Beijing, China
May 5, 2022

Origin Agritech Ltd. (NASDAQ: SEED) (the "Company" or "Origin"), an agriculture technology company, announced revenue for the first half of fiscal 2022 of RMB46.4 million (US $7.3 million) an increase of 300% vs. first half 2021, and earnings of RMB1.3 million (US $0.2 million, or $0.03 per share).

Summary of Financial Results 6 Month Period Ending March 31, 2022

The company had RMB6.5 million (US $1 million) cash on 3/31/22 vs. RMB 15.4 million on 9/30/21. The cash was used to ramp up seed production and for other working capital purposes that funded the company's rapid growth. The company has access to borrowing under credit facilities that can be accessed as needed to fund future growth. Origin's complete financials will be filed under a form 6-K with the SEC that will be accessible on the company's website at: SEC Filings - Origin Agritech.

Growth drivers

Growth in the first half of 2022 came from the sale of the company's new high yield, disease tolerant corn variety that can adapt to stressful environments. During the 2021 growing season one of China's main growing areas experienced extreme weather fluctuations of drought followed by massive flooding. Despite this, the variety performed extremely well in this environment while other corn varieties planted nearby were decimated. This created goodwill for the Origin Agritech brand and big demand for the new hybrid seed. Origin did not have enough seed to meet demand and are expanding our seed production to meet anticipated 2023 demand.

What's ahead for Origin?

Despite the company's rapid growth rate in the first half of 2022, the company's biggest growth driver in the near-term, sale of its nutritionally enhance corn (NEC), contributed nothing to sales in the period but rather will hit in the second half of the year, after the harvest. We have formed joint venture companies with our feedstock partners and are busy ramping up production of NEC using contract growing. The partners are responsible for the capital expenditures for the contract growing and Origin supplies the seed and technical support. The annual feed corn market is China is estimated at over 1.9 million metric tons and worth more than RMB500 billion ($75 billion). Origin expects to capture a significant portion of this market in the coming years as the NEC alleviates the need for expensive nutritional additives and thus doubles the profit margin for feedstock companies. Importantly, there is no other corn variety with similar properties, leaving Origin without competition for this product.

Origin continues to extend its leadership in next generation breeding technologies. The company has been an early adopter of CRISPR for corn gene editing and has created more than a dozen desirable traits including the recently announced change of leaf angle that allows for denser planting of the corn plants and thus higher yield. The company has already integrated these traits into the company's hybrid corn and is filing for approval.

Origin is encouraged by the Chinese government's continued progress on establishing the legal framework regulating the commercialization of GMO crops and views this as a sign that they will soon move to legalizing the planting of GMO crops. The company has integrated its GMO traits into its hybrid corn varieties and is ready to launch commercial sales once the governmet approves GMO.

Origin is reaffirming its 2022 full-year guidance of 300% sales growth. Additionally, the company expects continued and improving profitability.

"Origin has many tools in its toolbox for corn breeding," said Dr. Gengchen Han, Origin Agritech's Chairman. "We are using these tools to create bespoke new corn varieties that meet our customers' needs and this is creating a lot of buzz for the Origin Agritech brand. We are confident that this innovation will create great returns for Origin's shareholders, customers, and employees."

Website: http://www.originagritech.com

Published: May 9, 2022