S&W Seed Co (SANW) 2025 Q2 法說會逐字稿

Good day and welcome to the S&W Seed Company's second quarter fiscal year 2025 financial results conference call.

大家好，歡迎參加 S&W Seed Company 2025 財年第二季財務業績電話會議。

(Operator Instructions)

（操作員指示）

Please note this event is being recorded. I would now like to turn the conference over to Robert Bloom with Lytham Partners. Please go ahead.

請注意，此事件正在被記錄。現在我想將會議交給 Lytham Partners 的 Robert Bloom。請繼續。

All right. Thank you very much, and thank you all for joining us today to discuss S&W Seed Company's second quarter fiscal year 2025 financial results for the period ended December 31, 2024. With us on the call representing the company today are Mark Herrmann, Chief Executive Officer; and Vanessa Baughman, the company's Chief Financial Officer. At the conclusion of today's prepared remarks, we will open the call for a question-and-answer session. (Event Instructions)

好的。非常感謝，也感謝大家今天加入我們，討論 S&W Seed Company 2025 財年第二季（截至 2024 年 12 月 31 日）的財務表現。今天與我們一起參加電話會議的公司代表是執行長 Mark Herrmann；以及公司財務長 Vanessa Baughman。在今天的準備好的演講結束後，我們將開始問答環節。（活動須知）

Before I begin with prepared remarks, please note that statements made by the management team of S&W Seed Company during the course of this conference call may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 as amended and Section 21E of the Securities Exchange Act of 1934 as amended, and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

在我開始準備好的發言之前，請注意，S&W Seed Company 管理團隊在本次電話會議中所作的陳述可能包含經修訂的 1933 年證券法第 27A 節和經修訂的 1934 年證券交易法第 21E 節所定義的前瞻性陳述，並且此類前瞻性陳述是根據 1995 年證券交易法的安全條款。

Forward-looking statements describe future expectations, plans, results or strategies and generally preceded by words such as may, future, plan or planned, will or should, expected, anticipate, draft, eventually or projected.

前瞻性陳述描述了未來的預期、計劃、結果或策略，通常以“可能”、“未來”、“計劃”或“計劃中”、“將要”或“應該”、“預期”、“預期”、“草案”、“最終”或“預期”等詞語開頭。

Listeners are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events or results could differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors and other risks identified in the company's 10-K for the fiscal year ended June 30, 2024, and other filings subsequently made by the company with the Securities and Exchange Commission.

請聽眾注意，此類聲明受多種風險和不確定因素的影響，這些風險和不確定因素可能導致未來的情況、事件或結果與前瞻性聲明中的預測存在重大差異，包括由於公司截至 2024 年 6 月 30 日的財政年度的 10-K 報告中確定的各種因素和其他風險以及公司隨後向美國證券交易委員會提交的其他文件中確定的實際因素和其他風險以及公司隨後向美國證券交易委員會提交的

To supplement S&W's financial results report in accordance with US generally accepted accounting principles, or GAAP, S&W will be discussing adjusted EBITDA and adjusted operating expenses on this call. These non-GAAP financial measures are not meant to be considered in isolation or as a substitute for the comparable GAAP measure and are not prepared under any comprehensive set of accounting rules or principles. An audio recording and webcast replay for today's conference call will also be available online on the company's Investor Relations page.

為了補充符合美國公認會計原則 (GAAP) 的 S&W 財務業績報告，S&W 將在本次電話會議上討論調整後的 EBITDA 和調整後的營運費用。這些非 GAAP 財務指標並非旨在單獨考慮或取代可比較的 GAAP 指標，並且並非根據任何全面的會計規則或原則編制。今天電話會議的錄音和網路直播重播也將在公司的投資者關係頁面上線上提供。

With that said, let me turn the call over to Mark Herrmann, Chief Executive Officer for S&W Seed Company. Mark, please proceed.

話雖如此，請允許我將電話轉給 S&W Seed Company 執行長 Mark Herrmann。馬克，請繼續。

Thank you, Robert, and good morning to all of you. I'm excited to be here today speaking with you all. To set the agenda for the call today, let me first touch on the actions we have taken over the past few quarters to reposition S&W focus on our high-value add crop opportunities where we can drive growth and profitability through leading crop innovation, mainly in Sorghum and Camelina and ultimately unlock value to shareholders.

謝謝你，羅伯特，大家早安。我很高興今天能在這裡與大家交談。為了確定今天電話會議的議程，首先讓我談談我們在過去幾個季度中採取的行動，重新定位 S&W 對高附加價值作物機會的關注，我們可以透過領先的作物創新來推動增長和盈利能力，主要是高粱和亞麻薺，並最終為股東釋放價值。

We will then look at long-term opportunity for sorghum as well as where the market stands today. I then will provide a brief update on our joint venture with VBO. Vanessa will then provide a detailed review of the financials, and we will take a look at any questions that you may have at the end.

然後，我們將研究高粱的長期機會以及當前的市場狀況。然後我將簡要介紹我們與 VBO 的合資企業的最新情況。然後，Vanessa 將對財務狀況進行詳細審查，最後我們將解答您可能遇到的任何問題。

For those somewhat new to S&W, let me just take a brief moment to remind everybody of the key activities that have taken place over the past few months or so that we believe will ultimately unlock value for S&W and its shareholders. First, we successfully completed the VA process in Australia, which occurred in late November 2024.

對於那些對 S&W 不太熟悉的人，請允許我花一點時間來提醒大家過去幾個月發生的關鍵活動，我們相信這些活動最終將為 S&W 及其股東釋放價值。首先，我們在2024年11月下旬成功完成了澳洲的VA流程。

Among other key conditions, the settlement agreement, which we finalized shortly after our last conference call in November, allowed for the release from the intercompany obligations owed to S&W Australia and agreement with the National Australia Bank that released S&W from the AUD15 million guarantee. In exchange, among other conditions, we transferred ownership of certain intellectual property and inventory to the new entity. Ultimately, this agreement provided the resources we mutually believe were needed to create going concerns for all entities.

除其他關鍵條件外，我們在 11 月上次電話會議後不久達成的和解協議允許解除對 S&W Australia 所欠的公司間債務，並與澳洲國民銀行達成協議，解除 S&W 的 1500 萬澳元擔保。作為交換，除其他條件外，我們將某些智慧財產權和庫存的所有權轉讓給新實體。最終，該協議提供了我們共同認為需要的資源，為所有實體創造持續經營。

Following the completion of the VA process, we successfully secured a new $25 million working capital facility with Mountain Ridge in late December 2024, which replaced the previous facility with CIBC Bank in connection with the agreement MFP, our largest shareholder, provided a letter of credit with a face amount equal to $13 million to be used as collateral. We believe the new facility and commitment could be viewed as a strong endorsement from both our largest shareholder and new strategic lending partner in the future of S&W and the opportunity it represents going forward.

在完成 VA 流程後，我們於 2024 年 12 月下旬成功從 Mountain Ridge 獲得了一筆新的 2500 萬美元營運資金貸款，該貸款取代了先前與加拿大帝國商業銀行 (CIBC Bank) 簽訂的貸款協議，該協議與我們最大的股東 MFP 提供的面值為 1300 萬美元的信用證作為抵押品有關。我們相信，新的融資和承諾可被視為我們最大股東和新策略貸款合作夥伴對 S&W 未來及其未來機會的強烈認可。

With these key activities as backdrop, we have operationally focused on aligning the cost structure of S&W while implementing best practices across the organization. The end results has been improved gross margins, a reduced breakeven rate, as well as lower working capital through an overall improvement in inventory management, all of which has put us closer to profitability without having raised equity capital during this past year.

