Best Quarter in Nano Dimension's History
Continued Improvement in Financial Strength and Transformational M&A Transaction
Quarterly Revenue Sets Record at $15.0 MillionUp 2% from Q2/2023
Gross Margin Improvement of 136 bps45.4% in Q2/2024, Up From 44.1% in Q2/2023
Adjusted Gross Margin Improvement of 75 bps48.1% in H1/2024, Up From 47.3% in H1/2023
Company Reduces Net Cash Burn by 69%$18M in H1/2024, Down From $58M in H1/2023
Definitive Agreement Announced to Acquire Desktop Metal Following Quarter EndCreating a Leader in Additive Manufacturing
Conference Call to be Held Today at 9:00 a.m. EDT
WALTHAM, Mass., Aug. 20, 2024 (GLOBE NEWSWIRE) -- Nano Dimension Ltd. (NASDAQ:NNDM, "Nano Dimension" or the "Company")), an industry leader in Additively Manufactured Electronics, additive PCB assembly & printhead drivers and software (AME), and a supplier of Additive Manufacturing machines and materials (AM), today announced financial results for the second quarter ended June 30th, 2024 and shared a letter from the Company's Chief Executive Officer.
Revenue:
For Q2/2024 was $15.0 million, compared to Q2/2023's $14.7 million.
For H1/2024 was $28.4 million, compared to H1/2023's $29.7 million.
Gross Margin ("GM"):
For Q2/2024 was 45.4%, compared to Q2/2023's 44.1%.
For H1/2024 was 45.8%, compared to H1/2023's 44.0%.
Adjusted Gross Margin ("Adjusted GM"):
For Q2/2024 was 46.6%, compared to Q2/2023's 47.5%.
For H1/2024 was 48.1%, compared to H1/2023's 47.3%.
Net Income / Loss:
For Q2/2024 was a loss of $44.3 million, compared to Q2/2023's loss of $9.4 million.
For H1/2024 was a loss of $79.2 million, compared to H1/2023's income of $12.6 million.
Net Income / Loss excluding changes in Company's holdings in Stratasys' shares:
For Q2/2024 was a loss of $12.9 million, compared to Q2/2023's loss of $21.3 million.
For H1/2024 was a loss of $22.1 million, compared to H1/2023's loss of $44.6 million.
Adjusted EBITDA:
For Q2/2024 was negative $16.1 million, compared to Q2/2023's negative $23.5 million.
For H1/2024 was negative $29.7 million, compared to H1/2023's negative $47.2 million.
Company improves Net cash burn1 by further reduction of expenses :
For Q2/2024 was negative $11 million, compared to Q2/2023's negative $31 million.
For H1/2024 was negative $18 million, compared to H1/2023's negative $58 million.
Details regarding Adjusted GM, Net Income / Loss excluding changes in Company's holdings on Stratasys' shares, Adjusted EBITDA and Net Cash Burn can be found below in this press release under "non-IFRS measures."
____________________1 Change in cash, cash equivalents and deposits net of treasury shares repurchase.
CEO MESSAGE TO SHAREHOLDERS:
Dear Shareholders,
Exciting times are ahead, as your company continues to improve from the top to the bottom line. Additionally, a transformational M&A definitive agreement is expected to change our scale, makeup and merits of the business model, exponentially.
On our business as it is today
The first point to highlight is this year's quarterly revenue of $15.0 million. This is a record, especially in the context of alleged macroeconomic headwinds and high interest rates that seemingly all companies in our industry attest to as being meaningfully challenging. Our exposure to markets indicates "headwinds" mostly in central Europe, at this point.
But we are not only resting on our laurels. We see continued improvements in our financial strength as we move below the top-line and into our cash flow. This has been the focus of our leadership team since we announced our Reshaping Nano Initiative in Q3/2023. Our efforts are bearing fruit. In comparing our H1 figures for 2024 vs. 2023, we see a 183 bps improvement in gross margin and a $40 million reduction in net cash burn. The latter is a monumental change and a reflection of the hard work of our team to realize synergies and organizational efficiencies.
