ROCK HILL, S.C., March 14, 2016 (GLOBE NEWSWIRE) -- 3D Systems Corporation (NYSE:DDD) announced today its financial results for the fourth quarter and full year ended December 31, 2015.
For the fourth quarter of 2015, the company reported revenue of $183.4 million, a decrease of 2% over the comparable quarter in 2014. The company reported a GAAP loss of $5.32 per share and non-GAAP earnings of $0.19 per share.
“While market conditions remain challenging and uncertain, timing of healthcare and industrial customer orders as well as contributions from acquisitions supported revenue during the quarter,” commented Andrew Johnson, Interim President & Chief Executive Officer and Chief Legal Officer, 3D Systems.
Gross profit margin for the fourth quarter of 2015 was 32.8%, primarily as a result of a $27.4 million charge related to inventory and purchase commitments in connection with the company’s end-of-life of the Cube 3D printer and shift away from consumer products. Excluding the negative impact of this charge, gross profit margin was 47.7%, a decrease of 20 basis points from the fourth quarter of 2014.
For the fourth quarter of 2015, cash operating expenses of $66.7 million remained flat sequentially. Total operating expenses for the quarter were $626.1 million, including a $537.2 million goodwill and intangibles impairment charge. Excluding the impairment charge, operating expenses were $88.9 million inclusive of $22.4 million of R&D expense and $66.5 million of SG&A expense.
The company reported a fourth quarter GAAP net loss of $596.4 million, or a $5.32 loss per share. The company reported non-GAAP income of $20.9 million, or $0.19 earnings per share.
The company generated $7.5 million of cash for operations during the quarter and used $3.1 million during the full year. The company had $155.6 million of cash on hand at the end of December.
For the full year 2015, revenue grew 2% to $666.2 million, resulting in a GAAP loss of $5.85 per share and non-GAAP earnings of $0.27 per share.
“We believe that by leveraging our domain expertise, partner and customer relationships and advanced technology we are well positioned to capitalize on meaningful opportunities in key verticals,” continued Johnson. “We are continuing an extensive and comprehensive review of our business and strategy and taking steps to better prioritize our resources and focus our investments.”
Q4 Conference Call and Webcast
The company expects to file its 2015 annual report on Form 10-K with the Securities and Exchange Commission on March 14, 2016. 3D Systems plans to hold a conference call and simultaneous webcast to discuss these results on Monday, March 14, 2016, at 8:30 a.m. Eastern Time.
Date: Monday, March 14, 2016
Time: 8:30 a.m. Eastern Time
Listen via Internet: www.3dsystems.com/investor
Participate via telephone:
Within the U.S.: 1-877-407-8291
Outside the U.S.: 1-201-689-8345
The recorded webcast will be available beginning approximately two hours after the live presentation at www.3dsystems.com/investor.
Forward-Looking Statements
Certain statements made in this release 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 may involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the company to be materially different from historical results or from any future results or projections expressed or implied by such forward-looking statements. In addition to statements that explicitly describe such risks and uncertainties, readers are urged to consider statements in the conditional or future tenses or that include terms such as “believes,” “belief,” “expects,” “estimates,” “intends,” “anticipates” or “plans” to be uncertain and forward-looking. Forward-looking statements may include comments as to the company’s beliefs and expectations as to future events and trends affecting its business and are necessarily subject to uncertainties, many of which are outside the control of the company. The factors described under the headings “Forward-Looking Statements,” “Cautionary Statements and Risk Factors,” and “Risk Factors” in the company’s periodic filings with the Securities and Exchange Commission, as well as other factors, could cause actual results to differ materially from those reflected or predicted in forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. 3D Systems undertakes no obligation to update or revise any forward-looking statements, even if experience or future changes make it clear that projected results expressed or implied in such statements will not be realized, except as may be required by law.
