voxeljet AG

If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Johannes Pesch, Director of Investor Relations and Business Development for VoxelJet. Thank you. You may begin.

Thank you, operator, and good morning, everyone. With me today are Dr. Ingo Edera, VoxelJet Chief Executive Officer, and Rudy Franz, VoxelJet Chief Financial Officer. Yesterday, after the market closed, WaspSense issued a press release announcing its fourth quarter and four-year financial results for the period ended December 31, 2021. The release, as well as the accompanying presentation for this conference call, is available in the investor relations section of the company's website at WaspSense.com. During our call, you may make certain forward-looking statements about the company's performance, including expectations and results from our current quarter backlog. Such forward-looking statements are not guarantees of future performance and therefore one should not stay undue reliant upon them. Forward-looking statements are also subject to inherent risks as the risks and uncertainties that could cause actual results to differ materially from those expressed including the risks and uncertainties caused by the current COVID-19 pandemic and the residing uncertainty in the global economy. For additional information concerning factors that could cause actual results to differ from those discussed in our forward-looking statements, you should refer to the cautionary statements contained in our pledge release, as well as the risk factors contained in the company's signings with the Securities and Exchange Commission. With that, I would now like to turn the call over to Ingo, Chief Executive Officer of Orsupchat.

Thank you, Johannes. Good morning, everyone. Thank you for joining us on our earnings call today. Please, let's turn to slide four. Our rules reach back to the year 1995 with the first successful dosing of UV resin. In the context of a hidden project, initial 3D printing tests were performed at the Technical University of Munich. I co-founded the company on May 5th, 1999 as a spin-off from the university with a clear vision in mind to establish new manufacturing standards. Today we provide our customers a strategic competitive advantage by upgrading the existing conventional production methods to additive manufacturing solutions. We push technology boundaries and develop new generated processes for the serious production of complex components. Let's turn to slide five, where we describe our technology. In the additive manufacturing market, there are likely more than 10 different technologies, each with its specified specialized field of application. We use a technology called binder jetting. Binder jetting is especially suited for high-volume manufacturing because of its potential to scale. With our VJDX technology, we are pushing new boundaries. On slide 6, you can find a high-level overview of our company. I would like to focus on recent key developments and how we believe these milestones will help us on our mission to establish new manufacturing standards. We ended 2021 with a number of notable achievements that underscore the growing demand across our product portfolio. Increasingly favorable market dynamics and greater recognition of Worcestershire's leading 3D printing technology for industrial applications. In September 2021, we announced that together with GE Renewable Energy, we plan to develop the world's largest binder jet 3D printer for the production of critical components for next-generation wind turbines called Heli8X. In a later slide, we have included some images of this exciting project. In October 2021, we announced that Brose, a leading global supplier to the electric car industry, is the first client in the beta program for our new large high-speed distant ring printer. In November 2021, we announced the partnership with Covestro, a multibillion-dollar chemical company to advance additive manufacturing in series production. And in December 2021, we received the final acceptance for the first VJX unit from our partners, which includes a leading German carmaker. VJX is a new 3D printer with extreme performance for high volume industrial applications. In a later slide, we have summarized a timeline of this exciting project. Keep in mind, we developed a completely new 3D printer and a next generation print engine which is much faster than previous versions. This new print engine has a layer time of four seconds. In addition, together with our partners, we developed a new inorganic binding system for maximum environmental compatibility. Overall, the fourth quarter 2021 was a record quarter in sales for our company, and we are pleased to see that this momentum has continued in the first month of the new year. In our 3D parts production centers, especially in Germany, we were at overcapacity for the first months of the new year. This is great to see. On slide seven, you can see pictures of our production facilities in Germany, US, and China. Let me briefly explain our two business segments. In the services segment, top left side of the slide, we operate our own 3D printers in three facilities around the world, to offer affordable on-demand access to all technology. The barriers to entry are very low as customers just need to send in the 3D data and we will print parts for them. This is a great and easy way for our customers to understand new business opportunities in 3D printing. The short sales cycles and services helps us balance the typical long sales cycle in our system segment. Customers come from various industries including automotive, aerospace, general engineering, as well as art and architecture. In