Slide 1: Q3 2014 Financial Results Conference Call
Q3 2014 Financial Results Conference Call
Slide 2: Q3 2014 Conference and webcast details
Q3 2014 Conference and webcast details Live Dial-in Information Primary Dial-in: 866-515-2913 International Dial-in: 617-399-5127 Participant Passcode: 50996956 Live webcast and replay: http://www.media-server.com/m/p/3my5yedw Speakers David Reis CEO Erez Simha COO & CFO Shane Glenn VP, Investor Rel
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 & Outlook
Summary & Outlook Positive sales momentum across a wide range of products, particularly from our high-end systems, as well as MakerBot Favourable product mix contributed to healthy margins – offsetting the impact of acquisitions Completed acquisitions of Solid Concepts, Harvest Technologies, GrabCAD
Slide 5: Results: Stratasys Ltd. Non-GAAP
Financial Results Stratasys Ltd. Non-GAAP Q3-13 Q3-14 Change YOY Unit Sales 5,925 10,965 85.1% Total Revenue $126.1 $203.6 +61.5% Revenue/ Employee 0.075 0.072 -4.5% Gross Profit % margin 74.1 58.8% 118.8 58.4% +60.3% Operating Expenses % of sales 49.9 39.6% 87.0 42.7% +74.4% Operating Profit % marg
Slide 6: Results: Revenue
Financial Results Revenue Stratasys Ltd. Non-GAAP Total Revenue - Quarter Total Revenue – Quarterly Trend Product Service Product Service System Revenue 59% YOY Consumable Revenue 32% YOY ($ in millions unless noted otherwise)
Slide 7: Results: System Unit Sales
Financial Results Strong Production and Design HE Series Impact of MakerBot Replicator 5th Generation 3D Printers Reached significant company milestone of over 100,000 3D printers sold on a combined pro forma basis 1 Includes systems sold by Stratasys, Inc. in all periods; and units for MakerBot sta
Slide 8: Results: Gross Profit
Financial Results Sales of higher-margin products contributing to healthy margins Core business offsetting impact of acquisitions Gross Profit Stratasys Ltd. Non-GAAP Q3-13 Q3-14 % Change YOY Product Revenue % of sales $108.3 85.9% $160.2 78.7% +47.9% Service Revenue % of sales 17.7 14.1% 43.4 21.3%
Slide 9: Results: Operating Profit
Financial Results Investing for future growth Incremental operating costs from acquisitions Operating Profit Stratasys Ltd. Non-GAAP Operating Profit Analysis – Quarterly Trend Q3-13 Q3-14 % Change YOY R&D Expense % of sales 12.0 9.5% 19.2 9.4% +60.1% SG&A Expense % of sales 37.9 30.1% 67.9 33.3% +7
Slide 10: Results: Revenue Geographic Mix
Financial Results Growth across all regions Strong organic growth in Asia Pacific Revenue Geographic Mix Stratasys Ltd. Non-GAAP Geographic Sales Q3-2013 Geographic Sales Q3-2014 North America EMEA APAC Other North America EMEA APAC Other
Slide 11: Results: Balance Sheet Summary
Financial Results $458.9M in cash and cash equivalents & bank deposits Increased accounts receivable and inventories primarily due to the acquisition of Solid Concepts and Harvest Technologies Balance Sheet Summary Stratasys Ltd. Selected balance sheet items ($ in millions) Q2-14 Q3-14 Cash , Cash E
Slide 12: Results: Revenue and EPS Projections
Financial Results Impressive organic and inorganic sales growth Broad-based demand across our product lines Investments in strategic initiatives and infrastructure to accelerate our growth Adjustment in 2014 guidance reflects the acquisition of GrabCAD ($ in millions unless noted otherwise) * Period
Slide 13: Guidance: Revenue & Earnings Guidance
Financial Guidance Stratasys Ltd. Revenue & Earnings Guidance Non-GAAP $750-$770 $2.21-$2.31 Revenue (M) Non-GAAP Diluted EPS Fiscal 2014 Financial Guidance Reconciliation of GAAP to Non-GAAP Guidance ($ in millions, except per share data) Revenue $750 to $770 Non-GAAP Net Income $114.9 to $120.1 (1
