3D Systems Corp (DDD) 2006 Q1 法說會逐字稿

Welcome to the 3D Systems Conference Call and Web Cast to discuss operating results for the first quarter of 2006. My name is Sarah and I’ll be facilitating today’s interactive broadcast. [OPERATOR INSTRUCTIONS] Thank you. Ms. Hughes, you may begin your conference.

歡迎參加 3D Systems 電話會議和網路廣播，討論 2006 年第一季的營運成果。我叫 Sarah，我將主持今天的互動廣播。 [操作員說明] 謝謝。休斯女士，您可以開始會議了。

Sarah, our slides are not working.

莎拉，我們的幻燈片不起作用。

Okay. One moment.

好的。一會兒。

Ladies and gentlemen, we’re having some technical difficulties so I’m going to go ahead and start welcoming you to our 3D Systems Conference Call to discuss first quarter 2006 operating results. I am [Tandra Hughes], Investor Relations Coordinator and with me on the call are Abe Reichental, our CEO, Fred Jones, our CFO, and Bob Grace, our General Counsel.

女士們先生們，我們遇到了一些技術困難，所以我將繼續歡迎您參加我們的 3D Systems 電話會議，討論 2006 年第一季的營運結果。我是 [Tandra Hughes]，投資者關係協調員，與我一起參加電話會議的有我們的執行長 Abe Reichental、我們的財務長 Fred Jones 和我們的總法律顧問 Bob Grace。

Earlier this morning we issued a press release with our quarter one operating results for 2006. We also filed our Form 10-Q with the SEC, that you can find on our website or through the [Edgar] database. For those of you who want more information, you will undoubtedly want to review the 10-Q.

今天早些時候，我們發布了一份新聞稿，介紹了2006 年第一季的營運業績。我們也向SEC 提交了10-Q 表格，您可以在我們的網站上或透過[Edgar] 資料庫找到該表格。對於那些想要了解更多資訊的人來說，您無疑會想要查看 10-Q。

The audio web cast portion of this call contains a slide presentation that we will be referring to during the call. Those following along on the phone who wish to access the slide portion of this presentation may do so via the 3D Systems website at www.3dsystems.com. Should you chose to do so, we recommend that you sign in for the interactive teleconference. This will give you the ability to ask questions related to this conference call at the end of the session.

本次通話的音訊網路廣播部分包含我們將在通話期間參考的幻燈片簡報。透過電話關注並希望存取本簡報幻燈片部分的人可以透過 3D Systems 網站 www.3dsystems.com 進行存取。如果您選擇這樣做，我們建議您登入參加互動式電話會議。這將使您能夠在會議結束時提出與本次電話會議相關的問題。

For those of you who have access to the streaming portion of the web cast, please be aware that here is a three second delay and that you will not be able to post questions via the web.

對於那些有權訪問網路廣播串流媒體部分的人，請注意，這裡有三秒的延遲，並且您將無法透過網路發布問題。

Before we begin the discussion, I would like to preface our presentation today with a statement regarding forward-looking information. Certain statements made in this release that are not statements of historical or current facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may involve known and unknown risks, uncertainties and other facts that may cause the actual results, performance or achievements of the Company to be materially different from historical results or from any future results expressed or implied by such forward-looking statements. In addition to statements that explicitly describe such risks and uncertainties, readers are urged to consider statements in the future tenses or that include the terms “believes”, “belief”, “expects”, “intends”, “anticipates” or “plans” to be uncertain and forward-looking. Forward-looking statements may include comments as to the Company’s beliefs and expectations as to future events and trends affecting its business. Forward-looking statements are basically management’s current expectations concerning future events and trends and are necessarily subject to uncertainties. Many of which are outside the control of the Company. The factors stated under the heading “Forward-Looking Statements” and “Cautionary Stations and risk Factors” in management’s discussion and analysis of results of operations and financial conditions, which appear in the Company’s periodic filings with the Securities and Exchange Commission, as well as other factors, could cause actual results to differ materially from those reflected or predicted in forward-looking statements.

在我們開始討論之前，我想以有關前瞻性資訊的聲明作為我們今天演講的序言。本新聞稿中的某些非歷史或當前事實陳述的陳述屬於1995 年《私人證券訴訟改革法案》含義內的前瞻性陳述。前瞻性陳述可能涉及已知和未知的風險、不確定性和其他可能導致任何導致本公司的實際結果、績效或成就與歷史結果或此類前瞻性陳述明示或暗示的未來結果有重大差異。除了明確描述此類風險和不確定性的陳述外，還敦促讀者考慮將來時態的陳述或包含“相信”、“相信”、“期望”、“打算”、“預期”或“計劃”等術語的陳述具有不確定性和前瞻性。前瞻性陳述可能包括對公司對影響其業務的未來事件和趨勢的信念和期望的評論。前瞻性陳述基本上是管理階層目前對未來事件和趨勢的預期，必然受到不確定性的影響。其中許多不屬於公司的控制範圍。管理階層對經營績效和財務狀況的討論和分析中「前瞻性陳述」和「警示和風險因素」標題下所述的因素，這些因素出現在公司向證券交易委員會提交的定期文件中，以及其他因素可能導致實際結果與前瞻性陳述中反映或預測的結果有重大差異。

This call is being recorded and will be available for review until one week from today.

本次通話正在錄音，從今天起一週內可供審核。

This call and presentation can also be accessed via the 3D Systems’ website under the Investor Relations section. At this time, I would like to introduce Abe Reichental, our CEO.

您也可以透過 3D Systems 網站的投資者關係部分存取本次電話會議和簡報。這次我想介紹一下我們的執行長 Abe Reichental。

Good morning, everyone and thanks for taking the time to listen to our call. This morning, as usual, I will give you an overview of our first quarter results and Fred Jones, our CFO will discuss the financial aspects in more detail. I will then review some of our recent business highlights and review our current outlook.

