The ExOne Company Reports 2020 Second Quarter Results
-
Revenue of
$11.1 million for Q2 2020; includes recurring revenue growth of 3% year-on-year -
Record backlog of
$38.2 million increased 13% sequentially and 65% year-on-year, indicating continued market strength of binder jetting technology -
Total liquidity increased to
$29.7 million
“ExOne’s global team continued to perform admirably despite challenging market conditions as a result of COVID-19,” said
Recently,
Q2 2020 Revenue Summary |
||||||||||||
Three Months Ended |
||||||||||||
(in millions) |
|
|||||||||||
Revenue by Product Line |
2020 |
2019 |
||||||||||
3D Printing Machines |
$ |
4.9 |
44 |
% |
$ |
9.3 |
60 |
% |
||||
3D Printed and Other Products, Materials and Services |
|
6.2 |
56 |
% |
|
6.0 |
40 |
% |
||||
Total Revenue |
$ |
11.1 |
100 |
% |
$ |
15.3 |
100 |
% |
Q2 2020 Financial Results Summary
The following summarizes ExOne’s financial results for the second quarter ended
-
Revenue was
$11.1 million , compared to$15.3 million in last year’s second quarter. The revenue decline resulted from a 47% decrease in revenue attributable to 3D printing machines driven by lower volumes (eight units sold in the current quarter versus 13 in the prior year period) and an unfavorable mix of machines sold. This decrease was partially offset by a 3% increase in revenue attributable to 3D printed and other products, materials and services driven by funded research and development contracts. Revenue for both product groups were impacted by COVID-19, including disruptions to domestic and international shipping and travel in addition to the negative macroeconomic effects. - Gross margin was 27.8%, compared to 33.7% in the second quarter of 2019. The decrease was primarily due to lower revenue volumes, partially offset by lower fixed overhead costs, which were driven by cost actions taken and other reductions realized as a result of COVID-19.
-
Research and development expenses were
$2.4 million , compared to$2.5 million in the second quarter of 2019. The decrease was primarily due to lower employee-related costs resulting from actions taken in response to COVID-19. Investments remain focused on the further development of binder jetting technology, including the X1 160Pro production metal 3D printing system. -
Selling, general and administrative expenses were
$4.5 million , compared to$6.2 million for the second quarter of 2019. This decrease was driven by a combination of factors including lower trade show expenses and cost reductions associated with COVID-19, as well as lower equity-based compensation. -
Net loss was
$4.0 million , or$0.24 per fully diluted share, compared with a net loss of$3.8 million , or$0.23 per fully diluted share, in the second quarter of 2019. -
Adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”), a non-GAAP measure, was a loss of
$2.4 million , compared with a loss of$1.7 million in the second quarter of 2019. Refer to the attached table captioned “Adjusted EBITDA Reconciliation” for important disclosures regarding the Company’s definition and use of Adjusted EBITDA as well as a reconciliation of net loss (the most directly comparable measure under accounting principles generally accepted inthe United States (“GAAP”)) to Adjusted EBITDA.ExOne management believes that, when used in conjunction with other measures prepared in accordance with GAAP, Adjusted EBITDA assists in the understanding of its financial results. -
Cash, cash equivalents and restricted cash as of
June 30, 2020 increased to$20.2 million , from$17.3 million atMarch 31, 2020 . The increase was driven by cash inflows from financing activities of$5.6 million , including$2.9 million in sales of common stock in at-the-market offerings and$2.2 million in proceeds from a federal COVID-19 loan program. Offsetting this were cash outflows from operations of$2.6 million mostly due to the widening of net loss, net of noncash items for the period. Working capital remained generally balanced as inflows from customers approximated the Company’s investment in inventories for future deliveries against its backlog. -
Total liquidity, which includes unrestricted cash and cash equivalents and availability under the Company’s related party revolving credit facility, increased to
$29.7 million atJune 30, 2020 compared to$26.8 million atMarch 31, 2020 . There were no borrowings outstanding under the Company’s$10.0 million related party revolving credit facility atJune 30, 2020 .
