NEWS RELEASE
FOR IMMEDIATE RELEASE
CONTACT:
Frank J. Spina
Vice President & Chief Financial Officer
805/295.5600, Ext. 2216
Mary E. Woods
Investor Relations
805/295.5600, Ext. 2508
3D SYSTEMS REPORTS SECOND QUARTER PROFIT
COMPARED TO YEAR-AGO LOSS,
PRODUCT SALES UP 18%
VALENCIA, Calif., July 23, 1998--3D Systems Corporation (Nasdaq NMS:
TDSC) today reported total second quarter revenues of $24.7 million, up 13% from
$21.8 million in the prior year, while product sales increased 18% to $16.7
million, compared with $14.1 million in the quarter a year ago.
Net income for the quarter totaled $526,000, or 5 cents a share,
compared with a net loss in last year's second quarter of $280,000, or 2 cents a
share. The 1997 quarter included $500,000 in non-recurring expenses related to
severance benefits.
For the six months ended June 26, the company posted record revenues of
$47.5 million, up 10% from $43.3 million in 1997. First half net income was
$880,000, 8 cents a share, compared with $108,000, or 1 cent a share, in the
year earlier period.
Arthur B. Sims, chairman and chief executive officer, commented: "We
are pleased by the company's increasing sales and improved bottom line. Product
margins continue to improve, our order bookings rate is up substantially over a
year ago, and the balance sheet is benefiting from better asset management."
At the close of the second quarter, the company's balance sheet showed
cash and short-term investments of $19.2 million, up $3.6 million from the
preceding quarter. Receivables, measured by days sales outstanding, improved to
87 days, down from the prior quarter's 94 days. Inventories continued their
downward path, and were 15% less than at year-end.
(MORE)
Concerning operating expenses, Sims stated that "while general and
administrative expenses were about flat with the first quarter, sales and
marketing reflected planned program increases and variable expenses related to
revenue. Also, while research and development expenses were up over the first
quarter, and the second quarter a year ago, they relate to specific projects
that are proceeding according to plan and substantially on schedule.
"Orders flow overall showed substantial improvement over last year's
second quarter, although performance was not uniform across our three main
markets. The Americas were strong compared to a year ago, though not yet
performing up to our full expectation. 3D's European orders flow was robust and
compensated for anticipated weak results in Asia, which accounts for a
relatively small part of our business."
3D Systems manufactures rapid product development systems that enable
users to move from concept models to finished parts faster, at lower cost, and
at higher quality than traditional methods. 3D Systems' equipment fabricates
solid objects using digital input from CAD/CAM/CAE computer systems,
substantially reducing the time and costs of bringing new products to market.
Major applications include concept modeling, rapid prototyping and rapid tooling
for products in a wide range of industries worldwide including automotive,
aerospace, medical, electronic and consumer products.
Except for the historical information contained in this news release,
the matters discussed include forward-looking statements that involve risks and
uncertainties including the availability and acceptance of new products, the
impact of competitive products and pricing, the ability of the company to
continue to contain expenses, dependence on key personnel, industry-wide
domestic and international economic conditions, and other risks detailed in the
company's SEC report on Form 10-K for the year ended December 31, 1997.
###
For current investor information, please call 3D Systems' shareholder
communications service at 800-757-1799.
