Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
I heard it as 50% yearly over the past 4 years but could be wrong
I don't recall any mention of price except that when asked about supply for raw titanium and price he said they had good relationships with I think about 10 suppliers and regarding price he said it was a commodity and like any other goes up and down and they adjust their prices in line with those fluctuations. But I don't recall hearing any numbers. Email Jacque of ap&c maybe and see if he will give an answer.
Happy to share something of content after benefiting from all of yours and monkey's analysis as well as others. Happy also to try to answer questions.
[/img]Investor Day Report
Hi Friends,
The investor day was great, very interesting to hear everything presented and see things on the ground a little bit. Overall it only reaffirmed my feelings that there is an amazing long term growth story here.
The day started off strong with Swedish pastries, mini-sandwiches and espresso. Plus they had Arcam EBM key chain giveaways, sweet.
The format was a power point by Magnes, then by Rob the head of Disanto, and then the guy in charge of AP&C, with questions after each presenter. Then the Swedish ambassador spoke and cut a ribbon in front of 3 Q10’s, then informal chatting – I hung around listening to Magnes and Rob of Disanto.
I’ll give bullet points from each of the presentations/question sessions of things that I found interesting:
Magnes on Disanto/Orthopedics:
• Reason for acquisition of Disanto is it allows them to grow faster in realm of ortho implants – Disanto is very established with long time customer base
• Performance of parts main reason companies go with Arcam in ortho realm
• Main competition here is with traditional manufacturing (I found that interesting)
• Don’t look quarter to quarter
• In orthopedics in general there is strong consolidation with a few big players and many small players. Arcam is focusing on the small players (I think because they can produce parts those companies don’t have capacity to produce otherwise). Example - LIMA has 8 systems for building medical implants
• I wasn’t impressed when Magnes said spinal implants was big part of Disanto business but then looked to Rob and said, “right?” a bit unsure. Also later in small gropu couldn’t fully answer a technical question. I guess he can’t do everything!
Magnes on Aerospace:
• More cases in this realm where EBM is advantageous for cost reasons
• In engines performance is more the reason, but rest of plane is about cost savings
• Aerospace potential is huge, 10x bigger than orthopedics
• Process of getting to point of approval for production of parts is very complicated and long (so is orthopedics but way more for aerospace)
Magnes Q&A
• Each machine on average 5.4 million Swedish or about $800k (averaging types of EBM machines
• Ahead or behind on production of machines for demand – a bit behind on q20’s, sounds like big demand
• In answer to a question about Stryker and Synthesis (?) as competitors he said they are clients not competitors, but then backtracked saying he wasn’t allowed to say that, “let’s say they are potential clients”
• Questions about Fast EBM – haven’t guided for it. Will be available “sometime” with a little smile. I took that to mean fairly soon but who knows.
• I asked about patent strength, he said it’s very good, they have 37 patents I think he said. Best sign of that he said is no lawsuits. Many patents don’t mature for 10 years, and no important expirations anytime soon.
• What about issue of new machines and companies with older ones – investors are concerned about this for some reason but the companies aren’t. Basically don’t worry about it.
Rob of Disanto:
• Vet implants are a huge market believe it or not, hip and knees for dogs. No one else doing additive here
• Disanto has 58 non-EBM machines, 4 EBM.
• How many EBM machines do they anticipate? He can’t answer. How many can the new part of the building we are in hold? 40. “We plan to fill it all up in future with machines” Are we talking 2 years or 5? “won’t be very long.” Will be mainly Q10’S but maybe a few Q20’s.
• Arcam bought Disanto for good customer base
• Disanto doesn’t design or market, a company like JNJ comes to them with an order (he mentioned JNJ as example 3 times).
• Seeing a lot of traction for VBR spinal implants out of titanium big interest, Europe doesn’t want to use current material Peek anymore, with EBM you can produce that part in titanium now.
AP&C:
• 150 tons capacity a year
• Growing 50% over last 4 years
• In development: niobium, molybdenum, tantalum, zirconium, 2-5 years from now new metal powders available
• They can atomize what other companies can’t because of high temp.
