic stress in plants, today released its financial and business results for second-quarter and first-half 2015.

The company’s loss from operations of $3.5 million in the second quarter of 2015 was a 29 percent improvement over the loss from operations in the second quarter of 2014 as a result of slightly higher product and license revenues and a lower level of operating expenses. For the first half of 2015, the operating loss of $7.3 million was a 4 percent improvement on a comparative basis, as reduced operating expenses offset lower revenues.

“Operating performance from the first half of the year and our first quarter as a public company are in line with our expectations, and we are comfortable with our relatively stable level of revenues and expenses in the near-term,” said Eric Rey, president and CEO of Arcadia. “Longer-term, our financial success will be a function of our ability to advance our later-stage pipeline products toward commercialization while continuing to carefully manage operating expenses.”

“The key regulatory approvals, technology achievements, and new partnerships achieved so far this year underscore our ability to advance our pipeline through global regulatory systems, effectively manage extensive field testing, and expand our major global partnerships,” added Rey. “We have created a differentiated model for bringing major yield enhancements to growers globally, and we are focused on accelerating and expanding that potential.” 

Revenues

In the second quarter of 2015, revenues were $1.4 million as compared with revenues of $1.3 million in the second quarter of 2014, a 10 percent increase. The quarter-over-quarter growth was the result of increases in product and license revenues, which offset a decrease in revenues from contract research and government grants. In the first half of 2015, overall revenues decreased to $2.2 million from $2.7 million as a result of lower revenue from contract research and government grants.

Operating Expenses

In the second quarter of 2015, operating expenses were $5 million, down from $6.3 million in the second quarter of 2014, a 21 percent improvement. For the first half of 2015, operating expenses were $9.5 million as compared with $10.3 million during the same period in 2014, a 7 percent reduction. These decreases in operating expenses were a function of lower research and development (R&D) and selling, general and administrative (SG&A) expenses, primarily resulting from the absence of significant one-time expenses, which were incurred in the second quarter and first half of 2014.

Net Loss and Comprehensive Loss

Net loss and comprehensive loss for the second quarter of 2015 was $3.7 million, a 37 percent decrease from the second quarter of 2014. Net loss for the first half of 2015 was $9.5 million, a 2 percent increase over the first half of 2014. The net loss in the first half of 2015 included the effect of higher interest expense, but also was materially impacted by non-cash adjustments to the value of financing-related derivatives, which occurred in the first quarter. Additionally, the 2015 net loss included the effect of a higher income tax provision, while the 2014 first half included a non-cash loss generated by Arcadia’s Limagrain Cereal Seeds LLC joint venture.

Net Loss Attributable to Common Stockholders

Net loss attributable to common stockholders for the second quarter of 2015 was $4.6 million, or a loss of 19 cents per share, a 28 percent decrease from the second quarter of 2014. The net loss for the first half of 2015 was $12.3 million, or a loss of 94 cents per share, a 25 percent increase from the first half of 2014. The net loss attributable to shareowners included significant non-cash adjustments associated with Series D financing redemption rights and deemed dividends to a warrant holder. The number of diluted shares outstanding used to calculate the per-share losses attributable to common stockholders is weighted and reflects the company’s change from a private to a public company.

Business and Technology Update

“Our key achievements in the second quarter of 2015 were a combination of advancing our pipeline toward commercialization and filling our pipeline with promising new traits,” said Rey. “While not reflected in our current financial results, we continue to make progress on the business, regulatory, and technology aspects that make up the critical components of the long-term value of our pipeline.”

During the second quarter of 2015, Arcadia achieved several key business milestones, including:

• April 2015 – Argentinian Regulatory Approval Of HB4 Stress-Tolerant Soybeans. Through its Verdeca joint venture with Bioceres, Arcadia received approval from Argentina’s National Advisory Commission on Agricultural Biotechnology (CONABIA), concluding that Verdeca soybeans containing the HB4 trait are as safe for the environment as conventional soybeans. This was the world’s first regulatory approval for a stress tolerance trait in soybeans.
• April 2015 – Dow AgroSciences Soybean Trait Collaboration. Arcadia and Bioceres, through their Verdeca joint venture, signed a key agreement with Dow AgroSciences to develop and commercialize innovative traits in soybeans, combining Verdeca’s agronomic performance and product quality traits with Dow AgroSciences’ herbicide tolerance and insect resistance traits.
• June 2015 – U.S. Food and Drug Administration (FDA) Early Food Safety Evaluation For Nitrogen Use Efficiency Trait. The FDA completed its Early Food Safety Evaluation (EFSE) process for alanine aminotransferase, the plant protein responsible for the company’s Nitrogen Use Efficiency (NUE) trait. This critical approval lays the foundation for NUE regulatory approvals for all crops globally.
• June 2015 – Phytola Collaboration To Increase Oil Content In Soybeans. Arcadia announced its collaboration with Phytola, a leader in oilseed crop research, to develop soybean varieties with higher value due to increased oil content.
• June 2015 – FDA Approval of GLA Safflower Meal For Use In Animal Feed. The FDA approval of GLA safflower meal for use in animal feed opened up new markets for a by-product of the company’s GLA safflower oil manufacturing process, improving production economics of the product.
• April 2015 – Study Showed NUE Trait Increases Biomass In Sugarcane. The South African Sugarcane Research Institute (SASRI) published a study in the peer-reviewed journal Plant Cell Reports that showed significant improvements in plant growth parameters and biomass in sugarcane lines incorporating Arcadia’s NUE trait.

Website: http://www.arcadiabio.com

Published: August 10, 2015