以這些關鍵活動為背景，我們在營運上專注於調整 S&W 的成本結構，同時在整個組織內實施最佳實務。最終結果是透過庫存管理的全面改善提高了毛利率，降低了損益平衡率，並降低了營運資本，所有這些都使我們在過去一年中無需增加股本即可更接近盈利。

As a reminder, there are currently approximately 2.1 million shares of common stock outstanding and approximately 138,000 warrants, bringing the total diluted shares outstanding to approximately 2.2 million. Clearly, this has not been an easy task, threading the needle of the past year or so, and I want to personally thank the entire team here at S&W for their exceptional work.

提醒一下，目前流通在外的普通股約為 210 萬股，認股權證約為 138,000 份，使流通在外的稀釋股總數達到約 220 萬股。顯然，這不是一項容易的任務，在過去一年左右的時間裡，我要親自感謝 S&W 的整個團隊所做的出色工作。

With that as a backdrop, going forward, we are now exclusively focused on our core US-based operations, led by our high-value sorghum trade portfolio with Double Team as well as our biofuels partnership with Shell for Camelina. We are so excited about the new S&W. It's really driven by where we believe the market for sorghum is headed over the next decade. But more importantly, what our position in this market is.

在此背景下，展望未來，我們將專注於我們的核心美國業務，其中主要包括與 Double Team 進行的高價值高粱貿易組合，以及與殼牌在亞麻薺生物燃料方面的合作。我們對新的 S&W 感到非常興奮。這其實取決於我們對未來十年高粱市場走向的判斷。但更重要的是，我們在這個市場中的地位是什麼。

As some of you are aware, sorghum historically has not benefited from significant research investment broad acre crops such as corn, soybeans and cotton have received. S&W is working to change all of that. In the four years since we first commercialized -- commercially introduced Double Team, we have grown from no acres to approximately 10% to 12% market share of the US great sorghum makers this year.

你們中的一些人可能知道，從歷史上看，高粱並沒有像玉米、大豆和棉花等大面積作物那樣從大量的研究投資中受益。S&W 正在努力改變這一切。自從我們首次商業化——商業化推出 Double Team 以來的四年裡，我們的種植面積從零增長到今年佔據美國大高粱生產商約 10% 至 12% 的市場份額。

Based on expectation -- expected adoption rates, we believe Double Team sorghum can capture 25% to 30% of the US sorghum market share over the next eight years, which would generate about $70 million to $78 million in traded sorghum sales. This translates into a figure of about 16% to 18% through 2033.

根據預期——預期的採用率，我們相信 Double Team 高粱可以在未來八年內佔據美國高粱市場 25% 至 30% 的份額，這將產生約 7,000 萬至 7,800 萬美元的高粱交易銷售額。這意味著到 2033 年這一比例將達到約 16% 至 18%。

At this scale, we estimate that we would generate gross margins of approximately 76% to 81% on the traded products. Key to this growth is to build on our strength of our initial Double Team product with continuous innovation. We currently have multiple new products set to be launched over the next decade, including the commercial launch of our second-generation Double Team or DT2 Grain Sorghum and PAF or Prussic Acid Free Forage Sorghum in fiscal 2025 and DT2 Forage Sorghum in fiscal 2027 in the US.

以這一規模，我們估計交易產品的毛利率將達到約 76% 至 81%。實現這一成長的關鍵在於透過持續創新來鞏固我們最初的 Double Team 產品的優勢。目前，我們計劃在未來十年內推出多款新產品，包括在美國於 2025 財年推出第二代 Double Team 或 DT2 穀物高粱和 PAF 或無氫氰酸飼料高粱，以及於 2027 財年推出 DT2 飼料高粱。

The commercial launch of DT2 plus Prussic Acid Free Grain Sorghum in fiscal 2028 in the US. S&W will be extending our trade portfolio to targeted countries through our licensing strategy and agreements to leading independent seed companies as we receive regulatory labels and registrations.

DT2 加無氫氰酸高粱將於 2028 財政年度在美國進行商業上市。隨著我們獲得監管標籤和註冊，S&W 將透過我們的授權策略和與領先的獨立種子公司達成的協議，將我們的貿易組合擴展到目標國家。

The commercial launch of broad-spectrum herbicide tolerant sorghum in fiscal 2031 in the US and certain other countries in fiscal 2033, and finally, the commercial launch of insect tolerant sorghum in fiscal 2031 in the US and certain other countries in fiscal 2033.

廣譜抗除草劑高粱將於 2031 財年在美國和其他一些國家（2033 財年）進行商業化上市，最後，抗蟲高粱將於 2031 財年在美國和其他一些國家（2033 財年）進行商業化上市。

It's important to note that the pathway to these adoption rates is validated by adoption rates of similar technologies and other crops where leadership positions have been established and a multi-strategic go-to-market model has been enacted. This established road map we are following utilizes a combination of a robust direct technical sales team, private label licensing partners and distribution partners with some of the largest ag chem retail distributors in the US, along with an asset-light model in LatAm through collaborations with leading seed brands via licensing.

值得注意的是，這些採用率的途徑是透過類似技術和其他作物的採用率來驗證的，這些作物已經建立了領導地位，並制定了多戰略上市模式。我們所遵循的既定路線圖結合了強大的直接技術銷售團隊、自有品牌授權合作夥伴和分銷合作夥伴，其中包括美國一些最大的農業化學品零售分銷商，以及透過與領先的種子品牌透過許可合作在拉丁美洲採用輕資產模式。

In our view, there is not another company in the world that boast the sorghum capabilities that we have, providing a very strong first-to-market position with an impressive pipeline portfolio to continue to build on our market strength. So that's the long-term look as we see sorghum, consistent 16% to 18% decade-long CAGRs, high 70% plus gross margins driven by strong R&D pipeline and an established commercial model.

我們認為，世界上沒有其他公司擁有像我們這樣的高粱生產能力，我們憑藉著令人印象深刻的產品線組合，擁有非常強大的先發優勢，可以繼續增強我們的市場實力。因此，從長期來看，高粱的複合年增長率將保持在 16% 至 18% 之間，在強大的研發管道和成熟的商業模式的推動下，毛利率將達到 70% 以上。

Near term sorghum, we are focused on executing against our outlook that we have established for fiscal 2025, which includes global sorghum sales of about $24 million to $27 million, of which $12 million to $14.5 million of that is traded technologies. Looking at the numbers through the first 6 months certainly isn't indicative of our outlook that we have for the year.

在近期高粱方面，我們專注於執行我們為 2025 財年制定的展望，其中包括全球高粱銷售額約為 2,400 萬至 2,700 萬美元，其中 1,200 萬至 1,450 萬美元為交易技術。查看前六個月的數據肯定不能表明我們對今年的展望。

Last year, we saw a lot of early sales in -- during the December ending quarter, which was somewhat abnormal to the normal purchasing patterns, which tend to occur in the March through June time frame. Therefore, we certainly expect to see the normal significant ramp here to the coming months as we look to achieve our targets.

去年，我們在 12 月結束的季度中看到了大量早期銷售，這與正常的購買模式有些不正常，正常的購買模式往往發生在 3 月至 6 月的時間範圍內。因此，我們當然希望在未來幾個月內看到正常的大幅成長，以實現我們的目標。

Our confidence in the future of Double Team is being driven by the very high grower satisfaction results received from user market research with an extremely high percentage of growers reporting a positive experience. Overall, the majority of growers who have tried Double Team seek to increase acres. Simply put, farmers that have tried Double Team love it.

