Cibus reports Q4 2024 financial results and provides business update

Cibus, Inc. (Nasdaq: CBUS) (the "Company"), a leading agricultural biotechnology company that uses proprietary gene editing technologies to develop plant traits (or specific genetic characteristics) in seeds, announced its financial results for the quarter ended December 31, 2024, and provided a business update. 

Management Commentary

"I am energized by the momentum we're building across our key markets," stated Peter Beetham, Co-Founder, Interim CEO, President and COO. "The opportunities for our gene-edited traits aren't years away – they are materializing now. Our herbicide tolerance traits in Rice are generating commercial interest across markets including Uruguay, Colombia, Brazil, Asia and the United States, representing significant potential future royalties when peak sales are achieved following commercial availability. With our traits moving into customer germplasm and field trials showing promising results, and with the regulatory environment for gene-edited traits making significant positive progress, including especially in the EU, I believe we are positioned to capture significant value for our shareholders."

"What differentiates Cibus is our proprietary Rapid Trait Development System™ (RTDS^®) gene editing process which enables us to edit a customer's elite germplasm and return it with a specific trait in under 12 months, creating a time bound and predictable model for trait development and commercialization that's unlike anything agriculture has seen before. This is the significant value of our standardized platform – rapidly delivering traits to seed companies that in turn help farmers address their most pressing productivity challenges while positioning Cibus to capture the significant commercial value that will follow."

Commercial Progress

Progress of Cibus' Developed Traits

• Weed Management (HT1 and HT3) in Rice

• In December 2024, affirmed collaboration with RTDC Corporation Limited and Albaugh LLC to provide Clethodim as part of Cibus' weed management solution for U.S. rice farmers using Cibus' HT3 trait. This collaboration supports Cibus' herbicide resistant rice trait commercialization efforts as it continues work with U.S. rice seed customers.

• Including Cibus' second quarter 2024 agreement with FEDEARROZ, Cibus has agreements with four customers, including major Rice seed companies in North and Latin America to have Cibus' HT traits placed in their elite germplasm as they move toward potential commercialization.

• Received germplasm from all four Rice customers.

• Completed a successful field trial in the US with a customer's germplasm.

• Received initial field trial results for stacked gene edited herbicide tolerance traits in Rice; we believe this is the first trial use of stacked gene edited herbicide tolerance traits in Rice to improve weed management.

• Pod Shatter Reduction (PSR) in Canola and Winter Oilseed Rape (WOSR)

• Completed successful initial PSR field trials for WOSR in the UK for multiple customers, an important milestone in furthering Cibus' commercialization efforts for WOSR in Europe.

• Planted next round of UK field trials in the third quarter of 2024 and expect to receive data in 2025 harvest season.

Progress of Cibus' Advanced Traits and Sustainable Ingredients

• Sclerotinia Resistance

• We've made substantial advances in our disease resistance program. In November, we announced a collaboration with Biographica, a UK-based leader in AI and machine learning for gene discovery, focused on advancing disease resistance in Oilseed Rape and Canola. This partnership leverages Biographica's proprietary AI platform to complement Cibus' own computational biology team to identify and prioritize completely novel genetic targets for gene editing.

• In November 2024, successfully completed edits in Canola for the fourth mode of action (MOA) in Canola, with early controlled environment results expected in the first quarter of 2025.

• In March 2025, announced positive greenhouse data for Canola plants containing the third mode of action

• Received field trial results for second mode of action in Canola showing enhanced disease resistance.

• The final trait aims to provide durable resistance through the combination of multiple modes of action informed by field results for each individual MOA.

• Herbicide Tolerance (HT2)

• Received positive greenhouse data for second generation HT2 edits in Canola, enabling advancement to the field.

• Sustainable Ingredients

• Continued progress toward our current partner-funded project with a large multi-national consumer packaged goods (CPG) company focused on developing certain alternative low carbon sustainable ingredients to meet the functional needs of the CPG industry aimed at mitigating adverse environment impacts during production, use, or disposal.

• In 2024 and the first quarter of 2025, the Company made good progress on its bio-based fermentation biofragrance products and now expects to contract with CPG partners to commercialize.

Progress within Crop Platforms

• Soybean Platform

• In January 2025, the Company successfully edited a Soybean cell for its HT2 trait, achieving sufficiently high editing rates that enabled expanded development of its Soybean platform. The Company continues to work diligently toward a fully operational Soybean platform.

Corporate and Industry Progress

• Standardized RTDS gene editing process for industrialized breeding

• In January 2025, established production standards for its proprietary RTDS gene editing process for Cibus' developed traits in Rice and Canola, as well as advanced traits in Canola. In each of these cases, Cibus believes that it can edit a customer's elite germplasm or seed and return it to its customer with a specific edit within 12 months.

• Global regulatory progress for gene editing technologies continues to advance

• During the California Rice Commission's Rice Certification Committee Meeting on February 26, 2025, the Commission approved Cibus' field research proposal marking the first time gene edited rice has been authorized for planting in California

• On March 14, 2025, EU member states endorsed the EU Council's (the "Council") negotiating mandate on the regulation of plants obtained by NGTs. This important advancement enables the Council to engage in 3-way discussions (known as trilogue discussions) with the EU Parliament and the European Commission to agree the final text of the legislation to be proposed for final adoption. The legislation is part of a package of measures designed to ensure the sustainable use of natural resources and to strengthen the resilience of EU food systems. It describes a category of NGTs, that include products of gene editing that could be obtained in nature or by conventional breeding. If successful, the proposed regulation would enable EU growers to benefit from improved varieties and would help facilitate international trade by bringing EU policy closer to that of trading partners in North and South America, the United Kingdom, India, Australia and Japan.

