Company reports $182.3 million in
revenue for the second quarter
Second quarter non-GAAP net income of $8
million, or $0.15 per diluted share; and GAAP net loss
of $23 million, or ($0.55) per diluted share
Company provides update to financial
guidance
Stratasys Ltd. (NASDAQ:SSYS) today announced financial
results for the second quarter of 2015.
Q2-2015 Financial Results Summary:
- Revenue for the second quarter of 2015
was $182.3 million, compared to $178.5 million for the same
period last year;
- GAAP net loss for the second quarter
was $22.9 million, or ($0.55) per diluted share, compared to GAAP
net loss of $173,000, or ($0.00) per diluted share, for the same
period last year.
- Non-GAAP net income for the second
quarter was $8 million, or $0.15 per diluted share, compared
to non-GAAP net income of $28.0 million, or $0.55 per diluted
share, reported for the same period last year.
- The Company invested a net amount
of $22.5 million in R&D projects (non-GAAP basis)
during the second quarter, representing 12% of revenues.
- The Company used $15.6
million in cash for operations during the second quarter, and
currently holds approximately $502.6 million in cash and cash
equivalents, and short term bank deposits. The cash balance
includes a $175 million drawdown on the Company’s revolving credit
facility.
- Non-GAAP EBITDA for the second quarter
amounted to $12.1 million.
- The Company sold 6,731 3D printing and
additive manufacturing systems during the second quarter, and has
sold a total of 135,928 systems worldwide as of June 30, 2015,
on a pro forma combined basis.
“The merger between Stratasys and Objet in 2012 created
synergies that combined with the heightened level of mainstream
media attention within our industry, have contributed to a period
of extraordinary growth for our company and industry over the past
two years,” said David Reis, chief executive officer of Stratasys.
“We believe our industry is transitioning through a period of
slower growth, as users digest their investments in 3D printing and
expand the utilization of recently acquired capacity. Despite these
headwinds, and certain ongoing macroeconomic challenges in Asia, we
are encouraged by sequential improvement in areas of our business,
and remain optimistic about our longer-term growth prospects.”
Business Highlights:
- Strengthened presence in Germany,
Switzerland, and Austria through the acquisition of a key German
channel partner, RTC Rapid Technologies GmbH; and made
additional North American channel enhancements with the addition of
W.D. Distributing, WYNIT, and Sam’s Club.
- Partnered with CAD industry leader PTC,
to provide improved integration between PTC Creo product design
software and Stratasys 3D Printing Solutions.
- Enhanced high-end system capabilities
with release of the Objet1000 Plus 3D Production System, providing
significant speed improvements; as well as introduced a new
high-volume filament packaging solution for Fortus 3D Production
Systems.
- Observed significant expansion within
the dental vertical, including the further adoption of our
Stratasys PolyJet based solutions for the production of custom-made
orthodontic products.
- Announced a multi-year collaboration
with the Kangshua Group that includes providing up to 1,000
Solidscape high precision 3D printers to equip multiple new service
bureaus and innovation centers in China; as well as the opening of
a manufacturing facility, by Kangshua, to locally assemble
Solidscape 3D printers for the Chinese market.
- Reorganized the MakerBot channel in
Europe and Asia to help leverage the existing Stratasys
go-to-market infrastructure within those regions.
- Completed a customer event for
Stratasys Direct Manufacturing (SDM) that reached 239 customers and
introduced the combined SDM organization as a total solution
provider that focuses on applications from prototype to
production.
“We are observing positive indicators and are beginning to see
tangible results that reaffirm our strategy of developing targeted
solutions within key market verticals,” continued Reis.
“Short-term, we will continue to make adjustments to our expenses
to align with current market conditions. Long-term, we remain
committed to our growth initiatives that include enhancing vertical
solution capabilities, expanding customer support services,
accelerating product development, and growing the sales and
marketing infrastructure – all of which are designed to drive
future growth.”
2015 Guidance
Due to the Company’s limited visibility regarding the timing of
improvements in growth, the Company has withdrawn its previously
delivered full year 2015 financial guidance, and instead has
provided financial guidance for the third quarter of 2015 as
follows:
- Total revenue in the range of $175 to
$190 million, with non-GAAP net income in the range of $1.5 to $7.0
million, or $0.03 to $0.13 per diluted share.
- GAAP net loss of $27.0 million to $22.5
million, or ($0.52) to ($0.43) per share.
