Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil EL&P Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries Fathom Digital Manufacturing Reports Second Quarter 2023 Financial Results By: Fathom Digital Manufacturing Corporation via Business Wire August 14, 2023 at 07:00 AM EDT Second Quarter 2023 Highlights Revenue totaled $34.5 million Total orders were $38.0 million Net loss totaled $(7.3) million; Adjusted net loss1 was $(5.7) million Adjusted EBITDA1 totaled $4.8 million, representing an Adjusted EBITDA margin1 of 14.0% First Half 2023 Highlights Revenue totaled $69.5 million Total orders were $72.6 million Net loss totaled $(8.6) million; adjusted net loss1 totaled $(11.2) million Adjusted EBITDA1 was $8.9 million, representing an Adjusted EBITDA margin1 of 12.8% Fathom Digital Manufacturing Corp. (NYSE: FATH), an industry leader in on-demand digital manufacturing services, today announced financial results for the second quarter and six months ended June 30, 2023. Three Months Ended Six Months Ended ($ in thousands) 6/30/2023 6/30/2022 6/30/2023 6/30/2022 Revenue $34,474 $41,985 $69,481 $82,526 Net income (loss) $(7,264) $34,284 $(8,595) $53,278 Adjusted net income (loss)1 $(5,669) $1,497 $(11,171) $696 Adjusted EBITDA1 $4,819 $8,973 $8,920 $14,846 Adjusted EBITDA margin1 14.0% 21.4% 12.8% 18.0% 1 See “Non-GAAP Financial Information.” Reconciliations of non-GAAP financial measures are included in the appendix. “Fathom’s results for the second quarter were consistent with our expectations as we continue to realize cost savings from our previously announced optimization plan, partially offsetting the impact of a challenging macro environment,” said Ryan Martin, Fathom Chief Executive Officer. “During the quarter, we grew order volumes approximately 10% on a sequential basis, increasing our backlog, and improved sequentially our Adjusted EBITDA and Adjusted EBITDA margin by 17.5% and 230 basis points, respectively. Our focus remains on fully leveraging our comprehensive capabilities to meet the high-mix, low-to-mid volume production needs of enterprise-level customers and driving profitable, long-term growth.” Summary of Financial Results Revenue for the second quarter of 2023 was $34.5 million compared to $42.0 million in the second quarter of 2022, a decrease of 17.9% primarily due to lower production volumes driven by the softer macroeconomic environment, primarily impacting Fathom’s production precision sheet metal product line. For the six months ended June 30, 2023, revenue totaled $69.5 million versus $82.5 million for the six months ended June 30, 2022. Gross profit for the second quarter of 2023 totaled $10.5 million, or 30.6% of revenue, compared to $15.5 million, or 37.0% of revenue, in the second quarter of 2022. Gross profit for the six months ended June 30, 2023 was $22.5 million, or 32.4% of revenue, compared to $27.5 million, or 33.4% of revenue, which includes approximately $3.2 million in non-cash purchase accounting adjustments, for the same period in 2022. Net loss for the second quarter of 2023 was $(7.3) million compared to net income of $34.3 million in the second quarter of 2022. Excluding the revaluation of Fathom warrants and earnout shares, stock compensation expense, optimization plan expenses, and other costs, Fathom reported an adjusted net loss in the second quarter of 2023 totaling $(5.7) million compared to adjusted net income of $1.5 million for the same period in 2022. Net loss for the six months ended June 30, 2023 was $(8.6) million compared to net income of $53.3 million for the same period in 2022. For the six months ended June 30, 2023, the adjusted net loss was $(11.2) million compared to adjusted net income of $0.7 million for the same period in 2022. Adjusted EBITDA for the second quarter of 2023 totaled $4.8 million versus $9.0 million for the same period in 2022 primarily due to lower volume leverage, partially offset by cost savings from the execution of Fathom’s optimization plan. The Adjusted EBITDA margin in the quarter was 14.0% compared to 21.4% in the second quarter of 2022. For the six months ended June 30, 2023, Adjusted EBITDA and Adjusted EBITDA margin were $8.9 million and 12.8%, respectively, compared to $14.8 million and 18.0%, respectively, for the same period in 2022. Conference Call Fathom will host a conference call on Monday, August 14, 2023 at 8:30 am Eastern Time to discuss the results for the second quarter 2023 and provide the company’s outlook for the third quarter 2023. The dial-in number for callers in the U.S. is +1-833-470-1428 and the dial-in number for international callers is +1-404-975-4839. The access code for all callers is 900561. The conference call will be broadcast live over the Internet and include a slide presentation. To access the webcast and supporting materials, please visit the investor relations section of Fathom’s website at https://investors.fathommfg.com. A replay of the conference call can be accessed through August 21, 2023, by dialing +1-866-813-9403 (US) or +1-929-458-6194 (international), and then entering the access code 173691. The webcast will also be archived on Fathom’s website. About Fathom Digital Manufacturing Fathom is one of the largest on-demand digital manufacturing platforms in North America, serving the comprehensive product development and low- to mid-volume manufacturing needs of some of the largest and most innovative companies in the world. With more than 25 quick turn manufacturing processes combined with an extensive national footprint, Fathom seamlessly blends in-house capabilities across plastic and metal additive technologies, CNC machining, injection molding and tooling, sheet metal fabrication, design and engineering, and more. Fathom has more than 35 years of industry experience and is at the forefront of the Industry 4.0 digital manufacturing revolution, serving clients in the technology, defense, aerospace, medical, automotive, IOT sectors, and others. Fathom's certifications include: ITAR Registered, ISO 9001:2015 Design Certified, ISO 9001:2015, ISO 13485:2016, AS9100:2016, and NIST 800-171. To learn more, visit https://fathommfg.com/. Forward-Looking Statements Certain statements made in this press release are “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Words such as “estimates,” “projects,” “expects,” “anticipates,” “forecasts,” “plans,” “intends,” “believes,” “seeks,” “may,” “will,” “would,” “should,” “future,” “propose,” “target,” “goal,” “objective,” “outlook” and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the control of Fathom Digital Manufacturing Corporation (“Fathom”) that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Important factors, among others, that may affect actual results or outcomes include: the inability to recognize the anticipated benefits of our business combination with Altimar Acquisition Corp. II; changes in general economic conditions, including as a result of the COVID-19 pandemic or any future outbreaks of other highly infectious or contagious disease; the implementation of our optimization