First Quarter Revenue of $155.3 million
First Quarter GAAP net loss of $2.3 million, or
($0.04) per diluted share, and non-GAAP net income of $5.7 million,
or $0.10 per diluted share
Stratasys Ltd. (NASDAQ: SSYS) announced financial results for
the first quarter of 2019.
Q1 2019 Financial Results Summary:Revenue for the first
quarter of 2019 was $155.3 million, compared to $153.8 million for
the same period last year.
- GAAP gross margin was 49.2% for the
quarter, unchanged from the same period last year.
- Non-GAAP gross margin was 52.0% for the
quarter, compared to 52.8% for the same period last year.
- GAAP operating loss for the quarter was
$3.3 million, compared to operating loss of $6.5 million for the
same period last year.
- Non-GAAP operating income for the
quarter was $6.8 million, compared to non-GAAP operating income of
$4.9 million for the same period last year.
- GAAP net loss for the quarter was $2.3
million, or ($0.04) per diluted share, compared to a net loss of
$13.0 million, or ($0.24) per diluted share, for the same period
last year.
- Non-GAAP net income for the quarter was
$5.7 million, or $0.10 per diluted share, compared to non-GAAP net
income of $2.7 million, or $0.05 per diluted share, reported for
the same period last year.
- The Company generated $4.6 million of
cash from operations during the first quarter and ended the period
with $367.8 million of cash and cash equivalents.
“We are pleased with our first quarter top-line results, and are
particularly encouraged by the continuation of the strong
performance we have seen in North America over the last several
quarters, demonstrating steady adoption of our systems and
materials in our largest market,” said Elchanan (Elan) Jaglom,
Interim Chief Executive Officer of Stratasys. “We are also pleased
with our non-GAAP profitability in the first quarter, demonstrating
our continued commitment to controlling expenses and delivering
shareholder value. Our recent new product introductions are
generating significant interest from our customers and expanding
our addressable markets, and we look forward to additional
announcements as we move through 2019 and into 2020.”
Recent Product AnnouncementsAt the recent Additive
Manufacturing User Group conference, the Company made the following
announcements of new products and features that it believes will
expand its addressable markets and strengthen its leadership in
rapid prototyping, manufacturing, and high-realism multi-color,
multi-material 3D printing.
- F120 3D Printer – an industrial-grade
system targeting customers new to additive manufacturing. Offering
the benefits of the Stratasys F123 platform at an affordable price
with reliable, accurate, and repeatable 3D printing, it is
specifically designed for designers, engineers and educators.
- V650 Flex Stereolithography 3D Printer
– Stratasys’ first commercially-available entry into the
stereolithography marketplace, combining the power of a large-scale
system with an open, configurable environment and fine-tuning
across a broad range of available resins.
- Stratasys J750 and J735 Printers are
now the first and only 3D printing systems with technology
officially recognized as “Pantone-Validated” – allowing for
synchronized color communication between designers, modelers and
manufacturers.
Financial Guidance:Stratasys today reiterated the
following information regarding the Company’s guidance for
projected revenue and net income for the fiscal year ending
December 31, 2019:
- Revenue guidance of $670 to $700
million.
- GAAP net loss of $22 to $12 million, or
($0.40) to ($0.22) per diluted share.
- Non-GAAP net income of $30 to $38
million, or $0.55 to $0.70 per diluted share.
Stratasys also reiterated the following guidance regarding the
Company’s projected performance and strategic plans for 2019:
- Non-GAAP operating margins of 5.5% to
6.5%.
- Capital expenditures are projected at
$45 to $60 million.
Given the expected ongoing negative impact of not recording a
tax benefit on U.S. tax losses on the Company’s non-GAAP net
income, the Company believes that the rate of growth in its
non-GAAP operating income is the best measure of its
performance.
Non-GAAP earnings guidance excludes $32 million of projected
amortization of intangible assets; $20 to $22 million of
share-based compensation expense; reorganization related and other
expense of $1 to $2 million; and includes tax adjustments of ($3)
to ($4) million on the above non-GAAP items.
Stratasys Ltd. Q1 2019 Conference Call Details
The Company plans to hold the conference call to discuss its
first quarter financial results on Thursday, May 2, 2019 at 8:30
a.m. (ET).
The investor conference call will be available via live webcast
on the Stratasys Web site at investors.stratasys.com; or directly
at the following web address:
https://edge.media-server.com/m6/p/cwyibwsv.
To participate by telephone, the domestic dial-in number is
(866) 394-5776 and the international dial-in is (409) 350-3596. The
access code is 2949608.
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 "Investor Relations" page of the Stratasys Website or
by accessing the provided web address.
Stratasys is a global leader in additive manufacturing or
3D printing technology, and is the manufacturer of FDM® and
PolyJet™ 3D Printers. The Company’s technologies are used to create
prototypes, manufacturing tools, and production parts for
industries, including aerospace, automotive, healthcare, consumer
products and education. For 30 years, Stratasys products have
helped manufacturers reduce product-development time, cost, and
time-to-market, as well as reduce or eliminate tooling costs and
improve product quality. The Stratasys 3D printing ecosystem of
solutions and expertise includes: 3D printers, materials, software,
expert services, and on-demand parts production. Online
at: www.stratasys.com, http://blog.stratasys.com and
LinkedIn.
