I think so and if they can get some financing that does not kill them they can turn the corner IMO. Losing less and increasing rev.
The company reported that it has signed a collaboration and license agreement with a leading agricultural producer to introduce Ceres' biotech traits following positive results from greenhouse and field evaluations. Separately, the company announced that it has substantially increased plantings of its commercial forage sorghum hybrids in the U.S. over the prior year.
Ceres President and CEO Richard Hamilton noted that the company continues to realign its focus toward food and forage opportunities and biotechnology traits for sugarcane and other crops. "Our core technology platforms and biotech traits provide multiple opportunities for out-licensing by crop, geography and market. Our strategy is to continue to build our proprietary sorghum seed business while we advance our biotech traits and technology toward commercialization. As we demonstrated this quarter, the more advanced these traits and products are in our pipeline, the more valuable they can become."
Paul Kuc, Ceres Chief Financial Officer, reported that the company is actively reviewing a number of potential financing options and further cost reduction measures to extend its working capital. "We continue to closely monitor expenses and intend to make further cost reductions in order to direct greater resources toward improved forages for dairy and meat production and biotech traits for sugarcane and other crops."
Business Highlights and Outlook
For the 2015 growing season in North America, total plantings of Ceres forage sorghum hybrids are expected to cover more than 3,000 acres, compared to approximately 600 acres planted the previous season. The increase in planted acres is primarily due to an increase in the number of customers evaluating the company's products for potentially larger-scale use. Drought and water supply concerns in certain regions of the U.S. positively influenced customer planting decisions of Ceres' forage sorghum hybrids. The company also expanded field evaluations of its biotech traits in sorghum in the United States following successful field trials last season. Performance results for both its traditionally developed hybrids and biotech traits are expected by the end of the calendar year. Ceres added three additional seed distributors for its products in the U.S. and its territories.
Ceres has entered into a multi-year collaboration with a leading agricultural producer to develop improved crop varieties with higher yields, accelerated growth and greater resilience to drought conditions. The development and commercialization program will be fully funded by the company's collaboration partner. Payments to the company are expected to exceed $1 million by mid-2016. Ceres is also entitled to royalties for new cultivars commercialized under the agreement.
In May 2015, the company reported that its bioinformatics software, Persephone, was licensed to global seed potato developer, HZPC Holland BV. Persephone software is also being evaluated by new potential customers in plant genomics as well as in biomedical research and diagnostics, where genomics data is analyzed and viewed in a similar manner to plants.
In Brazil, the company announced in June a realignment plan consistent with its overall shift from bioenergy toward food and feed opportunities. Current cost reductions implemented under the plan are expected to deliver cash savings of up to approximately $4 to $5 million in fiscal year 2016, primarily through restructuring the company's Brazilian operations. Ceres expects to make additional cost reductions which are expected to save up to approximately $2 to $3 million in fiscal year 2016. The company is exploring discussions with additional local partners and collaborators to support the continued development and commercialization of its technology in Brazil. The company also plans to expand its sugarcane trait development activities for the Brazilian sugarcane market. Separately, the company reported that for the recently completed 2014-2015 sorghum growing season in Brazil, it had achieved continued progress from its product development pipeline, including the highest ethanol yields achieved to date at industrial scale by one of its sweet sorghum products. A number of its pre-commercial high biomass sorghum and sweet sorghum hybrids also met or exceeded field performance targets in multiple regions. Based on anecdotal reports, the company's commercial high-biomass sorghum plantings widely outyielded competing products this season at locations where side-by-side comparisons were available, however, yields were below company targets due, in part, to delays during planting and less than optimal harvest practices.
Third Quarter Financial Results
Total revenues increased by $0.3 million to $1.1 million for the quarter ended May 31, 2015 compared to the same period last year. Revenue from collaborative research and government grants increased by $0.3 million primarily due to the recognition of revenue following the completion of work under the company's various collaboration agreements. Product sales were relatively unchanged.
Total cost and operating expenses decreased by $1.5 million to $7.0 million for the quarter ended May 31, 2015 compared to the same period last year.
Cost of product sales increased by $0.3 million to $0.9 million for the quarter ended May 31, 2015 compared to the same period last year. Cost of product sales in Brazil increased by $0.2 million primarily due to increased expenses related to biomass produced under the company's sales incentive and promotional programs for the 2014-2015 growing season. In the U.S., expenses increased by $0.1 million primarily due to increased seed production costs for Ceres' U.S. sorghum business.
Research and development expenses decreased by $1.1 million to $2.5 million for the quarter ended May 31, 2015 compared to the same period last year primarily due to reduced personnel and related expenses in the U.S.
Selling, general and administrative expenses decreased by $0.2 million to $3.6 million for the quarter ended May 31, 2015 compared to the same period last year primarily due to reduced personnel and related expenses in the U.S. and Brazil.
For the quarter ended May 31, 2015, Ceres reported a net loss of $5.9 million, or $0.98 per share, compared to a net loss of $7.7 million, or $1.35 per share, for the quarter ended May 31, 2014.
At May 31, 2015, cash and cash equivalents and marketable securities totaled $9.1 million.
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