This release is available on the Stratasys web site at www.stratasys.com
Additional information on the Mojo 3D printer can be accessed at www.mojo3dprinting.com; and http://www.mojo3dprinting.com/printers/videos.aspx.
Important Information for Investors and Shareholders
In connection with the proposed combination of Objet and Stratasys pursuant to an Agreement and Plan of Merger (the “Merger”), Objet will file with the Securities and Exchange Commission (the “SEC”) a registration statement on Form F-4, which will include a proxy statement/prospectus of Stratasys and a prospectus of Objet, as well as other relevant materials in connection with the proposed transaction. Stratasys will concurrently file the same proxy statement/prospectus with the SEC and will mail it to Stratasys shareholders for purposes of soliciting proxies for voting in favor of the Merger at a special meeting of Stratasys stockholders called for the purpose of approving the Merger Agreement and the Merger. INVESTORS AND SHAREHOLDERS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS AND OTHER RELEVANT MATERIALS WHEN THEY BECOME AVAILABLE BECAUSE THESE MATERIALS WILL CONTAIN IMPORTANT INFORMATION ABOUT STRATASYS, OBJET AND THE PROPOSED TRANSACTION. The proxy statement/prospectus and other relevant materials (when they become available) and any other related documents filed with the SEC may be obtained free of charge on the SEC’s website at www.sec.gov or via the Stratasys website at www.stratasys.com. Shareholders may also obtain a copy of the SEC filings free of charge upon written request to Stratasys, Attention: Shane Glenn, Director of Investor Relations, 7665 Commerce Way, Eden Prairie, Minnesota 55344.
Stratasys’ executive officers and directors may be deemed to be participants in the solicitation of proxies from the shareholders of Stratasys in connection with the Merger. Information about Stratasys’ executive officers and directors and their ownership of Stratasys common stock is set forth in Amendment No. 1 to Stratasys’ Annual Report on Form 10-K for the year ended December 31, 2011, which was filed with the SEC on April 27, 2012.
This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.
About Stratasys
Stratasys Inc. is a maker of additive-manufacturing machines for prototyping and producing plastic parts. The company markets under the brands uPrint, Mojo and Dimension 3D Printers and Fortus Production 3D Printers. The company also operates RedEye On Demand, a digital-manufacturing service for prototypes and production parts. Stratasys manufactures 3D printers for Hewlett Packard, which it sells under the brand Designjet3D. In 2011 Stratasys acquired 3D printer maker Solidscape Inc. According to Wohlers Report 2011, Stratasys had a 41-percent market share in 2010, and has been the unit market leader for the ninth consecutive year. Stratasys patented and owns the Fused Deposition Modeling (FDM®) process. The process creates functional prototypes and manufactured goods directly from any 3D CAD program, using high-performance industrial thermoplastics. The company holds more than 350 granted or pending additive-manufacturing patents globally. Stratasys products are used in the aerospace, defense, automotive, medical, business and industrial equipment, education, architecture, and consumer-product industries. Online at: www.Stratasys.com
FDM, Dimension, Fortus, uPrint, Mojo and Stratasys are registered trademarks of Stratasys Inc. Fused Deposition Modeling is a trademark of Stratasys Inc.
| STRATASYS, INC. AND SUBSIDIARIES | ||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||
|
Three Months Ended March 31, |
||||||||||
| 2012 | 2011 | |||||||||
| (unaudited) | (unaudited) | |||||||||
| Net sales | ||||||||||
| Products | $ | 37,545,792 | $ | 28,096,205 | ||||||
| Services | 7,418,309 | 6,481,924 | ||||||||
| 44,964,101 | 34,578,129 | |||||||||
| Cost of sales | ||||||||||
| Products | 17,810,559 | 13,485,265 | ||||||||
| Services | 4,198,599 | 2,842,412 | ||||||||
| 22,009,158 | 16,327,677 | |||||||||
| Gross profit | 22,954,943 | 18,250,452 | ||||||||
| Operating expenses | ||||||||||
| Research and development | 4,352,160 | 3,348,093 | ||||||||
| Selling, general and administrative | 11,374,792 | 8,736,231 | ||||||||
| 15,726,952 | 12,084,324 | |||||||||
