3D Systems Corporation · NYSE:DDD
3D Systems — 2007 Needham Conference
54 slides from 3D Systems's conference presentation, Jan 10, 2007
Slide 1: Transform Your Products
January 10, 2006 Ey) NASDAQ: 1D8¢ Transform Your Products, systevs WWw.3dsystems.com
Slide 2: Forward-Looking Statements
Forward-Looking Statements Certain statements made in this presentation that are not statements of historical or current facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward- looking statements may involve known and unknown risks, u
Slide 3: 3D Systems Overview
3D Systems Overview $140 MM sales ‘05 350 employees 385 patent : : patents Complete portfolio of affordable office to factory solutions = 150 sales/service personnel Global coverage
Slide 4: To Physical Experience
To Physical Experien Computer Aided Design i Plastic or metal part (CAD)
Slide 5: Comprehensive Portfolio
svSTEMS Comprehensive Portfolio 3-D Printing Stereolithography Laser Sintering q ‘Accura® plastics ‘& composites: het 60 plastic Bludstone™ —___Ametyst™
Slide 6: Industrial
Industrial CATERPILLAR | SIEMENS || ruxe| @ MOTOROLA ROBERTODEMEGLIO Experience ©
Slide 7: Consumer
- Consumer LEVER FABERGE ITALIA Experience Polaroid § EMERSON
Slide 8: Automotive
Automotive DAIMLERCHRYSLER Ss \\) Rp UTAutomotive
Slide 9: Aerospace
Aerospace QU Pratt & Whitney AcRosvstems
Slide 10: Motorsports
Motorsports a RENAULT |) Team PocciPoLm) = ROBERT YATES MEEK mie weak Slide 10
Slide 11: Service Providers
Service Providers AR Dynacept SOLID @) Harvest ] Wy Soe % svSTEMS
Slide 12: Healthcare
Healthcare ® Sandia National Laboratories WIDEX< hearing instruments. invisalign’ PHONAK hearing systems : g g i otic Walter Reed Army Medical Center Slide 12
Slide 13: Customer Value
Customer Value «= Reduce ey >» Design cost 2 > Manufacturing cost g = Cost of Goods u Profitability MH i g = Reduce a > Time to design g > Time to production = Time to Market Market Share
Slide 14: Slide 14
Slide 15: Financial Restatement Update
Financial Restatement Update = We previously announced that we had “determined that the Company’s financial statements included in our Form 10-Q Reports for the first and second quarters of 2006 contained errors and would be restated. me differenc = We postponed our 3Q06 earnings release and Form 10
Slide 16: 2006 Restatement Impacts
2006 Restatement Impacts = We believe that the identified errors primarily impact the second quarter of 2006 and, to a lesser extent, the first quarter of 2006 & 2 g " We believe that restating our operating results for the M first and second quarters of 2006 should lead to: > An increase in the net
Slide 17: 2004/5 Restatement Impacts
2004/5 Restatement Impacts = We are also restating our audited financial statements for the 2004 and 2005 calendar years. = We believe that the effect of these restatements amounts to less than $1.0 million of net income available to the common stockholders in each of 2004 and 2005. + We believe tha
Slide 18: Q3, 2006 Expectations
Q3, 2006 Expectations Based upon the information that is currently available, we believe that we will report a loss for the third quarter of 2006 > Consolidated revenue for the third quarter should be in the range of $30.0 to $31.0 million Backlog in the neighborhood of $13.0 million > Net loss avai
Slide 19: Errors Identified
Errors Identified = The 2006 errors identified primarily include: » Invoicing errors and errors in recording customer credits and deposits; and > To a lesser extent = errors and adjustments identified in reconciling . of fixed asset and construction-in-progress accounts and related depreciation; and
Slide 20: How Did We Identify the Errors?
