3D Systems Announces Q1 Results

From: ChathamRes@aol.com
Date: Thu Apr 18 2002 - 14:48:30 EEST

Vantico Settlement Contributes $0.82 to EPS
VALENCIA, Calif.--(BUSINESS WIRE)--April 17, 2002--3D Systems Corp. (Nasdaq:
TDSC - news) today announced revenues for the first quarter 2002 of $27.2
million and net income of $8.5 million or $0.58 per fully diluted share. This
compares with the first quarter 2001 revenue of $27.9 million and EPS of
$0.11 per fully diluted share for 3D Systems, prior to the acquisition of DTM
Compared with the combined results of 3D Systems and DTM Corporation in the
first quarter of 2001, totaling $37.5 million, revenue decreased by 28% in
the first quarter of 2002.
Included in the first quarter earnings is a pretax benefit associated with
the Vantico arbitration settlement of $18.5 million or $0.82 per share after
taxes. Without the benefit associated with the Vantico arbitration, a net
loss of $3.5 million or $0.27 per fully diluted share would have been
realized. The company continued to strengthen its working capital position
and reduced total senior bank debt to $19 million from $21 million at Dec.
31, 2001.
The revenue and earnings shortfall results primarily from lower European
revenues and continued slowness in the U.S. manufacturing sector across all
product lines.
"We are not pleased with first quarter results," stated Brian K. Service,
president and chief executive officer. "We are in the process of
recalibrating our cost structure in line with current market conditions
including a reduction of approximately 10% of our work force on a worldwide
"The total number of SLA® 7000 systems shipped in Q1 increased over Q4 2001,
although total unit shipments across most other SLA and SLS® systems
categories were lower than anticipated," continued Service. "The reduction in
our gross margins to 37.3% overall compared with 46.1% in Q1 2001 (3D Systems
and DTM on a combined basis) and 42.9% in Q4 2001 is a result of the lower
overall system sales.
"During the first quarter, we made progress on several fronts, especially
relating to our Advanced Digital Manufacturing strategic program. And we are
very pleased with the Vantico settlement which resolved one of the major
challenges surrounding our business," Service said.
"We are now refocusing the management resources consumed by the arbitration
toward our resin conversion program and our overall materials business. This
includes our new Accura(TM) materials line, which will be announced at the
beginning of next week. We also expect to finalize details of the license
divestiture, as required under the DOJ Consent Decree, during the second
quarter," Service concluded.
As previously announced, 3D Systems will hold a conference call today to
discuss the first quarter results at 9:30 a.m. Eastern Daylight Time (6:30
a.m. Pacific Daylight Time). To access the call, dial 877/613-8341 or
706/679-7620 internationally. A recording of the call will be available for
72 hours beginning one hour after the call ends. To access the recording,
dial 800/642-1687 or 706/645-9291 internationally and enter 3756743.
About 3D Systems
Founded in 1986, 3D Systems provides solid imaging products and solutions
that help reduce the time and cost of designing products and facilitate
direct and indirect manufacturing. Its systems utilize patented technologies
that create physical objects from digital input.
3D Systems currently offers the ThermoJet® solid object printer, SLA®
(stereolithography) systems and SLS® (selective laser sintering) systems, as
well as related software and materials. Product pricing in the U.S. ranges
from $49,995, for the ThermoJet printer, to $799,000 for the high-end SLA
7000 system.

Chatham Research

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