Presentation of Information in This Press release
To facilitate a better understanding of the impact that several strategic acquisitions had on its financial results, the company reported non-GAAP measures that adjust net income and earnings per share by excluding the impact of amortization of intangibles, non-cash interest expense, acquisition and severance expenses, an arbitration award related to litigation, loss on conversion of notes and stock-based compensation expense. A reconciliation of GAAP to non-GAAP results is provided in the accompanying schedule.
About 3D Systems
3D Systems provides comprehensive 3D products and services, including 3D printers, print materials, on-demand manufacturing services and digital design tools. Its ecosystem supports advanced applications from the product design shop to the factory floor to the operating room. 3D Systems’ precision healthcare capabilities include simulation, Virtual Surgical Planning, and printing of medical and dental devices as well as patient-specific surgical instruments. As the originator of 3D printing and a shaper of future 3D solutions, 3D Systems has spent its 30 year history enabling professionals and companies to optimize their designs, transform their workflows, bring innovative products to market and drive new business models.
More information on the company is available at www.3dsystems.com
Tables Follow
| 3D Systems Corporation | ||||||||||||||||||||
| Unaudited Condensed Consolidated Statements of Operations and | ||||||||||||||||||||
| Comprehensive Income (Loss) | ||||||||||||||||||||
| Quarter and Year Ended December 31, 2015 and 2014 | ||||||||||||||||||||
| Quarter Ended December 31, | Year Ended December 31, | |||||||||||||||||||
| (in thousands, except per share amounts) | 2015 | 2014 | 2015 | 2014 | ||||||||||||||||
| Revenue: | ||||||||||||||||||||
| Products | $ | 115,973 | $ | 129,094 | $ | 408,119 | $ | 442,198 | ||||||||||||
| Services | 67,390 | 58,344 | 258,044 | 211,454 | ||||||||||||||||
| Total revenue | 183,363 | 187,438 | 666,163 | 653,652 | ||||||||||||||||
| Cost of sales: | ||||||||||||||||||||
| Products | 87,207 | 68,316 | 243,639 | 223,991 | ||||||||||||||||
| Services | 35,996 | 29,356 | 130,715 | 112,227 | ||||||||||||||||
| Total cost of sales | 123,203 | 97,672 | 374,354 | 336,218 | ||||||||||||||||
| Gross profit | 60,160 | 89,766 | 291,809 | 317,434 | ||||||||||||||||
| Operating expenses: | ||||||||||||||||||||
| Selling, general and administrative | 66,542 | 63,026 | 303,784 | 215,724 | ||||||||||||||||
| Research and development | 22,360 | 22,512 | 92,770 | 75,395 | ||||||||||||||||
| Impairment of goodwill and other intangible assets | 537,179 | — | 537,179 | — | ||||||||||||||||
| Total operating expenses | 626,081 | 85,538 | 933,733 | 291,119 | ||||||||||||||||
| Income (loss) from operations | (565,921 | ) | 4,228 | (641,924 | ) | 26,315 | ||||||||||||||
| Interest and other expense, net | 9,000 | 2,449 | 13,029 | 8,928 | ||||||||||||||||
| Income (loss) before income taxes | (574,921 | ) | 1,779 | (654,953 | ) | 17,387 | ||||||||||||||
| Provision for income taxes | 29,535 | 75 | 8,972 | 5,441 | ||||||||||||||||
| Net income (loss) | (604,456 | ) | 1,704 | (663,925 | ) | 11,946 | ||||||||||||||
| Less net income (loss) attributable to noncontrolling interests | (8,090 | ) | 153 | (8,433 | ) | 309 | ||||||||||||||
