About Proto Labs, Inc.
Proto Labs is a leading online and technology-enabled quick-turn manufacturer of custom parts for prototyping and short-run production. Proto Labs provides “Real Parts, Really Fast” to product developers worldwide. Proto Labs utilizes computer numerical control (CNC) machining, injection molding, and additive manufacturing (3D printing), to manufacture custom parts for our customers. For more information, visit protolabs.com.
Forward-Looking Statements
Statements contained in this press release regarding matters that are not historical or current facts are “forward-looking statements” within the meaning of The Private Securities Litigation Reform Act of 1995. These statements involve known and unknown risks, uncertainties and other factors which may cause the results of Proto Labs to be materially different than those expressed or implied in such statements. Certain of these risk factors and others are described in the “Risk Factors” section within reports filed with the SEC. Other unknown or unpredictable factors also could have material adverse effects on Proto Labs’ future results. The forward-looking statements included in this press release are made only as of the date hereof. Proto Labs cannot guarantee future results, levels of activity, performance or achievements. Accordingly, you should not place undue reliance on these forward-looking statements. Finally, Proto Labs expressly disclaims any intent or obligation to update any forward-looking statements to reflect subsequent events or circumstances.
| Proto Labs, Inc. | ||||||||
| Condensed Consolidated Balance Sheets | ||||||||
| (In thousands) | ||||||||
| September 30, | December 31, | |||||||
| 2014 | 2013 | |||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 34,268 | $ | 43,039 | ||||
| Short-term marketable securities | 24,212 | 36,339 | ||||||
| Accounts receivable, net | 25,460 | 18,320 | ||||||
| Inventory | 5,705 | 5,166 | ||||||
| Other current assets | 7,953 | 6,931 | ||||||
| Total current assets | 97,598 | 109,795 | ||||||
| Property and equipment, net | 87,962 | 56,101 | ||||||
| Long-term marketable securities | 60,449 | 64,023 | ||||||
| Goodwill | 28,916 | - | ||||||
| Other intangible assets, net | 4,269 | - | ||||||
| Other long-term assets | 232 | 256 | ||||||
| Total assets | $ | 279,426 | $ | 230,175 | ||||
| Liabilities and shareholders' equity | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | 7,973 | $ | 6,455 | ||||
| Accrued compensation | 8,154 | 6,196 | ||||||
| Accrued liabilities and other | 3,804 | 808 | ||||||
| Current portion of long-term debt obligations | 164 | 204 | ||||||
|
Total current liabilities |
20,095 | 13,663 | ||||||
| Long-term deferred tax liabilities | 4,112 | 3,682 | ||||||
| Long-term debt obligations | 42 | 159 | ||||||
| Other long-term liabilities | 854 | 1,028 | ||||||
| Shareholders' equity | 254,323 | 211,643 | ||||||
| Total liabilities and shareholders' equity | $ | 279,426 | $ | 230,175 | ||||
| Proto Labs, Inc. | ||||||||||||||||||
| Condensed Consolidated Statements of Operations | ||||||||||||||||||
| (In thousands, except share and per share amounts) | ||||||||||||||||||
| (Unaudited) | ||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||
| September 30, | September 30, | |||||||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||||||
| Revenue | ||||||||||||||||||
| Protomold | $ | 35,655 | $ | 29,534 | $ | 104,604 | $ | 84,338 | ||||||||||
| Firstcut | 15,549 | 12,474 | 43,407 | 34,732 | ||||||||||||||
| Fineline | 3,370 | - | 5,503 | - | ||||||||||||||
| Total revenue | 54,574 | 42,008 | 153,514 | 119,070 | ||||||||||||||
| Cost of revenue | 21,492 | 16,053 | 58,725 | 44,983 | ||||||||||||||
| Gross profit | 33,082 | 25,955 | 94,789 | 74,087 | ||||||||||||||
| Operating expenses | ||||||||||||||||||
| Marketing and sales | 7,351 | 5,409 | 21,029 | 16,222 | ||||||||||||||
| Research and development | 4,555 | 3,026 | 11,925 | 8,405 | ||||||||||||||
| General and administrative | 5,733 | 4,118 | 15,970 | 12,035 | ||||||||||||||
| Total operating expenses | 17,639 | 12,553 | 48,924 | 36,662 | ||||||||||||||
| Income from operations | 15,443 | 13,402 | 45,865 | 37,425 | ||||||||||||||
| Other income (expense), net | (56 | ) | 31 | (19 | ) | 149 | ||||||||||||
| Income before income taxes | 15,387 | 13,433 | 45,846 | 37,574 | ||||||||||||||
| Provision for income taxes | 5,003 | 4,561 | 14,404 | 11,804 | ||||||||||||||
| Net income | $ | 10,384 | $ | 8,872 | $ | 31,442 | $ | 25,770 | ||||||||||
| Net income per share: | ||||||||||||||||||
| Basic | $ | 0.40 | $ | 0.35 | $ | 1.23 | $ | 1.03 | ||||||||||
| Diluted | $ | 0.40 | $ | 0.34 | $ | 1.20 | $ | 1.00 | ||||||||||
| Shares used to compute net income per share: | ||||||||||||||||||
| Basic | 25,757,593 | 25,384,940 | 25,651,156 | 25,121,941 | ||||||||||||||
| Diluted | 26,200,741 | 26,002,240 | 26,109,539 | 25,794,950 | ||||||||||||||
| Proto Labs, Inc. | ||||||||||
| Condensed Consolidated Statements of Cash Flows | ||||||||||
| (In thousands) | ||||||||||
| (Unaudited) | ||||||||||
| Nine Months Ended | ||||||||||
| September 30, | ||||||||||
