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Kornit Digital Reports Fourth Quarter and Full Year 2023 Results

Kornit Digital Ltd
Kornit Digital Ltd
  • Fourth quarter revenues of $56.6 million, in line with previous guidance

  • Fourth quarter GAAP net loss of $22.9 million; non-GAAP net income of $3.8 million

  • Achieved breakeven adjusted EBITDA and generated positive operating cash flow for the fourth quarter

  • Successfully launched the Apollo platform for general commercial use in early 2024

  • Expecting modest revenue growth, adjusted EBITDA profitability, and positive operating cash flow for the full year 2024

ROSH-HA`AYIN, Israel, Feb. 14, 2024 (GLOBE NEWSWIRE) -- Kornit Digital Ltd. (“Kornit” or the “Company”) (Nasdaq: KRNT), a worldwide market leader in sustainable, on-demand, digital fashionX and textile production technologies, reported today its results for the fourth quarter and full year ended December 31, 2023.

“We experienced a healthy peak season, with year-over-year growth in impressions and double-digit growth in high-margin consumable sales.” said Ronen Samuel, Kornit’s Chief Executive Officer. Mr. Samuel continued, “This growth, combined with improvements to our operating efficiency and working capital position, drove us to positive adjusted EBITDA and cash from operations in the fourth quarter.”

Mr. Samuel concluded, “Despite a challenging operating environment in 2023, we made progress in further diversifying our customer base, established our MAX technology as the new industry standard, and completed a successful beta program for the Apollo. As we enter 2024, while we continue to anticipate macroeconomics headwinds to weigh on our sales cycle, we are focused on leveraging our key drivers to achieve modest revenue growth for the full year. In the first quarter we have taken further actions to restructure and realign our operating expenses with the current market environment. This puts us on solid footing to generate adjusted EBITDA profitability and positive operating cash flow for the full year.”

Fourth Quarter 2023 Results of Operations

  • Total revenue for the fourth quarter of 2023 was $56.6 million compared with $63.3 million in the prior year period, due primarily to lower systems revenues.

  • GAAP gross profit margin for the fourth quarter of 2023 was 25.8% compared with 33.7% in the prior year period. On a non-GAAP basis, gross profit margin was 48.6% compared with 36.4% in the prior year period.

  • GAAP operating expenses for the fourth quarter of 2023 were $42.4 million compared with $38.1 million in the prior year period. On a non-GAAP basis, operating expenses decreased by 8.7% to $30.1 million compared with the prior year period.

  • GAAP net loss for the fourth quarter of 2023 was $22.9 million, or ($0.48) per basic share, compared with net loss of $35.4 million, or ($0.71) per basic share, for the fourth quarter of 2022.

  • Non-GAAP net income for the fourth quarter of 2023 was $3.8 million, or $0.08 per diluted share, compared with non-GAAP net loss of $6.6 million, or ($0.13) per basic share, for the fourth quarter of 2022.

  • Adjusted EBITDA for the fourth quarter of 2023 was $0.2 million compared with adjusted EBITDA loss of $6.1 million for the fourth quarter of 2022. Adjusted EBITDA margin for the fourth quarter of 2023 was 0.3% compared with -9.6% for the fourth quarter of 2022.

Full Year 2023 Results of Operations

  • Total revenue for the full year 2023 was $219.8 million compared with $271.5 million in the prior year, due primarily to lower systems revenues.

  • GAAP gross profit margin for the full year 2023 was 30.5% compared with 35.5% in the prior year. On a non-GAAP basis, gross profit margin was 38.4% compared with 38.2% in the prior year.

  • GAAP operating expenses for the full year 2023 were $154.5 million compared with $166.4 million in the prior year. On a non-GAAP basis, operating expenses decreased by 12.3% to $127.7 million compared with the prior year.

  • GAAP net loss for the full year 2023 was $64.4 million, or ($1.31) per basic share, compared with net loss of $79.1 million, or ($1.59) per basic share, for the full year 2022.

  • Non-GAAP net loss for the full year 2023 was $20.4 million, or ($0.42) per basic share, compared with non-GAAP net loss of $32.6 million, or ($0.66) per basic share, for the full year 2022.

  • Adjusted EBITDA loss for the full year 2023 was $30.9 million compared with adjusted EBITDA loss of $30.8 million for the full year 2022. Adjusted EBITDA margin for the full year 2023 was -14.0% compared with -11.3% for the full year 2022.