• They use a different type of reactor (what makes the powder) thatn EIGA reactors that the other main competitors use
• Asked about capacity – not worried about capacity, they can make another reactor in 6 months if they need. They have 3 now
• Aerospace companies are very happy about Arcam acquiring AP&C
• Has big aerospace company client in Montreal (I think that’s what he said)
• Their AS certification of their powder is very important as key aerospace companies getting ready to go into production
• 50% R&D with aerospace, big volume ahead
That’s pretty much all my notes. In a small conversation afterwards Magnes said that Arcam is in it’s infancy in an industry that is in its infancy.
My overall takeaway: This gathering only reaffirmed my sense this is a rock solid investment opportunity. I mean you never know, but everything looks really really good to me. Arcam is expanding rapidly, aerospace is about to take off and companies have strong interest in Arcam. They will be a part of this growth story one way or another, and it looks like a massive growth story. And Arcam has a wide customer base globally. Rob joked that as soon as Obama mentioned 3d as the future China started to buy like crazy.
In orthopedics Disanto is going to grow quick, and Rob in small chats was clearly genuine in his statements that is quicker and cheaper, and Disanto has very long established relationships with many many companies. It will speed the adoption. Plus people don’t have to man the machines much.
And AP&C as it’s own company is very strong, will continue to sell to other additive companies in addition to Arcam, but the acquisition ensures high quality powder for Arcam and its customers.
Relative to the massive growth potential here it seems to me the risk is very low. I bought more today. Don’t know what the ups and downs are about but I’m looking long term, and trying to use these opportunities to lower my cost basis.
I wish I could figure out to attach the picture of myself holding an EBM produced skull part on my head….
I don't think that statement or anything at investor day was part of dip. Was all good there to my ears. I will give a full report later if my kid ever goes to sleep
At Disanto, just said hi to Magnus, excited.
Can anyone explain more the significance of this usage if EBM?
Yes with most brokers there is an added fee. With Fidelity the fee is dependent on how much you are buying or selling, namely higher if trading more. I have been using Etrade instead for arcam lately because they don't seem to have the added fee unless I am missing something.
I'd get back in if I were you! Maybe some for long term and some for trading?
Driveable for me thankfully. If you don't go and have questions to ask let me know
Anyone going to the Disanto/arcam presentation in November? I plan to, excited to see the factory and machines and hear from Magnus in person
Thank you monkey and investorhub for doing the homework! Much appreciated you keeping us on top of things, haven't had as much time lately.
Tried to add yesterday on the dip but priced my limit a tad to low. Oh well.
Hi All,
I emailed Magnus a while back to get his response about that article questioning long term profitability of the powder aspect of the business. Thought you might like to see his response below.
Aaron,
Sorry, this ended up in the bottom of the mail box.
Anyway, I assume you refer to the part of the text I copied in below.
Then, I would like to explain on powders;
1) We do not operate a razor – razorblade business. We sell powders but with rather
limited mark up. This actually differentiates us from for example 3DS and EOS who
both take significant part of the profits from materials.
We provide the materials more as a service.
2) The reason we acquired APC was that we want to secure availability of high quality
powder at reasonable cost. We see this as key to grow our machine business.
3) We also believe, as the article says, that with higher volumes more material
will be sourced from third parties.
Hope this helps
Best regards
Magnus
Magnus René
President & CEO
Arcam
Mobile: +46 702 79 89 99
magnus.rene@arcam.com
"For instance, instead of buying metal powder from metal 3-D printing companies at a substantial markup, General Electric goes direct to the mills that supply the industry with the material. This approach effectively breaks the razor-and-blade model that 3D Systems and Arcam have built around their metal 3-D printing businesses and could set a precedent for other industrial 3-D printing customers to follow. Those recurring revenue streams that are generated from consuming materials could become threatened over the long term as the industry continues growing and material costs become a greater focus."
Från: Aaron
Skickat: den 30 juni 2014 21:28
Till: Magnus René
Ämne: Question regarding metal powder future
Dear Magnus,
I have invested in Arcam the last couple of years and admire your leadership.
Today an article questioned the long term profitability of the metal powder aspect of your business due to GE and others potentially sourcing from elsewhere in the future. I would love to hear if you think the analysis is correct or not.
The article is here is you would like to see: http://www.dailyfinance.com/2014/06/30/what-3-d-printing-companies-dont-want-you-to-know/
Best regards,
Aaron
Sent from my iPhone
"The work to industrialize our technology with the major players within the aerospace and implant industries continue and we can now see good opportunities for volume orders during the year."
