Financial Tables & Non-GAAP Discussion
The information discussed within this release includes financial results that are in accordance with accounting principles generally accepted in the United States (GAAP). In addition, certain non-GAAP financial measures have been provided that exclude certain charges, expenses and income. The non-GAAP measures should be read in conjunction with the corresponding GAAP measures and should be considered in addition to, and not as an alternative or substitute for, the measures prepared in accordance with GAAP. The non-GAAP financial measures are provided in an effort to provide information that investors may deem relevant to evaluate results from the company’s core business operations and to compare the company’s performance with prior periods. The non-GAAP financial measures primarily identify and exclude certain discrete items, such as the warrant charge, restructuring expenses, and expenses associated with stock-based compensation required under ASC 718. The company uses these non-GAAP financial measures for evaluating comparable financial performance against prior periods.
This release is also available on the Stratasys Web site at www.Stratasys.com.
|
STRATASYS, INC. AND SUBSIDIARIES
|
||||||||||||||||
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
| 2011 | 2010 | 2011 | 2010 | |||||||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||||
| Net sales | ||||||||||||||||
| Products | $ | 32,255,554 | $ | 23,966,937 | $ | 90,521,228 | $ | 69,526,507 | ||||||||
| Services | 7,440,470 | 6,291,609 | 21,048,816 | 18,785,660 | ||||||||||||
| Fair value of warrant related to OEM agreement | - | - | - | (4,987,806 | ) | |||||||||||
| 39,696,024 | 30,258,546 | 111,570,044 | 83,324,361 | |||||||||||||
| Cost of sales | ||||||||||||||||
| Products | 14,868,919 | 12,695,679 | 42,647,905 | 35,805,842 | ||||||||||||
| Services | 3,273,159 | 2,853,879 | 9,382,333 | 8,627,451 | ||||||||||||
| 18,142,078 | 15,549,558 | 52,030,238 | 44,433,293 | |||||||||||||
| Gross profit | 21,553,946 | 14,708,988 | 59,539,806 | 38,891,068 | ||||||||||||
|
|
|
|||||||||||||||
| Operating expenses | ||||||||||||||||
| Research and development | 3,613,668 | 2,242,263 | 10,687,578 | 7,191,594 | ||||||||||||
| Selling, general and administrative | 10,083,451 | 8,403,902 | 28,738,326 | 24,385,683 | ||||||||||||
| 13,697,119 | 10,646,165 | 39,425,904 | 31,577,277 | |||||||||||||
| Operating income | 7,856,827 | 4,062,823 | 20,113,902 | 7,313,791 | ||||||||||||
| Other income (expense) | ||||||||||||||||
| Interest income, net | 276,089 | 217,651 | 698,469 | 596,541 | ||||||||||||
| Foreign currency transaction losses, net | (217,857 | ) | 227,623 | (429,840 | ) | (570,184 | ) | |||||||||
| Other, net | 755,030 | 48,078 | 2,264,307 | 42,093 | ||||||||||||
| 813,262 | 493,352 | 2,532,936 | 68,450 | |||||||||||||
| Income before income taxes | 8,670,089 | 4,556,175 | 22,646,838 | 7,382,241 | ||||||||||||
| Income tax expense | 2,812,920 | 1,380,625 | 7,806,524 | 2,317,635 | ||||||||||||
| Net income | $ | 5,857,169 | $ | 3,175,550 | $ | 14,840,314 | $ | 5,064,606 | ||||||||
| Earnings per common share | ||||||||||||||||
| Basic | $ | 0.28 | $ | 0.15 | $ | 0.70 | $ | 0.25 | ||||||||
| Diluted | $ | 0.27 | $ | 0.15 | $ | 0.68 | $ | 0.24 | ||||||||
|
Weighted average number of common shares outstanding |
||||||||||||||||
| Basic | 21,165,401 | 20,586,695 | 21,107,474 | 20,519,189 | ||||||||||||
| Diluted | 21,542,674 | 21,000,804 | 21,669,848 | 21,035,559 | ||||||||||||
|
STRATASYS, INC. AND SUBSIDIARIES
|
||||||||
|
September 30,
2011 (unaudited) |
December 31,
2010 |
|||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 15,231,778 | $ | 27,554,411 | ||||
| Short-term investments - held to maturity | 3,047,213 | 8,797,878 | ||||||
|
Accounts receivable, less allowance for doubtful accounts of $1,154,709 at September 30, 2011 and $1,094,588 at December 31, 2010 |
23,766,474 | 20,051,451 | ||||||
| Inventories | 21,983,920 | 17,880,714 | ||||||
|
Net investment in sales-type leases, less allowance for doubtful accounts of $245,332 at September 30, 2011 and $189,338 at December 31, 2010 |
2,911,027 | 3,096,911 | ||||||
