First Quarter Revenue of $132.9 million
First Quarter GAAP net loss of $21.7 million,
or ($0.40) per diluted share, and non-GAAP net loss of $10.6
million, or ($0.19) per diluted share
Generated $11.3 million of cash from operations
- $325.5 million net cash position with no debt
Company withdrawing full year 2020 guidance due
to economic uncertainty caused by COVID-19
Stratasys Ltd. (NASDAQ: SSYS) announced financial results for
the first quarter of 2020.
Q1 2020 Financial Results Summary:
Revenue for the first quarter of 2020 was $132.9 million,
compared to $155.3 million for the same period last year. The 14.4%
reduction was driven primarily by the adverse impact of COVID-19 on
the company’s customers throughout the industries into which the
company sells its products and services.
- GAAP gross margin was 45.0% for the quarter, compared to 49.2%
for the same period last year.
- Non-GAAP gross margin was 48.4% for the quarter, compared to
52.0% for the same period last year.
- Gross margin decline is due primarily to the lower proportion
of hardware and consumables out of the total revenue mix due to the
COVID-19 crisis, not to discounting or material ASP reductions. The
company strongly believes that gross margins will return to their
recent levels as the economy recovers.
- GAAP operating loss for the quarter was $19.9 million, compared
to an operating loss of $3.3 million for the same period last
year.
- Non-GAAP operating loss for the quarter was $8.4 million,
compared to non-GAAP operating income of $6.8 million for the same
period last year.
- Non-GAAP EBITDA was ($4.0) million for the quarter, compared to
$15.8 million for the same period last year.
- GAAP net loss for the quarter was $21.7 million, or ($0.40) per
diluted share, compared to a net loss of $2.3 million, or ($0.04)
per diluted share, for the same period last year.
- Non-GAAP net loss for the quarter was $10.6 million, or ($0.19)
per diluted share, compared to net income of $5.7 million, or $0.10
per diluted share, for the same period last year.
- The Company generated $11.3 million of cash from operations
during the first quarter and ended the period with $325.5 million
in cash, cash equivalents and short-term deposits. The Company has
no debt.
“With over 30 years of experience leading the 3D Printing
industry that we helped found, Stratasys was well positioned to
mobilize what we believe is the largest additive manufacturing
network in the world, in order to assist in the fight against
COVID-19,” said Yoav Zeif, Chief Executive Officer of Stratasys.
“We leveraged our application expertise, our channel and partner
network and our corporate-wide resources to help get a variety of
printed parts to the global medical community. We are well-prepared
to manage the downturn with a strong balance sheet and focus on
cost control and cash generation. We have over $325 million in cash
and equivalents and no debt. Our engagement level with our
customers remains high and the demand for our systems is strong.
It’s clear that this crisis has helped generate significant
awareness that 3D printing is becoming essential for accelerating
and improving design, speeding up time to market and production,
and creating less dependent and more resilient global supply
chains, including localized digital inventory and distributed
manufacturing.”
COVID-19 Actions
In response to COVID-19, the company has taken decisive actions
to ensure employee safety, preserve liquidity, maintain business
continuity, mitigate costs and support the global healthcare
community to combat the pandemic. These temporary actions
include:
- Initiated travel restriction policies, instituted
work-from-home for most employees, implemented comprehensive safety
protocols for all offices.
- Instituted non-essential hiring freeze, effectively reduced all
employees to a 4-day work week, adjusted our cost base and
production plan.
- Continued to invest in our new product development that we
believe will be the foundation of growth for many years to
come.
- Worked with our global network of partners and customers to
facilitate the printing of hundreds of thousands of components such
as face shields, testing swabs and ventilator tubes to the global
medical community.
Financial Guidance:
The company is withdrawing its 2020 financial guidance for
revenue, GAAP and non-GAAP net income and EPS, non-GAAP operating
margins and capital expenditures due to the high level of economic
uncertainty and disruption caused by COVID-19.
