Cibus, Inc. Q2 FY2025 earnings call

• Laser-focused on delivering near-term revenues with progress across rice and partner-funded sustainable ingredients programs, including biofragrances positioning for 2026 revenue.
• Rice herbicide tolerance traits HT1 and HT3 have potential $200M+ annual royalty revenue in US and Latin America, targeting Latin America launch in 2027 and US in 2028.
• Regulatory progress: EU trialogue discussions expected to resolve within 6 months, positive determinations in Ecuador, ongoing approvals in Americas, and regulatory clarity in India/Asia.
• Canola programs: HT2 field trials show promising results, Sclerotinia resistance program attracts interest; soybean platform has proof of concept for HT2 trait with potential large market access.
• Altered lignin alfalfa trait cleared by FDA, allowing commercialization of first gene-edited alfalfa varieties in US.

In the second quarter of 2025, revenue was $933,000 compared to $838,000 in the year-ago period, driven by increased activity in partner-funded programs. Research and development expense was $12.2 million for the quarter, down from $13 million the previous year, primarily due to cost reduction initiatives. Selling, general, and administrative expenses were $6.6 million, a decrease from $9.3 million the prior year, also due to cost reductions. Net loss was $26.6 million, down from $28.5 million in the year-ago period. Revenue contribution is mainly from partner-funded programs, with R&D and SG&A expenses reduced through cost-saving initiatives.

• Aim to reduce annual net cash usage to approximately $30 million by 2026 through disciplined capital allocation.
• Initial biofragrance revenues expected in 2026 with commercial expansion thereafter.
• Rice traits targeted for Latin America launch in 2027 and US launch in 2028, with potential $200M+ annual royalty revenue from rice traits alone.

• Regulatory uncertainties in the EU trialogue process could delay commercialization timelines.
• Cash burn risks if revenue targets from biofragrances and rice traits are not met as expected.
• Dependence on partnerships for development of certain traits, which could face challenges in securing funding or partner interest.

Q: What about the germ plasm transfer that occurred this quarter? Is it a customer initiating field trials on their own or providing new company-specific field trials?

A: Peter hands off to Greg who states it's a new customer delivering back multiple lines with HT3 trait for field trials going forward.

Q: On EU regulatory discussions, how long until companies sell into EU or via trade, and quantify EU opportunity?

A: Peter states EU legislation expected to finalize in next 6 months, with commercialization in EU potentially starting around 2027, and EU representing a large greenfield opportunity for traits as they missed out on GMOs previously.

Q: When will we see drop in expense to $30 million by 2026 and any net proceeds from biofragrances?

A: Peter mentions reduction in force and other initiatives already reducing spend, with net proceeds from biofragrances starting with scale-up material in 2026 moving to royalty model next year.

Q: On EU regulatory and RTDS technology differentiation?

A: Peter and Greg discuss EU regulatory progress expected in next 6 months, and RTDS technology's single-cell system and ability to make complex edits as a differentiator compared to others.