我們對 Double Team 的未來充滿信心，這是因為使用者市場調查顯示種植者滿意度非常高，其中極高比例的種植者報告了積極的體驗。總體而言，大多數嘗試過 Double Team 的種植者都希望增加種植面積。簡而言之，嘗試過 Double Team 的農民都喜歡它。

Now I'd like to be remiss if I don't exhibit some level of caution in the near term from a few of the macro factors that impact farmers' decisions, namely the potential impact from tariffs, as well as the rise in alternative crop prices as of recent. As most of you are aware, as a country, the US is a net exporter of sorghum, with the primary importer being China. Further alternative crop prices relative to sorghum could impact sorghum makers planted this coming season.

現在，如果我沒有在短期內對影響農民決策的一些宏觀因素表現出一定程度的謹慎，那就是我的失職，這些因素包括關稅的潛在影響以及最近替代作物價格的上漲。大多數人都知道，美國是高粱的淨出口國，主要進口國是中國。相對於高粱，其他作物價格的進一步上漲可能會影響下個季節種植的高粱。

As we have discussed in our private label business model is moving from selling in inventory to licensees fully loaded with production costs, germplasm royalty and trait royalty to selling with production costs and moving the germplasm and trait royalties to a grower point-of-sale invoice. This effectively keeps inventory management at the licensees while aligning the royalty payments with timing of sales to farmers. This model will enable our strategy to realize significant sales growth in market penetration and align revenue recognition with timing of grower sales. The model transition will be completed in 2027 planning season, with all but three licensees expected to be operating under this model in 2026.

正如我們在自有品牌業務模式中所討論的那樣，我們的模式是從向被許可人銷售庫存，向被許可人收取全部生產成本、種質使用費和性狀使用費，轉變為以生產成本銷售，並將種質和性狀使用費轉移到種植者的銷售點發票。這有效地將庫存管理保持在許可證持有者手中，同時使特許權使用費的支付與向農民銷售的時間保持一致。此模式將使我們的策略實現市場滲透的顯著銷售成長，並使收入確認與種植者銷售的時間保持一致。該模式的轉型將於 2027 年規劃季完成，預計除三家被授權人外，其餘所有被授權者都將在 2026 年採用該模式運作。

As you know, with the US seed business, our third and fourth quarters, which run from January through June, are our key quarters, and we are in full court press mode to ensure that our sales and logistics teams are in sync to get product to customers in a timely manner. In fact, we just completed a multi-day strategic sales meeting with high levels of enthusiasm from the organization. Clearly, the next few months will be busy for our teams, and I'm confident that we are well positioned as we can be to execute on the plans that we have put in place.

如您所知，對於美國種子業務來說，第三季度和第四季度（從 1 月到 6 月）是我們的關鍵季度，我們全速前進，以確保我們的銷售和物流團隊同步，及時將產品送到客戶手中。事實上，我們剛結束了為期多天的策略銷售會議，整個組織都展現了高度的熱情。顯然，接下來的幾個月對我們的團隊來說將會非常忙碌，但我相信我們已做好充分準備來執行我們所製定的計劃。

Let's transition for a moment to VBO. While there's not a lot of new information to report, everything related to our biofuels joint venture with Shell remains on track. As a reminder, we own a 34% interest in the JV. A quick reminder of this past fall, VBO introduced Camelina seed to farmers which carries resistance to [ glufosinate ], an effective broad-spectrum over-the-top wheat control system. There are currently promotions ongoing with them directly working with farmers into the spring months. I hope to be able to share more with you in the upcoming call.

讓我們暫時轉到 VBO。雖然沒有太多新資訊可供報告，但與我們與殼牌的生物燃料合資企業相關的一切工作仍在按計劃進行。提醒一下，我們擁有合資企業 34% 的權益。回顧去年秋天，VBO 向農民推出了一種對 [ 草銨膦 ] 具有抗性的亞麻薺種子，草銨膦是一種有效的廣譜小麥控制系統。他們目前正在進行促銷活動，直接與農民合作，持續到春季。我希望能夠在即將到來的電話會議中與大家分享更多內容。

Before I turn it to Vanessa, let me just briefly comment on the announcement we made in mid-January regarding the commencement by the Board to explore and evaluate various strategic alternatives that may be available to S&W in an effort to enhance shareholder value. As you can imagine, there is not a lot I can share with you besides what the Chairman, Alan Willits, mentioned in the press release, which is that we believe we have taken decisive actions to strengthen the company, much of which I have discussed today, and that the Board supports all initiatives that optimize shareholder value, and we'll consider the full range of potential strategic alternatives to ensure S&W Seed is best positioned for future success.

在將主題轉到 Vanessa 之前，請允許我簡要評論我們在 1 月中旬宣布的消息，該消息涉及董事會開始探索和評估 S&W 可能採用的各種戰略替代方案，以提高股東價值。你可以想像，除了董事長艾倫·威利茨在新聞稿中提到的內容之外，我能與你分享的信息並不多，那就是我們相信我們已經採取了果斷行動來加強公司，其中大部分內容我今天已經討論過了，董事會支持所有優化股東價值的舉措，我們將考慮所有潛在的戰略替代方案，以確保 S&W Seed 為未來的成功做好最佳準備。

As always, there can be no assurance that the review process will result in the company pursuing any transactions or any other strategic outcome, nor as to the form or timing of any of the foregoing. The Board has not set a timetable for completion of this process, and we do not intend to disclose further developments unless and until it determines that further disclosure is appropriate or necessary. Let me turn the call over to Vanessa for a full detailed review of the financials, including our outlook and guidance for the upcoming year. I will then provide some brief closing comments and turn it over for any questions you may have. Vanessa?

像往常一樣，我們無法保證審查過程將導致公司進行任何交易或任何其他策略成果，也無法保證上述任何交易的形式或時間。董事會尚未設定完成此過程的時間表，我們也不打算披露進一步的發展，除非董事會確定進一步披露是適當或必要的。讓我將電話轉給 Vanessa，讓她全面詳細地檢視財務狀況，包括我們對來年的展望和指導。然後，我將提供一些簡短的結束語，並回答你們可能提出的任何問題。瓦妮莎？

Thanks, Mark. Good morning to everyone on the call today. Before I begin, let me just remind everyone that the completion of the divestiture of the Australian subsidiary has resulted in moving all Australian-related operations to discontinued operations on a look-back basis for FY '24. Therefore, when you look at the period-over-period comparisons, the Australian domestic and the Australian international businesses have been moved to discontinued operations for both of the financial years.

謝謝，馬克。今天電話會議中的各位早安。在我開始之前，請容許我提醒大家，澳洲子公司的剝離完成已導致所有與澳洲相關的業務在 24 財年轉為回顧性停止營運。因此，當您查看同期比較時，您會發現兩個財政年度的澳洲國內業務和澳洲國際業務都已轉為停止營運。

With that, let's dive right in. On the revenue line for Q2 only, we reported revenue of $5.1 million compared to $8.3 million in Q2 of last year. Again, the $8.3 million from last year excludes Australia. A couple of keynotes on revenue. Last year's Q2 had $1.1 million of ex-US international revenue, which was not repeated this quarter. No sales ex-US international occurred in Q2 of this year as we continue to evaluate our crop strategy moving forward for the remainder of fiscal year 2025. The remaining delta is primarily on Double Team, which had Q2 revenue this year of $1.9 million versus $4 million in Q2 of last year. The difference here is the timing of private label shipping.