How Did We Identify the Errors? We identified the errors primarily as a result of our efforts to remediate the material weakness that we previously identified and disclosed with respect to our second quarter 2006 financial statements through: = Our ongoing progress toward completing the implementati
Slide 21: Other Significant Events
Other Significant Events « Grand Junction, CO Facility Sale: >» Entered agreement to sell Grand Junction facility for a price of $7 million >» We expect sale to conclude sale in the first quarter of 2007. u & 5 « Preferred Stock Conversion: g > Converted $15.2 million of preferred stock into common
Slide 22: Next Steps and Timing
Next Steps and Timing 4 = As of today, the estimates or ranges of anticipated 8 adjustments for the 2004, 2005 and 2006 periods g discussed above remain subject to change, and BS additional adjustments may be required for those ® periods = Weare continuing to work as diligently as we can with our ou
Slide 23: Internal Controls Remediation
Internal Controls Remediation As a result of the errors that have led to these restatements, we believe that material weaknesses in our internal control over financial reporting may exist in addition to the previously reported control deficiencies identified and disclosed in connection with closing
Slide 24: State of Business
me differenc Experience SS State of Business We made good progress in resolving the causes of the business disruptions > Our continuing high level of backlog ~$13 million at 9/30/06 suggests that the demand for our products remains strong > Materials’ revenue continued its double- growth in the thir
Slide 25: Extensive Portfolio Transformation
Extensive Portfolio Transformation 2003 Core Products 2006 Current Products Bs 3-D Printing Experience Rapid Manufacturing F Spo ial
Slide 26: Industry Materials Revenue Growth
Industry Materials Revenue Growth (in millions) $250 . & § $200 3S 22% cack) w) $150 v u 5 $100 a 50 ' 1 $0 2001 2002 2003 2004 2005 2006E BA scree: wots Ascites, re
Slide 27: New Product Revenue
me differen Experience New Product Revenue 34% 28% (% of Sales) 13% cy % 2003 Source: 3D Systems Corporation 2004 1Q 2006 Slide 27
Slide 28: Global Competitive Landscape
Global Competitive Landscape Company 30 Systems_| [Stratasys lEos 2corp lover DSM «|e - |@ Huntsman > [=| - @ Objet @ - -|@_.- Envision Teh | - @ -| - @ NRE - |. lo. SL=Stereolithography @) = comprehensive Capabilities Direct = Employees LS= Laser Sintering = Partial Capabilities Indirect = Reseller
Slide 29: Fineline Competitive Web Page
Fineline Competitive Web Page FINELINE ae Experience
Slide 30: Viper Pro Part Detail/Accuracy
Viper Pro Part Detail/Accuracy 8 8 a §
Slide 31: Poly-Jet Part Detail/Accuracy
Poly-Jet Part Detail/ Accuracy Experience ©
Slide 32: FDM Detail / Accuracy
FDM Detail Detail / Accuracy Experience @ SvSTEM:
Slide 33: Strategic Investments $17MM
Ss SvSTEMS Strategic Investments $17MM > New consolidated HQ and R&D facility > Oracle based ERP system > Strategic materials development agreement with Symyx > Supply chain outsourcing to UPS > Expanded R&D facili > New Rapid-Manufacturing Center >» 3D Systems University s and personnel Transform Y
Slide 34: Target Operating Model Remains Unchanged
Target Operating Model... Remains Unchanged! Actual 2004 = 2005 ~—_Long-Term Year Year Target Revenue 100% | 100% | 100% 100% Gross profit 39% | 45% | 45% 50-55% ¢ [Operating expense 53% | 40% | 39% 30-35% BP operating income (14%) 4% 7% 15-25% : Nat Income eveteble'sa:common (24%) 1% 6% 10-15% & De
Slide 35: Employee Productivity
Employee Productivity Revenue Per Employee* ($000’s) Pa $307 $340 me differenc g (3000's) 8 279 Experience SAB 12-month average Number of Employees slide 35
Slide 36: Expected Business Fundamentals
