Origin Agritech Limited

Thank you for standing by, and welcome to the Origin Agritech Fiscal Year 2025 Results Conference Call. Please note that today's call is being recorded. It is now my pleasure to introduce Matthew Abagnante of Strategic Investor Relations.

Thank you, Operator, and thanks to all of you for joining us today on the Origin Agritech Business Update Conference Call. Joining us on the call today are Mr. Wei Bin Yan, Chief Executive Officer, and Mr. Patrick Chang, Chief Financial Officer. Before we begin, I would like to remind our listeners that any statements on this call that are not historical facts are forward-looking statements. Today's call includes forward-looking statements that address expected future business and financial performance and financial conditions. and contain words like expect, anticipate, intend, plan, believe, seek, will, would, target, and similar expressions and variations. Forward-looking statements address matters that are uncertain. Forward-looking statements are not guarantees of future performance and are based on assumptions and expectations which may not be realized. They're based on the management's current expectations, assumptions, estimates, and projections about the company and the industry, but involve a number of risks and uncertainties, many of which are beyond the company's control. Some of the important factors that could cause the company's actual results to differ materially from those discussed in forward-looking statements are failure to develop and market new products and optimally managed product life cycles, ability to respond to market acceptance, rules, regulations, and policies affecting our products, failure to appropriately manage process safety and product stewardship issues, changes in laws and regulations or political conditions, global economic and capital markets conditions, such as inflation, interest and currency exchange rates, business or supply disruptions, natural disasters and weather events and patterns, ability to protect and enforce the company's intellectual property rights, and separation of underperforming or non-strategic assets or businesses. The company undertakes no duty or obligation to publicly revise or update any forward-looking statements as a result of future developments or new information or otherwise, should circumstances change, that's otherwise required by securities and other applicable laws. Although the company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and actual results may differ materially from the anticipated results. You're urged to consider these factors carefully in evaluating the forward-looking statements contained herein. and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by these cautionary statements. And with that, I would like to turn the call over to our first speaker, Mr. Wei Bin Yan, Chief Executive Officer of Origin Agritech. Hello, Mr. Yan.

Thank you, Matthew, and thank you all for joining us today. I'm delighted to to speak with you about what has been a transformative year for Origin Agritech. It has been the first year for me to take the CEO role in the company from September 2024 to September 2025. If I had to capture the theme of this year in a single word, it would be recovery. We have achieved a full recovery of our team, our research capabilities, our seed production and processing facilities, and our sales network infrastructure. Origin Agritech is now ready for a new march forward onto our new leadership. In November 2024, we announced our three-stage strategic plan that the company is fully committed to executing. Stage one is recovery, spending calendar year 2025 and 2026. Stage two is to stand up, covering 2027 through 2029, Stage three is our return to an industry-leading position, which we aim to achieve from 2030 through 2032. We are confident in this roadmap and already seeing strong progress in stage one. Let me share our key accomplishments in 2025. Our senior leadership team is now fully in place and energized. We have recovered our team hearts from 68 to 97 professionals, a testament to our renewed ability to attract and retain top talents. We are also reshaping our digitalization efforts across the organization to drive efficiency and innovation. On the research front, we have made tremendous strides. We upgraded our Beijing station and the Sanyang station and opened a new station in Zhengzhou province. Zhengzhou is in Henan province. Our research facility in Guiyang, that's Guizhou province, is under construction and will be open and run in Q1, 2026. And we have mostly refilled our product portfolio, and our research pipeline is now stocked with the most competitive genplasms targeting the next generation of industry competition. The commercialization of GMO and the functional gene editing technology has been accelerated through a strategic alliance with the China Golden Mark. Our upgraded production and processing facility is now back to industry-leading standards. On the sales front, our team and the infrastructure have been greatly improved. We established a new sales force in the northern east China provinces, and our sales team and the entity restructuring have been mostly completed in December 2025. Additionally, Beijing Origin achieved its seed production operation license in December 2025, making another important milestone. And we are confident that the strategic decisions and the investments we made in 2025 have positioned Origin Agrotech for sustainable long-term growth and will deliver significant value to the farmers and our shareholders in the coming years ahead. Thank you. And I will turn the call over to our CFO, Patrick Chen, to discuss our financial results. Thank you, Matthew.

Thank you, Mr. Yang. I will reveal our financial performance for the fiscal year 2025. For fiscal year 2025, we reported total revenues of 91.3 million RMB or 12.9 million US dollars. This represents a 90% decrease from the previous year. This decline was primarily driven by two factors. First, a decrease in sales of non-proprietary seed varieties as we strategically shifted focus and temporarily reduced some external production services during the upgrade of our Xinjiang facility. Second, increased market competition for our legacy proprietary seed products. This resulted in a net loss attributable to origin of 53.3 million RMB or 7.5 million USD. It's important to note that our fiscal year 2024 results included a one-time gain from a subsidiary disposal which was not repeated this year. Turning to our balance sheet and cash flow, we ended the year in a strong liquidity positions. Our cash and cash equivalents increased by 89% to 15.9 million RMB. During the year, we successfully raised 5.38 billion USD through the sale of ordinary shares. These funds are being strategically deployed for working capital, market expansion, and facility upgrades. Net cash used in operating activities was $22.9 million RMB, reflecting our investment in inventory and operations. Net cash used in investing activities was $13.7 million RMB, primarily for the upgrades to our production facilities. Net cash provided by financing activities was 44.3 million RMB, largely from the capital raise. In summary, while our 2025 financial results reflect a period of transition and strategic investments, we have strengthened our balance sheet and allocated capital to the key drivers of future growth. We are confident that this investment in technology, infrastructure, and people will create significant value for our shareholders in the coming years. Thank you.

Thank you. This does conclude today's program, and we appreciate your participation. You may now disconnect.