ROCK HILL, S.C., July 30, 2013 (GLOBE NEWSWIRE) -- 3D Systems Corporation (NYSE:DDD) announced today that its second quarter revenue grew 45% from the prior year to $120.8 million on a 108% increase in printers' and other products revenue and 30% overall organic growth resulting in GAAP earnings of $0.10 per share and non-GAAP earnings of $0.20 per share.
Gross profit increased 46% and gross profit margin expanded 40 basis points to 51.8%, contributing to GAAP net income of $9.3 million, and a non-GAAP net income improvement of 36% over the 2012 quarter to $19.0 million.
For the six months 2013, revenue grew 38% to $222.9 million, on an 85% printers and other products revenue increase and 26% organic growth resulting in GAAP earnings of $0.16 per share and non-GAAP earnings of $0.40 per share. Gross profit increased 42% and gross profit margin expanded 140 basis points to 52.1%.
"We are pleased to report record revenue and expanded gross profit margin," said Avi Reichental, 3D Systems' President and Chief Executive Officer. "We believe that our effective advanced manufacturing and consumer growth initiatives are fueling our growth."
3D printers and other products revenue for the second quarter of 2013 more than doubled to $54.2 million primarily on higher professional printer units. Print materials revenue grew $3.1 million over the 2012 quarter to $29.3 million and services revenue rose $6.0 million from 2012 to $37.3 million. Healthcare revenue grew 55% and contributed $18.9 million to our total revenue.
During the second quarter of 2013, the company introduced significant new products including professional 3D printers, advanced 3D print materials and powerful new designer software packages.
"Factoring the significant increase of inbound interest, in the period we made the affirmative decision to step up certain discretionary expenses to accelerate the adoption of our products and services," added Reichental.
The company nearly doubled its R&D expenditures and accelerated its marketing spending over the second quarter of 2012 in support of its near term opportunities and expanding product portfolio and sales channels. The company also increased its manufacturing capacity amidst heavier demand for its products and services.
Notwithstanding higher costs from its strategic R&D and marketing initiatives and the drag from the acquisition of Phenix Systems, the company reiterated its annual guidance for the full year 2013, expecting its revenue to be in the range of $485 million to $510 million and its non-GAAP adjusted earnings per share to be in the range of $1.05 to $1.20.
"We are experiencing heavy demand for our advanced manufacturing and consumer solutions and expect to continue to benefit from accelerated adoption of our products and services that is driven by our customers' robust R&D and manufacturing spending worldwide," concluded Reichental.
Conference Call and Webcast Details
3D Systems will hold a conference call and webcast to discuss its operating results for the second quarter and six months 2013 on Tuesday, July 30, 2013 at 9:00 a.m., Eastern Time.
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To access this webcast, log onto 3D Systems' web site at www.3dsystems.com/investor. To ensure timely participation and technical capability, we recommend logging on a few minutes prior to the conference call to activate your participation.
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To access this conference call, dial 1-877-474-9505 from in the U.S. or 1-857-244-7558 from outside the U.S. and enter participant code 62870047.
- The webcast will be also be available for replay beginning approximately two hours after completion of the call 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.
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, litigation settlements, 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 Corporation
3D Systems is a leading provider of 3D content-to-print solutions including 3D printers, print materials and on-demand custom parts services for professionals and consumers alike. The company also provides affordable CAD modeling, reverse engineering and inspection software tools and consumer 3D printers, apps and services. Its expertly integrated solutions replace and complement traditional methods and reduce the time and cost of designing and manufacturing new products. 3D Systems' products and services are used to rapidly design, communicate, prototype or produce real functional, parts, empowering customers to create and make with confidence.
More information on the company is available at www.3DSystems.com.