大家早安，感謝您抽出寶貴時間收聽我們的電話。今天早上，像往常一樣，我將向您概述我們第一季的業績，我們的財務長 Fred Jones 將更詳細地討論財務方面的問題。然後我將回顧我們最近的一些業務亮點並回顧我們當前的前景。

We were very pleased to announce earlier this morning that revenue for the first quarter rose to $33.5 million, a new first quarter record and a 10% increase over the 2005 quarter. Absent the adverse effects of foreign currency translation, revenue for the first quarter would have increased by 14.5%. Our revenue increase was driven by higher unit volume and the combined favorable effect of changes in product makes and average selling prices, continuing the trends from prior periods. We’re particularly pleased that revenue from new systems and materials increased to almost one-third of total revenue in the first quarter.

今天早些時候，我們非常高興地宣布，第一季的收入增至 3,350 萬美元，創下第一季的新紀錄，比 2005 年季度增長 10%。如果沒有外幣換算的不利影響，第一季營收將成長14.5%。我們的收入成長是由單位銷售增加以及產品製造和平均銷售價格變化的綜合有利影響所推動的，延續了前期的趨勢。我們特別高興的是，第一季新系統和材料的收入增加到總收入的近三分之一。

Sales of systems increased 21% and sales of materials increased 18%. Revenue from services decreased 9%, principally due to a $.4 million unfavorable affect of foreign currency translation and planned reductions of Legacy Systems upgrade packages, some of which we have discontinued all together. Additionally, some of our more sophisticated automated manufacturing systems required extensive commissioning and training. As a result of the high volume of sales of these systems and the need to provide more extended customer training support and installation activities than the traditional services provided with our Legacy Systems, we have experienced significant field service resource constraint. We believe that the additional costs and foregone ordinary service revenue associated with these growth challenges adversely affected our revenue growth and profitability during the first quarter of 2006 as we devoted substantial resources to meet the needs of our customers. While we believe that these are healthy growth pains, we are putting in place an immediate corrective action plan to cope with the increased activity level proactively and cost effectively.

系統銷售額成長 21%，材料銷售額成長 18%。服務收入下降 9%，主要是由於外幣換算造成 40 萬美元的不利影響以及計劃減少舊系統升級包（其中一些升級包我們已全部停止）。此外，我們的一些更複雜的自動化製造系統需要大量的調試和培訓。由於這些系統的銷售量很高，並且需要比我們的舊系統提供的傳統服務提供更廣泛的客戶培訓支援和安裝活動，因此我們遇到了嚴重的現場服務資源限制。我們相信，與這些成長挑戰相關的額外成本和放棄的普通服務收入對我們 2006 年第一季的收入成長和獲利能力產生了不利影響，因為我們投入了大量資源來滿足客戶的需求。雖然我們認為這些都是健康成長的煩惱，但我們正在立即制定糾正行動計劃，以主動且經濟有效地應對活動水平的增加。

Our gross profit increased by $1 million or 8% reflecting our higher revenue. But our gross profit margin declined by .9 of a percentage point, reflecting the additional costs we incurred in connection with our extended duration installation and the duplicated overhead costs associated with exiting our Grand Junction facility and setting up operations in Marly, Switzerland and Rock Hill, South Carolina. We also continued to devote considerable resources to our relocation to Rock Hill, South Carolina and several other strategic and special long-term projects that resulted in a operating loss for the first quarter. These activities included the following. $1.6 million of severance and restructuring costs that we incurred in the first quarter related to our relocation to Rock Hill, South Carolina, which were in-line with our previously disclosed expectations. $1.1 million of higher selling, general and administrative expenses, including $.2 million expense on vested stock options granted before 2005 under SFAS No. 123R and $.6 million of higher R&D investment, reflecting our near term efforts to commercial additional 3-D Printers and rapid manufacturing systems and materials.

我們的毛利增加了 100 萬美元，即 8%，反映出我們收入的增加。但我們的毛利率下降了 0.9 個百分點，反映出我們因延長安裝時間而產生的額外成本，以及因退出大章克申工廠並在瑞士馬爾利和羅克山設立業務而產生的重複管理費用， 南卡羅來納。我們也繼續投入大量資源用於搬遷到南卡羅來納州羅克山以及其他幾個策略和特殊長期項目，這些項目導致第一季出現營運虧損。這些活動包括以下內容。第一季我們因搬遷到南卡羅來納州羅克山而產生了 160 萬美元的遣散費和重組費用，這符合我們先前揭露的預期。銷售、一般和管理費用增加110 萬美元，包括2005 年之前根據SFAS 第123R 號授予的既得股票期權的費用20 萬美元，以及研發投資增加60 萬美元，反映了我們近期為商業化額外3-D所做的努力印表機和快速製造系統和材料。

That in combination with our Oracle-based ERP system implementation, which started successfully on May 3rd, our European shared service center consolidation and our initiative to outsource all logistic activities to UPS negatively affected our first quarter earnings and resulted in a $.6 million operating loss and a $1.2 million or $0.08 per share net loss available to common stockholders on a fully diluted basis.

結合我們於5 月3 日成功啟動的基於Oracle 的ERP 系統實施、我們的歐洲共享服務中心整合以及我們將所有物流活動外包給UPS 的舉措，對我們第一季度的收益產生了負面影響，並導致營業收入60 萬美元虧損以及普通股股東在完全稀釋的基礎上可獲得的 120 萬美元或每股 0.08 美元的淨虧損。

Now, for a more detailed look at our quarterly financial performance, let me turn the presentation over to Fred Jones, our Chief Financial Officer. Fred?

現在，為了更詳細地了解我們的季度財務業績，讓我將簡報交給我們的財務長 Fred Jones。弗雷德？

Thanks, Abe. Our web cast participants can see a bar chart on this Slide 9, comparing revenue by quarter for the last four years. This year’s first quarter is the 10th consecutive quarter of year-over-year increases and the first quarter gain of $3.1 million, a 10% increase over last year’s first quarter. And as Abe just mentioned, in constant US dollar terms, the revenue was up by 14.5%.

謝謝，阿部。我們的網路直播參與者可以在這張投影片 9 上看到一個長條圖，該圖比較了過去四年按季度的收入。今年第一季是連續第10季年增，第一季財報達310萬美元，比去年第一季成長10%。正如安倍剛才提到的，以不變美元計算，收入成長了14.5%。

Slide 10 shows the factors that resulted in that $3.1 million net increase in revenue in the first quarter. Starting on the left-hand side of the chart was last year’s $30.4 million of first quarter revenue, we can see that the unit volume of core legacy products was lower this year, resulting in $2.1 million lower revenue from core products, continuing trends that we’ve discussed in prior periods.

