3d Systems Corporation · NYSE:DDD
3d Systems — Investor Day (May 2011)
85 slides from 3d Systems's investor day presentation, May 26, 2011
Slide 1: NYSE Investor Day
NYSE Investor Day May 2011
Slide 2: Agenda
e Welcome Stacey Witten ¢ New Identity Cathy Lewis ¢ Overview Abe Reichental ¢ Growth Initiatives Kevin McAlea ¢ Financial Highlights Damon Gregoire ¢ Bespoke Innovations Scott Summit e Technology Update Chuck Hull e Looking Ahead Abe Reichental © Q&A All
Slide 3: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements, as defined by federal and state securities laws. Forward- looking statements include statements concerning plans, objectives, goals, strategies, expectations, intentions, projections, developments, future events, perfo
Slide 4: New Identity
New Identity Cathy Lewis www.3dsystems.com NYSE:DDD Ran y Be. : << ~~ . wa eo = 5 ne
Slide 5: Transforming Our Business Model And Identity
Transforming Our Business Model And Identity
Slide 6: Honoring The Past
Honoring The Past
Slide 7: Empowering Professionals And Consumers Alike
Empowering Professionals And Consumers Alike
Slide 8: Company Overview
ompany Overview Abe Reichental sideni,and www.3dsystems.com NYSE: DDD
Slide 9: Compelling razor and blades business
Compelling razor and blades business Well positioned for growth Leadership through technology & acquisitions Continued operating leverage Create With» Confidence
Slide 10: Leading Provider of 3D Content-to-Print Solutions
Leading Provider of 3D Content-to-Print Solutions ee Freedom of creation to print functional Cost effective alternative to traditional plastic and metal parts design and manufacturing methods Transportation Consumer Products Recreation Healthcare Education Create With» Confidence
Slide 11: First Mover Advantage. Diverse Customer Base
First Mover Advantage. erse Customer Base se! Pratt & Whitney | GM QaaENG =i {4 TELEDYNE WATER PIK ] \ )) winex invisalign | hse | FLUKE. * SIEMENS Jako CATERPILLAR
Slide 12: Global Reach with Local Presence
Global Reach with Local Presence United States Create With Confidence
Slide 13: Balanced Revenue Composition
Balanced Revenue Composition By Geography By Category Printers 34% Create With» Confidence
Slide 14: Business Model Innovation
Business Model Innovation o*o%e 2010 Gross Profit $74.0 M L -_ = Printer Consumables Services MACTieag e ° Sims Loc 23%) 28% ee Flexible Technology Platform Create With» Confidence
Slide 15: Technology Leadership
Technology Leadership _ r) PM Platform SixPrint f Materials . Formulating ~ ORS
Slide 16: New Products Fuel Revenue Growth
New Products Fuel Revenue Growth $15.00 mQ1, 2009 coo | mQ1, 2010 San Qt, 2011 $0.00 \f «increased year-over-year revenue contribution from new products *Reflects products that are in their first three years of commercial status * Expect a rate of three new printers and four new print materials annu
Slide 17: Professional 3D Production Printers, On Demand Parts
Professional 3D Production 30 Printers___On Demand 30 Parts ‘A Manufacturing Revolution Born to Ride Investing in the Future Create With» Confidence
Slide 18: Clear Competitive Advantage
Clear Competitive Advantage We offer a comprehensive tool box... we sell our customers the right tool for the right job Print Engine: Kel Patents , Endless pplicat ions Z ‘400 Paten’ P 4 di Ay > Six gines go” Our competitors sell different size E> hammers... to them Se every application SE MS Z y lo
Slide 19: Printability... Accept No Imitations
Printability... Accept No Imitations
Slide 20: Focused Growth Initiatives
Focused Growth Initiatives Build 3D custom Accelerate 3D parts global printer services, expand penetration through through channel acquisitions and expansion and organic growth new products Design Content creatives libraries Grow 3D healthcare revenue leveraging our customer base and core competenci
