Core Points - SenesTech, Inc. announced the closing of the exercise of outstanding warrants to purchase 1,458,872 shares of common stock at an exercise price of $2.90 per share, generating approximately $4.4 million in gross proceeds [1][4] - The company issued new unregistered short-term warrants for the same number of shares at an exercise price of $4.15 per share, with a purchase price of $0.125 per warrant, potentially raising an additional $6.0 million if fully exercised [3][4] - The net proceeds from the transaction are intended for working capital and general corporate purposes [4] Company Overview - SenesTech is focused on humane management of animal pest populations through fertility control, having developed products like ContraPest®, the only U.S. EPA-registered contraceptive for rats, and Evolve™ products for rodents [8]

Core Viewpoint - SenesTech, Inc. has entered into definitive agreements for the immediate exercise of outstanding warrants to purchase 1,458,872 shares of common stock at an exercise price of $2.90 per share, with the transaction expected to close around July 1, 2025 [1] Group 1: Warrant Exercise and Financial Details - The company will issue new unregistered short-term warrants to purchase an additional 1,458,872 shares at an exercise price of $4.15 per share, with a purchase price of $0.125 per warrant [3] - The gross proceeds from the exercise of existing warrants are expected to be approximately $4.4 million, while potential gross proceeds from the new short-term warrants could reach approximately $6.0 million if fully exercised [4] - The net proceeds from the transaction are intended for working capital and general corporate purposes [4] Group 2: Regulatory and Compliance Information - The resale of shares from the existing warrants has been registered under an effective registration statement on Form S-3 [5] - The new short-term warrants have not been registered under the Securities Act of 1933, and may not be offered or sold in the U.S. without an effective registration statement or applicable exemption [6] Group 3: Company Overview - SenesTech is focused on humane management of animal pest populations through fertility control, with products like ContraPest® and Evolve™ designed for effective pest management [8]

Core Insights - SenesTech, Inc. has reported successful results from urban deployments of its Evolve™ Rat Birth Control in Hong Kong and San Francisco, demonstrating a faster and more sustainable approach to rodent control by combining fertility control with traditional rodenticides [1][3][5] Group 1: Urban Rodent Challenges - Global cities are facing persistent rodent issues due to dense infrastructure, hard-to-access breeding sites, and abundant food sources, leading to the inadequacy of traditional rodenticide programs over time [2] - Rodents have shown adaptability to poisons, resulting in unchecked reproduction despite aggressive control measures [2] Group 2: Integrated Pest Management Strategy - The integrated strategy employed in Hong Kong involved deploying Evolve's palatable soft bait alongside conventional rodenticide blocks, leading to a significant reduction in rodent sightings and no new litters detected within three months [3][4] - In San Francisco, a similar approach resulted in reduced visible rodent activity, decreased overall poison usage, and a measurable drop in new rodent births [4] Group 3: Industry Implications - The success of these deployments indicates that fertility control can serve as a practical tool for pest professionals, enhancing integrated pest management (IPM) programs and reducing reliance on rodenticides [5] - The company is preparing for a container-sized order from Hong Kong, signaling rapid expansion and increased demand for its products [5] Group 4: Market Opportunities - Fertility control solutions like Evolve align with evolving environmental regulations and public demand for humane, low-toxicity pest management, offering improved outcomes and better ROI for pest control professionals and property owners [6] - This trend indicates a rapidly growing global market for next-generation rodent control solutions that complement traditional methods [6]

Core Insights - SenesTech, Inc. has successfully completed a nine-month field trial of its Evolve™ Rat Birth Control at the University Hills community, marking a significant step in ecologically responsible pest management [1][2][3] - The initiative, driven by resident demand, aimed to eliminate rodenticides in favor of integrated pest management strategies that prioritize environmental safety [2][5] - Evolve was deployed across 267 bait stations, achieving a 98% consumption rate among rats, indicating high acceptance and effectiveness of the bait [3][5] Company Overview - SenesTech specializes in fertility control solutions for managing animal pest populations, with products like ContraPest® and Evolve™ designed to be humane, effective, and sustainable [7] - The company emphasizes its commitment to improving global health through responsible pest management practices [7] Community Engagement - The project involved collaboration with the Irvine Campus Housing Authority and the grassroots initiative HOOT Group, which promotes owl nesting to reduce reliance on rodenticides [4][5] - The community's transition away from rodenticides has led to reduced rodent complaints and less observed rodent activity [5] Future Plans - SenesTech is placing a multi-pallet restocking order for continued deployment and expansion of its products [6]

