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| STRATASYS, INC. AND SUBSIDIARIES | ||||||||||||||||||||
| RECONCILIATION OF NON-GAAP TO GAAP RESULTS OF OPERATIONS | ||||||||||||||||||||
| Three Months Ended March 31, 2012 | ||||||||||||||||||||
|
As Reported |
Pro Forma | Pro Forma | Non-GAAP | Non-GAAP | ||||||||||||||||
| (in thousands, except per share data) | (unaudited) | Adjustments | (unaudited) | Adjustments | (unaudited) | |||||||||||||||
|
Net sales |
||||||||||||||||||||
| Products | $ | 37,546 | $ | - | $ | 37,546 | $ | - | $ | 37,546 | ||||||||||
| Services | 7,418 | - | 7,418 | - | 7,418 | |||||||||||||||
| 44,964 | - | 44,964 | - | 44,964 | ||||||||||||||||
| Cost of sales | ||||||||||||||||||||
| Products | 17,810 | - | 17,810 | (436 | ) | (b) | 17,374 | |||||||||||||
| Services | 4,199 | - | 4,199 | - | 4,199 | |||||||||||||||
| 22,009 | - | 22,009 | (436 | ) | 21,573 | |||||||||||||||
| Gross profit | 22,955 | - | 22,955 | 436 | 23,391 | |||||||||||||||
| Operating expenses | ||||||||||||||||||||
| Research and development | 4,352 | - | 4,352 | - | 4,352 | |||||||||||||||
|
Selling, general and administrative |
11,375 | (981 | ) | (a) | 10,394 | (614 | ) | (c) | 9,780 | |||||||||||
| 15,727 | (981 | ) | 14,746 | (614 | ) | 14,132 | ||||||||||||||
| Operating income | 7,228 | 981 | 8,209 | 1,050 | 9,259 | |||||||||||||||
| Other income (expense) | ||||||||||||||||||||
| Interest income, net | 250 | - | 250 | - | 250 | |||||||||||||||
|
Foreign currency transaction losses, net |
(52 | ) | - | (52 | ) | - | (52 | ) | ||||||||||||
| Other, net | 98 | - | 98 | - | 98 | |||||||||||||||
| 296 | - | 296 | - | 296 | ||||||||||||||||
| Income before income taxes | 7,524 | 981 | 8,505 | 1,050 | 9,555 | |||||||||||||||
| Income tax expense | 3,002 | - | 3,002 | 417 | (d) | 3,419 | ||||||||||||||
| Net income | $ | 4,522 | $ | 981 | $ | 5,503 | $ | 633 | $ | 6,136 | ||||||||||
| Earnings per common share | ||||||||||||||||||||
| Basic | $ | 0.21 | $ | 0.05 | $ | 0.26 | $ | 0.03 | $ | 0.29 | ||||||||||
| Diluted | $ | 0.21 | $ | 0.04 | $ | 0.25 | $ | 0.03 | $ | 0.28 | ||||||||||
|
Weighted average number of common shares outstanding |
||||||||||||||||||||
| Basic | 21,266 | 21,266 | 21,266 | |||||||||||||||||
| Diluted | 21,802 | 21,802 | 21,802 | |||||||||||||||||
|
(a) |
Represents expense associated with the Company's current efforts to combine with Objet Ltd. |
|
|
(b) |
Represents amortization expense related to acquired Solidscape, Inc. intangible assets. |
|
|
(c) |
Represents non-cash stock-based compensation expense of $0.48 million and amortization expense of $0.13 million related to acquired Solidscape, Inc. intangible assets |
|
|
(d) |
Represents the tax benefit related to non-GAAP adjustments. |
|
| STRATASYS, INC. AND SUBSIDIARIES | |||||||||||||||||||
| RECONCILIATION OF NON-GAAP TO GAAP RESULTS OF OPERATIONS | |||||||||||||||||||
| Twelve Months Ended December 31, 2011 | |||||||||||||||||||
| Pro Forma | Pro Forma | Non-GAAP | Non-GAAP | ||||||||||||||||
|
(in thousands, except per share data) |
As Reported |
Adjustments | (unaudited) | Adjustments | (unaudited) | ||||||||||||||
| Net sales | |||||||||||||||||||