Outlook
Webcast and Conference Call
A telephonic replay of the conference call will be available from
About
Safe Harbor Regarding Forward Looking Statements
This news release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act with respect to the Company’s future financial or business performance, strategies, or expectations. Forward-looking statements typically are identified by words or phrases such as “trend,” “potential,” “opportunity,” “pipeline,” “believe,” “comfortable,” “expect,” “anticipate,” “current,” “intention,” “estimate,” “position,” “assume,” “outlook,” “continue,” “remain,” “maintain,” “sustain,” “seek,” “achieve,” as well as similar expressions, or future or conditional verbs such as “will,” “would,” “should,” “could” and “may.”
The Company cautions that forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made and the Company assumes no duty to and does not undertake to update forward-looking statements. Actual results could differ materially from those anticipated in forward-looking statements and future results could differ materially from historical performance.
In addition to risk factors previously disclosed in the Company’s filings with the
These and other important factors, including those discussed under Item 1A, “Risk Factors” and Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report on Form 10-K, and under Part II, Item 1A, “Risk Factors” and Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Quarterly Reports on Form 10-Q for the quarters ended
FINANCIAL TABLES FOLLOW.
|
||||||||||||||||
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
|
|||||||||||||||
2020 |
2019 |
2020 |
2019 |
|||||||||||||
Revenue |
$ |
11,099 |
|
$ |
15,279 |
|
$ |
24,482 |
|
$ |
24,858 |
|
||||
Cost of sales |
|
8,009 |
|
|
10,137 |
|
|
17,763 |
|
|
17,074 |
|
||||
Gross profit |
|
3,090 |
|
|
5,142 |
|
|
6,719 |
|
|
7,784 |
|
||||
Operating expenses | ||||||||||||||||
Research and development |
|
2,369 |
|
|
2,537 |
|
|
4,845 |
|
|
4,969 |
|
||||
Selling, general and administrative |
|
4,488 |
|
|
6,167 |
|
|
10,651 |
|
|
11,590 |
|
||||
Gain from sale-leaseback of property and equipment |
|
— |
|
|
— |
|
|
(1,462 |
) |
|
— |
|
||||
|
6,857 |
|
|
8,704 |
|
|
14,034 |
|
|
16,559 |
|
|||||
Loss from operations |
|
(3,767 |
) |
|
(3,562 |
) |
|
(7,315 |
) |
|
(8,775 |
) |
||||
Other expense | ||||||||||||||||
Interest expense |
|
53 |
|
|
71 |
|
|
117 |
|
|
142 |
|
||||
Other expense – net |
|
195 |
|
|
57 |
|
|
5 |
|
|
69 |
|
||||
|
248 |
|
|
128 |
|
|
122 |
|
|
211 |
|
|||||
Loss before income taxes |
|
(4,015 |
) |
|
(3,690 |
) |
|
(7,437 |
) |
|
(8,986 |
) |
||||
Provision (benefit) for income taxes |
|
8 |
|
|
99 |
|
|
234 |
|
|
(701 |
) |
||||
Net loss |
$ |
(4,023 |
) |
$ |
(3,789 |
) |
$ |
(7,671 |
) |
$ |
(8,285 |
) |
||||
Net loss per common share: | ||||||||||||||||
Basic |
$ |
(0.24 |
) |
$ |
(0.23 |
) |
$ |
(0.47 |
) |
$ |
(0.51 |
) |
||||
Diluted |
$ |
(0.24 |
) |
$ |
(0.23 |
) |
$ |
(0.47 |
) |
$ |
(0.51 |
) |
||||
Comprehensive loss: | ||||||||||||||||
Net loss |
$ |
(4,023 |
) |
$ |
(3,789 |
) |
$ |
(7,671 |
) |
$ |
(8,285 |
) |
||||
Other comprehensive income (loss): | ||||||||||||||||
Foreign currency translation adjustments |
|
370 |
|
|
583 |
|
|
(468 |
) |
|
(193 |
) |
||||
Comprehensive loss |
$ |
(3,653 |
) |
$ |
(3,206 |
) |
$ |
(8,139 |
) |
$ |
(8,478 |
) |
|
||||||||
|
|
|||||||
2020 |
2019 |