| Prepaid expenses and other current assets | 4,660,515 | 3,384,394 | ||||||
| Deferred income taxes | 3,826,000 | 3,447,000 | ||||||
| Total current assets | 75,426,927 | 84,212,759 | ||||||
| Property and equipment, net | 37,828,246 | 29,872,945 | ||||||
| Other assets | ||||||||
| Goodwill | 25,055,948 | 867,700 | ||||||
| Other Intangible assets, net | 25,930,787 | 5,538,014 | ||||||
| Net investment in sales-type leases | 4,274,110 | 3,067,446 | ||||||
| Long-term investments - available for sale | - | 1,185,250 | ||||||
| Long-term investments - held to maturity | 42,652,402 | 52,504,650 | ||||||
| Other non-current assets | 172,490 | 1,210,867 | ||||||
| Total other assets | 98,085,737 | 64,373,927 | ||||||
| Total assets | $ | 211,340,910 | $ | 178,459,631 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable and other current liabilities | $ | 15,499,809 | $ | 14,408,628 | ||||
| Unearned revenues | 12,266,830 | 11,561,521 | ||||||
| Total current liabilities | 27,766,639 | 25,970,149 | ||||||
| Non-current liabilities | ||||||||
| Deferred tax liabilities | 7,519,500 | 207,000 | ||||||
| Total liabilities | 35,286,139 | 26,177,149 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders' equity | ||||||||
|
Common stock, $.01 par value, authorized 30,000,000 shares; 26,857,801 and 26,509,518 issued as of September 30, 2011 and December 31, 2010, respectively |
268,578 | 265,095 | ||||||
| Additional paid-in capital | 116,544,175 | 107,781,990 | ||||||
| Retained earnings | 98,225,797 | 83,385,484 | ||||||
| Accumulated other comprehensive loss | 20,646 | (145,662 | ) | |||||
|
Treasury stock at cost, 5,687,631 shares as of September 30, 2011 and December 31, 2010 |
(39,004,425 | ) | (39,004,425 | ) | ||||
| Total stockholders' equity | 176,054,771 | 152,282,482 | ||||||
| Total liabilities and stockholders' equity | $ | 211,340,910 | $ | 178,459,631 | ||||
|
STRATASYS, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP TO GAAP RESULTS OF OPERATIONS |
|||||||||||||||||||||||||||||||||||||||
| Non-GAAP Adjustments for the Three Months Ended September 30, 2011 | Non-GAAP Adjustments for the Three Months Ended September 30, 2010 | ||||||||||||||||||||||||||||||||||||||
|
Consolidated
(unaudited) As Reported |
Stock-Based
Compensation (1) |
Sale of Auction
Rate Security (2) |
Consolidated
(unaudited) Non-GAAP |
Consolidated
(unaudited) As Reported |
Stock-Based
Compensation (1) |
Consolidated
(unaudited) Non-GAAP |
|||||||||||||||||||||||||||||||||
| Gross profit | 21,553,946 | - | - | 21,553,946 | 14,708,988 | - | 14,708,988 | ||||||||||||||||||||||||||||||||
| Selling, general and administrative expenses | 10,083,451 | (440,829 | ) | - | 9,642,622 | 8,403,902 | (310,544 | ) | 8,093,358 | ||||||||||||||||||||||||||||||
| Total operating expenses | 13,697,119 | (440,829 | ) | - | 13,256,290 | 10,646,165 | (310,544 | ) | 10,335,621 | ||||||||||||||||||||||||||||||
| Operating income | 7,856,827 | 440,829 | - | 8,297,656 | 4,062,823 | 310,544 | 4,373,367 | ||||||||||||||||||||||||||||||||
| Other income | 813,262 | - | (626,188 | ) | 187,074 | 493,352 | - | 493,352 | |||||||||||||||||||||||||||||||
| Income before income taxes | 8,670,089 | 440,829 | (626,188 | ) | 8,484,730 | 4,556,175 | 310,544 | 4,866,719 | |||||||||||||||||||||||||||||||
| Income tax expense | 2,812,920 | 95,585 | (232,253 | ) | 2,676,252 | 1,380,625 | 48,288 | 1,428,913 | |||||||||||||||||||||||||||||||
| Net income | $ | 5,857,169 | $ | 345,244 | $ | (393,935 | ) | $ | 5,808,478 | $ | 3,175,550 | $ | 262,256 | $ | 3,437,806 | ||||||||||||||||||||||||
| Earnings per common share | |||||||||||||||||||||||||||||||||||||||
| Basic | $ | 0.28 | $ | 0.02 | $ | (0.02 | ) | $ | 0.27 | $ | 0.15 | $ | 0.01 | $ | 0.17 | ||||||||||||||||||||||||
| Diluted | $ | 0.27 | $ | 0.02 | $ | (0.02 | ) | $ | 0.27 | $ | 0.15 | $ | 0.01 | $ | 0.16 | ||||||||||||||||||||||||
|
Weighted average number of common shares outstanding |
|||||||||||||||||||||||||||||||||||||||
| Basic | 21,165,401 | 21,165,401 | 20,586,695 | 20,586,695 | |||||||||||||||||||||||||||||||||||
| Diluted | 21,542,674 | 21,542,674 | 21,000,804 | 21,000,804 | |||||||||||||||||||||||||||||||||||
