Materialise Reports First Quarter 2022 Results

LEUVEN, Belgium--(BUSINESS WIRE)--Apr. 28, 2022-- Materialise NV (NASDAQ:MTLS), a leading provider of additive manufacturing and medical software and of sophisticated 3D printing services, today announced its financial results for the first quarter ended March 31, 2022.

Highlights – First Quarter 2022

  • Total revenue increased 16.3% to 52,961 kEUR compared to 45,554 kEUR for the first quarter of 2021.
  • Total deferred revenues from annual software sales and maintenance fees increased by 2,937 kEUR this quarter to 38,082 kEUR.
  • Adjusted EBITDA increased to 5,443 kEUR for the first quarter of 2022 from 5,341 kEUR for the 2021 period.
  • Net profit for the first quarter of 2022 was 127 kEUR, or 0.0 EUR per diluted share, compared to (3,642) kEUR, or (0.07) EUR per diluted share, for the 2021 period.

Executive Chairman Peter Leys commented, “While the global economy was negatively impacted by a combination of geopolitical instability and the COVID-19 pandemic, Materialise continued to perform well. After posting record numbers for 2021, all of our segments grew during the first quarter of 2022, with an aggregate revenue increase of 16% on a consolidated basis, driven by the continued recovery of Materialise Manufacturing. We are particularly pleased that our deferred revenue from annual software sales and maintenance fees increased significantly, underscoring the solid recurring sales performance of our Materialise Software and Materialise Medical segments. Moreover, our Adjusted EBITDA for the quarter was 5,443 kEUR, slightly above last year’s, and included the continued operational investments in Link3D, a developer of AM manufacturing execution systems that we acquired on January 4, 2022.”

First Quarter 2022 Results

Total revenue for the first quarter of 2022 increased 16.3% to 52,961 kEUR from 45,554 kEUR for the first quarter of 2021. Adjusted EBITDA increased to 5,443 kEUR for the first quarter of 2022 from 5,341 kEUR for the 2021 period. The Adjusted EBITDA margin (Adjusted EBITDA divided by total revenue) for the first quarter of 2022 was 10.3%, compared to 11.7% for the first quarter of 2021.

The results of Link3D have been fully consolidated with the results of our Materialise Software segment as of the beginning of this year. Revenue from Materialise Software increased 2.6% to 10,483 kEUR for the first quarter of 2022 from 10,219 kEUR for the same quarter last year. Segment EBITDA decreased, including the effect of ongoing investments in Link3D, to 1,932 kEUR from 3,429 kEUR while the segment EBITDA margin was 18.4% compared to 33.6% for the prior-year period.

Revenue from our Materialise Medical segment increased 13.0% to 18,347 kEUR for the first quarter of 2022 compared to 16,231 kEUR for the same period in 2021. Segment EBITDA amounted to 3,227 kEUR for the first quarter of 2022 compared to 4,541 kEUR while the segment EBITDA margin was 17.6% compared to 28.0% for the first quarter of 2021.

Revenue from our Materialise Manufacturing segment increased 26.2% to 24,131 kEUR for the first quarter of 2022 from 19,114 kEUR for the first quarter of 2021. Segment EBITDA increased to 2,613 kEUR from (144) kEUR while the segment EBITDA margin grew to 10.8% compared to (0.8)% for the first quarter of 2021.

Gross profit grew to 28,884 kEUR compared to 24,568 kEUR for the same period last year, while gross profit as a percentage of revenue increased to 54.5% compared to 53.9% for the first quarter of 2021.

Research and development (“R&D”), sales and marketing (“S&M”) and general and administrative (“G&A”) expenses increased, in the aggregate, 17.2% to 29,773 kEUR for the first quarter of 2022 from 25,398 kEUR for the first quarter of 2021.

Net other operating income was 938 kEUR compared to 1,120 kEUR for the first quarter of 2021.

Operating result amounted to 49 kEUR compared to 290 kEUR for the first quarter of 2021.

