Materialise NV 6-K, filed Jul 26, 2023
Materialise NV (MTLS)
About this 6-K
Materialise NV filed this 6-K on July 26, 2023.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of July 2023
Commission File Number: 001-36515
Materialise NV
Technologielaan 15
3001 Leuven
Belgium
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F x Form 40-F ¨
This Form 6-K is incorporated by reference into the registrant’s Registration Statement on Form F-3 (File No. 333-213649).
Second Quarter 2023 Financial Results
Except as otherwise required by the context, references to “Materialise,” “Company,” “we,” “us” and “our” are to Materialise NV and its subsidiaries.
Second Quarter 2023 Results
Total revenue for the second quarter of 2023 increased 11.6% to 64,810 kEUR from 58,070 kEUR for the second quarter of 2022.
Revenue from our Materialise Software segment increased 3.6% to 11,030 kEUR for the second quarter of 2023 from 10,642 kEUR for the same quarter last year.
Revenue from our Materialise Medical segment increased 19.6% to 24,945 kEUR for the second quarter of 2023 compared to 20,855 kEUR for the same period in 2022.
Revenue from our Materialise Manufacturing segment increased 8.5% to 28,835 kEUR for the second quarter of 2023 from 26,574 kEUR for the second quarter of 2022.
Gross profit was 37,047 kEUR for the second quarter of 2023 compared to 32,030 kEUR for the same period last year, while gross profit as a percentage of revenue increased to 57.2% compared to 55.2% for the second quarter of 2022.
Research and development (“R&D”), sales and marketing (“S&M”) and general and administrative (“G&A”) expenses decreased in the aggregate by 1.3% to 33,176 kEUR for the second quarter of 2023 from 33,613 kEUR for the second quarter of 2022, with disciplined cost containment in S&M and G&A fully offsetting the increased costs of our continued R&D efforts.
Net other operating income, which includes the negative impact from the adverse arbitration award, was (4,468) kEUR compared to 498 kEUR for the second quarter of 2022.
Operating result amounted to (597) kEUR compared to (1,084) kEUR for the second quarter of 2022.
Net financial result was 635 kEUR compared to 2,580 kEUR for the second quarter of 2022.
The second quarter of 2023 contained income tax expenses of (532) kEUR, compared to (600) kEUR in the second quarter of 2022.
As a result of the above, net result for the second quarter of 2023 was (494) kEUR, compared to 896 kEUR for the same period in 2022. Total comprehensive income for the second quarter of 2023, which includes exchange differences on translation of foreign operations, was 140 kEUR compared to 771 kEUR for the corresponding 2022 period.
At June 30, 2023, after payment of the 5,189 kEUR arbitration award, we had cash and cash equivalents of 136,285 kEUR compared to 140,867 kEUR at December 31, 2022. Gross debt amounted to 72,412 kEUR, compared to 80,980 kEUR at December 31, 2022. As a result, our net cash position (cash and cash equivalents less gross debt) was 63,873 kEUR, an increase of 3,986 kEUR compared to December 31, 2022
Cash flow from operating activities for the second quarter of the year 2023 was 775 kEUR compared to 8,636 kEUR for the same period in 2022. Total capital expenditures for the second quarter of 2023 amounted to 2,119 kEUR.
Net shareholders’ equity at June 30, 2023 was 233,393 kEUR compared to 228,928 kEUR at December 31, 2022.
Adjusted EBITDA amounted to 4,755 kEUR for the second quarter of 2023 compared to 4,240 kEUR for the corresponding 2022 period. The Adjusted EBITDA margin (Adjusted EBITDA divided by total revenue) for the second quarter of 2023 was 7.3%, equal to the second quarter of 2022. Excluding the (5,189) kEUR negative impact resulting from the unexpected adverse resolution of an arbitration proceeding, our Adjusted EBITDA margin for the quarter would have been 15.3%.
Adjusted EBITDA from our Materialise Software segment increased to 1,973 kEUR from 821 kEUR while the segment Adjusted EBITDA margin (segment Adjusted EBITDA divided by segment revenue) was 17.9% compared to 7.7% for the corresponding prior-year period.