幻燈片 10 顯示了導致第一季收入淨增長 310 萬美元的因素。從圖表左側開始，去年第一季的營收為3,040 萬美元，我們可以看到，今年核心遺留產品的單位銷售量較低，導致核心產品的收入減少了210 萬美元，這延續了我們先前預測的趨勢。前幾期已經討論過。

On the other hand, we had an offsetting $1.2 million favorable effect of price and mix. And a $5.3 million of incremental revenue contribution from new products introduced since the fourth quarter of 2003. Now, when you compare this new product increase with the core product decrease, you can see that the traction we’ve gained in the transformation of our product’s portfolio.

另一方面，我們的價格和產品組合帶來了 120 萬美元的有利影響。自2003 年第四季以來推出的新產品帶來了530 萬美元的增量收入貢獻。現在，當您將新產品的增加與核心產品的減少進行比較時，您可以看到我們在產品轉型中獲得的牽引力。文件夾。

The last component, the foreign currency translation reduced the U.S. dollar equivalent of revenue from Europe and the Asia Pacific region as the dollar has strengthened significantly against those currencies in those regions from period to period. These factors combined to produce the $33.5 million in revenue depicted on the last bar, representing this year’s first quarter revenue.

最後一個組成部分，即外幣換算減少了歐洲和亞太地區的美元等值收入，因為美元兌這些地區的貨幣在不同時期都大幅走強。這些因素結合起來產生了最後一個長條圖所示的 3,350 萬美元的收入，代表了今年第一季的收入。

New product revenue continued its trend of becoming an increasingly important component of our revenue on a comparable quarter-to-quarter basis we’re making good progress. This year’s first quarter had $5.3 million more new product revenue than last year’s first quarter. New products grew from 22.4% of revenue in last year’s quarter to 33.6% of revenue in this year’s quarter. And we believe that the marketplace leadership is maintained through technology leadership and new product revenue is an important indicator to us of that technology leadership.

新產品收入繼續保持其成為我們收入中越來越重要的組成部分的趨勢，在可比較的季度基礎上，我們取得了良好的進展。今年第一季的新產品收入比去年第一季增加了 530 萬美元。新產品佔營收的比例從去年季度的 22.4% 成長到今年季度的 33.6%。我們相信，市場領先地位是透過技術領先地位來維持的，而新產品收入是我們技術領先地位的重要指標。

On a constant dollar basis, we’re pleased with the results in North America and Europe and the decline in Asia Pacific is primarily a result of the growth pains that we’re experiencing there. Revenue from our U.S. operations grew by 28% to $18.3 million, primarily because of higher unit volume, the favor combined effect of price and mix, favorable effects of our restructured U.S. sales force, sales to new customers and to a broader range of applications and benefits of promotional efforts for materials in prior periods.

以美元不變計算，我們對北美和歐洲的業績感到滿意，而亞太地區的下滑主要是我們在那裡經歷的成長陣痛的結果。我們美國業務的收入成長了 28%，達到 1,830 萬美元，主要是因為單位銷售增加、價格和產品組合的有利綜合效應、我們重組的美國銷售隊伍、對新客戶和更廣泛應用的銷售以及前期材料促銷工作的好處。

Revenue from European operations was basically flat and declined to 33% of total revenue because of the significant increase in U.S. revenue and the unfavorable foreign exchange translation effect. At constant exchange rates, revenue from Europe would have increased 8.5% because of new product sales and favorable effects of price and mix.

由於美國營收大幅成長以及不利的外匯折算效應，歐洲業務收入基本持平，佔總營收的比例下降至33%。以固定匯率計算，由於新產品銷售以及價格和產品組合的有利影響，來自歐洲的收入將成長 8.5%。

Revenue from Asia Pacific operations decreased almost 18% to $4.1 million, reflecting a lower unit volume from the lumpy nature of our business in that region and the effects of our growth challenges and unfavorable foreign currency translation impacts.

亞太地區業務收入下降近 18% 至 410 萬美元，反映出我們在該地區業務的不穩定以及我們的成長挑戰和不利的外幣換算影響導致單位銷售下降。

On a product line basis, systems and materials revenues proportionately increased at the expense of service and all three classes were adversely affected by foreign exchange translation effects.

在產品線的基礎上，系統和材料收入按比例增加，但以服務為代價，所有三個類別都受到外匯換算影響的不利影響。

Revenue from systems increased to 22% to $12.3 million, primarily due to a $3.6 million increase in volume of sales of our new systems, such as our [Viper] Pro and [Central] Station Pro Systems This increase was partially offset by a decline in legacy product sales, unfavorable FX translation and to a lesser extent, the unfavorable combined effect of price and mix.

系統收入成長 22%，達到 1,230 萬美元，主要是由於我們的新系統（例如 [Viper] Pro 和 [Central] Station Pro 系統）的銷量增加了 360 萬美元，這一增長被部分收入下降所抵消。傳統產品銷售、不利的外匯換算以及較小程度的價格和組合的不利綜合效應。

Revenue from materials increased 18% to $11.9 million, primarily due to a $1.5 million increase from higher unit sales of new products and another $1.3 million favorable combined effect of price and mix, which included the benefits of promotional efforts in prior periods. And this was partially offset by FX translation effects and a decline in core materials unit volume.

材料收入成長 18%，達到 1,190 萬美元，主要是由於新產品銷售增加導致 150 萬美元的成長，以及價格和產品組合的有利綜合效應（其中包括前期促銷活動的好處）130 萬美元。這被外匯換算效應和核心材料單位數量的下降部分抵消。

Revenue from services decreased 9% to $9.3 million, principally due to a decline in services related to core products and this reflected our improved component reliability, which has resulted in lower volume in certain replacement parts because of their long [reserve] time, lower time and material service business, some of which resulted from our field engineers being captured on existing systems commissionings and unable to respond to routine service calls and reduced upgrades on core products following our decision to cease offering upgrades for older legacy systems And revenue from services also declined because of lower warranty revenue and adverse translation effects.

