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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2020

OR

TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission File No. 001-35806

 

The ExOne Company

(Exact name of registrant as specified in its charter)

 

 

Delaware

 

46-1684608

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

127 Industry Boulevard

North Huntingdon, Pennsylvania 15642

(Address of principal executive offices) (Zip Code)

(724) 863-9663

(Registrant’s telephone number, including area code)

 

Securities registered pursuant to Section 12(b) of the Exchange Act:

Title of class

Trading symbol

Name of exchange on which registered

Common stock

XONE

The Nasdaq Stock Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     Yes      No  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes      No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

Accelerated filer

Non-accelerated filer

 

Smaller reporting company

 

 

 

Emerging growth company

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No  

As of November 5, 2020, 19,187,490 shares of common stock, par value $0.01, were outstanding.

 

 

 

 


PART I – FINANCIAL INFORMATION

Item 1.     Financial Statements.

The ExOne Company and Subsidiaries

Condensed Statement of Consolidated Operations and Comprehensive Loss (Unaudited)

(in thousands, except per-share amounts)

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Revenue

 

$

17,399

 

 

$

10,884

 

 

$

41,881

 

 

$

35,742

 

Cost of sales

 

 

13,500

 

 

 

8,006

 

 

 

31,263

 

 

 

25,080

 

Gross profit

 

 

3,899

 

 

 

2,878

 

 

 

10,618

 

 

 

10,662

 

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

2,013

 

 

 

2,430

 

 

 

6,858

 

 

 

7,399

 

Selling, general and administrative

 

 

4,825

 

 

 

5,326

 

 

 

15,476

 

 

 

16,916

 

Gain from sale-leaseback of property and equipment

 

 

 

 

 

 

 

 

(1,462

)

 

 

 

 

 

 

6,838

 

 

 

7,756

 

 

 

20,872

 

 

 

24,315

 

Loss from operations

 

 

(2,939

)

 

 

(4,878

)

 

 

(10,254

)

 

 

(13,653

)

Other expense (income)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

54

 

 

 

85

 

 

 

171

 

 

 

227

 

Other expense (income)   ̶  net

 

 

314

 

 

 

(134

)

 

 

319

 

 

 

(65

)

 

 

 

368

 

 

 

(49

)

 

 

490

 

 

 

162

 

Loss before income taxes

 

 

(3,307

)

 

 

(4,829

)

 

 

(10,744

)

 

 

(13,815

)

(Benefit) provision for income taxes

 

 

(34

)

 

 

15

 

 

 

200

 

 

 

(686

)

Net loss

 

$

(3,273

)

 

$

(4,844

)

 

$

(10,944

)

 

$

(13,129

)

Net loss per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

(0.19

)

 

$

(0.30

)

 

$

(0.65

)

 

$

(0.81

)

Diluted

 

$

(0.19

)

 

$

(0.30

)

 

$

(0.65

)

 

$

(0.81

)

Comprehensive loss:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(3,273

)

 

$

(4,844

)

 

$

(10,944

)

 

$

(13,129

)

Other comprehensive income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustments

 

 

856

 

 

 

(1,387

)

 

 

388

 

 

 

(1,580

)

Comprehensive loss

 

$

(2,417

)

 

$

(6,231

)

 

$

(10,556

)

 

$

(14,709

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

2


The ExOne Company and Subsidiaries

Condensed Consolidated Balance Sheet (Unaudited)

(in thousands, except per-share and share amounts)

 

 

 

September 30,

 

 

December 31,

 

 

 

2020

 

 

2019

 

Assets

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

39,428

 

 

$

5,265

 

Restricted cash

 

 

508

 

 

 

978

 

Accounts receivable  ̶  net

 

 

5,540

 

 

 

6,522

 

Current portion of net investment in sales-type leases

 

 

225

 

 

 

213

 

Inventories  ̶  net

 

 

22,187

 

 

 

19,770

 

Prepaid expenses and other current assets

 

 

3,848

 

 

 

2,182

 

Total current assets

 

 

71,736

 

 

 

34,930

 

Property and equipment  ̶  net

 

 

20,924

 

 

 

38,895

 

Operating lease right-of-use assets

 

 

4,278

 

 

 

432

 

Net investment in sales-type leases  ̶  net of current portion

 

 

568

 

 

 

738

 

Other noncurrent assets

 

 

260

 

 

 

371

 

Total assets

 

$

97,766

 

 

$

75,366

 

Liabilities

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Current portion of long-term debt

 

$

1,496

 

 

$

153

 

Current portion of operating lease liabilities

 