plan could result in greater costs and fewer benefits than we anticipate; the outcome of litigation related to or arising out of the business combination, or any adverse developments therein or delays or costs resulting therefrom; the ability to meet the New York Stock Exchange’s listing standards following the consummation of the business combination; costs related to the business combination and additional factors discussed in Fathom’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the Securities and Exchange Commission (the “SEC”) on April 7, 2023, as amended on May 1, 2023, as well as Fathom’s other filings with the SEC. If any of the risks described above materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by our forward-looking statements. There may be additional risks that Fathom does not presently know or that Fathom currently believes are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect Fathom’s expectations, plans or forecasts of future events and views as of the date of this press release. These forward-looking statements should not be relied upon as representing Fathom’s assessments as of any date subsequent to the date of this press release. Accordingly, undue reliance should not be placed upon the forward-looking statements. Fathom undertakes no obligation to update or revise any forward-looking statements made by management or on its behalf whether as a result of future developments, subsequent events or circumstances or otherwise, except as required by law. Non-GAAP Financial Information This press release includes Adjusted Net Income, Adjusted EBITDA and Adjusted EBITDA margin, which are non-GAAP financial measures that we use to supplement our results presented in accordance with U.S. GAAP. We believe Adjusted Net Income, Adjusted EBITDA and Adjusted EBITDA margin are useful in evaluating our operating performance, as they are similar to measures reported by our public competitors and regularly used by security analysts, institutional investors and other interested parties in analyzing operating performance and prospects. Adjusted Net Income, Adjusted EBITDA and Adjusted EBITDA margin are not intended to be a substitute for any U.S. GAAP financial measure and, as calculated, may not be comparable to other similarly titled measures of performance of other companies in other industries or within the same industry. We define and calculate Adjusted Net Income as net income (loss) before the impact of any change in the estimated fair value of the company’s warrants or earnout shares, tax receivable agreement liability, optimization plan expenses, goodwill impairment, stock-based compensation, and certain other non-cash and non-core items, as described in the reconciliation included in the appendix to this press release. We define and calculate Adjusted EBITDA as net income (loss) before the impact of interest income or expense, income tax expense and depreciation and amortization, and further adjusted for the following items: change in the estimated fair value of the company’s warrants or earnout shares, tax receivable agreement liability, optimization plan expenses, goodwill impairment, stock-based compensation, and certain other non-cash and non-core items, as described in the reconciliation included in the appendix to this press release. Adjusted EBITDA excludes certain expenses that are required in accordance with U.S. GAAP because they are non-recurring (for example, in the case of optimization plan expenses), non-cash (for example, in the case of depreciation, amortization, goodwill impairment, and stock-based compensation) or are not related to our underlying business performance (for example, in the case of interest income and expense). Adjusted EBITDA margin represents Adjusted EBITDA divided by total revenue. We include these non-GAAP financial measures because they are used by management to evaluate Fathom’s core operating performance and trends and to make strategic decisions regarding the allocation of capital and new investments. Information reconciling forward-looking Adjusted EBITDA to GAAP financial measures is unavailable to Fathom without unreasonable effort. The company is not able to provide reconciliations of forward-looking Adjusted EBITDA to GAAP financial measures because certain items required for such reconciliations are outside of Fathom's control and/or cannot be reasonably predicted, such as the provision for income taxes. Preparation of such reconciliations would require a forward-looking balance sheet, statement of income and statement of cash flow, prepared in accordance with GAAP, and such forward-looking financial statements are unavailable to Fathom without unreasonable effort. Fathom provides a range for its Adjusted EBITDA forecast that it believes will be achieved, however it cannot accurately predict all the components of the Adjusted EBITDA calculation. Fathom provides an Adjusted EBITDA forecast because it believes that Adjusted EBITDA, when viewed with the company's results under GAAP, provides useful information for the reasons noted above. However, Adjusted EBITDA is not a measure of financial performance or liquidity under GAAP and, accordingly, should not be considered as an alternative to net income or cash flow from operating activities as an indicator of operating performance or liquidity. Consolidated Balance Sheets Period Ended June 30, 2023 (Unaudited) December 31, 2022 Assets Current assets Cash $ 10,733 $ 10,713 Accounts receivable, net 24,496 28,641 Inventory 17,177 15,718 Prepaid expenses and other current assets 2,618 3,588 Total current assets 55,024 58,660 Property and equipment, net 48,384 47,703 Right-of-use lease assets, net 12,034 12,565 Intangible assets, net 242,342 251,412 Other non-current assets 144 175 Total assets $ 357,928 $ 370,515 Liabilities and Shareholders’ Equity Current liabilities Accounts payable $ 10,311 $ 7,982 Accrued expenses 8,155 8,176 Current lease liability 2,233 2,374 Other current liabilities 3,478 4,828 Current portion of debt, net 49,167 42,744 Total current liabilities 73,344 66,104 Long-term debt, net 109,551 114,327 Fathom earnout shares liability 808 5,960 Sponsor earnout shares liability 137 930 Warrant liability 600 2,780 Payable to related parties pursuant to the tax receivable agreement (includes $4,050 and $4,000 at fair value, respectively) 28,263 25,360 Noncurrent lease liability 10,285 11,083 Total liabilities 222,988 226,544 Commitments and Contingencies: Contingently Redeemable Preferred Equity: Redeemable non-controlling interest in Fathom OpCo 80,059 92,207 Shareholders' Equity: Class A common stock, $0.0001 par value; 300,000,000 shares authorized; issued and outstanding 70,085,417 and 65,808,764 shares as of June 30, 2023 and December 31, 2022, respectively 7 7 Class B common stock, $0.0001 par value; 180,000,000 shares authorized; issued and outstanding 66,547,589 and 70,153,051 shares as of June 30, 2023 and December 31, 2022, respectively 7 7 Additional paid-in-capital 592,068 587,941 Accumulated other comprehensive loss (107 ) (107 ) Accumulated deficit (537,094 ) (536,084 ) Shareholders’ equity attributable to Fathom Digital Manufacturing Corporation 54,881 51,764 Total Liabilities, Shareholders’ Equity, and Redeemable Non-Controlling Interest $ 357,928 $ 370,515 Consolidated Statements of Comprehensive Income (Loss) Three Months Ended Six Months Ended June 30, 2023 June 30, 2022 June 30, 2023 June 30, 2022 Revenue $ 34,474 $ 41,985 $ 69,481 $ 82,526 Cost of revenue 23,940 26,437 47,002 54,981 Gross profit 10,534 15,548 22,479 27,545 Operating expenses Selling, general, and administrative 9,445 11,617 20,217 26,381 Depreciation and amortization 4,643 4,452 9,218 8,968 Restructuring 1,406 - 2,056 - Total operating expenses 15,494 16,069 31,491 35,349 Operating loss (4,960 ) (521 ) (9,012 ) (7,804 ) Interest expense and other (income) expense Interest expense 3,959 1,858 7,429 3,332 Other expense 65 129 138 195 Other income (1,784 ) (36,108 ) (8,103 ) (63,223 ) Total interest expense and other (income) expense, net 2,240 (34,121 ) (536 ) (59,696 ) Net income (loss) before income tax $ (7,200 ) $ 33,601 $ (8,476 ) $ 51,892 Income tax (benefit) expense 64 (683 ) 119 (1,386 ) Net income (loss) $ (7,264 ) $ 34,284 $ (8,595 ) $ 53,278 Weighted average Class A common shares outstanding Basic 69,703,407 52,259,885 68,382,896 51,530,961 Diluted 136,302,053 135,524,773 136,213,635 135,305,168 Q2 2023 Revenue by Product Line Three Months Ended ($ in thousands) 6/30/2023 % Revenue 6/30/2022 % Revenue % Change Revenue By Product Line Additive manufacturing $3,287 9.5% $4,410 10.5% -25.5% Injection molding $6,064 17.6% $7,093 16.9% -14.5% CNC machining $13,240 38.4% $14,584 34.7% -9.2% Precision sheet metal $10,164 29.5% $14,751 35.1% -31.1% Other revenue $1,719 5.0% $1,147 2.7% 49.9% Total $34,474 100.0% $41,985 100.0% -17.9% Six Months 2023 Revenue by Product Line Six Months Ended ($ in thousands) 6/30/2023 % Revenue 6/30/2022 % Revenue % Change Revenue By Product Line Additive manufacturing $6,875 9.9% $8,559 10.4% -19.7% Injection molding $10,743 15.5% $13,908 16.9% -22.8% CNC machining $27,470 39.5% $27,910 33.8% -1.6% Precision sheet metal $20,547 29.6% $29,434 35.7% -30.2% Other revenue $3,846 5.5% $2,715 3.3% 41.7% Total $69,481 100.0% $82,526 100.0% -15.8% Reconciliation of GAAP Net Income (Loss) to Adjusted Net Income (Loss) Three Months Ended Six Months Ended June 30, 2023 June 30, 2022 June 30, 2023 June 30, 2022 Net (loss) income $ (7,264) $ 34,284 $ (8,595) $ 53,278 Stock compensation 1,239 1,796 2,332 3,926 Inventory step-up amortization - - - 3,241 Restructuring expense 1,406 - 2,056 - Change in fair value of warrant liability(1) (400) (12,500) (2,180) (20,600) Change in fair value of earnout share liabilities(1) (1,115) (22,930) (5,945) (41,900) Change in fair value of tax receivable agreement(1) (250) (200) 50 (200) Integration, non-recurring, non-operating, cash, and non-cash costs(2) 715 1,047 1,111 2,951 Adjusted net loss $ (5,669) $ 1,497 $ (11,171) $ 696 1 Represents the impacts from the change in fair value related to the earnout shares liability, the warrant liability and the tax receivable agreement associated with the business combination completed on December 23, 2021; 2 Represents adjustments for other integration, non-recurring, non-operating, cash, and non-cash costs related primarily to integration costs for acquisitions and severance. Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA Three Months Ended Six Months Ended June 30, 2023 June 30, 2022 June 30, 2023 June 30, 2022 Net income (loss) $ (7,264) $ 34,284 $ (8,595) $ 53,278 Depreciation and amortization 6,465 5,996 12,543 12,204 Interest expense, net 3,959 1,858 7,429 3,332 Income tax expense (benefit) 64 (378) 119 (1,386) Stock compensation 1,239 1,796 2,332 3,926 Inventory step-up amortization - - - 3,241 Restructuring expense 1,406 - 2,056 - Change in fair value of warrant liability(1) (400) (12,500) (2,180) (20,600) Change in fair value of earnout shares liability(1) (1,115) (22,930) (5,945) (41,900) Change in fair value of tax receivable agreement(1) (250) (200) 50 (200) Integration, non-recurring, non-operating, cash, and non-cash costs(2) 715 1,047 1,111 2,951 Adjusted EBITDA $ 4,819 $ 8,973 $ 8,920 $ 14,846 1 Represents the impacts from the change in fair value related to the earnout shares liability, the warrant liability and the tax receivable agreement associated with the business combination completed on December 23, 2021; 2 Represents adjustments for other integration, non-recurring, non-operating, cash, and non-cash costs related primarily to integration costs for acquisitions and severance. View source version on businesswire.com: https://www.businesswire.com/news/home/20230813867621/en/Contacts Michael Cimini Director, Investor Relations Fathom Digital Manufacturing (262) 563-5575 michael.cimini@fathommfg.com Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
Fathom Digital Manufacturing Reports Second Quarter 2023 Financial Results By: Fathom Digital Manufacturing Corporation via Business Wire August 14, 2023 at 07:00 AM EDT Second Quarter 2023 Highlights Revenue totaled $34.5 million Total orders were $38.0 million Net loss totaled $(7.3) million; Adjusted net loss1 was $(5.7) million Adjusted EBITDA1 totaled $4.8 million, representing an Adjusted EBITDA margin1 of 14.0% First Half 2023 Highlights Revenue totaled $69.5 million Total orders were $72.6 million Net loss totaled $(8.6) million; adjusted net loss1 totaled $(11.2) million Adjusted EBITDA1 was $8.9 million, representing an Adjusted EBITDA margin1 of 12.8% Fathom Digital Manufacturing Corp. (NYSE: FATH), an industry leader in on-demand digital manufacturing services, today announced financial results for the second quarter and six months ended June 30, 2023. Three Months Ended Six Months Ended ($ in thousands) 6/30/2023 6/30/2022 6/30/2023 6/30/2022 Revenue $34,474 $41,985 $69,481 $82,526 Net income (loss) $(7,264) $34,284 $(8,595) $53,278 Adjusted net income (loss)1 $(5,669) $1,497 $(11,171) $696 Adjusted EBITDA1 $4,819 $8,973 $8,920 $14,846 Adjusted EBITDA margin1 14.0% 21.4% 12.8% 18.0% 1 See “Non-GAAP Financial Information.” Reconciliations of non-GAAP financial measures are included in the appendix. “Fathom’s results for the second quarter were consistent with our expectations as we continue to realize cost savings from our previously announced optimization plan, partially offsetting the impact of a challenging macro environment,” said Ryan Martin, Fathom Chief Executive Officer. “During the quarter, we grew order volumes approximately 10% on a sequential basis, increasing our backlog, and improved sequentially our Adjusted EBITDA and Adjusted EBITDA margin by 17.5% and 230 basis points, respectively. Our focus remains on fully leveraging our comprehensive capabilities to meet the high-mix, low-to-mid volume production needs of enterprise-level customers and driving profitable, long-term growth.” Summary of Financial Results Revenue for the second quarter of 2023 was $34.5 million compared to $42.0 million in the second quarter of 2022, a decrease