服務收入下降9% 至930 萬美元，主要是由於與核心產品相關的服務減少，這反映了我們組件可靠性的提高，導致某些替換零件的數量減少，因為它們的[儲備]時間較長，時間較短和材料服務業務，其中一些是由於我們的現場工程師在現有系統調試中被捕獲，無法響應日常服務呼叫，以及在我們決定停止為舊遺留系統提供升級後減少了核心產品的升級，服務收入也下降了由於保固收入減少和不利的換算效應。

Gross profit increased by $1 million to $14 million, but our gross profit margin declined to 42% from 43% of consolidated revenue last year. Products gross margin was down almost 1 percentage point, while [inaudible] services component experienced a 5 percentage point decline. Those product and service margins were impacted by growing pains. The service margins in the first quarter of 2006 were also adversely affected by their lower revenue level, which included lower sales of upgrades for older legacy systems, lower volumes of certain replacement parts and by higher training and field service activity to support the higher level of large frame shipments in the last several months.

毛利增加了 100 萬美元，達到 1,400 萬美元，但毛利率從去年合併收入的 43% 下降到 42%。產品毛利率下降了近 1 個百分點，而 [聽不清楚] 服務部分則下降了 5 個百分點。這些產品和服務的利潤受到成長煩惱的影響。 2006 年第一季的服務利潤率也受到較低收入水準的不利影響，其中包括舊遺留系統升級產品銷售量下降、某些替換零件數量減少以及為支持更高水準的培訓和現場服務活動而增加.過去幾個月的大型框架出貨量。

As shown on the left half of Slide 14, the operating expenses in the first quarter increased by $3.3 million, or 29% to $14.3 million, compared to $11.4 million in the first quarter of 2005. The higher costs shown in the bar graphs were primarily due to $1.6 million of severance and restructuring costs, primarily related to our planned relocation to Rock Hill, South Carolina. Of course, there were no restructuring costs in last year’s first quarter, but they constituted more than half of the increase in operating expenses in this year’s first quarter and they were generally in line with our previously disclosed expectations.

如投影片14 左半部所示，第一季的營運費用增加了330 萬美元，即29%，達到1,430 萬美元，而2005 年第一季的營運費用為1,140 萬美元。條形圖中顯示的較高成本主要是由於由於 160 萬美元的遣散費和重組費用，主要與我們計劃搬遷到南卡羅來納州羅克山有關。當然，去年第一季沒有重組費用，但佔今年第一季營業費用增量的一半以上，基本上符合我們先前揭露的預期。

Consistent with our guidance last quarter, we estimate that total pretax costs this year for relocation and consolidation should be in the range of $6.4 million to $8.1 million. Similarly, we continue to estimate savings of $2.5 million per year beginning next year, as a result of our relocation. And we continue to be that our relocation to South Carolina will translate into long-term improvements in profitability.

與我們上季度的指導一致，我們估計今年搬遷和整合的稅前總成本應在 640 萬美元至 810 萬美元之間。同樣，我們預計從明年開始，由於搬遷，每年將節省 250 萬美元。我們仍然認為，搬遷到南卡羅來納州將轉化為盈利能力的長期改善。

Our investment in R&D, shown in the green portion of the bar, rose by $.6 million to $3.3 million. This increase included development costs required to launch additional desktop printer models. And we recently announced an exciting agreement with Symyx to discover and commercialize new advanced materials. Consequently, we are increasing our estimate of R&D expenses for this year, to the range of $12 million to $14 million.

我們的研發投資（如長條圖的綠色部分所示）增加了 60 萬美元，達到 330 萬美元。這一增長包括推出更多桌上型印表機型號所需的開發成本。我們最近宣布與 Symyx 達成一項令人興奮的協議，以發現新的先進材料並將其商業化。因此，我們將今年的研發費用預估上調至 1,200 萬美元至 1,400 萬美元。

Selling, general and administrative expenses rose by $1.1 million to $9.8 million. There are three components of that $1.1 million increase that are worth noting. First, $.2 million of this increase arose solely from adoption on January 1st to accounting standard 123R, requiring amortization of stock options which we granted two or more years ago. Because we ceased granting stock options about two years ago, amortization of options will be completed by the end of next year. We expect subsequent quarterly amortization amounts to be roughly at the same level as that of the first quarter, until a total of $1.3 million has been amortized, and that includes our first quarter’s amount.

銷售、一般和管理費用增加 110 萬美元，達到 980 萬美元。 110 萬美元的成長中有三個值得注意的部分。首先，這一增長中的 20 萬美元完全來自於 1 月 1 日採用會計準則 123R，要求攤銷我們在兩年或更長時間前授予的股票選擇權。由於我們大約兩年前停止授予股票選擇權，選擇權攤銷將在明年年底完成。我們預計隨後的季度攤銷額將與第一季的攤銷額大致相同，直到攤銷總額達到 130 萬美元，其中包括我們第一季的攤銷額。

Secondly, some $.4 million of higher SG&A expenses are selling related expenses, which are mostly driven by our higher revenue level.

其次，約 40 萬美元的較高 SG&A 費用是銷售相關費用，這主要是由我們較高的收入水準所推動的。

Thirdly, there is some significant cost in the first quarter of this year, which are related to our growth pains that Abe described.

第三，今年第一季有一些重大成本，這與安倍所描述的我們的成長陣痛有關。

Slide 15 lists some of the differences in operating costs year-to-year. We do not expect that these are indicative of a trend. And for example, first we expect SFAS 123R amortization to finish by the end of next year. Secondly, the first quarter’s R&D spending level is consistent with and largely linked to our previously announced plans to roll out new desktop printers and to maintain our technological leadership. And we believe it’s important to continue R&D investments to maintain our technological leadership.