Tables Follow
| 3D Systems Corporation | ||||
| Unaudited Consolidated Statements of Operations and Comprehensive Income | ||||
| Quarter and Six Months Ended June 30, 2013 and 2012 | ||||
| Quarter Ended June 30, | Six Months Ended June 30, | |||
| (in thousands, except per share amounts) | 2013 | 2012 | 2013 | 2012 |
| Revenue: | ||||
| Products | $ 83,465 | $ 52,275 | $ 151,917 | $ 101,672 |
| Services | 37,322 | 31,335 | 70,949 | 59,858 |
| Total revenue | 120,787 | 83,610 | 222,866 | 161,530 |
| Cost of sales: | ||||
| Products | 37,215 | 23,845 | 66,960 | 46,892 |
| Services | 20,989 | 16,797 | 39,846 | 32,817 |
| Total cost of sales | 58,204 | 40,642 | 106,806 | 79,709 |
| Gross profit | 62,583 | 42,968 | 116,060 | 81,821 |
| Operating expenses: | ||||
| Selling, general and administrative | 36,189 | 24,048 | 65,643 | 47,998 |
| Research and development | 9,598 | 4,921 | 16,102 | 9,854 |
| Total operating expenses | 45,787 | 28,969 | 81,745 | 57,852 |
| Income from operations | 16,796 | 13,999 | 34,315 | 23,969 |
| Interest and other expense, net | 2,662 | 3,740 | 12,729 | 6,422 |
| Income before income taxes | 14,134 | 10,259 | 21,586 | 17,547 |
| Provision for income taxes | 4,791 | 1,935 | 6,360 | 3,035 |
| Net income | $ 9,343 | $ 8,324 | $ 15,226 | $ 14,512 |
| Other comprehensive income | ||||
| Unrealized gain (loss) on pension obligation | $ (13) | $ 13 | $ 16 | $ 7 |
| Foreign currency translation loss | (2,460) | (3,016) | (5,721) | (1,826) |
| Comprehensive income | $ 6,870 | $ 5,321 | $ 9,521 | $ 12,693 |
| Net income per share — basic | $ 0.10 | $ 0.11 | $ 0.16 | $ 0.19 |
| Net income per share — diluted | $ 0.10 | $ 0.11 | $ 0.16 | $ 0.19 |
| 3D Systems Corporation | ||
| Unaudited Consolidated Balance Sheets | ||
| June 30, 2013 and December 31, 2012 | ||
| June 30, | December 31, | |
| (in thousands, except par value) | 2013 | 2012 |
| ASSETS | ||
| Current assets: | ||
| Cash and cash equivalents | $ 349,255 | $ 155,859 |
| Accounts receivable, net of allowance for doubtful accounts of $6,073 (2013) and $4,317 (2012) | 111,459 | 79,869 |
| Inventories, net | 49,771 | 41,820 |
| Prepaid expenses and other current assets | 4,883 | 4,010 |
| Current deferred income taxes | 6,780 | 5,867 |
| Restricted cash | 13 | 13 |
| Total current assets | 522,161 | 287,438 |
| Property and equipment, net | 36,466 | 34,353 |
| Intangible assets, net | 139,629 | 108,377 |
| Goodwill | 297,938 | 240,314 |
| Long term deferred income taxes | 316 | 107 |
| Other assets, net | 7,855 | 6,853 |
| Total assets | $ 1,004,365 | $ 677,442 |
| LIABILITIES AND EQUITY | ||
| Current liabilities: | ||
| Current portion of capitalized lease obligations | $ 179 | $ 174 |
| Accounts payable | 35,126 | 32,095 |
| Accrued and other liabilities | 29,208 | 24,789 |
| Customer deposits | 4,789 | 2,786 |
| Deferred revenue | 20,848 | 15,309 |
| Total current liabilities | 90,150 | 75,153 |
| Long term portion of capitalized lease obligations | 7,343 | 7,443 |
| Convertible senior notes, net | 24,719 | 80,531 |
| Deferred income tax liability | 22,455 | 23,142 |
| Other liabilities | 10,717 | 10,840 |
| Total liabilities | 155,384 | 197,109 |
| Commitments and Contingencies | ||
| Stockholders' equity: | ||
| Common stock, $0.001 par value, authorized 220,000 shares (2013) and 120,000 (2012); issued 102,174 (2013) and 89,783 (2012) | 102 | 60 |
| Additional paid-in capital | 819,372 | 460,237 |
| Treasury stock, at cost: 561 shares (2013) and 533 shares (2012) | (259) | (240) |
| Accumulated earnings | 31,605 | 16,410 |
| Accumulated other comprehensive income (loss) | (1,839) | 3,866 |
| Total stockholders' equity | 848,981 | 480,333 |
| Total liabilities and stockholders' equity | $ 1,004,365 | $ 677,442 |
| 3D Systems Corporation | ||
| Unaudited Consolidated Statements of Cash Flows | ||
| Six Months Ended June 30, 2013 and 2012 | ||
| Six Months Ended June 30, | ||
| (in thousands) | 2013 | 2012 |
| Cash flows from operating activities: | ||
| Net income | $ 15,226 | $ 14,512 |
| Adjustments to reconcile net income to net cash provided by operating activities: | ||
| Provision for (benefit of) deferred income taxes | (4,481) | 1,301 |
| Depreciation and amortization | 13,328 | 10,678 |
| Non-cash interest on convertible notes | 753 | 1,942 |
| Provision for bad debts | 601 | 904 |
| Stock-based compensation | 5,346 | 2,480 |
| (Gain) loss on the disposition of property and equipment | 3 | (454) |