有了這些，我們就可以開始吧。僅在第二季的收入方面，我們報告的收入為 510 萬美元，而去年第二季的收入為 830 萬美元。再次強調，去年的 830 萬美元不包括澳洲。關於收入的幾個主題演講。去年第二季美國以外的國際收入為 110 萬美元，而本季則沒有出現這種情況。由於我們將繼續評估 2025 財年剩餘時間的作物策略，因此今年第二季沒有發生美國以外的國際銷售。剩餘的差異主要體現在《Double Team》上，該公司今年第二季的營收為 190 萬美元，而去年第二季的營收為 400 萬美元。這裡的差別在於自有品牌運送的時間。

Overall, Americas sorghum revenue, including Double Team and conventional sorghum, was $3.1 million. Americas forage revenue was $1.7 million, and there was a small amount of other pertaining to our VBO partnership. As I mentioned last quarter, Q1 and Q2 are seasonally our lightest quarters, with Q3 and Q4, which is our March and June ending quarters, being the bulk of our volumes where we expect about 65% to 70% of our annualized sales to occur. Q3 and Q4 will also be the quarters in which the greatest leverage in our business occurs to the bottom line, as many of the fixed costs are absorbed over greater revenue dollars. In fact, our guidance suggests that we will have positive adjusted EBITDA of $1 million to $3 million in the second half of fiscal 2025.

總體而言，美洲高粱的收入（包括 Double Team 和傳統高粱）為 310 萬美元。美洲飼料收入為 170 萬美元，還有少量其他收入與我們的 VBO 合作夥伴關係有關。正如我上個季度提到的，第一季和第二季是我們季節性最淡的季度，而第三季和第四季（三月和六月結束的季度）是我們銷售的主要部分，我們預計這部分銷量將佔年化銷售量的 65% 至 70% 左右。第三季和第四季也將是我們業務中對底線影響最大的季度，因為許多固定成本都被更大的收入所吸收。事實上，我們的預期是，2025 財年下半年我們的調整後 EBITDA 將達到 100 萬至 300 萬美元。

For fiscal 2025, which ends on June 30, 2025, our guidance remains unchanged from last quarter, with total revenue to be between $34.5 million and $38 million for the ongoing business. This number does include the $4.1 million of international sales recognized in Q1.

截至 2025 年 6 月 30 日的 2025 財年，我們的預期與上一季保持不變，持續經營業務的總收入將在 3,450 萬美元至 3,800 萬美元之間。這個數字確實包括第一季確認的 410 萬美元的國際銷售額。

Let's break the guidance for the ongoing business down a bit more. We expect total global sorghum revenue to be $24 million to $27.5 million, of which DT will be between $12 million and $14.5 million and the pilot for Prussic Free will contribute $200,000 in revenue. The remainder will be our conventional trades in sorghum. This includes sorghum sales that we recorded in Q1 and expect to record in the international reporting segment in Q3 and Q4. International forage sales are expected -- are approximately $3.2 million, of which the full $3.2 million was recognized in Q1. And Americas forage will be between $7 million and $8 million, while other sales will be approximately $300,000.

讓我們進一步細分一下正在進行的業務的指導。我們預計全球高粱總收入將達到 2,400 萬美元至 2,750 萬美元，其中 DT 將在 1,200 萬美元至 1,450 萬美元之間，而 Prussic Free 試點將貢獻 20 萬美元的收入。其餘部分將是我們傳統的高粱貿易。這包括我們在第一季記錄的高粱銷售額，預計將在第三季和第四季的國際報告部門記錄。預計國際飼料銷售額約 320 萬美元，其中第一季已全部實現 320 萬美元。美洲的飼料銷售額將在 700 萬至 800 萬美元之間，而其他銷售額約為 30 萬美元。

Now turning to margins. Gross profit margin for Q2 was 37.1% compared to 42.8% in last year's Q2. Again, last year's gross margin excludes Australian operations. The change here is really due to the lower DT revenue in Q2 of this year versus Q2 of last year. We are expecting total gross margins for fiscal 2025 to be between 33% and 36%.

現在轉向利潤。第二季毛利率為 37.1%，去年第二季為 42.8%。再一次，去年的毛利率不包括澳洲業務。這裡的變化實際上是由於今年第二季的 DT 收入與去年第二季相比有所下降。我們預計 2025 財年的總毛利率將在 33% 至 36% 之間。

Now let's transition to operating expenses. Q2 fiscal 2025 operating expenses, inclusive of depreciation and amortization for the ongoing business in total, were $6.2 million compared to $5.7 million last year. The Q2 fiscal 2025 number also includes all of the nonrecurring transactional costs pertaining to voluntary administration of approximately $600,000. Excluding depreciation and amortization as well as the nonrecurring transaction costs, adjusted operating expenses during Q2 were $4.9 million, which is flat with last year at $4.9 million in Q2.

現在讓我們轉到營運費用。2025 財年第二季的營運費用（包括持續經營業務的折舊和攤提）總計為 620 萬美元，而去年為 570 萬美元。2025 財年第二季的數據還包括與自願管理有關的所有非經常性交易成本，約 60 萬美元。不包括折舊和攤銷以及非經常性交易成本，第二季的調整後營運費用為 490 萬美元，與去年第二季的 490 萬美元持平。

Looking at it on an annualized basis, our expectation is for total operating expenses exclusive of depreciation and amortization, stock-based comp and any one-time charges related to VA to be about $16.5 million. Including depreciation and amortization and stock-based comp, that number will be about $21.1 million. We have made a number of significant reductions in operating expenses through last fiscal year and leading up to Q1 of this year, and believe we have reached a very reasonable go-forward operating expense structure.

從年度化角度來看，我們預計不包括折舊和攤提、股票補償以及與 VA 相關的任何一次性費用的總營運費用約為 1,650 萬美元。包括折舊、攤提和股票補償，這個數字將達到約 2,110 萬美元。我們在上個財年以及今年第一季之前大幅削減了營運費用，並相信我們已經達到了非常合理的未來營運費用結構。

As I mentioned last quarter, we carry about $3 million of costs related to being a publicly traded company. But beyond that, we have made significant efforts to align our go-forward business plan with our expenses to try and drive the business towards profitability.

正如我在上個季度提到的，作為一家上市公司，我們的成本約為 300 萬美元。但除此之外，我們還做出了巨大努力，使我們的未來業務計劃與我們的支出保持一致，以努力推動業務實現盈利。

Now to EBITDA. Adjusted EBITDA for Q2 was a negative $2.9 million compared to adjusted EBITDA of negative $1.1 million in last year's Q2. For the first half of fiscal 2025, adjusted EBITDA is a negative $6 million. Based on the various inputs I provided, we are expecting adjusted EBITDA for the year to be between a negative $5 million on the low end to a negative $3 million on the high end compared to negative $5.6 million with Australia's businesses removed in fiscal year 2024.

現在談談 EBITDA。第二季調整後 EBITDA 為負 290 萬美元，而去年第二季調整後 EBITDA 為負 110 萬美元。2025 財年上半年，調整後的 EBITDA 為負 600 萬美元。根據我提供的各種信息，我們預計今年的調整後 EBITDA 將在負 500 萬美元至負 300 萬美元之間，而如果在 2024 財年剔除澳大利亞業務，則調整後 EBITDA 將為負 560 萬美元。

Put differently, with the first half already at negative $6 million, we are expecting the high end of our range for the rest of the year to be a positive $3 million for the back half of the year and for the low end to be about $1 million in positive adjusted EBITDA breakeven for the rest of fiscal 2025 in aggregate.