| Net income (loss) attributable to 3D Systems Corporation | $ | (596,366 | ) | $ | 1,551 | $ | (655,492 | ) | $ | 11,637 | ||||||||||
| Net income (loss) per share available to 3D Systems Corporation common stockholders — basic and diluted | $ | (5.32 | ) | $ | 0.01 | $ | (5.85 | ) | $ | 0.11 | ||||||||||
| Other comprehensive income (loss): | ||||||||||||||||||||
| Pension adjustments, net of taxes | $ | 62 | $ | (1,271 | ) | $ | 338 | $ | (1,135 | ) | ||||||||||
| Foreign currency gain (loss) | 1,603 | (19,920 | ) | (16,300 | ) | (29,183 | ) | |||||||||||||
| Total other comprehensive income (loss) | 1,665 | (21,191 | ) | (15,962 | ) | (30,318 | ) | |||||||||||||
| Less foreign currency translation gain (loss) attributable to noncontrolling interests | 1,768 | (52 | ) | (820 | ) | (123 | ) | |||||||||||||
| Other comprehensive income (loss) attributable to 3D Systems Corporation | (103 | ) | (21,139 | ) | (15,142 | ) | (30,195 | ) | ||||||||||||
| Comprehensive income (loss) | (602,791 | ) | (19,487 | ) | (679,887 | ) | (18,372 | ) | ||||||||||||
| Less comprehensive income (loss) attributable to noncontrolling interests | (6,322 | ) | 101 | (9,253 | ) | 186 | ||||||||||||||
| Comprehensive income (loss) attributable to 3D Systems Corporation | $ | (596,469 | ) | $ | (19,588 | ) | $ | (670,634 | ) | $ | (18,558 | ) | ||||||||
| 3D Systems Corporation | |||||||||||
| Unaudited Condensed Consolidated Balance Sheets | |||||||||||
| December 31, 2015 and December 31, 2014 | |||||||||||
| December 31, | December 31, | ||||||||||
| (in thousands, except par value) | 2015 | 2014 | |||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 155,643 | $ | 284,862 | |||||||
| Accounts receivable, net of reserves of $14,139 (2015) and $10,300 (2014) | 157,406 | 168,441 | |||||||||
| Inventories, net of reserves of $28,225 (2015) and $6,675 (2014) | 105,877 | 96,645 | |||||||||
| Prepaid expenses and other current assets | 13,541 | 15,769 | |||||||||
| Current deferred income tax asset | — | 14,973 | |||||||||
| Total current assets | 432,467 | 580,690 | |||||||||
| Property and equipment, net | 85,995 | 81,881 | |||||||||
| Intangible assets, net | 157,466 | 251,561 | |||||||||
| Goodwill | 187,875 | 589,537 | |||||||||
| Long term deferred income tax asset | 3,216 | 816 | |||||||||
| Other assets, net | 26,256 | 25,825 | |||||||||
| Total assets | $ | 893,275 | $ | 1,530,310 | |||||||
| LIABILITIES AND EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Current portion of debt and capitalized lease obligations | $ | 529 | $ | 684 | |||||||
| Accounts payable | 46,869 | 64,378 | |||||||||
| Accrued and other liabilities | 54,699 | 43,554 | |||||||||
| Customer deposits | 8,229 | 6,946 | |||||||||
| Deferred revenue | 35,145 | 32,264 | |||||||||
| Total current liabilities | 145,471 | 147,826 | |||||||||
| Long term portion of capitalized lease obligations | 8,187 | 8,905 | |||||||||
| Long term deferred income tax liability | 17,944 | 30,679 | |||||||||
| Other liabilities | 58,155 | 39,903 | |||||||||
| Total liabilities | 229,757 | 227,313 | |||||||||
| Redeemable noncontrolling interests | 8,872 | 8,872 | |||||||||
| Stockholders’ equity: | |||||||||||
| Common stock, $0.001 par value, authorized 220,000 shares; issued 113,115 (2015) and 112,233 (2014) | 113 | 112 | |||||||||
| Additional paid-in capital | 1,279,738 | 1,245,462 | |||||||||