|||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents |
$ |
19,658 |
|
$ |
5,265 |
|
||
Restricted cash |
|
508 |
|
|
978 |
|
||
Accounts receivable – net |
|
4,531 |
|
|
6,522 |
|
||
Current portion of net investment in sales-type leases |
|
292 |
|
|
213 |
|
||
Inventories – net |
|
24,208 |
|
|
19,770 |
|
||
Prepaid expenses and other current assets |
|
3,510 |
|
|
2,182 |
|
||
Total current assets |
|
52,707 |
|
|
34,930 |
|
||
Property and equipment – net |
|
20,609 |
|
|
38,895 |
|
||
Operating lease right-of-use assets |
|
4,533 |
|
|
432 |
|
||
Net investment in sales-type leases – net of current portion |
|
639 |
|
|
738 |
|
||
Other noncurrent assets |
|
242 |
|
|
371 |
|
||
Total assets |
$ |
78,730 |
|
$ |
75,366 |
|
||
Liabilities | ||||||||
Current liabilities: | ||||||||
Current portion of long-term debt |
$ |
1,128 |
|
$ |
153 |
|
||
Current portion of operating lease liabilities |
|
1,754 |
|
|
158 |
|
||
Accounts payable |
|
5,127 |
|
|
5,818 |
|
||
Accrued expenses and other current liabilities |
|
4,183 |
|
|
6,942 |
|
||
Current portion of contract liabilities |
|
16,438 |
|
|
11,846 |
|
||
Total current liabilities |
|
28,630 |
|
|
24,917 |
|
||
Long-term debt – net of current portion |
|
2,354 |
|
|
1,211 |
|
||
Operating lease liabilities – net of current portion |
|
2,779 |
|
|
274 |
|
||
Contract liabilities – net of current portion |
|
213 |
|
|
286 |
|
||
Other noncurrent liabilities |
|
223 |
|
|
96 |
|
||
Total liabilities |
|
34,199 |
|
|
26,784 |
|
||
Contingencies and commitments | ||||||||
Stockholders' equity | ||||||||
Common stock, |
|
169 |
|
|
163 |
|
||
Additional paid-in capital |
|
180,932 |
|
|
176,850 |
|
||
Accumulated deficit |
|
(124,619 |
) |
|
(116,948 |
) |
||
Accumulated other comprehensive loss |
|
(11,951 |
) |
|
(11,483 |
) |
||
Total stockholders' equity |
|
44,531 |
|
|
48,582 |
|
||
Total liabilities and stockholders' equity |
$ |
78,730 |
|
$ |
75,366 |
|
|
||||||||
Six Months Ended |
||||||||
|
||||||||
2020 |
2019 |
|||||||
Operating activities | ||||||||
Net loss |
$ |
(7,671 |
) |
$ |
(8,285 |
) |
||
Adjustments to reconcile net loss to net cash used for operations: | ||||||||
Depreciation |
|
2,107 |
|
|
2,349 |
|
||
Equity-based compensation |
|
449 |
|
|
1,081 |
|
||
Amortization of debt issuance costs |
|
29 |
|
|
47 |
|
||
Recoveries for bad debts – net |
|
(19 |
) |
|
(150 |
) |
||
Provision for slow-moving, obsolete and lower of cost or net realizable value inventories – net |
|
305 |
|
|
131 |
|
||
Foreign exchange (gains) losses on intercompany transactions – net |
|
(51 |
) |
|
19 |
|
||
Gain from sale-leaseback of property and equipment |
|
(1,462 |
) |
|
— |
|
||
Gain from disposal of property and equipment – net |
|
(1 |
) |
|
(2 |
) |
||
Deferred income taxes |
|
195 |
|
|
— |
|
||
Changes in assets and liabilities, excluding effects of foreign currency translation adjustments: | ||||||||
Decrease in accounts receivable |
|
2,016 |
|
|
1,879 |
|
||
Decrease in net investment in sales-type leases |
|
20 |
|
|
153 |
|
||
Increase in inventories |
|
(5,369 |
) |
|
(1,325 |
) |
||
Increase in prepaid expenses and other assets |
|
(1,034 |
) |
|
(221 |
) |
||
(Decrease) increase in accounts payable |
|
(821 |
) |
|
927 |
|
||
Decrease in accrued expenses and other liabilities |
|
(458 |
) |
|
(1,689 |
) |
||
Increase in contract liabilities |
|
4,428 |
|
|
3,608 |
|
||
Net cash used for operating activities |
|