Core Insights - SenesTech has entered a distribution agreement with Bradley Caldwell, Inc. to enhance the availability of Evolve™ Rodent Birth Control in rural America [1][2] - The partnership aims to leverage BCI's extensive network of over 8,000 dealers to improve access to rodent control solutions in agricultural communities [1][2] - This agreement represents a significant step in SenesTech's commercialization strategy, with BCI's initial order being the largest distributor stocking order received by the company [3] Company Overview - SenesTech specializes in fertility control for managing animal pest populations, with products like ContraPest and Evolve designed to be humane and effective [4] - The company focuses on providing sustainable pest management solutions that integrate into existing pest management programs [4] Strategic Benefits - The partnership with BCI is expected to accelerate market penetration in underserved areas where traditional rodenticides face challenges [7] - BCI customers will gain a competitive edge by offering a scientifically-backed, humane alternative to traditional poisons [7] - The collaboration supports SenesTech's long-term growth strategy, anticipating revenue increases from expanded retail sales and new customer acquisition [7]

Summary of SenesTech (SNES) 2025 Conference Call Company Overview - **Company**: SenesTech, a biotech and life sciences company focused on rodent control through reproductive management rather than lethal methods [5][6] - **Ticker Symbol**: SNES, traded on NASDAQ [4] Core Product and Market Strategy - **Flagship Product**: Evolve, launched in 2024, is a soft bait designed for rodent fertility control, which has quickly become the top-selling product [12][14] - **Sales Growth**: Evolve sales grew by 40% year-over-year in Q1 2025 [15][37] - **Market Opportunity**: The U.S. rodenticide market is estimated at $1 billion annually, with a global market of $4.5 billion [34] Unique Selling Proposition - **Sustainable Approach**: Focus on controlling the birth rate of rodents rather than relying on poisons, which have social, political, and ecological drawbacks [6][8][30] - **Product Safety**: Evolve is designated as a minimum risk product by the EPA, using cottonseed oil as the active ingredient, making it safer for pets and wildlife [14][16] Distribution Channels - **Six Channel Strategy**: Includes e-commerce, agriculture distributors, pest management distributors, retail (e.g., Ace Hardware), international distributors, and direct sales to large customers [18][19] - **E-commerce Growth**: E-commerce sales increased by over 7%, with a run rate approaching $60,000 to $70,000 per month [20][21] Municipal and International Opportunities - **Municipal Deployments**: Significant projects in Chicago and New York City, with repeat orders indicating product effectiveness [23][24][25] - **International Expansion**: Exclusive distribution agreements signed in 12 countries, with expected approvals in Australia and New Zealand [27][28] Financial Performance - **Revenue Growth**: Record revenue of $1.9 million in 2024, up 56% from the previous year [39] - **Gross Margin Improvement**: Gross margins for Evolve reached 64%, compared to 32% in Q1 of the previous year [40] - **Cost Optimization**: Initiatives to reduce operating costs include pausing new product development and optimizing sales efforts [44] Future Outlook - **Path to Profitability**: Aiming for cash flow breakeven at approximately $1.5 million per quarter, with current revenues around $500,000 per quarter [45][46] - **Market Trends**: Increasing awareness of the need for humane rodent control solutions due to public health concerns and regulatory changes [52][53] Key Takeaways - **Transformative Opportunity**: SenesTech believes it has a paradigm-changing product that addresses long-standing rodent control issues in a sustainable manner [55][56] - **Execution Strategy**: Focus on expanding market presence, improving product offerings, and enhancing operational efficiencies to drive future growth [54][56]

Company Participation - SenesTech, Inc. will participate in a webcast fireside chat and host one-on-one meetings with investors at the Lytham Partners Spring 2025 Investor Conference on May 29, 2025 [1] - The webcast presentation is scheduled for 3:30 p.m. ET and will be accessible via the conference home page or directly through a provided link [2] - Management will engage in virtual one-on-one meetings throughout the event, with arrangements available through Lytham Partners [3] Company Overview - SenesTech is focused on improving global health by managing animal pest populations through fertility control solutions [4] - The company developed ContraPest, the only U.S. EPA-registered contraceptive for male and female rats, along with Evolve and Evolve Mouse, which are EPA-designated minimum risk contraceptives for rodents [4] - SenesTech aims to integrate its products into pest management programs to enhance effectiveness and promote humane, safe, and sustainable pest control [4]