Slide 21: Proven Acquisition Track Record - Augments Growth
Proven Acquisition Track Record - Augments Growth uitable candid; 2009 Desktop Factory Acu-Cast Technologies ‘AdvaTech Manufacturing 2010 Moeller Design & Development Design Prototyping Technologies cer Protometal Express Pattern Bits From Bytes Provel 2011 National RP Support Quickparts® atl Sycode
Slide 22: Balanced Priorities and Culture
Balanced Priorities and Culture ‘+ Improve our customers’ bottom line Customer ‘+ Enhance total customer experience x * Increase sales and margins * Accelerate cash velocity I ) Excellence * Experienced, empowered team * Faster, simpler business processes * Entrepreneurship...agility * Leverage comp
Slide 23: Underpenetrated Marketplace
Underpenetrated Marketp: B Uncecevslopad Underrated Manetnaces
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Slide 25: Marketplace Convergence Drives Opportunities
rketplace Convergence Drives Opportunities Spoon... Re ort) FFehoecr $500 Million | Our solutions replace, displace or augment _ = 5 traditional design-to-manufacturing alternatives i Create With» Confidence
Slide 26: Focused Growth Initiatives
Focused Growth Initiatives Build 3D custom Accelerate 3D parts global printer services, expand penetration through through channel acquisitions and expansion and organic growth new products Grow 3D healthcare revenue leveraging our customer base and core competencies CreateWith Confidence
Slide 27: Results From Growth Initiatives: Custom Parts Services
Results From Growth Initiatives: Custom Parts Services Consolidate channel Build scale and presence Shape brand experience Deliver latest Access to end users capabilities Improved gross profit margin sequentially + 26% 04, 2010 + 39% Q1, 2011 Generated $10.3 million custom parts services revenue in
Slide 28: Results From Growth Initiatives: 3D Printers
Results From Growth Initiatives: 3D Printers Record 2010 printer revenue of $54.7 Record Q1 2011 printer revenue of $13.5 J million and 79% growth over prior year 7” million and 54% growth over Qi 2010
Slide 29: Most Complete Product Portfolio On The Market
st Complete Product Portfolio On The Market Personal 3D Printers Professional 3D Printers Production 3D Printers Price: $250,000 - $950,000 Price: $1,300 - $9,900 Price: $49,000 - $199,000 Create With» Confidence
Slide 30: Printer Razor and Blade Profile
Printer Razor and Blade Profile © Our “razor and blades” business model centers on sustainable profitable growth from consumables © We expect higher margin integrated print materials revenue to drive further margin expansion and reduce seasonality as our installed base grows over time Our personal a
Slide 31: Results From Growth Initiatives: Healthcare Solutions
Results From Growth Initiatives: Healthcare Solutions ITE hearing aids Dental restorations Orthodontic aligners. Orthopedic implants Prosthetics Trauma procedures , Healthcare revenue 50% of 2010 and 64% of G4 phludes printers print sepresented 14% of total 2011 healtheare solutions , revenue and 13
Slide 32: Motorsport
Motorsport Wind-Tunnel to On-Car Automotive Bridge Manufacturing High-Value Short Runs Aerospace teggl 1 And Defense Create With Confidence
Slide 33: Results From Growth Initiatives: Print Materials
Results From Growth Initiatives: Print Materials 39% of Q4 2010 | } 50% of Qi 2011 expansion ww | 2 Create Witt Confidence Continued margin |
Slide 34: Full Year
Full Year ‘ $305 Printers $547 Ea Print Materials Health Care
Slide 35: Printability... Enhanced Marketplace Differentiation
Printability... Enhanced Marketplace Differentiation Exceptional sidewall quality Unprecedented surface smoothness Remarkable feature resolution Best-in-class edge definition Tolerances that rival the accuracy of CNC-machined parts aad | i 3 Createwiti Confidence
