3D Systems Corporation EBITDA surged on 99.6% and Revenue increased on 6.4%
02/28/2019 • About 3D Systems Corporation (
$DDD) • By InTwits
3D Systems Corporation reported 2018 financial results today. Overall the company's long term financial model is characterised by the following facts:
- 3D Systems Corporation spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for 2014-2018 is 4.7%. Average EBITDA Margin for the same period was -13.1%
- 3D Systems Corporation has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.0%. At the same time it's in pair with industry average of 5.2%
- CAPEX is quite volatile: $41m in 2018, $31m in 2017, $17m in 2016, $22m in 2015, $23m in 2014
- In the last 5 years the company invested considerably less than D&A: $133m vs. $320m. In 2018 this situation was still the same: CAPEX was 41 while D&A was 59
- The company has unprofitable business model: ROIC is -6.6%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue increased on 6.4%. Revenue growth showed slowdown in 18Q4 - it was 1.9% YoY. During 2014-2018 Revenue growth bottomed in 2016 at -5.0% and was accelerating since that time. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 10.3 pp from 18.8% to 8.5% in FY2018.
Gross Margin showed almost no change in 2018. SG&A as a % of Revenue decreased slightly on 1.3 pp from 40.9% to 39.6% in 2018. During 2014-2018 SG&A as a % of Revenue topped in 2015 at 45.6% and was declining since that time. Stock Based Compensation (SBC) as a % of Revenue showed almost no change in 2018.
Net Income margin increased on 3.6 pp from -10.2% to -6.6% in 2018.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 5.9% in 2018. 3D Systems Corporation's CAPEX/Revenue increased on 2.6 pp from 3.4% in 2015 to 5.9% in 2018. For the last three years the average CAPEX/Revenue was 4.4%. The company investments to CAPEX were large: 253% of EBITDA. During the last 5 years CAPEX as a % of Revenue bottomed in 2016 at 2.6% and was growing since that time.
Accounts receivable as a % of Revenue decreased slightly on 1.7 pp from 20.1% to 18.4% in 2018. Inventories as a % of Revenue increased on 3.3 pp from 16.1% to 19.4% in 2018. Accounts payable as a % of Revenue increased on 2.1 pp from 16.3% to 18.4% in 2018.
Return on investment
The company operates at negative ROIC (-6.6%) and ROE (-7.6%). ROIC increased slightly on 1.5 pp from -8.1% to -6.6% in 2018. ROE increased on 2.9 pp from -10.5% to -7.6% in 2018.
Leverage (Debt)
Company's Net Debt / EBITDA is -4.8x and Debt / EBITDA is 2.0x. Debt surged on 315% while cash dropped on 19.3%.
3D Systems Corporation has no short term refinancing risk: cash is higher than short term debt (16,819.3%).
Average interest expence charged on company's debt was 8.3% in 2018.
Management team
Vyomesh I Joshi is a the company's CEO. Vyomesh I Joshi is a founder and has spent 3 years with the company. CEO total compensation was
$2,122,615 in 2018 which included
$953,000 salary. The company's CFO is John N Mcmullen. John N Mcmullen has 3 years tenure at the company.
At the end of financial year the company had 3.8% shares owned by insiders. Insider ownership didn't change in 2018.
At the end of financial year the company had 2,620 employees. The number of employees decreased slightly on 1.7%. Average revenue per employee in 2018 was
$262,466 and it increased on 8.3%.