| Products | $ | 127,476 | $ | - | $ | 127,476 | $ | - | $ | 127,476 | |||||||||
| Services | 28,418 | - | 28,418 | - | 28,418 | ||||||||||||||
| 155,894 | - | 155,894 | - | 155,894 | |||||||||||||||
| Cost of sales | |||||||||||||||||||
| Products | 61,545 | - | 61,545 | (1,724 | ) | (a) | 59,821 | ||||||||||||
| Services | 11,945 | - | 11,945 | - | 11,945 | ||||||||||||||
| 73,490 | - | 73,490 | (1,724 | ) | 71,766 | ||||||||||||||
| Gross profit | 82,404 | - | 82,404 | 1,724 | 84,128 | ||||||||||||||
| Operating expenses | |||||||||||||||||||
| Research and development | 14,360 | - | 14,360 | - | 14,360 | ||||||||||||||
| Selling, general and administrative | 39,038 | - | 39,038 | (2,558 | ) | (b) | 36,480 | ||||||||||||
| 53,398 | - | 53,398 | (2,558 | ) | 50,840 | ||||||||||||||
| Operating income | 29,006 | - | 29,006 | 4,282 | 33,288 | ||||||||||||||
| Other income (expense) | |||||||||||||||||||
| Interest income, net | 923 | - | 923 | - | 923 | ||||||||||||||
| Foreign currency transaction losses, net | (888 | ) | - | (888 | ) | - | (888 | ) | |||||||||||
| Other, net | 2,311 | - | 2,311 | (1,830 | ) | (c) | 481 | ||||||||||||
| 2,346 | - | 2,346 | (1,830 | ) | 516 | ||||||||||||||
| Income before income taxes | 31,352 | - | 31,352 | 2,452 | 33,804 | ||||||||||||||
| Income tax expense | 10,726 | - | 10,726 | 601 | (d) | 11,327 | |||||||||||||
| Net income | $ | 20,626 | $ | - | $ | 20,626 | $ | 1,851 | $ | 22,477 | |||||||||
| Earnings per common share | |||||||||||||||||||
| Basic | $ | 0.98 | $ | - | $ | 0.98 | $ | 0.09 | $ | 1.06 | |||||||||
| Diluted | $ | 0.95 | $ | - | $ | 0.95 | $ | 0.09 | $ | 1.04 | |||||||||
|
Weighted average number of common shares outstanding |
|||||||||||||||||||
| Basic | 21,133 | 21,133 | 21,133 | ||||||||||||||||
| Diluted | 21,653 | 21,653 | 21,653 | ||||||||||||||||
|
(a) |
Represents amortization expense of $1.16 million related to acquired Solidscape, Inc. intangible assets and expense of $0.56 million for the revaluation of Solidscape, Inc. inventory at the time of acquisition. |
|
|
(b) |
Represents non-cash stock-based compensation expense of $1.59 million, amortization expense of $0.36 million related to acquired Solidscape, Inc. intangible assets and expense of $0.61 million for the acquisition of Solidscape, Inc. |
|
|
(c) |
Represents a gain of $1.20 million on the sale of an equity investment and a gain of $0.63 million on the sale of an auction rate security |
|
|
(d) |
Represents the tax benefit related to non-GAAP adjustments. |
|
| OBJET LTD. | ||||||||||||||||||||
| RECONCILIATION OF NON-GAAP TO GAAP RESULTS OF OPERATIONS | ||||||||||||||||||||
| Three Months Ended March 31, 2012 | ||||||||||||||||||||
| As Reported | Pro Forma | Pro Forma | Non-GAAP | Non-GAAP | ||||||||||||||||
|
(in thousands, except per share data) |
(unaudited) | Adjustments | (unaudited) | Adjustments | (unaudited) | |||||||||||||||
| Net sales | ||||||||||||||||||||
| Products | $ | 33,697 | $ | - | $ | 33,697 | $ | - | $ | 33,697 | ||||||||||
| Services | 4,378 | - | 4,378 | - | 4,378 | |||||||||||||||
| 38,075 | - | 38,075 | - | 38,075 | ||||||||||||||||
