LEUVEN, Belgium — (BUSINESS WIRE) — August 7, 2018 — Materialise NV (NASDAQ: MTLS), a leading provider of additive manufacturing and medical software and of sophisticated 3D printing services, today announced its financial results for the second quarter ended June 30, 2018.

Highlights – Second Quarter 2018

• Total revenue increased 34.1% from the second quarter of 2017 to 45,076 kEUR, driven by strong performances in our Materialise Medical segment and in the ACTech business within our Materialise Manufacturing segment, which we acquired in October 2017.
• Total deferred revenue from annual software sales and maintenance contracts increased by 2,419 kEUR to 21,142 kEUR from 18,723 kEUR at year-end 2017.
• Adjusted EBITDA increased 90.9% from 2,732 kEUR for the second quarter of 2017 to 5,216 kEUR.
• Net result was 369 kEUR, or 0.01 EUR per diluted share, compared to (955) kEUR, or (0.02) EUR per diluted share, over the same period last year.

Executive Chairman Peter Leys commented, “The past several months have been an especially exciting period for Materialise. We delivered another set of good results for the second quarter, with particularly strong performances from our Materialise Medical segment and the ACTech business we added to our Materialise Manufacturing segment last October. This performance again demonstrates the benefits of our company’s diversified business model. In July, we announced a collaboration with BASF through which this leading chemicals company has invested US$25 million in Materialise to accelerate the advancement of the 3D printing sector through the development of innovative applications and new materials. We expect this collaboration to create significant new business opportunities in new markets over time. We also raised US$44.85 million in gross proceeds through a successful public offering of ADSs representing our shares, which included the full exercise of the underwriters' over-allotment option to purchase additional ADSs.”

ACTech

On October 4, 2017, we acquired ACTech, a full-service manufacturer of complex metal parts. As described in more detail below, the acquired business has increased the scope of our Materialise Manufacturing segment’s operations and had a significant impact on our results of operations for the second quarter of 2018, resulting in increases to our revenues, operating expenses and net result, among other items.

Second Quarter 2018 Results

Total revenue for the second quarter of 2018 increased 34.1% (1.5% excluding ACTech) to 45,076 kEUR (34,113 kEUR excluding ACTech) compared to 33,612 kEUR for the second quarter of 2017. Total deferred revenue from annual software sales and maintenance contracts amounted to 21,142 kEUR at the end of the second quarter of 2018 compared to 18,723 kEUR at year end 2017. Adjusted EBITDA increased to 5,216 kEUR from 2,732 kEUR primarily as a result of the contribution by ACTech. Excluding ACTech, Adjusted EBITDA increased to 3,245 kEUR. The Adjusted EBITDA margin (Adjusted EBITDA divided by total revenue) in the second quarter of 2018 was 11.6% (9.5% excluding ACTech) compared to 8.1% in the second quarter of 2017.

Revenue from our Materialise Software segment increased 9.9% to 9,131 kEUR for the second quarter of 2018 from 8,305 kEUR for the same quarter last year. Segment EBITDA amounted to 2,859 kEUR compared to 2,952 kEUR in the prior-year period, while the segment EBITDA margin (the segment’s EBITDA divided by the segment’s revenue) was 31.3% compared to 35.5% in the prior-year period.

Revenue from our Materialise Medical segment increased 16.5% to 12,400 kEUR for the second quarter of 2018 compared to 10,646 kEUR for the same period in 2017. Compared to the same quarter in 2017, revenue from our medical software decreased 5.2%. Including deferred revenues from software and maintenance fees, medical software sales increased 8.9%. Revenue from medical devices and services grew 28.8%. Segment EBITDA was 2,124 kEUR compared to 758 kEUR while the segment EBITDA margin increased to 17.1% from 7.1% in the second quarter of 2017.

Revenue from our Materialise Manufacturing segment increased 61.8% to 23,387 kEUR for the second quarter of 2018 from 14,455 kEUR for the second quarter of 2017. Segment EBITDA increased to 2,264 kEUR from 1,241 kEUR while the segment EBITDA margin increased to 9.7% from 8.6% for the same quarter in 2017. ACTech contributed revenue of 10,958 kEUR and segment EBITDA of 1,971 kEUR, with a segment EBITDA margin of 18.0%. Excluding ACTech, revenue decreased 14.0% to 12,429 kEUR and segment EBITDA decreased to 293 kEUR.

Gross profit was 24,788 kEUR, or 55.0% of total revenue, for the second quarter of 2018. Excluding ACTech, gross profit was 21,189 kEUR, or 62.1% of total revenue, compared to 19,388 kEUR, or 57.7% of total revenue, for the second quarter of 2017.

Research and development (“R&D”), sales and marketing (“S&M”) and general and administrative (“G&A”) expenses increased, in the aggregate, 22.9% to 25,700 kEUR for the second quarter of 2018 from 20,911 kEUR for the second quarter of 2017. Excluding ACTech, operating expenses increased, in the aggregate, 10.5% to 23,096 kEUR. Excluding ACTech, R&D expenses increased from 5,131 kEUR to 5,830 kEUR while S&M expenses increased from 10,009 kEUR to 11,038 kEUR and G&A expenses increased from 5,771 kEUR to 6,228 kEUR.