NNDM - Earnings call 3 2023 | Nano Dimension Ltd.

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Operator

Good day, ladies and gentlemen. Welcome to Nano Dimension's Third Quarter 2023 Earnings Conference Call. My name is Betsy, and I'm your operator for today's event.

On the call with us today are Yoav Stern, CEO and Member of the Board of Directors; Tomer Pinchas, COO and acting CFO; and Julien Lederman, VP of Corporate Development.

Before we begin, may I remind our listeners that certain information provided on this call may contain forward-looking statements, and the safe harbor statement outlined in today's earnings press release also pertains to statements made on this call.

yet it copy section in company's not release, the of have website. view please the you received of a press the If Investor Relations Investor also of will begin will answer management session, with followed available call at replay update call of will your business a A on company's questions. today's the the team by Relations a website. Yoav which section the the be question-and-answer time the like to CEO turn the of to over Stern. Dimension's of now call and Nano Member would Board Yoav Directors, I go ahead. Please

Yoav Stern

had Thank you best is quarter for the the take as year. very quarters our third much. quarter about in on close to this -- the everybody. completed third X year. months X fourth planned, Good XXXX. the This day will if around We And proceeds us as either planned in best It's earlier the history. budget or results we last we third the history. in our quarter quarter, in revenue same It's

So very speak stage, new about. are which we very starting happy, I'll good, a but

the you for acquisitions, was you've asking growth organic times, The many, organic growth was were acquisitions been what months but about organic growth organic many I'm The because XX%. great, XX%. historically, that's small, X me emphasizing did growth.

last But M&A. speak it on separately, about are growth the because into we we'll and larger we we XX play organic for months, it's growing which are So now, didn't do are acquisitions, meanwhile, the organically. getting

the XX% growth. end the to of expect to year close be We

it's important. profit. say even the gross increased We more I would

You lot. don't see a this

to higher same more themselves, on XX% in the a on basis our companies to and in at X months, last XX% XX% margin year numbers quarterly non-IFRS. XX% in and or look for general, If a quarter gross the gross from XXX% profits were similar industry IFRS grew than the but interesting you our

to practically it we to will gross grow. and XX% believe So we margin, close are continue

the just It questions. manufacturing, It we'll didn't lot sold something. on with you a focus tell to of have want of talk if happened in itself. and happen I you And cost infrastructure goods by it our about and changing

a Second a I our added general very, changes sitting serious very Garrett in few the Glass and the corporate and good spoke months reputable us, just change Reason last [indiscernible]. know, you changes what firms joined be Board. and our out. We is stepped I where major shareholders with it didn't we we the members, in and X of they governance we to but thing I over recommended. basically X Mike do. on if -- which did ISS don't Board to of would thought the reduced made joined Lewis, when management. with on X-star and thing because I -- X We I And that roles is years even know some Board, that size spoke happened have by I which the the not a a have choice. us was initially, Board advisory ago, so in

Nissan-Cohen So very very, continued beautiful. the -- Dr. I and Director; of happy. Chairman my and do Board. It's I'm work Yoav is stepped to together. We role CEO the now

governance, side the we business the and the beyond numbers defense. On the corporate successes of have in

of R&D product technology important investment largest least not We and the world. And computer sold in machines the -- now in companies. we space this is company leading have of probably in development. amount the one successes a to space because biggest major And

the one are of while that, manufacturing cloud lot you to sounds and of additive it materials, thing I'll biocompatible when Softer materials building a and some we we network a back manufacturing, X milestone, there's you remember the ago course, of software, years will milestone. I here when take and you and told do the And material I robotics, as development process. you with real automation, that's it the a of told past, the important: reach day, at be of in end

the first has been reached. one So

here. came, INSU in one. for is not a called is material, and mass And announced different to year January, soon, a trade about into insulation, in material and the a into the on better coming than new take very November of is will announced -- in show, one excited move in last It this -- believe, It's -- that market Very the are electronics be we us we we a was we're This INSU the beginning -- electronics. Coming actually but material totally -- in production we which revolutionary it. final XXX. with beginning much going for production out and side. the

questions. We a on not there we into I'm but side, get other going deep have additive manufacturing lot materials be that unless that of added the too will to

-- is expenses. of actually, than for half less, in X/X gross talk I reduced I'll of It and EBITDA -- and show to and the move business speak model almost profit. was about XXXX. quarter the it it. was a to earlier more next EBITDA. adjusted phase, comparing the quarter Dimension it's -- release, what million, is regular in last adjusted the We QX million, comparing let's is last Nano the about to initiative, very you bit second our is year It the margin $X.X in it's in year. expenses to very, expenses a R&D here the of sorry, intended. I'll it's that which XX% about The this X/X sorry, financials. in $XX same see little highlighted of Next, quarter in XX% Interestingly quarter I'll described this first of it R&D than gross half is moving I and R&D which news an reason more -- the talk

thing here, you'll activist see Another that damages.