| Treasury stock, at cost: 892 shares (2015) and 709 shares (2014) | (1,026 | ) | (374 | ) | |||||||
| Accumulated earnings (deficit) | (583,368 | ) | 72,124 | ||||||||
| Accumulated other comprehensive loss | (39,548 | ) | (24,406 | ) | |||||||
| Total 3D Systems Corporation stockholders' equity | 655,909 | 1,292,918 | |||||||||
| Noncontrolling interests | (1,263 | ) | 1,207 | ||||||||
| Total stockholders’ equity | 654,646 | 1,294,125 | |||||||||
| Total liabilities, redeemable noncontrolling interests and stockholders’ equity | $ | 893,275 | $ | 1,530,310 | |||||||
| 3D Systems Corporation | ||||||||||
| Unaudited Condensed Consolidated Statements of Cash Flows | ||||||||||
| Year Ended December 31, 2015 and 2014 | ||||||||||
| Year Ended December 31, | ||||||||||
| (in thousands) | 2015 | 2014 | ||||||||
| Cash flows from operating activities: | ||||||||||
| Net income (loss) | $ | (663,925 | ) | $ | 11,946 | |||||
| Adjustments to reconcile net income (loss) to net cash provided (used) by operating activities: | ||||||||||
| Benefit of deferred income taxes | (2,875 | ) | (24,555 | ) | ||||||
| Depreciation and amortization | 83,069 | 55,188 | ||||||||
| Provision for litigation award | 11,282 | — | ||||||||
| Impairment of goodwill, other intangible assets and investments | 544,611 | — | ||||||||
| Non-cash interest on convertible notes | — | 224 | ||||||||
| Provision for bad debts | 3,766 | 8,699 | ||||||||
| Provision for inventory obsolescence and revaluation | 21,550 | 2,334 | ||||||||
| Stock-based compensation | 34,733 | 32,793 | ||||||||
| (Gain) loss on the disposition of property and equipment | (43 | ) | (227 | ) | ||||||
| Loss on conversion of convertible debt | — | 1,806 | ||||||||
| Changes in operating accounts: | ||||||||||
| Accounts receivable | 20,890 | (55,977 | ) | |||||||
| Inventories | (31,241 | ) | (33,088 | ) | ||||||
| Prepaid expenses and other current assets | 2,197 | (9,235 | ) | |||||||
| Accounts payable | (18,904 | ) | 23,482 | |||||||
| Accrued and other liabilities | 624 | 15,406 | ||||||||
| Customer deposits | 1,466 | 1,921 | ||||||||
| Deferred revenue | (576 | ) | 8,686 | |||||||
| Other operating assets and liabilities | (9,752 | ) | 11,708 | |||||||
| Net cash provided by (used in) operating activities | (3,128 | ) | 51,111 | |||||||
| Cash flows from investing activities: | ||||||||||
| Purchases of property and equipment | (22,399 | ) | (22,727 | ) | ||||||
| Additions to license and patent costs | (907 | ) | (753 | ) | ||||||
| Cash paid for acquisitions, net of cash assumed | (91,799 | ) | (345,361 | ) | ||||||
| Other investing activities | (5,750 | ) | (6,600 | ) | ||||||
| Net cash used in investing activities | (120,855 | ) | (375,441 | ) | ||||||
| Cash flows from financing activities: | ||||||||||
| Tax benefits (provision) from share-based payment arrangements | (1,243 | ) | 7,653 | |||||||
| Proceeds from issuance of common stock | — | 299,729 | ||||||||
| Proceeds from exercise of restricted stock, net | 135 | 1,896 | ||||||||
| Repayment of capital lease obligations | (1,049 | ) | (696 | ) | ||||||
| Net cash provided by (used in) financing activities | (2,157 | ) | 308,582 | |||||||
| Effect of exchange rate changes on cash | (3,079 | ) | (5,706 | ) | ||||||
| Net increase (decrease) in cash and cash equivalents | (129,219 | ) | (21,454 | ) | ||||||