3D SYSTEMS CORPORATION
Consolidated Balance Sheets
(Unaudited)
ASSETS December 31, 1997 June 26, 1998
----------------------- ----------------------
Current assets:
Cash and cash equivalents $ 12,694,831 $ 12,524,301
Short-term investments 3,498,265 6,647,458
Accounts receivable, less allowances for doubtful accounts of
$441,399 (1997) and $746,108 (1998) 23,618,237 23,601,506
Current portion of lease receivables 1,257,006 1,393,983
Inventories 12,164,633 10,372,709
Deferred tax assets 3,319,651 2,489,738
Prepaid expenses and other current assets 2,305,163 2,502,186
----------------------- ----------------------
Total current assets 58,857,786 59,531,881
Property and equipment, net 16,895,011 15,534,240
Licenses and patent costs, net 5,464,351 5,587,781
Deferred tax assets 3,971,000 3,971,000
Lease receivables, less current portion 3,944,462 4,437,817
Other assets 2,207,109 2,043,102
---------------------- -----------------------
$ 91,339,719 $ 91,105,821
======================= ======================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 4,885,831 $ 3,724,213
Accrued liabilities 8,814,193 7,770,366
Current portion of long-term debt 95,000 95,000
Customer deposits 238,248 293,757
Deferred revenues 6,514,868 8,972,119
----------------------- ----------------------
Total current liabilities 20,548,140 20,855,455
Other liabilities 1,491,534 1,727,492
Long-term debt, less current portion 4,705,000 4,655,000
----------------------- ----------------------
26,744,674 27,237,947
----------------------- ----------------------
Stockholders' equity:
Preferred stock, $.001 par value. Authorized 5,000,000 shares;
none issued
Common stock, $.001 par value. Authorized 25,000,000 shares;
issued 11,450,071 and outstanding 11,425,071 (1997) and issued
11,557,133 and outstanding 11,332,133 (1998) 11,450 11,557
Capital in excess of par value 73,856,965 74,531,972
Notes receivable from officers --- (420,000)
Accumulated deficit (8,897,605) (8,017,582)
Cumulative translation adjustment (210,827) (698,132)
Treasury stock, at cost, 25,000 shares (1997) and 225,000 shares (164,938) (1,539,941)
(1998)
----------------------- ----------------------
Total stockholders' equity 64,595,045 63,867,874
======================= ======================
$ 91,339,719 $ 91,105,821
======================= ======================
3D SYSTEMS CORPORATION
Consolidated Statements of Operations
(Unaudited)
Three Month Periods Ended Six Month Periods Ended
-------------------------------------- -------------------------------------
Sales: June 27, 1997 June 26, 1998 June 27, 1997 June 26, 1998
---------------- ----------------- ---------------- ----------------
Products $ 14,111,466 $ 16,715,008 $ 27,709,322 $ 31,242,357
Services 7,691,979 7,957,544 15,552,935 16,266,552
---------------- ----------------- ---------------- ----------------
Total sales 21,803,445 24,672,552 43,262,257 47,508,909
---------------- ----------------- ---------------- ----------------
Cost of sales:
Products 7,711,852 8,436,977 14,999,244 16,328,577
Services 5,636,094 5,484,087 11,138,683 11,039,896
---------------- ----------------- ---------------- ----------------
Total cost of sales 13,347,946 13,921,064 26,137,927 27,368,473
---------------- ----------------- ---------------- ----------------
Gross profit 8,455,499 10,751,488 17,124,330 20,140,436
---------------- ----------------- ---------------- ----------------
Operating expenses:
Selling, general and administrative 7,170,603 7,480,037 13,561,294 14,118,569
Research and development 2,011,893 2,568,411 3,941,727 4,880,045
---------------- ----------------- ---------------- ----------------
Total operating expenses 9,182,496 10,048,448 17,503,021 18,998,614
---------------- ----------------- ---------------- ----------------
Income from operations (726,997) 703,040 (378,691) 1,141,822
Other income 334,622 205,757 685,670 384,642
Other expense (68,420) (100,128) (127,203) (172,583)
---------------- ----------------- ---------------- ----------------
Income before provision for income taxes (460,795) 808,669 179,776 1,353,881
Provision for (benefit from) income taxes (181,114) 283,034 71,911 473,858
---------------- ----------------- ---------------- ----------------
Net income $ (279,681) $ 525,635 $ 107,865 $ 880,023
================ ================= ================ ================
Weighted average shares outstanding 11,376,199 11,347,277 11,368,116 11,318,001
================ ================= ================ ================
Net income per common share $ (.02) $ .05 $ .01 $ .08
================ ================= ================ ================
Weighted average shares outstanding and
dilutive shares 11,524,374 11,756,144 11,643,948 11,726,868
================ ================= ================ ================
Net income per common share assuming
dilution $ (.02) $ .04 $ .01 $ .08
================ ================= ================ ================