Stratasys is a registered trademark and the Stratasys signet is
a trademark of Stratasys Ltd. and/or its subsidiaries or
affiliates. All other trademarks are the property of their
respective owners.
Cautionary Statement Regarding Forward-Looking
Statements
The statements in this press release regarding Stratasys'
strategy, and the statements regarding its projected future
financial performance, including the financial guidance concerning
its expected results for 2019, are forward-looking statements
reflecting management's current expectations and beliefs. These
forward-looking statements are based on current information that
is, by its nature, subject to rapid and even abrupt change. Due to
risks and uncertainties associated with Stratasys' business, actual
results could differ materially from those projected or implied by
these forward-looking statements. These risks and uncertainties
include, but are not limited to: the degree of market acceptance of
our 3D printers, high-performance systems and consumables, and the
software and technology included in those systems; potential
declines in the demand for, or the prices of, our products and
services, or volume of our sales, due to decreased demand either
for them specifically or in the 3D printing market generally;
potential shifts in our product mix to lower-margin products or in
our revenues mix towards our AM services business; the impact of
competition and new technologies; potential further charges against
earnings that we could be required to take due to impairment of
additional goodwill or other intangible assets; potential failure
to successfully consummate acquisitions or investments in new
businesses, technologies, products or services; risks related to
our relationships with our suppliers, resellers and independent
sales agents, and our operations at our manufacturing sites; risks
related to the international scope of our operations and regulatory
compliance (including reporting, environmental, anti-corruption and
other regulatory compliance) related to that scope of operations;
risks related to the security of our information systems (including
risks related to potential cyber-attacks); changes in the overall
global economic environment or in political and economic conditions
in the countries in which we operate; changes in our strategy;
costs and potential liability relating to litigation and regulatory
proceedings; and those additional factors referred to in Item 3.D
“Key Information - Risk Factors”, Item 4, “Information on the
Company”, Item 5, “Operating and Financial Review and Prospects,”
and all other parts of our Annual Report on Form 20-F for the year
ended December 31, 2018 (the “2018 Annual Report”), filed
with the Securities and Exchange Commission (the “SEC”) on
March 7th, 2019. Readers are urged to carefully review and consider
the various disclosures made throughout our 2018 Annual Report and
the Report of Foreign Private Issuer on Form 6-K that attaches
Stratasys’ unaudited, condensed consolidated financial statements
as of, and for the quarter ended, March 31, 2019, and its review of
its results of operations and financial condition for that period,
which has been furnished to the SEC on or about the date hereof,
and our other reports filed with or furnished to the SEC, which are
designed to advise interested parties of the risks and factors that
may affect our business, financial condition, results of operations
and prospects. Any guidance provided, and other forward-looking
statements made, in this press release are made as of the date
hereof, and Stratasys 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.
Use of non-GAAP financial
measures
The non-GAAP data included herein, which excludes certain items
as described below, are non-GAAP financial measures. Our management
believes that these non-GAAP financial measures are useful
information for investors and shareholders of our Company in
gauging our results of operations (x) on an ongoing basis after
excluding mergers, acquisitions and divestments related expense or
gains and reorganization-related charges or gains, and (y)
excluding non-cash items such as stock-based compensation expenses,
acquired intangible assets amortization, including intangible
assets amortization related to equity method investments,
impairment of long-lived assets, and the corresponding tax effect
of those items. These non-GAAP adjustments either do not reflect
actual cash outlays that impact our liquidity and our financial
condition or have a non-recurring impact on the statement of
operations, as assessed by management. These non-GAAP financial
measures are presented to permit investors to more fully understand
how management assesses our performance for internal planning and
forecasting purposes. The limitations of using these non-GAAP
financial measures as performance measures are that they provide a
view of our results of operations without including all items
indicated above during a period, which may not provide a comparable
view of our performance to other companies in our industry.
Investors and other readers should consider non-GAAP measures only
as supplements to, not as substitutes for or as superior measures
to, the measures of financial performance prepared in accordance
with GAAP. Reconciliation between results on a GAAP and non-GAAP
basis is provided in a table below.
Stratasys Ltd.
