UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 6-K

 

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of July 2020

Commission File Number: 001-36515

 

 

Materialise NV

 

 

Technologielaan 15

3001 Leuven

Belgium

(Address of principal executive office)

 

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F  ☒              Form 40-F  ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):  ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):  ☐

This Form 6-K is incorporated by reference into the registrant’s Registration Statement on Form F-3 (File No. 333-213649).

 

 

 


Second Quarter 2020 Results

Except as otherwise required by the context, references to “Materialise,” “Company,” “we,” “us” and “our” are to Materialise NV and its subsidiaries.

Second Quarter 2020 Results

Total revenue for the second quarter of 2020 decreased 21.3% to 38,117 kEUR compared to 48,404 kEUR for the second quarter of 2019.

Revenue from our Materialise Software segment increased 2.4% to 9,540 kEUR for the second quarter of 2020 from 9,320 kEUR for the same quarter last year.

Revenue from our Materialise Medical segment decreased 19.3% to 11,735 kEUR for the second quarter of 2020 compared to 14,546 kEUR for the same period in 2019. Compared to the second quarter of 2019, revenues from our medical software grew 6.7% and revenues from medical devices and services decreased 31.8%.

Revenue from our Materialise Manufacturing segment decreased 31.7% to 16,777 kEUR for the second quarter of 2020 from 24,550 kEUR for the second quarter of 2019.

Gross profit was 19,986 kEUR, or 52.4% of total revenue, for the second quarter of 2020 compared to 26,527 kEUR, or 54.8% of total revenue, for the second quarter of 2019.

Research and development (“R&D”), sales and marketing (“S&M”) and general and administrative (“G&A”) expenses decreased, in the aggregate, 18.5% to 22,705 kEUR for the second quarter of 2020 from 27,861 kEUR for the second quarter of 2019. Specific cost reduction initiatives in S&M and G&A resulted in decreases compared to the second quarter of 2019 of 22.9% and 24.3% respectively, while R&D expenses decreased only 0.9%.

Net other operating income was 892 kEUR compared to 1,370 kEUR for the second quarter of 2019.

Operating result decreased to (1,827) kEUR from 36 kEUR for the second quarter of 2019.

Net financial result was (295) kEUR compared to (190) kEUR for the second quarter of 2019. The share in result of joint venture amounted to 0 kEUR compared to (82) kEUR for the same period in 2019.

The second quarter of 2020 contained income tax income of 191 kEUR, compared to an income tax expense of (61) kEUR in the second quarter of 2019.

As a result of the above, net loss for the second quarter of 2020 was (1,932) kEUR, compared to (297) kEUR for the same period in 2019. Total comprehensive loss for the second quarter of 2020, which includes exchange differences on translation of foreign operations, was (2,977) kEUR compared to (727) kEUR for the 2019 period.

Adjusted EBITDA decreased to 3,382 kEUR from 5,059 kEUR. The Adjusted EBITDA margin (Adjusted EBITDA divided by total revenue) for the second quarter of 2020 was 8.9% compared to 10.5% for the second quarter of 2019.

Segment EBITDA from our Materialise Software segment increased to 3,756 kEUR from 2,055 kEUR while the segment EBITDA margin (segment EBITDA divided by segment revenue) was 39.4% compared to 22.1% for the prior-year period.

Segment EBITDA from our Materialise Medical segment decreased to 1,139 kEUR compared to 2,738 kEUR while the segment EBITDA margin was 9.7% compared to 18.8% for the second quarter of 2019.

Segment EBITDA from our Materialise Manufacturing segment decreased to 650 kEUR from 2,835 kEUR while the segment EBITDA margin was 3.9% compared to 11.5% for the second quarter of 2019.

At June 30, 2020, we had cash and equivalents of 125,454 kEUR compared to 128,897 kEUR at December 31, 2019. Gross debt amounted to 121,549 kEUR, compared to 127,939 kEUR at December 31, 2019. As a result, our net cash position increased 2,947 kEUR during the first half year of 2020.


Cash flow from operating activities for the second quarter of 2020 was 7,053 kEUR compared to 4,760 kEUR for the same period in 2019. Total capital expenditures for the second quarter of 2020 amounted to 3,398 kEUR.

Net shareholders’ equity at June 30, 2020 was 132,847 kEUR compared to 142,675 kEUR at December 31, 2019.