First Quarter 2024 Guidance

For the first quarter of 2024, the Company expects revenues to be in the range of $43 million to $48 million and adjusted EBITDA margin between –16% to –26% of revenue. The guidance for revenue and adjusted EBITDA margin includes the impact of the non-cash expense associated with the fair value of the Company’s warrants.

Fourth Quarter and Full Year 2023 Earnings Conference Call Information

The Company will host a conference call today at 8:30 a.m. ET, or 3:30 p.m. Israel time, to discuss the results, followed by a question-and-answer session with the investor community.

A live webcast of the call can be accessed at ir.kornit.com. To access the call, participants may dial toll-free at 1-877-407-0792 or 1-201-689-8263. The toll-free Israeli number is 1 809 406 247. The conference confirmation code is 13744080.

To listen to a replay of the conference call, dial toll-free 1-844-512-2921 or 1-412-317-6671 (international) and enter confirmation code 13744080. The telephonic replay will be available approximately three hours after the completion of the live call until 11:59 pm ET on February 28, 2024. The call will also be available for replay via the webcast link on Kornit’s Investor Relations website.

About Kornit Digital

Kornit Digital (NASDAQ: KRNT) is a worldwide market leader in sustainable, on-demand, digital fashionx and textile production technologies. The Company is writing the operating system for fashion with end-to-end solutions including digital printing systems, inks, consumables, and an entire global ecosystem that manages workflows and fulfillment. Headquartered in Israel with offices in the USA, Europe, and Asia Pacific, Kornit Digital serves customers in more than 100 countries and states worldwide. To learn more about how Kornit Digital is boldly transforming the world of fashion and textiles, visit www.kornit.com.

Forward Looking Statements

Certain statements in this press release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and other U.S. securities laws. Forward-looking statements are characterized by the use of forward-looking terminology such as “will,” “expects,” “anticipates,” “continue,” “believes,” “should,” “intended,” “guidance,” “preliminary,” “future,” “planned,” or other words. These forward-looking statements include, but are not limited to, statements relating to the Company’s objectives, plans and strategies, statements of preliminary or projected results of operations or of financial condition and all statements that address activities, events, or developments that the Company intends, expects, projects, believes or anticipates will or may occur in the future. Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties. The Company has based these forward-looking statements on assumptions and assessments made by its management in light of their experience and their perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. Important factors that could cause actual results, developments and business decisions to differ materially from those anticipated in these forward-looking statements include, among other things: the duration and severity of adverse macro-economic headwinds that were caused by inflationary pressures and higher interest rates, which have impacted, and may continue to impact, in an adverse manner, the Company’s operations, financial position and cash flows, in part due to the adverse impact on the Company’s customers and suppliers; the Company’s degree of success in developing, introducing and selling new or improved products and product enhancements including specifically the Company’s Poly Pro and Presto products, and the Company’s Apollo direct-to-garment platform; the extent of the Company’s ability to consummate sales to large accounts with multi-system delivery plans; the degree of the Company’s ability to fill orders for its systems; the extent of the Company’s ability to increase sales of its systems, ink and consumables; the extent of the Company’s ability to leverage its global infrastructure build-out; the development of the market for digital textile printing; the availability of alternative ink; competition; sales concentration; changes to the Company’s relationships with suppliers; the extent of the Company’s success in marketing; and those additional factors referred to under “Risk Factors” in Item 3.D of the Company’s Annual Report on Form 20-F for the year ended December 31, 2022, filed with the SEC on March 30, 2023. Any forward-looking statements in this press release are made as of the date hereof, whether as a result of new information, future events or otherwise, except as required by law.

Non-GAAP Discussion Disclosure

The Company presents certain non-GAAP financial measures, in this press release and in the accompanying conference call to discuss the Company’s quarterly results. These non-GAAP financial measures reflect adjustments to corresponding GAAP financial measures in order to exclude the impact of the following: share-based compensation expenses; amortization of intangible assets; acquisition related expenses; restructuring expenses; foreign exchange differences associated with ASC 842; and non-cash deferred tax income.

The Company defines “Adjusted EBITDA” as non-GAAP operating income (loss), which reflects the adjustments described in the preceding paragraph, as further adjusted to exclude depreciation expense.