Net financial result was 376 kEUR compared to (4,112) kEUR for the first quarter of 2021.

The first quarter of 2022 contained income tax expenses of (298) kEUR, compared to 181 kEUR income tax income in the first quarter of 2021.

As a result of the above, net profit for the first quarter of 2022 was 127 kEUR, compared to (3,642) kEUR for the same period in 2021. Total comprehensive income for the first quarter of 2022, which includes exchange differences on translation of foreign operations, was 1,543 kEUR compared to (3,150) kEUR for the 2021 period.

At March 31, 2022, we had cash and cash equivalents of 169,610 kEUR compared to 196,028 kEUR at December 31, 2021. Gross debt amounted to 93,583 kEUR, compared to 99,107 kEUR at December 31, 2021. As a result, our net cash position (gross debt less cash and cash equivalents) was 76,027 kEUR, a decrease of 20,894 kEUR, and included the effect of our call option exercise to acquire 100% of the shares of Link3D.

Cash flow from operating activities for the first quarter of 2022 increased to 11,111 kEUR from 4,231 kEUR for the same period in 2021. Total capital expenditures for the first quarter of 2022 amounted to 3,499 kEUR.

Net shareholders’ equity at March 31, 2022 was 234,121 kEUR compared to 232,577 kEUR at December 31, 2021.

Non-IFRS Measures

Materialise uses EBITDA and Adjusted EBITDA as supplemental financial measures of its financial performance. EBITDA is calculated as net profit plus income taxes, financial expenses (less financial income), shares of profit or loss in a joint venture and depreciation and amortization. Adjusted EBITDA is determined by adding share-based compensation expenses, acquisition-related expenses of business combinations, impairments and revaluation of fair value due to business combinations to EBITDA. Management believes these non-IFRS measures to be important measures as they exclude the effects of items which primarily reflect the impact of long-term investment and financing decisions, rather than the performance of the company’s day-to-day operations. As compared to net profit, these measures are limited in that they do not reflect the periodic costs of certain capitalized tangible and intangible assets used in generating revenues in the company’s business, or the charges associated with impairments. Management evaluates such items through other financial measures such as capital expenditures and cash flow provided by operating activities. The company believes that these measurements are useful to measure a company’s ability to grow or as a valuation measurement. The company’s calculation of EBITDA and Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies. EBITDA and Adjusted EBITDA should not be considered as alternatives to net profit or any other performance measure derived in accordance with IFRS. The company’s presentation of EBITDA and Adjusted EBITDA should not be construed to imply that its future results will be unaffected by unusual or non-recurring items.

Non-IFRS Measures

Materialise uses EBITDA and Adjusted EBITDA as supplemental financial measures of its financial performance. EBITDA is calculated as net profit plus income taxes, financial expenses (less financial income), shares of profit or loss in a joint venture and depreciation and amortization. Adjusted EBITDA is determined by adding share-based compensation expenses, acquisition-related expenses of business combinations, impairments and revaluation of fair value due to business combinations to EBITDA. Management believes these non-IFRS measures to be important measures as they exclude the effects of items which primarily reflect the impact of long-term investment and financing decisions, rather than the performance of the company’s day-to-day operations. As compared to net profit, these measures are limited in that they do not reflect the periodic costs of certain capitalized tangible and intangible assets used in generating revenues in the company’s business, or the charges associated with impairments. Management evaluates such items through other financial measures such as capital expenditures and cash flow provided by operating activities. The company believes that these measurements are useful to measure a company’s ability to grow or as a valuation measurement. The company’s calculation of EBITDA and Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies. EBITDA and Adjusted EBITDA should not be considered as alternatives to net profit or any other performance measure derived in accordance with IFRS. The company’s presentation of EBITDA and Adjusted EBITDA should not be construed to imply that its future results will be unaffected by unusual or non-recurring items.

