Velo3D

3D Printing Financials: Voxeljet Revenue up 80% since Last Earnings Report, Losses Deepen Year-over-Year

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Industrial 3D printer manufacturer voxeljet (Nasdaq: VJET) reported fourth-quarter net losses for 2020 of €3.7 million ($4.3 million) after posting similar losses in the same period a year earlier. The German company said total revenues for the quarter decreased 7.2% to €8,9 million ($10.4 million) from €9,6 million ($11.2 million) in the last quarter of 2019. The decline in revenue is mainly related to the lower number of printer sales as a response to the COVID-19 pandemic’s impact on the market demand, particularly on the company’s services segment, which was offset by significant revenue downfall in North American markets, reflecting an unavoidable slow-down of the economy.

Nonetheless, after a weak start to 2020 and a heavy blow in the second quarter, voxeljet witnessed a considerable market recovery starting in the latter half of the year onwards, including catch-up effects in the fourth quarter of 2020 for the German service center, which management hopes will trickle down to the 2021 fiscal year. The earnings report released on March 30, 2021, also reflected a sequential increase of 80% in revenues, going from €4.9 million ($5.7 million) in Q3 to €8.9 million ($10.4 million).

You can peek inside a VX1000 PDB system that works with a phenolic resin to bond the sand layers and create strong and filigree molds and cores for metal casting. Image courtesy of voxeljet.

Last year’s fourth-quarter losses brought the company’s accumulated deficit to €75.5 million ($88.4 million), representing a 26% increase from the previous year’s number, and has moved total equity and liabilities down 15% – a detail which stockholders may not take very well. For the period, research and development expenses also decreased to €1,7 million ($2 million), mainly due to lower labor costs related to a reduced number of employees supporting various existing and future projects as well as a decrease in external services.

On the upside, the total gross profit margin for the fourth quarter increased from 30.1% to 33.6%. This was mainly due to the significant improvement of gross profit and gross profit margin contributions from the German operation, in line with the increase in revenues resulting in higher utilization of the service center for on-demand production. Instead, revenue contribution from the service center in China slightly declined due to a subdued economy, and there was no further revenue contribution from voxeljet’s subsidiary in the UK, as the service center remains closed since the fourth quarter of 2019 due to restructuring. These negative impacts from the subsidiaries were almost completely offset by the German operation, where the company recorded a significant increase in revenues for the year’s fourth quarter.

3D printed phenolic sand cores for foundries. Image courtesy of voxeljet.

For the year ended December 31, 2020, the 3D printing company posted revenues of €21.6 million ($25.3 million), a 12.3% decrease from the €24.6 million ($28.8 million) the year before. voxeljet share price more than doubled in February 2021 from its fluctuating price range between $3.85 and $11.92 during 2020. Even reaching some of its highest values in three years. Moreover, the company’s move from the New York Stock Exchange (NYSE) – where it had been trading since its IPO in 2013 – to the NASDAQ has led its stock price on a steady growth path. Starting from an $8.29 value at the time of transfer on August 31, 2020, to $15 on March 30, 2021, at the time when the full year 2020 report was released.

Chief Executive Officer Ingo Ederer acknowledged that 2020 was a transformational year for the business and emphasized that voxeljet is different from other players in the 3D printing industry due to its focus on additive manufacturing (AM) solutions for industrial mass production. He estimates that with the current portfolio, the share in sales to manufacturing is “already higher than any of our competitors” and expects this to grow significantly with sales from its VJET X 3D printer for serial production of complex sand cores. That, along with the upcoming VX1000 high-speed sintering (HSS) high-performance polymer 3D printing platform.

voxeljet’s VJET X 3D printer. Image courtesy of voxeljet.

Even though the critical and unexpected COVID-19 crisis led manufacturing firms worldwide to reevaluate their production strategies and consider a shift towards advanced manufacturing technologies like AM, pandemic-related lockdowns, remote working, and even cash constraints placed a halt on industry 4.0 projects. For voxeljet, this meant lower 3D printer sales. Impacted by the COVID-19 situation, the company sold eight new and five used and refurbished 3D printers during 2020, compared to thirteen new and six used and refurbished 3D printers the year before.

Other systems revenues include related consumables, spare parts, and maintenance, which were also hit hard last year as service visits were limited in many regions of the world, making it impossible to fulfill any type of maintenance schedule. With clients reducing their production activities, there was even lower demand for consumables and spare parts. Eventually, in the third quarter of 2020, demand substantially recovered compared to the prior two quarters, and the positive trend continued into the fourth quarter. Amid a recovering market, voxeljet is more optimistic about 2021, looking forward to revenues at pre-pandemic levels, closer or above 2019’s €24.6 million ($28.8 million) mark.

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