The purpose of the foregoing non-GAAP financial measures is to convey the Company’s performance exclusive of non-cash charges and other items that are considered by management to be outside of the Company’s core operating results. These non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. Furthermore, the non-GAAP measures are regularly used internally to understand, manage, and evaluate the Company’s business and make operating decisions, and the Company believes that they are useful to investors as a consistent and comparable measure of the ongoing performance of the Company’s business. The Company’s non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read only in conjunction with the Company’s consolidated financial statements prepared in accordance with GAAP. Additionally, these non-GAAP financial measures may differ materially from the non-GAAP financial measures used by other companies.

The reconciliation tables included below present a reconciliation of our non-GAAP financial measures to the most directly comparable GAAP financial measures.

Investor Contact:                                                        
Jared Maymon
Global Head of Investor Relations
Jared.Maymon@Kornit.com


 

KORNIT DIGITAL LTD.

AND ITS SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands)

 

 

 

 

 

 

 

December 31,

 

December 31,

 

 

2023

 

2022

 

 

(Unaudited)

 

(Audited)

ASSETS

 

 

 

 

CURRENT ASSETS:

 

 

 

 

Cash and cash equivalents

 

$

39,605

 

 

$

104,597

 

Short-term bank deposit

 

 

235,600

 

 

 

275,033

 

Marketable securities

 

 

57,292

 

 

 

20,380

 

Trade receivables, net

 

 

93,632

 

 

 

67,360

 

Inventory

 

 

67,712

 

 

 

89,415

 

Other accounts receivable and prepaid expenses

 

 

28,546

 

 

 

22,054

 

Total current assets

 

 

522,387

 

 

 

578,839

 

 

 

 

 

 

LONG-TERM ASSETS:

 

 

 

 

Marketable securities

 

 

223,203

 

 

 

245,970

 

Deposits and other long-term assets

 

 

8,209

 

 

 

5,927

 

Severance pay fund

 

 

283

 

 

 

274

 

Property,plant and equipment, net

 

 

50,905

 

 

 

60,463

 

Operating lease right-of-use assets

 

 

23,782

 

 

 

27,139

 

Intangible assets, net

 

 

7,647

 

 

 

9,890

 

Goodwill

 

 

29,164

 

 

 

29,164

 

Total long-term assets

 

 

343,193

 

 

 

378,827

 

 

 

 

 

 

Total assets

 

 

865,580

 

 

 

957,666

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS' EQUITY

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

Trade payables

 

 

6,936

 

 

 

14,833

 

Employees and payroll accruals

 

 

12,121

 

 

 

14,255

 

Deferred revenues and advances from customers

 

 

2,158

 

 

 

5,701

 

Operating lease liabilities

 

 

4,345

 

 

 

4,989

 

Other payables and accrued expenses

 

 

23,814

 

 

 

25,592

 

Total current liabilities

 

 

49,374

 

 

 

65,370

 

 

 

 

 

 

LONG-TERM LIABILITIES:

 

 

 

 

Accrued severance pay

 

 

1,080

 

 

 

1,223

 

Operating lease liabilities

 

 

19,261

 

 

 

21,035

 

Other long-term liabilities

 

 

198

 

 

 

1,216

 

Total long-term liabilities

 

 

20,539

 

 

 

23,474

 

 

 

 

 

 

SHAREHOLDERS' EQUITY

 

 

795,667

 

 

 

868,822

 

 

 

 

 

 

Total liabilities and shareholders' equity

 

$

865,580

 

 

$

957,666

 

 

 

 

 

 


 

KORNIT DIGITAL LTD.

AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(U.S. dollars in thousands, except share and per share data)

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Year Ended

 

December 31,

 

December 31,

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

 

(Unaudited)

 

(Unaudited)

 

Audited

 

 

 

 

 

 

 

 

Revenues

 

 

 

 

 

 

 

Products

$

43,573

 

 

$

49,795

 

 

$

161,045

 

 

$

222,502

 

Services

 

13,012

 

 

 

13,503

 

 

 

58,741

 

 

 

49,016

 

Total revenues

 

56,585

 

 

 

63,298

 

 

 

219,786

 

 

 

271,518

 

 

 

 

 

 

 

 

 

Cost of revenues

 

 

 

 

 

 

 

Products

 

23,125

 

 

 

29,026

 

 

 

91,516

 

 

 

125,935

 

Services

 

18,888

 

 

 

12,923

 

 

 

61,313

 

 

 

49,083

 

Total cost of revenues

 

42,013

 

 

 

41,949

 

 

 

152,829

 

