Company: EVGN
Filing Date: 2025-03-27
Form Type: 20-F
Source: 0001178913-25-001092
Chunk: 283

Company: Evogene Ltd.
Filing Date: 2025-03-27
Form: 20-F
Item: Item 11
Chunk 283
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                         ITEM 11.                         
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
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We are exposed to market risk from changes in exchange rates, interest rates and inflation. We therefore continue to closely monitor the macro-economic conditions that result therefrom. We regularly assess the implications of these global conditions on our operations, liquidity, cash flow and product candidates and seek to act to mitigate any adverse consequences, to the extent possible, in a commercially reasonable manner, if and when applicable. For a sensitivity analysis of our exposure to foreign currency exchange fluctuations, see Note 13c to our consolidated financial statements as of, and for the year ended, December 31, 2024 included elsewhere in this Annual Report.
 
Foreign Currency Risk
 
A significant portion of our expenses is denominated in currencies other than the U.S. dollar. We are therefore subject to non-U.S. currency risks and non-U.S. exchange exposure, especially the NIS. A significant portion of our operating costs are in Israel, consisting principally of salaries and related personnel expenses, and facility expenses, which are denominated in NIS. This foreign currency exposure gives rise to market risk associated with exchange rate movements of the U.S. dollar against the NIS and other currencies. Furthermore, we anticipate that a significant portion of our expenses will continue to be denominated in NIS. We do not hedge against currency risk through the use of forward currency contracts or other financial instruments. See “Risk factors— Risks Relating to Our Incorporation and Location in Israel-Exchange rate fluctuations between the U.S. dollar and the NIS may negatively affect our financial results.” Exchange rates can be volatile and a substantial change of foreign currencies against the U.S. dollar could increase or reduce the Company’s expenses and net loss and impact the comparability of results from period to period.
 
Most of our revenues are denominated in U.S. dollars. By contrast, we incur expenses primarily denominated in NIS. As a result, any appreciation of the NIS relative to the U.S. dollar adversely impacts our profitability due to the portion of our expenses that are incurred in NIS. The depreciation of the NIS relative to the U.S. dollar, based on average exchange rates throughout the year, was 0.3% and 9.7% during 2024 and 2023, respectively. In the future we may enter into hedging transactions in order to decrease our foreign currency risk; however, these transactions may not