- Non-GAAP earnings guidance excludes $18
million of projected amortization of intangible assets; $9.5
million to $10.0 million of share-based compensation expense; $7
million to $8 million in non-recurring expenses related to
acquisitions; and includes $6.0 million to $6.5 million in tax
expenses related to non-GAAP adjustments.
Stratasys Ltd. Q2-2015 Conference Call Details
Stratasys will hold a conference call to discuss its second
quarter financial results on July 30, 2015 at 8:30 a.m. (ET).
The investor conference call will be available via live webcast
on the Stratasys Web site at www.stratasys.com under the
"Investors" tab; or directly at the following web address:
http://edge.media-server.com/m/p/izi2aqma.
To participate by telephone, the domestic dial-in number is
800-901-5241 and the international dial-in is 617-786-2963. The
access code is 55067799.
Investors are advised to dial into the call at least ten minutes
prior to the call to register. The webcast will be available for 90
days on the "Investors" page of the Stratasys Web site or by
accessing the provided web address.
Cautionary Statement Regarding Forward-Looking
Statements
Certain statements in this press are "forward-looking
statements" within the meaning of the Private Securities Litigation
Reform Act of 1995, Section 27A of the Securities Act of 1933, and
Section 21E of the Securities Exchange Act of 1934. Forward-looking
statements are characterized by the use of forward-looking
terminology such as "will," "expects," "anticipates," "continues,"
"believes," "should," "intended," "projected," “guidance,”
“preliminary,” “future,” “planned,” “committed,” and other similar
words. These forward-looking statements include, but are not
limited to, statements relating to the company's objectives, plans
and strategies, statements of preliminary or projected results of
operations or of financial condition and all statements that
address activities, events or developments that the company
intends, expects, projects, believes or anticipates will or may
occur in the future. Forward-looking statements are not guarantees
of future performance and are subject to risks and uncertainties.
The company has based these forward-looking statements on
assumptions and assessments made by its management in light of
their experience and their perception of historical trends, current
conditions, expected future developments and other factors they
believe to be appropriate. Important factors that could cause
actual results, developments and business decisions to differ
materially from those anticipated in these forward-looking
statements include, among other things: the company's ability to
efficiently and successfully integrate the operations of Stratasys,
Inc. and Objet Ltd. after their merger as well as MakerBot, Solid
Concepts, and Harvest Technologies after their acquisitions and to
successfully put in place and execute an effective post-merger
integration plans; the overall global economic environment; the
impact of competition and new technologies; general market,
political and economic conditions in the countries in which the
company operates; projected capital expenditures and liquidity;
changes in the company's strategy; government regulations and
approvals; changes in customers' budgeting priorities; litigation
and regulatory proceedings; the company's ability to satisfy the
financial covenants under its revolving credit facility; and those
factors referred to under "Risk Factors", "Information on the
Company", "Operating and Financial Review and Prospects", and
generally in the company's annual report on Form 20-F for the year
ended December 31, 2014 filed with the U.S. Securities and Exchange
Commission (the "SEC"), and in other reports that the company has
filed with or furnished to the SEC on the date hereof. Readers are
urged to carefully review and consider the various disclosures made
in the company's SEC reports, which are designed to advise
interested parties of the risks and factors that may affect its
business, financial condition, results of operations and prospects.
Any guidance and other forward-looking statements in this press
release are made as of the date hereof, and the company undertakes
no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as required by law.
Non-GAAP Discussion Disclosure
The information discussed within this release includes financial
results and projections that are in accordance with accounting
principles generally accepted in the United States of
America (GAAP). In addition, certain non-GAAP financial
measures have been provided excluding certain charges, expenses and
income. The non-GAAP measures should be read in conjunction with
the corresponding GAAP measures and should be considered in
addition to, and not as an alternative or substitute for, the
measures prepared in accordance with GAAP. The non-GAAP financial
measures are included in an effort to provide information that
investors may deem relevant to evaluate results from the company's
core business operations and to compare the company's performance
with prior periods. The non-GAAP financial measures primarily
identify and exclude certain discrete items, such as merger-related
expenses, amortization of intangible assets, one time write off of
deferred tax assets, impairment charges, reorganization and other
related costs, and expenses associated with share-based
compensation required under ASC 718. The company uses these
non-GAAP financial measures for evaluating comparable financial
performance against prior periods.
