Business News
Stratasys Reports Record First Quarter Financial Results
Wednesday 04. May 2011 - Fortus System Sales Expand by 60% in Q1
Stratasys, Inc. (NASDAQ:SSYS) today announced first quarter financial results.
The company reported record revenue of $34.3 million for the first quarter ended March 31, 2011, versus $23.0 million reported for the same period in 2010. The first quarter of last year included a $5.0 million one-time non-cash charge against revenue, representing the fair value of a warrant issued to HP (NYSE: HPQ) for 500,000 shares of Stratasys, Inc. common stock, in connection with the distribution agreement signed in January 2010.
The first quarter revenue of $34.3 million represented a 23% increase over the non-GAAP revenue of $28.0 million for the same period in 2010, which excludes the warrant charge. System shipments for the first quarter totaled 567 units versus 610 units for the same period last year.
The company reported net income of $5.0 million for the first quarter or $0.23 per share compared to a net loss of $443,000 or $0.02 per share for the same period last year.
Non-GAAP net income, which excludes certain discrete items and stock-based compensation expense, was $4.4 million or $0.21 per share, for the first quarter of 2011, a 54% increase compared to the non-GAAP net income of $2.9 million or $0.14 per share for the same period last year.
Non-GAAP net income for the first quarter of 2011 excludes the impact of a one-time gain of $698,000 net of tax, or $0.03 per share, associated with the sale of an investment. Non-GAAP net income for the first quarter of 2011 also excludes the impact of stock-based compensation expense, which amounted to $147,000 net of tax, or $0.01 per share.
Non-GAAP net income for the first quarter of 2010 excludes the warrant charge which amounted to $3.2 million net of tax, or $0.16 per share. Non-GAAP net income for the first quarter of 2010 also excludes the impact of stock-based compensation expense which amounted to $150,000 net of tax, or $0.01 per share.
Appropriate reconciliations between GAAP and non-GAAP financial measures are provided in a table at the end of this press release. The table provides itemized detail of the non-GAAP financial measures.
“The strong first quarter results reflect a continuation of the positive trends we have observed over the past year, as demand for our products has strengthened,” said Scott Crump, chairman and chief executive officer of Stratasys. “Sales of our Fortus 3D production systems expanded by 60% over last year, driven by the demand for direct digital manufacturing applications. In addition, strong growth in our higher-margin products contributed to a significant increase in gross margin both sequentially and year-over-year.
“Revenue from consumables, our highest margin product, grew by 36% during the first quarter over last year, the fastest quarterly growth rate in over four years. This growth is being driven by a significant acceleration in customer usage, as well as from our growing installed base of systems. We are optimistic that this growth can continue given the positive trends within our markets and our expectation of continued growth in our installed base.
“We continue to make progress in our game-changing agreement with HP. Unit sales of 3D printers into markets served by HP experienced strong growth during the first quarter, increasing by 49% over the products sold in those same markets last year. We are now looking forward to additional collaboration and the possible expansion into new European countries later this year. We remain confident that HPs distribution capabilities combined with their brand and marketing muscle can drive increased awareness and accelerated adoption of our proprietary 3D printers.
“Fortus system sales represented the fastest growing part of our business during the first quarter. New DDM applications remain the drivers behind this growth. Applications for aircraft repair and maintenance, as well as the production of fabrication tools to aid in manufacturing continue to be notable areas of expansion for our line of Fortus systems.
“We bolstered our DDM strategy this week with the acquisition of Solidscape, a leading provider of 3D printers targeting applications for investment casting and mold making. Solidscapes 3D printers are marketed worldwide and are known for the production of highly-castable wax parts with fine feature detail and smooth surface finish.
“The $38 million purchase of Solidscape will open new DDM markets for Stratasys, including jewelry, dental and industrial casting applications that require high precision. While Solidscape is the leading provider of systems for jewelry manufacturers, we see significant opportunities to develop their products beyond their core market. Additional information on the Solidscape acquisition can be found by accessing the link provided at the end of our first quarter press release.
“We remain pleased with the positive trends in our business during the first quarter and are optimistic regarding the balance of 2011. While we expect the acquisition of Solidscape will have a modest near-term positive impact on earnings, we are more excited about the longer-term potential of adding their product line and developing their technology for new DDM applications.
“We maintain a healthy balance sheet even with our acquisition of Solidscape, and we continue to generate significant cash from operations. And finally, we remain confident that our agreement with HP can significantly expand the sales of our 3D printers,” Crump concluded.