Stratasys Ltd. Q1 2020 Conference Call Details
The Company plans to hold the conference call to discuss its
first quarter 2020 financial results on Thursday, May 14, 2020 at
8:30 a.m. (ET).
The investor conference call will be available via live webcast
on the Stratasys Website at investors.stratasys.com; or directly at
the following web address:
https://78449.themediaframe.com/dataconf/productusers/ssys/mediaframe/36448/indexl.html
To participate by telephone, the U.S. toll-free number is
877-407-0619 and the international dial-in is +1-412-902-1012.
Investors are advised to dial into the call at least ten minutes
prior to the call to register. The webcast will be available for 6
months at investors.stratasys.com, or by accessing the
above-provided web address.
Stratasys (Nasdaq: SSYS) is a global leader in additive
manufacturing or 3D printing technology and is the manufacturer of
FDM®, PolyJet™, and stereolithography 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 more
than 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.
To learn more about Stratasys, visit www.stratasys.com, the
Stratasys blog, Twitter, LinkedIn, or Facebook. Stratasys reserves
the right to utilize any of the foregoing social media platforms,
including the company's websites, to share material, non-public
information pursuant to the SEC's Regulation FD. To the extent
necessary and mandated by applicable law, Stratasys will also
include such information in its public disclosure filings.
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 (or
withdrawal of guidance) concerning its expected results for 2020,
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 our success at introducing new or
improved products and solutions that gain market share; the degree
of growth of the 3D printing market generally; the duration of the
global COVID-19 pandemic, which, if extensive, may continue to
impact, in a material adverse manner, our operations, financial
position and cash flows, and those of our customers and suppliers;
the impact of potential shifts in the prices or margins of the
products that we sell or services that we provide, including due to
a shift towards lower-margin products or services; 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; to the extent of
our success at successfully consummating acquisitions or
investments in new businesses, technologies, products or services;
potential changes in our management and board of directors; global
market, political and economic conditions, and in the countries in
which we operate in particular (including risks related to the
impact of coronavirus on our operations, supply chain, liquidity,
cash flow and customer orders; costs and potential liability
relating to litigation and regulatory proceedings; risks related to
infringement of our intellectual property rights by others or
infringement of others' intellectual property rights by us; the
extent of our success at maintaining our liquidity and financing
our operations and capital needs; the impact of tax regulations on
our results of operations and financial condition; 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, 2019
(the “2019 Annual Report”), which we filed with the
Securities and Exchange Commission (the “SEC”) on February
26, 2020. Readers are urged to carefully review and consider the
various disclosures made throughout our 2019 Annual Report and the
Report of Foreign Private Issuer on Form 6-K that attaches
Stratasys’ unaudited, condensed consolidated financial statements
and its review of its results of operations and financial
condition, for the quarterly period ended March 31, 2020, which we
are furnishing 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 on an ongoing basis after (i)
excluding mergers, acquisitions and divestments related expense or
gains and reorganization-related charges or gains, and (ii)
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,
2020
2019
ASSETS Current assets Cash and cash
equivalents
$
297,177
$