換句話說，由於上半年已經出現負 600 萬美元，我們預計今年剩餘時間的預期上限為下半年的正 300 萬美元，下限為 2025 財年剩餘時間總計約 100 萬美元的正調整後 EBITDA 盈虧平衡點。

As Mark mentioned, since our last call, we successfully secured a $25 million working capital facility with Mountain Ridge, which replaced the previous facility we had with CIBC. I want to take a moment to thank CIBC for their support of S&W over the past four years, and we're excited to be working with the team at Mountain Ridge moving forward. Their commitment, coupled with the $13 million letter of credit provided by MFP, are tremendous endorsements to the work done over the last year to reposition S&W going forward. Again, I'm happy to follow-up with any of the details we went through if you should have additional questions. With that, let me turn the call back over to Mark.

正如馬克所提到的，自上次通話以來，我們成功地從 Mountain Ridge 獲得了 2500 萬美元的營運資金，取代了我們之前從 CIBC 獲得的資金。我想花點時間感謝加拿大帝國商業銀行 (CIBC) 在過去四年中對 S&W 的支持，我們很高興能與 Mountain Ridge 團隊繼續合作。他們的承諾，加上 MFP 提供的 1300 萬美元信用證，是對過去一年為重新定位 S&W 未來所做的工作的巨大認可。再次，如果您還有其他問題，我很樂意跟進我們討論過的任何細節。說完這些，讓我把電話轉回給馬克。

Thank you, Vanessa. First, let me just thank the entire team at S&W for their hard work over the past year to get S&W to a place where we can focus on delivering value to farmers and shareholders alike. Going forward, our business is going to be driven by high value, high-margin sorghum trait technology in well-established markets in the Americas.

謝謝你，凡妮莎。首先，我要感謝 S&W 全體團隊在過去一年中的辛勤工作，使 S&W 能夠專注於為農民和股東創造價值。展望未來，我們的業務將由美洲成熟市場的高價值、高利潤的高粱性狀技術所驅動。

Our commercialization strategy is robust and validated by decades of success by similar products in adjacent crops. Our product development pipeline is deep, with multiple new products set to launch each year in various geographies over the next decade. Importantly, the value we bring to farmers has been validated. The farm gate value of our Double Team grain product is between $36 to $72 per acre. Our DT forage products provide between $30 to $67 per acre. Our Prussic Acid Free Trait adds an additional $30 to $55 per acre. When you look -- when you stack them, it allows farmers to take full advantage of each independent trait value. These are significant benefits to farmers, as they protect against hundreds of millions of dollars of estimated farm production loss each year.

我們的商業化策略是穩健的，並且已透過數十年來在鄰近作物中推廣類似產品的成功經驗得到驗證。我們的產品開發管道非常豐富，未來十年每年都會在不同地區推出多款新產品。重要的是，我們為農民帶來的價值已經得到驗證。我們的 Double Team 穀物產品的農場門口價值在每英畝 36 美元至 72 美元之間。我們的 DT 飼料產品每英畝售價在 30 至 67 美元之間。我們的無氫氰酸特性每英畝可額外增加 30 至 55 美元。當你觀察——當你將它們堆疊起來時，它可以讓農民充分利用每個獨立特徵的價值。這些對農民來說是巨大的利益，因為他們可以避免每年數億美元的農業生產損失。

And of course, we have large equity stake in Shell biofuels JV, which has a large opportunity ahead of ourselves as we progress in our second year of the JV. With the business dramatically more streamlined from an OpEx perspective and efficiencies in place to drive incremental gross margin improvements in both our traded products as well as our other forage products, I believe we are in a position to return S&W to profitability. I want to sincerely thank all the shareholders for their continued support. With that said, I look forward to taking your questions. Operator?

當然，我們在殼牌生質燃料合資企業中擁有大量股權，隨著合資企業第二年的進展，我們面臨著巨大的機會。從營運支出角度來看，業務得到了顯著精簡，效率得到提高，從而推動了我們的貿易產品和其他飼料產品的毛利率不斷提高，我相信我們有能力讓 S&W 恢復盈利。我要真誠感謝全體股東的持續支持。話雖如此，我期待回答您的問題。操作員？

(Operator Instructions)

（操作員指示）

Ben Cleeve, Lake Street Capital Markets.

本‧克利夫 (Ben Cleeve)，Lake Street Capital Markets。

Alright, thanks for taking my questions. I got a handful of them here. First, a couple regarding the current year, results. So first question on, the pertain to DT sorghum, I'm curious, what you see as the level of inventory for that. Product that's already within the supply chain, is that, our inventory level still such, that there, there's, real visibility of a pretty steep commercial ramp, or do you have any concern about elevated levels here at this point in the year?

好的，感謝您回答我的問題。我這裡有很多。首先，關於今年的幾個結果。所以第一個問題是關於 DT 高粱的，我很好奇，您認為它的庫存水準是多少。已經在供應鏈中的產品，我們的庫存水準是否仍然如此，是否真的可以看到相當陡峭的商業坡度，或者您是否擔心今年這個時候庫存水準會升高？

Ben, I appreciate the question. As we look at our business, over 50% of our business comes from Sorghum Partners brand, which S&W completely operates in the US, right? So with Sorghum Partners brand all unsold inventory at the end of the spring gets picked up and returned to our warehouse. So in reality, we know exactly that we start annually from 0, right? So there's no pre-existing supply in the channel, and we're moving forward with that business and expect to see the growth that we had built into the plan.

本，我很感謝你的提問。從我們的業務來看，超過 50% 的業務來自 Sorghum Partners 品牌，該品牌完全由 S&W 在美國經營，對嗎？因此，Sorghum Partners 品牌在春季末期所有未售出的庫存都會被收集並送回我們的倉庫。所以實際上，我們確切地知道我們每年都是從 0 開始，對嗎？因此，通路中沒有預先存在的供應，我們正在推進該業務，並期望看到我們在計劃中建立的成長。

With the license business, they do the same activity with their own seed brands in the fact that they deliver and then they pull back into company warehouses and have an accurate count at the end of the year. So our previous model was shipping fully loaded trait in germplasm royalty as well as the cost of goods shipping to the licensed companies. And as I talked about in this call, that will be moving to more of a system of where the licensed company takes inventory at a cost of goods, just like every seed company, including ourselves, does and manages their internal inventory, and then we'll pay royalties based on grower actual sales each year reported by our year-end, right? So it will move to it.

透過許可業務，他們對自己的種子品牌進行同樣的活動，即他們交付種子，然後將其拉回公司倉庫，並在年底進行準確的數量統計。因此，我們先前的模式是將種質資源特許權使用費中滿載的特性以及貨物運送到獲得許可的公司的成本一起運送。正如我在這次電話會議中談到的那樣，這將轉向一種更完善的系統，即獲得許可的公司按商品成本進行庫存盤點，就像包括我們在內的每家種子公司一樣，管理其內部庫存，然後我們將根據種植者每年在年底報告的實際銷售額支付特許權使用費，對嗎？所以它會移動到那裡。

So there's a bit of gap and information as to timing when each of the licensees pull in inventory. And last year, we did see a incremental amount of ordering in the fourth quarter, pulling inventory into their businesses, both to fill spring needs as well as to carry some inventory into the next year. I think potentially, it, along with some of just the indecision on farms, some of the things we're seeing geopolitically of question marks are moving, there'd be a question mark if our process going through the VA last year slowed some people down as far as bringing in their inventory in Q1 and Q2 versus bringing it in now in Q3 and Q4, right? So we're working to analyze that and be on top of it as we work through with licensees right now.