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $485,000, an increase of 17% from Q1 2024 [17] - EVOLVE revenue grew by 40% and accounted for 79% of total sales, while ContraPest revenue decreased by approximately 40% [17] - Gross margins increased to 64.5% compared to 32.5% in Q1 2024, with gross profit rising by 132% to $313,000 [20][21] Business Line Data and Key Metrics Changes - EVOLVE product line significantly contributed to revenue growth, with e-commerce sales increasing by 107% [10][18] - Municipal sales saw a sevenfold increase compared to the previous year, driven by new deployments in major cities [19] - ContraPest, while deemphasized, still retains a loyal customer base and is expected to continue generating revenue [17] Market Data and Key Metrics Changes - E-commerce accounted for 61% of overall Q1 sales, with Amazon being the predominant channel [18] - International sales were not recognized in Q1 but are anticipated to grow with pending regulatory approvals in various markets [19][12] Company Strategy and Development Direction - The company is focusing on expanding the EVOLVE product line and enhancing operational efficiencies to achieve profitability [15][25] - Strategic initiatives have been implemented to reduce expenses by $2 million annually, which should improve financial performance in upcoming quarters [15][22] - The company aims to penetrate various markets, including agriculture, zoos, and residential applications, to drive future growth [27] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the potential for significant growth in municipal applications and other markets [26] - The company is on a pathway to profitability, with a reduced revenue threshold for cash flow breakeven set at $1.5 million quarterly [16][22] - There is a clear focus on executing strategies effectively while maintaining efficiency [25] Other Important Information - The company completed a strategic financing during Q1, raising $1 million and issuing $4 million in short-term warrants [23] - The new larger facility in Phoenix is expected to support increasing demand without significantly raising costs [21] Q&A Session Summary - No questions were asked during the Q&A session, leading to a conclusion of the call [29]

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $485,000, an increase of 17% from Q1 2024 [17] - EVOLVE revenue grew by 40% and accounted for 79% of total sales, while ContraPest revenue decreased by approximately 40% [17] - Gross margins increased to 64.5% compared to 32.5% in Q1 2024, with gross profit rising by 132% to $313,000 [20][21] Business Line Data and Key Metrics Changes - EVOLVE product line is driving growth, with significant revenue contributions from e-commerce, which accounted for 61% of total sales and increased by 107% year-over-year [18] - Municipal sales saw a sevenfold increase compared to the previous year, driven by new deployments in major cities [19] - ContraPest continues to have loyal customers, but its sales are being deemphasized as the company focuses on EVOLVE [17] Market Data and Key Metrics Changes - E-commerce sales have expanded to platforms like Amazon, Walmart, and Tractor Supply, contributing significantly to revenue growth [10] - International operations are expected to grow, with agreements signed in 12 countries, including Indonesia and the Philippines [12] - No international sales were recognized in Q1, but potential significant orders are pending regulatory approval [19] Company Strategy and Development Direction - The company is focusing on expanding the EVOLVE product line and improving operational efficiencies to achieve profitability [15][25] - Strategic initiatives have been implemented to reduce expenses by $2 million annually, which will help lower the revenue threshold for cash flow breakeven to $1.5 million quarterly [15][22] - The company aims to revolutionize pest control, particularly in municipal applications, agriculture, and commercial sectors [26][27] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth potential in municipal deployments and e-commerce, anticipating continued success in these areas [10][11] - The company is focused on executing its strategy effectively to capitalize on market opportunities and achieve profitability [25][28] - Management highlighted the importance of operational optimization and the potential for significant revenue growth from new markets [25][26] Other Important Information - The company completed a strategic financing that raised $1 million and included short-term warrants, providing additional capital without significant dilution [23] - The company has moved into a larger facility to meet increasing demand without dramatically increasing costs [21] Q&A Session Summary - No questions were asked during the Q&A session, and the call concluded without further inquiries [29]