| Cash and cash equivalents at the beginning of the period | 284,862 | 306,316 | ||||||||
| Cash and cash equivalents at the end of the period | $ | 155,643 | $ | 284,862 | ||||||
| 3D Systems Corporation | ||||||||||||||||
| Schedule 1 | ||||||||||||||||
| Earnings (Loss) Per Share | ||||||||||||||||
| Year Ended December 31, 2015 and 2014 | ||||||||||||||||
| Quarter Ended December 31, | Year Ended December 31, | |||||||||||||||
| (in thousands, except per share amounts) | 2015 | 2014 | 2015 | 2014 | ||||||||||||
| Numerator for basic and diluted net earnings per share: | ||||||||||||||||
| Net income (loss) attributable to 3D Systems Corporation | $ | (596,366 | ) | $ | 1,551 | $ | (655,492 | ) | $ | 11,637 | ||||||
| Denominator for basic and diluted net earnings per share: | ||||||||||||||||
| Weighted average shares | 112,115 | 111,287 | 111,969 | 108,023 | ||||||||||||
| Earnings (loss) per share, basic and diluted | $ | (5.32 | ) | $ | 0.01 | $ | (5.85 | ) | $ | 0.11 | ||||||
| Restricted stock units excluded from diluted earnings per share calculation(a) | 88 | — | 270 | — | ||||||||||||
| (a) Average outstanding diluted earnings (loss) per share calculation excludes restricted stock units since the effect of their inclusion would have been anti-dilutive. | ||||||||||||||||
| 3D Systems Corporation | |||||||||||||||||||||||
| Schedule 2 | |||||||||||||||||||||||
| Unaudited Reconciliation of GAAP Net Income (Loss) to Non-GAAP Net Income | |||||||||||||||||||||||
| Quarter and Year Ended December 31, 2015 and 2014 | |||||||||||||||||||||||
| Quarter Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||
| (in thousands, except per share amounts) | 2015 | 2014 | 2015 | 2014 | |||||||||||||||||||
| GAAP net income (loss) attributable to 3D Systems Corporation | $ | (596,366 | ) | $ | 1,551 | $ | (655,492 | ) | $ | 11,637 | |||||||||||||
| Cost of sales adjustments: | |||||||||||||||||||||||
| Amortization of intangibles | 71 | 72 | 303 | 281 | |||||||||||||||||||
| Charges related to shift away from consumer products and services — cash | 8,771 | — | 8,771 | — | |||||||||||||||||||
| Charges related to shift away from consumer products and services — non-cash | 18,619 | — | 18,619 | — | |||||||||||||||||||
| Operating expense adjustments: | |||||||||||||||||||||||
| Amortization of intangibles | 13,155 | 10,892 | 60,763 | 39,193 | |||||||||||||||||||
| Acquisition and severance expenses | 3,409 | 3,158 | 9,274 | 7,994 | |||||||||||||||||||
| Impairment of goodwill and other intangible assets | 537,179 | — | 537,179 | — | |||||||||||||||||||
| Non-cash stock-based compensation expense | 5,883 | 9,055 | 34,733 | 32,793 | |||||||||||||||||||
| Arbitration award | — | — | 11,282 | — | |||||||||||||||||||
| Interest and other expense adjustments: | |||||||||||||||||||||||
| Non-cash interest expense | — | — | — | 225 | |||||||||||||||||||
| Loss on convertible notes | — | — | — | 1,806 | |||||||||||||||||||
| Tax effect (a) | 30,160 | (971 | ) | 4,578 | (18,810 | ) | |||||||||||||||||
| Non-GAAP net income | $ | 20,881 | $ | 23,757 | $ | 30,010 | $ | 75,119 | |||||||||||||||
| Non-GAAP basic and diluted earnings per share | $ | 0.19 | $ | 0.21 | $ | 0.27 | $ | 0.70 | |||||||||||||||
| (a) tax effect is calculated quarterly, based on the actual tax rate for each quarter. | |||||||||||||||||||||||