Stratasys, Ltd. · NASDAQ:SSYS
Stratasys — Q1 2014 Earnings Presentation
27 slides from Stratasys's earnings presentation, May 9, 2014
Slide 1: Q1-2014 Financial Results Conference Call
XX March 2013 Q1-2014 Financial Results Conference Call May 9th 2014
Slide 2: Conference and webcast details
Q4-2013 Conference and webcast details 2 .. CEO David Reis .. CFO & COO Erez Simha .. VP, Investor Relations Shane Glenn Speakers Live Dial-in Information PRIMARY DIAL-IN: (866) 318-8617 INTERNATIONAL DIAL-IN: (617) 399-5136 PARTICIPANT PASSCODE: 37260413 PRIMARY DIAL-IN: (866) 318-8617 INTERNATIONA
Slide 3: Forward looking statement
Stratasys Forward looking statement Certain information included or incorporated by reference in this press may be deemed to be “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, and Section 21E of the S
Slide 4: Summary
Experienced strong revenue growth of 54%, including 33% organic revenue growth, driven by sales of higher-margin products and services Strong growth of our higher-margin products contributed to an impressive gross margin of 61% for the first quarter Invested aggressively in sales, marketing, and pro
Slide 5: Financial Results Non-GAAP
Financial Results Stratasys Ltd. Non-GAAP ($ in millions unless noted otherwise) 5 Quarter Highlights: .. Revenue growth of 54% YOY .. Organic revenue growth of 33% YOY .. Non-GAAP GM rose to 61% from 59% .. Non-GAAP net income growth of 17% YOY Q1-13 Q1-14 Change YOY Unit Sales 1,168 8,802 653.6% T
Slide 6: Financial Results Revenue
Financial Results Revenue Stratasys Ltd. Non-GAAP ($ in millions) 6 Total Revenue - Quarter Total Revenue .. Quarterly Trend Quarter Highlights: .. System revenue +71% YOY .. Consumable revenue +36% YOY .. Maintenance Revenue and Related Services +64% YOY $82.8 $129.5 $15.4 $21.7 Q1-2013 Q1-2014 Pro
Slide 7: Financial Results System Unit Sales
Financial Results System Unit Sales1 Stratasys Ltd. 7 Total Units .. Quarter Total Units .. Quarterly Trend (1) Includes systems sold by Stratasys, Inc. in all periods; and units for MakerBot starting only on August 15, 2013 Quarter Highlights: .. MakerBot impact .. Launch of the Objet500 Connex3 Co
Slide 8: Financial Results Gross Profit
63.9% 62.9% 62.3% 62.9% 63.5% 32.1% 38.5% 37.6% 41.9% 45.8% 59.0% 59.2% 58.8% 60.2% 60.9% Q1 '13 Q2 '13 Q3 '13 Q4 '13 Q1 '14 Product Gross Margin Service Gross Margin Total Gross Margin Gross Margin .. Quarterly Trend ($ in millions unless noted otherwise) Q1-13 Q1-14 % Change YOY Product Revenue %
Slide 9: Financial Results Operating Profit
Operating Profit Analysis .. Quarterly Trend ($ in millions unless noted otherwise) Q1-13 Q1-14 % Change YOY R&D Expense % of sales 9.9 10.1% 15.3 10.1% +54.4% SG&A Expense % of sales 27.7 28.2% 54.1 35.8% +95.2% Total Operating Exp. % of sales 37.6 38.3% 69.4 45.9% +84.5% Total Operating Profit % m
Slide 10: Financial Results Growth Drivers
Financial Results Growth Drivers Stratasys Ltd. Non-GAAP 10 Q1-2014 (YOY) Units Dollars System Revenue +654% +71% Consumables Revenue -- +36% Maintenance Revenue and Related Services -- +64% RedEye Parts Services -- +4%
Slide 11: Financial Results Revenue Geographic Mix
Financial Results Revenue Geographic Mix Stratasys Ltd. Non-GAAP 11 North America, 50% EMEA, 27% APAC, 22% Other, 1% Geographic Sales Q1-2014 North America, 51% EMEA, 28% APAC, 20% Other, 1% Geographic Sales Q1-2013
Slide 12: Financial Results Balance Sheet Summary
Financial Results Balance Sheet Summary Stratasys Ltd. ($ in millions unless noted otherwise) 12 Selected balance sheet items ($ in millions) Q4-13 Q1-14 Cash , Cash Equivalents & Inv. $616.1 $607.5 Accounts Receivable 99.2 106.0 Inventories 88.4 99.8 Net Working Capital 714.4 712.8 Highlights .. $6
Slide 13: Financial Results & Projections
13 $277 $359 $487 $660-$680 $0.94 $1.49 $1.84 $2.15 .. $2.25 $0.75 $0.95 $1.15 $1.35 $1.55 $1.75 $1.95 $2.15 $- $100.00 $200.00 $300.00 $400.00 $500.00 $600.00 FY11 FY12 FY13 FY14 (guidance) Revenue (millions) EPS Financial Results & Projections Stratasys Ltd. Non-GAAP ($ in millions unless noted ot
Slide 14: Revenue and Earnings Guidance
Reconciliation of GAAP to Non-GAAP Guidance ($ in millions unless noted otherwise) Revenue $660 to $680 Non-GAAP Net Income $113.3 to $118.6 (1) Stock-Based Compensation Exp. $25.1 - $28.2 (2) Amortization of Intangibles $64.8 (3) Merger-Related Expenses $8.8 - $9.8 GAAP Net Income $10.5 - $19.9 GAA
Slide 15: Long-Term Target Operating Model
Revenue growth Operating margin1 Net income margin1 Effective tax rate1 +20% 20% - 25% of sales 15% - 20% 16% - 21% of sales Financial Guidance Long-Term Target Operating Model Stratasys Ltd. Non-GAAP 15 1 Non-GAAP.
