S&W Seed Company Q3 FY2024 earnings call

• Double Team sorghum technology is on track to be on over 10% of U.S. green sorghum acres this year, with revenue expected $11.5M to $14M for fiscal 2024. It launched into forage sorghum market with ~$500k sales in intro year.
• International operations face disruptions in MENA region with $6M to $7M revenue impact and $3M to $4M impact in Australia pasture products. Efforts made to mitigate adjusted EBITDA shortfall through cost-saving initiatives.
• Vision Biofuels Oilseeds (VBO) signed exclusive license for glufosinate-resistant Camelina trait, pivoting efforts to fast-track it into products, with precommercial demos in 2024-2025, commercial launch in 2025, and wide-scale in 2026.
• Sold remaining portion of Australia partnership with Trigall Genetics, receiving $1.4M and reducing research and OpEx expenses.

Total revenue for Q3 2024 was $18.3 million. Sorghum sales were $8.3 million, with Double Team at $3.4 million. International forage sales were $6.9 million, and Americas forage sales were $2.8 million. Sorghum related revenue is expected to be between $22 million and $23 million, with Double Team within $11.5 million to $14 million. U.S. forage operations revenue is about $9 million. Adjusted for international impacts, total revenue is expected to be between $35 million and $37 million.

• Fiscal 2024 revenue expected $67M to $70M (down from previous $76M to $82M) due to international disruptions. Sorghum related revenue $22M to $23M, Double Team $11.5M to $14M. U.S. forage revenue ~$9M. Adjusted EBITDA expected negative $6M to negative $8.5M (previously negative $4M to negative $7.5M).

• Geopolitical disruptions in MENA region causing transition of Alfalfa growers to wheat and discontinuation of import permits for forages, impacting $6M to $7M in revenue.
• Supply shortage in Australia pasture products leading to $3M to $4M revenue reduction in Q3 and Q4 of fiscal 2024.
• Commodity market changes affecting sorghum acreage and Double Team revenue.

Q: Ben Klieve asked about OpEx investment for Double Team growth.

A: Mark Herrmann said growth can be achieved with combined brand and licensed approach, using 15 independent seed companies and working with global market leaders via license agreements with limited OpEx increase.

Q: Ben Klieve asked about variables driving Double Team revenue guidance.

A: Mark Herrmann said commodity market changes and sorghum acreage are key variables, with biggest risk being market and cropping conditions affecting sorghum acres.

Q: Ben Klieve asked about Trigall Genetics.

A: Mark Herrmann said $1.4M received from exiting Trigall, with $200k OpEx savings, and evaluating international Australia business for cost-cutting.

Q: Kurt Caramanidis asked about VBO and S&W liquidity.

A: Mark Herrmann and Vanessa Baughman said Shell's $6M payment and Trigall's $1.4M help cover cash needs, with focus on streamlining costs and improving efficiencies for next year.