• In May 2024, the Canadian Food Inspection Agency (CFIA), Animal Feed Division published updated guidelines outlining the CFIA's approach to regulating feed products/ingredients from gene editing like those developed through conventional breeding.

• Completed a registered direct offering for gross proceeds of $22.6 million in January 2025

• Proceeds will be used to fund further development of the Company's pipeline of productivity traits and for working capital and general corporate purposes.

• Initiated actions in support of advancing streamlined commercial strategy

• Announced in October 2024, included actions to achieve $10 million in cost savings on an annualized run-rate basis; facility consolidation remains on track.

• When these and other initiatives are fully implemented by early 2025, the Company expects them to translate to a reduction in monthly cash use by approximately 20%.

• The Company incurred a one-time charge associated with severance expenses in the fourth quarter of fiscal 2024.

• Expansion of IP coverage for plant gene editing and traits

• In 2024, Cibus received additional patents across 10 plant gene editing and trait families, further strengthening the Company's IP portfolio including in its Pod Shatter Reduction and Herbicide Tolerance trait families.

• The IP expansion covers gene editing, productivity traits and quality traits that strengthen Cibus' patent coverage in geographies including, but not limited to, Europe, Asia, Latin America, and North America.

Expected Milestones

Cibus intends to report ordinary course development progress and achievements in connection with its quarterly reporting process. Cibus presents below the most significant development and commercial milestone targets for its priority programs for 2025:

• Rice:

• Expansion of commercial relationships with Rice seed companies across North and South America.

• Expect first trait validation trials in Latin America.

• Expect to prepare delivery of initial traits to a Latin American customer by end of 2025.

• Soybean Platform:

• Expect HT2 edits in Soybean plants in 2025, building upon successful edits in Soybean cells earlier in 2025.

• Sclerotinia:

• Field trials for third and fourth modes of action in Canola planned for 2025.

• Expect early results from controlled environment testing for fourth mode of action in Canola in first quarter 2025.

• HT2 in Canola:

• Expect initial field trial data in 2025.

• Sustainable Ingredient Development:

• Continue progress on our partner-funded project to develop sustainable low carbon ingredients or materials for the CPG industry that do not negatively impact the environment during production, use, or disposal.

• Expect to receive nominal revenues associated with the ongoing commercialization efforts for the Company's sustainable ingredient biofragrance products.

Fourth Quarter 2024 Financial Results

As a reminder, the business combination of Cibus, Inc. (formerly known as Calyxt, Inc. prior to the business combination) (Legacy Calyxt) and Cibus Global, LLC was completed on May 31, 2023, thus the first five months of the 2023 information provided in the Financial Results, Condensed Consolidated Statements of Operations, and Condensed Consolidated Statements of Cash Flows is that of Legacy Calyxt only. Year-over-year comparisons are not comparable as 2024 includes the combined company whereas 2023 only includes Legacy Calyxt for the first five months.

• Cash position: Cash and cash equivalents as of December 31, 2024, was $14.4 million. Taking into account the $21.4 million net proceeds received in 2025 from the registered direct offering in January 2025, the impact of implemented cost saving initiatives, and without giving effect to potential financing transactions that Cibus is pursuing, Cibus expects that existing cash and cash equivalents will fund planned operating expenses and capital expenditure requirements into late in the third quarter of 2025. Cibus' Board, together with its financial advisor, continues to evaluate a full range of strategic alternatives to maximize shareholder value.

• Research and development (R&D) Expense: R&D expense was $12.4 million for the quarter ended December 31, 2024, compared to $14.2 million in the year-ago period. The decrease of $1.8 million is primarily due to lower non-cash stock compensation expense and the strategic realignment and reduction in force announced during the fourth quarter of 2023 which included decreases in personnel costs.

• Selling, general, and administrative (SG&A) expense: SG&A expense was $6.8 million for the quarter ended December 31, 2024, compared to $6.8 million in the year-ago period. There was a nominal increase related to an increase of approximately $1.0 million in professional fees which was offset by a decrease of $1.0 million in personnel expenses.

• Goodwill impairment: Goodwill impairment was zero for the quarter ended December 31, 2024, compared to $249.4 million in the year-ago period. The decrease of $249.4 million non-cash expense is due to the impairment of goodwill in the fourth quarter of 2023.

• Royalty liability interest expense – related parties: Royalty liability interest expense – related parties was $8.2 million for the quarter ended December 31, 2024, compared to $8.1 million in the year-ago period. The increase is due to increase in the royalty liability balance.

• Non-operating income, net: Non-operating income, net was income of $0.4 million for the quarter ended December 31, 2024, compared to expense of $0.1 million in the year-ago period. The increase in income of $0.3 million is driven by the fair value adjustment of the liability classified common warrants.

• Net loss: Net loss was $25.8 million for the quarter ended December 31, 2024, compared to $277.2 million in the year-ago period. The decrease of $251.4 million in net loss was driven by the $249.4 million non-cash goodwill impairment in the fourth quarter of 2024. Without the goodwill impairment, net loss decreased by $2.0 million primarily related to the items described above.

• Net loss per share of Class A common stock: Net loss per share of Class A common stock was $0.87 for the quarter ended December 31, 2024, compared to net loss per share of Class A common stock of $12.59 in the year-ago period. The decrease of $11.72 in net loss per share of Class A common stock is primarily driven by the non-cash goodwill impairment in the fourth quarter of 2023 which accounted for approximately $11.32 in net loss per share of Class A common stock and by the decreases in net loss described above and a year-over-year increase in weighted average shares outstanding.