the US, one of our largest on-demand printing clients is a supplier to a leading space exploration company. In our system segment, we manufacture and sell integrated high-speed large format 3D printing systems geared towards mass production of complex models, molds, and direct parts. Systems revenue also includes recurring revenue from the sale of consumables, maintenance contracts, upgrades and other after sales activities. Let's turn to slide eight and an illustration of the wide range of applications of our technology. We are encouraged by the many discussions that we are having with different players in a broad variety of industries who are all seriously looking at adopting our technology for well-chosen applications. To give you some examples, There is an innovative yacht company producing several thousands of advanced propellers with our technology. There are leading US-based exploration companies using our technology to make their rockets more aerodynamic. There are car makers using our technology to make their vehicles more lightweight and energy efficient. There's a leading Swiss university in Zurich, the ETH, using our technology to make the most amazing concrete structures. And there are many more. Simultaneously, we are seeing that the effective adoption of 3D printing not only requires investments, but also very important transformal shifts in the ecosystem. This, for example, includes pre- and post-processing of the 3D printed parts. We believe that we are ahead of our competition in this regard because of the experience we have already gained through VJX. Let's turn to slide 9 and some thoughts on the additive manufacturing market. As you can see, Wallace Associates projects growth to accelerate over the next years. This growth will be driven by a larger share of sales to manufacturing. So how could this opportunity become? How big? If you assume that the global economy is about $80 trillion, and if you assume that manufacturing accounts for 16% of it, This would put the manufacturing economy at around $12.8 trillion. If additive manufacturing captures only 5% of the manufacturing economy, it could potentially be a $640 billion industry. So this technology is ready to start meeting manufacturing needs. Post-pandemic, we need to create versatility. We need localization. We need to make sure that we have flexibility. This is something we hear in almost every discussion that we have with our customers. I believe we are in an excellent position to capture our fair share of this growing market over the next years, because what really differentiates us from the other players in the 3D printing industry is our focus on solutions for manufacturing or industrial production at scale. I would estimate that with our current portfolio of 3D printers, Our share in sales to manufacturing is already higher than any of our competitors. I expect our position to grow further significantly with WidgetX and the new high-decentral printer. I believe so because we are working with leading industrial OEMs. Basically, since our foundation, we sold our first 3D printers to BMW and Daimler 20 years ago. In addition, our technology evolved significantly over the last years in terms of speed, accuracy, and the degree of automation of the whole process chain. Slide 10 shows our global sales network and production footprint. As you can see, we have reached an established position in all major markets in Europe, the US, as well as Asia. We stopped our activities in Russia and Belarus until further notice. Turning to slide 11. On the left side, we have summarized our USPs. We differentiate ourselves from our competitors by build size, material diversity, and speed. This leads to a complete set of industrial 3D printers to support critical, demanding applications and address the challenges and needs that are most important to our customers. Each model can be used with multiple material sets. For example, we offer the VX1000 3D printer for the printing of highly accurate sand casting molds or ceramics, or as a plastic polymerization printer. On the bottom right side of this slide, you can see some of our new products. With these new printers, we believe we can increase our total addressable markets considerably. We can target new applications within existing customer groups, for example, with DigitX. With high-speed sintering, we can address both new and existing markets, like, for example, audio equipment, automotive interiors, exteriors, ceilings, gaskets, valves, grippers, and other custom consumer products. Let's start with the formal part of the presentation. I will begin with an overview of the results for the fourth quarter. Guddi will then provide a more in-depth view of our financials for the fourth quarter and full year 2021 and our outlook for 2022. Following his comments, we will be happy to take your questions. Turning to slide 13. Total revenue for the fourth quarter this year increased 23% to 10.9 million euros as compared to 8.9 million euros in the fourth quarter last year. This is a new record in quarterly revenue for our company and a great achievement for the whole team. Also, we reached an important profitability milestone with a positive EBITDA for the quarter. In services, our on-demand 3D printing segment, we saw a strong quarter with continued high demand for our product, and quarterly revenues grew 12% from a strong quarter year over year. In systems, we sold nine printers in the fourth quarter this year as compared to eight printers in the fourth quarter 2020. Notably, we sold a higher number of larger-scale printers, which generate higher revenues and higher gross margins. Looking at the right side