3d Systems Corporation · NYSE:DDD
3d Systems — Q4 2017 Earnings Presentation
32 slides from 3d Systems's earnings presentation, Mar 14, 2018
Slide 1: Fourth Quarter and Full Year 2017
Fourth Quarter and Full Year 2017 March 14, 2018
Slide 2: Welcome and Participants
Welcome and Participants • Vyomesh Joshi – President & Chief Executive Officer • John McMullen – Executive Vice President & Chief Financial Officer • Andy Johnson – Executive Vice President & Chief Legal Officer • Stacey Witten – Vice President, Investor Relations To participate via phone, please di
Slide 3: Forward Looking Statements
Forward Looking Statements This presentation contains certain statements that are not statements of historical or current facts are forward - looking stateme nts within the meaning of the Private Securities Litigation Reform Act of 1995. Forward - looking statements include statements concerning pla
Slide 4: Vyomesh Joshi, President & Chief Executive Officer
Vyomesh Joshi (VJ) President & Chief Executive Officer
Slide 5: Building the Foundation
Building the Foundation 5 • We are in a multi - year transformation, and actions last year centered around building the foundation to enable us to capitalize on the significant opportunity ahead • We focused on building the infrastructure, processes, analytics and organizational structure necessary
Slide 6: Fourth Quarter Results Overview
Fourth Quarter Results Overview 6 • Revenue increased 7% to $177.3 million, including revenue growth in healthcare, materials, software and on demand manufacturing as well as increased printer unit sales • Gross Profit Margin was 48.2% • Continued investing in innovation, IT infrastructure, go - to
Slide 7: John McMullen, Executive Vice President & Chief Financial Officer
John McMullen Executive Vice President & Chief Financial Officer
Slide 8: GAAP Operating Results
GAAP Operating Results 8 2017 2016 Y/Y Change 2017 2016 Y/Y Change $ 177.3 $ 165.9 7% $ 646.1 $ 633.0 2% $ 85.5 $ 82.9 3% $ 304.8 $ 309.8 (2%) 48.2% 50.0% -180 bps 47.2% 48.9% -170 bps $ 68.2 $ 57.8 18% $ 264.2 $ 259.8 2% $ 23.0 $ 21.1 9% $ 94.6 $ 88.4 7% $ 91.2 $ 78.8 16% $ 358.8 $ 348.2 3% 51.4% 4
Slide 9: Non-GAAP Financial Measures
Non - GAAP Financial Measures 9 - We use non - GAAP measures to supplement our financial statements presented on a GAAP basis because management believes non - GAAP financial measures are useful to investors in evaluating our operating performance and to facilitate a better understanding o f t he im
Slide 10: Revenue Drivers
Revenue Drivers • Healthcare solutions increased 13% to $50.4 million • Materials increased 8% to $42.8 million • Software increased 8% to $26.0 million • On demand manufacturing increased 10 % to $26.5 million • Printers revenue was approximately flat at $34.9 million Q4 2017 compared to Q4 2016: 1
Slide 11: Gross Profit and Margin
Gross Profit and Margin • GPM was 48.2% in the fourth quarter and 47.2% in full year 2017 • Cost reduction initiatives were offset by additional investments in services and on demand manufacturing in 2017 11 - Q3 2016 GAAP GPM was negatively impacted by charges of $10.7 million related to project an
Slide 12: Operating Expenses
Operating Expenses 12 • GAAP operating expenses increased 16% in Q4 and 3% for the full year • Non - GAAP operating expenses increased 17% in Q4 and 10% for the full year • SG&A expenses increased primarily from investments in go to market and IT • R&D expenses included investment in plastics, metal
Slide 13: Cash and Balance Sheet
Cash and Balance Sheet • Generated $8.2 million of cash from operations during Q4 • Generated $25.9 million of cash from operations in full year 2017 • Cash balance of $136.3 million at December 31, 2017 13
Slide 14: Outlook
Outlook 14 • We are in the midst of a multi - year transformation of the company • We have made significant progress in many areas and completed a lot of foundational work in 2017, but we still have more work to do • We remain focused on continuing to improve our organization and operational efficie
Slide 15: Vyomesh Joshi, President & Chief Executive Officer
Vyomesh Joshi (VJ) President & Chief Executive Officer
Slide 16: Transformation and Driving Growth
Transformation and Driving Growth 16 • In 2017, we made significant progress to stabilize and turn around the company, addressed many legacy issues and put in place the foundation for scalable growth • We believe 2018 is a corner turn year in a multi - year transformation project • We are focused on