Slide 16: Strategic Imperatives
Stratasys Strategic Imperatives 16 Lead in Prototyping Introduce Niche Vertical Applications Expand the Direct Digital Manufacturing (DDM) Business Accelerate New Solutions to the Market Improve 3D Printing Accessibility Improve Customer Intimacy
Slide 17: Platforms to Drive Future Growth
Stratasys Platforms to Drive Future Growth 17 Solid Concepts, Harvest Technologies & RedEye: Creating a Leading Strategic Platform Focused on Meeting Customers’ Additive Manufacturing Needs Provides Stratasys with Significant Additive Manufacturing and End-Use Parts Production Capabilities, Infrastr
Slide 18: Organizational Structure
Stratasys Organizational Structure 18 Combined organization led by Joe Allison, President of Solid Concepts, with support of the strong management teams of Solid Concepts, Harvest Technologies and RedEye
Slide 19: Growing, Profitable Business Unit
Stratasys Solid Concepts, Harvest Technologies & RedEye 19 Operate as a Growing, Profitable Business Unit Within SSYS Cross Selling Synergies Establish a Fulfillment Platform for Expanding EUP Strategy Parts Sell 3D Printers 3D Printers S ell Parts
Slide 20: Transactions Enhance Shareholder Value
Stratasys Transactions Enhance Shareholder Value 20 ..Enables Stratasys to Leverage Significant Additive Manufacturing Services Experience ..Creates Opportunity For Cross-selling Synergies ..Compelling Financial Benefits ..Clear path to completion ..Transactions subject to customary closing conditio
Slide 21: Recent New Product Introductions
Stratasys Recent New Product Introductions 21 2013 Q1 2014 Digital ABS2 Nylon 12 MakerBot Flexible Filament MakerBot Dissolvable Filament MakerBot Digitizer Desktop 3D Scanner Objet30 OrthoDesk 3D Printer Solidscape 3Z MAX MakerBot Replicator 2X Objet500 Connex3 Color Multi- Material 3D Printer Endu
Slide 22: New Innovative Products to Drive Future Growth
New Innovative Products to Drive Future Growth 22 Impressive Demand for New Products Connex3 and MakerBot Replicator Strong Interest in Upcoming Releases MakerBot Replicator Mini and Z18 Shipping in Q2 2014
Slide 23: Structure to Drive Future Growth
Stratasys Structure to Drive Future Growth 23 Acquisition of Certain Assets of Interfacial Solutions: Provides Structure Alignment to Support Future Growth Opportunities .. Strengthens materials R&D skills and bandwidth .. Enables vertical integration of material development and manufacturing .. Inc
Slide 24: Structure Alignment to Support Future Growth Opportunities
Stratasys Structure Alignment to Support Future Growth Opportunities 24 Update on Stratasys .. Objet Integration Phase 1 .. Sales & Channel .. Marketing .. Services Phase 2 .. R&D .. Operations Unified Marketing Integrated Services Operational Alignment Aligned Global Channel Consolidated Global R&D
Slide 25: Summary & Outlook
Impressive Q1 results as market demand remains strong Sales of higher-margin products and services helped drive strong organic revenue growth and a significant increase in gross margin Recent acquisitions intended to create comprehensive parts solution for customers and drive incremental growth oppo
Slide 26: We are Stratasys
XX March 2013 We are Stratasys We shape lives by revolutionizing the way things are made .. We are innovation .. We are fearless leaders .. We are customer driven .. Our quality matters .. Our people make the difference
Slide 27: Reconciliation of Non-GAAP Adjustments
28 Reconciliation of Non-GAAP Adjustments Stratasys Ltd. Combined Q1-13 Q1-14 Net sales, products Deferred revenue purchase price 1,015 $ 235 $ Cost of sales, products Acquired intangible assets amortization (18,762) (13,225) Non-cash stock-based compensation expense (318) (503) Merger and acquisiti