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 To participate via phone, • John McMullen please dial: – Executive Vice President & Chief Financial Officer In the US: • Andy Johnson 1-877-407-8291 – Executive Vice President & Chief Legal Officer • Stacey Witten Outside
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 statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, o
Slide 4: Vyomesh Joshi (VJ)
Vyomesh Joshi (VJ) President & Chief Executive Officer
Slide 5: Building the Foundation
Building the Foundation • 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 to t
Slide 6: Fourth Quarter Results Overview
Fourth Quarter Results Overview In the fourth quarter of 2017: • Revenue increased 7% to $177.3 million, including revenue growth in healthcare, materials, software and on demand manufacturing as well as increased printer unit sales • Gross Profit Margin was 48.2% • Continued investing in innovation
Slide 7: John McMullen
John McMullen Executive Vice President & Chief Financial Officer
Slide 8: GAAP Operating Results
GAAP Operating Results Fourth Quarter Full Year ($ in millions, except per share) 2017 2016 Y/Y Change 2017 2016 Y/Y Change Revenue $ 177.3 $ 165.9 7% $ 646.1 $ 633.0 2% Gross Profit $ 85.5 $ 82.9 3% $ 304.8 $ 309.8 (2%) Gross Profit Margin 48.2% 50.0% -180 bps 47.2% 48.9% -170 bps SG&A $ 68.2 $ 57.
Slide 9: Non-GAAP Financial Measures
Non-GAAP Financial Measures Fourth Quarter Full Year ($ in millions, except per share amounts) 2017 2016 Y/Y Change 2017 2016 Y/Y Change Non-GAAP R&D Expense $23.0 $21.1 9% $94.6 $82.3 15% Non-GAAP SG&A Expense $54.6 $45.2 21% $202.0 $187.9 8% Non-GAAP Operating Expenses $77.6 $66.2 17% $296.6 $270.
Slide 10: Revenue Drivers
Revenue Drivers Q4 2017 compared to Q4 2016: • 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 10
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 $ in millions - Q3 2016 GAAP GPM was negatively impacted by charges of $10.7 million related to
Slide 12: Operating Expenses
Operating Expenses • 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, metals, ma
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 • 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 efficiency a
Slide 15: Vyomesh Joshi (VJ)
Vyomesh Joshi (VJ) President & Chief Executive Officer
Slide 16: Transformation and Driving Growth
Transformation and Driving Growth • 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 exec
Slide 17: Enhance Market Leading Portfolio
Enhance Market Leading Portfolio • 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 production and high
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
ZN 3D SYSTEMS Thank You
Slide 20: Appendix
ZN 3D SYSTEMS Appendix
Slide 21: Revenue Summary by Category
Revenue Summary by Category Sequential Q4 2017 Q3 2017 Q4 2016 YOY Change $ in millions 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 $ 39.4
Slide 22: Non-GAAP Reconciliation
Non-GAAP Reconciliation Q4 and Full Year Non-GAAP Earnings (Loss) Per Share Fourth Quarter Full Year ($ in millions, except per share amounts) 2017 2016 2017 2016 GAAP Net income (loss) attributable to 3D Systems Corporation ($10.1) $5.2 ($66.2) ($38.4) Adjustments: Amortization, stock-based compens
Slide 23: Non-GAAP Reconciliation
Non-GAAP Reconciliation Q4 and Full Year Gross Profit & Margin Fourth Quarter Full Year ($ in millions) 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 $11.1 Le
Slide 24: Non-GAAP Reconciliation
Non-GAAP Reconciliation Q4 and Full Year Non-GAAP Operating Expenses Fourth Quarter Full Year ($ in millions, except per share amounts) 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 $348.2
Slide 25: Non-GAAP Reconciliation
Non-GAAP Reconciliation Q3 and Nine Months Non-GAAP Earnings (Loss) Per Share Third Quarter Nine Months ($ in millions, except per share amounts) 2017 2016 2017 2016 GAAP Net loss attributable to 3D Systems Corporation ($37.7) ($21.2) ($56.1) ($43.6) Adjustments: Amortization, stock-based compensati
Slide 26: Non-GAAP Reconciliation
Non-GAAP Reconciliation Q3 and Nine Months Gross Profit & Margin Third Quarter Nine Months ($ in millions) 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 $11.
Slide 27: Non-GAAP Reconciliation
Non-GAAP Reconciliation Q3 and Nine Months Non-GAAP Operating Expenses Third Quarter Nine Months ($ in millions, except per share amounts) 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 $26
Slide 28: Non-GAAP Reconciliation
Non-GAAP Reconciliation Q2 and Six Months Non-GAAP Earnings (Loss) Per Share Second Quarter Six Months ($ in millions, except per share amounts) 2017 2016 2017 2016 GAAP Net loss attributable to 3D Systems Corporation ($8.4) ($4.6) ($18.4) ($22.4) Adjustments: Amortization, stock-based compensation
Slide 29: Non-GAAP Reconciliation
Non-GAAP Reconciliation Q2 and Six Months Non-GAAP Operating Expenses Second Quarter Six Months ($ in millions, except per share amounts) 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 $178
Slide 30: Non-GAAP Reconciliation
Non-GAAP Reconciliation Q1 Non-GAAP Earnings (Loss) Per Share First Quarter ($ in millions, except per share amounts) 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-relat
Slide 31: Non-GAAP Reconciliation
Non-GAAP Reconciliation Q1 Non-GAAP Operating Expenses First Quarter ($ in millions, except per share amounts) 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 Adjustments1: Amortization, stock-based compensation & other $ 15.9 $ 20.4 Leg
Slide 32: Thank You
ZN 3D SYSTEMS Thank You