| Non-GAAP Adjustments for the Nine Months Ended September 30, 2011 | Non-GAAP Adjustments for the Nine Months Ended September 30, 2010 | ||||||||||||||||||||||||||||||||||||||
|
Consolidated
(unaudited) As Reported |
Stock-Based
Compensation (1) |
Sale of Auction
Rate Security (2) |
Sale of Equity
Investment (3) |
Solidscape
Acquisition (4) |
Solidscape
Inventory Revaluation (5) |
Consolidated
(unaudited) Non-GAAP |
Consolidated
(unaudited) As Reported |
Stock-Based
Compensation (1) |
Fair Value
of Warrant (6) |
Consolidated
(unaudited) Non-GAAP |
|||||||||||||||||||||||||||||
| Net sales | $ | 111,570,044 | $ | - | $ | - | $ | - | $ | - | $ | - | $ | 111,570,044 | $ | 83,324,361 | $ | - | $ | 4,987,806 | $ | 88,312,167 | |||||||||||||||||
| Cost of sales | 52,030,238 | - | - | - | - | (561,094 | ) | 51,469,144 | 44,433,293 | - | - | 44,433,293 | |||||||||||||||||||||||||||
| Gross profit | 59,539,806 | - | - | - | - | 561,094 | 60,100,900 | 38,891,068 | - | 4,987,806 | 43,878,874 | ||||||||||||||||||||||||||||
| Selling, general and administrative expenses | 28,738,326 | (1,088,025 | ) | - | - | (615,332 | ) | - | 27,034,969 | 24,385,683 | (931,632 | ) | - | 23,454,051 | |||||||||||||||||||||||||
| Total operating expenses | 39,425,904 | (1,088,025 | ) | - | - | (615,332 | ) | - | 37,722,547 | 31,577,277 | (931,632 | ) | - | 30,645,645 | |||||||||||||||||||||||||
| Operating income | 20,113,902 | 1,088,025 | - | - | 615,332 | 561,094 | 22,378,353 | 7,313,791 | 931,632 | 4,987,806 | 13,233,229 | ||||||||||||||||||||||||||||
| Other income | 2,532,936 | - | (626,188 | ) | (1,204,408 | ) | - | - | 702,340 | 68,450 | - | - | 68,450 | ||||||||||||||||||||||||||
| Income before income taxes | 22,646,838 | 1,088,025 | (626,188 | ) | (1,204,408 | ) | 615,332 | 561,094 | 23,080,693 | 7,382,241 | 931,632 | 4,987,806 | 13,301,679 | ||||||||||||||||||||||||||
| Income tax expense | 7,806,524 | 383,481 | (232,253 | ) | (506,655 | ) | 128,812 | 208,110 | 7,788,019 | 2,317,635 | 257,408 | 1,796,510 | 4,371,553 | ||||||||||||||||||||||||||
| Net income | $ | 14,840,314 | $ | 704,544 | $ | (393,935 | ) | $ | (697,753 | ) | $ | 486,520 | $ | 352,984 | $ | 15,292,674 | $ | 5,064,606 | $ | 674,224 | $ | 3,191,296 | $ | 8,930,126 | |||||||||||||||
| Earnings per common share | |||||||||||||||||||||||||||||||||||||||
| Basic | $ | 0.70 | $ | 0.03 | $ | (0.02 | ) | $ | (0.03 | ) | $ | 0.02 | $ | 0.02 | $ | 0.72 | $ | 0.25 | $ | 0.03 | $ | 0.16 | $ | 0.44 | |||||||||||||||
| Diluted | $ | 0.68 | $ | 0.03 | $ | (0.02 | ) | $ | (0.03 | ) | $ | 0.02 | $ | 0.02 | $ | 0.71 | $ | 0.24 | $ | 0.03 | $ | 0.15 | $ | 0.42 | |||||||||||||||
|
Weighted average number of common shares outstanding |
|||||||||||||||||||||||||||||||||||||||
| Basic | 21,107,474 | 21,107,474 | 20,519,189 | 20,519,189 | |||||||||||||||||||||||||||||||||||
| Diluted | 21,669,848 | 21,669,848 | 21,035,559 | 21,035,559 | |||||||||||||||||||||||||||||||||||
| These adjustments reconcile the Company’s GAAP results of operations to its non-GAAP results of operations. The Company believes that presentation of results adjusted for the non-GAAP items described below provides meaningful supplemental information to both management and investors. |
| (1) - Represents non-cash stock-based compensation expense. |
| (2) - Represents gain on sale of an auction rate security during the third quarter of 2011. |
| (3) - Represents gain on sale of an equity investment during the first quarter of 2011. |
| (4) - Represents expenses for the acquisition of Solidscape, Inc. during the second quarter of 2011. |
|
(5) - Represents the revaluation of Solidscape, Inc. inventory at the time of acquisition. |
| (6) - Represents the fair value of a warrant issued during the first quarter of 2010 in connection with the Hewlett-Packard Company OEM agreement. |
| The Company considers these non-GAAP measures to be indicative of its core operating results and facilitates a comparison of operating results across reporting periods. The Company uses these non-GAAP measures when evaluating its financial results as well as for internal planning and forecasting purposes, however these measures should not be viewed as a substitute for the Company’s GAAP results. |