 

 

175,018

 

 

 

 

 

 

 

 

 

Gross profit

 

14,572

 

 

 

21,349

 

 

 

66,957

 

 

 

96,500

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

Research and development, net

 

12,033

 

 

 

13,251

 

 

 

50,060

 

 

 

56,026

 

Sales and marketing

 

17,909

 

 

 

16,150

 

 

 

66,836

 

 

 

71,067

 

General and administrative

 

12,449

 

 

 

8,657

 

 

 

37,592

 

 

 

39,289

 

Total operating expenses

 

42,391

 

 

 

38,058

 

 

 

154,488

 

 

 

166,382

 

 

 

 

 

 

 

 

 

Operating loss

 

(27,819

)

 

 

(16,709

)

 

 

(87,531

)

 

 

(69,882

)

 

 

 

 

 

 

 

 

Financial income, net

 

5,424

 

 

 

5,052

 

 

 

24,150

 

 

 

13,382

 

Loss before taxes on income

 

(22,395

)

 

 

(11,657

)

 

 

(63,381

)

 

 

(56,500

)

 

 

 

 

 

 

 

 

Taxes on income

 

539

 

 

 

23,703

 

 

 

970

 

 

 

22,565

 

Net loss

$

(22,934

)

 

$

(35,360

)

 

$

(64,351

)

 

$

(79,065

)

 

 

 

 

 

 

 

 

Basic loss per share

$

(0.48

)

 

$

(0.71

)

 

$

(1.31

)

 

$

(1.59

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of shares

 

 

 

 

 

 

 

used in computing basic net loss per share

 

48,231,916

 

 

 

49,913,898

 

 

 

49,160,266

 

 

 

49,791,659

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted net loss per share

$

(0.48

)

 

$

(0.71

)

 

$

(1.31

)

 

$

(1.59

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of shares

 

 

 

 

 

 

 

used in computing diluted net loss per share

 

48,231,916

 

 

 

49,913,898

 

 

 

49,160,266

 

 

 

49,791,659

 

 

 

 

 

 

 

 

 


 

 

 

KORNIT DIGITAL LTD.

 

 

AND ITS SUBSIDIARIES

 

 

RECONCILIATION OF GAAP TO NON-GAAP CONSOLIDATED STATEMENTS OF OPERATIONS

 

 

(U.S. dollars in thousands, except share and per share data)

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Year Ended

 

December 31,

 

December 31,

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

 

(Unaudited)

 

(Unaudited)

 

 

 

 

 

 

 

 

Revenues

$

56,585

 

 

$

63,298

 

 

$

219,786

 

 

$

271,518

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP cost of revenues

$

42,013

 

 

$

41,949

 

 

$

152,829

 

 

$

175,018

 

Cost of product recorded for share-based compensation (1)

 

(545

)

 

 

(543

)

 

 

(2,356

)

 

 

(2,185

)

Cost of service recorded for share-based compensation (1)

 

(447

)

 

 

(408

)

 

 

(1,758

)

 

 

(1,676

)

Intangible assets amortization on cost of product (3)

 

(260

)

 

 

(266

)

 

 

(1,053

)

 

 

(1,402

)

Intangible assets amortization on cost of service (3)

 

(160

)

 

 

(160

)

 

 

(640

)

 

 

(640

)

Excess cost of product on acquired inventory (2)

 

-

 

 

 

-

 

 

 

-

 

 

 

(663

)

Restructuring expenses (4)

 

(11,501

)

 

 

(305

)

 

 

(11,590

)

 

 

(701

)

Non-GAAP cost of revenues

$

29,100

 

 

$

40,267

 

 

$

135,432

 

 

$

167,751

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP gross profit

$

14,572

 

 

$

21,349

 

 

$

66,957

 

 

$

96,500

 

Gross profit adjustments

 

12,913

 

 

 

1,682

 

 

 

17,397

 

 

 

7,267

 

Non-GAAP gross profit

$

27,485

 

 

$

23,031

 

 

$

84,354

 

 

$

103,767

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP operating expenses

$

42,391

 

 

$

38,058

 

 

$

154,488

 

 

$

166,382

 

Share-based compensation (1)

 

(4,653

)

 

 

(4,264

)

 

 

(18,475

)

 

 

(18,788

)

Acquisition related expenses (2)

 

-

 

 

 

-

 

 

 

-

 

 

 

(512

)

Intangible assets amortization (3)