company. the busy damaging are that investors activist have We

close we believe of beginning what for waste experts, spent, a as it million. now lawyers, that Be since is have to year, accountants, until million, $XX We advisers of may. paying the the $XX

forward. for Our voted and shareholders us we're moving

bottom but is look at you to go same now line at spoke, to bottom, in table, the if On where the we quarter $XX the comparing year. last million we are this margins, This million gross $X.X the number the on burned only I going.

we We next are to change are us. is just year we do very, another very next growing today formula, the whole XX, already this run a will of quarter are if at That's we acquisition, end it rate expenses million where profitability from our the which obviously of for exciting organically, even hoping $XX year an and -- at to actually in the cap if year. reach

loss will to to why $XX what is ending understand slide, this up million see of Next you able be number, $X of the net large million is it and just cash reconciliation per exactly annum.

XX,XXX top, what $XX So I green, million if see start in you the interest you'll colored the is income. from

a have $XX maybe about We right? more, million year,

Tomer Pinchas

million This Yes. reach annual more is year, we are than month. income, $X basis. of to X% a interest million It's $XX going about interest approximately which on an

Yoav Stern

obviously, working we effective So are way grow and our capital, to nice on it. and it's a

any between investment, industry to X% have management. cash. -- our of in management We weekly on than in risky but that's do our the fever. X% we a capital invest and our not other invest have in not course, Then services. investments yellow cash returns meetings We of you charter, do not We for get

share $XX yellow Stratasys million this an quarter All it's have numbers negative You Negative positive, from price third million because here -- quarter, so. is is $XX or negative This color. number. to because adjustment reversed. down $XX $XX in is is the sorry, a are that Positive went

speak if day. the representing of funnily for day you or affects last of of the accounting last whole balance quarter the to course, it the the the $XX doesn't is noncash. quarter. And are That's price afterwards can reason enough, XX% we take was it, way it It sheet about It's swings the the to strategic would by the our force anything. take not at the it relate what's because is We million. matter average from reducing meaning rule the way us they're necessarily the but not do should before higher. I month share something the it

years adjusted gross million $XX.X then last the of million. flow million and year, right bringing the million the that leads you we look $X.X fact quarters up again, $X.X million, profit at this start including company $XX.X went went spent for cash cash are cash, moving on that in acquisitions. just to that's net a to down now us the direction. $X we and ahead from and we EBITDA quarter, This And amazing. be used And And in way $XX to the net And -- year million gross back the $XX in $XX you million million to $X.X only XX%. getting in So million all is interest, go the down $XX X.X a from minus profit this it's the margin gross of operation to from from comparison without are right in of the million. to with that after between

gives Next slide slide quarter. very actually quarter speaks It's months slide slide per I last how you XX did much per it's last at that like scale up? the because quarter. shows a we a point, a not exactly This about this this

years ago, it's we in that see XXXX, were you $X So the X company. QX million of just

now QX we X million have company, it's company. X the acquisition. $XX without at years $XX quarters, last you later, If And quarters, X look million over

it's look you $XX if from So $XX at QX to million million. 'XX,

to we -- listening metal I'll about you lot don't electronic we many goes in to the other the if A both last course, the to company or Next it? their And structured electronics. to electronics everybody of Because in see see not? results. talking industries my and and slide to defense because good this industry headwinds. of companies general, additive industries. shows manufacturing not additive the and industry and manufacturing compatriots into following And all electronic quarter in is other are the projections business, I'm them companies guys diversified hear public tell ceramics other you you Why are are of we and it and in comparing sell electronics why XX%. was

left pretty third diversification one margin on quarter side, it. One gross the being and So to and it fourth in is the The we colors. the revenue you are And us leads you X which IFRS. this right looks see non-IFRS the is see is where quarter, on right now good. adjusted side, this

before. industry. the spoke the we mentioned numbers in the the peers. So peers I Growth outpaced

is We Markforged the the of average as and not and an whole for peer it of percentages, have those in X% in all the XX% terms I XX% XD, in much, Systems the group. size is what of XX%, Metal, obviously, percentages Markforged. we It's than a are because and But so here average to growing. drop company mean Desktop Stratasys, relates XD average the above, bigger much of

it not middle the we we for elementary but which model up time going? school business Last you coherent and to are and grew, elementary into into where school if it's we call focused leave Reshaping model, The build a to or Nano. We leave on grow integrated our least, wish, business means kindergarten school, acquisitions business.