| Cost of sales | ||||||||||||||||||||
| Products | 9,911 | 7,489 | (a) | 17,400 | (7,010 | ) | (e) | 10,390 | ||||||||||||
| Services | 4,004 | 150 | (b) | 4,154 | (150 | ) | (b) | 4,004 | ||||||||||||
| 13,915 | 7,639 | 21,554 | (7,160 | ) | 14,394 | |||||||||||||||
| Gross profit | 24,160 | (7,639 | ) | 16,521 | 7,160 | 23,681 | ||||||||||||||
|
|
||||||||||||||||||||
| Operating expenses | ||||||||||||||||||||
| Research and development | 3,849 | 429 | (b) | 4,278 | (429 | ) | (b) | 3,849 | ||||||||||||
|
Selling, general and administrative |
16,171 | 2,434 | (c) | 18,605 | (5,971 | ) | (f) | 12,634 | ||||||||||||
| 20,020 | 2,863 | 22,883 | (6,400 | ) | 16,483 | |||||||||||||||
| Operating income | 4,140 | (10,502 | ) | (6,362 | ) | 13,560 | 7,198 | |||||||||||||
| Other income (expense) | ||||||||||||||||||||
| Other, net | (101 | ) | - | (101 | ) | - | (101 | ) | ||||||||||||
| (101 | ) | - | (101 | ) | - | (101 | ) | |||||||||||||
| Income before income taxes | 4,039 | (10,502 | ) | (6,463 | ) | 13,560 | 7,097 | |||||||||||||
| Income tax expense | 645 | (803 | ) | (d) | (158 | ) | 803 | (d) | 645 | |||||||||||
| Net income | $ | 3,394 | $ | (9,699 | ) | $ | (6,305 | ) | $ | 12,757 | $ | 6,452 | ||||||||
|
(a) |
Represents amortization expense of $6.87 million related to acquired Objet intangible assets, non-cash stock-based compensation expense of $0.14 million and a $0.48 million reclassification of shipping and handling costs from selling, general and administrative. |
|
|
(b) |
Represents non-cash stock-based compensation expense. |
|
|
(c) |
Represents amortization expense of $1.96 million related to acquired Objet intangible assets, non-cash stock-based compensation expense of $1.65 million, the elimination of $0.69 million of transaction costs related to the merger and a $0.48 million reclassification of shipping and handling costs to cost of sales. |
|
|
(d) |
Represents the tax benefit related to non-GAAP adjustments. |
|
|
(e) |
Represents amortization expense of $6.87 million related to acquired Objet intangible assets and non-cash stock-based compensation expense of $0.14 million. |
|
|
(f) |
Represents amortization expense of $1.96 million related to acquired Objet intangible assets, non-cash stock-based compensation expense of $1.65 million and expense of $2.37 million related to Objet's previously planned initial public offering. |
|
| OBJET LTD. | ||||||||||||||||||||
| RECONCILIATION OF NON-GAAP TO GAAP RESULTS OF OPERATIONS | ||||||||||||||||||||
| Twelve Months Ended December 31, 2011 | ||||||||||||||||||||
| Pro Forma | Pro Forma | Non-GAAP | Non-GAAP | |||||||||||||||||
| (in thousands, except per share data) | As Reported | Adjustments | (unaudited) | Adjustments | (unaudited) | |||||||||||||||
| Net sales | ||||||||||||||||||||
| Products | $ | 105,759 | $ | - | $ | 105,759 | $ | - | $ | 105,759 | ||||||||||
| Services | 15,337 | - | 15,337 | - | 15,337 | |||||||||||||||
| 121,096 | - | 121,096 | - | 121,096 | ||||||||||||||||
| Cost of sales | ||||||||||||||||||||
| Products | 34,008 | 30,042 | (a) | 64,050 | (28,141 | ) | (e) | 35,909 | ||||||||||||
| Services | 12,946 | 651 | (b) | 13,597 | (651 | ) | (b) | 12,946 | ||||||||||||