Exchange Rate

This document contains translations of certain euro amounts into U.S. dollars at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from euros to U.S. dollars in this document were made at a rate of EUR 1.00 to USD 1.1101, the reference rate of the European Central Bank on March 31, 2022.

Conference Call and Webcast

Materialise will hold a conference call and simultaneous webcast to discuss its financial results for the first quarter of 2022 on Thursday, April 28, 2022, at 8:30 a.m. ET/2:30 p.m. CET. Company participants on the call will include Wilfried Vancraen, Founder and Chief Executive Officer; Peter Leys, Executive Chairman; and Johan Albrecht, Chief Financial Officer. A question-and-answer session will follow management’s remarks.

To access the conference call, please dial 844-469-2530 (U.S.) or 765-507-2679 (international), passcode 2437458#.
The conference call will also be broadcast live over the Internet with an accompanying slide presentation, which can be accessed on the company’s website at https://investors.materialise.com. A webcast of the conference call will be archived on the company's website for one year.

Consolidated income statements (Unaudited)

   
     
    for the three months ended
March 31,
In '000  

2022

 

2022

 

2021*

    U.S.$    
Revenue  

58,792

 

 

52,961

 

 

45,554

 

Cost of Sales  

(26,729)

 

 

(24,078)

 

 

(20,986)

 

Gross Profit  

32,064

 

 

28,884

 

 

24,568

 

Gross profit as % of revenue  

54.5

%

 

54.5

%

 

53.9

%

             
Research and development expenses  

(8,675)

 

 

(7,814)

 

 

(6,536)

 

Sales and marketing expenses  

(15,003)

 

 

(13,515)

 

 

(11,310)

 

General and administrative expenses  

(9,373)

 

 

(8,444)

 

 

(7,552)

 

Net other operating income (expenses)  

1,041

 

 

938

 

 

1,120

 

Operating (loss) profit  

54

 

 

49

 

 

290

 

             
Financial expenses  

(1,431)

 

 

(1,289)

 

 

(4,701)

 

Financial income  

1,849

 

 

1,665

 

 

589

 

Share in loss of joint venture  

-

 

 

-

 

 

-

 

(Loss) profit before taxes  

472

 

 

425

 

 

(3,822)

 

             
Income Taxes (*)  

(331)

 

 

(298)

 

 

181

 

Net (loss) profit for the period (*)  

141

 

 

127

 

 

(3,642)

 

Net (loss) profit attributable to:  

-

 

       
The owners of the parent  

148

 

 

134

 

 

(3,642)

 

Non-controlling interest  

(7)

 

 

(7)

 

 

-

 

             
Earning per share attributable to owners of the parent        
Basic  

0.00

 

 

0.00

 

 

(0.07)

 

Diluted  

0.00

 

 

0.00

 

 

(0.07)

 

             
Weighted average basic shares outstanding  

59,064

 

 

59,064

 

 

54,169

 

Weighted average diluted shares outstanding  

59,102

 

 

59,102

 

 

54,169

 

(*) The year 2021 has been restated to reflect the final accounting of the business combination with RS Print.

Impact on Net profit for the period and on Income taxes is 26 k€

Consolidated statements of comprehensive income (Unaudited)

   
     

 

  for the three months ended
March 31,
In 000€  

2022

 

2022

 

2021(*)

    U.S.$    
Net profit (loss) for the period (*)  

141

 

 

127

 

 

(3,642)

 

Other comprehensive income            
Recycling            
Exchange difference on translation of foreign operations  

1,572

 

 

1,416

 

 

492

 

Non-recycling            
Fair value adjustments through OCI - Equity instruments  

-

 

 

-

 

 

-

 

Other comprehensive income (loss), net of taxes  

1,572

 

 

1,416

 

 

492

 

Total comprehensive income (loss) for the year, net of taxes  

1,713

 

 

1,543

 

 

(3,150)

 

Total comprehensive income (loss) attributable to:            
The owners of the parent  

1,720

 

 

1,549

 

 

(3,150)

 

Non-controlling interests  

(7)

 

 

(7)

 

 

-

 

(*) The year 2021 has been restated to reflect the final accounting of the business combination with RS Print.