Slide 17: Enhance Market Leading Portfolio
Enhance Market Leading Portfolio 17 • NextDent 5100, a Figure 4 - based 3D printer designed for dental labs, combined with a total of 30 dental materials for a wide range of indications • FabPro 1000, a low - cost , high - productivity, DLP - based 3D printer designed for dental and jewelry producti
Slide 18: Q&A Session
Q&A Session In the USA: 1 - 877 - 407 - 8291 Outside the USA: 1 - 201 - 689 - 8345
Slide 19: Thank You
4d 3D SYSTEMS Thank You
Slide 20: Appendix
4d 3D SYSTEMS Appendix
Slide 21: Revenue Summary by Category
Revenue Summary by Category 21 $ in millions Q4 2017 Q3 2017 Q4 2016 YOY Change Sequential Change Printers $ 34.9 $ 29.4 $ 35.1 (1%) 19% Software Products $ 14.6 $ 10.6 $ 12.8 14% 38% Other Products $ 10.1 $ 8.2 $ 12.3 (18%) 23% Total Products $ 59.6 $ 48.2 $ 60.2 (1%) 24% Total Materials $ 42.8 $ 3
Slide 22: Reconciliation Q4 and Full Year Earnings (Loss) Per Share
Non - GAAP Reconciliation 22 Q4 and Full Year Non - GAAP Earnings (Loss) Per Share 2017 2016 2017 2016 GAAP Net income (loss) attributable to 3D Systems Corporation ($10.1) $5.2 ($66.2) ($38.4) Adjustments: Amortization, stock-based compensation & other 1 $15.1 $12.7 $62.9 $78.3 Legal and acquisitio
Slide 23: Reconciliation Q4 and Full Year Gross Profit & Margin
Non - GAAP Reconciliation 23 Q4 and Full Year Gross Profit & Margin 2017 2016 2017 2016 GAAP Gross Profit $85.5 $82.9 $304.8 $309.8 GAAP Gross Profit Margin 48.2% 50.0% 47.2% 48.9% Adjustments: Amortization, stock-based compensation & other $0.1 $0.1 $0.4 $11.1 Legal and acquisition-related 1 $0.0 $
Slide 24: Reconciliation Q4 and Full Year Operating Expenses
Non - GAAP Reconciliation 24 Q4 and Full Year Non - GAAP Operating Expenses 2017 2016 2017 2016 GAAP R&D Expenses $ 23.0 $ 21.1 $ 94.6 $ 88.4 GAAP SG&A Expenses $ 68.2 $ 57.8 $ 264.2 $ 259.8 GAAP Operating Expenses $91.2 $78.8 $358.8 $348.2 Adjustments to R&D Expenses: Portfolio restructuring $ 0.0
Slide 25: Reconciliation Q3 and Nine Months Earnings (Loss) Per Share
Non - GAAP Reconciliation 25 Q3 and Nine Months Non - GAAP Earnings (Loss) Per Share 2017 2016 2017 2016 GAAP Net loss attributable to 3D Systems Corporation ($37.7) ($21.2) ($56.1) ($43.6) Adjustments: Amortization, stock-based compensation & other 1 $15.5 $29.1 $47.7 $65.6 Legal and acquisition-re
Slide 26: Reconciliation Q3 and Nine Months Gross Profit & Margin
Non - GAAP Reconciliation 26 Q3 and Nine Months Gross Profit & Margin 2017 2016 2017 2016 GAAP Gross Profit $58.5 $68.9 $219.4 $226.9 GAAP Gross Profit Margin 38.3% 44.1% 46.8% 48.6% Adjustments: Amortization, stock-based compensation & other $0.1 $10.8 $0.3 $11.0 Legal and acquisition-related 1 $0.
Slide 27: Reconciliation Q3 and Nine Months Operating Expenses
Non - GAAP Reconciliation 27 Q3 and Nine Months Non - GAAP Operating Expenses 2017 2016 2017 2016 GAAP R&D Expenses $ 24.4 $ 26.1 $ 71.7 $ 67.4 GAAP SG&A Expenses $ 66.5 $ 64.8 $ 196.0 $ 202.0 GAAP Operating Expenses $90.9 $90.9 $267.7 $269.4 Adjustments to R&D Expenses: Portfolio restructuring $ 0.
Slide 28: Reconciliation Q2 and Six Months Earnings (Loss) Per Share
Non - GAAP Reconciliation 28 Q2 and Six Months Non - GAAP Earnings (Loss) Per Share 2017 2016 2017 2016 GAAP Net loss attributable to 3D Systems Corporation ($8.4) ($4.6) ($18.4) ($22.4) Adjustments: Amortization, stock-based compensation & other 1 $ 16.3 $ 16.1 $ 32.3 $ 36.6 Legal and acquisition-r
Slide 29: Reconciliation Q2 and Six Months Operating Expenses
Non - GAAP Reconciliation 29 Q2 and Six Months Non - GAAP Operating Expenses 2017 2016 2017 2016 GAAP R&D Expenses $ 24.4 $ 20.9 $ 47.3 $ 41.2 GAAP SG&A Expenses $ 63.1 $ 63.2 $ 129.5 $ 137.2 GAAP Operating Expenses $87.5 $84.1 $176.8 $178.4 Adjustments 1 : Amortization, stock-based compensation & o
Slide 30: Reconciliation Q1 Earnings (Loss) Per Share
Non - GAAP Reconciliation 30 Q1 Non - GAAP Earnings (Loss) Per Share 2017 2016 GAAP Net loss attributable to 3D Systems Corporation ($10.0) ($17.8) Adjustments: Amortization, stock-based compensation & other 1 $ 16.0 $ 20.5 Legal and acquisition-related 2 $ 1.1 $ 1.0 Tax effect of adjustments 3 - $
Slide 31: Reconciliation Q1 Operating Expenses
Non - GAAP Reconciliation 31 Q1 Non - GAAP Operating Expenses 2017 2016 GAAP R&D Expenses $ 22.9 $ 20.3 GAAP SG&A Expenses $ 66.4 $ 74.0 GAAP Operating Expenses $89.3 $94.3 Adjustments 1 : Amortization, stock-based compensation & other $ 15.9 $ 20.4 Legal and acquisition-related $ 1.1 $ 1.0 Non-GAAP
Slide 32: Thank You
4d 3D SYSTEMS Thank You