R&D expense was $4.3 million in the 2017 first half compared with $3.8 million in the 2016 first half, with the increase primarily occurring in the second quarter previously described.
SG&A for the 2017 first half was $12.3 million, up $2.3 million compared with the prior-year period. The increase was principally due to the factors previously described for the second quarter, as well as an impairment of intangible assets of $0.3 million associated with exited product lines and an increase in selling costs to support revenue growth.
The net loss was $13.2 million, or $0.82 per share, for the first half of 2017 compared with $8.4 million, or $0.53 per share, in the 2016 first half.
Adjusted EBITDA was an $8.6 million loss in the first half of 2017, compared with a $5.0 million loss in last year’s first half. ExOne management believes that when used in conjunction with other measures prepared in accordance with GAAP, that Adjusted EBITDA, a non-GAAP measure, assists in the understanding of its financial results. See the attached tables for important disclosures regarding the Company’s use of Adjusted EBITDA as well as a reconciliation of net loss to Adjusted EBITDA for the six months ended June 30, 2017 and 2016.
Capitalization – Cash Impacted by Inventory Build and Technology Investments
Cash, cash equivalents and restricted cash as of June 30, 2017 were $25.2 million, compared with $28.2 million at December 31, 2016. Cash used for operating activities during the first half of 2017 and 2016 was $6.9 million and $0.2 million, respectively. The first half 2017 cash used for operating activities reflects the impact of a higher net loss and increased working capital usage, primarily to support anticipated sales volume in the second half of 2017. Cash capital expenditures were $0.4 million for the first half of 2017 compared with $0.3 million for the first half of 2016. The first half of 2017 included $3.7 million of cash proceeds from the sale of property and equipment associated facility exits.
Outlook – Updating Sales Outlook Modestly, Reiterating Adjusted EBITDA Expectations
Mr. McCarley concluded, “We are revising our 2017 revenue outlook modestly, to a range of 20% to 25% growth. Our guidance is based on our backlog and anticipated growth in the second half, particularly in the fourth quarter. In the third quarter, we expect the Exerial™ beta machine sales will unfavorably impact earnings and we will continue to make investments in organizational and R&D activities. However, we remain convinced that these costs will prove to be good investments and we remain on track to reach positive Adjusted EBITDA by the end of the year. Additionally, we expect a total cash balance in excess of $20 million at year end.”
Webcast and Conference Call
ExOne will host a conference call and live webcast on Thursday, August 10 at 8:30 a.m. Eastern Time. During the conference call and webcast, management will review the financial and operating results for the 2017 second quarter, along with ExOne’s corporate strategies and outlook. A question-and-answer session will follow. The teleconference can be accessed by calling (201) 689-8470. The webcast can be monitored on the Company’s website at www.investor.exone.com/
A telephonic replay of the conference call will be available from 11:30 a.m. ET on the day of the teleconference through Thursday, August 17, 2017. To listen to a replay of the call, dial (412) 317-6671 and enter the conference ID number 13665986, or access the webcast replay via the Company’s website, where a transcript will also be posted once available.
About ExOne
ExOne is a global provider of 3D printing machines and 3D printed and
other products, materials and services to industrial customers. ExOne's
business primarily consists of manufacturing and selling 3D printing
machines and printing products to specification for its customers using
its installed base of 3D printing machines. ExOne’s machines serve
direct and indirect applications. Direct printing produces a component;
indirect printing makes a tool to produce a component. ExOne offers
pre-production collaboration and print products for customers through
its network of ExOne Adoption Centers (EACs) and Production Service
Centers (PSCs). ExOne also supplies the associated materials, including
consumables and replacement parts, and other services, including
training and technical support that is necessary for purchasers of its
3D printing machines to print products. The Company believes that its
ability to print in a variety of industrial materials, as well as its
industry-leading volumetric output (as measured by build box size and
printing speed) uniquely position ExOne to serve the needs of industrial
customers.