 

(93

)

 

 

(138

)

 

 

(550

)

 

 

(501

)

Restructuring expenses (4)

 

(7,579

)

 

 

(711

)

 

 

(7,785

)

 

 

(992

)

Non-GAAP operating expenses

$

30,066

 

 

$

32,945

 

 

$

127,678

 

 

$

145,589

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP Financial income, net

$

5,424

 

 

$

5,052

 

 

$

24,150

 

 

$

13,382

 

Foreign exchange losses associated with ASC 842

 

1,579

 

 

 

285

 

 

 

378

 

 

 

(3,123

)

Non-GAAP Financial income , net

$

7,003

 

 

$

5,337

 

 

$

24,528

 

 

$

10,259

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP Taxes on income

$

539

 

 

$

23,703

 

 

$

970

 

 

$

22,565

 

Non-cash deferred tax income (expenses)

$

88

 

 

$

(10,234

)

 

$

666

 

 

$

(10,014

)

Non-recurring tax payment (a)

$

-

 

 

$

(11,485

)

 

$

-

 

 

$

(11,485

)

Non-GAAP Taxes on income

$

627

 

 

$

1,984

 

 

$

1,636

 

 

$

1,066

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP net loss

$

(22,934

)

 

$

(35,360

)

 

$

(64,351

)

 

$

(79,065

)

Share-based compensation (1)

 

5,645

 

 

 

5,215

 

 

 

22,589

 

 

 

22,649

 

Acquisition related expenses (2)

 

-

 

 

 

-

 

 

 

-

 

 

 

512

 

Intangible assets amortization (3)

 

513

 

 

 

564

 

 

 

2,243

 

 

 

2,543

 

Restructuring expenses (4)

 

19,080

 

 

 

1,016

 

 

 

19,375

 

 

 

1,693

 

Excess cost of product on acquired inventory (2)

 

-

 

 

 

-

 

 

 

-

 

 

 

663

 

Foreign exchange losses associated with ASC 842

 

1,579

 

 

 

285

 

 

 

378

 

 

 

(3,123

)

Non-cash deferred tax expenses (income)

 

(88

)

 

 

10,234

 

 

 

(666

)

 

 

10,014

 

Non-recurring tax payment (a)

 

-

 

 

 

11,485

 

 

 

-

 

 

 

11,485

 

Non-GAAP net income (loss)

$

3,795

 

 

$

(6,561

)

 

$

(20,432

)

 

$

(32,629

)

 

 

 

 

 

 

 

 

GAAP diluted loss per share

$

(0.48

)

 

$

(0.71

)

 

$

(1.31

)

 

$

(1.59

)

 

 

 

 

 

 

 

 

Non-GAAP diluted income (loss) per share

$

0.08

 

 

$

(0.13

)

 

$

(0.42

)

 

$

(0.66

)

 

 

 

 

 

 

 

 

Weighted average number of shares

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares used in computing GAAP diluted net loss per share

 

48,231,916

 

 

 

49,913,898

 

 

 

49,160,266

 

 

 

49,791,659

 

 

 

 

 

 

 

 

 

Shares used in computing Non-GAAP diluted net income (loss) per share

 

50,094,714

 

 

 

49,913,898

 

 

 

49,160,266

 

 

 

49,791,659

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Share-based compensation

 

 

 

 

 

 

 

Cost of product revenues

$

545

 

 

$

543

 

 

$

2,356

 

 

$

2,185

 

Cost of service revenues

$

447

 

 

 

408

 

 

 

1,758

 

 

 

1,676

 

Research and development

$

1,329

 

 

 

1,340

 

 

 

5,759

 

 

 

5,312

 

Sales and marketing

$

1,635

 

 

 

1,693

 

 

 

6,689

 

 

 

7,361

 

General and administrative

$

1,689

 

 

 

1,231

 

 

 

6,027

 

 

 

6,115

 

 

$

5,645

 

 

$

5,215

 

 

$

22,589

 

 

$

22,649

 

(2) Acquisition related expenses

 

 

 

 

 

 

 

Cost of product revenues

 

-

 

 

 

-

 

 

 

-

 

 

 

663

 

General and administrative

$

-

 

 

$

-

 

 

$

-

 

 

$

512

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

1,175

 

(3) Intangible assets amortization

 

 

 

 

 

 

 

Cost of product revenues

$

260

 

 

$

266

 

 

$

1,053

 

