voxeljet, a leading provider of high-speed, large-format industrial 3D printers, closed fiscal 2016 with revenues declining by 7.2% to €22.3 million compared €24 million in the prior year period. The publicly traded company, whose stock has been struggling on for the best part of the last two years, defined 2016 a “challenging but nonetheless successful, transition year”.
Systems revenues were €13.1 million for the year ended December 31, 2016 compared to €11 in last year’s period. The Company sold fifteen new and three used and refurbished 3D printers during the year ended December 31, 2016 compared to fourteen new and four used and refurbished 3D printers in the prior year period. Systems revenues represented 58.6% of total revenue for the year ended December 31, 2016 compared to 46.2% for the same period a year ago.
“We concluded a challenging but nonetheless successful transition year 2016. By expanding our global footprint and by further improving our internal processes, we have successfully laid the foundation for future profitable growth. We are proud to say our US operations reached a significant milestone in becoming profitable measured on net profit in the last quarter of 2016. In doing so, it will serve as the benchmark for our operations in the UK, India and China. We continue to strongly execute on our Strategy 2020 and are excited about the growing number of opportunities around the world.” Dr. Ingo Ederer, Chief Executive Officer of voxeljet.
Services revenues amounted to €9.3 million for the year ended December 31, 2016 compared €13 million for the same period last year. This decrease was mainly due to the lower revenue contribution from subsidiary voxeljet UK that amounted to €769,000 in 2016 compared to €4.7 million in 2015. Moreover, revenue contribution from the German operation for 2016 was €1.3 million lower than in the last year’s same period due to lower market demand. This decrease was partially offset by a significantly higher revenue contribution by voxeljet America that increased to €2.032 milllion compared to €532,000 in 2015.
Cost of sales for the year ended December 31, 2016 was € 15.435 milllion, a decrease of € 1.712 milllion, or 10% compared to cost of sales amounting to € 17,147 for the same period in 2015.
Gross profit and gross margin for the year ended December 31, 2016 were kEUR 6,903 and 30.9%, respectively, compared to € 6.917 milllion and 28.7% in the prior year period.
Gross profit for our Systems segment decreased to € 3.197 milllion for the year ended December 31, 2016 from € 3,849 in the same period of 2015. The gross profit margin for this segment decreased to 24.4% compared to 34.6% for the prior period. This decrease is mainly due to an allowance for slow-moving inventory of € 954 which was recognized within cost of sales in 2016.
Gross profit for our Services segment increased to € 3.706 milllion for the year ended December 31, 2016 from € 3,068 in the same period of 2015. The gross profit margin for this segment increased to 40.0% from 23.7%. The gross profit margin improved as in the year 2015 we recognized € 2.663 milllion related to the restructuring of voxeljet UK within cost of sales. In addition, the higher utilization rates regarding voxeljet America improved gross profit and gross profit margin within this segment. This was partially offset by a slight decline regarding gross profit and gross profit margin contribution from the German operation.
Selling expenses were € 5. 312 milllion for the year ended December 31, 2016 compared to € 6,922 in the same period in 2015, a decrease of € 1,610, or 23.3%. Administrative expenses decreased by € 615 to € 4,563 for the year ended December 31, 2016 from € 5.178 milllion in the prior year period. The decrease of selling expenses and administrative expenses was mainly due to the restructuring of voxeljet UK, which provided significant cost savings.
Research and development expenses slightly increased to € 5.683 milllion for the year ended December 31, 2016 from € 5,470 in the same period in 2015, an increase of € 213, or 3.9%.
Other operating expenses for the year ended December 31, 2016 were € 3.881milllioncompared to € 888,000 in the prior year period. This was mainly due to the impairment of goodwill of € 1,130 related to our UK operations and impairment of trade receivables from our most significant customer in UK amounting to kEUR 293, as well as foreign currency losses amounting to € 2,077 compared to € 210 in the same period in 2015.
The significant gains and losses from foreign currency transactions were primarily driven by the valuation of the intercompany loans granted by the parent company to our UK and US subsidiaries. The loans are denominated in GBP and USD, respectively.
Other operating income was € 1.417 million for the year ended December 31, 2016 compared to € 2.130 million in the prior year period. The decrease was mainly due to lower gains from government grants amounting to € 75,000 compared to € 322,000 in comparative period and lower gains from foreign currency transactions of €645,000 compared to € 863,000 in 2015.
Net loss for the year ended December 31, 2016 was € 11.313 milllion, or € 3.04 per share, as compared to net loss of € 9.594 milllion or € 2.58 per share in the prior year period. This is based on a weighted average number of ordinary shares outstanding of 3.720 million for the full year ended December 31, 2016. Compared to the last year’s same period, the number of ordinary shares outstanding was unchanged.
Based on a conversion rate of five ADSs per ordinary share, net loss was € 0.61 per ADS for the year ended December 31, 2016 compared to net loss of € 0.52 per ADS in the prior year period.
Although 2016 was undeniably a difficult year, voxeljet has been building for the future and its products do have a market, although possibly not as large as some – including the author of this article – had initially imagined. The company expects to optimize its best practices and is reaffirming guidance for the full year ended December 31, 2017.
- Revenue is expected to be in the range of € 26 milllion and € 28,000 milllion
- Gross margin is expected to be above 40%
- Operating expenses for the full year are expected as follows: SG&A expenses in the range of € 9,250 and kEUR 10,250 and R&D expenses to be approximately€ 4,750 to€ 5,750. Depreciation and amortization expense is expected to be between € 3,000 and € 4,000.
- EBITDA is expected to be neutral-to-positive in 2017
- Capital expenditures are projected to be in the range of € 8,000 to € 9,000, which primarily includes ongoing investments in our global subsidiaries.
Our total backlog of 3D printer orders at December 31, 2016 was € 3.784 milllion, which represents five 3D printers. This compares to a backlog of € 5,613 representing nine 3D printers, at December 31, 2015. As production and delivery of our printers is generally characterized by lead times ranging between three to nine months, the conversion rate of order backlog into revenue is dependent on the equipping process for the respective 3D printer as well as the timing of customers’ requested deliveries.
At December 31, 2016, the company had cash and cash equivalents of € 7.849 milllion and held € 12.579 milllion of investments in bond funds and a note receivable, both of which are included in current financial assets on our consolidated statements of financial position.