因此，每個被授權者提取庫存的時間存在一些差距和資訊。去年，我們確實看到第四季度的訂單量增加，將庫存拉入他們的業務，既是為了滿足春季需求，也是為了將一些庫存帶入明年。我認為，潛在的原因是，除了農場方面的一些猶豫不決之外，我們在地緣政治上看到的一些問號也在發生變化，如果我們去年通過 VA 的過程減慢了一些人在第一季度和第二季度引入庫存的速度，而不是現在在第三季度和第四季度引入庫存，那麼就會有一個問號，對嗎？因此，我們正在努力分析這一點，並在與許可證持有者合作的過程中掌握它。

For what their production plans, one, what their demand, their sales, what inventory they need to ensure they can complete demand with their customers for this year for shipping, as well as then working up their production plan for next year's planned sales, and we'll have that effort over the next couple of weeks. So I think one of the pieces that delayed the one and two was our process of going through the Australian VA and some of the unknowns that put into the marketplace, as well as we are in kind of a unique situation on farm with farmer decision-making on cropping plans. There's been a huge amount of commodity price volatility on all crops between corn, soybean and cotton as far as the alternative crops as well as sorghum. But I do believe we'll see that settling out and farmers to be finalizing their decision as we move forward.

首先，他們的生產計劃是什麼，他們的需求是什麼，他們的銷售情況是什麼，他們需要什麼庫存來確保他們能夠滿足客戶今年的運輸需求，然後製定明年計劃銷售的生產計劃，我們將在接下來的幾週內完成這項工作。因此，我認為導致第一和第二個項目推遲的因素之一是我們經歷澳大利亞退伍軍人事務部的過程以及一些進入市場的未知因素，以及我們在農場中處於一種獨特的情況，即農民對種植計劃進行決策。玉米、大豆、棉花以及替代作物和高粱等所有作物的商品價格都出現了巨大的波動。但我相信，隨著我們不斷前進，我們會看到這個問題得到解決，農民也會最終做出決定。

I don't anticipate that it's a significant problematic piece. But I do believe the model we're going to is a model that will help us have seed companies planning to carry the appropriate level of inventories on a year-round basis to really run their seed business efficiently versus trying to avoid bringing material in because of the fully loaded cost, which included germplasm royalty and trade royalty before they had the sales activity taking place with farmers.

我不認為這是一個有重大問題的作品。但我確實相信，我們將要採用的模式將幫助我們的種子公司計劃全年保持適當的庫存水平，從而真正有效地運營他們的種子業務，而不是因為滿載成本而試圖避免引進材料，其中包括在與農民進行銷售活動之前的種質使用費和貿易使用費。

Ben, is that -- does that kind of address it? I know it still leaves a huge unknown. But I don't see a signal that says that we're off track versus the guidance that Vanessa and I have rolled out to the organization.

本，這樣可以解決這個問題嗎？我知道這仍留下巨大的未知數。但我沒有看到任何跡象表明我們偏離了瓦妮莎和我向組織提出的指導方針。

Yes. That's -- I appreciate that there's a lot of moving pieces here. So I certainly appreciate the uncertainty, but that was all very helpful context. And you got to my -- you alluded to my next question, which I don't know if this is better directed to you or Vanessa, but regarding the current year guidance and the sorghum revenue that you lay out, I'm curious given the rising price of alternative commodities, especially corn, the level of embedded acreage you guys are expecting within the US market. The level of acreage within the US market that you're expecting embedded within your guidance, do you guys anticipate kind of a flat level of sorghum acreage year-over-year in the country? Or are you expecting some kind of decline given elevated pricing here for alternative crops?

是的。那是——我很欣賞這裡有很多動人的部分。所以我當然理解這種不確定性，但這一切都是非常有幫助的背景。你回答了我的問題——你提到了我的下一個問題，我不知道這個問題是直接問你還是問 Vanessa 比較好，但關於今年的指導和你列出的高粱收入，鑑於替代商品價格上漲，特別是玉米，我很好奇你們預計美國市場上的種植面積會有多少。您預期美國市場的種植面積水準將與去年同期持平嗎？或者您是否預計，由於替代作物價格上漲，產量會出現某種下降？

Yes, it's a great question. And I'll take a first swing at it, and then Vanessa, please, if you've got others to add. But if you look at the acre trend, sorghum had been on a bit of a growth trend if you look over the 2 years prior to last year, right, sort of growing from 6 million to about a 7.2 million, 7.3 million acre crop for the planting season of '23, which also had the contribution of very late planning, the weather through a lot of the sorghum market was wet, which prevented planting of cotton and alternative crops. Farmers came back with the sorghum crop, which helped also move acreage up.

是的，這是一個很好的問題。我將首先嘗試一下，然後請 Vanessa 補充其他內容。但如果你看一下種植面積趨勢，你會發現在去年之前的兩年裡，高粱的種植面積一直呈增長趨勢，從 600 萬英畝增長到 2023 年種植季的 720 萬到 730 萬英畝，這也是由於計劃非常晚，高粱市場大部分地區天氣潮濕，阻礙了棉花和替代作物的種植。農民重新開始種植高粱，這也有助於增加種植面積。

Last year was the opposite impact. It was a perfect spring. Commodity prices were strong and the other commodity pieces and we saw acres move back down from 7.2 million into the 6.3 million to 6.5 million sorghum acres. We did not build our plan based on depending on growth of sorghum acres. But as we look at the market, it does have a pretty significant swing based on what acre planning does happen, right? So we started out very strong, the economics of planning sorghum versus alternative crops was very positive. It's leveled off a little bit with the increase in the corn price, which -- if you look at corn price seasonally, the corn market is very good at raising the price, working to get the acres planted, which I anticipate is what's taking place this year as well. But we really didn't build our plan based on a return to a 7-plus million acre base.

去年的影響則相反。這是一個完美的春天。大宗商品價格堅挺，其他大宗商品價格也表現強勁，我們看到高粱種植面積從 720 萬英畝回落至 630 萬至 650 萬英畝。我們的計劃並不是根據高粱種植面積的增長來制定的。但當我們觀察市場時，它會根據土地規劃的實施而發生相當大的波動，對嗎？因此，我們的開局非常強勁，規劃高粱與替代作物的經濟效益非常可觀。隨著玉米價格的上漲，這一趨勢略有趨於平穩，如果你從季節性角度看玉米價格，你會發現玉米市場非常擅長提高價格，並努力增加種植面積，我預計今年也會發生這種情況。但我們的計劃確實不是以回歸 700 多萬英畝的土地為基礎制定的。

Okay. Good to hear the conservatism embedded within that, then. Vanessa, a question for you on the debt levels and update on the new credit facility. So first of all, I think I see the -- between getting the Australian business exited and then ripping working capital off the balance sheet, you guys are sitting at a level of debt that's lower than it's been since like 2016.

好的。很高興聽到其中蘊含的保守主義。瓦妮莎，我想問您一個關於債務水平和新信貸安排更新的問題。首先，我認為我看到了——在退出澳洲業務和從資產負債表中提取營運資金之間，你們的債務水平比 2016 年以來的水平要低。

So congratulations on some real progress on that front. And my question to you is twofold here. The degree of visibility you have at further reductions in working capital here over the second half of this year or maybe over the next 12 months? And then also the level of availability you have today within your new credit facility?