293,484
Short-term deposits
$
28,300
$
28,300
Accounts receivable, net
115,093
132,558
Inventories
172,511
168,504
Prepaid expenses
7,327
6,567
Other current assets
25,424
29,659
Total current assets
645,832
659,072
Non-current assets Property, plant and equipment, net
191,534
189,706
Goodwill
385,409
385,658
Other intangible assets, net
81,523
87,328
Operating lease right-of-use assets
19,887
20,936
Other non-current assets
35,259
38,819
Total non-current assets
713,612
722,447
Total assets
$
1,359,444
$
1,381,519
LIABILITIES AND EQUITY Current
liabilities Accounts payable
$
34,189
$
35,818
Accrued expenses and other current liabilities
33,750
28,528
Accrued compensation and related benefits
36,600
34,013
Deferred revenues
51,353
52,268
Operating lease liabilities - short term
9,254
9,292
Total current liabilities
165,146
159,919
Non-current liabilities Deferred revenues - long-term
14,463
16,039
Operating lease liabilities - long term
11,057
12,445
Other non-current liabilities
28,988
35,343
Total non-current liabilities
54,508
63,827
Total liabilities
219,654
223,746
Redeemable non-controlling interests
537
622
Equity Ordinary shares, NIS 0.01 nominal value,
authorized 180,000 thousands shares; 54,799 thousands shares and
54,441 thousands shares issued and outstanding at March 31, 2020
and December 31, 2019, respectively
151
150
Additional paid-in capital
2,711,828
2,706,892
Accumulated other comprehensive loss
(8,848
)
(7,716
)
Accumulated deficit
(1,563,878
)
(1,542,175
)
Total equity
1,139,253
1,157,151
Total liabilities and equity
$
1,359,444
$
1,381,519
Stratasys Ltd. Consolidated Statements of
Operations (in thousands, except per share data)
Three Months Ended March
31,
2020
2019
(unaudited)
(unaudited)
Net sales Products
$
83,172
$
105,091
Services
49,735
50,209
132,907
155,300
Cost of sales Products
39,248
44,169
Services
33,789
34,674
73,037
78,843
Gross profit
59,870
76,457
Operating expenses Research and development, net
24,194
22,574
Selling, general and administrative
55,576
57,154
79,770
79,728
Operating loss
(19,900
)
(3,271
)
Financial income (expense), net
(829
)
753
Loss before income taxes
(20,729
)
(2,518
)
Income tax expenses
221
1,218
Share in profits (losses) of associated companies
(838
)
1,423
Net loss
(21,788
)
(2,313
)
Net loss attributable to non-controlling interests
(85
)
(43
)
Net loss attributable to Stratasys Ltd.
$
(21,703
)
$
(2,270
)
Net loss per ordinary share attributable to Stratasys
Ltd. Basic
$
(0.40
)
$
(0.04
)
Diluted
$
(0.40
)
(0.04
)
Basic
54,544
53,966
Diluted
54,544
53,966
Three Months Ended March 31,
2020
Non-GAAP
2020
2019
Non-GAAP
2019
GAAP
Adjustments
Non-GAAP
GAAP
Adjustments
Non-GAAP
U.S. dollars and shares in thousands (except per share
amounts) Gross profit (1)
$
59,870
$
4,414
$
64,284
$
76,457
$
4,252
$
80,709
Operating income (loss) (1,2)
$
(19,900
)
$
11,491
$
(8,409
)
$
(3,271
)
$
10,075
$
6,804
Net income (loss) attributable toStratasys Ltd. (1,2,3)
$
(21,703
)
$
11,137
$
(10,566
)
$
(2,270
)
$
7,927
$
5,657
Net income (loss) per diluted share attributableto Stratasys Ltd.
(4)
$
(0.40
)
$
0.21
$
(0.19
)
$
(0.04
)
$
0.14
$
0.10
(1)
Acquired intangible assets amortization expense
4,065
3,898
Non-cash stock-based compensation expense
402
354
Reorganization and other related costs
(53
)
-
4,414
4,252
(2)
Acquired intangible assets amortization expense
2,142
1,889
Non-cash stock-based compensation expense
4,503
3,875
Reorganization and other related costs
31
59
Merger and acquisition and other expense
401
-
7,077
5,823
11,491
10,075
(3)
Corresponding tax effect
(431
)
(544
)
Gain from equity method divestment, related writes-offs and
amortization
77
(1,604
)
11,137
7,927
(4)
Weighted average number of ordinaryshares outstanding- Diluted
54,544
54,544
53,966
54,477
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200514005321/en/
Stratasys Investor Relations Yonah Lloyd Vice President -
Investor Relations Yonah.Lloyd@stratasys.com
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