| 46,954 | 30,693 | 77,647 | (28,792 | ) | 48,855 | |||||||||||||||
| Gross profit | 74,142 | (30,693 | ) | 43,449 | 28,792 | 72,241 | ||||||||||||||
|
|
||||||||||||||||||||
| Operating expenses | ||||||||||||||||||||
| Research and development | 14,569 | 1,854 | (b) | 16,423 | (1,854 | ) | (b) | 14,569 | ||||||||||||
| Selling, general and administrative | 42,062 | 15,203 | (c) | 57,265 | (17,104 | ) | (f) | 40,161 | ||||||||||||
| 56,631 | 17,057 | 73,688 | (18,958 | ) | 54,730 | |||||||||||||||
| Operating income | 17,511 | (47,750 | ) | (30,239 | ) | 47,750 | 17,511 | |||||||||||||
| Other income (expense) | ||||||||||||||||||||
| Other, net | (1,228 | ) | - | (1,228 | ) | - | (1,228 | ) | ||||||||||||
| (1,228 | ) | - | (1,228 | ) | - | (1,228 | ) | |||||||||||||
| Income before income taxes | 16,283 | (47,750 | ) | (31,467 | ) | 47,750 | 16,283 | |||||||||||||
| Income tax expense | 1,589 | (3,458 | ) | (d) | (1,869 | ) | 3,458 | (d) | 1,589 | |||||||||||
| Net income | $ | 14,694 | $ | (44,292 | ) | $ | (29,598 | ) | $ | 44,292 | $ | 14,694 | ||||||||
|
(a) |
Represents amortization expense of $27.47 million related to acquired Objet intangible assets, non-cash stock-based compensation expense of $0.67 million and a $1.90 million reclassification of shipping and handling costs from selling, general and administrative. |
|
|
(b) |
Represents non-cash stock-based compensation expense. |
|
|
(c) |
Represents amortization expense of $7.82 million related to acquired Objet intangible assets, non-cash stock-based compensation expense of $9.28 million and a $1.90 million reclassification of shipping and handling costs to cost of sales. |
|
|
(d) |
Represents the tax benefit related to non-GAAP adjustments. |
|
|
(e) |
Represents amortization expense of $27.47 million related to acquired Objet intangible assets and non-cash stock-based compensation expense of $0.67 million. |
|
|
(f) |
Represents amortization expense of $7.82 million related to acquired Objet intangible assets and non-cash stock-based compensation expense of $9.28 million. |
|
| UNAUDITED CONDENSED COMBINED STATEMENTS OF OPERATIONS | ||||||||||||||||||||
| RECONCILIATION OF NON-GAAP TO GAAP RESULTS OF OPERATIONS | ||||||||||||||||||||
| Three Months Ended March 31, 2012 | ||||||||||||||||||||
| As Reported | Pro Forma | Pro Forma | Non-GAAP | Non-GAAP | ||||||||||||||||
| (in thousands, except per share data) | (unaudited) | Adjustments | (unaudited) | Adjustments | (unaudited) | |||||||||||||||
| Net sales | ||||||||||||||||||||
| Products | $ | 71,243 | $ | - | $ | 71,243 | $ | - | $ | 71,243 | ||||||||||
| Services | 11,796 | - | 11,796 | - | 11,796 | |||||||||||||||
| 83,039 | - | 83,039 | - | 83,039 | ||||||||||||||||
| Cost of sales | ||||||||||||||||||||
| Products | 27,721 | 7,489 | (a) | 35,210 | (7,446 | ) | (e) | 27,764 | ||||||||||||
| Services | 8,203 | 150 | (b) | 8,353 | (150 | ) | (b) | 8,203 | ||||||||||||
| 35,924 | 7,639 | 43,563 | (7,596 | ) | 35,967 | |||||||||||||||
| Gross profit | 47,115 | (7,639 | ) | 39,476 | 7,596 | 47,072 | ||||||||||||||
|
|
||||||||||||||||||||
| Operating expenses | ||||||||||||||||||||