| 2014 | 2013 | |||||||||
| Operating activities | ||||||||||
| Net income | $ | 31,442 | $ | 25,770 | ||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||
| Depreciation and amortization | 7,696 | 5,528 | ||||||||
| Stock-based compensation expense | 3,561 | 2,595 | ||||||||
| Deferred taxes | 487 | (61 | ) | |||||||
| Excess tax benefit from stock-based compensation | (4,383 | ) | (8,198 | ) | ||||||
| Amortization of held-to-maturity securities | 1,194 | 1,007 | ||||||||
| Loss on disposal of property and equipment | - | 111 | ||||||||
| Changes in operating assets and liabilities | 7 | 8,148 | ||||||||
| Net cash provided by operating activities | 40,004 | 34,900 | ||||||||
| Investing activities | ||||||||||
| Purchases of property and equipment | (35,928 | ) | (12,976 | ) | ||||||
| Acquisitions, net of cash acquired | (33,864 | ) | - | |||||||
| Purchases of marketable securities | (47,338 | ) | (82,657 | ) | ||||||
| Proceeds from sales and maturities of marketable securities | 61,896 | 50,663 | ||||||||
| Net cash used in investing activities | (55,234 | ) | (44,970 | ) | ||||||
| Financing activities | ||||||||||
| Payments on debt | (1,005 | ) | (211 | ) | ||||||
| Acquisition-related contingent consideration | (800 | ) | - | |||||||
| Proceeds from exercises of stock options and other | 3,962 | 4,635 | ||||||||
| Excess tax benefit from stock-based compensation | 4,383 | 8,198 | ||||||||
| Net cash provided by financing activities | 6,540 | 12,622 | ||||||||
| Effect of exchange rate changes on cash and cash equivalents | (81 | ) | 71 | |||||||
| Net increase (decrease) in cash and cash equivalents | (8,771 | ) | 2,623 | |||||||
| Cash and cash equivalents, beginning of period | 43,039 | 36,759 | ||||||||
| Cash and cash equivalents, end of period | $ | 34,268 | $ | 39,382 | ||||||
| Proto Labs, Inc. | ||||||||||
| Reconciliation of GAAP to Non-GAAP Financial Measure | ||||||||||
| (In thousands, except share and per share amounts) | ||||||||||
| (Unaudited) | ||||||||||
| Three Months Ended | Nine Months Ended | |||||||||
| September 30, 2014 | September 30, 2014 | |||||||||
|
Non-GAAP net income, adjusted for stock-based compensation and amortization expenses: |
||||||||||
| GAAP net income | $ | 10,384 | $ | 31,442 | ||||||
| Add back: Stock-based compensation expense | ||||||||||
| Cost of revenue | 103 | 282 | ||||||||
| Marketing and sales | 250 | 685 | ||||||||
| Research and development | 287 | 770 | ||||||||
| General and administrative | 673 | 1,824 | ||||||||
| Total stock-based compensation expense | 1,313 | 3,561 | ||||||||
| Income tax benefits on stock-based compensation expense | (417 | ) | (1,128 | ) | ||||||
| Non-GAAP net income adjusted for stock-based compensation expense | 11,280 | 33,875 | ||||||||
| Add back: Amortization expense | ||||||||||
| General and administrative | 186 | 311 | ||||||||
| Income tax benefits on amortization expense | (65 | ) | (109 | ) | ||||||
|
Non-GAAP net income adjusted for stock-based compensation and amortization expenses |
$ | 11,401 | $ | 34,077 | ||||||
| Non-GAAP net income per share: | ||||||||||
| Basic | $ | 0.44 | $ | 1.33 | ||||||
| Diluted | $ | 0.44 | $ | 1.31 | ||||||
| Shares used to compute non-GAAP net income per share: | ||||||||||
| Basic | 25,757,593 | 25,651,156 | ||||||||
| Diluted | 26,200,741 | 26,109,539 | ||||||||
| Proto Labs, Inc. | ||||||||
| Revenue by Geography - Based on Shipping Location | ||||||||
| (In thousands) | ||||||||
| (Unaudited) | ||||||||
| Three Months Ended | Nine Months Ended | |||||||
| September 30, 2014 | September 30, 2014 | |||||||
| Revenues | ||||||||
| Domestic | ||||||||
| United States | $ | 40,822 | $ | 113,810 | ||||
| International | ||||||||
| Europe | 9,333 | 27,523 | ||||||
| Japan | 1,878 | 5,210 | ||||||
| United States | 2,541 | 6,971 | ||||||
| Total international | 13,752 | 39,704 | ||||||
| Total revenue | $ | 54,574 | $ | 153,514 | ||||
| Proto Labs, Inc. | ||||||||||||||
| Customer Information | ||||||||||||||
| (In thousands, except customer amounts) | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Nine Months Ended September 30, | ||||||||||||||
| 2014 | 2013 | |||||||||||||
| Number of | Number of | |||||||||||||
| Customers | Revenue ($) | Customers | Revenue ($) | |||||||||||
| New customers - Protomold and Firscut | 2,564 | $ | 16,054 | 2,261 | $ | 14,636 | ||||||||
| Existing customers - Protomold and Firscut | 6,154 | 131,957 | 5,315 | 104,434 | ||||||||||
| Total | 8,718 | $ | 148,011 | 7,576 | $ | 119,070 | ||||||||
| Note: the data above does not include customers who purchased Fineline products during the periods presented | ||||||||||||||
| Proto Labs, Inc. | ||||||||||||
| Product Developer Information | ||||||||||||
| (Unaudited) | ||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||
| September 30, | September 30, | |||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||
| Unique product developers served - Protomold and Firscut | 8,680 | 7,308 | 15,942 | 13,421 | ||||||||
| Note: the data above does not include product developers who purchased Fineline products during the periods presented | ||||||||||||