Adjusted EBITDA from our Materialise Medical segment amounted to 2,683 kEUR for the second quarter of 2023 compared to 4,474 kEUR while the segment Adjusted EBITDA margin was 10.8% compared to 21.5% for the second quarter of 2022. Adjusted EBITDA from our Materialise Medical segment for the second quarter of 2023 includes the (5,189) kEUR negative effect from an arbitration award granted against us in our previously disclosed indemnification dispute with Zimmer Biomet related to certain joint replacement devices. Excluding the (5,189) kEUR negative impact, the Adjusted EBITDA from our Materialise Medical segment for the quarter would have been 31.6%.
Adjusted EBITDA from our Materialise Manufacturing segment amounted to 2,708 kEUR compared to 1,581 kEUR for the same period last year, while the segment Adjusted EBITDA margin was 9.4% compared to 5.9% for the second quarter of 2022.
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 1.0866, the reference rate of the European Central Bank on June 30, 2023.
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.
Consolidated income statements (Unaudited)
| for the three months ended June 30, | for the six months ended June 30, | |||||||||||||||||||
| In '000 | 2023 | 2023 | 2022 | 2023 | 2022 | |||||||||||||||
| U.S.$ | € | € | € | € | ||||||||||||||||
| Revenue | 70,423 | 64,810 | 58,070 | 130,702 | 111,032 | |||||||||||||||
| Cost of Sales | (30,168 | ) | (27,764 | ) | (26,040 | ) | (56,814 | ) | (50,118 | ) | ||||||||||
| Gross Profit | 40,255 | 37,047 | 32,030 | 73,888 | 60,914 | |||||||||||||||
| Gross profit as % of revenue | 57.2 | % | 57.2 | % | 55.2 | % | 56.5 | % | 54.9 | % | ||||||||||
| Research and development expenses | (10,311 | ) | (9,489 | ) | (8,955 | ) | (18,506 | ) | (16,770 | ) | ||||||||||
| Sales and marketing expenses | (15,385 | ) | (14,159 | ) | (14,954 | ) | (28,459 | ) | (28,469 | ) | ||||||||||
| General and administrative expenses | (10,353 | ) | (9,528 | ) | (9,704 | ) | (18,573 | ) | (18,148 | ) | ||||||||||
| Net other operating income (expenses) | (4,855 | ) | (4,468 | ) | 498 | (3,948 | ) | 1,436 | ||||||||||||
| Operating (loss) profit | (649 | ) | (597 | ) | (1,084 | ) | 4,402 | (1,036 | ) | |||||||||||
| Financial expenses | (728 | ) | (670 | ) | (1,320 | ) | (2,045 | ) | (2,561 | ) | ||||||||||
| Financial income | 1,419 | 1,305 | 3,901 | 2,114 | 5,517 | |||||||||||||||
| Share in loss of joint venture | - | - | - | - | - | |||||||||||||||
| (Loss) profit before taxes | 42 | 38 | 1,496 | 4,471 | 1,921 | |||||||||||||||
| Income Taxes | (578 | ) | (532 | ) | (600 | ) | (1,249 | ) | (898 | ) | ||||||||||
| Net (loss) profit for the period | (536 | ) | (494 | ) | 896 | 3,221 | 1,023 | |||||||||||||
| Net (loss) profit attributable to: | - | |||||||||||||||||||
| The owners of the parent | (530 | ) | (488 | ) | 903 | 3,234 | 1,036 | |||||||||||||
| Non-controlling interest | (7 | ) | (6 | ) | (7 | ) | (13 | ) | (13 | ) | ||||||||||
| Earning per share attributable to owners of the parent | ||||||||||||||||||||
| Basic | (0.01 | ) | (0.01 | ) | 0.02 | 0.05 | 0.02 | |||||||||||||
| Diluted | (0.01 | ) | (0.01 | ) | 0.02 | 0.05 | 0.02 | |||||||||||||
| Weighted average basic shares outstanding | 59,067 | 59,067 | 59,064 | 59,067 | 59,064 | |||||||||||||||
| Weighted average diluted shares outstanding | 59,067 | 59,067 | 59,095 | 59,070 | 59,100 | |||||||||||||||
Consolidated statements of comprehensive income (Unaudited)
| for the three months ended June 30, | for the six months ended June 30, | |||||||||||||||||||
| In 000€ | 2023 | 2023 | 2022 | 2023 | 2022 | |||||||||||||||
| U.S.$ | € | € | € | € | ||||||||||||||||
| Net profit (loss) for the period | (536 | ) | (494 | ) | 896 | 3,221 | 1,023 | |||||||||||||
| Other comprehensive income | ||||||||||||||||||||
| Recycling | ||||||||||||||||||||
| Exchange difference on translation of foreign operations | 689 | 634 | (125 | ) | 1,242 | 1,291 | ||||||||||||||
| Non-recycling | ||||||||||||||||||||
| Fair value adjustments through OCI - Equity instruments | - | - | - | - | - | |||||||||||||||
| Other comprehensive income (loss), net of taxes | 689 | 634 | (125 | ) | 1,242 | 1,291 | ||||||||||||||
| Total comprehensive income (loss) for the year, net of taxes | 152 | 140 | 771 | 4,463 | 2,314 | |||||||||||||||
| Total comprehensive income (loss) attributable to: | ||||||||||||||||||||
| The owners of the parent | 157 | 144 | 778 | 4,473 | 2,327 | |||||||||||||||
| Non-controlling interests | (4 | ) | (4 | ) | (7 | ) | (10 | ) | (13 | ) | ||||||||||
Consolidated statement of financial position (Unaudited)
| As of June 30, | As of December 31, | |||||||
| In 000€ | 2023 | 2022 | ||||||
| Assets | ||||||||
| Non-current assets | ||||||||
| Goodwill | 44,345 | 44,155 | ||||||
| Intangible assets | 35,780 | 37,875 | ||||||
| Property, plant & equipment | 94,599 | 94,276 | ||||||
| Right-of-Use assets | 8,277 | 8,420 | ||||||
| Investments in joint ventures | - | - | ||||||
| Deferred tax assets | 1,251 | 1,186 | ||||||
| Investments in convertible loans | 3,618 | 3,494 | ||||||
| Investments in non-listed equity instruments | 307 | 307 | ||||||
| Other non-current assets | 4,997 | 5,136 | ||||||
| Total non-current assets | 193,173 | 194,847 | ||||||
| Current assets | ||||||||
| Inventories | 16,007 | 16,081 | ||||||
| Trade receivables | 45,859 | 51,043 | ||||||
| Other current assets | 8,935 | 8,424 | ||||||
| Cash and cash equivalents | 136,285 | 140,867 | ||||||
| Total current assets | 207,085 | 216,414 | ||||||
| Total assets | 400,259 | 411,262 | ||||||
| As of June 30, | As of December 31, | |||||||
| In 000€ | 2023 | 2022 | ||||||
| Equity and liabilities | ||||||||
| Equity | ||||||||
| Share capital | 4,487 | 4,487 | ||||||
| Share premium | 233,895 | 233,895 | ||||||
| Retained earnings and other reserves | (4,951 | ) | (9,427 | ) | ||||
| Equity attributable to the owners of the parent | 233,431 | 228,955 | ||||||
| Non-controlling interest | (38 | ) | (28 | ) | ||||
| Total equity | 233,393 | 228,928 | ||||||
| Non-current liabilities | ||||||||
| Loans & borrowings | 49,823 | 55,873 | ||||||
| Lease liabilities | 5,123 | 5,147 | ||||||
| Deferred tax liabilities | 3,947 | 4,312 | ||||||
| Deferred income | 8,633 | 9,277 | ||||||
| Other non-current liabilities | 1,006 | 1,611 | ||||||
| Total non-current liabilities | 68,532 | 76,220 | ||||||
| Current liabilities | ||||||||
| Loans & borrowings | 14,631 | 17,058 | ||||||
| Lease liabilities | 2,835 | 2,902 | ||||||
| Trade payables | 22,790 | 23,230 | ||||||
| Tax payables | 2,129 | 1,246 | ||||||
| Deferred income | 40,579 | 41,721 | ||||||
| Other current liabilities | 15,370 | 19,957 | ||||||
| Total current liabilities | 98,334 | 106,114 | ||||||
| Total equity and liabilities | 400,259 | 411,262 | ||||||
Consolidated statement of cash flows (Unaudited)
| for the six months ended June 30, | ||||||||
| In 000€ | 2023 | 2022 | ||||||
| Operating activities | ||||||||
| Net (loss) profit for the period | 3,221 | 1,023 | ||||||
| Non-cash and operational adjustments | ||||||||
| Depreciation of property plant & equipment | 7,364 | 7,630 | ||||||
| Amortization of intangible assets | 3,334 | 3,186 | ||||||
| Impairment of goodwill and intangible assets | - | - | ||||||
| Share-based payment expense | - | (97 | ) | |||||
| Loss (gain) on disposal of intangible assets and property, plant & equipment | (106 | ) | 31 | |||||
| Movement in provisions | (591 | ) | 5 | |||||
| Movement reserve for bad debt and slow moving inventory | 272 | 136 | ||||||
| Financial income | (2,095 | ) | (5,509 | ) | ||||
| Financial expense | 2,055 | 2,564 | ||||||
| Impact of foreign currencies | (84 | ) | (61 | ) | ||||
| (Deferred) income taxes | 1,254 | 885 | ||||||
| Working capital adjustments | (3,336 | ) | 10,154 | |||||
| Decrease (increase) in trade receivables and other receivables | 4,269 | 1,450 | ||||||
| Decrease (increase) in inventories and contracts in progress | 81 | (2,839 | ) | |||||
| Increase (decrease) in deferred revenue | (1,772 | ) | 3,658 | |||||
| Increase (decrease) in trade payables and other payables | (5,914 | ) | 7,884 | |||||
| Income tax paid & Interest received | 531 | (201 | ) | |||||
| Net cash flow from operating activities | 11,819 | 19,747 | ||||||
| for the six months ended June 30, | ||||||||
| In 000€ | 2023 | 2022 | ||||||
| Investing activities | ||||||||
| Purchase of property, plant & equipment | (4,333 | ) | (7,494 | ) | ||||
| Purchase of intangible assets | (1,056 | ) | (2,553 | ) | ||||
| Proceeds from the sale of property, plant & equipment & intangible assets (net) | 218 | 184 | ||||||
| Acquisition of subsidiary (net of cash) | - | (25,610 | ) | |||||
| Net cash flow used in investing activities | (5,172 | ) | (35,473 | ) | ||||
| Financing activities | ||||||||
| Repayment of loans & borrowings | (8,617 | ) | (9,018 | ) | ||||
| Repayment of leases | (1,744 | ) | (1,668 | ) | ||||
| Capital increase | - | - | ||||||
| Interest paid | (891 | ) | (1,155 | ) | ||||
| Other financial income (expense) | (33 | ) | 604 | |||||
| Net cash flow from (used in) financing activities | (11,285 | ) | (11,236 | ) | ||||
| Net increase/(decrease) of cash & cash equivalents | (4,638 | ) | (26,964 | ) | ||||
| Cash & Cash equivalents at the beginning of the year | 140,867 | 196,028 | ||||||
| Exchange rate differences on cash & cash equivalents | 57 | (930 | ) | |||||
| Cash & cash equivalents at end of the period | 136,285 | 168,133 | ||||||
Reconciliation of Net Profit (Loss) to EBITDA and Adjusted EBITDA (Unaudited)
| for the three months ended June 30, | for the six months ended June 30, | |||||||||||||||
| In 000€ | 2023 | 2022 | 2023 | 2022 | ||||||||||||
| Net profit (loss) for the period | (494 | ) | 896 | 3,221 | 1,023 | |||||||||||
| Income taxes | 532 | 600 | 1,249 | 898 | ||||||||||||
| Financial expenses | 670 | 1,320 | 2,045 | 2,561 | ||||||||||||
| Financial income | (1,305 | ) | (3,901 | ) | (2,114 | ) | (5,517 | ) | ||||||||
| Depreciation and amortization | 5,353 | 5,374 | 10,664 | 10,816 | ||||||||||||
| EBITDA | 4,755 | 4,289 | 15,066 | 9,780 | ||||||||||||
| Share-based compensation expense (1) | - | (49 | ) | - | (97 | ) | ||||||||||
| Adjusted EBITDA | 4,755 | 4,240 | 15,066 | 9,683 | ||||||||||||
(1) Share-based compensation expense represents the cost of equity-settled and share-based payments to employees.
Segment P&L (Unaudited)
| In 000€ | Materialise Software | Materialise Medical | Materialise Manufacturing | Total segments | Unallocated (1) | Consolidated | ||||||||||||||||||
| For the three months ended June 30, 2023 | ||||||||||||||||||||||||
| Revenues | 11,030 | 24,945 | 28,835 | 64,810 | 0 | 64,810 | ||||||||||||||||||
| Segment (adj) EBITDA | 1,973 | 2,683 | 2,708 | 7,364 | (2,608 | ) | 4,755 | |||||||||||||||||
| Segment (adj) EBITDA % | 17.9% | 10.8% | 9.4% | 11.4% | 7.3% | |||||||||||||||||||
| For the three months ended June 30, 2022 | ||||||||||||||||||||||||
| Revenues | 10,642 | 20,855 | 26,574 | 58,070 | 0 | 58,070 | ||||||||||||||||||
| Segment (adj) EBITDA | 821 | 4,474 | 1,581 | 6,876 | (2,636 | ) | 4,240 | |||||||||||||||||
| Segment (adj) EBITDA % | 7.7% | 21.5% | 5.9% | 11.8% | 7.3% | |||||||||||||||||||
| In 000€ | Materialise Software | Materialise Medical | Materialise Manufacturing | Total segments | Unallocated (1) | Consolidated | ||||||||||||||||||
| For the six months ended June 30, 2023 | ||||||||||||||||||||||||
| Revenues | 22,381 | 49,265 | 59,056 | 130,702 | 0 | 130,702 | ||||||||||||||||||
| Segment (adj) EBITDA | 4,409 | 10,035 | 5,906 | 20,350 | (5,285 | ) | 15,066 | |||||||||||||||||
| Segment (adj) EBITDA % | 19.7% | 20.4% | 10.0% | 15.6% | 11.5% | |||||||||||||||||||
| For the six months ended June 30, 2022 | ||||||||||||||||||||||||
| Revenues | 21,125 | 39,201 | 50,705 | 111,032 | 0 | 111,032 | ||||||||||||||||||
| Segment (adj) EBITDA | 2,753 | 7,701 | 4,192 | 14,647 | (4,963 | ) | 9,683 | |||||||||||||||||
| Segment (adj) EBITDA % | 13.0% | 19.6% | 8.3% | 13.2% | 8.7% | |||||||||||||||||||
(1) Unallocated segment adjusted EBITDA consists of corporate research and development 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 June 30, | for the six months ended June 30, | |||||||||||||||
| In 000€ | 2023 | 2022 | 2023 | 2022 | ||||||||||||
| Net profit (loss) for the period | (494 | ) | 896 | 3,221 | 1,023 | |||||||||||
| Income taxes | 532 | 600 | 1,249 | 898 | ||||||||||||
| Financial cost | 670 | 1,320 | 2,045 | 2,561 | ||||||||||||
| Financial income | (1,305 | ) | (3,901 | ) | (2,114 | ) | (5,517 | ) | ||||||||
| Operating (loss) profit | (597 | ) | (1,084 | ) | 4,402 | (1,036 | ) | |||||||||
| Depreciation and amortization | 5,353 | 5,374 | 10,664 | 10,816 | ||||||||||||
| Corporate research and development | 737 | 816 | 1,459 | 1,465 | ||||||||||||
| Corporate headquarter costs | 2,576 | 2,104 | 5,238 | 4,612 | ||||||||||||
| Other operating income (expense) | (705 | ) | (640 | ) | (1,412 | ) | (1,211 | ) | ||||||||
| Segment adjusted EBITDA | 7,364 | 6,568 | 20,350 | 14,647 | ||||||||||||
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| MATERIALISE NV | ||
| By: |
/s/ Wilfried Vancraen | |
| Name: | Wilfried Vancraen | |
| Title: | Chief Executive Officer | |
Date: July 26, 2023