This release is available on the Stratasys web site
at www.stratasys.com
Stratasys Ltd. (Nasdaq:SSYS), headquartered in Minneapolis,
Minnesota and Rehovot, Israel, is a leading global provider of 3D
printing and additive manufacturing solutions. The company's
patented FDM® and PolyJet™ 3D Printing technologies produce
prototypes and manufactured goods directly from 3D CAD files or
other 3D content. Systems include 3D printers for idea development,
prototyping and direct digital manufacturing. Stratasys
subsidiaries include MakerBot and Solidscape, and the company
operates the digital parts manufacturing service Stratasys Direct
Manufacturing. Stratasys has more than 2,900 employees, holds over
800 granted or pending additive manufacturing patents globally, and
has received more than 30 awards for its technology and leadership.
Online at: http://www.stratasys.com or
http://blog.stratasys.com.
Stratasys Ltd. Consolidated Balance
Sheets (in thousands)
June 30,
December 31, 2015 2014
ASSETS Current assets Cash and cash
equivalents $ 352,268 $ 442,141 Short-term bank deposits 150,370
595 Accounts receivable, net 136,970 150,806 Inventories 137,394
123,385 Net investment in sales-type leases 10,091 8,170 Prepaid
expenses 9,898 7,931 Deferred income taxes 30,567 25,697 Other
current assets 31,420 37,903
Total current assets 858,978 796,628
Non-current assets Goodwill 1,172,125 1,323,502 Other
intangible assets, net 517,085 597,903 Property, plant and
equipment, net 185,992 157,036 Net investment in sales-type leases
- long term 19,093 14,822 Other non-current assets 10,960
9,216 Total non-current assets
1,905,255 2,102,479
Total assets
$ 2,764,233 $ 2,899,107
LIABILITIES AND
EQUITY Current liabilities Accounts payable $
40,687 $ 37,359 Short term debt 175,000 50,000 Accrued expenses and
other current liabilities 50,990 47,760 Accrued compensation and
related benefits 45,230 42,332 Obligations in connection with
acquisitions 12,003 28,092 Deferred revenues 48,821
45,023 Total current liabilities
372,731 250,566
Non-current
liabilities Obligations in connection with acquisitions - long
term 12,761 26,461 Deferred tax liabilities 36,293 55,835 Deferred
revenues - long-term 6,069 5,946 Other non-current liabilities
26,677 25,091 Total non-current
liabilities 81,800 113,333
Total liabilities 454,531 363,899
Redeemable non-controlling interests 2,564
3,969
Equity Ordinary shares, NIS 0.01 nominal value,
authorized 180,000 shares; 51,669 and 50,923 shares issued and
outstanding at June 30, 2015 and December 31, 2014, respectively
140 139 Additional paid-in capital 2,587,168 2,568,149 Accumulated
deficit (273,090 ) (33,871 ) Accumulated other comprehensive loss
(7,429 ) (3,647 ) Equity attributable to Stratasys
Ltd. 2,306,789 2,530,770 Non-controlling interest 349 469
Total equity 2,307,138 2,531,239
Total liabilities and equity $ 2,764,233 $ 2,899,107
Stratasys Ltd. Consolidated
Statements of Operations (in thousands, except per share
data)
Three Months Ended June 30, Six Months Ended June 30,
2015 2014 2015 2014 (unaudited)
(unaudited) (unaudited)
(unaudited) Net sales Products $ 134,490 $ 154,090 $
261,157 $ 283,342 Services 47,832 24,375
93,896 46,064 182,322 178,465
355,053 329,406
Cost of sales Products 67,666 73,394
166,037 134,416 Services 31,748 13,437
60,020 25,628 99,414 86,831 226,057
160,044
Gross profit 82,908
91,634 128,996 169,362
Operating expenses Research
and development, net 25,506 18,957 52,744 35,728 Selling, general
and administrative 97,581 77,929 200,189 145,546 Goodwill
impairment - - 150,400 - Change in the fair value of obligations in
connection with acquisitions (6,680 ) 628
(19,936 ) (6,867 ) 116,407 97,514 383,397 174,407
Operating loss (33,499 ) (5,880
) (254,401 ) (5,045 )
Financial income (expense) (711
) 337 (5,835 ) (999 )
Loss before
