Energy crop company Ceres Inc. announced on Thursday strong revenue growth in its fiscal third quarter but losses that exceeded Wall Street estimates.
The Thousand Oaks agricultural biotech reported a net loss of $9.3 million (-38 cents a share) in the third quarter ended May 31, compared with a net loss $8.4 million (-34 cents) in the same period a year earlier. Revenue rose 27 percent to $1.4 million.
Wall Street analysts forecast a loss of 31 cents on revenue of $1.05 million, according to Thomson Financial Network.
The company develops seeds for crops that are used by energy companies to ferment into ethanol. The firm has partnered with 31 ethanol mills in Brazil for seed sales and crop management services for the current growing season.
Cost of sales rose to $2.1 million from $600,000, while other administrative and other expenses rose to $4.5 million from $3.3 million operations expanded in Brazil. Research and development costs fell sharply to $1.2 million from $4.1 million.
Chief Executive Richard Hamilton said the company is positioned for strong growth, though weak crop yields could slow sales in the short term.
Ceres reported that ethanol yields of its sweet sorghum crops were 50 percent higher than last year, but were more variable that expected.
“As a result, we expect total sweet sorghum seed sales next season to grow more modestly than originally anticipated,” he said, in a prepared statement.
Shares gained 34 cents, or nearly 12 percent, to close at $3.25 on the Nasdaq.