Impact on Net profit for the period is 26k€.

Consolidated statement of financial position (Unaudited)

       
         
    As of
March 31,
  As of
December 31,
In 000€  

2022

 

2021

Assets        
Non-current assets        
Goodwill  

43,548

 

18,726

Intangible assets  

38,075

 

31,668

Property, plant & equipment  

84,329

 

84,451

Right-of-Use assets  

9,270

 

9,054

Investments in joint ventures  

-

 

-

Deferred tax assets  

393

 

227

Investments in convertible loans  

3,622

 

3,560

Investments in non-listed equity instruments  

399

 

399

Other non-current assets  

5,404

 

7,520

Total non-current assets  

185,040

 

155,605

Current assets        
Inventories  

12,720

 

11,295

Trade receivables  

38,575

 

41,541

Other current assets  

8,169

 

8,940

Cash and cash equivalents  

169,610

 

196,028

Total current assets  

229,074

 

257,803

Total assets  

414,115

 

413,408

    As of
March 31,
  As of
December 31,
In 000€  

2022

 

2021

Equity and liabilities        
Equity        
Share capital  

4,489

 

 

4,489

 

Share premium  

233,872

 

 

233,872

 

Retained earnings and other reserves  

(4,240)

 

 

(5,784)

 

Equity attributable to the owners of the parent  

234,121

 

 

232,577

 

Non-controlling interest  

(6)

 

 

1

 

Total equity  

234,115

 

 

232,578

 

Non-current liabilities        
Loans & borrowings  

66,759

 

 

72,637

 

Lease liabilities  

5,670

 

 

5,268

 

Deferred tax liabilities  

4,295

 

 

4,371

 

Deferred income  

5,555

 

 

4,952

 

Other non-current liabilities  

2,681

 

 

2,168

 

Total non-current liabilities  

84,960

 

 

89,396

 

Current liabilities        
Loans & borrowings  

17,882

 

 

17,849

 

Lease liabilities  

3,272

 

 

3,353

 

Trade payables  

20,202

 

 

20,171

 

Tax payables  

722

 

 

783

 

Deferred income  

37,226

 

 

33,306

 

Other current liabilities  

15,736

 

 

15,972

 

Total current liabilities  

95,040

 

 

91,434

 

Total equity and liabilities  

414,115

 

 

413,408

 

Consolidated statement of cash flows (Unaudited)

   
     
    for the three months ended
March 31,
In 000€  

2022

 

2021*

Operating activities        
Net (loss) profit for the period (*)  

127

 

 

(3,642)

 

Non-cash and operational adjustments        
Depreciation of property plant & equipment  

3,840

 

 

3,803

 

Amortization of intangible assets  

1,602

 

 

1,277

 

Impairment of goodwill and intangible assets  

-

 

 

-

 

Share-based payment expense  

(48)

 

 

(415)

 

Loss (gain) on disposal of property, plant & equipment  

(18)

 

 

(32)

 

Movement in provisions  

2

 

 

-

 

Movement reserve for bad debt and slow moving inventory  

130

 

 

(2)

 

Financial income  

(1,618)

 

 

(589)

 

Financial expense  

1,237

 

 

4,701

 

Impact of foreign currencies  

(28)

 

 

18

 

Share in loss (gain) of a joint venture (equity method)  

-

 

 

-

 

(Deferred) income taxes (*)  

302

 

 

(181)

 

Other non-current liabilities  

-

 

 

-

 

Working capital adjustments  

5,923

 

 

(860)

 

Decrease (increase) in trade receivables and other receivables  

4,506

 

 

(931)

 

Decrease (increase) in inventories and contracts in progress  

(1,357)

 

 

(329)

 

Increase (decrease) in trade payables and other payables  

2,774

 

 

400

 

Income tax paid & Interest received  

(341)

 

 

153

 

