Release Date: July 31, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Materialise NV (MTLS, Financial) achieved record quarterly revenue of EUR68.8 million, marking a growth of over 6% compared to Q2 2023.
- The company reported a gross margin of 57%, consistent with the previous year, indicating stable profitability.
- Materialise NV (MTLS) increased its adjusted EBITDA to EUR3.9 million, representing 5.6% of revenue, despite intensified R&D investments.
- The acquisition of FEops is expected to create growth opportunities in the medical segment, particularly in the cardiovascular market.
- Materialise NV (MTLS) formed a strategic partnership with nTop, enhancing its ability to process complex 3D printing designs efficiently.
Negative Points
- The prototyping market continues to show structural weakness, which may impact future growth in the manufacturing segment.
- The integration of FEops is expected to have a limited negative impact on EBIT initially due to integration costs and further investments.
- Despite growth, the software segment's adjusted EBITDA margin decreased due to intensified R&D efforts.
- The manufacturing segment faces challenges from continued low prototyping demand, affecting overall growth potential.
- High capital expenditures, particularly in the new ACTech plant, are impacting free cash flow, keeping it close to breakeven.
Q & A Highlights
Q: Can you provide more details on the financial impact of the FEops acquisition?
A: Koen Berges, CFO, explained that the acquisition will not materially impact the net cash position. However, it will require further cash outflows to support FEops' growth, including R&D investments and working capital needs. The integration will initially have a limited negative impact on EBIT, expected to decrease over time as revenue grows and cost synergies are implemented.
Q: Will the revenue from FEops be categorized under the medical business or 3D software?
A: Brigitte de Vet, CEO, confirmed that the revenue from FEops will be categorized under the medical business.
Q: How much of the medical business revenue is related to software?
A: Koen Berges, CFO, stated that approximately 30% of the total medical revenue is related to software.
Q: Is the recurring revenue in the software segment growing, and can we expect growth in this business?
A: Koen Berges, CFO, noted that recurring revenue is indeed increasing quarter by quarter. The transition to a recurring business model will continue for several quarters, impacting the top line positively over time.
Q: What caused the large year-over-year improvement in the medical segment's EBITDA?
A: Koen Berges, CFO, attributed the improvement to the absence of an adverse arbitration award that impacted the previous year's results.
Q: What is the outlook for the prototyping market and ACTech's capacity utilization?
A: Brigitte de Vet, CEO, mentioned that the prototyping market faces structural weakness, which is expected to persist. Regarding ACTech, the new plant opening in September will gradually impact capacity utilization, with further capacity additions planned over the coming months and years.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