Financial and operational results
FY ended 12/31/2018
3D Systems Corporation ($DDD) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 653.7 | 666.2 | 633.0 | 646.1 | 687.7 | 6.4% |
| Gross Profit | 317.4 | 291.8 | 309.8 | 304.8 | 324.4 | 6.4% |
| SG&A | 215.7 | 303.8 | 259.8 | 264.2 | 272.3 | 3.1% |
| EBITDA | 81.5 | -558.9 | 22.1 | 8.1 | 16.1 | 99.6% |
| EBIT | 26.3 | -641.9 | -38.4 | -54.0 | -43.2 | |
| Interest expence | 1.2 | 2.0 | 1.3 | 0.9 | 2.6 | 188.2% |
| Tax | 5.4 | 9.0 | -0.5 | 7.8 | 2.0 | -73.9% |
| Net Income | 11.6 | -655.5 | -38.4 | -66.2 | -45.5 | |
| Stock Based Compensation | 32.8 | 34.7 | 31.3 | 27.3 | 29.3 | 7.3% |
Balance Sheet
|
|---|
| Cash | 284.9 | 155.6 | 184.9 | 136.3 | 110.0 | -19.3% |
| Accounts Receivable | 168.4 | 157.4 | 127.1 | 129.9 | 126.6 | -2.5% |
| Inventory | 96.6 | 105.9 | 103.3 | 103.9 | 133.2 | 28.2% |
| Accounts Payable | 64.4 | 46.9 | 40.5 | 55.6 | 66.7 | 20.0% |
| Short Term Debt | 0.7 | 0.5 | 0.6 | 0.6 | 0.7 | 1.6% |
| Long Term Debt | 8.9 | 8.2 | 7.6 | 7.1 | 31.4 | 343.5% |
Cash flow
|
|---|
| Capex | 22.7 | 22.4 | 16.6 | 30.9 | 40.7 | 31.8% |
| Acquisitions | 345.4 | 91.8 | | 34.3 | | |
Ratios
|
|---|
| Revenue growth | 27.3% | 1.9% | -5.0% | 2.1% | 6.4% | |
| EBITDA growth | -26.8% | -785.7% | -104.0% | -63.5% | 99.6% | |
|
|---|
| Gross Margin | 48.6% | 43.8% | 48.9% | 47.2% | 47.2% | -0.0% |
| EBITDA Margin | 12.5% | -83.9% | 3.5% | 1.2% | 2.3% | 1.1% |
| EBIT Margin | 4.0% | -96.4% | -6.1% | -8.4% | -6.3% | 2.1% |
| SG&A, % of revenue | 33.0% | 45.6% | 41.0% | 40.9% | 39.6% | -1.3% |
| SBC, % of revenue | 5.0% | 5.2% | 4.9% | 4.2% | 4.3% | 0.0% |
| Net Income Margin | 1.8% | -98.4% | -6.1% | -10.2% | -6.6% | 3.6% |
| CAPEX, % of revenue | 3.5% | 3.4% | 2.6% | 4.8% | 5.9% | 1.1% |
|
|---|
| ROIC | 2.2% | -61.9% | -5.5% | -8.1% | -6.6% | 1.5% |
| ROE | 1.0% | -66.7% | -5.9% | -10.5% | -7.6% | 2.9% |
| Net Debt/EBITDA | -3.4x | | -8.0x | -15.9x | -4.8x | 11.1x |
| Interest expence / Average debt | 12.8% | 22.0% | 15.2% | 11.6% | 8.3% | -3.3% |
People
|
|---|
| Insider ownership | 3.8% | 3.8% | 3.8% | 3.8% | 3.8% | 0.0% |
| Employees | 2,136 | 2,492 | 2,445 | 2,666 | 2,620 | -1.7% |
| Revenue/Employee, th. $ | 306 | 267 | 259 | 242 | 262 | 8.3% |
3D Systems Corporation ($DDD) key quoterly financial indicators
| mln. $ | 18Q1 | 18Q2 | 18Q3 | 18Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 166 | 177 | 165 | 181 | | 6.0% | 10.7% | 7.6% | 1.9% |
| EBITDA | -2 | 7 | 4 | 7 | | -138.6% | -19.4% | | -28.5% |
| Net Income | -21 | -9 | -12 | -4 | | | | | |
Balance Sheet
|
|---|
| Cash | 122 | 119 | 92 | 110 | | -24.8% | -22.5% | -33.4% | -19.3% |
| Short Term Debt | 1 | 1 | 1 | 1 | | 13.2% | 5.4% | 3.0% | 1.6% |
| Long Term Debt | 7 | 7 | 7 | 31 | | -7.0% | -8.5% | -9.2% | 343.5% |
Ratios
|
|---|
| Gross Margin | 46.9% | 48.8% | 47.3% | 45.7% | | -4.3% | -1.8% | 9.0% | -2.5% |
| EBITDA Margin | -1.4% | 4.0% | 2.5% | 4.0% | | -5.1% | -1.5% | 13.4% | -1.7% |
| Net Income Margin | -12.6% | -5.0% | -7.0% | -2.3% | | -6.3% | 0.3% | 17.6% | 3.4% |
Peers in Technology Hardware, Storage &