 

1,843

 

 

 

158

 

Accounts payable

 

 

4,445

 

 

 

5,818

 

Accrued expenses and other current liabilities

 

 

5,163

 

 

 

6,942

 

Current portion of contract liabilities

 

 

12,732

 

 

 

11,846

 

Total current liabilities

 

 

25,679

 

 

 

24,917

 

Long-term debt  ̶  net of current portion

 

 

1,948

 

 

 

1,211

 

Operating lease liabilities  ̶  net of current portion

 

 

2,435

 

 

 

274

 

Contract liabilities  ̶  net of current portion

 

 

156

 

 

 

286

 

Other noncurrent liabilities

 

 

365

 

 

 

96

 

Total liabilities

 

 

30,583

 

 

 

26,784

 

Contingencies and commitments

 

 

 

 

 

 

 

 

Stockholders' equity

 

 

 

 

 

 

 

 

Common stock, $0.01 par value, 200,000,000 shares authorized,

   18,988,099 (2020) and 16,346,960 (2019) shares issued and outstanding

 

 

190

 

 

 

163

 

Additional paid-in capital

 

 

205,980

 

 

 

176,850

 

Accumulated deficit

 

 

(127,892

)

 

 

(116,948

)

Accumulated other comprehensive loss

 

 

(11,095

)

 

 

(11,483

)

Total stockholders' equity

 

 

67,183

 

 

 

48,582

 

Total liabilities and stockholders' equity

 

$

97,766

 

 

$

75,366

 

 

 

 

 

 

 

 

 

 

 

 

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

3


The ExOne Company and Subsidiaries

Condensed Statement of Consolidated Cash Flows (Unaudited)

(in thousands)

 

 

 

Nine Months Ended

 

 

 

September 30,

 

 

 

2020

 

 

2019

 

Operating activities

 

 

 

 

 

 

 

 

Net loss

 

$

(10,944

)

 

$

(13,129

)

Adjustments to reconcile net loss to net cash used for operations:

 

 

 

 

 

 

 

 

Depreciation

 

 

2,925

 

 

 

3,491

 

Equity-based compensation

 

 

828

 

 

 

1,076

 

Amortization of debt issuance costs

 

 

39

 

 

 

70

 

(Recoveries) provision for bad debts  ̶  net

 

 

(4

)

 

 

264

 

Provision for slow-moving, obsolete and lower of cost or

   net realizable value inventories  ̶  net

 

 

335

 

 

 

37

 

Foreign exchange losses (gains) on intercompany transactions  ̶  net

 

 

250

 

 

 

(127

)

Gain from sale-leaseback of property and equipment

 

 

(1,462

)

 

 

 

Gain from disposal of property and equipment  ̶  net

 

 

(1

)

 

 

(2

)

Deferred income taxes

 

 

195

 

 

 

 

Changes in assets and liabilities, excluding effects of foreign currency

   translation adjustments:

 

 

 

 

 

 

 

 

Decrease in accounts receivable

 

 

1,092

 

 

 

2,790

 

Decrease in net investment in sales-type leases

 

 

158

 

 

 

218

 

Increase in inventories

 

 

(3,310

)

 

 

(4,373

)

Increase in prepaid expenses and other assets

 

 

(1,681

)

 

 

(827

)

(Decrease) increase in accounts payable

 

 

(1,679

)

 

 

1,822

 

Increase (decrease) in accrued expenses and other liabilities

 

 

396

 

 

 

(1,934

)

Increase in contract liabilities

 

 

248

 

 

 

6,301

 

Net cash used for operating activities

 

 

(12,615

)

 

 

(4,323

)

Investing activities

 

 

 

 

 

 

 

 

Capital expenditures

 

 

(772

)

 

 

(613

)

Proceeds from sale of property and equipment

 

 

16,229

 

 

 

3

 

Net cash provided by (used for) investing activities

 

 

15,457

 

 

 

(610

)

Financing activities

 

 

 

 

 

 

 

 

Proceeds from borrowings on long-term debt

 

 

2,194

 

 

 

 

Proceeds from related party revolving credit facility

 

 

 

 

 

2,000

 

Payments on long-term debt

 

 

(117

)

 

 

(111

)

Proceeds from at-the-market offerings of common stock, net of issuance costs

 

 

27,699

 

 

 

 

Taxes related to the net share settlement of equity-based awards

 

 

(15

)

 

 

(68

)

Proceeds from exercise of employee stock options

 

 

858

 

 

 

289

 

Other

 

 

(63

)

 

 

(10

)

