Materialise eclipses pre-COVID-19 revenue levels for the first time

Belgian software and 3D printing service provider Materialise (MTLS) has revealed that it generated more revenue in Q2 2021 than it managed to bring in during the pre-pandemic period of Q2 2019. 

Within its Q2 2021 financials, the company reported an income of €51 million, 33% more than the €38 million it generated in Q2 2020, and a 6% rise on the €48 million it earned in Q2 2019. The result marks the first time Materialise has outperformed the figures it published immediately prior to the outbreak of COVID-19, and a rapid turnaround for the firm, after it reported flat Q1 2021 growth earlier this year. 

The company’s revival has largely been driven by a 50% jump in its Medical income between Q2 2020 and Q2 2021, while its manufacturing division also recovered to achieve 39% growth over the same period. Since the results’ publication, shares in Materialise have risen 5%, reflecting investor satisfaction at its quarterly rebound.

“Our strong second quarter results reflect our swift recovery from the COVID-19 crisis: on a sequential basis, our revenues grew by 11.3% compared to the first quarter of 2021,” explained Peter Leys, Executive Chairman of Materialise. “More importantly, in addition to a solid recovery, our Q2 2021 results also show effective growth relative to our pre-pandemic results.” 

Materialise 3D printing lab. Photo via Materialise.
Materialise’s Medical division generated 29% more revenue in Q2 2021 than it did during Q2 2019. Photo via Materialise.

Materialise’s Q2 2021 financials 

Materialise reports its revenue across three main segments: Software, Medical, and Manufacturing, with the latter traditionally being its highest earner. Manufacturing had been the firm’s slowest growing division in Q1 2021, but it managed to recover to bring in €23 million during Q2 2021, representing a sequential quarterly increase of 5%, and just €1 million short of what it managed to generate in Q2 2019. 

Likewise, the company’s Medical income soared during Q2 2021, rising to €18 million from the €12 million reported back in Q2 2020. Impressively, this figure also constitutes a 29% increase on the €14 million the segment was able to bring in during Q2 2019, and its EBITDA rose in tandem by 8% between Q2 2020 and Q2 2021. 

With regards to its Software business, Materialise’s revenue growth was slightly less pronounced during the quarter, rising by 5% from the €9.5 million generated in Q2 2020 to €10 million, although this still represents an increase on the €9.3 million reported in Q2 2019, and reflects the steady progress it has made in the last 2 years. 

Materialise Revenue (€)Q2 2020Q2 2021Difference (%) Q2 2019Q2 2021Difference (%) 
Software 9.5m10m+59.3m10m+8
Medical 12m18m+5014m18m +29
Manufacturing 17m23m+3924m23m-4

Charting a prosperous Q2 

Speaking on Materialise’s earnings call, the firm’s CEO Fried Vancraen suggested that its recent revenue growth has come in part from its Magics and Mimics platforms. Given that Mimics is regularly applied in hospital settings, he said that the program “contributed significantly” to the income generated by its wider Medical division during Q2 2021. 

In order to ensure the continued growth of its medical software sales, Vancrean said the company is therefore planning to ramp up its development of both AR and VR features for its Mimics Suite, while he anticipates that its upcoming acquisition of Link3D will help accelerate its plans to make Magics cloud-accessible, and ultimately more appealing to clients. 

On the manufacturing front, Materialise also made significant progress during Q2, becoming the first to SLS 3D print flight-ready parts for aerospace firm Airbus. Having been qualified to produce flame-resistant aircraft components, the firm stated at the time that the move could “open up 3D printing applications,” potentially making the firms’ partnership more lucrative for Materialise in the future. 

Elsewhere, the company has generated €110 million via a registered public offering of four million American Depository Shares (ADSs). The funding raised has helped cover the costs of Materialise’s new 3,500 sq. foot 3D printing facility which opened earlier this year, and it could now fund its continued expansion after it acquired Engimplan, RS Print, and invested in eyewear firm Ditto over the last 48 months. 

A Materialise 3D printing facility equipped with EOS systems. Photo via Materialise.
Materialise doesn’t see Manufacturing recovering at the same pace as its Medical or Software divisions due to COVID-related disruption. Photo via Materialise.

Targeting pre-COVID income levels 

In the process of wrapping up Materialise’s earnings call, Leys said that if things “continue in the right direction” over the next few months, he expects the firm’s FY 2021 revenue to exceed the €197 million reported in FY 2019, and eventually fall somewhere around the €200 million mark, while achieving annual growth of 15-17% compared to Q2 2020. 

Interestingly, Leys added that during the six months ahead, he anticipates that the company’s manufacturing division won’t recover at the same pace as the rest of its business due to ongoing instability in the automotive sector, while Q3 is traditionally seen as a quiet quarter for the company, thus he doesn’t see its rapid growth continuing into the next period. 

“Q4 is just not traditionally our strongest quarter, but in terms of continuous sequential growth and further recovery, we see that more happening also in Q4 than in Q3,” concluded Leys. “So we do expect to meet the €200 million mark that we have set as an ambition, but that will mainly come from the fourth quarter, which basically means that you should not expect much growth from Q2 to Q3.” 

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Featured image shows a Materialise 3D printing lab. Photo via Materialise.