Non-IFRS Measures

Materialise uses EBITDA and Adjusted EBITDA as supplemental financial measures of its financial performance. EBITDA is calculated as net profit plus income taxes, financial expenses (less financial income), shares of loss in a joint venture and depreciation and amortization. Adjusted EBITDA is determined by adding non-cash stock-based compensation expenses and acquisition-related expenses of business combinations to EBITDA. Management believes these non-IFRS measures to be important measures as they exclude the effects of items which primarily reflect the impact of long-term investment and financing decisions, rather than the performance of the Company’s day-to-day operations. As compared to net profit, these measures are limited in that they do not reflect the periodic costs of certain capitalized tangible and intangible assets used in generating revenues in the Company’s business, or the charges associated with impairments. Management evaluates such items through other financial measures such as capital expenditures and cash flow provided by operating activities. The Company believes that these measurements are useful to measure a company’s ability to grow or as a valuation measurement. The Company’s calculation of EBITDA and Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies. EBITDA and Adjusted EBITDA should not be considered as alternatives to net profit or any other performance measure derived in accordance with IFRS. The Company’s presentation of EBITDA and Adjusted EBITDA should not be construed to imply that its future results will be unaffected by unusual or non-recurring items.

Exchange Rate

This document contains translations of certain euro amounts into U.S. dollars at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from euros to U.S. dollars in this document were made at a rate of EUR 1.00 to USD 1.1198, the reference rate of the European Central Bank on June 30, 2020.

About Materialise

Materialise incorporates 30 years of 3D printing experience into a range of software solutions and 3D printing services, which form the backbone of the 3D printing industry. Materialise’s open and flexible solutions enable players in a wide variety of industries, including healthcare, automotive, aerospace, art and design, and consumer goods, to build innovative 3D printing applications that aim to make the world a better and healthier place. Headquartered in Belgium, with branches worldwide, Materialise combines one of the largest groups of software developers in the industry with one of the largest 3D printing facilities in the world.


Consolidated income statements (Unaudited)

 

     For the three months ended
June 30,
    For the six
months ended
June 30,
 
In 000    2020     2020     2019     2020     2019  
     U.S.$                  

Revenue

     42,684       38,117       48,404       84,362       95,519  

Cost of sales

     (20,303     (18,131     (21,877     (39,744     (43,413

Gross profit

     22,380       19,986       26,527       44,618       52,106  

Gross profit as % of revenue

     52,4     52.4     54,8     52,9     54,6

Research and development expenses

     (6,769     (6,045     (6,100     (12,572     (11,786

Sales and marketing expenses

     (11,379     (10,161     (13,173     (22,789     (25,252

General and administrative expenses

     (7,277     (6,499     (8,588     (13,696     (16,184

Net other operating income (expenses)

     999       892       1,370       1,575       2,627  

Operating (loss) profit

     (2.046     (1,827     36       (2,864     1,511  

Financial expenses

     (717     (640     (313     (2,461     (1,509

Financial income

     386       345       123       845       728  

Share in loss of joint venture

         (82     (39     (205

(Loss) profit before taxes

     (2,377     (2,123     (236     (4,519     524  

Income taxes

     214       191       (61     (267     (1,126

Net (loss) profit for the period

     (2,163     (1,932     (297     (4,786     (601

Net (loss) profit attributable to:

          

The owners of the parent

     (2,098     (1,874     (297     (4,681     (601

Non-controlling interest

     (65     (58     —         (104     —    

Earnings per share attributable to owners of the parent

 

       

Basic

     (0.04     (0.04     (0.01     (0.09     (0.01

Diluted

     (0.04     (0.04     (0.01     (0.09     (0.01

Weighted average basic shares outstanding

     53,194       53,194       52,891       53,194       52,891  

Weighted average diluted shares outstanding

     53,194       53,194       52,891       53,194       52,891  


Consolidated statements of comprehensive income (Unaudited)

 

     For the three months ended
June 30,
    For the six
months ended
June 30,
 
In 000    2020     2020     2019     2020     2019  
     U.S.$                  

Net profit (loss) for the period

     (2,163     (1,932     (297     (4,786     (602

Other comprehensive income

          