Below we provide 3D Systems Corporation benchmarking against other companies in Technology Hardware, Storage & industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Crossroads Systems Inc ($CRSS) | | -90.6% | -35.5% | -89.5% | 39,959.5% |
| Immersion Corporation ($IMMR) | | 19.8% | -9.9% | -38.7% | 217.0% |
| Veritec Inc ($VRTC) | | -42.2% | -28.0% | -52.2% | 53.1% |
| Boxlight Corporation ($BOXL) | | -88.5% | 503.2% | 26.4% | 47.0% |
| Pure Storage, Inc. ($PSTG) | | 308.2% | 152.4% | 67.9% | 38.6% |
| |
|---|
| Median (30 companies) | -16.9% | -3.3% | -4.3% | 1.5% | 4.3% |
|---|
| 3D Systems Corporation ($DDD) | | 1.9% | -5.0% | 2.1% | 6.4% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Immersion Corporation ($IMMR) | 99.1% | 99.3% | 99.7% | 99.4% | 99.8% |
| Pure Storage, Inc. ($PSTG) | 43.5% | 55.5% | 61.9% | 65.9% | 65.5% |
| NetApp, Inc. ($NTAP) | 62.0% | 62.6% | 60.8% | 61.3% | 62.7% |
| Avid Technology, Inc. ($AVID) | 61.4% | 60.9% | 65.0% | 57.8% | 57.9% |
| Datasea Inc ($DTSS) | | | | 39.3% | 54.4% |
| |
|---|
| Median (29 companies) | 35.6% | 35.0% | 38.5% | 38.9% | 38.3% |
|---|
| 3D Systems Corporation ($DDD) | 48.6% | 43.8% | 48.9% | 47.2% | 47.2% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Immersion Corporation ($IMMR) | 12.3% | 9.0% | -25.1% | -127.0% | 48.6% |
| Apple Inc. ($AAPL) | 33.1% | 35.3% | 32.7% | 31.2% | 30.8% |
| Western Digital Corporation ($WDC) | 20.1% | 18.7% | 12.5% | 21.4% | 27.5% |
| NetApp, Inc. ($NTAP) | 16.9% | 16.7% | 11.3% | 15.4% | 22.9% |
| Seagate Technology PLC ($STX) | 19.3% | 21.1% | 11.3% | 16.7% | 20.0% |
| |
|---|
| Median (29 companies) | 7.1% | 7.4% | 4.9% | 4.5% | 7.9% |
|---|
| 3D Systems Corporation ($DDD) | 12.5% | -83.9% | 3.5% | 1.2% | 2.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Hewlett Packard Enterprise Company ($HPE) | 6.6% | 6.4% | 10.8% | 10.9% | 9.6% |
| Pure Storage, Inc. ($PSTG) | 28.7% | 24.2% | 8.9% | 10.4% | 6.3% |
| Apple Inc. ($AAPL) | 5.2% | 4.8% | 5.9% | 5.4% | 5.0% |
| Western Digital Corporation ($WDC) | 4.2% | 4.2% | 4.5% | 3.0% | 4.0% |
| Video Display Corp ($VIDE) | 0.5% | 0.5% | 0.9% | 1.5% | 3.9% |
| |
|---|
| Median (29 companies) | 2.6% | 2.9% | 1.7% | 1.8% | 2.2% |
|---|
| 3D Systems Corporation ($DDD) | 3.5% | 3.4% | 2.6% | 4.8% | 5.9% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Avid Technology, Inc. ($AVID) | | | | | 252.4% |
| Ionix Technology Inc ($IINX) | | | | 23.9% | 204.5% |
| Immersion Corporation ($IMMR) | 7.6% | 5.8% | -21.5% | -138.9% | 96.8% |
| HP Inc. ($HPQ) | 8.0% | 8.7% | 15.8% | 60.8% | 72.9% |
| NetApp, Inc. ($NTAP) | 12.5% | 14.8% | 7.3% | 14.0% | 28.1% |
| |
|---|
| Median (37 companies) | 6.0% | 5.7% | 1.8% | 1.6% | 3.6% |
|---|
| 3D Systems Corporation ($DDD) | 2.2% | -61.9% | -5.5% | -8.1% | -6.6% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| CPI Card Group Inc. ($PMTS) | 3.4x | 3.5x | 5.8x | | 12.4x |
| NCR Corporation ($NCR) | 4.9x | 6.6x | 2.7x | 2.3x | 5.2x |
| Avid Technology, Inc. ($AVID) | -0.7x | 3.1x | 1.7x | 5.6x | 4.8x |
| Xerox Corporation ($XRX) | 3.5x | 3.5x | 3.1x | 3.0x | 3.0x |
| Electronics for Imaging, Inc. ($EFII) | -0.2x | 1.4x | 1.3x | 1.6x | 1.7x |
| |
|---|
| Median (19 companies) | -0.2x | 0.5x | 0.4x | 0.5x | 1.1x |
|---|
| 3D Systems Corporation ($DDD) | -3.4x | | -8.0x | -15.9x | -4.8x |