Slide 36: Powerful Global Brand
Powerful Global Bran 3 Print - Company Printers Materials Services iPro™ Acura® sPro™ DuraForm® = mi. 30 Pris Pr 3D Printers | Pr ion 3D Printers | On Demand 3D Parts Create With» Confidence
Slide 37: Outlook
Outlook We entered the second quarter of 2011 with a strong sales funnel and we expect revenue growth over the prior year quarter and sequentially for the second quarter of 2011 We expect strong demand for our personal, professional and production printers, helped by our expanding channel and portfo
Slide 38: Financial Overview
> Financial Overview Damon Gregoire i j and CFO www.3dsystems.com NYSE: DDD
Slide 39: Revenue by category
$in millions a $88 nnters $135 EN Services Print Materials teathCc a $02 zy | 1 revenue grew 51%
Slide 40: Revenue by geography and category
so +—________$a79 - $47.9 40 — Pa $31.6 _ Asia Pacific 5 Services Europe 20 33% Materials 43% 7 aq _ |__ 18% Printers North % America 0 ied 2010 2011 2010 2011 Create With Confidence
Slide 41: Gross Profit and Margin Trend
Gross Profit and Margin Trend $3.4 36% 75% 13% Printers $5.5 41% Materials $9.9 63% $83 61% 20% 5% Services $7.8 42% $2.9 32% 167% 31% Total $23.2 48% $14.3 45% 62% 7% Gross Profit Margin aol GSA ANN Beesaas — 51= 2010 2011
Slide 42: Margin Expansion Path Towards Long Term Target Model
Margin Expansion Path Towards Long Term Target Model 56% GPM at $200 million and 62% at $300 million revenue run-rate -Better overhead absorption from higher revenue Favorable print material mix towards | -Higher personal printers integrated printers materials unit sales as a percentage of -Migratio
Slide 43: First Quarter Operating Expenses
First Quarter Operating Expenses Selling, general & administrative $13.0 $9.2 Research and development $2.8 $25 Total Operating Expenses $15.8 $117 % of Revenue 33% 37% Expect SG&A to be in the Expect R&D to be in the range of $40-45 million for range of $9-11 million for remainder of 2011 remainder
Slide 44: Operating Leverage Expected To Continue
Operating Leverage Expected To Continue _Sin millions 60 50 40 30 20 10 Revenue Trend Line & &, %, %, &, &, &, %, &, o> & % © % © © % SG&A expenses ‘A costs expected to grow rate to revenue growth as acqui: fully integrated Internal systems and processes increased revenue without addi administrative
Slide 45: Factors Affecting Earnings Per Share
Factors Affecting Earnings Per Share First quarter 2011 diluted earnings per share $0.28 Legal costs reduced EPS by 7 cents per share for the quarter INet income of $6.8 million for the 2011 quarter included $2.8 million of non-cash expenses related to idepreciation, amortization and stock-based com
Slide 46: Favorable EPS Trend
Favorable EPS Trend Create With Confidence
Slide 47: Working Capital
Working Capital (Sin millions) P| Memon ene Seem Cash $70.8 $373 Inventory $26.6 $23.8 Accounts Receivable $39.3 $358 Accounts Payable $23.4 $26.6 Working Capital $765 $425 * Cash increased $33.5 million from the fourth quarter of 2010, primarily reflecting $54.0 million proceeds from our equity rai
Slide 48: Balance Sheet Management
Balance Sheet Management No debt Strong cash balance Strong balance sheet coupled with operating leverage allows us to fund our strategic initiatives (Balanced inventories Quality receivables Create With» Confidence
Slide 49: Long Term Target Operating Model
rm Target Operating Model Revenue $200 $300 $47.9 Gross Profit 56% 62% 48% SG&A 23% 20% 27% R&D 1% 5% 6% Operating Income 26% 37% 15% Net Income After Tax* 18% 22% 14% Depreciation & Amortization 4% 3% 5% Capital Expenditures 2% 1% 1% Recurring Revenue 70% 75% 72% * Net income is inclusive of the es
Slide 50: Bespoke Innovations
Bespoke Innovations Scott Summit www.3dsystems.com NYSE: DDD