of 17.9% primarily due to lower production volumes driven by the softer macroeconomic environment, primarily impacting Fathom’s production precision sheet metal product line. For the six months ended June 30, 2023, revenue totaled $69.5 million versus $82.5 million for the six months ended June 30, 2022. Gross profit for the second quarter of 2023 totaled $10.5 million, or 30.6% of revenue, compared to $15.5 million, or 37.0% of revenue, in the second quarter of 2022. Gross profit for the six months ended June 30, 2023 was $22.5 million, or 32.4% of revenue, compared to $27.5 million, or 33.4% of revenue, which includes approximately $3.2 million in non-cash purchase accounting adjustments, for the same period in 2022. Net loss for the second quarter of 2023 was $(7.3) million compared to net income of $34.3 million in the second quarter of 2022. Excluding the revaluation of Fathom warrants and earnout shares, stock compensation expense, optimization plan expenses, and other costs, Fathom reported an adjusted net loss in the second quarter of 2023 totaling $(5.7) million compared to adjusted net income of $1.5 million for the same period in 2022. Net loss for the six months ended June 30, 2023 was $(8.6) million compared to net income of $53.3 million for the same period in 2022. For the six months ended June 30, 2023, the adjusted net loss was $(11.2) million compared to adjusted net income of $0.7 million for the same period in 2022. Adjusted EBITDA for the second quarter of 2023 totaled $4.8 million versus $9.0 million for the same period in 2022 primarily due to lower volume leverage, partially offset by cost savings from the execution of Fathom’s optimization plan. The Adjusted EBITDA margin in the quarter was 14.0% compared to 21.4% in the second quarter of 2022. For the six months ended June 30, 2023, Adjusted EBITDA and Adjusted EBITDA margin were $8.9 million and 12.8%, respectively, compared to $14.8 million and 18.0%, respectively, for the same period in 2022. Conference Call Fathom will host a conference call on Monday, August 14, 2023 at 8:30 am Eastern Time to discuss the results for the second quarter 2023 and provide the company’s outlook for the third quarter 2023. The dial-in number for callers in the U.S. is +1-833-470-1428 and the dial-in number for international callers is +1-404-975-4839. The access code for all callers is 900561. The conference call will be broadcast live over the Internet and include a slide presentation. To access the webcast and supporting materials, please visit the investor relations section of Fathom’s website at https://investors.fathommfg.com. A replay of the conference call can be accessed through August 21, 2023, by dialing +1-866-813-9403 (US) or +1-929-458-6194 (international), and then entering the access code 173691. The webcast will also be archived on Fathom’s website. About Fathom Digital Manufacturing Fathom is one of the largest on-demand digital manufacturing platforms in North America, serving the comprehensive product development and low- to mid-volume manufacturing needs of some of the largest and most innovative companies in the world. With more than 25 quick turn manufacturing processes combined with an extensive national footprint, Fathom seamlessly blends in-house capabilities across plastic and metal additive technologies, CNC machining, injection molding and tooling, sheet metal fabrication, design and engineering, and more. Fathom has more than 35 years of industry experience and is at the forefront of the Industry 4.0 digital manufacturing revolution, serving clients in the technology, defense, aerospace, medical, automotive, IOT sectors, and others. Fathom's certifications include: ITAR Registered, ISO 9001:2015 Design Certified, ISO 9001:2015, ISO 13485:2016, AS9100:2016, and NIST 800-171. To learn more, visit https://fathommfg.com/. Forward-Looking Statements Certain statements made in this press release are “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Words such as “estimates,” “projects,” “expects,” “anticipates,” “forecasts,” “plans,” “intends,” “believes,” “seeks,” “may,” “will,” “would,” “should,” “future,” “propose,” “target,” “goal,” “objective,” “outlook” and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the control of Fathom Digital Manufacturing Corporation (“Fathom”) that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Important factors, among others, that may affect actual results or outcomes include: the inability to recognize the anticipated benefits of our business combination with Altimar Acquisition Corp. II; changes in general economic conditions, including as a result of the COVID-19 pandemic or any future outbreaks of other highly infectious or contagious disease; the implementation of our optimization plan could result in greater costs and fewer benefits than we anticipate; the outcome of litigation related to or arising out of the business combination, or any adverse developments therein or delays or costs resulting therefrom; the ability to meet the New York Stock Exchange’s listing standards following the consummation of the business combination; costs related to the business combination and additional factors discussed in Fathom’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the Securities and Exchange Commission (the “SEC”) on April 7, 2023, as amended on May 1, 2023, as well as Fathom’s other filings with the SEC. If any of the risks described above materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by our forward-looking statements. There may be additional risks that Fathom does not presently know or that Fathom currently believes are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect Fathom’s expectations, plans or forecasts of future events and views as of the date of this press release. These forward-looking statements should not be relied upon as representing Fathom’s assessments as of any date subsequent to the date of this press release. Accordingly, undue reliance should not be placed upon the forward-looking statements. Fathom undertakes no obligation to update or revise any forward-looking statements made by management or on its behalf whether as a result of future developments, subsequent events or circumstances or otherwise, except as required by law. Non-GAAP Financial Information This press release includes Adjusted Net Income, Adjusted EBITDA and Adjusted EBITDA margin, which are non-GAAP financial measures that we use to supplement our results presented in accordance with U.S. GAAP. We believe Adjusted Net Income, Adjusted EBITDA and Adjusted EBITDA margin are useful in evaluating our operating performance, as they are similar to measures reported by our public competitors and regularly used by security analysts, institutional investors and other interested parties in analyzing operating performance and prospects. Adjusted Net Income, Adjusted EBITDA and Adjusted EBITDA margin are not intended to be a substitute for any U.S. GAAP financial measure and, as calculated, may not be comparable to other similarly titled measures of