Exchange difference on translation of foreign operations

     (1,170     (1,045     (430     (6,787     157  

Other comprehensive income (loss), net of taxes

     (1,170     (1,045     (430     (6,787     157  

Total comprehensive income (loss) for the year, net of taxes

     (3.333     (2,977     (727     (11.573     (445

Total comprehensive income (loss) attributable to:

          

The owners of the parent

     (3,074     (2,745     (727     (10,470     (445

Non-controlling interest

     (260     (232     —         (1,103     —    


Consolidated statement of financial position (Unaudited)

 

     As of
June 30,
     As of
December 31,
 
In 000    2020      2019  
           

Assets

     

Non-current assets

     

Goodwill

     19,222        20,174  

Intangible assets

     24,964        27,395  

Property, plant & equipment

     88,683        90,331  

Right-of-Use assets

     9,883        10,586  

Investments in joint ventures

     —          39  

Deferred tax assets

     234        192  

Other non-current assets

     10,244        9,391  

Total non-current assets

     153,410        158,108  

Current assets

     

Inventories

     11,682        12,696  

Trade receivables

     30,253        40,322  

Other current assets

     9,631        9,271  

Cash and cash equivalents

     125,454        128,897  

Total current assets

     177,021        191,186  

Total assets

     330,431        349,294  


     As of
June 30,
    As of
December 31,
 
In 000    2020     2019  
          

Equity and liabilities

    

Equity

    

Share capital

     3,068       3,066  

Share premium

     138,229       138,090  

Consolidated reserves

     (4,876     (195

Other comprehensive income

     (5,789     (1.394

Equity attributable to the owners of the parent

     130,632       139,567  

Non-controlling interest

     2,216       3,107  

Total equity

     132,847       142,675  

Non-current liabilities

    

Loans & borrowings

     97,590       104,673  

Lease liabilities

     6,132       6,427  

Deferred tax liabilities

     5,687       5,747  

Deferred income

     4,970       5,031  

Other non-current liabilities

     671       696  

Total non-current liabilities

     115,051       122,575  

Current liabilities

    

Loans & borrowings

     14,331       13,389  

Lease liabilities

     3,496       3,449  

Trade payables

     15,641       18,516  

Tax payables

     2,560       3,363  

Deferred income

     28,157       27,641  

Other current liabilities

     18,348       17,686  

Total current liabilities

     82,533       84,044  

Total equity and liabilities

     330,431       349,294  


Consolidated statement of cash flows (Unaudited)

 

     For the six months ended June 30,  
in 000    2020     2019  
          

Operating activities

    

Net (loss) profit for the period

     (4,786     (602

Non-cash and operational adjustments

    

Depreciation of property, plant & equipment

     7,410       6,950  

Amortization of intangible assets

     2,284       2,229  

Share-based payment expense

     0       197  

Loss (gain) on disposal of property, plant & equipment

     46       134  

Movement in provisions

     4       20  

Movement reserve for bad debt

     181       (116

Financial income

     (845     (171

Financial expense

     2,453       1,232  

Impact of foreign currencies

     0       (288

Share in loss of a joint venture (equity method)

     39       205  

(Deferred) income taxes

     266       1,126  

Other

     36       (196

Working capital adjustment & income tax paid

    

Decrease (increase) in trade receivables and other receivables

     8,962       (4,466

Decrease (increase) in inventories

     1,220       (43

Increase (decrease) in trade payables and other payables

     (1,843     3,737  

Income tax paid

     (1,102     (1,108

Net cash flow from operating activities

     14,326       8,840  


     For the six months ended June 30,  
in 000    2020     2019  
          

Investing activities

    

Purchase of property, plant & equipment

     (5,756     (4,827

Purchase of intangible assets

     (687     (1,457

Proceeds from the sale of property, plant & equipment & intangible assets (net)

     72       (3

Convertible loan to third party

     (300     (2,500

Investments in joint-ventures

     —         —    

Interest received

     —         —    

Net cash flow used in investing activities

     (6,671     (8,787

Financing activities

    

Proceeds from loans & borrowings

     15       3,000  

Repayment of loans & borrowings

     (5,813     (5,818

Repayment of finance leases

     (1,823     (2,765

Capital increase

     140       —    

Interest paid

     (1,178     (934

Other financial income (expense)