It is also important to call out that our improved financial strength has not come at the expense of innovation. In Q2/2024, we saw our industrial AI group, DeepCube, along with our respective materials and software teams, all work on new developments that will advance the impact of our products and services for our customers. Our Additive Electronics team implemented a new Integrated Inspection System (I2S), which brings together pick-and-place functionality with inline inspection. The team at Global Inkjet Systems Ltd. ("GIS") also announced a new partnership with Esko-Graphics BV and Fiery, LLC that combines the partners' respective workflow automation, prepress, color management, and job management solutions with GIS's advanced print control systems, creating a streamlined process for Industry 4.0 smart printing.
Outlook, moving forward:
There is more to do. While our employees should be proud of what they have achieved, management should not rest. The future of Nano Dimension will undoubtedly be shaped by the eventual closing of our agreement to acquire Desktop Metal, Inc. ("DM"), which we worked on initially since late 2022, again in late 2023, and announced on July 3rd, 2024. This acquisition will create a leader in AM.
The combined company will bring together outstanding teams and one of the most advanced portfolios in AM for mass production. I also believe this combination is compelling as the products and services portfolio can be characterized as having long term high growth potential. Together, we will accelerate our industry's transition to integrated digital manufacturing solutions.
Now that the deal is signed, the team is committed to preparing for realizing synergies to the greatest extent possible and as soon as possible. To do this, we are working on a post-merger integration plan to ensure a seamless transition from day one after closing of the transaction.
I believe this acquisition was secured at an exceptionally compelling valuation for our shareholders with the total consideration being at most $183 million, and, with some potential adjustments, as low as $135 million. This creates a pro forma company that, based on the last full year figures from 2023, had revenue of $246 million with 28% of that generated from recurring revenue associated with consumables and services.
Having said that, we intend, if needed, to forgo inflating the top line, for the benefit, if possible, of improved EBITDA and reduction of negative cash flow while driving toward cash generation and positive profits.
In closing, with our recent and continued financial advancements along with a definitive agreement to acquire DM, our team is "laser focused" on generating returns and expanding value for our shareholders. We will continue to pursue operational excellence and a M&A strategy that complements our offerings, supporting our journey to becoming leaders in digital manufacturing.
Thank you,
Yoav SternChief Executive Officer and a member of the Board of Directors Nano Dimension
FINANCIAL RESULTS:
Financial results for the second quarter ended June 30, 2024
Total revenues for the second quarter of 2024 were $14,986,000, compared to $14,737,000 in the second quarter of 2023. The increase is attributed to increased sales of the Company's product lines.
Total cost of revenues for the second quarter of 2024 was $8,178,000, compared to $8,242,000 in the second quarter of 2023.
As a result of the reorganizational plan executed by the Company in the fourth quarter of 2023 and other cost reduction efforts taken in 2024, the Company's operating expenses across all departments have decreased in the second quarter of 2024 compared to the second quarter of 2023.
Research and development ("R&D") expenses for the second quarter of 2024 were $9,121,000, compared to $16,386,000 in the second quarter of 2023. The decrease is mainly attributed to a decrease in payroll and related expenses, as well as in share-based compensation expenses, materials for R&D use, subcontractors and professional services, largely associated with organizational synergies.
Sales and marketing expenses for the second quarter of 2024 were $7,221,000, compared to $8,217,000 in the second quarter of 2023. The decrease is mainly attributed to a decrease in payroll and related expenses, largely associated with organizational synergies.
General and administrative expenses for the second quarter of 2024 were $8,581,000, compared to $12,322,000 in the second quarter of 2023. The decrease is mainly attributed to a decrease in professional services, largely associated with organizational synergies.
Other expenses, net for the second quarter of 2024 were $2,721,000. The forementioned expenses were related to DM transaction costs.
Net loss attributable to owners of the Company for the second quarter of 2024 was $43,971,000, or $0.20 loss per share, compared to net loss attributable to owners of the Company of $9,119,000, or $0.04 per share, in the second quarter of 2023. The increase is mainly attributed to the re-valuation of the Company's investment in securities.