Consolidated Balance Sheets (Unaudited) (in
thousands, except share data)
March 31, December 31, 2019 2018
ASSETS Current
assets Cash and cash equivalents $ 367,843 $ 393,167 Accounts
receivable, net 128,420 138,146 Inventories 131,731 123,524 Net
investment in sales-type leases 2,193 2,658 Prepaid expenses 7,750
6,398 Other current assets 21,023 20,278
Total current assets 658,960
684,171
Non-current assets Net investment in
sales-type leases - long term 965 1,552 Property, plant and
equipment, net 188,255 188,150 Goodwill 385,612 385,849 Other
intangible assets, net 101,486 107,274 Operating lease right-of-use
assets 27,408 - Other non-current assets 22,456
21,258 Total non-current assets 726,182
704,083
Total assets $ 1,385,142
$ 1,388,254
LIABILITIES AND EQUITY
Current liabilities Accounts payable $ 43,033 $
45,855 Current portion of long term-debt - 5,143 Accrued expenses
and other current liabilities 29,831 39,115 Accrued compensation
and related benefits 35,516 31,703 Deferred revenues 53,997 53,965
Operating lease liabilities - short term 9,439
- Total current liabilities 171,816
175,781
Non-current liabilities
Long-term debt - 22,000 Deferred tax liabilities 1,391 1,662
Deferred revenues - long-term 17,307 18,422 Operating lease
liabilities - long term 18,481 - Other non-current liabilities
28,474 27,422 Total non-current
liabilities 65,653 69,506
Total liabilities 237,469 245,287
Redeemable non-controlling interests 809 852
Equity
Ordinary shares, NIS 0.01 nominal value,
authorized 180,000 thousands shares; 54,048 thousands shares and
53,881 thousands shares issued and outstanding at March 31, 2019
and December 31, 2018, respectively
146 146 Additional paid-in capital 2,687,499 2,681,048 Accumulated
other comprehensive loss (7,185 ) (7,753 ) Accumulated deficit
(1,533,596 ) (1,531,326 ) Total equity 1,146,864
1,142,115
Total liabilities and equity $
1,385,142 $ 1,388,254
Stratasys Ltd. Consolidated Statements of
Operations (in thousands, except per share data)
Three Months Ended
March 31, 2019 2018 (unaudited)
(unaudited) Net sales Products $ 105,091 $
103,917 Services 50,209 49,916 155,300
153,833
Cost of sales Products 44,169 45,218 Services
34,674 32,965 78,843 78,183
Gross profit 76,457 75,650
Operating
expenses Research and development, net 22,574 25,110 Selling,
general and administrative 57,154 57,005
79,728 82,115
Operating loss (3,271 )
(6,465 )
Financial income, net 753 8
Loss before income taxes (2,518 ) (6,457 ) Income tax
expenses 1,218 601 Share in profits (losses) of associated
companies 1,423 (6,073 )
Net
loss (2,313 ) (13,131 ) Net loss attributable to
non-controlling interests (43 ) (90 ) Net loss attributable
to Stratasys Ltd. $ (2,270 ) $ (13,041 )
Net loss per
ordinary share attributable to Stratasys Ltd. Basic $ (0.04 ) $
(0.24 ) Diluted (0.04 ) (0.24 ) Basic 53,966 53,657
Diluted 53,966 53,657
Stratasys Ltd.
Reconciliation of GAAP to Non-GAAP
Results of Operations
Three Months Ended March 31, 2019 Non-GAAP
2019 2018 Non-GAAP 2018 GAAP
Adjustments Non-GAAP GAAP Adjustments
Non-GAAP U.S. dollars and shares in thousands (except per
share amounts) Gross profit (1) $ 76,457 $ 4,252 $
80,709 $ 75,650 $ 5,599 $ 81,249 Operating income (loss) (1,2)
(3,271 ) 10,075 6,804 (6,465 ) 11,387 4,922
Net income (loss) attributable to
Stratasys Ltd. (1,2,3)
(2,270 ) 7,927 5,657 (13,041 ) 15,763 2,722
Net income (loss) per diluted share
attributable to Stratasys Ltd. (4)
$ (0.04 ) $ 0.14 $ 0.10 $ (0.24 ) $ 0.29 $ 0.05
(1) Acquired intangible assets amortization expense 3,898
5,204 Non-cash stock-based compensation expense 354 387 Merger and
acquisition related expense - 8 4,252
5,599 (2) Acquired intangible assets amortization
expense 1,889 2,558 Non-cash stock-based compensation expense 3,875
3,028 Reorganization and other related costs 59 1,671 Gain from
sale of plant and property - (1,563 ) Merger and acquisition
related expense - 94 5,823
5,788 10,075 11,387
(3) Corresponding tax effect (544 ) (792 ) Gain from
equity method divestment, related write-offs and amortization
(1,604 ) 5,168 $ 7,927 $ 15,763
(4)
Weighted average number of ordinary shares
outstanding- Diluted
53,966 54,477 52,690 53,341
Stratasys Ltd.
Reconciliation of GAAP to Non-GAAP Forward Looking
Guidance Fiscal Year 2019 (in millions,
except per share data)
GAAP net loss
($22) to ($12)
Adjustments
Stock-based compensation expense $20 to $22 Intangible assets
amortization expense $32 Reorganization related expense $1 to $2
Tax expense (Income) related to Non-GAAP adjustments ($4) to ($3)
Non-GAAP net income $30 to $38
GAAP loss
per share ($0.40) to ($0.22)
Non-GAAP diluted
earnings per share $0.55 to $0.70
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version on businesswire.com: https://www.businesswire.com/news/home/20190502005194/en/
Stratasys Investor RelationsYonah LloydVice President -
Investor RelationsYonah.Lloyd@stratasys.com
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