[PART I — FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20%E2%80%94%20FINANCIAL%20INFORMATION) This section presents the unaudited condensed financial statements, management's discussion and analysis, and disclosures on market risk and internal controls for the period ended March 31, 2025 [Item 1. Financial Statements (unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20%28unaudited%29) The unaudited condensed financial statements for Q1 2025 show a year-over-year revenue increase to **$485,000**, a reduced net loss of **$1.7 million**, and highlight a significant going concern risk with existing cash expected to fund operations for only the next four months - Auditors express substantial doubt about the company's going concern ability due to a history of operating losses and an accumulated deficit of **$137.8 million** as of March 31, 2025[23](index=23&type=chunk)[24](index=24&type=chunk)[27](index=27&type=chunk) - Existing cash and cash equivalents of **$1.7 million** as of March 31, 2025, are projected to fund operations for only the next four months, necessitating additional financing[29](index=29&type=chunk)[84](index=84&type=chunk) [Condensed Balance Sheets](index=4&type=section&id=Condensed%20Balance%20Sheets) As of March 31, 2025, total assets increased to **$3.6 million** and total stockholders' equity improved to **$2.9 million** due to capital raising, while total liabilities slightly decreased to **$0.7 million** Condensed Balance Sheet Data (in thousands) | Account | March 31, 2025 (unaudited) | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $1,655 | $1,307 | | Total current assets | $3,164 | $2,813 | | **Total assets** | **$3,626** | **$3,278** | | **Liabilities & Equity** | | | | Total current liabilities | $543 | $561 | | **Total liabilities** | **$734** | **$767** | | **Total stockholders' equity** | **$2,892** | **$2,511** | | **Total liabilities and stockholders' equity** | **$3,626** | **$3,278** | [Condensed Statements of Operations and Comprehensive Loss](index=5&type=section&id=Condensed%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) For Q1 2025, revenues increased **17%** year-over-year to **$485,000**, gross profit surged **132%** to **$313,000**, and net loss improved to **$1.7 million** from **$1.8 million** in the prior year Q1 2025 vs Q1 2024 Performance (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenues, net | $485 | $415 | | Cost of sales | $172 | $280 | | **Gross profit** | **$313** | **$135** | | Total operating expenses | $1,976 | $1,978 | | Loss from operations | ($1,663) | ($1,843) | | **Net loss** | **($1,665)** | **($1,832)** | | Net loss per share - basic and diluted | ($1.28) | ($3.56) | [Condensed Statements of Cash Flows](index=6&type=section&id=Condensed%20Statements%20of%20Cash%20Flows) In Q1 2025, net cash used in operating activities was **$1.6 million**, offset by **$1.9 million** from financing activities, resulting in a net increase in cash of **$0.3 million** and ending the period with **$1.7 million** in cash and cash equivalents Cash Flow Summary (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | ($1,557) | ($1,829) | | Net cash used in investing activities | ($36) | ($2) | | Net cash provided by (used in) financing activities | $1,941 | ($2) | | **Increase (decrease) in cash** | **$348** | **($1,833)** | | **Cash and cash equivalents, end of period** | **$1,655** | **$3,562** | [Notes to Condensed Financial Statements](index=7&type=section&id=Notes%20to%20Condensed%20Financial%20Statements) The notes detail the company's pest fertility control business, including new product launches, significant customer concentration, substantial financing activities, and a material legal contingency involving a trade secret misappropriation lawsuit - The company's lead product is Evolve Rat, launched in January 2024, with Evolve Mouse launched in May 2024, both being minimum risk pesticides exempt from federal EPA registration[19](index=19&type=chunk)[20](index=20&type=chunk)[21](index=21&type=chunk) - In March 2025, a warrant inducement transaction generated **$1.1 million** in gross proceeds from issuing **374,718 shares** and new short-term warrants for over **1.5 million shares**[55](index=55&type=chunk)[57](index=57&type=chunk)[61](index=61&type=chunk) - During Q1 2025, **365,319 shares** were sold under the ATM facility for **$1.2 million** in gross proceeds, with the facility expanded in April 2025[58](index=58&type=chunk)[71](index=71&type=chunk) - Liphatech Inc. is suing the company for breach of contract and trade secret misappropriation, with the company asserting strong defenses despite an uncertain outcome and no accrued settlement amount[69](index=69&type=chunk) - Customer concentration is significant, with one customer representing **31%** of Q1 2025 revenue and **50%** of accounts receivable as of March 31, 2025[67](index=67&type=chunk)[68](index=68&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management's discussion highlights critical liquidity challenges and reliance on external financing despite a **17%** year-over-year revenue increase driven by the higher-margin Evolve product line, which improved gross profit margin to **64.5%** - The company has a history of significant operating losses, with an accumulated deficit of **$137.8 