Financial results for the six months ended June 30, 2024
Total revenues for the six months period ended June 30, 2024, were $28,350,000, compared to $29,702,000 in the six months period ended June 30, 2023. The decrease is attributed to decreased sales of the Company's product lines in the first quarter of 2024.
Total cost of revenues for the six months period ended June 30, 2024, was $15,364,000, compared to $16,641,000 in the six months period ended June 30, 2023. The decrease is attributed mostly to decreased sales of the Company's product lines.
As a result of the reorganization plan executed by the Company in the fourth quarter of 2023 and other cost reduction efforts taken in 2024, the Company's operating expenses across all departments have decreased in the first half of 2024 compared to the first half of 2023.
R&D expenses for the six months period ended June 30, 2024, were $18,254,000, compared to $35,636,000 in the six months period ended June 30, 2023. The decrease is attributed mostly to a decrease in payroll and related expenses, as well as in share-based compensation expenses, materials for R&D use, subcontractors and professional services, largely associated with organizational synergies.
Sales and marketing expenses for the six months period ended June 30, 2024, were $13,738,000, compared to $15,703,000 in the six months period ended June 30, 2023. The decrease is mainly attributed to a decrease in payroll and related expenses, as well as in share-based compensation expenses, largely associated with organizational synergies.
General and administrative expenses for the six months period ended June 30, 2024, were $18,183,000, compared to $23,355,000 in the six months period ended June 30, 2023. The decrease is mainly attributed to a decrease in professional services expenses, largely associated with organizational synergies.
Other expenses for the six months period ended June 30, 2024, were $2,612,000. The forementioned expenses mainly related to DM transaction costs.
Net loss attributable to owners of the Company for the for the six months period ended June 30, 2024, was $78,743,000, or $0.35 loss per share, compared to net income attributable to owners of the Company of $13,103,000, or $0.05 per share, in the six months period ended June 30, 2023, with gains mainly attributed to the re-valuation of the Company's investment in securities.
Conference call information The Company will host a conference call to discuss these financial results today, August 20th, 2024, at 9:00 a.m. EDT (4:00 p.m. IDT), which can be accessed per the details below. For webcast link: https://event.choruscall.com/mediaframe/webcast.html?webcastid=YLm29wAAFor phone:U.S. Dial-in Number (Toll Free): 1-844-695-5517International Dial-in Number: 1-412-902-6751Israel Dial-in Number (Toll Free): 1-80-9212373
Please request the "Nano Dimension NNDM call" when prompted by the conference call operator. For those unable to participate in the conference call, there will be a replay available from a link on Nano Dimension's website at http://investors.nano-di.com/events-and-presentations.
About Nano Dimension
Nano Dimension's (NASDAQ:NNDM) vision is to transform existing electronics and mechanical manufacturing into Industry 4.0 environmentally friendly & economically efficient precision additive electronics and manufacturing – by delivering solutions that convert digital designs to electronic or mechanical devices - on demand, anytime, anywhere.
Nano Dimension's strategy is driven by the application of deep learning based AI to drive improvements in manufacturing capabilities by using self-learning & self-improving systems, along with the management of a distributed manufacturing network via the cloud.
Nano Dimension has served over 2,000 customers across vertical target markets such as aerospace and defense, advanced automotive, high-tech industrial, specialty medical technology, R&D and academia. The Company designs and makes Additive Electronics and Additive Manufacturing 3D printing machines and consumable materials. Additive Electronics are manufacturing machines that enable the design and development of High-Performance-Electronic-Devices (Hi-PED®s). Additive Manufacturing includes manufacturing solutions for production of metal, ceramic, and specialty polymers-based applications - from millimeters to several centimeters in size with micron precision.
Through the integration of its portfolio of products, Nano Dimension is offering the advantages of rapid prototyping, high-mix-low-volume production, IP security, minimal environmental footprint, and design-for-manufacturing capabilities, which is all unleashed with the limitless possibilities of additive manufacturing.