| Research and development | 8,201 | 429 | (b) | 8,630 | (429 | ) | (b) | 8,201 | ||||||||||||
| Selling, general and administrative | 27,546 | 1,453 | (c) | 28,999 | (6,585 | ) | (f) | 22,414 | ||||||||||||
| 35,747 | 1,882 | 37,629 | (7,014 | ) | 30,615 | |||||||||||||||
| Operating income | 11,368 | (9,521 | ) | 1,847 | 14,610 | 16,457 | ||||||||||||||
| Other income (expense) | ||||||||||||||||||||
| Interest income, net | 250 | - | 250 | - | 250 | |||||||||||||||
| Foreign currency transaction losses, net | (52 | ) | - | (52 | ) | - | (52 | ) | ||||||||||||
| Other, net | (3 | ) | - | (3 | ) | - | (3 | ) | ||||||||||||
| 195 | - | 195 | - | 195 | ||||||||||||||||
| Income before income taxes | 11,563 | (9,521 | ) | 2,042 | 14,610 | 16,652 | ||||||||||||||
| Income tax expense | 3,647 | (803 | ) | (d) | 2,844 | 1,220 | (d) | 4,064 | ||||||||||||
| Net income | $ | 7,916 | $ | (8,718 | ) | $ | (802 | ) | $ | 13,390 | $ | 12,588 | ||||||||
| Earnings per common share | ||||||||||||||||||||
| Basic | $ | 0.22 | $ | (0.24 | ) | $ | (0.02 | ) | $ | 0.36 | $ | 0.34 | ||||||||
| Diluted | $ | 0.20 | $ | (0.22 | ) | $ | (0.02 | ) | $ | 0.34 | $ | 0.32 | ||||||||
|
Weighted average number of common shares outstanding |
||||||||||||||||||||
| Basic | 36,695 | 36,695 | 36,695 | |||||||||||||||||
| Diluted | 39,854 | 36,695 | 39,854 | |||||||||||||||||
|
(a) |
Represents amortization expense of $6.87 million related to acquired Objet intangible assets, non-cash stock-based compensation expense of $0.14 million and a $0.48 million reclassification of shipping and handling costs from selling, general and administrative. |
|
|
(b) |
Represents non-cash stock-based compensation expense. |
|
|
(c) |
Represents amortization expense of $1.96 million related to acquired Objet intangible assets, non-cash stock-based compensation expense of $1.65 million, the elimination of $1.67 million of transaction costs related to the merger and a $0.48 million reclassification of shipping and handling costs to cost of sales. |
|
|
(d) |
Represents the tax benefit related to non-GAAP adjustments. |
|
|
(e) |
Represents amortization expense of $7.30 million related to acquired intangible assets and non-cash stock-based compensation expense of $0.14 million. |
|
|
(f) |
Represents amortization expense of $2.09 million related to acquired intangible assets, non-cash stock-based compensation expense of $2.13 million, and expense of $2.37 million related to Objet's previously planned initial public offering |
|
| UNAUDITED CONDENSED COMBINED STATEMENTS OF OPERATIONS | ||||||||||||||||||||
| RECONCILIATION OF NON-GAAP TO GAAP RESULTS OF OPERATIONS | ||||||||||||||||||||
| Twelve Months Ended December 31, 2011 | ||||||||||||||||||||
| As Reported | Pro Forma | Pro Forma | Non-GAAP | Non-GAAP | ||||||||||||||||
| (in thousands, except per share data) | (unaudited) | Adjustments | (unaudited) | Adjustments | (unaudited) | |||||||||||||||
| Net sales | ||||||||||||||||||||
| Products | $ | 233,235 | $ | - | $ | 233,235 | $ | - | $ | 233,235 | ||||||||||
| Services | 43,755 | - | 43,755 | - | 43,755 | |||||||||||||||
| 276,990 | - | 276,990 | - | 276,990 | ||||||||||||||||