投影片 15 列出了每年營運成本的一些差異。我們並不認為這些顯示了一種趨勢。例如，首先我們預計 SFAS 123R 攤銷將於明年年底完成。其次，第一季的研發支出水準與我們先前宣布的推出新桌上型印表機並保持技術領先地位的計劃一致並在很大程度上相關。我們認為，繼續研發投資以維持我們的技術領先地位非常重要。

Thirdly, the relocation experiences we are experiencing are essentially a 2006 phenomenon that we decided to undertake with expectation of lower operating expenses in 2007 and future years.

第三，我們正在經歷的搬遷經驗本質上是2006年的現象，是我們決定進行的，預計2007年和未來幾年的營運費用會降低。

And fourthly, we expect that our growing pains will be addressed in a cost-effective manner over time. Consequently, we do not expect this operating expense level to be permanent.

第四，我們期望隨著時間的推移，我們的成長煩惱將以一種具有成本效益的方式得到解決。因此，我們預計這種營運費用水準不會是永久性的。

The other items on the income statement are pretty straight forward and I only wanted to note that both basic and diluted earnings or loss per share are the same as our stock options and convertible securities are anti-dilutive for losses.

損益表上的其他項目非常簡單，我只想指出，基本每股盈餘或稀釋收益或虧損與我們的股票選擇權和可轉換證券是反稀釋損失的相同。

In order to help get the earnings changes in perspective, Slide 17 shows the impact of two special items affecting the quarter. Our headquarters relocation costs shows as severance and restructuring costs on our income statement amounted to over $1.6 million. Those costs were equivalent to $0.11 per share on a pretax basis. And a stock compensation amortization pursuant to newly adopted SFAS 123R was $179,000 during the quarter. Combined, these two items were equivalent to a swing in diluted EPS of $0.12, which is very significant compared to the earnings level that were reported in the first quarters of 2006 and 2005. Now, this scheduled does not contain any of the costs related to our growth challenges, because those costs involve some cross-functional impacts which we are just not in a position to fully quantify in monetary terms.

為了幫助了解收益變化，投影片 17 顯示了影響本季的兩個特殊項目的影響。我們的總部搬遷成本顯示，損益表上的遣散費和重組成本超過 160 萬美元。這些成本相當於稅前每股 0.11 美元。根據新採用的 SFAS 123R，本季的股票薪酬攤銷為 179,000 美元。這兩項合計相當於稀釋後每股收益 0.12 美元的波動，與 2006 年和 2005 年第一季度報告的收益水平相比，這是非常顯著的。現在，該計劃不包含與我們的成長挑戰，因為這些成本涉及一些跨職能的影響，我們無法以貨幣形式完全量化。

Notwithstanding our net loss, cash flow provided by operations was $3 million, reflecting positive changes in working capital operating accounts, including a net reduction in accounts receivable and higher levels of accounts payable. This compares very favorably to the $.3 million of net cash generated from operations in the first three months of 2005. We’re committed to improving working capital management and we hope that we can maintain the momentum from the working capital improvements in the first quarter.

儘管出現淨虧損，但營運提供的現金流為 300 萬美元，反映出營運資金營運帳戶的正面變化，包括應收帳款淨減少和應付帳款水準提高。 This compares very favorably to the $.3 million of net cash generated from operations in the first three months of 2005. We're committed to improving working capital management and we hope that we can maintain the momentum from the working capital improvements in the first四分之一.

We used $2.2 million of net cash for property and equipment investments, predominantly related to our new Oracle-based ERP systems. This was double the rate of investment in the first quarter of 2005. We are raising our estimate of expected spending for property and equipment this year, primarily because of expanded scope and additional efforts being applied to our new ERP implementation. We now expect to spend in the range of $5 million to $6 million on property and equipment investments this year.

我們將 220 萬美元的淨現金用於財產和設備投資，主要與基於 Oracle 的新 ERP 系統相關。這是 2005 年第一季投資率的兩倍。我們提高了今年財產和設備預期支出的估計，主要是因為我們新的 ERP 實施範圍擴大了，並且付出了額外的努力。我們現在預計今年的財產和設備投資支出將在 500 萬至 600 萬美元之間。

Our financing activity proceeds in both years’ first quarters predominantly reflected net proceeds from stock option exercises, offset by small scheduled debt service payments. Net cash generation this year increased to $2.3 million in the first quarter, compared to $.2 million in last year’s first quarter. And we ended in both years’ first quarters at roughly the same $26.5 million cash balances.

我們兩年第一季的融資活動收益主要反映了股票選擇權行使的淨收益，並被小額定期償債付款所抵銷。今年第一季的淨現金產生量增至 230 萬美元，而去年第一季為 20 萬美元。兩年第一季結束時，我們的現金餘額大致相同，均為 2,650 萬美元。

Depreciation and amortization were up slightly this year, reflecting the $.2 million in SFAS 123R non cash expense. Because of our higher capital expenditures on property and equipment, depreciation and amortization for the year should be in the range of $6 million to $7 million.

今年的折舊和攤提略有增加，反映出 SFAS 123R 非現金支出為 20 萬美元。由於我們在財產和設備上的資本支出較高，因此今年的折舊和攤提應在 600 萬至 700 萬美元之間。

Another perspective on our cash generation is obtained by looking at the components of net cash from operations. The orange bar represents our net cash provided by operations as presented in our consolidated statement of cash flows. You can see that one of its two components, cash from operating activities before changes in operating accounts, which is depicted by the blue bar, has risen from a negative $3.7 million in the first quarter of 2003 to a positive $1.2 million in the first quarter of 2006. The green bar represents cash provided by or used for changes in operating accounts. These working capital accounts produced $3.8 million of cash in 2003 from accounts receivable reductions, but they have been a use of cash in the last two years’ first quarters.

關於我們現金生成的另一個視角是透過觀察營運淨現金的組成部分來獲得的。橘色條代表我們的合併現金流量表中營運提供的淨現金。您可以看到，其兩個組成部分之一，即經營帳戶變化之前的經營活動現金（以藍色條表示）已從2003 年第一季的負370 萬美元上升到第一季的正120 萬美元2006 年的數據。綠色條代表營運帳戶變動提供或使用的現金。 2003 年，這些營運資金帳戶因應收帳款減少而產生了 380 萬美元的現金，但在過去兩年的第一季度，它們一直在使用現金。

In this year’s first quarter, positive changes in working capital accounts generated $1.8 million. We’re very pleased that after giving effect to non-cash items, both operations and working capital management contributed to cash generation thus far this year, which was significantly higher than in the previous three years’ first quarters.

