Plant Impact Regulatory News (PIM)

15 December 2017

Plant Impact plc

("Plant Impact", the "Company" or together with its subsidiaries, the "Group")

AGM Trading Update

Plant Impact plc (AIM: PIM), which leads research and development in crop enhancement technology to create products that growers can rely on to increase the yield and quality of their crops, will hold its Annual General Meeting ("AGM") today at 12.00 noon at the Rothamsted Conference Centre in Harpenden.

Ahead of the AGM, the Group announces the following trading update for the year to date. This update follows the announcement made on 13 December 2017 when the Company informed the market of important developments with Bayer CropScience ("BCS") and announced that it was evaluating all potential strategic options and entering a formal sales process. 

Operational update

Good progress continues to be made in the R&D activities of the Company. Since the start of the new financial year on 1 August 2017, four new compounds have completed lab and glasshouse assays in our early stage research work ("Discovery") and progressed to the next development stage. All four compounds show significant early yield indications and these compounds are now scheduled for more extensive development stage trials. One of the new compounds showed particular potential in our S1 seed treatment project and the other three showed promise as part of the F1 foliar spray project. 

Discovery work in collaboration with Ghent University is progressing well, with trials demonstrating that novel Pyrabactin analogues can control the aperture of leaf stomata and thereby reduce water loss. This intervention to improve the efficiency of a plant's water use could increase yield in drought conditions. 

Later stage R&D work includes important new trials underway in Brazil of the full portfolio of four individually proven soybean crop enhancement products and projects. For the first time, the combined effect of the full portfolio on soybean yield will be tested, targeting an uplift of over 15% in total yield improvement. Separate trials of S1 and F1 project formulations are also underway in Brazil and Argentina.

In Brazil, as announced on 13 December 2017, BCS has informed the Group that it will not be able to conclude a new contractual arrangement for Veritas® distribution until Q1 2018 at the earliest and that it will defer the purchase of further Veritas® volumes. Please refer to the Formal Sale Process paragraph below for further details.

Notwithstanding this recent development, we are continuing to work with BCS in the field in Brazil, to build the Veritas® business. Campaign activity is underway for the 2017/18 soybean and drybean growing season. The expectations of both ourselves and BCS are for good grower adoption of the product. Additionally, following trials of Veritas® on cotton plants in Brazil 2016/17, BCS intends to launch a commercial campaign for selected customers in the Mato Grosso and Bahia regions in 2018, which is based on proven yield uplifts of around 5 -7%, consistent with those seen in soybean.

In the USA, following the first season of product sales of Fortalis®, relationships with a network of key regional and national distributors are developing well, with coverage of every soybean-growing State already agreed for the 2018 US growing season.

In Argentina we are gearing up for the launch of the first full season of Fortalis® sales as a Plant Impact branded product. Arrangements are being put in place with local partners to provide distribution capability across the key soybean growing regions.

New partnership and product launch in Brazil

We are today announcing a new partnership with Albaugh Brazil ("Albaugh"). This partnership is separate to, and has no impact on, our relationship with BCS in Brazil to distribute Veritas®. Under a new distribution agreement, Albaugh will exclusively commercialize certain other Plant Impact technologies as Albaugh branded products, which will be offered through its extensive dealer network in Brazil targeting growers in the primary soybean, corn, cotton and coffee growing regions. The partnership will begin with the launch and regional test marketing of Fortiori®, a new Albaugh branded product based on a Plant Impact formulation. Fortiori® resolves a significant issue for growers due to "in-tank" antagonism between glyphosate herbicides and foliar-applied manganese nutrients.

Appointment of Interim Chief Financial Officer

The Board is pleased to announce that Ib Jensen today joins the Company in the non-Board position of Interim Chief Financial Officer and Company Secretary. Mr Jensen is a senior finance professional who has worked in a number of businesses and industries over a 25 year career. For the past ten years he has held a number of roles with Syngenta, the agricultural chemical multi-national, including four years from 2012 to 2016 based in Brazil as the CFO of its Latin American business. 

As previously announced on 6 October 2017, Richard Amos, the current CFO will be resigning from the Board at the conclusion of today's AGM. He will remain employed by the business until 9 February 2018 to ensure an efficient handover to Mr Jensen.

Formal Sale Process

The Company announced on 13 December 2017 that it had decided to investigate all potential strategic options for the business, including refinancing, potential divestment of selected assets or the sale of the Company. The Board has appointed Peel Hunt LLP as its financial adviser for this process, which includes the Company entering a formal sale process as referred to in the City Code on Takeovers and Mergers (the "Takeover Code").

As detailed in the 13 December 2017 announcement, the Company's reason for investigating all options is a consequence of BCS's decision to defer the purchase of further Veritas® volumes, which will have a material adverse effect on the Company's financial performance and on its cash resources.

Full details can be found in the 13 December 2017 announcement. At this time, there is no further update to that statement.