ROCK HILL, S.C., Aug. 3, 2009 (GLOBE NEWSWIRE) -- 3D Systems Corporation (Nasdaq:TDSC), a leading provider of 3-D Printing, Rapid Prototyping and Manufacturing solutions, announced today its operating results for the second quarter and first six months of 2009.
The company reported improved gross profit margin and reduced net loss for the second quarter of 2009 on lower revenue and lower operating expenses compared to the second quarter of 2008.
The company reduced its net loss by 60% on a 33% revenue decline for the second quarter of 2009 compared to the 2008 quarter, reflecting the positive impact of its cost-control and profit-improvement initiatives. It reported a net loss of $1.3 million, which included $2.1 million of non-cash expenses primarily related to the company's ongoing depreciation and amortization expense.
The company reported that it had improved its cash position for the third consecutive quarter. For the first six months of 2009, it reported that it generated $1.8 million of net cash and finished the period with $24.0 million of available cash compared to $22.2 million at December 31, 2008.
The table below summarizes the company's key financial results for the second quarters and first six months of 2009 and 2008.
Operating Highlights Second Quarters and First Six Months ($ in millions except for per share amounts) ---------------------------------------------------------------------- Second Quarter First Six Months ---------------------------------------------------- % % Change Change Favorable Favorable Operating (Un- (Un- Highlights 2009 2008 favorable) 2009 2008 favorable) ---------------------------------------------------------------------- Revenue $24.7 $36.7 (33%) $48.7 $68.4 (29%) ---------------------------------------------------------------------- Gross profit $10.8 $13.6 (20%) $21.3 $26.3 (19%) % of Revenue 44% 37% 44% 38% ---------------------------------------------------------------------- Operating expenses $11.7 $16.1 28% $23.8 $32.8 28% % of Revenue 47% 44% 49% 48% ---------------------------------------------------------------------- Operating loss ($0.8) ($2.5) 67% ($2.5) ($6.5) 62% ---------------------------------------------------------------------- Net loss ($1.3) ($3.3) 60% ($3.4) ($7.0) 52% ---------------------------------------------------------------------- Diluted loss per share ($0.06) ($0.15) 60% ($0.15) ($0.31) 52% ---------------------------------------------------------------------- Available cash $24.0 $19.1 26% $24.0 $19.1 26% ---------------------------------------------------------------------- Depreciation & Amortization $1.4 $1.8 20% $3.0 $3.1 3% % of Revenue 6% 5% 6% 5% ----------------------------------------------------------------------
"We are pleased that, amidst the continued unprecedented global slowdown that has led to the reduction in our revenue compared with the 2008 periods, sales of our systems and proprietary materials improved during the second quarter sequentially," said Abe Reichental, 3D Systems' President and Chief Executive Officer.
"Notwithstanding the challenging environment in which we are operating, our gross profit margin for the quarter increased and our operating expenses decreased compared to the second quarter of 2008. These improvements have now demonstrated sustainability for three successive quarters," continued Reichental.
Systems' revenue increased sequentially by $1.0 million led by an 89% rebound in large-frame systems but declined to $5.9 million in the second quarter of 2009 from $11.5 million in the 2008 quarter. 3-D Printer sales benefited from the launch of the new V-Flash(r) Desktop Printer and sustained demand for the ProJet(tm) Professional Printer aided in part by continued growth in the dental applications' installed base.
Materials' sales grew by $1.1 million sequentially, indicating a modest recovery across the installed base, but declined some 28% relative to the second quarter of 2008. This decrease was a result of the combined effect of lower demand from service providers and a decline in end-user consumption, reflecting the recessionary business conditions. Sales of integrated materials represented 30% of total materials revenue in the second quarter of 2009.
Service revenue decreased some 20% year over year to $7.1 million for the quarter primarily as a result of a significant drop in maintenance and warranty revenue, reflecting the trailing 12-month cumulative impact of the decline in large-frame systems' revenue that began during the first quarter of 2008. The decrease in service revenue partially reflects the company's continued efforts to improve the profitability of its service revenue by culling less profitable components that resulted in a 22.1 percentage point improvement in Field Service gross profit margin from 15.7% to 37.8%.
Both foreign currency translation and weak global demand, particularly in the automotive sector, negatively impacted revenue in the second quarter of 2009. This negative impact was particularly strong in Japan.
The company ended the quarter with total backlog of approximately $1.6 million, consistent with normal operating trends of its business.
"During the second quarter of 2009, we began commercial shipments of our V-Flash(r) Desktop Printer," added Reichental. "We are very pleased with the initial marketplace reception that this sub-$10,000 3-D Printer is enjoying, particularly within educational and MCAD applications due to its superior speed, part quality and durability. Consistent with our plan, we expect shipments of V-Flash(r) Desktop Printers to increase during the third quarter. Our V-Flash(r) activities during the second quarter negatively affected our total gross profit margin by 2.1 percentage points for the quarter, consistent with our prior comments regarding their anticipated short-term effects. More information on the V-Flash(r) Desktop Printer is available at www.modelin3d.com.
