Slide 1: Conference Call and Webcast
Conference Call and Webcast NASDAQ: TDSC www.3dsystems.com November 4, 2009
Slide 2: Participants
Participants q Amanda Molbert Coordinator, Investor Relations q Abe Reichental President & Chief Executive Officer q Damon Gregoire Vice President & Chief Financial Officer q Bob Grace Vice President & General Counsel
Slide 3: Welcome Webcast Viewers
Welcome Webcast Viewers q To listen to the conference via phone and to ask questions during our Q&A session, please dial: n 1-888-336-3485 in the United States n 1-706-634-0653 from outside the United States n Confirmation Code: 36028148
Slide 4: Forward-Looking Statements
Forward-Looking Statements Certain statements made in this presentation that are not statements of historical or current facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may involve known and unknown risks, un
Slide 5: Operating Results
Operating Results Abe Reichental President & CEO
Slide 6: Factors Shaping Third Quarter 2009 Results
Q3-09 vs. Q2-09 Revenue Growth U.S. Europe AP Total Systems (10.9)% 2.3% 198.9% 16.0% Materials 5.5% 10.3% 43.1% 12.1% Service 25.1% (12.5%) 36.3% 8.4% Total 6.6% 1.7% 80.4% 12.0% q Sequential revenue growth from all revenue buckets. q Systems revenue increased by $0.9 million. q Materials sales gre
Slide 7: Factors Shaping Third Quarter 2009 Results (continued)
Q3-08 Q4-08 Q1-09 Q2-09 Q3-09 Total Operating Expenses $14.3 $13.9 $12.1 $11.7 $11.2 Gross Profit Margin 39% 44% 44% 44% 45% Cash $18.1 $22.2 $23.4 $24.0 $24.0 Inventory $23.9 $21.0 $19.9 $19.1 $20.3 q Gross profit margin and operating expenses both improved compared to the third quarter of 2008, wh
Slide 8: isident & CFO
isident & CFO federining High Definition
Slide 9: Third Quarter 2009 Operating Results
Operating Results Third Quarter % Change 2009 2008 Favorable (Unfavorable) Revenue $27.7 $35.6 (22%) Gross Profit $12.3 $14.0 (12%) % of Revenue 45% 39% Operating Expenses $11.2 $14.3 22% % of Revenue 41% 40% Net Income (Loss) $0.9 ($1.0) 191% Depreciation & Amortization $1.3 $1.8 28% % of Revenue 5
Slide 10: Nine Months 2009 Operating Results
Operating Results Nine Months % Change 2009 2008 Favorable (Unfavorable) Revenue $76.4 $104.0 (27%) Gross Profit $33.6 $40.3 (17%) % of Revenue 44% 39% Operating Expenses $35.0 $47.1 26% % of Revenue 46% 45% Net Loss ($2.5) ($8.0) 69% Depreciation & Amortization $4.3 $5.0 12% % of Revenue 6% 5% Full
Slide 11: Q3 2009 Revenue Mix By Category and Region
Q3 2009 Revenue Mix By Category and Region Asia Pacific Europe North America 28% $27.7 40% 45% 15% $35.6 44% 40% 16% $27.7 $35.6 25% 29% 25% 47% 46%
Slide 12: Service Revenue Trends
Service Revenue Trends 60% 50% 40% 30% 20% 10% 0%
Slide 13: Third Quarter 2009 Gross Profit and Margin
Third Quarter 2009 Gross Profit and Margin q Items favorably affecting gross profit margin: n Supply chain efficiencies and cost reduction measures n Reduction in field service costs n Reduction in manufacturing costs as a result of our change in manufacturing strategy q Items negatively impacting g
Slide 14: Nine Months 2009 Gross Profit and Margin
Nine Months 2009 Gross Profit and Margin q Items favorably affecting gross profit margin: n Supply chain efficiencies and cost reduction measures n Movement in Q2 2008 of certain third-party logistics activities in-house n Reduction in field service costs n Reduction in manufacturing costs as a resu
Slide 15: Third Quarter 2009 Operating Expenses
Third Quarter 2009 Operating Expenses Expect fourth quarter of 2009 SG&A to be in the range of $8.5-10 million and R&D in the range of $2-3 million. ($ Millions)
Slide 16: Nine Months 2009 Operating Expenses
Nine Months 2009 Operating Expenses Expect fourth quarter of 2009 SG&A to be in the range of $8.5-10 million and R&D in the range of $2-3 million. ($ Millions)
Slide 17: Working Capital Management
Working Capital Management Days Inventory On Hand Q2 2007 Q3 2007 Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009
Slide 18: Continuing to focus on additional inventory reductions
We are continuing to focus on achieving additional inventory reductions. q Inventory decrease from the fourth quarter 2008 resulted from a $2.0 million decrease in finished good inventory consisting of: n Reduced materials inventory and n Reduced spare parts inventory. q Inventory increase in Q3 200
Slide 19: 2009 Available Cash
2009 Available Cash q Available cash increased from the fourth quarter 2008 due to: n Inventory reductions, n Cost reductions, and n Improved cash management. q Operating activities provided $2.2 million of cash. q We have no debt, except for capital leases. Expect our capital expenditures for the f
Slide 20: Progress Report
Progress Report Abe Reichental President & CEO
Slide 21: Customer Value From Proprietary Systems, Materials and Parts
Customer Value From Proprietary Systems, Materials and Parts Technology Stockholder Value From Profitable Recurring Revenue Growth
Slide 22: Announced Growth Initiatives
Announced Growth Initiatives o We acquired certain assets of Desktop Factory, an Idealab company that was developing a sub-$5,000 3-D printer. n We plan to further develop this technology and integrate it into our expanding family of desktop and professional 3-D Printers. o We acquired the assets of
Slide 23: Revenue Growth Drivers
Revenue Growth Drivers q We entered the fourth quarter of 2009 with a stronger sales funnel than in the third quarter of 2009. q We are pleased with our first full quarter of V-Flash ® sales and believe that we are on track to achieve our targeted first anniversary run rate of 250 units per quarter.
Slide 24: Looking Ahead: Revenue Outlook
Looking Ahead: Revenue Outlook o While we expect economic recovery to be agonizingly slow, we believe that market conditions have stabilized. o Given our strengthened portfolio of products and services, we expect sequential revenue growth during the fourth quarter. n We anticipate slower materials r
Slide 25: Looking Ahead: Operating Expenses And Cash
Looking Ahead: Operating Expenses And Cash q We expect our gross profit margin to remain strong, notwithstanding lower revenue, adverse systems mix and a negative 2-4 percentage point drag from initial V-Flash ® shipments. q We expect SG&A to be in the range of $8.5-10 million for the fourth quarter
Slide 26: Bottom Line
Bottom Line q With these growth initiatives in place, our funnel of new opportunities for the remainder of 2009 is stronger than it was in the third quarter. q Our three pillars of business: Parts , Printers and Production Systems should help drive demand for our products by OEMs. q Our business mod
Slide 27: Question and Answer Session
• Phone: 1-888-336-3485 • International: 1-706-634-0653 • Confirmation Code: 3602 8148 Question and Answer Session
Slide 28: Thank You For Participating
A replay of this webcast will be available approximately three hours after the call on the 3D Systems Investor Relations Web site, www.3dsystems.com/ir . Check out our new 3Dproparts™ website at www.3Dproparts.com Thank You For Participating