因此，祝賀您在這方面取得了一些真正的進展。我要向您提兩個問題。您認為今年下半年或未來 12 個月營運資本進一步減少的程度如何？那麼，目前您的新信用額度的可用性水準如何？

Yes, of course. Thank you, Ben, for the question. So for the remainder of fiscal 2025 -- we -- and I'll mention this in comparison to last year. We will end -- or it's anticipated that we will end fiscal year 2025 at a lower debt position than last year. And it goes to exactly what you just mentioned.

是的當然。謝謝本的提問。因此，對於 2025 財年的剩餘時間 — — 我們 — — 我會提到這一點並與去年進行比較。我們將結束——或預計我們將以比去年更低的債務狀況結束 2025 財年。這和你剛才提到的完全一致。

So continued focus on OpEx and meeting our targets on OpEx as well as the working capital component. While we were able to achieve that through Q2 in terms of lower debt versus last year, one of the things from a cash flow perspective that we "had to cover for" are those onetime transactional costs that you can see in our adjusted EBITDA reconciliation within the financials of approximately $600,000 related to VA.

因此，我們將繼續關注營運支出並實現營運支出和營運資本部分的目標。雖然我們能夠透過第二季實現這一目標，即債務比去年同期減少，但從現金流角度來看，我們「必須彌補」的一件事是那些一次性交易成本，您可以在我們調整後的 EBITDA 對帳中看到，財務報表中與 VA 相關的交易成本約為 60 萬美元。

So unfortunately, that was a cash outlay that we had not planned, right, at the time that we were working through the particulars with Mountain Ridge. But for the remainder of fiscal 2025, we're in a position from a capacity perspective to be well supported with the Mountain Ridge facility as it is today. And as a reminder, it is an asset-based type of agreement. So as sales start to position themselves over Q3 and Q4, that gives us adequate credit financing for the remainder of 2025. That again, is expected year-over-year that we will be in a lower debt position and overcoming those onetime costs. But I will say that added some complexity to at least Q1 and Q2 and overcoming that $600,000 in those onetime nonrecurring costs related to VA.

所以不幸的是，這是一筆我們在與 Mountain Ridge 商討具體細節時沒有計劃的現金支出。但對於 2025 財年的剩餘時間來說，從產能角度來看，我們能夠像現在一樣透過 Mountain Ridge 工廠獲得良好的支援。需要提醒的是，這是一種基於資產的協議。因此，隨著銷售在第三季和第四季開始定位，這將為我們在 2025 年剩餘時間內提供充足的信貸融資。再次，預計我們的債務狀況將逐年降低，並能克服那些一次性成本。但我要說的是，這至少為第一季和第二季增加了一些複雜性，並克服了與 VA 相關的 60 萬美元的一次性非經常性成本。

Vanessa, Could I just add? So as Vanessa and I came in, we did feel S&W was carrying far too much inventory for sales. So as we finish this year, we should reduce carryout inventories by about 40% to 50% versus what we carried out last year, which has a huge positive as far as cash tied up in inventory, but also most seed inventory, you lose approximately 10% due to quality just aging. So it's a significant reduction in it.

瓦妮莎，我可以補充一下嗎？因此，當我和 Vanessa 加入時，我們確實感覺到 S&W 的庫存太多，難以銷售。因此，到今年年底，我們應該將庫存減少約 40% 至 50%，與去年相比，這對於庫存中的現金有很大的好處，但對於大多數種子庫存來說，由於品質老化，損失了約 10%。因此，這是一個顯著的減少。

And I say this because I really don't even believe it's totally focused on just reducing working capital, but it puts the company in a very quick to move. When you've got a strong pipeline of new product advancements that we're going to have over the next 10 years, the ability to keep inventories tight to have the ability to ramp up the newest technology, the newest germplasm as quickly as possible, continues to drive the leadership position. So it will have very positive impacts on both the working capital as well as profitability, but also, it will put us in a place to continue to support a very aggressive ramp-up of sales success as well.

我之所以這麼說，是因為我真的不相信它完全專注於減少營運資金，但它卻讓公司迅速採取行動。當我們擁有未來 10 年內將要推出的一系列強大的新產品時，保持庫存緊張的能力，能夠盡快推出最新技術、最新種質，將繼續推動我們的領導地位。因此，它將對營運資金和獲利能力產生非常積極的影響，而且，它也將使我們能夠繼續支持銷售成功的積極成長。

Okay. Very good. One more for me and then I'll get back in queue. And it's just kind of a big picture question. In the context of the strategic review, you laid out all of these kind of long-term expectations. And I'm curious, the degree to which the scale of S&W constrains the ramp in sorghum either from an R&D perspective or a commercial perspective? And any potential synergy that could come from a larger operation having this kind of business embedded within it? I mean, is there a material constraint from a financial or human capital perspective at S&W on the sorghum outlook that you think could be kind of unlocked if this was elsewhere?

好的。非常好。我再說一遍，然後我就回到隊列。這只是一個宏觀問題。在策略評估的背景下，您列出了所有這些長期期望。我很好奇，從研發角度或商業角度來看，S&W 的規模在多大程度上限制了高粱產量的成長？那麼，如果將此類業務納入更大規模的營運中，是否會產生潛在的協同效應？我的意思是，從財務或人力資本的角度來看，S&W 對高粱前景是否有物質限制，如果這種情況發生在其他地方，您認為這種限制可以解決嗎？

That's a great point and input, Ben. So there's always a strategic opportunity for entities to be able to look internally at the resources they're already spending and how does it either significantly contribute to or accelerate a trait pipeline or product release pipeline that we've got really in sight for the next 10 years. So I do think as we go through the process, there will be significant opportunities for different organizations to assess how the resources and assets inside of S&W really contribute and escalate their current paths, right, either S&W's ability to reach and accelerate or their ability to -- for efficiencies and investment in other places. So I do believe that there'll be significant value identified.

這是一個很好的觀點和意見，本。因此，對於實體來說，始終存在一個策略機會，能夠從內部審視他們已經花費的資源，以及它如何顯著地促進或加速我們在未來 10 年內真正看到的性狀管道或產品發布管道。因此，我確實認為，隨著我們推進這一進程，不同的組織將有很大機會評估 S&W 內部的資源和資產如何真正促進和升級他們當前的道路，對吧，無論是 S&W 達到和加速的能力，還是他們在其他地方提高效率和投資的能力。因此我確實相信將會發現重大價值。

Very good. All right. Well, I appreciate you taking my questions. Congratulations. It's been a busy and very productive last few months. Good luck on second half of this year, and I'll get back in queue.

非常好。好的。好吧，感謝您回答我的問題。恭喜。過去的幾個月非常忙碌且富有成效。祝今年下半年好運，我會重新排隊。

Kurt Caramanidis, Carl M. Hennig Inc.

Kurt Caramanidis，Carl M. Hennig 公司

Hi, thanks for taking my question.

你好，謝謝你回答我的問題。

Questions on VBO. Are there constraints in selling that position as you do this review from Shell? Or any kind of color that you could give us on how that would be monetized potentially? And then is next year kind of a ramp year for the Camelina business?

關於 VBO 的問題。當您從殼牌公司進行審查時，出售該職位是否有限制？或者您能否向我們詳細說明如何將其貨幣化？那麼明年對於亞麻薺業務來說是否是成長年？

I'll cover the last one first. So as VBO keeps expanding their product lines, particularly focused on their trait position, which is very unique in the marketplace for Camelina for easy control of weeds at a very economical position. I do believe their continued ramp-up of success positioning with farmers will move forward.

