Yield10 Bioscience announces first quarter 2024 financial results

Date:05-20-2024

Yield10 Bioscience, Inc. (Nasdaq:YTEN) ("Yield10" or the "Company"), an agricultural bioscience company, reported financial results for the first quarter ended March 31, 2024.

"In the first quarter of 2024, we made the strategic decision to focus our resources on the commercialization of Camelina products targeting the aquafeed and nutritional markets for omega-3 fatty acids," said Oliver Peoples, Ph.D., President and Chief Executive Officer of Yield10. "We are building seed inventory in anticipation of commercial scale planting, planning to obtain regulatory approval to sell omega-3 oil for aquafeed in Chile, and engaging with potential commercial partners to enable future commercial sale of omega-3 oil and meal in target markets.

"We recently completed deliverables earning $1 million in milestone payments from Vision Bioenergy Oilseeds. Earlier this year, we granted a license to VISION related to our herbicide tolerance technology for Camelina. In recent months we have obtained clearances from both USDA-APHIS and the U.S. EPA allowing commercial planting of HT Camelina together with the use of glufosinate herbicide for the management of broad leaf weeds, representing a key milestone in the commercial development of Camelina."Yield10 is a leader in the development of Camelina as a commercial crop and in engineering novel traits into the crop. In April of 2024, Yield10 was granted a U.S. patent covering oilseed plants engineered with a complex, novel carbon fixation pathway and in May of 2024, the Company was granted a Notice of Allowance on C3004, a trait that increases photosynthesis driving increased branching and seed yield in Camelina. We expect this patent to issue in the second half of 2024.

"In the coming months, we plan to continue to execute on our commercial and regulatory plan to produce omega-3 oil and meal products in Camelina, to combine our herbicide tolerant and omega-3 traits to produce new Camelina varieties, and to continue to support grower adoption of Camelina," said Dr. Peoples.

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Recent Accomplishments

Recent progress by Yield10 is underscored by corporate milestones achieved since the start of 2024.

• On May 13, 2024, Vision Bioenergy Oilseeds, LLC (″VISION″) made an additional $1 million in milestone payments to Yield10 in connection with certain deliverables to VISION in accordance with the terms of our license agreement signed in February of 2024.

• Yield10 anticipates planting its omega-3 DHA1 (EPA+DHA) Camelina variety this fall as part of its seed scale-up program to build seed inventory to produce oil for sampling potential partners and future pre-commercial scale planting.  

• During the first quarter of 2024, the U.S. Environmental Protection Agency (″EPA″) approved an amendment to the label language of INTERLINE^® Herbicide to include the oilseed Camelina. This allows Yield10’s glufosinate-tolerant Camelina to be sprayed with INTERLINE^®, a glufosinate containing herbicide, providing farmers with a much-needed method to control broad leaf weeds during Camelina field production. INTERLINE^® is marketed by UPL, Ltd., a global provider of sustainable agricultural solutions.

• On April 23, 2024 the U.S. Patent and Trademark Office (″PTO″) granted to the Company U.S. Patent No. US 11,965,182 ″Plants with Enhanced Yield and Methods of Construction.″ In the patent, the Yield10 inventors describe engineering a complex carbon fixation pathway into Camelina as a representative oilseed plant. The patent supports potential use of complex metabolic engineering strategies to increase crop yield.

• In May of 2024, the U.S. PTO granted to Yield10 a Notice of Allowance for a patent application entitled "Genetically engineered land plants that express an increased seed yield protein and/or an increased seed yield RNA." This U.S. patent covers Yield10's C3004 trait, which has been shown to increase photosynthesis in Camelina and to produce more branching and seed yield in field tests reported by the Company.

FIRST QUARTER 2024 FINANCIAL OVERVIEW‍

Reverse Stock Split‍

On May 2, 2024, the Company effected a 1-for-24 reverse stock split of its common stock. Unless otherwise indicated, all share amounts, per share data, share prices, and conversion rates set forth in this press release and the accompanying condensed financial statements have, where applicable, been adjusted retroactively to reflect this reverse stock split.‍

Cash Position‍

Yield10 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 first quarter of 2024 with $1.6 million in unrestricted cash and cash equivalents; a net increase of $0.5 million from unrestricted cash, cash equivalents and investments of $1.1 million reported as of December 31, 2023. The Company used $0.9 million in cash for its operating activities during the three months ended March 31, 2024, in comparison to $2.7 million used for operating activities during the first three months of 2023. The net decrease in cash usage reflects the Company's continuing efforts to conserve cash resources by reducing expenses and delaying payments to vendors and the receipt of the initial $2.0 million paid by VISION upon execution of the commercial license agreement.

In February of 2024, Yield10 granted a commercial license to VISION for certain proprietary varieties of Camelina for the production of feedstock oil for biofuels and other markets excluding omega-3 oils and bioplastics. VISION will make cash payments to the Company totaling $3.0 million, of which $2.0 million was received as of March 31, 2024, and the remainder was paid by VISION during the second quarter of 2024 upon the Company's completion of certain near-term milestones.   In March 2024, the Company also entered into warrant exercise agreements with certain existing institutional investors, pursuant to which these investors agreed to exercise a portion of the warrants issued to them in May of 2023 and/or August of 2023. The Company received net proceeds of approximately $1.2 million from the exercise of the warrants, net of transaction expenses of $0.2 million incurred in completing the arrangement.‍

Operating Results

‍During the three months ended March 31, 2024, the Company recognized $0.3 million in license revenue from the agreement with VISION. The license agreement with VISION contains a number of service deliverables that the Company must meet in order to fulfill its contractual obligations. The Company will recognize the $3.0 million in revenue on a straight line basis through the estimated completion date of the final service deliverables estimated to occur through September of 2025.   Research grant revenue was $0.1 million for the three months ended March 31, 2023. Yield10 did not recognize grant revenue during the three months ended March 31, 2024, as the Company's five-year sub-award with Michigan State University in support of a U.S. Department of Energy funded grant was completed in March 31, 2023 with no further grant revenue to be recognized.

Research and development expenses were $1.4 million during the first three months of 2024 compared to $2.2 million during the first three months of 2023 and general and administrative expenses were $1.4 million during the first three months of 2024 compared to $1.7 million during the three months ended March 31, 2023. The decreased expenses quarter over quarter reflect the Company's efforts to better align its expenses with its cash resources.

Yield10 reported a net loss of $2.5 million for the three months ended March 31, 2024, or $4.77 per share, as compared to a net loss of $3.8 million, or $18.16 per share, for the three months ended March 31, 2023.

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