Stratasys Releases Second Quarter 2020 Financial Results

Use of non-GAAP financial measures

The non-GAAP data included herein, which excludes certain items as described below, are non-GAAP financial measures. Our management believes that these non-GAAP financial measures are useful information for investors and shareholders of our Company in gauging our results of operations on an ongoing basis after (i) excluding mergers, acquisitions and divestments related expense or gains and restructuring-related charges or gains, and (ii) excluding non-cash items such as stock-based compensation expenses, acquired intangible assets amortization, including intangible assets amortization related to equity method investments, impairment of long-lived assets, and the corresponding tax effect of those items. These non-GAAP adjustments either do not reflect actual cash outlays that impact our liquidity and our financial condition or have a non-recurring impact on the statement of operations, as assessed by management. These non-GAAP financial measures are presented to permit investors to more fully understand how management assesses our performance for internal planning and forecasting purposes. The limitations of using these non-GAAP financial measures as performance measures are that they provide a view of our results of operations without including all items indicated above during a period, which may not provide a comparable view of our performance to other companies in our industry. Investors and other readers should consider non-GAAP measures only as supplements to, not as substitutes for or as superior measures to, the measures of financial performance prepared in accordance with GAAP. Reconciliation between results on a GAAP and non-GAAP basis is provided in a table below.

Stratasys Ltd.
Consolidated Balance Sheets
(Unaudited)
(in thousands, except share data)

June 30,

 

December 31,

2020

 

2019

 
 
ASSETS
 
Current assets
Cash and cash equivalents

$

284,742

 

$

293,484

 

Short-term deposits

$

28,300

 

$

28,300

 

Accounts receivable, net

 

102,212

 

 

132,558

 

Inventories

 

164,588

 

 

168,504

 

Prepaid expenses

 

7,056

 

 

6,567

 

Other current assets

 

19,969

 

 

29,659

 

 
Total current assets

 

606,867

 

 

659,072

 

 
Non-current assets
Property, plant and equipment, net

 

194,437

 

 

189,706

 

Goodwill

 

385,636

 

 

385,658

 

Other intangible assets, net

 

75,638

 

 

87,328

 

Operating lease right-of-use assets

 

17,738

 

 

20,936

 

Other non-current assets

 

33,744

 

 

38,819

 

 
Total non-current assets

 

707,193

 

 

722,447

 

 
Total assets

$

1,314,060

 

$

1,381,519

 

 
LIABILITIES AND EQUITY
 
Current liabilities
Accounts payable

$

30,600

 

$

35,818

 

Accrued expenses and other current liabilities

 

23,743

 

 

28,528

 

Accrued compensation and related benefits

 

29,548

 

 

34,013

 

Deferred revenues

 

48,617

 

 

52,268

 

Operating lease liabilities - short term

 

8,667

 

 

9,292

 

 
Total current liabilities

 

141,175

 

 

159,919

 

 
Non-current liabilities
Deferred revenues - long-term

 

13,489

 

 

16,039

 

Operating lease liabilities - long term

 

9,493

 

 

12,445

 

Other non-current liabilities

 

31,576

 

 

35,343

 

 
Total non-current liabilities

 

54,558

 

 

63,827

 

 
Total liabilities

 

195,733

 

 

223,746

 

 
Redeemable non-controlling interests

 

572

 

 

622

 

 
Equity
Ordinary shares, NIS 0.01 nominal value, authorized 180,000 thousands
shares; 55,030 thousands shares and 54,441 thousands shares issued
and outstanding at June 30, 2020 and December 31, 2019, respectively

 

150

 

 

148

 

Additional paid-in capital

 

2,717,963

 

 

2,706,894

 

Accumulated other comprehensive loss

 

(8,494

)

 

(7,716

)

Accumulated deficit

 

(1,591,864

)

 

(1,542,175

)

Total equity

 

1,117,755

 

 

1,157,151

 

 
Total liabilities and equity

$

1,314,060

 

$

1,381,519

 

Stratasys Ltd.
Consolidated Statements of Operations
(in thousands, except per share data)
 

Three Months Ended June 30,

 

Six Months Ended June 30,

2020

 

2019

 

2020

 

2019

(unaudited)

 

(unaudited)

 

(unaudited)

 

(unaudited)

Net sales
Products

$

73,877

 

$

110,341

 

$

157,049

 

$

215,432

 

Services

 

43,746

 

 

52,822

 

 

93,481

 

 

103,031

 

 

117,623

 

 

163,163

 

 

250,530

 

 

318,463

 

 
Cost of sales
Products

 

39,969

 

 

47,095

 

 

79,217

 

 

91,264

 

Services

 

33,918

 

 

34,901

 

 

67,707

 

 

69,575

 

 

73,887

 

 

81,996

 

 

146,924

 

 

160,839

 

 
Gross profit

 

43,736

 

 

81,167

 

 

103,606

 

 

157,624

 

 
Operating expenses
Research and development, net

 

21,303

 

 

24,040

 

 

45,497

 

 

46,614

 

Selling, general and administrative

 

51,711

 

 

56,322

 

 

107,287

 

 

113,476

 

 

73,014

 

 

80,362

 

 

152,784

 

 

160,090

 

 
Operating (loss) income

 

(29,278

)

 

805

 