今年第一季度，營運資金帳戶的積極變化產生了 180 萬美元。我們非常高興的是，在非現金項目生效後，今年迄今為止，營運和營運資本管理都為現金產生做出了貢獻，顯著高於前三年第一季。

And that concludes my comments, Abe.

我的評論到此結束，安倍。

Thank you, Fred. Before we open the line for the q and a, I just wanted to give you a more comprehensive business update and summarize some of our expectations for the near term and the mid-term.

謝謝你，弗雷德。在我們開始問答之前，我只想向您提供更全面的業務更新，並總結我們對近期和中期的一些期望。

We are continuing to expand and grow our 3-D printing program and product line, specifically during the first quarter. We extended our resale channels to 85 locations. We introduced a $14,900 desktop 3-D printer, making it the most affordable 3-D printer in its class and accessible to a broader audience of engineers, marketers and students worldwide. We launched the InVision Dental Pro, which helps dental labs transition into the digital age. And earlier this week, at our annual users group meeting in Tucson, Arizona, we introduced two new InVision LD material colors, red and blue, to give our customers a broader range of capabilities. We’re very encouraged with the overall market reception for the InVision LD and particularly in the untapped educational segment.

我們正在繼續擴大和發展我們的 3D 列印專案和產品線，特別是在第一季。我們將轉售管道擴展至 85 個地點。我們推出了一款售價 14,900 美元的桌上型 3D 列印機，使其成為同類產品中最實惠的 3D 列印機，可供全球更廣泛的工程師、行銷人員和學生使用。我們推出了 InVision Dental Pro，它可以幫助牙科實驗室過渡到數位時代。本週早些時候，在亞利桑那州圖森舉行的年度用戶小組會議上，我們推出了兩種新的 InVision LD 材料顏色：紅色和藍色，為我們的客戶提供更廣泛的功能。我們對 InVision LD 的整體市場接受度感到非常鼓舞，特別是在尚未開發的教育領域。

Consistent with our belief that the only sure way to achieve and maintain market leadership is through technology leadership, a significant portion of our increased R&D investment during the first quarter reflects our previously announced plan to launch additional affordable and compact desktop 3-D printers.

我們相信，實現和維持市場領先地位的唯一可靠方法是透過技術領先地位，我們在第一季度增加的研發投資的很大一部分反映了我們之前宣布的推出更多經濟實惠的緊湊型桌面3D 列印機的計劃。

In the Rapid Manufacturing arena, we’re pleased during the first quarter over 60% of our systems were sold into direct and indirect manufacturing operations. We attribute this success to our ability to commercialize more sophisticated and automated manufacturing systems, as well as our success in introducing a steady stream of higher performance, end-use materials.

在快速製造領域，我們很高興第一季超過 60% 的系統被出售給直接和間接製造業務。我們將這一成功歸功於我們將更複雜和自動化的製造系統商業化的能力，以及我們成功引入穩定的更高性能、最終用途材料的能力。

And notwithstanding our short-term costly growing pains, it is abundantly clear that the combination of larger frame SLA and SLS automated manufacturing platforms and new materials is delivering significant new benefits to a growing customer base. Specifically, our customers can now produce much larger parts in a single build cycle. These much larger parts are also much more accurate than has ever been seen before from any additive manufacturing system, which in and of itself, opens the door to numerous direct and indirect manufacturing applications, such as [tooling], [fixturing] and more importantly, precision casting.

儘管我們在短期內經歷了代價高昂的成長陣痛，但很明顯，更大框架 SLA 和 SLS 自動化製造平台與新材料的結合正在為不斷增長的客戶群帶來顯著的新優勢。具體來說，我們的客戶現在可以在單一建置週期內生產更大的零件。這些更大的零件也比以前從任何增材製造系統中看到的更加精確，其本身為許多直接和間接製造應用打開了大門，例如[工具]、[夾具]，更重要的是、精密鑄造。

Another bright benefit our customers experience from our new and expanded system solutions is clearly depicted on Slide 25. Because of the significant build size envelope, increase of both of our [inaudible] from the ground up manufacturing capable systems, the Viper Pro and the Central Station Pro, our customers can now build more parts faster, reducing their cost per part and their time to market.

投影片25 清楚地描述了我們的客戶從我們新的和擴展的系統解決方案中體驗到的另一個明顯好處。由於建造尺寸很大，我們的[聽不清楚] 從頭開始的製造能力系統Viper Pro 和Central Station Pro，我們的客戶現在可以更快地製造更多零件，從而降低每個零件的成本並縮短上市時間。

And finally, our growing family of high-end engineered materials and composites, in combination with our proprietary smart material packing and delivery systems, provides our customers with unique flexibility and much higher yields.

最後，我們不斷成長的高端工程材料和複合材料系列，與我們專有的智慧材料包裝和輸送系統相結合，為我們的客戶提供了獨特的靈活性和更高的產量。

One of these new materials is Accura 60, which we just introduced this week. It produces durable stiff and tough parts that mimics polycarbonate and it is an ideal material for complex casting applications.

這些新材料之一是我們本週剛推出的 Accura 60。它可生產模仿聚碳酸酯的耐用、堅硬且堅韌的零件，是複雜鑄造應用的理想材料。

Earlier this week at our user’s group meeting, we introduced this new production, planning and plotting software tools 3DView, 3DManage and 3DPrint for our Viper Pro manufacturing systems, that we expect will deliver numerous productivity and cost-saving benefits to our customers. We also introduced some new selective laser sensoring automation tools that let part builds start faster, that facilitate build time estimation and faster management of SDL files.