For more information, please visit www.nano-di.com.
Forward-Looking Statements and Other Disclaimers
This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 and other Federal securities laws. Words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," and similar expressions or variations of such words are intended to identify forward-looking statements. Specifically this press release includes statements regarding: (i) transformational M&A definitive agreement that is expected to change Nano Dimension's scale, makeup and merits of business, exponentially, (ii) this acquisition will create a leader in AM, (iii) the combined company will bring together outstanding teams and one of the most advanced portfolios in AM for mass production, (iv) Nano Dimension's belief that this combination is so compelling as it combines a company with one of the broadest portfolios of products and services in DM with another company with products and services with the highest growth potential, (v) together, the companies will accelerate their industry's transition to digital manufacturing solutions at a substantial growth rate, (vi) the final merger consideration, which is subject to certain adjustments and the expectations regarding those adjustments, and the timing of closing, (vii) that, post-closing, Nano Dimension intends to forgo for a few quarters, if needed, inflating the top line, for the benefit, if possible, of improved EBITDA and reduction of negative cash flow while driving toward cash generation and positive profits, (viii) advancing the impact of Nano Dimension's products and services, (ix) Nano Dimension's M&A strategy, and (x) that Nano Dimension will continue to pursue operational excellence and an M&A strategy that complements its offerings, supporting its journey to becoming leaders in digital manufacturing. Because such statements deal with future events and are based on Nano Dimension's and DM's current expectations, they are subject to various risks and uncertainties. The acquisition is subject to closing conditions, some of which are beyond the control of Nano Dimension or DM. Actual results, performance, or achievements of Nano Dimension or DM could differ materially from those described in or implied by the statements in this press release. The forward-looking statements contained or implied in this press release are subject to other risks and uncertainties, including (i) the ultimate outcome of the proposed transaction between Nano and DM, including the possibility that DM's stockholders will reject the proposed transaction, (ii) the effect of the announcement of the proposed transaction on the ability of Nano Dimension and DM to operate their businesses and retain and hire key personnel and to maintain favorable business relationships (iii) the timing of the proposed transaction, (iv) the occurrence of any event, change or other circumstance that could give rise to the termination of the proposed transaction; (v) the ability to satisfy closing conditions to the completion of the proposed transaction (including any necessary shareholder approvals), (vi) the Company's transaction expenses are greater than expected; (vii) the Company draws on the loan facility provided by Nano Dimension, (vii) other risks related to the completion of the proposed transaction and actions related thereto, and (viii) the risks and uncertainties discussed under the heading "Risk Factors" in Nano Dimension's annual report on Form 20-F filed with the SEC on March 21, 2024, and in any subsequent filings with the SEC, and under the heading "Risk Factors" in DM's annual report on Form 10-K filed with the SEC on March 15, 2024, and in any subsequent filings with the SEC. The combined company financial information included in this press release has not been audited or reviewed by Nano Dimension's auditors and such information is provided for illustrative purposes only. You should note that such combined company information has not been prepared in accordance with and does not purport to comply with Article 11 of Regulation S-X under the U.S. Securities Act of 1933, as amended (the "Securities Act'). Except as otherwise required by law, Nano Dimension undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. References and links to websites have been provided as a convenience, and the information contained on such websites is not incorporated by reference into this press release. Nano Dimension is not responsible for the contents of third-party websites.
No Offer or Solicitation
This press release is not intended to and shall not constitute an offer to buy or sell or the solicitation of an offer to buy or sell any securities, or a solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made, except by means of a prospectus meeting the requirements of Section 10 of the Securities Act.
Additional Information about the Transaction and Where to Find It
In connection with the proposed transaction, DM filed a definitive proxy statement with the SEC on August 15, 2024. DM may also file other relevant documents with the SEC regarding the proposed transaction. This document is not a substitute for the proxy statement or any other document that DM may file with the SEC. The definitive proxy statement has been mailed to shareholders of DM. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE PROXY STATEMENT AND ANY OTHER RELEVANT DOCUMENTS THAT MAY BE FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY IF AND WHEN THEY BECOME AVAILABLE BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors and security holders can obtain free copies of the proxy statement and other documents containing important information about DM and the proposed transaction at the website maintained by the SEC at http://www.sec.gov. Copies of the documents filed with the SEC by the Company are available free of charge on DM's website at https://ir.desktopmetal.com/sec-filings/all-sec-filings.