performance of other companies in other industries or within the same industry. We define and calculate Adjusted Net Income as net income (loss) before the impact of any change in the estimated fair value of the company’s warrants or earnout shares, tax receivable agreement liability, optimization plan expenses, goodwill impairment, stock-based compensation, and certain other non-cash and non-core items, as described in the reconciliation included in the appendix to this press release. We define and calculate Adjusted EBITDA as net income (loss) before the impact of interest income or expense, income tax expense and depreciation and amortization, and further adjusted for the following items: change in the estimated fair value of the company’s warrants or earnout shares, tax receivable agreement liability, optimization plan expenses, goodwill impairment, stock-based compensation, and certain other non-cash and non-core items, as described in the reconciliation included in the appendix to this press release. Adjusted EBITDA excludes certain expenses that are required in accordance with U.S. GAAP because they are non-recurring (for example, in the case of optimization plan expenses), non-cash (for example, in the case of depreciation, amortization, goodwill impairment, and stock-based compensation) or are not related to our underlying business performance (for example, in the case of interest income and expense). Adjusted EBITDA margin represents Adjusted EBITDA divided by total revenue. We include these non-GAAP financial measures because they are used by management to evaluate Fathom’s core operating performance and trends and to make strategic decisions regarding the allocation of capital and new investments. Information reconciling forward-looking Adjusted EBITDA to GAAP financial measures is unavailable to Fathom without unreasonable effort. The company is not able to provide reconciliations of forward-looking Adjusted EBITDA to GAAP financial measures because certain items required for such reconciliations are outside of Fathom's control and/or cannot be reasonably predicted, such as the provision for income taxes. Preparation of such reconciliations would require a forward-looking balance sheet, statement of income and statement of cash flow, prepared in accordance with GAAP, and such forward-looking financial statements are unavailable to Fathom without unreasonable effort. Fathom provides a range for its Adjusted EBITDA forecast that it believes will be achieved, however it cannot accurately predict all the components of the Adjusted EBITDA calculation. Fathom provides an Adjusted EBITDA forecast because it believes that Adjusted EBITDA, when viewed with the company's results under GAAP, provides useful information for the reasons noted above. However, Adjusted EBITDA is not a measure of financial performance or liquidity under GAAP and, accordingly, should not be considered as an alternative to net income or cash flow from operating activities as an indicator of operating performance or liquidity. Consolidated Balance Sheets Period Ended June 30, 2023 (Unaudited) December 31, 2022 Assets Current assets Cash $ 10,733 $ 10,713 Accounts receivable, net 24,496 28,641 Inventory 17,177 15,718 Prepaid expenses and other current assets 2,618 3,588 Total current assets 55,024 58,660 Property and equipment, net 48,384 47,703 Right-of-use lease assets, net 12,034 12,565 Intangible assets, net 242,342 251,412 Other non-current assets 144 175 Total assets $ 357,928 $ 370,515 Liabilities and Shareholders’ Equity Current liabilities Accounts payable $ 10,311 $ 7,982 Accrued expenses 8,155 8,176 Current lease liability 2,233 2,374 Other current liabilities 3,478 4,828 Current portion of debt, net 49,167 42,744 Total current liabilities 73,344 66,104 Long-term debt, net 109,551 114,327 Fathom earnout shares liability 808 5,960 Sponsor earnout shares liability 137 930 Warrant liability 600 2,780 Payable to related parties pursuant to the tax receivable agreement (includes $4,050 and $4,000 at fair value, respectively) 28,263 25,360 Noncurrent lease liability 10,285 11,083 Total liabilities 222,988 226,544 Commitments and Contingencies: Contingently Redeemable Preferred Equity: Redeemable non-controlling interest in Fathom OpCo 80,059 92,207 Shareholders' Equity: Class A common stock, $0.0001 par value; 300,000,000 shares authorized; issued and outstanding 70,085,417 and 65,808,764 shares as of June 30, 2023 and December 31, 2022, respectively 7 7 Class B common stock, $0.0001 par value; 180,000,000 shares authorized; issued and outstanding 66,547,589 and 70,153,051 shares as of June 30, 2023 and December 31, 2022, respectively 7 7 Additional paid-in-capital 592,068 587,941 Accumulated other comprehensive loss (107 ) (107 ) Accumulated deficit (537,094 ) (536,084 ) Shareholders’ equity attributable to Fathom Digital Manufacturing Corporation 54,881 51,764 Total Liabilities, Shareholders’ Equity, and Redeemable Non-Controlling Interest $ 357,928 $ 370,515 Consolidated Statements of Comprehensive Income (Loss) Three Months Ended Six Months Ended June 30, 2023 June 30, 2022 June 30, 2023 June 30, 2022 Revenue $ 34,474 $ 41,985 $ 69,481 $ 82,526 Cost of revenue 23,940 26,437 47,002 54,981 Gross profit 10,534 15,548 22,479 27,545 Operating expenses Selling, general, and administrative 9,445 11,617 20,217 26,381 Depreciation and amortization 4,643 4,452 9,218 8,968 Restructuring 1,406 - 2,056 - Total operating expenses 15,494 16,069 31,491 35,349 Operating loss (4,960 ) (521 ) (9,012 ) (7,804 ) Interest expense and other (income) expense Interest expense 3,959 1,858 7,429 3,332 Other expense 65 129 138 195 Other income (1,784 ) (36,108 ) (8,103 ) (63,223 ) Total interest expense and other (income) expense, net 2,240 (34,121 ) (536 ) (59,696 ) Net income (loss) before income tax $ (7,200 ) $ 33,601 $ (8,476 ) $ 51,892 Income tax (benefit) expense 64 (683 ) 119 (1,386 ) Net income (loss) $ (7,264 ) $ 34,284 $ (8,595 ) $ 53,278 Weighted average Class A common shares outstanding Basic 69,703,407 52,259,885 68,382,896 51,530,961 Diluted 136,302,053 135,524,773 136,213,635 135,305,168 Q2 2023 Revenue by Product Line Three Months Ended ($ in thousands) 6/30/2023 % Revenue 6/30/2022 % Revenue % Change Revenue By Product Line Additive manufacturing $3,287 9.5% $4,410 10.5% -25.5% Injection molding $6,064 17.6% $7,093 16.9% -14.5% CNC machining $13,240 38.4% $14,584 34.7% -9.2% Precision sheet metal $10,164 29.5% $14,751 35.1% -31.1% Other revenue $1,719 5.0% $1,147 2.7% 49.9% Total $34,474 100.0% $41,985 100.0% -17.9% Six Months 2023 Revenue by Product Line Six Months Ended ($ in thousands) 6/30/2023 % Revenue 6/30/2022 % Revenue % Change Revenue By Product Line Additive manufacturing $6,875 9.9% $8,559 10.4% -19.7% Injection molding $10,743 15.5% $13,908 16.9% -22.8% CNC machining $27,470 39.5% $27,910 33.8% -1.6% Precision sheet metal $20,547 29.6% $29,434 35.7% -30.2% Other revenue $3,846 5.5% $2,715 3.3% 41.7% Total $69,481 100.0% $82,526 100.0% -15.8% Reconciliation of GAAP Net Income (Loss) to Adjusted