 

(49,178

)

 

(2,466

)

 
Financial income (expense), net

 

149

 

 

1,754

 

 

(680

)

 

2,508

 

 
Income (loss) before income taxes

 

(29,129

)

 

2,559

 

 

(49,858

)

 

42

 

 
Income tax (benefit) expenses

 

(2,128

)

 

1,280

 

 

(1,907

)

 

2,498

 

 
Share in profits (losses) of associated companies

 

(950

)

 

(195

)

 

(1,788

)

 

1,228

 

 
Net income (loss)

 

(27,951

)

 

1,084

 

 

(49,739

)

 

(1,228

)

 
Net income (loss) attributable to non-controlling interests

 

35

 

 

(68

)

 

(50

)

 

(110

)

 
Net income (loss) attributable to Stratasys Ltd.

$

(27,986

)

$

1,152

 

$

(49,689

)

$

(1,118

)

 
Net income (loss) per ordinary share attributable to Stratasys Ltd.
Basic

$

(0.51

)

$

0.02

 

$

(0.91

)

$

(0.02

)

Diluted

$

(0.51

)

$

0.02

 

$

(0.91

)

$

(0.02

)

 
Basic

 

54,917

 

 

54,231

 

 

54,733

 

 

54,102

 

Diluted

54,917

54,687

54,733

54,102

Three Months Ended June 30,

2020

 

Non-GAAP

 

2020

 

2019

 

Non-GAAP

 

2019

GAAP

 

Adjustments

 

Non-GAAP

 

GAAP

 

Adjustments

 

Non-GAAP

U.S. dollars and shares in thousands (except per share amounts)

 
Gross profit (1)

$

43,736

 

$

9,612

 

$

53,348

 

$

81,167

 

$

4,441

 

$

85,608

Operating income (loss) (1,2)

 

(29,278

)

 

21,228

 

 

(8,050

)

 

(805

)

 

8,246

 

 

9,051

Net income (loss) attributable to Stratasys Ltd. (1,2,3)

 

(27,986

)

 

20,634

 

 

(7,353

)

 

1,152

 

 

7,372

 

 

8,524

Net income (loss) per diluted share attributable to Stratasys Ltd. (4)

$

(0.51

)

$

0.38

 

$

(0.13

)

$

0.02

 

$

0.14

 

$

0.16

 

(1)

Acquired intangible assets amortization expense

 

4,065

 

 

3,900

 

Non-cash stock-based compensation expense

 

497

 

 

541

 

Restructuring and other related costs

 

5,050

 

 

-

 

 

9,612

 

 

4,441

 

 

(2)

Acquired intangible assets amortization expense

 

2,125

 

 

1,783

 

Non-cash stock-based compensation expense

 

5,614

 

 

5,552

 

Restructuring and other related costs

 

3,798

 

 

(3,530

)

Other expenses

 

79

 

 

-

 

 

11,616

 

 

3,805

 

 

21,228

 

 

8,246

 

 

(3)

Corresponding tax effect

 

(669

)

 

(874

)

Equity method related amortization, divestments and impairments

 

75

 

 

-

 

$

20,634

 

$

7,372

 

 

(4)

Weighted average number of ordinary shares outstanding- Diluted

 

54,917

 

 

54,917

 

 

54,687

 

 

54,687

Six Months Ended June 30,

2020

 

Non-GAAP

 

2020

 

2019

 

Non-GAAP

 

2019

GAAP

 

Adjustments

 

Non-GAAP

 

GAAP

 

Adjustments

 

Non-GAAP

U.S. dollars and shares in thousands (except per share amounts)

 
Gross profit (1)

$

103,606

 

$

14,026

 

$

117,632

 

$

157,624

 

$

8,693

 

$

166,317

Operating income (loss) (1,2)

 

(49,178

)

 

32,719

 

 

(16,459

)

 

(2,466

)

 

18,321

 

 

15,855

Net income (loss) attributable to
Stratasys Ltd. (1,2,3)

 

(49,689

)

 

31,771

 

 

(17,919

)

 

(118

)

 

15,299

 

 

14,181

Net income (loss) per diluted share attributable
to Stratasys Ltd. (4)

$

(0.91

)

$

0.58

 

$

(0.33

)

$

(0.02

)

$

0.28

 

$

0.26

 
 
 

(1)

Acquired intangible assets amortization expense

 

8,130

 

 

7,798

 

Non-cash stock-based compensation expense

 

899

 

 

895

 

Restructuring and other related costs

 

4,997

 

 

-

 

 

14,026

 

 

8,693

 

 

(2)

Acquired intangible assets amortization expense

 

4,267

 

 

3,672

 

Non-cash stock-based compensation expense

 

10,119

 

 

9,427

 

Restructuring and other related costs

 

3,829

 

 

(3,471

)

Other expenses

 

478

 

 

-

 

 

18,693

 

 

9,628

 

 

32,719

 

 

18,321

 

 

(3)

Corresponding tax effect

 

(1,100

)

 

(1,418

)

Equity method related amortization, divestments and impairments

 

152

 

 

(1,604

)

$

31,771

 

$

15,299

 

 

(4)

Weighted average number of ordinary shares outstanding- Diluted

 

54,733

 

 

54,733

 

 

54,102

 

 

54,585





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