toward a manufacturing. We vision cloud are leading with

So and $XX-or-close calling were gross we to at of million are That's time think adjust but to by what and profitability. more business the to margin, it's model revenue for Nano. close acquisitions multiplied Reshaping XX%

about allocate expenses. decide we capital, about decide how to allocate how to We

difficulties to thought about do it the to because war. have very, expenses will did We serious reduced thing continue $XXX close we week, a of Most to it's approval XXX worldwide. our very have Israel it's because we do XX% out million XXX. it, something We, of in about Think the the We them during year. all to last people that. right and the with We million the it purchased or of in shares cut we This about in another do. like about $XXX it decide is may of

towards support. them just do Of have improved we course, ourselves profitability. with we are because But full to gave let them goodbye and say We alone the it we didn't right time. leading

$XX start It's already it. annually, next not million year. to this We'll for year save and close to waiting we're done

parallel I so want The And it. do. very I that thank you, before shareholders, I of the XX% we're has here can foremost, second lot of our through, their the it the specifically in money. Board. shareholders get for major Gaza,but first through you step that tell I'm have Gaza, through will expenses fight want the reserve with we we fighting And not serious with going thank Israel repeat to some shareholders and one of we've supporting service difficult their just us not us. Israeli with. will and in going governance in that in to about to time to consolidating this before, mentioned cut will facilities been are place. going a of time closing so the that, got division overhead [ to take supporting support. I as that that XX%, time be a our in that right money. over we as And and another But for descendant the wasting I and through with we And is and here war spoke and and ] it's to employees acquisitions perform.

to answer questions thanking for you So the opening and ready we support, for again I'll summarize are questions. just by and up

Operator

with Recovered question The Rosenberg Instructions] Innovations.. [Operator today Ron from comes first

Unknown Analyst

tactical curious, on conflicts I'm the the the defense well see and significant Nano in asking do the increase about at defense I'm business. additive how manufacturing the the impact budget spending industry And large. globally of as you in I'm XD sector. various the as

Yoav Stern

way. me put it Let this

First the Israel, now, and the there's Israel fact don't here in are European the in all, still and I defense-wise visiting the Europe air I'm spending, it all it the other atomic the a an other with of business will carrier serious year. that very, see not the companies successful were and defense in here last political situation an AM that affects United a it's submarine in very in general and United talking States. and with countries, both defense, Ukraine, fact of the that States in having over by the general, about but month, it defense We situation affect European especially that think

We what's very, we so have a happening there. to very director close from are Lockheed,

got asked of about is talk what manufacturing, itself, Now ahead and then specifically additive you they high look, and an big manufacturing to additive industry, deliver.

production it products. actually do understand, get can we the line or that you divide now is the the to product the cost defense, of economics of too sell only the So whatever X The not they section. do not concept production, types as only for or cannot largest that proof our in industry, for unit additive and prototyping still to And into we it's products high.

fill that's first reason and for products So that definitely successful. it, are we're we it, the so for kind the feel

why question. and Stratasys Frankly, not And I I as XD I question. don't of them headwinds. the defense so answered industry the So is rest feel hope to part you quarter and I successful asked and of guess claiming us the tailwinds they your Desktop know. this Metal is and I headwinds. think all headwinds. feel the I don't

Operator

the Lederman. I'll Q&A to now hand Julien session over

Julien Lederman

Technology question by Edison a trouble who's sent were Research She's been at Group. Director an Katherine of questions. analyst, having answering We Thompson, the

ask on exactly So difficulties. as me I'll her technological to the given to it written read behalf she has it of

from One, gross now this at The gross is read adjusted grow verbatim. more achieve? will margin you the margin So expenses? think for What cost to this program do about help pause reduce XX%. She the but I'll level? other program gross is you you. base, questions, is the the the reducing question operating will there. I margin has optimal Yoav, could is Or

Yoav Stern

Okay.

both the define First, exactly on goes we sides, it. cost it reduction

general includes manufacturing, the by goes the on to have includes it it and others, squeeze myself where which go-to-market, we buying, need We myself, COGS. that with we general we're management, reduction what do supply reduction overhead support. the effort better we sales, that. And chain, planning, better to or everything by including the it a as finance, and assembly focusing COGS have including marketing, an acquisition, of whole deals that's a merger need And cutting like, of the group costs overhead, is don't I we based especially, if just squeeze including but that unfortunately, on into

So that's things. X

gross we margin do Well, think of you The have is, be? products. different what other you asked our kind question should

what is. the should of product cycle XX% between deliver and gross our It stage XX%. are the it XX%, life above product XX%. what lines products in Our product depends XX%, to of margins Most line on

Julien Lederman

she has more and written. ask just I'll they're questions, repeat X I'll as them

order look able give an indication organic to Second revenue question, into Are targeting growth you backlog what your you QX does in year 'XX? going the how 'XX? for are of fiscal

Yoav Stern

QX, have know. don't finish I 'XX for yet. market. indications it Obviously, visibility visibility. we will I don't into have have once and any the have we we I year this once of

we'll of XX want. we it, at be We we'll year January, end the to obviously, enough. it to the of from almost be because end the not quarter sales of going the into hope because didn't beginning And quarter around this $XX the XX. a know XX expect projection. our certain the being I bit to we the to It's $XX next get With between XXXX, rolled but is be if about million year. of million. growth close will That's It's luck reach into little 'XX, are after XX%.

