Shapeways Reports Fourth Quarter and Year End 2021 Results

Non-GAAP Financial Information

In addition to Shapeways’ results determined in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), Shapeways believes that Adjusted EBITDA, a non-U.S. GAAP financial measure, is useful in evaluating our operational performance. Shapeways uses this non-U.S. GAAP financial information to evaluate our ongoing operations and for internal planning and forecasting purposes. Shapeways believes that this non-U.S. GAAP financial information, when taken collectively, may be helpful to investors in assessing our operating performance.

Shapeways defines Adjusted EBITDA as net income (loss) excluding debt forgiveness, interest expense, net of interest income, income tax benefit, depreciation and amortization, stock-based compensation, change in fair value of warrant liabilities, and other non-operating gains and losses.

Shapeways believes that the use of Adjusted EBITDA provides an additional tool for investors to use in evaluating ongoing operating results and trends because it eliminates the effect of financing and capital expenditures and provides investors with a means to compare its financial measures with those of comparable companies, which may present similar non-U.S. GAAP financial measures to investors. However, you should be aware that when evaluating Adjusted EBITDA Shapeways may incur future expenses similar to those excluded when calculating these measures. In addition, Shapeways’ presentation of these measures should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items.

Because of these limitations, Adjusted EBITDA should not be considered in isolation or as a substitute for performance measures calculated in accordance with U.S. GAAP. Shapeways compensates for these limitations by relying primarily on our U.S. GAAP results and using Adjusted EBITDA on a supplemental basis. You should review the reconciliation of net income (loss) to Adjusted EBITDA below and not rely on any single financial measure to evaluate Shapeways’ business.

BALANCE SHEET As of December 31, 2021 and December 31, 2020

	December 31,
		2021			2020

Assets
Current assets
Cash and cash equivalents	$	79,677		$	8,564
Restricted cash		142			145
Accounts receivable		1,372			185
Inventory		927			727
Promissory note due from related party		—			151
Prepaid expenses and other current assets		4,360			1,910
Total current assets		86,478			11,682
Property and equipment, net		4,388			948
Right-of-use assets, net		842			2,102
Goodwill		1,835			1,835
Security deposits		175			175
Total assets	$	93,718		$	16,742
Liabilities and Stockholders' Equity (Deficit)
Current liabilities
Accounts payable	$	1,909		$	1,633
Accrued expenses and other liabilities		2,645			3,319
Current portion of long-term debt		—			8,332
Operating lease liabilities, current		639			1,222
Deferred revenue		921			753
Total current liabilities		6,114			15,259
Operating lease liabilities, net of current portion		326			1,094
Warrant liabilities		2,274			—
Long-term debt		—			2,236
Total liabilities		8,714			18,589
Commitments and contingencies
Stockholders' equity (deficit)
Preferred stock ($0.0001 par value; 10,000,000 shares authorized; none issued and outstanding as of December 31, 2021 and 2020, respectively)		—			—
Common stock ($0.0001 par value; 120,000,000 shares authorized; 48,627,739 and 32,184,263 shares issued and outstanding as of December 31, 2021 and 2020, respectively)		5			3
Additional paid-in capital		198,179			112,994
Accumulated deficit		(112,811	)		(114,567	)
Accumulated other comprehensive loss		(369	)		(277	)
Total stockholders' equity (deficit)		85,004			(1,847	)
Total liabilities and stockholders' equity (deficit)	$	93,718		$	16,742