Participants in the Solicitation
Nano Dimension, DM and certain of their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from DM shareholders in respect of the proposed transaction. Information about the directors and executive officers of Nano Dimension, including a description of their direct or indirect interests, by security holdings or otherwise, is set forth in Nano's Annual Report on Form 20-F for the fiscal year ended December 31, 2023, which was filed with the SEC on March 21, 2024. Information about the directors and executive officers of DM, including a description of their direct or indirect interests, by security holdings or otherwise, is set forth in DM's proxy statement for its 2024 Annual Meeting of Stockholders, which was filed with the SEC on April 23, 2024 and DM's Annual Report on Form 10-K for the fiscal year ended December 31, 2023, which was filed with the SEC on March 15, 2024. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, is contained in the proxy statement and other relevant materials filed with the SEC regarding the proposed transaction. Investors should read the proxy statement carefully before making any voting or investment decisions. You may obtain free copies of these documents from Nano Dimension or DM using the sources indicated above.
NANO DIMENSION INVESTOR RELATIONS CONTACT
Tomer Pinchas, CFO & COO |
Unaudited Consolidated Statements of Financial Position as at
June 30,
December 31,
2023
2024
20232
(In thousands of USD)
(Unaudited)
(Unaudited)
Assets
Cash and cash equivalents
454,555
231,777
309,571
Bank deposits
499,841
532,042
541,967
Restricted deposits
60
60
60
Trade receivables
12,523
12,150
12,710
Other receivables
5,360
5,134
11,290
Inventory
19,546
19,289
18,390
Total current assets
991,885
800,452
893,988
Restricted deposits
858
875
881
Investment in securities
172,185
81,342
138,446
Deferred tax
249
—
—
Other receivables
826
—
—
Property plant and equipment, net
14,014
15,969
16,716
Right-of-use assets
14,135
10,104
12,072
Intangible assets
—
2,235
2,235
Total non-current assets
202,267
110,525
170,350
Total assets
1,194,152
910,977
1,064,338
Liabilities
Trade payables
3,216
2,935
4,696
Other payables
21,173
20,374
25,265
Current portion of lease liability
4,611
3,558
4,473
Current portion of bank loan
274
139
38
Total current liabilities
29,274
27,006
34,472
Liability in respect of government grants
1,882
2,019
1,895
Employee benefits
2,485
3,698
2,773
Liability in respect of warrants
140
—
—
Long term lease liability
10,168
7,652
8,742
Deferred tax liabilities
—
—
75
Bank loan
647
347
595
Total non-current liabilities
15,322
13,716
14,080
Total liabilities
44,596
40,722
48,552
Equity
Non-controlling interests
892
618
1,011
Share capital
396,238
405,690
400,700
Share premium and capital reserves
1,298,124
1,301,022
1,299,542
Treasury shares
(24,768
)
(167,651
)
(97,896
)
Foreign currency translation reserve
1,176
1,252
2,929
Remeasurement of net defined benefit liability (IAS 19)
1,448
(726
)
707
Accumulated loss
(523,554
)
(669,950
)
(591,207
)
Equity attributable to owners of the Company
1,148,664
869,637
1,014,775
Total equity
1,149,556
870,255
1,015,786
Total liabilities and equity
1,194,152
910,977
1,064,338
____________________2 The December 31, 2023 balances were derived from the Company's audited annual financial statements.
Unaudited Consolidated Statements of Profit or Loss and Other Comprehensive Income
Six Months EndedJune 30,
Three Months EndedJune 30,
Year EndedDecember 31,2023
2023
2024
2023
2024
Thousands
Thousands
Thousands
Thousands
Thousands
USD
USD
USD