本週早些時候，在我們的使用者小組會議上，我們推出了適用於Viper Pro 製造系統的新生產、規劃和繪圖軟體工具3DView、3DManage 和3DPrint，我們預計它將為我們的客戶帶來大量生產力和成本節約優勢。我們也推出了一些新的選擇性雷射感測自動化工具，可以讓零件建置更快啟動，從而促進建置時間估計和更快地管理 SDL 檔案。

About one week we announced that we entered into a material research collaboration agreement with Symyx Technologies. The Symyx collaboration provides us with yet another significant step towards the achievement of our long-term Rapid Manufacturing business development goals. As we have said before, we are committed to developing advanced materials with the performance characteristics and functionality range suitable for manufacturing and used parts and assemblies. We expect our research and development program with Symyx, a world-class research and development partner, with proprietary high [inaudible] research technologies, to yield accelerated [inaudible] and commercialization or new higher functionality, affordable materials for every day Rapid Manufacturing applications.

大約一周後，我們宣布與 Symyx Technologies 簽訂了一份材料研究合作協議。 Symyx 合作為我們實現長期快速製造業務發展目標又邁出了重要一步。正如我們之前所說，我們致力於開發具有適合製造和使用的零件和組件的性能特徵和功能範圍的先進材料。我們期望與世界級研發合作夥伴Symyx 的研發計劃，擁有專有的高[聽不清楚] 研究技術，以加速[聽不清楚] 和商業化，或為日常快速製造應用帶來新的更高功能、價格實惠的材料。

For this collaboration, we plan to create a steady stream of new manufacturing capable materials, that we expect will result in breakthrough discoveries and commercial success for a broad range of next generation materials. We also expect that it will drive new technology development to meet customer needs and further differentiate ourselves from competition and that it will lead to significant transformation within the industry.

對於此次合作，我們計劃創造源源不絕的新型製造材料，我們預計這將為廣泛的下一代材料帶來突破性發現和商業成功。我們也期望它將推動新技術開發，以滿足客戶需求，進一步使我們在競爭中脫穎而出，並將導致產業內的重大轉型。

Through this agreement, Symyx will conduct research exclusively for 3D Systems in the Rapid Prototyping, Rapid Manufacturing field and 3D printing and grant us exclusive IP rights to program inventions and we will pay Symyx royalties on any materials that they will develop and we will commercialize.

透過這項協議，Symyx 將專門為3D Systems 在快速原型製作、快速製造領域和3D 列印領域進行研究，並授予我們程式發明的專有智慧財產權，我們將向Symyx 為其開發和商業化的任何材料支付版稅。

Continuing on Slide 31, we are pleased to share with you this morning that our interim Rock Hill facility, which we opened in early January, is in full operation. In fact, our department transition is ahead of plan. Specifically, our customer service department, technical support center, supply chain organization, finance department, HR and IT departments are currently all operating from our Rock Hill facility. And we have hired key personnel in our engineering and marketing departments.

繼續投影片 31，今天早上我們很高興與您分享，我們於 1 月初啟用的臨時 Rock Hill 設施已全面投入運作。事實上，我們的部門過渡提前於計劃。具體來說，我們的客戶服務部門、技術支援中心、供應鏈組織、財務部門、人力資源和 IT 部門目前都在我們的 Rock Hill 工廠運作。我們也聘請了工程和行銷部門的關鍵人員。

In February, we also signed a lease and broke ground on our new state of the art Rapid Manufacturing facility in Rock Hill and construction is in progress. In fact, if you had the opportunity to see the lobby slide before our web cast, you would have seen that construction is well underway. We’re working on the disposition of the Valencia and Grand Junction facilities. We listed the Colorado and California facilities and as planned, a few days ago, we closed the Colorado facility all together.

今年二月，我們還簽署了租約，並在 Rock Hill 新建的最先進的快速製造工廠破土動工，目前施工正在進行中。事實上，如果您有機會在我們的網路直播之前看到大廳幻燈片，您會發現施工正在順利進行。我們正在處理瓦倫西亞和大章克申設施的處置。我們列出了科羅拉多州和加利福尼亞州的工廠，並按照計劃，幾天前，我們一起關閉了科羅拉多州的工廠。

Our InVision material production, which was manufactured in Colorado, is now successfully produced in our Marly, Switzerland facility and to complete our move out of Grand Junction and to significantly improve our logistics, we recently outsourced all spare parts and material logistics to UPS.

我們在科羅拉多州製造的 InVision 材料產品現已在瑞士馬爾利工廠成功生產，為了完成從大章克申的搬遷並顯著改善我們的物流，我們最近將所有備件和材料物流外包給 UPS。

Furthermore, during the first quarter we lowered our 2006 cost estimate for the relocation down to a range of $6.4 million to $8.1 million, from the previously estimated range of $7 million to $8.7 million. And as we previously mentioned, we plan to occupy our new facility by September of 2006.

此外，在第一季度，我們將 2006 年搬遷成本估算從先前估算的 700 萬美元至 870 萬美元下調至 640 萬美元至 810 萬美元。正如我們之前提到的，我們計劃在 2006 年 9 月之前入住我們的新設施。

We are very pleased to share with you this morning that this past Monday morning we started up our Oracle-based ERP system successfully. In accordance with our previously announced plan, we anticipate to go live in Europe and Asia Pacific on June 1st. The expected benefits of this $4 million investment are that it will allow us to process customer transactions better and faster, making us much more friendly and easy to do business with. That it will enhance our automation and productivity, thus reducing our overall transactional cost and improving our accuracy and price stability. That it will provide us with more effective control and most importantly, that it will also enable us to manage our daily business with better financial reports and analysis.

今天早上我們非常高興地與您分享，上週一早上我們成功啟動了基於 Oracle 的 ERP 系統。根據我們先前宣布的計劃，我們預計將於 6 月 1 日在歐洲和亞太地區上線。這項 400 萬美元投資的預期好處是，它將使我們能夠更好、更快地處理客戶交易，使我們更加友好、更容易開展業務。它將提高我們的自動化和生產力，從而降低我們的整體交易成本並提高我們的準確性和價格穩定性。它將為我們提供更有效的控制，最重要的是，它還將使我們能夠透過更好的財務報告和分析來管理我們的日常業務。

After the end of the first quarter, we entered into an agreement with UPS to outsource most of our [inaudible] logistics and order fulfillment operation to UPS. Under this agreement, UPS will fill all of our spare parts, materials and systems orders, which are received daily by 11:00 p.m., Eastern Time. We are exploring the possibility of conducting [inaudible] service activities [inaudible] of our desktop printers out of UPS, as well. And we are pleased that our U.S. supply channel operations have been fully and completely transitioned to UPS as of last week and we anticipate going live with our European phase out of [Colum], Germany next month.