income taxes (34,210 ) (5,543 ) (260,236 ) (6,044 )
Income tax benefit (11,066 ) (5,370 ) (20,688
) (9,958 )
Net income (loss) (23,144 ) (173 )
(239,548 ) 3,914 Net loss attributable to non-controlling
interest (213 ) - (329 ) -
Net income (loss) attributable to Stratasys Ltd. $
(22,931 ) $ (173 ) $ (239,219 ) $ 3,914
Net income
(loss) per ordinary share attributable to Stratasys Ltd. Basic
$ (0.48 ) $ (0.00 ) $ (4.71 ) $ 0.08 Diluted (0.55 ) (0.00 ) (4.77
) 0.08
Weighted average ordinary shares outstanding
Basic 51,405 49,373 51,181 49,323 Diluted 51,870 49,373 51,413
51,238
Stratasys Ltd. Reconciliation
of GAAP to Non-GAAP Results of Operations (in thousands,
except per share data)
Three Months Ended
June 30, 2015 Three Months Ended June 30, 2014
GAAP Non-GAAP GAAP Non-GAAP
(unaudited) Adjustments*
(unaudited) (unaudited)
Adjustments* (unaudited) Net
sales Products $ 134,490 $ - $ 134,490 $ 154,090 $ - $ 154,090
Services 47,832 - 47,832
24,375 - 24,375 182,322 -
182,322 178,465 - 178,465
Cost of sales Products
67,666 (15,975 ) 51,691 73,394 (14,739 ) 58,655 Services
31,748 (841 ) 30,907 13,437
(340 ) 13,097 99,414 (16,816 ) 82,598 86,831
(15,079 ) 71,752
Gross
profit 82,908 16,816 99,724 91,634 15,079 106,713
Operating expenses Research and development, net 25,506
(3,016 ) 22,490 18,957 (1,318 ) 17,639 Selling, general and
administrative 97,581 (24,020 ) 73,561 77,929 (17,617 ) 60,312
Change in the fair value of obligations in connection with
acquisitions (6,680 ) 6,680 -
628 (628 ) - 116,407 (20,356 ) 96,051
97,514 (19,563 ) 77,951
Operating income (loss) (33,499 ) 37,172 3,673 (5,880 )
34,642 28,762
Financial income (expense) (711 ) -
(711 ) 337 - 337
Income (loss) before income taxes (34,210 ) 37,172 2,962
(5,543 ) 34,642 29,099 Income taxes (benefit) (11,066
) 6,279 (4,787 ) (5,370 ) 6,475
1,105
Net income (loss) (23,144 )
30,893 7,749 (173 ) 28,167 27,994 Net loss attributable to
non-controlling interest (213 ) - (213
) - - - Net income (loss)
attributable to Stratasys Ltd. $ (22,931 ) $ 30,893 $ 7,962
$ (173 ) $ 28,167 $ 27,994
Net income
(loss) per ordinary share attributable to Stratasys Ltd. Basic
$ (0.48 ) $ 0.15 $ (0.00 ) $ 0.57 Diluted (0.55 ) 0.15 (0.00 ) 0.55
Weighted average ordinary shares outstanding Basic
51,405 51,405 49,373 49,373 Diluted 51,870 52,705 49,373 51,196
The Company considers these non-GAAP
measures to be indicative of its core operating results and
facilitates a comparison of operating results across reporting
periods. The Company uses these non-GAAP measures when evaluating
its financial results as well as for internal planning and
forecasting purposes, however these measures should not be viewed
as a substitute for the Company’s GAAP results.
* Refer to the "Reconciliation of Non-GAAP
Adjustments" herein for further information regarding
adjustments.
Stratasys Ltd. Reconciliation of
GAAP to Non-GAAP Results of Operations (in thousands,
except per share data)
Six Months Ended June
30, 2015 Six Months Ended June 30, 2014
GAAP Adjustments*
Non-GAAP GAAP Adjustments*
Non-GAAP Net sales Products $ 261,157 $
- $ 261,157 $ 283,342 $ 235 $ 283,577 Services 93,896
- 93,896 46,064 -
46,064 355,053 - 355,053 329,406 235 329,641
Cost of sales Products 166,037 (61,887 ) 104,150
134,416 (28,468 ) 105,948 Services 60,020
(2,250 ) 57,770 25,628 (774 )
24,854 226,057 (64,137 ) 161,920 160,044 (29,242 )
130,802
Gross
profit 128,996 64,137 193,133 169,362 29,477 198,839
Operating expenses Research and development, net 52,744
(5,833 ) 46,911 35,728 (2,813 ) 32,915 Selling, general and
administrative 200,189 (56,864 ) 143,325 145,546 (31,140 ) 114,406
Goodwill impairment 150,400 (150,400 ) - - - - Change in the fair
value of obligations in connection with acquisitions (19,936
) 19,936 - (6,867 ) 6,867
- 383,397 (193,161 ) 190,236 174,407 (27,086 )