I like the sound of that. The last report was much vaguer about timing
Thanks!
Next earnings this friday I believe. Thoughts? Anyone been tallying orders this quarter ?
Up almost 7% in stockholm. Awesome climb back from the deep valley recently
I emailed Magnus and he said he will reply when he is back in the office next week. Still amazing to me he responds to inquiries like that personally
Interesting article, thoughts? I would love to hear what Magnes would reply about this issue
http://www.dailyfinance.com/2014/06/30/what-3-d-printing-companies-dont-want-you-to-know/
Jeffries covers arcam starts at buy
http://www.wkrb13.com/markets/325587/arcam-ab-receives-new-coverage-from-analysts-at-jefferies-group-amavf/
"The $70-million center will open in late 2015 and create more than 80 jobs. "
How much ahead of time do u think they order the machines?
Really great news to have confirmation ebm will be part of GE mix going forward. Hopefully will be a good number of machines. Bulk order and the stocks gonna pop big
Welcome aboard!
Nice find
At some point I want to try to go visit Disanto and see the machines in person since they are in ct. If I do I will let you know what I find.
Sounded from the conference call like they are really partnering
Yes I emailed the head of interactive machines many months back and he said it wasn't happening. Can try to find the old email for details
Holy moly It's hard to watch this endless pullback. Been just holding since I am in long but this is rough. If wasn't in so deep would be adding a lot at these prices but made mistake of buying back in full around split with positive fastebm news...so just watching and telling myself in a year all will be well. But this is rough.
Others who didn't sell high? Just holding and waiting?
Why is the stock down after a new order? Usually seems to be the case but with a spike beforehand from people who know earlier than us. No spike this time.
Added a bit too. Wish I hadn't loaded a lot more around the split but always easy in hindsight. I think sooner or later by end of year as good news rolls in it will climb again
Was interesting, seemed like was part just his personality is to not get excited, and also he didn't want to give forward looking statements with so much unknown. Also seemed like there genuinely was a lot that he couldn't predict timing wise.
Seems like all the ducks are in order for great continued growth to me, exact timing not so important, big things in works. I liked hearing they are expanding again their building I think he said this year
I also wasn't able to be on the call this
am but just found it is available to listen to on their site if you "register"
for the call. I look forward to listening to it, glad they did this.
I continue to be really excited about Fast EBM. Great to have 10kw beam up from 3 now acknowledged publicly
New order and stock down 4%, weird. Seems like a lot of pple get info before the rest of us, a pattern of moves up and then news a day or two later. Then by time we get the news pullsback.
nice detailed look at the arcam machines and ge situation, thanks
Glad to hear your thinking Gary. I also sold half of mine but unfortunately bought in even bigger around earnings, would be very happy if I had stayed out and got back in now. Not a pleasant dive. I still love the company and think the next year and a half have good things in store, but worried the bottom may keep falling out here with people in panic mode. Your thoughts on that?
Great rene interview. Confirms my hopes that big orders are in the future not to far off. And great to see him say capacity is up to 40-50 machines! Thats a huge increase
ARCAM: BIG YEAR AHEAD
MARCH 7, 2014 NORDIC INVESTOR LEAVE A COMMENT
Swedish news agency Direkt writes today that around a dozen of companies is about to order equipment for 3D-printing during 2014 and that Swedish Arcam is in a good position in those negotiations. Direkt is referring to US investment bank Jeffries and its latest research paper.
Arcam’s CEO Magnus Rene is quoted saying that “that’s what we are trying to achieve. It is absolutely possible that we will receive a volume order already this year, but it is nothing I can promise.” Asked about the current production capacity, Mr Rene says: “We have the capacity to manufacture 40-50 machines today. We are in close discussions with our customers and well prepared for whatever can happen.”
The average price for one of Arcam’s machines was around SEK 5,4m during 2013. At full capacity utilisation with the current capacity this would imply annual revenues from equipment sales of SEK 270m, plus revenues from service activities on top.
Arcam outsources a lot of the actual manufacturing of its machines and is focusing on the final assembly. This allows the company to quickly adapt its capacity. Says CEO Rene: “What we mainly need is staff to assemble, install and conduct the service. One year ago we were around 50 people, now it’s 75.”