"While the near-term economic outlook remains uncertain, we believe that market conditions may have begun to stabilize and that our revenue decline may have bottomed out during the first quarter of this year.
"We remain committed to our long-term growth objectives and expect to benefit competitively from our new and expanded product portfolio and stronger financial position. Given the progress we have made over the past three quarters, we are confident in our ability to execute on our plan and provide value to our customers and stockholders," concluded Reichental.
Conference Call and Audio Webcast Details
3D Systems will hold a conference call and audio webcast to discuss its operating results for the second quarter and first six months of 2009 on Tuesday, August 4, 2009 at 9:00 a.m., Eastern Time.
* To access this Conference Call, dial 1-888-336-3485 (or 706-634-0653 from outside the United States). The confirmation code is 208-633-98. * To access the audio webcast, log onto 3D Systems' Web site at www.3dsystems.com/ir. To ensure timely participation and technical capability, we recommend logging on a few minutes prior to the conference call to activate your participation. The webcast will be available for replay beginning approximately three hours after completion of the call at: www.3dsystems.com/ir.
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 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.
About 3D Systems Corporation
3D Systems is a leading provider of 3-D Printing, Rapid Prototyping and Manufacturing solutions. Its systems and materials reduce the time and cost of designing products and facilitate direct and indirect manufacturing by creating actual parts directly from digital input. These solutions are used for design communication and prototyping as well as for production of functional end-use parts: Transform your products.
More information on the company is available at www.3dsystems.com, www.modelin3d.com, www.3dsystems.com/3dm, www.3dsystems.com/ir, www.toptobottomdental.com, www.mqast.com, http://blog.3dsystems.com, or via email at moreinfo@3dsystems.com.
The 3D Systems Corporation logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=4537
3D SYSTEMS CORPORATION Condensed Consolidated Statements of Operations Quarters and Six Months Ended June 30, 2009 and 2008 (Unaudited) Quarters Ended Six Months Ended June 30, June 30, (in thousands, except per ------------------ ------------------ share amounts) 2009 2008 2009 2008 -------- -------- -------- -------- Revenue: Products $ 17,584 $ 27,713 $ 33,073 $ 50,478 Services 7,121 8,943 15,663 17,965 -------- -------- -------- -------- Total revenue 24,705 36,656 48,736 68,443 Cost of sales: Products 9,443 15,510 17,380 27,963 Services 4,432 7,541 10,047 14,175 -------- -------- -------- -------- Total cost of sales 13,875 23,051 27,427 42,138 -------- -------- -------- -------- Gross profit 10,830 13,605 21,309 26,305 -------- -------- -------- -------- Operating expenses: Selling, general and administrative 8,818 12,555 18,006 25,619 Research and development 2,855 3,578 5,753 7,175 -------- -------- -------- -------- Total operating expenses 11,673 16,133 23,759 32,794 -------- -------- -------- -------- Operating loss (843) (2,528) (2,450) (6,489) Interest and other expense (income), net 260 485 487 (171) -------- -------- -------- -------- Loss before provision for income taxes (1,103) (3,013) (2,937) (6,318) Provision for income taxes 210 310 460 696 -------- -------- -------- -------- Net loss (1,313) (3,323) (3,397) (7,014) Net income attributable to noncontrolling interest 4 -- 4 -- Net loss attributable to 3D Systems $ (1,317) $ (3,323) $ (3,401) $ (7,014) ======== ======== ======== ======== Shares used to calculate basic and diluted net loss 22,515 22,351 22,442 22,339 ======== ======== ======== ======== Basic and diluted net loss per share(1) $ (0.06) $ (0.15) $ (0.15) $ (0.31) ======== ======== ======== ======== (1) See Schedule 1 for the calculation of basic and diluted net loss per share. 