The ExOne Company Reports 2020 Third Quarter Results

  • Record third quarter revenue of $17.4 million, up 60% year-on-year, with sales of 3D printers more than doubling
  • Record backlog of $42.6 million increased 12% sequentially and 65% year-on-year
  • Total liquidity increased to $49.4 million, more than doubling year-to-date

NORTH HUNTINGDON, Pa. — (BUSINESS WIRE) — November 5, 2020The ExOne Company (Nasdaq: XONE) (“ExOne” or the “Company”), the global leader in industrial sand and metal 3D printers using binder jetting technology, today reported financial results for the third quarter ended September 30, 2020.

“ExOne’s global team delivered a solid quarterly performance, including record third quarter revenue, despite challenging market conditions as a result of COVID-19,” said John Hartner, ExOne’s CEO. “Throughout the quarter, we remained focused on machine order execution and recurring revenue growth, supported by our diverse portfolio, global footprint, and unmatched experience in a technology area benefiting from increased momentum.

“We also continued to drive progress against our strategic pillars – getting closer to customers, evidenced by our record backlog; extending our binder jetting technology, with the announcement of our InnoventPro® entry-level metal 3D printer; and driving recurring revenue growth, demonstrated by our recent government contract wins and sequential quarterly gains.”

Q3 2020 Revenue Summary

Three Months Ended
(in millions) September 30,
Revenue by Product Line

2020

2019

3D Printing Machines

$

10.5

60%

$

4.0

36%

3D Printed and Other Products, Materials and Services

 

6.9

40%

 

6.9

64%

Total Revenue

$

17.4

100%

$

10.9

100%

Q3 2020 Financial Results Summary

The following summarizes ExOne’s financial results for the third quarter ended September 30, 2020:

  • Revenue was $17.4 million, compared to $10.9 million in last year’s third quarter and was driven by a 164% increase in revenue from 3D printing machines led by higher volumes (13 units sold in the quarter versus nine in the prior year period) including contributions from fourth quarter 2019 product introductions, the S-Max ProTM (sand) and X1 25Pro® (metal) platforms, and an overall favorable mix of machines sold. Recurring revenue (3D printed and other products, materials and services) was flat compared to the year-ago period, as increased aftermarket revenue and higher funded research and development revenue was offset by a decline in printing services revenue due to a continued decline in demand as a result of COVID-19. Revenue for both product groups continued to be impacted by COVID-19, including disruptions to domestic and international shipping and travel, in addition to negative macroeconomic effects.
  • Gross margin was 22.4%, compared to 26.4% in the third quarter of 2019. The decrease was primarily due to low contribution margin on various system sales, including the X1 25Pro following its initial market introduction and the sale of a discontinued sand system, as well as unfavorable product warranty experience. These decreases were partially offset by lower fixed overhead costs as a result of cost savings measures and other cost reductions associated with COVID-19.
  • Research and development expenses were $2.0 million, compared to $2.4 million in the third quarter of 2019. The decrease was primarily due to cost savings measures and other cost reductions associated with COVID-19 and lower machine development spending. Investments remain focused on the further development of binder jetting technology, including the X1 160ProTM production metal 3D printing system and the recently announced InnoventPro advanced entry-level metal 3D printing system.
  • Selling, general and administrative expenses were $4.8 million, compared to $5.3 million for the third quarter of 2019. This decrease was driven by a combination of factors including lower travel, trade show, consulting and employee-related expenses, as well as lower net bad debt expense. These decreases were offset by higher sales commission expense associated with a higher revenue base and the absence of an incentive compensation reversal recorded in 2019.
  • Net loss was $3.3 million, or $0.19 per fully diluted share, compared with a net loss of $4.8 million, or $0.30 per fully diluted share, in the third quarter of 2019.
  • Adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”), a non-GAAP measure, was a loss of $1.7 million, compared with a loss of $3.7 million in the third quarter of 2019. Refer to the attached table captioned “Adjusted EBITDA Reconciliation” for important disclosures regarding the Company’s definition and use of Adjusted EBITDA as well as a reconciliation of net loss (the most directly comparable measure under accounting principles generally accepted in the United States (“GAAP”)) to Adjusted EBITDA. ExOne management believes that, when used in conjunction with other measures prepared in accordance with GAAP, Adjusted EBITDA assists in the understanding of its financial results.
  • Cash, cash equivalents and restricted cash as of September 30, 2020 increased to $39.9 million, from $20.2 million at June 30, 2020 and $6.2 million at December 31, 2019. The increase for the sequential quarter was driven by cash inflows from financing activities of $25.0 million, including $24.8 million in net proceeds from the sale of common stock in at-the-market offerings. These inflows were offset by cash outflows from operations of $5.3 million mostly due to the widening net loss, net of noncash items for the period and a reduction in cash inflows from customers based on timing of payments.
  • Total liquidity, which includes unrestricted cash and cash equivalents and availability under the Company’s related party revolving credit facility, increased to $49.4 million at September 30, 2020 compared to $29.7 million at June 30, 2020 and $20.3 million at December 31, 2019. There were no borrowings outstanding under the Company’s $10.0 million related party revolving credit facility at September 30, 2020.

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