| Deferred interest income | (1,018) | — |
| Loss on conversion of convertible debt | 9,253 | — |
| Changes in operating accounts: | ||
| Accounts receivable | (26,801) | (4,980) |
| Inventories | (9,900) | (9,453) |
| Prepaid expenses and other current assets | (258) | 20 |
| Accounts payable | 253 | 4,111 |
| Accrued liabilities | 6,654 | 129 |
| Customer deposits | 2,055 | (280) |
| Deferred revenue | 4,069 | 718 |
| Other operating assets and liabilities | (2,290) | (250) |
| Net cash provided by operating activities | 12,793 | 21,378 |
| Cash flows from investing activities: | ||
| Purchases of property and equipment | (3,751) | (1,552) |
| Additions to license and patent costs | (1,313) | (389) |
| Proceeds from disposition of property and equipment | 1,882 | — |
| Cash paid for acquisitions, net of cash assumed | (86,199) | (147,511) |
| Other investing activities | (1,500) | — |
| Net cash used in investing activities | (90,881) | (149,452) |
| Cash flows from financing activities: | ||
| Proceeds from issuance of common stock | 272,081 | 106,912 |
| Proceeds from exercise of stock options and restricted stock, net | 435 | 897 |
| Cash disbursed in lieu of fractional shares related to stock split | (177) | — |
| Repayment of capital lease obligations | (95) | (81) |
| Restricted cash | — | 1 |
| Net cash provided by financing activities | 272,244 | 107,729 |
| Effect of exchange rate changes on cash | (760) | (274) |
| Net increase (decrease) in cash and cash equivalents | 193,396 | (20,619) |
| Cash and cash equivalents at the beginning of the period | 155,859 | 179,120 |
| Cash and cash equivalents at the end of the period | $ 349,255 | $ 158,501 |
| 3D Systems Corporation | ||||
| Schedule 1 | ||||
| Earnings Per Share | ||||
| Quarter Ended June 30, | Six Months Ended June 30, | |||
| (in thousands, except per share amounts) | 2013 | 2012 | 2013 | 2012 |
| Numerator: | ||||
| Net income – numerator for basic net earnings per share | $ 9,343 | $ 8,324 | $ 15,226 | $ 14,512 |
| Add: Effect of dilutive securities | ||||
| Interest expense on 5.50% convertible notes (after-tax)(1) | — | — | — | — |
| Stock options and other equity compensation | — | — | — | — |
| Numerator for diluted earnings per share | $ 9,343 | $ 8,324 | $ 15,226 | $ 14,512 |
| Denominator: | ||||
| Weighted average shares – denominator for basic net earnings per share | 96,248 | 77,669 | 94,047 | 76,572 |
| Add: Effect of dilutive securities | ||||
| Stock options and other equity compensation | — | 1,261 | — | 1,276 |
| 5.50% convertible notes (after-tax)(1) | — | — | — | — |
| Denominator for diluted earnings per share | 96,248 | 78,930 | 94,047 | 77,848 |
| Earnings per share | ||||
| Basic | $ 0.10 | $ 0.11 | $ 0.16 | $ 0.19 |
| Diluted | $ 0.10 | $ 0.11 | $ 0.16 | $ 0.19 |
| Interest expense excluded from diluted earnings per share calculation (1) | $ 511 | $ 2,654 | $ 1,508 | $ 5,262 |
| 5.50% Convertible notes shares excluded from diluted earnings per share calculation (1) | 1,925 | 7,084 | 2,852 | 3,522 |
| (1) Average outstanding diluted earnings per share calculation excludes shares that may be issued upon conversion of the outstanding senior convertible notes since the effect of their inclusion would have been anti-dilutive. | ||||
| 3D Systems Corporation | ||||
| Schedule 2 | ||||
| Unaudited Reconciliation of GAAP Net Income to Non-GAAP Net Income | ||||
| Quarter and Six Months Ended June 30, 2013 and 2012 | ||||
| Quarter Ended June 30, | Six Months Ended June 30, | |||
| (Dollars in thousands, except per share) | 2013 | 2012 | 2013 | 2012 |
| GAAP net income | $ 9,343 | $ 8,324 | $ 15,226 | $ 14,512 |
| Cost of sales adjustments: | ||||
| Amortization of intangibles | 66 | 53 | 125 | 100 |
| Operating expense adjustments: | ||||
| Amortization of intangibles | 5,018 | 2,968 | 8,771 | 6,340 |
| Acquisition and severance expenses | 2,504 | 673 | 4,702 | 3,059 |
| Non-cash stock-based compensation expense | 3,125 | 1,304 | 5,346 | 2,480 |
| Other expense adjustments: | ||||
| Non-cash interest expense | 285 | 983 | 753 | 1,943 |
| Loss on convertible notes | 3,538 | — | 9,253 | — |
| Loss on litigation settlements | — | — | 2,000 | — |
| Tax effect | (4,928) | (358) | (8,375) | (1,308) |
| Non-GAAP net income | $ 18,951 | $ 13,947 | $ 37,801 | $ 27,126 |
| Non-GAAP basic earnings per share | $ 0.20 | $ 0.18 | $ 0.40 | $ 0.35 |
| Non-GAAP diluted earnings per share | $ 0.20 | $ 0.18 | $ 0.40 | $ 0.35 |