Experience © Expected Business Fundamentals Average Selling Prices expected to hold Cost Of Goods Sold impacted by friction costs Operating Expenses reflect relocation, ERP, restatement, SOX Gross Profit expected to return to historical levels Restoring customer confidence expected to revive healthy
Slide 37: Progress Report
Progress Report Kevin McAlea Vice-President Global Marketing ; | & : .) v g 2g a g
Slide 38: Growth Program: 3-D Printing
Growth Program: 3-D Printing > Proof of concept > Functional testing > Product cost reduction > Purchasing and quotation > Product mockups > Precision casting > Marketing tools » Architecture > Education
Slide 39: 3-D Printing Growth Drivers
3-D Printing Growth Drivers (Based on units) Global Engineering Population 2,600,000 Ee | we \ | 28.5 Million 5 Million accsss.usineia / ECS, ¥ Engineers “weap Users) / Printers a ~ 5 \ —— = \ y yw ‘x 5,500 printers 2005 2008 Source: 3D Systems, CADIgest, engineeringtalk.com, Deskeng.com Slide 29
Slide 40: 3-D Printing Progress
3-D Printing Progress Growing resale channel Introduced $14,900 desk-top 3-D Printer Launched InVision® Dental Pro and announced sale of 10 system in early September Introduced new LD colors Nearing launch of a revolutionary new desktop 3-D Printer
Slide 41: InVision DP 3-D System
IN\/ISION' DP 3-D System sie differen FEATURES + Ready-to-Use lab package + Easy-to-use intuitive software + Precise scanning technology * Outstanding fit and margin line adaptation + Excellent surface finish Experience BENEFITS * Increase productivity-reduce finishing time = Save money-reduce alloy
Slide 42: 3D Printing: Marketing Models
3D Printing: Marketing Models
Slide 43: 3D Printing: Engineering
3D Printing: Engineering ) a2ualsadxz
Slide 44: 3D Printing: Micro-Casting
3D Printing: Micro-Casting eo 5 a = 8 ri
Slide 45: Growth Program: Rapid Manufacturing
Growth Program: Rapid Manufacturing > Hearing aids > Aerospace > Military » Orthodontics > Dental study models > Dental drill guides > Formula One/NASCAR > Automotive > Medical/prosthetics > Footwear » Tools and fixtures > Jewelry manufacturing
Slide 46: Rapid Manufacturing Growth Drivers
Rapid Manufacturing Growth Drivers (Based on $US) Global CAPEX Production Machinery $4.4 bition y fs fj $4.0ion Traditional y ‘Teseaesanal spa) [| Manufacturing 7 Ss Processes ~~ cNC= 1 ee > $15 Billion \ ~$4 Billion» g 3 x = XN a ; * Rani a “a 2005 2008 NY AS Source: 30 Systems and ARC Advisory Gro
Slide 47: Rapid Manufacturing Progress
Experience: Rapid Manufacturing Progress Customers’ Drivers > Beautiful feature definition Vv Absolutely fantastic accuracy » Superb surface quality » Big size ready-to-use parts Enabling Technology > Digital scanning system with Auto Focus » Precision recoating system Vv Manufacturing capable mater
Slide 48: Rapid Manufacturing: Larger
Rapid Manufacturing: Larger a c 5 ES 3 vu
Slide 49: Accurate
Accurate Bs = c EI ~~ ] £ 3 < cI = 2 a Co) aw)
Slide 50: Rapid Manufacturing: Durable
Rapid Manufacturing: Durable i: = val | oe. |
Slide 51: Rapid Manufacturing: End Use Parts
Rapid Manufacturing: End Use Parts Experience SvSTEMS
Slide 52: Example DuraForm EX
Example DuraForm® EX Outstanding Toughness @ cweromoex | Elongation at Break (%) Y PP + 20% Tale W ‘ss Se _Powprepyiene 0 Tensile Strength (MPa) Experience © Flex Strength (MPa)
Slide 53: Business Model Strengths
me differenc Experience Business Model Strengths Leading industry position through technology Energized, experienced team Clear priorities... customer-centric culture Stronger financial base and flexibility Significant performance improvement initiatives Healthy pipeline of new opportunities Focused
Slide 54: Searchable text section of graphics shown above
Searchable text section of graphics shown above 3D Systems Corporation 2007 Needham Conference January 10, 2006 [LOGO] NASDAQ: TDSC www.3dsystems.com Transform Your Products Forward-Looking Statements Certain statements made in this presentation that are not statements of historical or current facts