| Operating income | 7,227,991 | 6,166,128 | ||||||||
| Other income (expense) | ||||||||||
| Interest income, net | 250,426 | 205,781 | ||||||||
| Foreign currency transaction losses, net | (52,337 | ) | (131,115 | ) | ||||||
| Other, net | 97,625 | 1,396,606 | ||||||||
| 295,714 | 1,471,272 | |||||||||
| Income before income taxes | 7,523,705 | 7,637,400 | ||||||||
| Income tax expense | 3,001,370 | 2,647,905 | ||||||||
| Net income | $ | 4,522,335 | $ | 4,989,495 | ||||||
| Earnings per common share | ||||||||||
| Basic | $ | 0.21 | $ | 0.24 | ||||||
| Diluted | $ | 0.21 | $ | 0.23 | ||||||
|
Weighted average number of common shares outstanding |
||||||||||
| Basic | 21,265,772 | 21,009,871 | ||||||||
| Diluted | 21,802,393 | 21,647,691 | ||||||||
| Note: Certain reclassifications have been made to prior period balances to conform to current period presentation. | ||||||||||
| STRATASYS, INC. AND SUBSIDIARIES | ||||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||||
| March 31, | December 31, | |||||||||
| 2012 | 2011 | |||||||||
| (unaudited) | ||||||||||
| ASSETS | ||||||||||
| Current assets | ||||||||||
| Cash and cash equivalents | $ | 24,427,680 | $ | 20,092,200 | ||||||
| Short-term investments - held to maturity | 17,621,567 | 14,602,408 | ||||||||
|
Accounts receivable, less allowance for doubtful accounts of $1,010,000 at March 31, 2012 and $1,089,000 at December 31, 2011 |
28,149,480 | 26,230,289 | ||||||||
| Inventories | 21,619,711 | 22,771,460 | ||||||||
|
Net investment in sales-type leases, less allowance for doubtful accounts of $258,000 at March 31, 2012 and $230,000 at December 31, 2011 |
3,846,831 | 3,295,039 | ||||||||
| Prepaid expenses and other current assets | 2,617,025 | 3,259,012 | ||||||||
| Deferred income taxes | 2,973,000 | 2,973,000 | ||||||||
| Total current assets | 101,255,294 | 93,223,408 | ||||||||
| Property and equipment, net | 41,494,535 | 39,669,433 | ||||||||
| Other assets | ||||||||||
| Goodwill | 25,417,558 | 25,393,967 | ||||||||
| Other Intangible assets, net | 25,020,741 | 25,295,032 | ||||||||
| Net investment in sales-type leases | 5,500,508 | 5,494,753 | ||||||||
| Long-term investments - held to maturity | 29,904,534 | 32,581,472 | ||||||||
| Other non-current assets | 145,332 | 112,300 | ||||||||
| Total other assets | 85,988,673 | 88,877,524 | ||||||||
| Total assets | $ | 228,738,502 | $ | 221,770,365 | ||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||
| Current liabilities | ||||||||||
| Accounts payable and other current liabilities | $ | 19,404,542 | $ | 19,368,197 | ||||||
| Unearned revenues | 10,486,025 | 9,768,610 | ||||||||
| Total current liabilities | 29,890,567 | 29,136,807 | ||||||||
| Non-current liabilities | ||||||||||
| Deferred tax liabilities | 6,760,000 | 6,760,000 | ||||||||
| Unearned revenues - long-term | 2,656,101 | 2,562,195 | ||||||||
| Total liabilities | 39,306,668 | 38,459,002 | ||||||||
| Commitments and contingencies | ||||||||||
| Stockholders' equity | ||||||||||
|
Common stock, $.01 par value, authorized 30,000,000 shares; 26,978,696 and 26,933,301 issued at March 31, 2012 and December 31, 2011, respectively |
269,787 | 269,333 | ||||||||
| Additional paid-in capital | 119,619,707 | 118,134,006 | ||||||||
| Retained earnings | 108,534,193 | 104,011,848 | ||||||||
| Accumulated other comprehensive loss | 12,572 | (99,399 | ) | |||||||
|
Treasury stock at cost, 5,687,631 shares at March 31, 2012 and December 31, 2011 |
(39,004,425 | ) | (39,004,425 | ) | ||||||
| Total stockholders' equity | 189,431,834 | 183,311,363 | ||||||||
| Total liabilities and stockholders' equity | $ | 228,738,502 | $ | 221,770,365 | ||||||
| Note: Certain reclassifications have been made to prior period balances to conform to current period presentation. | ||||||||||
| STRATASYS, INC. AND SUBSIDIARIES | |||||||||||||||||||||||||||
| RECONCILIATION OF NON-GAAP TO GAAP RESULTS OF OPERATIONS | |||||||||||||||||||||||||||
|
Three Months Ended March 31, 2012 |
Three Months Ended March 31, 2011 |
||||||||||||||||||||||||||
| As Reported | Non-GAAP | As Reported | Non-GAAP | ||||||||||||||||||||||||
| (unaudited) | Adjustments | (unaudited) | (unaudited) | Adjustments | (unaudited) | ||||||||||||||||||||||
| Net sales | |||||||||||||||||||||||||||