Net Income (Loss) Three Months Ended Six Months Ended June 30, 2023 June 30, 2022 June 30, 2023 June 30, 2022 Net (loss) income $ (7,264) $ 34,284 $ (8,595) $ 53,278 Stock compensation 1,239 1,796 2,332 3,926 Inventory step-up amortization - - - 3,241 Restructuring expense 1,406 - 2,056 - Change in fair value of warrant liability(1) (400) (12,500) (2,180) (20,600) Change in fair value of earnout share liabilities(1) (1,115) (22,930) (5,945) (41,900) Change in fair value of tax receivable agreement(1) (250) (200) 50 (200) Integration, non-recurring, non-operating, cash, and non-cash costs(2) 715 1,047 1,111 2,951 Adjusted net loss $ (5,669) $ 1,497 $ (11,171) $ 696 1 Represents the impacts from the change in fair value related to the earnout shares liability, the warrant liability and the tax receivable agreement associated with the business combination completed on December 23, 2021; 2 Represents adjustments for other integration, non-recurring, non-operating, cash, and non-cash costs related primarily to integration costs for acquisitions and severance. Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA Three Months Ended Six Months Ended June 30, 2023 June 30, 2022 June 30, 2023 June 30, 2022 Net income (loss) $ (7,264) $ 34,284 $ (8,595) $ 53,278 Depreciation and amortization 6,465 5,996 12,543 12,204 Interest expense, net 3,959 1,858 7,429 3,332 Income tax expense (benefit) 64 (378) 119 (1,386) Stock compensation 1,239 1,796 2,332 3,926 Inventory step-up amortization - - - 3,241 Restructuring expense 1,406 - 2,056 - Change in fair value of warrant liability(1) (400) (12,500) (2,180) (20,600) Change in fair value of earnout shares liability(1) (1,115) (22,930) (5,945) (41,900) Change in fair value of tax receivable agreement(1) (250) (200) 50 (200) Integration, non-recurring, non-operating, cash, and non-cash costs(2) 715 1,047 1,111 2,951 Adjusted EBITDA $ 4,819 $ 8,973 $ 8,920 $ 14,846 1 Represents the impacts from the change in fair value related to the earnout shares liability, the warrant liability and the tax receivable agreement associated with the business combination completed on December 23, 2021; 2 Represents adjustments for other integration, non-recurring, non-operating, cash, and non-cash costs related primarily to integration costs for acquisitions and severance. View source version on businesswire.com: https://www.businesswire.com/news/home/20230813867621/en/Contacts Michael Cimini Director, Investor Relations Fathom Digital Manufacturing (262) 563-5575 michael.cimini@fathommfg.com
Second Quarter 2023 Highlights Revenue totaled $34.5 million Total orders were $38.0 million Net loss totaled $(7.3) million; Adjusted net loss1 was $(5.7) million Adjusted EBITDA1 totaled $4.8 million, representing an Adjusted EBITDA margin1 of 14.0% First Half 2023 Highlights Revenue totaled $69.5 million Total orders were $72.6 million Net loss totaled $(8.6) million; adjusted net loss1 totaled $(11.2) million Adjusted EBITDA1 was $8.9 million, representing an Adjusted EBITDA margin1 of 12.8%
Fathom Digital Manufacturing Corp. (NYSE: FATH), an industry leader in on-demand digital manufacturing services, today announced financial results for the second quarter and six months ended June 30, 2023. Three Months Ended Six Months Ended ($ in thousands) 6/30/2023 6/30/2022 6/30/2023 6/30/2022 Revenue $34,474 $41,985 $69,481 $82,526 Net income (loss) $(7,264) $34,284 $(8,595) $53,278 Adjusted net income (loss)1 $(5,669) $1,497 $(11,171) $696 Adjusted EBITDA1 $4,819 $8,973 $8,920 $14,846 Adjusted EBITDA margin1 14.0% 21.4% 12.8% 18.0% 1 See “Non-GAAP Financial Information.” Reconciliations of non-GAAP financial measures are included in the appendix. “Fathom’s results for the second quarter were consistent with our expectations as we continue to realize cost savings from our previously announced optimization plan, partially offsetting the impact of a challenging macro environment,” said Ryan Martin, Fathom Chief Executive Officer. “During the quarter, we grew order volumes approximately 10% on a sequential basis, increasing our backlog, and improved sequentially our Adjusted EBITDA and Adjusted EBITDA margin by 17.5% and 230 basis points, respectively. Our focus remains on fully leveraging our comprehensive capabilities to meet the high-mix, low-to-mid volume production needs of enterprise-level customers and driving profitable, long-term growth.” Summary of Financial Results Revenue for the second quarter of 2023 was $34.5 million compared to $42.0 million in the second quarter of 2022, a decrease of 17.9% primarily due to lower production volumes driven by the softer macroeconomic environment, primarily impacting Fathom’s production precision sheet metal product line. For the six months ended June 30, 2023, revenue totaled $69.5 million versus $82.5 million for the six months ended June 30, 2022. Gross profit for the second quarter of 2023 totaled $10.5 million, or 30.6% of revenue, compared to $15.5 million, or 37.0% of revenue, in the second quarter of 2022. Gross profit for the six months ended June 30, 2023 was $22.5 million, or 32.4% of revenue, compared to $27.5 million, or 33.4% of revenue, which includes approximately $3.2 million in non-cash purchase accounting adjustments, for the same period in 2022. Net loss for the second quarter of 2023 was $(7.3) million compared to net income of $34.3 million in the second quarter of 2022. Excluding the revaluation of Fathom warrants and earnout shares, stock compensation expense, optimization plan expenses, and other costs, Fathom reported an adjusted net loss in the second quarter of 2023 totaling $(5.7) million compared to adjusted net income of $1.5 million for the same period in 2022. Net loss for the six months ended June 30, 2023 was $(8.6) million compared to net income of $53.3 million for the same period in 2022. For the six months ended June 30, 2023, the adjusted net loss was $(11.2) million compared to adjusted net income of $0.7 million for the same period in 2022. Adjusted EBITDA for the second quarter of 2023 totaled $4.8 million versus $9.0 million for the same period in 2022 primarily due to lower volume leverage, partially offset by cost savings from the execution of Fathom’s optimization plan. The Adjusted EBITDA margin in the quarter was 14.0% compared to 21.4% in the second quarter of 2022. For the six months ended June 30, 2023, Adjusted EBITDA and Adjusted EBITDA margin were $8.9 million and 12.8%, respectively, compared to $14.8 million and 18.0%, respectively, for the same period in 2022. Conference Call Fathom will host a conference call on Monday, August 14, 2023 at 8:30 am Eastern Time to discuss the results for the second quarter 2023 and provide the company’s outlook for the third quarter 2023. The dial-in number for callers in the U.S. is +1-833-470-1428 and the dial-in number for international callers is +1-404-975-4839. The access code for all callers is 900561. The conference call will be broadcast live over the Internet and include a slide presentation. To access the webcast and supporting materials, please