3D SYSTEMS CORPORATION Condensed Consolidated Balance Sheets June 30, 2009 and December 31, 2008 (Unaudited) June 30, December 31, (in thousands) 2009 2008 ------------ ------------ ASSETS Current assets: Cash and cash equivalents $ 24,029 $ 22,164 Accounts receivable, net 16,214 25,276 Inventories, net 19,108 21,018 Prepaid expenses and other current assets 1,866 1,601 Deferred income tax assets 784 935 Restricted cash 107 3,309 ------------ ------------ Total current assets 62,108 74,303 Property and equipment, net 21,990 24,072 Goodwill 47,880 48,010 Other intangible assets, net 3,236 3,663 Other assets, net 3,017 2,954 ------------ ------------ $ 138,231 $ 153,002 ============ ============ LIABILITIES AND EQUITY Current liabilities: Industrial development bonds related to assets held for sale $ -- $ 3,085 Current portion of capitalized lease obligations 203 195 Accounts payable 11,414 17,133 Accrued liabilities 6,941 8,057 Customer deposits 587 1,136 Deferred revenue 8,107 9,418 ------------ ------------ Total current liabilities 27,252 39,024 Long-term portion of capitalized lease obligations 8,364 8,467 Other liabilities 3,364 3,277 ------------ ------------ Total liabilities 38,980 50,768 ------------ ------------ Stockholders' equity: Common stock, authorized 60,000 shares, issued and outstanding 22,698 shares (2009) and 22,424 shares (2008) 23 22 Additional paid-in capital 177,157 176,180 Treasury stock, at cost; 72 shares (2009) and 59 shares (2008) (133) (120) Accumulated deficit in earnings (81,958) (78,557) Accumulated other comprehensive income 4,158 4,709 ------------ ------------ Total 3D Systems stockholders' equity 99,247 102,234 Noncontrolling interest 4 -- ------------ ------------ Total Equity 99,251 102,234 ------------ ------------ $ 138,231 $ 153,002 ============ ============ 3D SYSTEMS CORPORATION Condensed Consolidated Statements of Cash Flows Six Months Ended June 30, 2009 and 2008 (Unaudited) Six Months Ended June 30, ------------------ (in thousands) 2009 2008 -------- -------- Cash flows from operating activities: Net loss attributable to 3D Systems $ (3,401) $ (7,014) Net income attributable to noncontrolling interest 4 -- -------- -------- Net loss (3,397) (7,014) Adjustments to reconcile net loss to net cash provided by (used in) operating activities: Deferred income taxes 140 110 Depreciation and amortization 3,019 3,123 Provision for bad debts 879 287 Stock-based compensation 731 856 Gain on the disposition of property and equipment (21) -- Changes in operating accounts: Accounts receivable 7,725 4,404 Inventories 1,827 (7,589) Prepaid expenses and other current assets (144) 848 Accounts payable (5,335) (1,616) Accrued liabilities (1,161) (2,749) Customer deposits (553) 1,961 Deferred revenue (1,448) (783) Other operating assets and liabilities 55 (219) -------- -------- Net cash provided by (used in) operating activities 2,317 (8,381) -------- -------- Cash flows used in investing activities: Purchases of property and equipment (654) (3,244) Additions to license and patent costs (83) (230) Proceeds from disposition of property and equipment 26 -- -------- -------- Net cash used in investing activities (711) (3,474) -------- -------- Cash flows provided by financing activities: Restricted stock proceeds and stock options, net 232 1,091 Repayment of long-term debt (96) (210) Repayment of short-term borrowings (3,085) -- Restricted cash 3,204 -- -------- -------- Net cash provided by financing activities 255 881 -------- -------- Effect of exchange rate changes on cash 4 394 -------- -------- Net increase (decrease) in cash and cash equivalents 1,865 (10,580) Cash and cash equivalents at the beginning of the period 22,164 29,689 -------- -------- Cash and cash equivalents at the end of the period $ 24,029 $ 19,109 ======== ======== Supplemental Cash Flow Information: Interest payments $ 324 $ 483 Income tax (receipts) payments (480) 408 Non-cash items: Transfer of equipment from inventory to property and equipment 47 3,944 Transfer of equipment to inventory from property and equipment 230 1,518 Schedule 1 (Unaudited) Following is a reconciliation of the numerator and denominator of the basic and diluted net earnings (loss) per share computations: Quarter Ended Six Months Ended June 30, June 30, (in thousands, except per ------------------ ------------------ share amounts) 2009 2008 2009 2008 -------- -------- -------- -------- Basic and diluted earnings (loss) per share: Basic earnings (loss) per share: Numerator: Net loss $ (1,317) $ (3,323) $ (3,401) $ (7,014) ======== ======== ======== ======== Denominator: Weighted average common shares outstanding 22,515 22,351 22,442 22,339 ======== ======== ======== ======== Basic net loss per share $ (0.06) $ (0.15) $ (0.15) $ (0.31) ======== ======== ======== ======== Diluted earnings (loss) per share: Numerator: Net loss $ (1,317) $ (3,323) $ (3,401) $ (7,014) ======== ======== ======== ======== Denominator: Weighted average common shares outstanding 22,515 22,351 22,442 22,339 Effect of dilutive securities: Stock options and restricted stock awards -- -- -- -- -------- -------- -------- -------- Diluted weighted average shares outstanding 22,515 22,351 22,442 22,339 ======== ======== ======== ======== Diluted net loss per share $ (0.06) $ (0.15) $ (0.15) $ (0.31) ======== ======== ======== ========