STATEMENT OF OPERATIONS Twelve Months Ended December 31, 2021 and 2020

	Year Ended December 31,
		2021			2020
Revenue, net	$	33,623		$	31,775
Cost of revenue		17,673			17,903
Gross profit		15,950			13,872
Operating expenses
Selling, general and administrative		17,561			10,752
Research and development		6,281			5,592
Amortization and depreciation		133			149
Total operating expenses		23,975			16,493
Loss from operations		(8,025	)		(2,621	)
Other income (expense)
Long-term debt forgiveness		2,000			—
Change in fair value of warrant liabilities		8,106			—
Interest expense		(404	)		(582	)
Interest income		1			1
Other income		7			9
Loss on disposal of assets		—			(4	)
Total other income (expense), net		9,710			(576	)
Income (loss) before income tax benefit		1,685			(3,197	)
Income tax benefit		(71	)		(29	)
Net income (loss)		1,756			(3,168	)
Deemed dividend - Earnout Shares		(18,132	)		—
Net loss attributable to common stockholders	$	(16,376	)	$	(3,168	)
Net income (loss) per share:
Basic	$	0.04		$	(0.09	)
Diluted	$	0.04		$	(0.09	)
Net loss per share attributable to common stockholders:
Basic	$	(0.40	)	$	(0.09	)
Diluted	$	(0.40	)	$	(0.09	)
Weighted average common shares outstanding:
Basic		41,040,637			35,713,913
Diluted		41,040,637			35,713,913
Other comprehensive (loss) income
Foreign currency translation adjustment		(92	)		83
Comprehensive loss	$	(16,468	)	$	(3,085	)

STATEMENT OF CASH FLOWS For the Twelve Months Ended December 31, 2021 and 2020

	Year Ended December 31,
		2021			2020
Cash flows from operating activities:
Net income (loss)	$	1,756		$	(3,168	)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization		593			473
Loss on disposal of assets		—			4
Stock-based compensation expense		2,907			721
Non-cash lease expense		763			2,056
Non-cash debt forgiveness		(2,000	)		—
Change in fair value of warrant liabilities		(8,106	)		—
Change in operating assets and liabilities:
Accounts receivable		(1,180	)		(40	)
Inventory		(175	)		(310	)
Prepaid expenses and other assets		(2,355	)		(5	)
Interest on promissory note due from related party		—			49
Security deposits		—			259
Accounts payable		207			(379	)
Accrued expenses and other liabilities		223			814
Lease liabilities		(854	)		(2,129	)
Deferred revenue		162			345
Deferred rent		—			(283	)
Net cash used in operating activities		(8,059	)		(1,593	)
Cash flows from investing activities:
Purchases of property and equipment		(3,960	)		(104	)
Net cash used in investing activities		(3,960	)		(104	)
Cash flows from financing activities:
Principal payments on capital leases		—			(18	)
Proceeds from issuance of common stock		595			86
Proceeds received from exercise of preferred stock warrants		60			—
Tax payments related to shares withheld for vested restricted stock units		(594	)		—
Effect of Merger, net of transaction costs		86,792			—
Repayments of loans payable		(3,586	)		(1,318	)
Proceeds from loans payable		—			1,982
Net cash provided by financing activities		83,267			732
Net change in cash and cash equivalents and restricted cash	$	71,248		$	(965	)
Effect of change in foreign currency exchange rates on cash and cash equivalents and restricted cash		(138	)		69
Cash and cash equivalents and restricted cash at beginning of year		8,709			9,605
Cash and cash equivalents and restricted cash at end of year	$	79,819		$	8,709
Supplemental disclosure of cash and non-cash transactions:
Cash paid for interest	$	85		$	182
Issuance of Legacy Shapeways common stock upon conversion of convertible notes	$	5,913		$	—
Repurchase of Legacy Shapeways common stock	$	(152	)	$	—

RECONCILIATION OF GAAP TO NON-GAAP MEASURES For the Three and Twelve Months Ended December 31, 2021 and 2020


	Three Months Ended December 31,
(Dollars in thousands)		2021			2020
Net income (loss)	$	(2,369	)	$	(237	)
Debt forgiveness		-			-
Interest expense, net		-			138
Depreciation and amortization		169			110
Stock-based compensation		2,125			177
Change in fair value of warrant liabilities		(3,019	)		-
Income tax benefit		-			(29	)
Other		(7	)		25
Adjusted EBITDA	$	(3,101	)	$	184

	Year Ended December 31,
(Dollars in thousands)		2021			2020
Net income (loss)	$	1,756		$	(3,168	)
Debt forgiveness		(2,000	)		—
Interest expense, net		403			581
Depreciation and amortization		593			473
Stock-based compensation		2,907			721
Change in fair value of warrant liabilities		(8,106	)		—
Income tax benefit		(71	)		(29	)
Other		15			30
Adjusted EBITDA	$	(4,503	)	$	(1,392	)

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