147,321
Operating
income (loss) (254,401 ) 257,298 2,897 (5,045 ) 56,563 51,518
Financial expense (5,835 ) - (5,835 ) (999 ) - (999 )
Income (loss) before
income taxes (260,236 ) 257,298 (2,938 ) (6,044 ) 56,563 50,519
Income taxes (benefit) (20,688 ) 8,093
(12,595 ) (9,958 ) 11,884 1,926
Net income (loss) (239,548 ) 249,205 9,657
3,914 44,679 48,593 Net loss attributable to non-controlling
interest (329 ) - (329 ) -
- - Net income (loss)
attributable to Stratasys Ltd. $ (239,219 ) $ 249,205 $
9,986 $ 3,914 $ 44,679 $ 48,593
Net income (loss) per ordinary share attributable to Stratasys
Ltd. Basic $ (4.71 ) $ 0.20 $ 0.08 $ 0.99 Diluted (4.77 ) 0.19
0.08 0.95
Weighted average ordinary shares
outstanding Basic 51,181 51,181 49,323 49,323 Diluted 51,413
52,524 51,238 51,221
The Company considers these non-GAAP
measures to be indicative of its core operating results and
facilitates a comparison of operating results across reporting
periods. The Company uses these non-GAAP measures when evaluating
its financial results as well as for internal planning and
forecasting purposes, however these measures should not be viewed
as a substitute for the Company’s GAAP results.
* Refer to the "Reconciliation of Non-GAAP
Adjustments" herein for further information regarding
adjustments.
Stratasys Ltd. Reconciliation of
Non-GAAP Adjustments (in thousands)
Three Months Ended June
30, Six Months Ended June 30, 2015 2014
2015 2014 Net sales, products Deferred revenue
step-up $ - $ - $ - $ 235
Cost of sales, products
Acquired intangible assets amortization (12,301 ) (14,029 ) (27,206
) (27,254 ) Other intangible assets impairment - - (29,782 ) -
Non-cash stock-based compensation expense (1,237 ) (710 ) (2,462 )
(1,214 ) Reorganization and other related costs (2,437 )
- (2,437 ) - (15,975 ) (14,739 )
(61,887 ) (28,468 )
Cost of sales, services Non-cash
stock-based compensation expense (560 ) (324 ) (1,168 ) (732 )
Reorganization and other related costs (75 ) - (75 ) - Merger and
acquisition related expense (206 ) (16 )
(1,007 ) (42 ) (841 ) (340 ) (2,250 ) (774 )
Research and
development, net Non-cash stock-based compensation expense
(1,506 ) (885 ) (3,374 ) (1,823 ) Reorganization and other related
costs (617 ) - (617 ) - Merger and acquisition related expense
(893 ) (433 ) (1,842 ) (990 ) (3,016 )
(1,318 ) (5,833 ) (2,813 )
Selling, general and
administrative Acquired intangible assets amortization (5,684 )
(5,507 ) (12,140 ) (10,871 ) Non-cash stock-based compensation
expense (6,261 ) (5,159 ) (12,320 ) (10,045 ) Merger and
acquisition related expense (5,937 ) (6,951 ) (12,842 ) (10,224 )
Reorganization and other related costs (6,138 ) - (6,139 ) -
Impairment charges - - (13,423 )
- (24,020 ) (17,617 ) (56,864 ) (31,140 )
Goodwill impairment - - (150,400 ) -
Change in the
fair value of obligations in connection with acquisitions
Change in the fair value of obligations in connection with
acquisitions 6,680 (628 ) 19,936 6,867
Income taxes
Tax expense related to non-GAAP adjustments 6,279 6,475 8,093
11,884
Net income $
30,893 $ 28,167 $ 249,205 $ 44,679
Stratasys Ltd. Reconciliation of
GAAP to Non-GAAP Forward Looking Guidance Three
Months Ended September 30, 2015 (in millions, except per
share data)
GAAP net loss ($27) to ($22.5)
Adjustments
Stock-based compensation expense $9.5 to $10 Intangible assets
amortization expense $18 Merger related expense $7 to $8 Tax
expense related to Non-GAAP adjustments ($6) to ($6.5)
Non-GAAP net income $1.5 to $7
GAAP loss per
share ($0.52) to ($0.43)
Non-GAAP diluted earnings
per share $0.03 to $0.13
View source
version on businesswire.com: http://www.businesswire.com/news/home/20150730005332/en/
Stratasys Ltd.Shane Glenn, 952-294-3416VP Investor
Relationsshane.glenn@stratasys.com
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