visit the investor relations section of Fathom’s website at https://investors.fathommfg.com. A replay of the conference call can be accessed through August 21, 2023, by dialing +1-866-813-9403 (US) or +1-929-458-6194 (international), and then entering the access code 173691. The webcast will also be archived on Fathom’s website. About Fathom Digital Manufacturing Fathom is one of the largest on-demand digital manufacturing platforms in North America, serving the comprehensive product development and low- to mid-volume manufacturing needs of some of the largest and most innovative companies in the world. With more than 25 quick turn manufacturing processes combined with an extensive national footprint, Fathom seamlessly blends in-house capabilities across plastic and metal additive technologies, CNC machining, injection molding and tooling, sheet metal fabrication, design and engineering, and more. Fathom has more than 35 years of industry experience and is at the forefront of the Industry 4.0 digital manufacturing revolution, serving clients in the technology, defense, aerospace, medical, automotive, IOT sectors, and others. Fathom's certifications include: ITAR Registered, ISO 9001:2015 Design Certified, ISO 9001:2015, ISO 13485:2016, AS9100:2016, and NIST 800-171. To learn more, visit https://fathommfg.com/. Forward-Looking Statements Certain statements made in this press release are “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Words such as “estimates,” “projects,” “expects,” “anticipates,” “forecasts,” “plans,” “intends,” “believes,” “seeks,” “may,” “will,” “would,” “should,” “future,” “propose,” “target,” “goal,” “objective,” “outlook” and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the control of Fathom Digital Manufacturing Corporation (“Fathom”) that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Important factors, among others, that may affect actual results or outcomes include: the inability to recognize the anticipated benefits of our business combination with Altimar Acquisition Corp. II; changes in general economic conditions, including as a result of the COVID-19 pandemic or any future outbreaks of other highly infectious or contagious disease; the implementation of our optimization plan could result in greater costs and fewer benefits than we anticipate; the outcome of litigation related to or arising out of the business combination, or any adverse developments therein or delays or costs resulting therefrom; the ability to meet the New York Stock Exchange’s listing standards following the consummation of the business combination; costs related to the business combination and additional factors discussed in Fathom’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the Securities and Exchange Commission (the “SEC”) on April 7, 2023, as amended on May 1, 2023, as well as Fathom’s other filings with the SEC. If any of the risks described above materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by our forward-looking statements. There may be additional risks that Fathom does not presently know or that Fathom currently believes are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect Fathom’s expectations, plans or forecasts of future events and views as of the date of this press release. These forward-looking statements should not be relied upon as representing Fathom’s assessments as of any date subsequent to the date of this press release. Accordingly, undue reliance should not be placed upon the forward-looking statements. Fathom undertakes no obligation to update or revise any forward-looking statements made by management or on its behalf whether as a result of future developments, subsequent events or circumstances or otherwise, except as required by law. Non-GAAP Financial Information This press release includes Adjusted Net Income, Adjusted EBITDA and Adjusted EBITDA margin, which are non-GAAP financial measures that we use to supplement our results presented in accordance with U.S. GAAP. We believe Adjusted Net Income, Adjusted EBITDA and Adjusted EBITDA margin are useful in evaluating our operating performance, as they are similar to measures reported by our public competitors and regularly used by security analysts, institutional investors and other interested parties in analyzing operating performance and prospects. Adjusted Net Income, Adjusted EBITDA and Adjusted EBITDA margin are not intended to be a substitute for any U.S. GAAP financial measure and, as calculated, may not be comparable to other similarly titled measures of performance of other companies in other industries or within the same industry. We define and calculate Adjusted Net Income as net income (loss) before the impact of any change in the estimated fair value of the company’s warrants or earnout shares, tax receivable agreement liability, optimization plan expenses, goodwill impairment, stock-based compensation, and certain other non-cash and non-core items, as described in the reconciliation included in the appendix to this press release. We define and calculate Adjusted EBITDA as net income (loss) before the impact of interest income or expense, income tax expense and depreciation and amortization, and further adjusted for the following items: change in the estimated fair value of the company’s warrants or earnout shares, tax receivable agreement liability, optimization plan expenses, goodwill impairment, stock-based compensation, and certain other non-cash and non-core items, as described in the reconciliation included in the appendix to this press release. Adjusted EBITDA excludes certain expenses that are required in accordance with U.S. GAAP because they are non-recurring (for example, in the case of optimization plan expenses), non-cash (for example, in the case of depreciation, amortization, goodwill impairment, and stock-based compensation) or are not related to our underlying business performance (for example, in the case of interest income and expense). Adjusted EBITDA margin represents Adjusted EBITDA divided by total revenue. We include these non-GAAP financial measures because they are used by management to evaluate Fathom’s core operating performance and trends and to make strategic decisions regarding the allocation of capital and new investments. Information reconciling forward-looking Adjusted EBITDA to GAAP financial measures is unavailable to Fathom without unreasonable effort. The company is not able to provide reconciliations of forward-looking Adjusted EBITDA to GAAP financial measures because certain items required for such reconciliations are outside of Fathom's control and/or cannot be reasonably predicted, such as the provision for income taxes. Preparation of such reconciliations would require a forward-looking balance sheet, statement of income and statement of cash flow, prepared in accordance with GAAP, and such forward-looking financial statements are unavailable to Fathom without unreasonable effort. Fathom provides a range for its Adjusted EBITDA forecast that it believes will be achieved, however it cannot accurately