Jeffries’ analysts highlight GE as one of the major companies that are about to invest into 3D-printing on a big scale. Arcam is seen as a good bet for orders in connection with the production of parts for the new airplane engine Leap. Says CEO Rene: “We are in discussions with all major airplane engine manufacturers and GE-owned Avio is one of our biggest clients.” He continues to promise that during 2014, it will be possible to fly in civil airplanes that are equipped with details produced by Arcam.
Mr Rene does not expect any pressure on prices despite the growing market which could attract competition. “Our prices have been unchanged or even slightly increasing for many years. We think this will continue. The machines become more and more complex which leads to higher prices.” Asked about emerging competition from China, Mr Rene says: “I believe we will have to live with the competition we currently have. Non of them are Chinese. ”
Share this:
Email
inShare
Share on Tumblr
Print
Like this:
Arcam receives order for Arcam Q20 system
Arcam, listed on NASDAQ OMX, has received an order for an Arcam Q20 system from an European customer.
”This is the third order for our recently released new large system, the Arcam Q20, and the fifth system order this year”, says Magnus René, CEO of Arcam.
Nice find, thanks
Reason for huge bounce in stockholm? Simply a rebound? The split doesn't thus far seem to have lessened volatility
Ugh, rough day, this is getting painful. Fully correcting for the split frenzy plus some.
Arcam press release below translated from Swedish (only came in Swedish as occasionally they do).
Can people who understand all the lingo better than I make sense of this for me? Does the stuff below = additional dilution as it seems? Is that why the stock dipped more today?
NOTICE OF ANNUAL GENERAL MEETING OF ARCAM AB
Shareholders of Arcam AB (publ), reg. No. 556539-5356, are hereby invited to the Annual General Meeting on Thursday, March 27, 2014 at. 17.00 at the company's premises Krokslätts Factories 27A, Mölndal.
Registration will take place between the hours. 16:00 to 16:45.
Shareholders wishing to participate in the Meeting;
- Be registered in their own name (not nominee-registered) in the Euroclear Sweden AB share register no later than 21 March 2014,
- Notify the company not later than March 24, 2014
pm. 12:00, at the address Arcam AB, Krokslätts Factories 27A, 431 37 Mölndal, or by fax 031-710 32 01, or via e-mail carolina@arcam.com .
The number of attending assistants (maximum two) must be notified at the same time.
In the notification, the shareholder shall enter personal identification number or organization, address and telephone number. Shareholders represented by proxy shall produce a written and dated power of attorney on the day of the AGM can not be older than five years. Representatives and representatives of legal entities shall submit authorization documents before the meeting (signed and dated power of attorney and / or current registration).
Shareholders with nominee-registered shares must temporarily re-register their shares in their own name to be entitled to attend the meeting. Such registration must be completed at Euroclear Sweden AB by 21 March 2014 and the broker should therefore be notified in advance of this date.
Draft Agenda
At the AGM, the following matters:
1. Opening of the meeting
2nd Election of Chairman of the Meeting
3rd Preparation and approval of voting list
4th Selection of at least one minutes
5th Ask whether the Meeting has been duly convened
6. Adoption of the agenda
7. Presentation of the annual accounts and the auditors' report and consolidated financial statements and the audit report. In connection therewith, the President's address
8. Decisions on
a) adoption of the income statement and balance sheet and consolidated income statement and consolidated balance sheet
b) appropriation of the profit according to the adopted balance sheet
c) discharge the Board and Chief Executive Officer
9. The number of directors to be elected at the AGM
10th Determination of remuneration to directors and auditors
11. Election of Directors
12. Draft instructions to the Nomination Committee
13. Resolution on guidelines for remuneration to senior executives
14. Decision to issue warrants with the right to subscribe for shares
15. Decision to authorize the Board to issue new shares, issue of convertible debentures or debentures with warrants.
16. Closing of the meeting
Motions
Resolution on the appropriation of profits (item 8 b)
The Board of Directors proposes that no dividend be paid.
The number of directors to be elected at the Meeting (item 9)
The Nomination Committee has decided to announce draft decision by 15 March 2014.
Determination of remuneration to directors and auditors (item 10)
The Nomination Committee has decided to announce draft decision by 15 March 2014.