(7,337 |
) |
|
(1,478 |
) |
||
Investing activities | ||||||||
Capital expenditures |
|
(591 |
) |
|
(423 |
) |
||
Proceeds from sale of property and equipment |
|
16,229 |
|
|
3 |
|
||
Net cash provided by (used for) investing activities |
|
15,638 |
|
|
(420 |
) |
||
Financing activities | ||||||||
Proceeds from borrowings on long-term debt |
|
2,194 |
|
|
— |
|
||
Payments on long-term debt |
|
(78 |
) |
|
(74 |
) |
||
Proceeds from at-the-market offerings of common stock, net of issuance costs |
|
2,894 |
|
|
— |
|
||
Proceeds from exercise of employee stock options |
|
541 |
|
|
171 |
|
||
Other |
|
(29 |
) |
|
(75 |
) |
||
Net cash provided by financing activities |
|
5,522 |
|
|
22 |
|
||
Effect of exchange rate changes on cash, cash equivalents, and restricted cash |
|
100 |
|
|
(12 |
) |
||
Net change in cash, cash equivalents, and restricted cash |
|
13,923 |
|
|
(1,888 |
) |
||
Cash, cash equivalents, and restricted cash at beginning of period |
|
6,243 |
|
|
9,140 |
|
||
Cash, cash equivalents, and restricted cash at end of period |
$ |
20,166 |
|
$ |
7,252 |
|
||
Supplemental disclosure of noncash investing and financing activities | ||||||||
Transfer of internally developed 3D printing machines from inventories to property and equipment for internal use or leasing activities |
$ |
1,834 |
|
$ |
1,066 |
|
||
Transfer of internally developed 3D printing machines from property and equipment to inventories for sale |
$ |
1,107 |
|
$ |
182 |
|
||
Property and equipment included in accounts payable |
$ |
41 |
|
$ |
110 |
|
||
Property and equipment included in accrued expenses and other current liabilities |
$ |
— |
|
$ |
48 |
|
||
Unsettled proceeds from at-the-market offerings of common stock, net of issuance costs |
$ |
204 |
|
$ |
— |
|
||
Unsettled proceeds from exercise of employee stock options |
$ |
— |
|
$ |
91 |
|
|
||||||||||||||||
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
|
|||||||||||||||
2020 |
2019 |
2020 |
2019 |
|||||||||||||
Net loss |
$ |
(4.0 |
) |
$ |
(3.8 |
) |
$ |
(7.7 |
) |
$ |
(8.3 |
) |
||||
Interest expense |
|
0.0 |
|
|
0.1 |
|
|
0.1 |
|
|
0.1 |
|
||||
Provision (benefit) for income taxes |
|
0.0 |
|
|
0.1 |
|
|
0.3 |
|
|
(0.7 |
) |
||||
Depreciation |
|
1.2 |
|
|
1.2 |
|
|
2.1 |
|
|
2.4 |
|
||||
Equity-based compensation |
|
0.2 |
|
|
0.6 |
|
|
0.5 |
|
|
1.1 |
|
||||
Gain from sale-leaseback of property and equipment |
|
0.0 |
|
|
0.0 |
|
|
(1.5 |
) |
|
0.0 |
|
||||
Other expense – net |
|
0.2 |
|
|
0.1 |
|
|
0.0 |
|
|
0.1 |
|
||||
Adjusted EBITDA |
$ |
(2.4 |
) |
$ |
(1.7 |
) |
$ |
(6.2 |
) |
$ |
(5.3 |
) |
The Company believes that Adjusted EBITDA is meaningful to its investors to enhance their understanding of ExOne’s financial results. Although Adjusted EBITDA is not necessarily a measure of the Company’s ability to fund its cash needs, the Company understands that it is frequently used by securities analysts, investors and other interested parties as a measure of financial performance and to compare ExOne’s performance with the performance of other companies that report Adjusted EBITDA. ExOne’s calculation of Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies.
View source version on businesswire.com: https://www.businesswire.com/news/home/20200806005948/en/
Chief Financial Officer and Treasurer
(724) 765-1331
douglas.zemba@exone.com
Investor Relations/The
(212) 871-3927
investor.relations@exone.com
Source: