ExOne reports Q2 and H1 2019 financial results driven by machine revue

Additive manufacturing system OEM ExOne (NASDAQ: XONE) has announced financial results for the second quarter and first half of fiscal 2019. 

Consolidated revenue for the three months ended June 30, 2019 was reported at $15.3 million, an increase of 41 percent compared to the same period in 2018, which was $10.8 million. The total revenue for the six months ended June 30, 2019 was reported at $24.9 million, compared to $22.7 million in H1 2018, demonstrating a 9 percent increase. 

On the results, John Hartner, ExOne’s Chief Executive Officer, stated, “We are pleased with the significant progress we are making – from a technological, commercial and financial standpoint.”

The reported Q2 2019 revenue is a record level for a second quarter for ExOne. Machine revenue has been credited as the main driver behind the growth, accounting for 60 percent of the consolidated revenue total, compared to 30 percent in Q2 2018. Hartner added;

“We reached a milestone for ExOne this quarter, reporting record-setting second quarter revenue and gross profit levels, in spite of recent unfavorable macroeconomic factors.”

The S-Max Pro and X1 25PRO

Founded in 2005, ExOne has garnered over 10 years of experience in additive manufacturing. The company develops binder jet 3D printing systems for both metal and sand materials, intended for use in research and for end use production of parts and castings. ExOne also provides various sand and metal materials alongside its machine offerings, including qualified 316L stainless steel and silica sand. 

Hartner was appointed CEO of ExOne by the company’s Board of Directors in May 2019, taking over from S. Kent Rockwell, who retains the role of Chairman of the Board of Directors. Hartner initially joined the company as COO in November 2018. 

In June 2019, ExOne announced the launch of its new industrial 3D sand printer, the S-Max Pro, at the 2019 GIFA International Foundry Trade Fair in Dusseldorf, Germany. According to Hartner, the company has been receiving positive responses for the system, which comes equipped with Siemens’ Digital Factory portfolio of software and automation technology. The company also displayed its new X1 25PRO system at the RAPID + TCT trade show in Detroit in May, and has enlisted tooling companies Sandvik and Kennametal as beta testers. 

The ExOne S-Max Pro. Photo via ExOne.
The ExOne S-Max Pro. Photo via ExOne.

ExOne breaks record for Q2 revenue and gross profit

ExOne total revenue is divided into two product lines, comprising “3D Printing Machines,” and “3D Printed and Other Products, Materials and Services.” Of the consolidated revenue for Q2 2019, machine revenue contributed $9.3 million. By comparison, machine sales for Q2 2018 generated $3.2 million, constituting a year-on-year increase of 187 percent. The growth is representative of 13 machines sold in Q2 2019, compared with seven machines sold in Q2 2018.

3D Printed and Other Products, Materials and Services, a recurring revenue figure, was reported at $6.0 million in Q2 2019, compared with $7.6 million in the second quarter of 2018. The 21 percent decline was attributed to a lower volume of 3D printing projects at the company’s direct and indirect service centers. 

Revenues Q2 FY2019 Q2 FY2018 Variance $ millions %
3D Printing Machines 9,231 3,212 6,019 187.39%
3D Printed and Other Products, Materials and Services 6,048 7,644 -1,596 -20.88%
Consolidated total 15,279 10,857 4,422 40.73%

3D Printed and Other Products, Materials and Services revenue was down to $12.3 million for the first half of 2019, an 18 percent decrease from $15 million for the same period in 2018. 

For H1 2019, 3D Printing Machines revenue was reported at $12.6 million, a 62 percent increase from H1 2018 which was reported at $7.7 million. ExOne’s machine revenue in H1 2019 included the sales of 21 machine units, up from the 13 units sold in H1 2018. 

Revenues H1 FY2019 H1 FY2018 Variance $ millions %
3D Printing Machines 12,560 7,734 4,826 62.40%
3D Printed and Other Products, Materials and Services 12,298 15,016 -2,718 -18.10%
Consolidated total 24,858 22,750 2,108 9.27%

For the first half of 2019, ExOne’s gross profit was $7.8 million, with the cost of sales for the period amounting to $17 million. The gross profit figure is up 85 percent from 4.2 million for the same period in 2018. Gross margin expanded from 18.5 percent in H1 2018 to 31.3 percent in H1 2019.

ExOne also achieved a record level for gross profit in the 2019 second quarter for any Q2 period in the company’s history. Cost of sales for Q2 2019 came in at $10.1 million, giving the company a gross profit of $5.1 million, increasing by 223 percent from $1.6 million in the same period in 2018. In Q2 2019, ExOne’s gross margin expanded from 14.6 percent in Q2 2018 to 33.7 percent. 

The ExOne gross profit for Q2 and H1 2019 benefited from improved operating leverage, and also a reduction in fixed costs, which is a result of the 2018 global cost realignment program from the company. The program sought to reduce expenses in the day-to-day operations of ExOne, including all sites. 

Speaking on what is expected for ExOne in the rest of the fiscal 2019, Hartner concluded, “As variability of our quarterly revenue levels is typical, we currently believe that our third quarter revenue will be modestly higher than our second quarter and we are targeting a strong fourth quarter to close out the year.” 

“Importantly, we believe we have sufficient capital to execute our operating plans.”

ExOne’s full financial results for Q2 and H1 2019 are available here.

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Featured image shows the ExOne team at the 2019 GIFA International Foundry Trade Fair. Photo via ExOne.