 

$

1,402

 

Cost of service revenues

$

160

 

 

 

160

 

 

 

640

 

 

 

640

 

Sales and marketing

$

93

 

 

 

138

 

 

 

550

 

 

 

501

 

 

$

513

 

 

$

564

 

 

$

2,243

 

 

$

2,543

 

 

 

 

 

 

 

 

 

(4) Restructuring expenses

 

 

 

 

 

 

 

Cost of product revenues

$

5,569

 

 

$

305

 

 

$

5,658

 

 

$

689

 

Cost of service revenues

$

5,932

 

 

 

-

 

 

 

5,932

 

 

 

12

 

Research and development

$

860

 

 

 

137

 

 

 

880

 

 

 

201

 

Sales and marketing

$

2,744

 

 

 

487

 

 

 

2,930

 

 

 

675

 

General and administrative

$

3,975

 

 

 

87

 

 

 

3,975

 

 

 

116

 

 

$

19,080

 

 

$

1,016

 

 

$

19,375

 

 

$

1,693

 

 

 

 

 

 

 

 

 

(a) Attributed to tax settlement with the Israeli Tax Authority

 

 

 

 

 

 

 

 


 

KORNIT DIGITAL LTD.

AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(U.S. dollars in thousands)

 

 

 

 

 

Three Months Ended

 

Year Ended

 

December 31,

 

December 31,

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

 

(Unaudited)

 

(Unaudited)

Audited

Cash flows from operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

$

(22,934

)

 

$

(35,360

)

 

$

(64,351

)

 

$

(79,065

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

Depreciation and amortization

 

3,287

 

 

 

4,399

 

 

 

14,700

 

 

 

13,565

 

Restructuring and other charges

 

19,080

 

 

 

-

 

 

 

19,080

 

 

 

-

 

Fair value of warrants deducted from revenues

 

4,841

 

 

 

4,339

 

 

 

13,842

 

 

 

22,500

 

Share-based compensation

 

5,645

 

 

 

5,215

 

 

 

22,589

 

 

 

22,649

 

Amortization of premium and accretion of discount on marketable securities, net

 

83

 

 

 

373

 

 

 

756

 

 

 

1,820

 

Realized gain on sale and redemption of marketable securities

 

93

 

 

 

-

 

 

 

134

 

 

 

10

 

Change in operating assets and liabilities:

 

 

 

 

 

 

 

Trade receivables, net

 

6,557

 

 

 

(3,673

)

 

 

(19,220

)

 

 

(15,891

)

Other accounts receivables and prepaid expenses

 

(5,040

)

 

 

(2,501

)

 

 

(6,492

)

 

 

(8,635

)

Inventory

 

4,521

 

 

 

(2,437

)

 

 

11,028

 

 

 

(29,004

)

Operating leases right-of-use assets and liabilities, net

 

1,544

 

 

 

229

 

 

 

(179

)

 

 

(2,918

)

Deferred taxes

 

-

 

 

 

11,523

 

 

 

-

 

 

 

8,530

 

Deposits and other long term assets

 

(103

)

 

 

(1,859

)

 

 

(2,282

)

 

 

(4,251

)

Trade payables

 

(2,902

)

 

 

(9,068

)

 

 

(6,491

)

 

 

(26,948

)

Employees and payroll accruals

 

(2,294

)

 

 

(2,222

)

 

 

(1,089

)

 

 

(7,674

)

Deferred revenues and advances from customers

 

(1,339

)

 

 

107

 

 

 

(4,990

)

 

 

(1,426

)

Other payables and accrued expenses

 

(8,357

)

 

 

(8,873

)

 

 

(10,547

)

 

 

7,190

 

Accrued severance pay, net

 

(14

)

 

 

43

 

 

 

(152

)

 

 

(237

)

Other long - term liabilities

 

(74

)

 

 

330

 

 

 

(1,018

)

 

 

13

 

Loss (gain) from sale and disposal of property, plant and equipment

 

-

 

 

 

(142

)

 

 

-

 

 

 

425

 

Net cash provided by (used in) operating activities

$

2,594

 

 

$

(39,577

)

 

$

(34,682

)

 

$

(99,347

)

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Purchase of property, plant and equipment

$

(934

)

 

$

(5,776

)

 

$

(7,006

)

 

$

(18,042

)

Investment in equity securities

 

-

 

 

 

(193

)

 

 

-

 

 

 