Slide 14: Guidance: Long-Term Target Operating Model
Financial Guidance Stratasys Ltd. Long-Term Target Operating Model Non-GAAP +25% Revenue growth 18%–23% Operating margin 10%–15% Effective tax rate 16%–21% Net income margin of sales of sales
Slide 15: Strategic Imperatives
Strategic Imperatives Lead in Prototyping 01 Expand the Direct Digital Manufacturing (DDM) Business 02 Introduce Vertical Applications 03 Accelerate New Solutions to the Market 04 Improve 3D Printing Accessibility 05 Improve Customer Intimacy 06
Slide 16: Creating A Global Leading Parts Services Business
Creating A Global Leading Parts Services Business Combined Organization Focused on: PMI process Exposing Synergies Accelerating Growth
Slide 17: Parts Services Business Acquisitions' Rationale
Parts Services Business Acquisitions’ Rationale Cross Selling Synergies Parts Sell Printers <-> Printers Sell Parts Establish a Fulfillment Platform for Expanding EUP Strategy Operate as a Growing, Profitable Business Unit Within Stratasys End Use Parts Manufacturing Platform to lead in parts servic
Slide 18: GrabCAD: Improving Customer Intimacy & 3D Printing Accessibility
GrabCAD Improving Customer Intimacy & 3D Printing Accessibility Developing leading 3D printing ecosystem CAD software agnostic Early in PMI process GrabCAD is a Leading 3D CAD Collaboration Platform Workbench provides a cloud-based collaboration platform for designers and engineers to manage, share
Slide 19: New Products
New Products Lead in Prototyping & Accelerating New Solutions to Market 2014 H1 2014 H2 Objet500 Connex3 Color Multi-Material 3D Printer Endur Simulated Polypropylene MakerBot Replicator Objet Eden260V Dental Advantage VeroGlaze Dental MakerBot Replicator Mini MakerBot Replicator Z18 Expanded Connex
Slide 20: Expanding Access to 3D Printing
Expanding Access to 3D Printing Improving Customer Intimacy & 3D Printing Accessibility MakerBot Channel Expansion MakerBot 5th Generation 3D Printers available in select Home Depot locations MakerBot Europe established through the acquisition of German distributor HAFNER’S BÜRO Expanded local pres
Slide 21: Global footprint
System Sales & Support Parts Services Corporate Headquarters Global Offices 29+ Manufacturing Locations 4 Employees 2,800+ Resellers 260+ Software Development
Slide 22: Summary & Outlook
Summary & Outlook Observed broad-based demand for our products and services, with particular strength in our high-performance systems and materials, as well as an impressive contribution from MakerBot. Impressive third quarter results, including record top-line revenue with strong organic growth Obs
Slide 23: We are Stratasys
We are Stratasys We are innovation We are fearless leaders We are customer driven Our quality matters Our people make the difference
Slide 24: Reconciliation of GAAP to Non-GAAP Results of Operations
Reconciliation of GAAP to Non-GAAP Results of Operations Stratasys Ltd. ($ in thousands except per share data) Q3-13 Q3-14 GAAP Adjustments Non-GAAP GAAP Adjustments Non-GAAP Net sales Products $107,887 $434 $108,321 $160,200 $ - $160,200 Services 17,739 - 17,739 43,410 - 43,410 Cost of sales Produc
Slide 25: Reconciliation of Non-GAAP Adjustments
Reconciliation of Non-GAAP Adjustments Stratasys Ltd. ($ in thousands) Q3-13 Q3-14 Net sales, products Deferred revenue purchase price $434 $- Cost of sales, products Acquired intangible assets amortization (12,252) (14,328) Impairment charges - (11,635) Non-cash stock-based compensation expense (40