Slide 51: Bespoke Innovations: Because Every Body Is Different
Bespoke Innovati Because Every Body Is Different
Slide 52: Transforming The Prosthetic
Transforming The Prosthetic
Slide 53: Changing Perceptions
Changing Perceptions
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Slide 55: Giving A Body Back
Giving A Body Back = “ Cone Confidence
Slide 56: Concept Legs: Low Cost, High Function
Concept Legs: Low Cost, High Function al | i 56 Createwiti Confidence
Slide 57: Concept legs: High Quality, High Style
Concept legs: High Quality, High Style
Slide 58: Concept legs: Complexity Is Free
Concept legs: Complexity Is Free a = V Create With» Confidence
Slide 59: Additive Fabrication: The Market
Additive Fabrication: The Market ~ 4 | : 9 Createwiti Confidence
Slide 60: Technology Overview
Jechnology Overview Chuck Hull
Slide 61: Technology Leadership
Technology Leader: | six Print Materials Formulating fm Families of S' ~400 patents issued, ~150 \_ pending o Create With Confidence
Slide 62: Intellectual Property Stewardship
Intellectual Property Stewards! } Licensing ) ~400 Patents Enforcement
Slide 63: Development Culture
Development Culture = & es = 6 3 2 3 £ = a Zz Completely New Core Product Line Extensions Revisions Repositioning's Changes to Augmented Product
Slide 64: Over the past months we introduced new products
Over the past 12 months we introduced 10 new products ww / Create With» Confidence
Slide 65: Augmentations and Revisions
Augmentations and Revisions
Slide 66: Crossovers
Crossovers
Slide 67: Extensions
Extensions
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Slide 69: Completely New
Completely New
Slide 70: Expanding Price And Performance Continuum
Expanding Price And Performance Continuum Personal 3D Printers Professional 3D Printers Production 3D Printers ont se >$900,000
Slide 71: It's About Printability
It’s About Printability ° print. ability ability to deliver required user performance, precision, accuracy feature detail and surface smoothness consistently and economically Productivity c=4 Performance O Create With Confidence
Slide 72: Outlook
Outlook Abe Reichental
Slide 73: Focused Growth Initiatives
Focused Growth Initiatives Grow 3D healthcare revenue leveraging our customer base and core competencies Build 3D custom Accelerate 3D parts global printer services, expand penetration through through channel acquisitions and expansion and organic growth new products Build 3D consumer content produc
Slide 74: Focused Growth Initiatives: Parts
ocused Growth Initiatives: Parts Build 3D custom parts global services, expand through acquisitions and organic growth Expect additional acquisitions in North America, Europe and ig Asia-Pacific margins Create With» Confidence
Slide 75: Accelerate 3D printer penetration
Accelerate 3D printer penetration through channel expansion and new products Expect continued reseller channel expansion printers annually Create With» Confidence
Slide 76: Focused Growth Initiatives: Healthcare
ocused Growth Initiatives: Healthcare | Grow 3D healthcare Expect continued hearing aid, dental and orthodontics is e growth applications revenue leveraging our customer base and core competencies Create With» Confidence
Slide 77: Focused Growth Initiatives: Consumer
Focused Growth Initiatives: Consumer Build 3D consumer content products and services, expand through acquisitions and organic growth Create With» Confidence
Slide 78: The 3D Consumer Opportunity
The 3D Consumer Opportunity
Slide 79: Change Is Underway In The 3D World
Change Is Underway In The 3D World Physical world Moving to digital eserves oe al J _ » Create Witt Confidence
Slide 80: Change Transformed The 2D Image World
S| Change Transformed The 2D Image World la 4 Picasa.
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