Election of Directors (Item 11)
The Nomination Committee has decided to announce draft decision by 15 March 2014. The Nominating Committee, appointed in accordance with instructions adopted at the 2013 AGM has consisted of Åsa Knutsson, Henrik Hedlund and Jan Barchan.
Draft instructions for the Nomination Committee (item 12)
The Nomination Committee has decided to announce draft decision by 15 March 2014.
Decision on proposed guidelines for remuneration to senior executives (item 13)
The Board has decided to publish the draft decision by 15 March 2014.
Resolution on private placement of warrants with the right to subscribe for shares (item 14)
The Board proposes that the Meeting resolves to a private placement of a maximum of 200,000 warrants, each entitling to subscribe for one share at a par value of SEK 1 and that the shareholders approve the transfer of these to the conditions described below.
Right to subscribe for the warrants shall, with deviation from the shareholders' preferential rights, the Company's wholly owned subsidiary, Arcam Research and Development Inc., org.nr 556605-8052 (the "Subsidiary"). Subscription shall take place during the period 28 April 2014 to 30 April 2014. The warrants were issued without consideration. Subsidiary shall transfer the warrants in accordance with what is stated below. The reason for the deviation from the shareholders' preferential rights is to ensure the possibility to transfer the options to executive officers, key employees, and strategic partners in Arcam group in order to create a commitment of said persons, as well as easier to recruit and retain skilled employees.
Each warrant entitles the holder to subscribe for one new share in the company. Subscription of shares must occur between 1 June 2017 to 30 June 2017. The board may extend the subscription period. The subscription price for the shares shall correspond to 150 percent of the Company's share average price during the 10 trading days after the date of the 2014 AGM (27 March 2014). Dilution upon exercise of the warrants, including the previous schemes, corresponding to 3.17%. Upon full exercise of the warrants, the Company's share capital will increase by not more than SEK 200 000.
Shares issued following exercise prior to the Annual General Meeting held particular fiscal year are entitled to dividends for the previous financial year. Shares issued following exercise after the AGM held particular fiscal year are entitled to dividends in respect of the financial year.
Subsidiary shall transfer the warrants to senior executives, key employees, and strategic partners of Arcam AB to the extent the Board determines. The offer to acquire warrants shall be on market terms.
The decision falls under the Companies Act, Chapter 16, and requires approval of shareholders representing at least nine tenths of both the votes cast at the Meeting represented shares.
The Board proposes that the Meeting authorize the Board or appointed by the Board, to make minor changes in the decision as may prove necessary for registration with the Companies Registration Office.
Decision to authorize the Board to issue new shares, issue of convertible debentures or debentures with warrants (paragraph 15).
The Board proposes that the Meeting authorize the Board, until the next Annual General Meeting, on one or more occasions, to issue new shares, issue of convertible bonds or warrants. Issue shall be transacted with or without deviation from the shareholders' preferential rights and with or without non-cash, set-off or otherwise with conditions. The overall increase of the share capital pursuant to the authorization shall not exceed 1,800,000. The shares will be issued at the current market price.
This authorization is to give the Board flexibility in efforts to finance and facilitate accelerated expansion and development of the Company, its market and products.
Other Information
Resolution to adopt the point of 15 valid only if approved by shareholders representing at least two thirds of the votes cast at the meeting at which the shares represented.
Resolution to adopt the item 14 is valid only if approved by shareholders representing at least nine tenths of both the votes cast at the meeting at which the shares represented.
Total number of shares and votes in the Company is 18,341,632 at the time of issuing this notice. All shares are of the same kind.
The financial statements, audit report, the auditor's opinion on the application of guidelines for remuneration to senior executives and the complete proposal as set out above will, from March 3, 2014 be available at the company address: Arcam AB, Krokslätts Factories 27A, 431 37 Mölndal, Sweden , and on the Company's website, www.arcam.com . Copies of the documents sent free of charge to shareholders who so request and state their address and will also be available at the AGM. The documents will be tabled at the AGM.
Shareholders have under Chapter 7, § 32 of the Companies Act (2005:551) right at the General Meeting to request information from the Board and CEO of circumstances that may affect items on the agenda and circumstances which may affect the company's financial situation.
Shareholders prior to the meeting wishing to visit the company for showing the business is welcome to Krokslätts Factories 27A at. 16:00.
Mölndal in February 2014
Arcam AB (publ)
Board of Directors