Net cash flow from operating activities  

11,111

 

 

4,231

 

(*) The year 2021 has been restated to reflect the final accounting of the business combination with RS Print.
Impact on Net profit for the period and on (Deferred) income taxes is 26 k€.

    for the three months ended
March 31,
In 000€  

2022

 

2021

Investing activities        
Purchase of property, plant & equipment  

(2,376)

 

 

(1,242)

 

Purchase of intangible assets  

(1,123)

 

 

(768)

 

Proceeds from the sale of property, plant & equipment & intangible assets (net)  

93

 

 

183

 

Acquisition of subsidiary (net of cash)  

(27,414)

 

 

-

 

(Convertible) Loans granted  

-

 

 

(1,122)

 

Other equity investments in non-listed entities  

-

 

 

-

 

Net cash flow used in investing activities  

(30,820)

 

 

(2,949)

 

Financing activities        
Repayment of loans & borrowings  

(5,969)

 

 

(3,918)

 

Repayment of leases  

(881)

 

 

(1,066)

 

Capital increase  

-

 

 

-

 

Interest paid  

(515)

 

 

(536)

 

Other financial income (expense)  

(89)

 

 

136

 

Net cash flow from (used in) financing activities  

(7,452)

 

 

(5,384)

 

Net increase/(decrease) of cash & cash equivalents  

(27,161)

 

 

(4,102)

 

Cash & Cash equivalents at the beginning of the year  

196,028

 

 

111,538

 

Exchange rate differences on cash & cash equivalents  

743

 

 

132

 

Cash & cash equivalents at end of the period  

169,610

 

 

107,568

 

Reconciliation of Net Profit (Loss) to EBITDA and Adjusted EBITDA (Unaudited)

Reconciliation of Net Profit (Loss) to EBITDA and Adjusted EBITDA (Unaudited)

   
     
    for the three months ended
March 31,
In 000€  

2022

 

2021 (*)

Net profit (loss) for the period (*)  

127

 

 

(3,642)

 

Income taxes (*)  

298

 

 

(181)

 

Financial expenses  

1,289

 

 

4,701

 

Financial income  

(1,665)

 

 

(589)

 

Depreciation and amortization  

5,442

 

 

5,081

 

Share in loss of joint venture  

-

 

 

-

 

EBITDA  

5,491

 

 

5,371

 

Share-based compensation expense (1)  

(48)

 

 

(415)

 

Acquisition-related expenses of business combinations (2)  

-

 

 

385

 

Adjusted EBITDA  

5,443

 

 

5,341

 

(1) Share-based compensation expense represents the cost of equity-settled and share-based payments to employees.
(2) Acquisition-related expenses of business combinations represents expenses incurred in connection with the acquisition of our option to buy Link3D
(*) The year 2021 has been restated to reflect the final accounting of the business combination with RS Print.
Impact on Net profit for the period and Income taxes is 26 k€.

Segment P&L (Unaudited)

                       
                         
In 000€   Materialise
Software
  Materialise
Medical
  Materialise
Manufacturing
  Total
segments
  Unallocated (1)   Consolidated
For the three months ended March 31, 2022                        
Revenues  

10,483

 

 

18,347

 

 

24,131

 

 

52,961

 

 

0

 

 

52,961

 

Segment (adj) EBITDA  

1,932

 

 

3,227

 

 

2,613

 

 

7,772

 

 

(2,329)

 

 

5,443

 

Segment (adj) EBITDA %  

18.4

%

 

17.6

%

 

10.8

%

 

14.7

%

     

10.3

%

For the three months ended March 31, 2021                        
Revenues  

10,219

 

 

16,231

 

 

19,114

 

 

45,564

 

 

(11)

 

 

45,553

 

Segment (adj) EBITDA  

3,429

 

 

4,541

 

 

(144)

 

 

7,826

 

 

(2,486)

 

 

5,341

 

Segment (adj) EBITDA %  

33.6

%

 

28.0

%

 

-0.8

%

 

17.2

%

     

11.7

%

(1) Unallocated segment adjusted EBITDA consists of corporate research and development, corporate headquarter costs and corporate other operating income (expense), and the added share-based compensation expenses, acquisition related expenses of business combinations, impairments and fair value of business combinations that are included in Adjusted EBITDA.