| Cost of sales | ||||||||||||||||||||
| Products | 95,553 | 30,042 | (a) | 125,595 | (29,865 | ) | (e) | 95,730 | ||||||||||||
| Services | 24,891 | 651 | (b) | 25,542 | (651 | ) | (b) | 24,891 | ||||||||||||
| 120,444 | 30,693 | 151,137 | (30,516 | ) | 120,621 | |||||||||||||||
| Gross profit | 156,546 | (30,693 | ) | 125,853 | 30,516 | 156,369 | ||||||||||||||
|
|
||||||||||||||||||||
| Operating expenses | ||||||||||||||||||||
| Research and development | 28,929 | 1,854 | (b) | 30,783 | (1,854 | ) | (b) | 28,929 | ||||||||||||
| Selling, general and administrative | 81,100 | 15,203 | (c) | 96,303 | (19,662 | ) | (f) | 76,641 | ||||||||||||
| 110,029 | 17,057 | 127,086 | (21,516 | ) | 105,570 | |||||||||||||||
| Operating income | 46,517 | (47,750 | ) | (1,233 | ) | 52,032 | 50,799 | |||||||||||||
| Other income (expense) | ||||||||||||||||||||
| Interest income, net | 923 | - | 923 | - | 923 | |||||||||||||||
| Foreign currency transaction losses, net | (888 | ) | - | (888 | ) | - | (888 | ) | ||||||||||||
| Other, net | 1,083 | - | 1,083 | (1,830 | ) | (g) | (747 | ) | ||||||||||||
| 1,118 | - | 1,118 | (1,830 | ) | (712 | ) | ||||||||||||||
| Income before income taxes | 47,635 | (47,750 | ) | (115 | ) | 50,202 | 50,087 | |||||||||||||
| Income tax expense | 12,315 | (3,458 | ) | (d) | 8,857 | 4,059 | (d) | 12,916 | ||||||||||||
| Net income | $ | 35,320 | $ | (44,292 | ) | $ | (8,972 | ) | $ | 46,143 | $ | 37,171 | ||||||||
| Earnings per common share | ||||||||||||||||||||
| Basic | $ | 0.97 | $ | (1.21 | ) | $ | (0.25 | ) | $ | 1.26 | $ | 1.02 | ||||||||
| Diluted | $ | 0.90 | $ | (1.21 | ) | $ | (0.25 | ) | $ | 1.17 | $ | 0.94 | ||||||||
|
Weighted average number of common shares outstanding |
||||||||||||||||||||
| Basic | 36,562 | 36,562 | 36,562 | |||||||||||||||||
| Diluted | 39,436 | 36,562 | 39,436 | |||||||||||||||||
|
(a) |
Represents amortization expense of $27.47 million related to acquired Objet intangible assets, non-cash stock-based compensation expense of $0.67 million and a $1.90 million reclassification of shipping and handling costs from selling, general and administrative. |
|
|
(b) |
Represents non-cash stock-based compensation expense. |
|
|
(c) |
Represents amortization expense of $7.82 million related to acquired Objet intangible assets, non-cash stock-based compensation expense of $9.28 million and a $1.90 million reclassification of shipping and handling costs to cost of sales. |
|
|
(d) |
Represents the tax benefit related to non-GAAP adjustments. |
|
|
(e) |
Represents amortization expense of $28.63 million related to acquired intangible assets, non-cash stock-based compensation expense of $0.67 million and expense of $0.56 million for the revaluation of Solidscape, Inc. inventory at the time of acquisition. |
|
|
(f) |
Represents amortization expense of $8.18 million related to acquired intangible assets, non-cash stock-based compensation expense of $10.87 million and expense of $0.61 million for the acquisition of Solidscape, Inc. |
|
|
(g) |
Represents a gain of $1.20 million on the sale of an equity investment and a gain of $0.63 million on the sale of an auction rate security |