| Products | $ | 37,545,792 | $ | - | $ | 37,545,792 | $ | 28,096,205 | $ | - | $ | 28,096,205 | |||||||||||||||
| Services | 7,418,309 | - | 7,418,309 | 6,481,924 | - | 6,481,924 | |||||||||||||||||||||
| 44,964,101 | - | 44,964,101 | 34,578,129 | - | 34,578,129 | ||||||||||||||||||||||
| Cost of sales | |||||||||||||||||||||||||||
| Products | 17,810,559 | (436,012 | ) | (a) | 17,374,547 | 13,485,265 | - | 13,485,265 | |||||||||||||||||||
| Services | 4,198,599 | - | 4,198,599 | 2,842,412 | - | 2,842,412 | |||||||||||||||||||||
| 22,009,158 | (436,012 | ) | 21,573,146 | 16,327,677 | - | 16,327,677 | |||||||||||||||||||||
| Gross profit | 22,954,943 | 436,012 | 23,390,955 | 18,250,452 | - | 18,250,452 | |||||||||||||||||||||
| Operating expenses | |||||||||||||||||||||||||||
| Research and development | 4,352,160 | - | 4,352,160 | 3,348,093 | - | 3,348,093 | |||||||||||||||||||||
| Selling, general and administrative | 11,374,792 | (1,595,002 | ) |
(b) |
9,779,790 | 8,736,231 | (323,598 | ) | (d) | 8,412,633 | |||||||||||||||||
| 15,726,952 | (1,595,002 | ) | 14,131,950 | 12,084,324 | (323,598 | ) | 11,760,726 | ||||||||||||||||||||
| Operating income | 7,227,991 | 2,031,014 | 9,259,005 | 6,166,128 | 323,598 | 6,489,726 | |||||||||||||||||||||
| Other income (expense) | |||||||||||||||||||||||||||
| Interest income, net | 250,426 | - | 250,426 | 205,781 | - | 205,781 | |||||||||||||||||||||
| Foreign currency transaction losses, net | (52,337 | ) | - | (52,337 | ) | (131,115 | ) | - | (131,115 | ) | |||||||||||||||||
| Other, net | 97,625 | - | 97,625 | 1,396,606 | (1,204,408 | ) | (e) | 192,198 | |||||||||||||||||||
| 295,714 | - | 295,714 | 1,471,272 | (1,204,408 | ) | 266,864 | |||||||||||||||||||||
| Income before income taxes | 7,523,705 | 2,031,014 | 9,554,719 | 7,637,400 | (880,810 | ) | 6,756,590 | ||||||||||||||||||||
| Income tax expense | 3,001,370 | 417,170 | (c) | 3,418,540 | 2,647,905 | (330,197 | ) | (c) | 2,317,708 | ||||||||||||||||||
| Net income | $ | 4,522,335 | $ | 1,613,844 | $ | 6,136,179 | $ | 4,989,495 | $ | (550,613 | ) | $ | 4,438,882 | ||||||||||||||
| Earnings per common share | |||||||||||||||||||||||||||
| Basic | $ | 0.21 | $ | 0.08 | $ | 0.29 | $ | 0.24 | $ | (0.03 | ) | $ | 0.21 | ||||||||||||||
| Diluted | $ | 0.21 | $ | 0.07 | $ | 0.28 | $ | 0.23 | $ | (0.03 | ) | $ | 0.21 | ||||||||||||||
| Weighted average number of common | |||||||||||||||||||||||||||
| shares outstanding | |||||||||||||||||||||||||||
| Basic | 21,265,772 | 21,265,772 | 21,009,871 | 21,009,871 | |||||||||||||||||||||||
| Diluted | 21,802,393 | 21,802,393 | 21,647,691 | 21,647,691 | |||||||||||||||||||||||
|
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. |
|||||||||||||||||||||||||||
| (a) Represents amortization expense related to acquired Solidscape, Inc. intangible assets. | |||||||||||||||||||||||||||
|
(b) Represents non-cash stock-based compensation expense of $480,639, amortization expense of $133,333 related to acquired Solidscape, Inc. intangible assets and expense of 981,030 associated with the Company's current efforts to combine with Objet Ltd. |
|||||||||||||||||||||||||||
| (c) Represents the tax benefit (expense) related to non-GAAP adjustments. | |||||||||||||||||||||||||||
| (d) Represents non-cash stock-based compensation expense. | |||||||||||||||||||||||||||
| (e) Represents gain on the sale of an equity investment during the first quarter of 2011. | |||||||||||||||||||||||||||
|
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. |
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| STRATASYS, INC. AND SUBSIDIARIES | ||||
| FISCAL YEAR 2012 | ||||
| RECONCILIATION OF NON-GAAP TO GAAP FORWARD LOOKING GUIDANCE | ||||
| Earnings Per Diluted Share Range | ||||
| U.S. GAAP measure | $0.97 to $1.13 | |||
|
Adjustments |
||||
| Stock-based compensation expense | $0.04 to $0.08 | |||
| Solidscape, Inc. intangible amortization expense | $ 0.07 | |||
| Objet-related transaction expense | $0.14 to $0.17 | |||
| Non-GAAP estimate | $1.29 to $1.38 | |||
|
Forward looking guidance does not reflect the potential combined performance of Stratasys, Inc. and Objet Ltd, nor does it include the estimated costs that would be incurred upon closing the transaction. |
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