(820

)

Acquisition of intangible assets

 

-

 

 

 

(73

)

 

 

-

 

 

 

(308

)

Proceeds from sale of property, plant and equipment

 

-

 

 

 

-

 

 

 

-

 

 

 

71

 

Cash paid in connection with acquisition, net of cash acquired

 

-

 

 

 

-

 

 

 

-

 

 

 

(14,654

)

Proceeds from (investment in) short-term bank deposits, net

 

(15,505

)

 

 

85,089

 

 

 

39,433

 

 

 

(265,865

)

Proceeds from sales and redemption of marketable securities

 

-

 

 

 

-

 

 

 

7,240

 

 

 

1,945

 

Proceeds from maturities of marketable securities

 

6,300

 

 

 

6,500

 

 

 

20,522

 

 

 

27,898

 

Investment in marketable securities

 

(9,526

)

 

 

(8,135

)

 

 

(33,977

)

 

 

(137,500

)

Net cash provided by (used in) investing activities

$

(19,665

)

 

$

77,412

 

 

$

26,212

 

 

$

(407,275

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exercise of employee stock options

$

-

 

 

$

159

 

 

$

293

 

 

$

619

 

Payments related to shares withheld for taxes

 

(608

)

 

 

(90

)

 

 

(1,045

)

 

 

(951

)

Repurchase of ordinary shares

 

(19,004

)

 

 

-

 

 

 

(55,770

)

 

 

-

 

Net cash used in financing activities

$

(19,612

)

 

$

69

 

 

$

(56,522

)

 

$

(332

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Increase (decrease) in cash and cash equivalents

$

(36,683

)

 

$

37,904

 

 

$

(64,992

)

 

$

(506,954

)

Cash and cash equivalents at the beginning of the period

 

76,288

 

 

 

66,693

 

 

 

104,597

 

 

 

611,551

 

Cash and cash equivalents at the end of the period

$

39,605

 

 

$

104,597

 

 

$

39,605

 

 

$

104,597

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-cash investing and financing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Purchase of property and equipment on credit

 

314

 

 

 

1,692

 

 

 

314

 

 

 

1,692

 

Inventory transferred to be used as property and equipment

 

-

 

 

 

5,248

 

 

 

531

 

 

 

6,792

 

Property, plant and equipment transferred to be used as inventory

 

131

 

 

 

-

 

 

 

865

 

 

 

-

 

Lease liabilities arising from obtaining right-of-use assets

 

(3,250

)

 

 

408

 

 

 

2,559

 

 

 

7,585

 

 

 

 

 

 

 

 

 



 

 

 

 

KORNIT DIGITAL LTD.

AND ITS SUBSIDIARIES

RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA

(U.S. dollars in thousands, except share and per share data)

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Year Ended

 

 

December 31,

 

December 31,

 

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

 

 

(Unaudited)

 

(Unaudited)

 

 

 

 

 

 

 

 

 

GAAP Revenues

 

$

56,585

 

 

$

63,298

 

 

$

219,786

 

 

$

271,518

 

 

 

 

 

 

 

 

 

 

GAAP Net Loss

 

 

(22,934

)

 

 

(35,360

)

 

 

(64,351

)

 

 

(79,065

)

Taxes on income

 

 

539

 

 

 

23,703

 

 

 

970

 

 

 

22,565

 

Financial income

 

 

(5,424

)

 

 

(5,052

)

 

 

(24,150

)

 

 

(13,382

)

Share-based compensation

 

 

5,645

 

 

 

5,215

 

 

 

22,589

 

 

 

22,649

 

Intangible assets amortization

 

 

513

 

 

 

564

 

 

 

2,243

 

 

 

2,543

 

Acquisition related expenses

 

 

-

 

 

 

-

 

 

 

-

 

 

 

512

 

Excess cost of product on acquired inventory

 

-

 

 

 

-

 

 

 

-

 

 

 

663

 

Restructuring expenses

 

 

19,080

 

 

 

1,016

 

 

 

19,375

 

 

 

1,693

 

Non-GAAP Operating Loss

 

 

(2,581

)

 

 

(9,914

)

 

 

(43,324

)

 

 

(41,822

)

Depreciation

 

 

2,774

 

 

 

3,835

 

 

 

12,457

 

 

 

11,022

 

Adjusted EBITDA

 

$

193

 

 

$

(6,079

)

 

$

(30,867

)

$

(30,800

)


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