Julien Lederman

final M&A. and technology it Any considering? back this. at Thompson, And Are you able you from companies operator, what Edison third the answers analyst areas? Yoav is we'll The after are to to hand types particular question of you say Katherine

Yoav Stern

revenue for companies that money difference went money for made companies that a But right the either is of not it's that looking revenue same from revenue; the valuation. million additive companies profile: to and and electronics in following us. either. and $XXX Above major with between manufacturing never Xx Yes. area electronics; ahead additive never the is down XX at next Prices the made on average We're present over the valuation of Xx electronics of market the and that months

for lot private across we're XX seeing companies. both public There's with not and all for talking large, public about we large and private speak, X of There's more that it companies. board, a and the we're companies. companies companies are the So probably as

Julien Lederman

there see other group. can any the if you are wider Operator, questions from

Operator

The next comes Sol question Instructions] Zelman Gericare. [Operator from with

Sol Zelman

Yoav, you, Israel. safe in saying, call. on your your A last to our I is hope like I start has family, by everyone colleagues, would gone lot since

is the would to hopefully, hopefully, that I making everybody sound. and start this, that sure with of comes safe recognizing And in everybody term, and that, So long out like okay.

Yoav Stern

very you a Thank Yes. Israel small much. is place.

it's to But okay, moving activity. in me while family I the family for we everybody difficult right my XXX we're don't have when is you So still people direction. is our and much. very in very okay Thank say

Sol Zelman

our prayers would have in You -- if just to I the where queue you'd I and sure my like questions. globally. I and I'm have time for that's fall didn't go know

So just just the the question out. work way to happened

profile. You I where Karen's then you believe a companies from preface at the from question following previously it you was looking I answered tender offer. Stratasys -- asked with mentioned and that potentially in I your question about during be the would it heard

concern being you we Stratasys During continue in position that had the is reduced quarter there now? an broken the enterprise that alarming low is digits, I to weak see cash offer, rate. to due that here. see you the Or tens up reengage took after it pulling what lower the to end if tender single value see potential offer, quarter of a end business at their right there you if an Stratasys or market where Fast-forward, we're of you the do based they and to model on is falling up fact made will -- mention now, the numbers opportunity

Yoav Stern

Excellent question.

start second answer by me you part. Let the

in obviously, reporting deceiving $XXX to... and Stratasys cash They Bottom it. most doing the line, million is called of of way are the is cash their One you sophisticated. from went you right it way

Tomer Pinchas

$XXX to million. million $XXX

Yoav Stern

months. X is, $XXX I'm X divide let's about million in That XXX $XXX a To mill repeating, to say, month. XXX million to X months, in $XX

Tomer Pinchas

About a quarter. $XX million

Yoav Stern

Absolutely. quarters And I've million it. no opportunity? quarter. share it as to $XX That said, And about X is surprise mentioned means There's is. you a they X, there have the where is an go.

that still all, changes think the the the in sorry, we than make now problems it. I lower. other can minor will fixed had And First major of they past -- thought some we much are in fix not there, it be can Stratasys the did And but past price ones. still I that because

So it's an opportunity.

bit Maybe now almost Stratasys, it's say it transactions, a I I tired the was a It ago, that much I think transactions. it largest thing. offered I of thinking non-friendly me. all prices never I'll print read from They not anyhow. want friendly hostile we kind be shareholder. media. But with but half a so a to And last I'm logical, the year higher I'm what were met than would are out on now to offer turned with hostile little basis.

were do know And of would very life, part friendly, group. to are a the -- in of sure they business again, to tomorrow part it's friendly in I totally sentiments of friendly is I'm answered to is us. not it opportunities there's me I question. If I quality which -- today, not are the transaction the we don't it's as quality being other if I speak hope shareholders but your do We about market that it, lot to with demolished. when that want morning. about want a their And they fight other of

Operator

session. question-and-answer closing our the to for any over remarks. like back company conference turn would concludes This I the to

Yoav Stern

I a since the touch much. am our over thank call, you Thank day. for shareholders please good Everybody e-mails. with interest. on a good in the your and day. Okay. the last trading Have a you year, very lot -- over We have retail And Internet

shareholders. noninstitutional know I you Thank all have everybody. lot I connect it much. very And may with way forward of And did a we good it's do to news, You to interesting some once I because continue to look videos. a reach

Operator

earnings Nano conference concluded. The attending now has call. Dimension's conference Thank for you quarterly

You may now disconnect.

Nano Dimension (NNDM) 28 Nov 232023 Q3 Earnings call transcript