of this slide in gross margins, we are very pleased with high gross profit and gross profit margins in our German on-demand printing center and also see improvements in our US and Chinese facilities. In systems, gross profit margin from the sale of 3D printers increased. This was offset by a one-time non-recurring change in the reserve for slow-moving ink control. This is a non-cash item. We see some changes when it comes to lead times for certain components for our printers, and we are working with our suppliers on this. Slide 14 breaks down order backlog by quarters, revenue by geography, and operating expenses by category. When looking at revenue by geographic region, we target an even distribution across the free regions to hedge against risk from local events. Let's move to slide 15 and overview of VJX, the new high-speed sintering printer and our project with GE Renewable Energy. We believe these new products will help us capture a significant portion of manufacturing-related revenue. Keep in mind, these printers are made for automated industrial production. Let's start with VJX from slide 16. In December 2021, we have received the final acceptance for the first two VJX units from the premium carmaker and our partners. This acceptance is the trigger for revenue recognition. In addition, we are finalizing the negotiations regarding a long-term maintenance package. This is excellent news. Quick recap, the tender phase for this ambitious project started in 2017. and we were selected by the carmaker in 2018. In June 2019, we presented the new 3D printing solution to the public for the first time at a large trade show and delivered the first printers to the carmaker. In the next two years, and together with our partners, we have developed and implemented significant changes and upgrades. This includes improvements regarding the printing engine, the binder composition, the truing of the 3D printed cores in the industrial microwave oven, and the robotic handling of the 3D printed core. Our technology evolved significantly over this time in terms of speed, accuracy, and degree of automation of the whole process chain. In August and September 2020, we received orders for the next three widget X units. In February 2021, we started to supply parts for pre-series production, and in December 2021, we received the final acceptance for the first two units. Why exactly is this technology relevant for our customers? Because VJX is very fast and all processes are automated. We expect that you can print several hundred thousand parts per year with a single one production slot. Components made with this technology are so complex that you cannot make it efficiently with conventional manufacturing. You need to match 3D print with sand cores and then cast them. Direct metal printing is not an option here because the cost per part are many orders of magnitude higher as compared to our more efficient approach of combining 3D printing and conventional manufacturing. On slide 17, you can see an image of this cutting edge printing engine linked to a video. Let's move to slide 18 and our sintering technology. You're often asked how HP's MultiJet Fusion compares to our high-speed sintering process and what the key differentiations are. From the outside, there is not much difference, but processes print black ink onto a powder bed and then simply the printed powder with an IR lamp. But if you look closer, you will see significant differences. We use a different jetting engine technology than HP. Without going into technical details here, our approach allows us, together with the clever self-balancing IR lamp design, to skip the second print fluid or detailing agent. This means that our process is cheaper in operation for our customers and results in lower cost per part. Also, powder from our machines needs less heat than that of our competitors, which means it degrades more slowly and should be easier to recycle. The improved temperature management from the IR lamp setup allows us to process large build areas without major problems from temperature-induced warping. Over the next years, you will see that a growing number of parts currently made out of metal will instead be manufactured with high-performance plastic polymers. Engineering thermoplastic materials provide consistent strength and stiffness and outstanding impact performance for metal replacements. They are also lighter and can maintain structural performance at high temperatures and resist corrosion. We believe that the sales opportunity for 3D printing and the manufacturing of high-performance plastic polymers can become larger than the opportunity in metal printing. We want to capture a significant portion of this growing market with our new large high-speed sintering printers. On slide 19, we summarize another blockbuster project Together with GE Renewable Energy, we plan to develop the world's largest binder generating 3D printer. This new 3D printer is expected to streamline the production of key components of GE's Halyard X offshore wind turbine, which are among the world's largest and most efficient units of this type. We are proud to be part of this groundbreaking project in the field of renewable energy and will provide pictures over the year as we just started the process of ordering parts and assembling the first prototype component. To summarize, a key focus that will create separation for us over the long term is our expertise and IP in binder chatting for additive series production. Ultimately, it is about becoming more productive at scale, and I'm highly confident in our ability to execute on this. With that, I would now like to turn the call over to Rudi.