Net cash provided by financing activities

 

 

30,556

 

 

 

2,100

 

Effect of exchange rate changes on cash, cash equivalents, and restricted cash

 

 

295

 

 

 

(187

)

Net change in cash, cash equivalents, and restricted cash

 

 

33,693

 

 

 

(3,020

)

Cash, cash equivalents, and restricted cash at beginning of period

 

 

6,243

 

 

 

9,140

 

Cash, cash equivalents, and restricted cash at end of period

 

$

39,936

 

 

$

6,120

 

Supplemental disclosure of noncash investing and financing activities

 

 

 

 

 

 

 

 

Transfer of internally developed 3D printing machines from inventories to

   property and equipment for internal use or leasing activities

 

$

1,434

 

 

$

1,635

 

Transfer of internally developed 3D printing machines from property

   and equipment to inventories for sale

 

$

2,771

 

 

$

485

 

Property and equipment included in accounts payable

 

$

113

 

 

$

48

 

At-the-market offering issuance costs included in accounts payable

 

$

147

 

 

$

 

At-the-market offering issuance costs included in accrued expenses

   and other current liabilities

 

$

66

 

 

$

 

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

4


The ExOne Company and Subsidiaries

Condensed Statement of Changes in Consolidated Stockholders’ Equity (Unaudited)

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

other

 

 

Total

 

 

 

Common stock

 

 

Additional

 

 

Accumulated

 

 

comprehensive

 

 

stockholders'

 

 

 

Shares

 

 

$

 

 

paid-in capital

 

 

deficit

 

 

loss

 

 

equity

 

Balance at December 31, 2018

 

 

16,234

 

 

$

162

 

 

$

175,214

 

 

$

(101,853

)

 

$

(10,748

)

 

$

62,775

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(4,496

)

 

 

 

 

 

(4,496

)

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(776

)

 

 

(776

)

Equity-based compensation

 

 

 

 

 

 

 

 

439

 

 

 

 

 

 

 

 

 

439

 

Exercise of employee stock options

 

 

23

 

 

 

1

 

 

 

164

 

 

 

 

 

 

 

 

 

165

 

Tax withholding related to the net share settlement

   of equity-based awards

 

 

 

 

 

 

 

 

(68

)

 

 

 

 

 

 

 

 

(68

)

Common stock issued from equity incentive plan

 

 

38

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at March 31, 2019

 

 

16,295

 

 

$

163

 

 

$

175,749

 

 

$

(106,349

)

 

$

(11,524

)

 

$

58,039

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(3,789

)

 

 

 

 

 

(3,789

)

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

583

 

 

 

583

 

Equity-based compensation

 

 

 

 

 

 

 

 

642

 

 

 

 

 

 

 

 

 

642

 

Exercise of employee stock options

 

 

13

 

 

 

 

 

 

97

 

 

 

 

 

 

 

 

 

97

 

Common stock issued from equity incentive plan

 

 

10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at June 30, 2019

 

 

16,318

 

 

$

163

 

 

$

176,488

 

 

$

(110,138

)

 

$

(10,941

)

 

$

55,572

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(4,844

)

 

 

 

 

 

(4,844

)

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,387

)

 

 

(1,387

)

Equity-based compensation

 

 

 

 

 

 

 

 

(5

)

 

 

 

 

 

 

 

 

(5

)

Exercise of employee stock options

 

 

4

 

 

 

 

 

 

27

 

 

 

 

 

 

 

 

 

27

 

Common stock issued from equity incentive plan

 

 

25

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-

 

Balance at September 30, 2019

 

 

16,347

 

 

$

163

 

 

$

176,510

 

 

$

(114,982

)

 

$

(12,328

)

 

$

49,363

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at December 31, 2019

 

 

16,347

 

 

$

163

 

 

$

176,850

 

 

$

(116,948

)

 

$

(11,483

)

 

$

48,582

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(3,648

)

 

 

 

 

 

(3,648

)

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(838

)

 

 

(838

)

Equity-based compensation

 

 

 

 

 

1

 

 

 

291

 

 

 

 

 

 

 

 

 

292

 

Common stock issued from equity incentive plan

 

 

39

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at March 31, 2020

 

 

16,386

 

 

$

164

 

 

$

177,141

 

 

$

(120,596

)

 

$

(12,321

)

 

$

44,388

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(4,023

)

 

 

 

 

 

(4,023

)

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

370

 

 

 

370

 

Equity-based compensation

 

 

 

 

 

 

 

 

157

 

 

 

 

 

 

 

 

 

157

 

Exercise of employee stock options