million** as of March 31, 2025, and expects these losses to continue[80](index=80&type=chunk)[81](index=81&type=chunk) - Existing cash, anticipated revenue, and equity sales are projected to fund operations for only the next four months, making additional financing critical for survival[84](index=84&type=chunk)[96](index=96&type=chunk) - The company may never achieve profitability or positive cash flow and requires continuous capital raising, with failure to do so potentially leading to operational delays or termination[85](index=85&type=chunk)[96](index=96&type=chunk) [Results of Operations](index=24&type=section&id=Results%20of%20Operations) Q1 2025 revenue grew **17%** year-over-year to **$485,000**, primarily from the Evolve product line, which significantly improved gross margin to **64.5%** while total operating expenses remained flat Revenue Breakdown by Product (in thousands) | Product | Q1 2025 Revenue | % of Total | Q1 2024 Revenue | % of Total | | :--- | :--- | :--- | :--- | :--- | | Evolve Rat | $303 | 62% | $250 | 60% | | Evolve Mouse | $81 | 17% | $— | 0% | | ContraPest | $101 | 21% | $165 | 40% | | **Revenues, net** | **$485** | **100%** | **$415** | **100%** | - Gross profit margin increased to **64.5%** in Q1 2025 from **32.5%** in Q1 2024, driven by a product mix shift to the lower-cost Evolve line[88](index=88&type=chunk) - R&D expenses increased by **$48,000** (**13%**) primarily due to personnel realignment to R&D activities[90](index=90&type=chunk) - SG&A expenses decreased by **$50,000** (**3%**) due to reduced headcount and lower personnel costs, partially offset by severance and increased investor relations consulting fees[91](index=91&type=chunk) [Liquidity and Capital Resources](index=27&type=section&id=Liquidity%20and%20Capital%20Resources) The company faces critical liquidity, with **$1.7 million** in cash projected to last only four months, necessitating additional capital to fund operations and R&D, despite **$1.9 million** raised in Q1 2025 from ATM sales and warrant exercises Sources and Uses of Cash (in thousands) | Cash Flow | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash used in Operating activities | ($1,557) | ($1,829) | | Net cash used in Investing activities | ($36) | ($2) | | Net cash provided by Financing activities | $1,941 | ($2) | | **Cash and cash equivalents, end of period** | **$1,655** | **$3,562** | - Net cash from financing activities in Q1 2025 totaled **$1.9 million**, including **$1.1 million** from the ATM Facility and **$889,000** from warrant exercises[105](index=105&type=chunk) - The company anticipates continued or increased expenses as it focuses on marketing, sales, regulatory approvals, and product development[97](index=97&type=chunk)[103](index=103&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=29&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section is not applicable as the company is a smaller reporting company - Quantitative and qualitative disclosures about market risk are not applicable for the company[108](index=108&type=chunk) [Item 4. Controls and Procedures](index=29&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of the report period end[111](index=111&type=chunk) - No material changes to internal control over financial reporting occurred during the quarter[112](index=112&type=chunk) [PART II — OTHER INFORMATION](index=30&type=section&id=PART%20II%20%E2%80%94%20OTHER%20INFORMATION) This section details legal proceedings, risk factors, other information, and exhibits filed with the report [Item 1. Legal Proceedings](index=30&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in legal proceedings, including a lawsuit filed by Liphatech Inc. in December 2024, with details provided in Note 10 of the financial statements - The company refers to Note 10, Contingencies, for information on legal proceedings, specifically detailing a lawsuit from Liphatech Inc[114](index=114&type=chunk)[69](index=69&type=chunk) [Item 1A. Risk Factors](index=30&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2024 - No material changes to the risk factors from the Annual Report on Form 10-K for the year ended December 31, 2024, have been reported[115](index=115&type=chunk) [Item 5. Other Information](index=30&type=section&id=Item%205.%20Other%20Information) During the quarter ended March 31, 2025, no director or officer of the company adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement - No director or officer adopted or terminated a Rule 10b5-1 trading arrangement during Q1 2025[116](index=116&type=chunk) [Item 6. Exhibits](index=30&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including forms of common stock purchase warrants, an inducement letter, and officer certifications - Exhibits filed include forms for Series G Common Stock Purchase Warrants, Placement Agent Warrants, and CEO/CFO certifications[117](index=117&type=chunk) [Signatures](index=31&type=section&id=SIGNATURES) This section contains the official signatures of the company's executive officers, certifying the report's contents - The report was signed on May 8, 2025, by Joel L. Fruendt, President and Chief Executive Officer, and Thomas C. Chesterman, Executive Vice President and Chief Financial Officer[120](index=120&type=chunk)[122](index=122&type=chunk)[123](index=123&type=chunk)