我先講最後一個。因此，VBO 不斷擴大其產品線，尤其註重其特性地位，這在亞麻薺市場上非常獨特，能夠以非常經濟的方式輕鬆控制雜草。我確實相信他們將繼續加強與農民的成功定位。

As far as the other one, I probably have to say I can't really speak to the specifics with it other than what was positioned by the Chairman of the Board, Alan Willits. Alan Willits and Mark Wong are also on the Board of VBO, and as we look at it, we're looking at all opportunities that bring value to S&W shareholders as we move forward.

至於另一個問題，我可能不得不說，除了董事會主席艾倫威利茨 (Alan Willits) 所提出的觀點之外，我無法真正談論具體細節。Alan Willits 和 Mark Wong 也是 VBO 董事會成員，我們正在尋找所有能為 S&W 股東帶來價值的機會。

Okay. Fair enough. And then did you -- I know you did the reverse split, but have you considered going to the OTC to save a couple? I know that wouldn't be free, but a couple of million bucks a year, what's kind of the thought process there?

好的。很公平。然後你——我知道你做了反向拆分，但你有沒有考慮過去 OTC 挽救一些？我知道這不是免費的，但每年幾百萬美元，這是什麼樣的想法？

Yes. And you bring up a good point between what Vanessa positioned that we've got about $3 million tied with expenses for being publicly traded. And today, we're a company that has sales in that $35 million range position, right? It just speaks to this potential efficiency processes. I would just leave that as part of the whole discussion around looking at strategic options that bring value to S&W shareholders.

是的。您提出的這個觀點與 Vanessa 的主張相符，Vanessa 表示，我們有大約 300 萬美元與公開交易費用有關。現在，我們的公司銷售額已經達到了 3500 萬美元左右，對嗎？這只是說明了這個過程具有潛在的效率。我只是將其作為尋找能為 S&W 股東帶來價值的策略選擇的整個討論的一部分。

Great, that makes sense. Appreciate it.

太好了，這很有道理。非常感謝。

(Operator Instructions)

（操作員指示）

Operator, we've got -- while we wait to see if there's anyone else in the queue, I have just a couple of questions here from the online portal to Mark and Vanessa. I'll try to bucketize them briefly here. Talk about maybe any competitive products out there, specifically within the herbicide resistance sorghum?

接線員，我們正在等待查看隊列中是否還有其他人，我在這裡想透過線上入口網站向馬克和凡妮莎提幾個問題。我將嘗試在這裡對它們進行簡要的分類。能否談談市面上是否有任何競爭產品，特別是抗除草劑高粱？

Yes. So there's two other programs that are in the marketplace. And S&W has had a significant lead over each of those positions, both in volume and market penetration as well as farmer feedback as far as we control cropping options and others. So as we look at it, we're in a very, very strong position. And then with the pipeline, as it comes out, I do believe we can work to keep market leadership position, not just on DT and grass control, but also across a broad spectrum that brings value to farmers.

是的。市場上還有另外兩個項目。就我們控制的種植選擇和其他方面而言，S&W 在每個領域都佔據了顯著的領先地位，無論是在產量和市場滲透率方面，還是在農民反饋方面。因此，從我們的角度來看，我們處於非常非常有利的地位。隨著產品線的推出，我相信我們可以努力保持市場領導地位，不僅在 DT 和草類控制方面，而且在為農民帶來價值的廣泛領域。

Everything is predicated on does your product truly turn into a positive economic investment for farmers, and we feel very good about the portfolio that we've got. And our approach has really been looking pretty directly at the economic impact. But as you look at peace of mind and other intrinsic values, I think part of the acceleration of our trade portfolio is going to be driven and has been driven the peace of mind of knowing you're going to be able to rescue your crop in the event of heavy pressure.

一切都取決於您的產品是否真正成為農民的積極經濟投資，我們對現有的產品組合感到非常滿意。我們的方法實際上是直接關注經濟影響。但是，當你考慮到內心的平靜和其他內在價值時，我認為我們的貿易組合加速增長的部分原因在於，並且已經在於，當面臨巨大壓力時，你知道自己能夠拯救你的作物，這種內心的平靜已經得到推動。

Same thing with Prussic Acid Free, if you know much about grazing cattle on sorghum, both the benefits and the drawbacks. The big drawback is prussic acid and the concern for animal health, which Prussic Acid Free completely resolves and puts a farmer in a great position to be able to utilize the great benefits of using a forge or even a post-harvest grain sorghum to provide feed for their livestock. So I believe we've got a strong position as far as the pipeline and where we're currently at for success. There's a significant advantage to our product position.

與不含氫氰酸的情況相同，如果您對在高粱上放牧牛群了解很多，您就會知道它的好處和壞處。最大的缺點是氫氰酸和對動物健康的擔憂，而無氫氰酸完全解決了這個問題，讓農民能夠充分利用使用鍛造爐甚至收穫後的高粱為牲畜提供飼料的巨大好處。因此我相信，就通路而言，我們在當前取得成功方面具有強勢地位。我們的產品定位具有顯著優勢。

Okay. Maybe just one more question here. Maybe just -- and I think you've touched on a few of these, but more broadly with some of the tariffs, some of the other subsidies, basically just overall change in administration. What sort of impact to this have you taken into account with the estimates that you provided here?

好的。也許這裡還剩下一個問題。也許只是——我想你已經談到了其中的一些，但更廣泛地說，是一些關稅、一些其他補貼，基本上只是行政管理的整體變化。您在此處提供的估計中考慮了對此產生哪些影響？

Well, that's a great question, Robert. And I called it out a bit. And internally, we've had the discussions around the tariffs. China is the number-one importer of sorghum globally, right? And where the US is the number-one exporter. So there's a pretty tight relationship between China and the US as far as sort of consumption. And then there's the concern around tariffs where they could go and what could be the response from China to those, right?

嗯，羅伯特，這個問題問得真好。我稍微喊了一下。在內部，我們已經就關稅問題進行了討論。中國是全球最大的高粱進口國，對嗎？美國是第一大出口國。因此，就消費而言，中國和美國之間的關係非常緊密。然後人們擔心關稅會走向何方，以及中國對此會作何反應，對嗎？

So unfortunately, all of it is speculation and assessment. Clearly, if they have a block on importing US products or a significant tariff, it could significantly hamper sorghum pricing in the sorghum market. But we have not built overly aggressively, conservatism based on an assumption that will happen, right? It's something we'll watch for. We'll know more as we go forward. And it's a sensitivity, but it is not built into the numbers today.

所以不幸的是，這一切都只是猜測和評估。顯然，如果他們禁止進口美國產品或徵收高額關稅，這可能會嚴重阻礙高粱市場的高粱定價。但是我們並沒有基於將會發生之事的假設而建立過於激進的保守主義，對嗎？我們會關注此事。隨著我們不斷前進，我們會了解更多。這是一種敏感性，但它並沒有被體現在今天的數字中。

Okay. Fantastic. All right, Mark, Vanessa, I'm showing no further questions here. So Mark, I guess I'll turn it over to you for closing remarks.

好的。極好的。好的，馬克，瓦妮莎，我沒有其他問題了。馬克，我想我會把它交給你來做結束語。

I really want to thank everybody for joining this morning. Really appreciate your engagement with S&W in this call. And Vanessa and I look forward to hopefully speaking with you all again shortly. Thank you.

我非常感謝大家今天早上的參加。非常感謝您與 S&W 進行此通話。瓦妮莎和我期待著很快能再次與大家交談。謝謝。

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

會議現已結束。感謝您參加今天的演講。您現在可以斷開連線。