predict all the components of the Adjusted EBITDA calculation. Fathom provides an Adjusted EBITDA forecast because it believes that Adjusted EBITDA, when viewed with the company's results under GAAP, provides useful information for the reasons noted above. However, Adjusted EBITDA is not a measure of financial performance or liquidity under GAAP and, accordingly, should not be considered as an alternative to net income or cash flow from operating activities as an indicator of operating performance or liquidity. Consolidated Balance Sheets Period Ended June 30, 2023 (Unaudited) December 31, 2022 Assets Current assets Cash $ 10,733 $ 10,713 Accounts receivable, net 24,496 28,641 Inventory 17,177 15,718 Prepaid expenses and other current assets 2,618 3,588 Total current assets 55,024 58,660 Property and equipment, net 48,384 47,703 Right-of-use lease assets, net 12,034 12,565 Intangible assets, net 242,342 251,412 Other non-current assets 144 175 Total assets $ 357,928 $ 370,515 Liabilities and Shareholders’ Equity Current liabilities Accounts payable $ 10,311 $ 7,982 Accrued expenses 8,155 8,176 Current lease liability 2,233 2,374 Other current liabilities 3,478 4,828 Current portion of debt, net 49,167 42,744 Total current liabilities 73,344 66,104 Long-term debt, net 109,551 114,327 Fathom earnout shares liability 808 5,960 Sponsor earnout shares liability 137 930 Warrant liability 600 2,780 Payable to related parties pursuant to the tax receivable agreement (includes $4,050 and $4,000 at fair value, respectively) 28,263 25,360 Noncurrent lease liability 10,285 11,083 Total liabilities 222,988 226,544 Commitments and Contingencies: Contingently Redeemable Preferred Equity: Redeemable non-controlling interest in Fathom OpCo 80,059 92,207 Shareholders' Equity: Class A common stock, $0.0001 par value; 300,000,000 shares authorized; issued and outstanding 70,085,417 and 65,808,764 shares as of June 30, 2023 and December 31, 2022, respectively 7 7 Class B common stock, $0.0001 par value; 180,000,000 shares authorized; issued and outstanding 66,547,589 and 70,153,051 shares as of June 30, 2023 and December 31, 2022, respectively 7 7 Additional paid-in-capital 592,068 587,941 Accumulated other comprehensive loss (107 ) (107 ) Accumulated deficit (537,094 ) (536,084 ) Shareholders’ equity attributable to Fathom Digital Manufacturing Corporation 54,881 51,764 Total Liabilities, Shareholders’ Equity, and Redeemable Non-Controlling Interest $ 357,928 $ 370,515 Consolidated Statements of Comprehensive Income (Loss) Three Months Ended Six Months Ended June 30, 2023 June 30, 2022 June 30, 2023 June 30, 2022 Revenue $ 34,474 $ 41,985 $ 69,481 $ 82,526 Cost of revenue 23,940 26,437 47,002 54,981 Gross profit 10,534 15,548 22,479 27,545 Operating expenses Selling, general, and administrative 9,445 11,617 20,217 26,381 Depreciation and amortization 4,643 4,452 9,218 8,968 Restructuring 1,406 - 2,056 - Total operating expenses 15,494 16,069 31,491 35,349 Operating loss (4,960 ) (521 ) (9,012 ) (7,804 ) Interest expense and other (income) expense Interest expense 3,959 1,858 7,429 3,332 Other expense 65 129 138 195 Other income (1,784 ) (36,108 ) (8,103 ) (63,223 ) Total interest expense and other (income) expense, net 2,240 (34,121 ) (536 ) (59,696 ) Net income (loss) before income tax $ (7,200 ) $ 33,601 $ (8,476 ) $ 51,892 Income tax (benefit) expense 64 (683 ) 119 (1,386 ) Net income (loss) $ (7,264 ) $ 34,284 $ (8,595 ) $ 53,278 Weighted average Class A common shares outstanding Basic 69,703,407 52,259,885 68,382,896 51,530,961 Diluted 136,302,053 135,524,773 136,213,635 135,305,168 Q2 2023 Revenue by Product Line Three Months Ended ($ in thousands) 6/30/2023 % Revenue 6/30/2022 % Revenue % Change Revenue By Product Line Additive manufacturing $3,287 9.5% $4,410 10.5% -25.5% Injection molding $6,064 17.6% $7,093 16.9% -14.5% CNC machining $13,240 38.4% $14,584 34.7% -9.2% Precision sheet metal $10,164 29.5% $14,751 35.1% -31.1% Other revenue $1,719 5.0% $1,147 2.7% 49.9% Total $34,474 100.0% $41,985 100.0% -17.9% Six Months 2023 Revenue by Product Line Six Months Ended ($ in thousands) 6/30/2023 % Revenue 6/30/2022 % Revenue % Change Revenue By Product Line Additive manufacturing $6,875 9.9% $8,559 10.4% -19.7% Injection molding $10,743 15.5% $13,908 16.9% -22.8% CNC machining $27,470 39.5% $27,910 33.8% -1.6% Precision sheet metal $20,547 29.6% $29,434 35.7% -30.2% Other revenue $3,846 5.5% $2,715 3.3% 41.7% Total $69,481 100.0% $82,526 100.0% -15.8% Reconciliation of GAAP Net Income (Loss) to Adjusted Net Income (Loss) Three Months Ended Six Months Ended June 30, 2023 June 30, 2022 June 30, 2023 June 30, 2022 Net (loss) income $ (7,264) $ 34,284 $ (8,595) $ 53,278 Stock compensation 1,239 1,796 2,332 3,926 Inventory step-up amortization - - - 3,241 Restructuring expense 1,406 - 2,056 - Change in fair value of warrant liability(1) (400) (12,500) (2,180) (20,600) Change in fair value of earnout share liabilities(1) (1,115) (22,930) (5,945) (41,900) Change in fair value of tax receivable agreement(1) (250) (200) 50 (200) Integration, non-recurring, non-operating, cash, and non-cash costs(2) 715 1,047 1,111 2,951 Adjusted net loss $ (5,669) $ 1,497 $ (11,171) $ 696 1 Represents the impacts from the change in fair value related to the earnout shares liability, the warrant liability and the tax receivable agreement associated with the business combination completed on December 23, 2021; 2 Represents adjustments for other integration, non-recurring, non-operating, cash, and non-cash costs related primarily to integration costs for acquisitions and severance. Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA Three Months Ended Six Months Ended June 30, 2023 June 30, 2022 June 30, 2023 June 30, 2022 Net income (loss) $ (7,264) $ 34,284 $ (8,595) $ 53,278 Depreciation and amortization 6,465 5,996 12,543 12,204 Interest expense, net 3,959 1,858 7,429 3,332 Income tax expense (benefit) 64 (378) 119 (1,386) Stock compensation 1,239 1,796 2,332 3,926 Inventory step-up amortization - - - 3,241 Restructuring expense 1,406 - 2,056 - Change in fair value of warrant liability(1) (400) (12,500) (2,180) (20,600) Change in fair value of earnout shares liability(1) (1,115) (22,930) (5,945) (41,900) Change in fair value of tax receivable agreement(1) (250) (200) 50 (200) Integration, non-recurring, non-operating, cash, and non-cash costs(2) 715 1,047 1,111 2,951 Adjusted EBITDA $ 4,819 $ 8,973 $ 8,920 $ 14,846 1 Represents the impacts from the change in fair value related to the earnout shares liability, the warrant liability and the tax receivable agreement associated with the business combination completed on December 23, 2021; 2 Represents adjustments for other integration, non-recurring, non-operating, cash, and non-cash costs related primarily to integration costs for acquisitions and severance. View source version on businesswire.com: https://www.businesswire.com/news/home/20230813867621/en/
Michael Cimini Director, Investor Relations Fathom Digital Manufacturing (262) 563-5575 michael.cimini@fathommfg.com