     (617     (292

Net cash flow from (used in) financing activities

     (9,276     (6,809

Net increase of cash & cash equivalents

     (1,621     (6,756

Cash & cash equivalents at beginning of the year

     128,897       115,506  

Exchange rate differences on cash & cash equivalents

     (1.822     115  

Cash & cash equivalents at end of the year

     125,454       108,865  


Reconciliation of Net Profit (Loss) to EBITDA and Adjusted EBITDA (Unaudited)

 

     For the three months
ended June 30,
    For the six months
ended June 30,
 
In 000    2020     2019     2020     2019  
                  

Net profit (loss) for the period

     (1,932     (297     (4,786     (601

Income taxes

     (191     61       266       1,126  

Financial expenses

     640       313       2,461       1,509  

Financial income

     (345     (123     (845     (728

Share in loss of joint venture

       82       39       205  

Depreciation and amortization

     4,979       4,649       9,694       9,178  

EBITDA

     3,152       4,685       6,829       10,691  

Non-cash stock-based compensation expense (1)

     (231     (374     (156     (196

Acquisition-related expenses business combinations

     —         —         —         —    

ADJUSTED EBITDA

     3,382       5,059       6,985       10,888  

 

(1)

Non-cash stock-based compensation expenses represent the cost of equity-settled and cash-settled share-based payments to employees.


Segment P&L (Unaudited)

 

In 000    Materialise
Software
    Materialise
Medical
    Materialise
Manufacturing
    Total
segments
    Unallocated
(1)(2)
    Consoli-
dated
 
                          

For the three months ended June 30, 2020

            

Revenues

     9,540       11,735       16,777       38,052       29       38,117  

Segment (adj) EBITDA

     3,756       1,139       650       5,546       (2,164     3,382  

Segment (adj) EBITDA %

     39.4     9.7     3.9     11.6    

For the three months ended June 30, 2019

            

Revenues

     9,320       14,546       24,550       48,415       (11     48,404  

Segment (adj) EBITDA

     2,055       2,738       2,835       7,629       (2,570     5,059  

Segment (adj) EBITDA %

     22.1     18.8     11.5     15.8    

 

In 000    Materialise
Software
    Materialise
Medical
    Materialise
Manufacturing
    Total
segments
    Unallocated
(1)(2)
    Consoli-
dated
 
                          

For the six months ended June 30, 2020

            

Revenues

     19,361       27,380       37,592       84,333       29       84,362  

Segment (adj) EBITDA

     6,401       3,595       1,768       11,765       (4,779     6,985  

Segment (adj) EBITDA %

     33.1     13.1     4.7     14.0    

For the six months ended June 30, 2019

            

Revenues

     18,670       28,112       48,734       95,515       4       95,519  

Segment (adj) EBITDA

     5,016       4,511       6,530       16,058       (5,170     10,888  

Segment (adj) EBITDA %

     26.9     16.0     13.4     16.8    

 

(1)

Unallocated Revenues consist of occasional one-off sales in our core competencies not allocated to any of our segments.

(2)

Unallocated Segment EBITDA consists of corporate research and development, corporate headquarter costs and other operating income (expense) and the added non-cash share-based compensation expenses that acquisition expenses of business combinations that are included in Adjusted EBITDA.


Reconciliation of Net Profit (Loss) to Segment EBITDA (Unaudited)

 

     For the three months
ended June 30,
    For the six months
ended June 30,
 
In 000    2020     2019     2020     2019  
                  

Net profit (loss) for the period

     (1,932     (297     (4,786     (601

Income taxes

     (191     61       266       1,126  

Financial cost

     640       313       2,461       1,509  

Financial income

     (345     (123     (845     (728

Share in loss of joint venture

       82       39       205  

Operating profit

     (1,827     36       (2,864     1,511  

Depreciation and amortization

     4,979       4,649       9,694       9,178  

Corporate research and development

     687       502       1,478       1,014  

Corporate headquarter costs

     2,781       3,108       5,173       5,777  

Other operating income (expense)

     (1.074     (501     (1,716     (1,107

Segment EBITDA

     5,546       7,629       11,765       16,058  


SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

MATERIALISE NV
By:  

/s/ Wilfried Vancraen

Name:   Wilfried Vancraen
Title:   Chief Executive Officer

Date: July 30, 2020

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