Yield10 Bioscience announces third quarter 2023 financial results

Date:11-15-2023

Yield10 Bioscience, Inc. (Nasdaq:YTEN) ("Yield10" or the "Company"), an agricultural bioscience company, reported financial results for the three and nine months ended September 30, 2023.

″During the third quarter of 2023, we established our ″Camelina Seed Genetics to Biofuel″ platform as we completed the harvest of spring and winter Camelina and delivered grain to a private biorefining company for processing into biofuel," said Oliver Peoples, Ph.D.President and CEO of Yield10 Bioscience. ″In this harvest cycle, Yield10 and our Camelina growers derived proceeds from the delivery of Camelina grain to our customer. Leveraging our grower network, we also completed a new cycle of Camelina grain contracting for winter 2023/2024. On the business development front, we continue to hold discussions with companies interested in establishing collaborations in biofuels to support the planting of Camelina on large acreage.

″Yield10 prioritized the development of herbicide tolerant ("HT") Camelina to provide farmers with a robust weed control package supporting the broad adoption of the crop in North America. We are awaiting regulatory responses from USDA-APHIS and EPA to enable the use of glufosinate for control of broadleaf weeds in Camelina cultivation. With positive field data in-hand and seed scale-up activities underway, we remain on track to launch our first herbicide tolerant Camelina variety as early as 2025.

″Producing omega- 3 fatty acids (EPA, DHA) in Camelina represents a potential game-changer for the omega-3 industry, enabling a plant-based, predictable supply of this nutritional ingredient. Based on our successful collaboration with Rothamsted Research, we are finalizing an exclusive, global commercial license to this advanced omega-3 technology in Camelina. Reflecting industry interest in new sources of omega-3, we recently signed a letter of intent ("LOI") with BioMar Group, a global aquafeed producer, to collaborate on the production of omega-3 fatty acids in Camelina. We are making meaningful progress on the regulatory front, and we are working to scale-up omega-3 Camelina seed production to support additional planting in 2024.

"In the coming months, we will continue our focus on securing agreements for the biofuel market and the omega-3 market, expanding commercial activities, advancing our HT and omega-3 Camelina varieties toward launch, innovating to introduce high-value traits into Camelina, and building shareholder value," concluded Dr. Peoples.

Recent Accomplishments

• Successfully established Yield10's "Camelina Seed Genetics to Biofuel" platform

• Generated initial proceeds from seed shipments to growers and grain shipments to a biorefiner customer

• Signed Camelina grower contracts for the winter 2023/2024 season with farmers in the United States and Canada

• Reported positive field test data for stacked HT spring Camelina and initiated seed scale-up in Chile

• Exercised Yield10's option with Rothamsted to finalize a global, exclusive commercial license to omega-3 advanced technology for Camelina

• Signed an LOI with BioMar Group, a global aquafeed producer, for a partnership aimed at producing omega-3 oil on land

• Performed initial acre-scale field work with EPA8 Camelina and initiated seed scale-up in Chile

THIRD QUARTER 2023 FINANCIAL OVERVIEW

Cash Position

Yield10 Bioscience is managed with an emphasis on cash flow and deploys its financial resources in a disciplined manner to achieve its key strategic objectives.

Yield10 ended the third quarter of 2023 with $2.8 million in unrestricted cash and cash equivalents; a net increase of $0.5 million from unrestricted cash and cash equivalents of $2.3 million reported as of June 30, 2023. The net increase in the Company's cash balance as of the end of the third quarter was the result of completing a public offering of common stock and warrants during August 2023 that resulted in net proceeds of $3.1 million after issuance costs.

Net cash used by operating activities during the third quarter of 2023 was $2.6 million compared to $2.7 million used in the third quarter of 2022. The Company continues to estimate total net cash usage for the full year ended December 31, 2023 in a range of $12.5 - $13.0 million, as a result of aligning its resources to further develop and commercialize its proprietary Camelina plant varieties for its two near-term markets; biofuel feedstock and omega-3 for use in aquaculture feed, pharmaceuticals and nutrition. Cash used for operating activities will continue to support seed scale-up and other pre-commercial Camelina production activities, as well as the expansion of the Company's crop trial programs focused on herbicide tolerance and higher yielding oil traits.

There is substantial doubt about the Company's ability to continue as a going concern. Yield10's cash and cash equivalents of $2.8 million as of September 30, 2023, will only fund its operations into early December 2023. The Company's management is urgently evaluating and pursuing different strategies to obtain the required funding for its operations in the near term. These strategies may include, but are not limited to: public and private placements of equity and/or debt, licensing and/or collaboration arrangements and strategic alternatives with third parties, and other funding from the government or third parties. There can be no assurance that these funding efforts will be successful. If Yield10 is unable to obtain funds by early December 2023 or on acceptable terms, the Company may be required to curtail its current development programs, cut operating costs, forego future development and other opportunities or even terminate its operations, which may involve seeking bankruptcy protection.

Operating Results

Yield10 did not record grant revenue during the three months ended September 30, 2023. As of March 31, 2023, the Company's work in support of its DOE sub-award with Michigan State University ("MSU") was completed, with no further revenue to be recognized from the grant. Grant revenue for the third quarter of 2022 was $0.1 million. Research and development expenses were $2.2 million and $2.1 million during the three months ended September 30, 2023 and three months ended September 30, 2022, respectively. During the three months ended September 30, 2023, we recorded $0.1 million in offsets to research and development expense from payments received or due to us from shipments of seed and harvested grain to growers and offtake partners that were completed during the period. General and administrative expenses were consistent at $1.5 million for both the quarters ended September 30, 2023 and September 30, 2022.

Yield10 reported a net loss of $3.7 million for the quarter ended September 30, 2023, or $0.41 per share, as compared to a net loss of $3.5 million, or $0.71 per share, for the quarter ended September 30, 2022.

For the nine months ended September 30, 2023, the Company reported a net loss of $11.2 million, or $1.70 per share, compared to a net loss of $10.3 million, or $2.09 per share, during the nine months ended September 30, 2022. Year-to-date grant revenue earned on the completed DOE sub-award with MSU totaled $0.1 million during the nine months ended September 30, 2023 and $0.4 million during the nine months ended September 30, 2022. Research and development expenses were $6.4 million and $5.9 million during the nine months ended September 30, 2023 and September 30, 2022, respectively. General and administrative expenses were $4.9 million and $4.7 million during the nine months ended September 30, 2023 and September 30, 2022, respectively.