Reconciliation of Net Profit (Loss) to Segment adjusted EBITDA (Unaudited)

   
     
    for the three months ended
March 31,
In 000€  

2022

 

2021 (*)

Net profit (loss) for the period (*)  

127

 

 

(3,642)

 

Income taxes (*)  

298

 

 

(181)

 

Financial cost  

1,289

 

 

4,701

 

Financial income  

(1,665)

 

 

(589)

 

Share in loss of joint venture  

-

 

 

-

 

         
Operating (loss) profit  

49

 

 

289

 

         
Depreciation and amortization  

5,442

 

 

5,081

 

Corporate research and development  

816

 

 

692

 

Corporate headquarter costs  

2,106

 

 

2,648

 

Other operating income (expense)  

(640)

 

 

(855)

 

         
Segment adjusted EBITDA  

7,772

 

 

7,855

 

(*)The year 2021 has been restated to reflect the final accounting of the business combination with RS Print.

Impact on Net profit for the period and Income taxes is 26 k€.

About Materialise

Materialise incorporates 30 years of 3D printing experience into a range of software solutions and 3D printing services, which form the backbone of the 3D printing industry. Materialise’s open and flexible solutions enable players in a wide variety of industries, including healthcare, automotive, aerospace, art and design, and consumer goods, to build innovative 3D printing applications that aim to make the world a better and healthier place. Headquartered in Belgium, with branches worldwide, Materialise combines one of the largest groups of software developers in the industry with one of the largest 3D printing facilities in the world. For additional information, please visit: www.materialise.com.

Cautionary Statement on Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, regarding, among other things, our intentions, beliefs, assumptions, projections, outlook, analyses or current expectations, plans, objectives, strategies and prospects, both financial and business, including statements concerning, among other things, our results of operations, cash needs, capital expenditures, expenses, financial condition, liquidity, prospects, growth and strategies (including how our business, results of operations and financial condition could be impacted by the current armed conflict in Ukraine and the COVID-19 pandemic and related public health measures, as well as the related actions we are taking in response), and the trends and competition that may affect the markets, industry or us. Such statements are subject to known and unknown uncertainties and risks. When used in this press release, the words “estimate,” “expect,” “anticipate,” “project,” “plan,” “intend,” “believe,” “forecast,” “will,” “may,” “could,” “might,” “aim,” “should,” and variations of such words or similar expressions are intended to identify forward-looking statements. These forward-looking statements are based upon the expectations of management under current assumptions at the time of this press release. These expectations, beliefs and projections are expressed in good faith and the company believes there is a reasonable basis for them. However, the company cannot offer any assurance that our expectations, beliefs and projections will actually be achieved. By their nature, forward-looking statements involve risks and uncertainties because they relate to events, competitive dynamics and industry change, and depend on economic circumstances that may or may not occur in the future or may occur on longer or shorter timelines than anticipated. We caution you that forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors that are in some cases beyond our control. All of the forward-looking statements are subject to risks and uncertainties that may cause the company's most recent actual results to differ materially from our expectations, including risk factors described in the company's most recent annual report on Form 20-F filed with the U.S. Securities and Exchange Commission. There are a number of risks and uncertainties that could cause the company's actual results to differ materially from the forward-looking statements contained in this press release.

The company is providing this information as of the date of this press release and does not undertake any obligation to update any forward-looking statements contained in this press release as a result of new information, future events or otherwise, unless it has obligations under the federal securities laws to update and disclose material developments related to previously disclosed information.

Press contacts:

Investor Relations
LHA
Harriet Fried,
212-838-3777
hfried@lhai.com
Source: Materialise NV

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