第一季末後，我們與 UPS 達成協議，將我們的大部分[聽不清楚]物流和訂單履行業務外包給 UPS。根據該協議，UPS 將履行我們在東部時間每天晚上 11 點之前收到的所有備件、材料和系統訂單。我們也正在探索透過 UPS 對我們的桌上型印表機進行[聽不清楚]服務活動[聽不清楚]的可能性。我們很高興我們的美國供應通路業務已在上週完全過渡到 UPS，並且我們預計下個月將在德國 [Colum] 的歐洲階段逐步退出。

As I have said in previous calls, while we are pleased with our continuous progress, we are not ready to declare victory. In fact, we continue to concentrate on our long-term strategic growth plan and execute the long-term [inaudible] profitable growth.

正如我在之前的電話中所說，雖然我們對不斷取得的進展感到高興，但我們還沒有準備好宣布勝利。事實上，我們繼續專注於我們的長期策略成長計劃並執行長期[聽不清楚]獲利成長。

We recognize that from time to time we may experience disappointing, short-term financial performance for a longer [inaudible] sustained benefit. While we are continuing to address the issues and growth pains that caused all disappointments, we believe that we are making consistent progress against our planned business transformation and plan to stay the course, realizing full well that from time to time we may sacrifice short-term results for longer term stockholder value.

我們認識到，有時我們可能會經歷令人失望的短期財務業績，以獲得更長期[聽不清楚]的持續利益。雖然我們正在繼續解決導致所有失望的問題和成長陣痛，但我們相信，我們正在按照計劃的業務轉型取得持續進展，併計劃堅持到底，充分認識到我們有時可能會犧牲短期利益長期股東價值的結果。

In line with that, we’re continuing to focus on several significant growth programs and key initiatives till the balance of this year. Our key initiatives for the balance of 2006 continue to reflect our priorities and execution plans. Specifically, we plan to complete our European implantation and planned headquarters consolidation on scheduled and within budget. Encouraged by our successful North American restructuring of our sales and marketing organization, we are restructuring and reorganizing our sales and marketing in Europe and Japan. As evidenced by our continued increase in R&D investments, we are planning to commercialize additional desktop 3-D Printers. And to get ready for that, we are growing our 3-D Printer reseller channel globally. We will continue to enhance the service effectiveness and profitability, while continuing at the same time, to prune our portfolio and retire older legacy systems. And helped by our transition to UPS, we remained focused on improving operations in our customer’s experience.

據此，我們將繼續關注幾項重大成長計畫和關鍵舉措，直到今年年底。我們 2006 年剩餘時間的主要舉措繼續反映我們的優先事項和執行計劃。具體來說，我們計劃按計劃並在預算範圍內完成我們的歐洲植入和計劃中的總部整合。受到北美銷售和行銷組織成功重組的鼓舞，我們正在歐洲和日本重組和重組我們的銷售和行銷。我們不斷增加研發投資就證明了這一點，我們計劃將更多桌上型 3D 列印機商業化。為了為此做好準備，我們正在全球拓展 3D 列印機經銷商通路。我們將繼續提高服務效率和獲利能力，同時繼續精簡我們的產品組合併淘汰舊的遺留系統。在轉型為 UPS 的幫助下，我們仍專注於改善客戶體驗的營運。

While we remain focused on our key initiatives, longer term we continue to see a number of basic assets and drivers as we expect to enhance our future performance as we continue to aggressively work towards our goals. These assets and drivers include our leading industry position and technology, our energized and experienced team, our clear priority with demonstrated execution, our stronger financial base and flexibility, our favorable results from recent strategic initiatives, such as outsourcing activities, reshaping and expanding the sales organization and announcing significant new products. Our healthy pipeline of additional opportunities, our concentration on two significant growth opportunities, 3-D Printing and Rapid Manufacturing and our dedication to delivering measurable value for our customers and stockholders.

雖然我們仍然專注於我們的關鍵舉措，但從長遠來看，我們繼續看到一些基本資產和驅動因素，因為我們預計隨著我們繼續積極努力實現我們的目標，從而提高我們未來的業績。這些資產和驅動因素包括我們領先的產業地位和技術、我們充滿活力且經驗豐富的團隊、我們明確的優先事項和明確的執行力、我們更強大的財務基礎和靈活性、我們最近的策略舉措（例如外包活動、重塑和擴大銷售）所取得的良好成果組織並宣布重要的新產品。我們擁有健康的額外機會管道、我們專注於 3D 列印和快速製造這兩個重要成長機會，以及我們致力於為客戶和股東提供可衡量的價值。

As we continue to transition [inaudible] from our business model from restructuring towards longer term sustained profitable growth, we remain dedicated to delivering that value.

隨著我們繼續從重組業務模式轉向長期持續獲利成長[聽不清楚]，我們仍然致力於實現這一價值。

We will now open the call to questions.

我們現在開始提問。

We will now open the call to questions. We kindly request that you ask one question at a time and then return to the cue, thus allowing other participants to ask questions.

我們現在開始提問。我們懇請您一次提出一個問題，然後再回來提示，以便其他參與者可以提問。

[OPERATOR INSTRUCTIONS] Your first question comes from the line of Dennis Wassung, Canacord Adams.

[操作員說明] 您的第一個問題來自 Canacord Adams 的 Dennis Wassung。

Thank you. A quick question on some of the actions taken in the quarter and soon after the quarter. First, the UPS outsourcing, I’m curious if you can talk about the cost benefits there? What kind of cost savings do you think you can garner from that relationship? And then similarly on the ERP side, going live here, does that mean a lot of the costs are already through the P&L? It sounded like on the Cap Ex side, there was still some more in there. I’m just curious as to how much of the Q1 cost came from the ERP and where that goes from here?

謝謝。關於本季和本季後不久採取的一些行動的簡短問題。首先是UPS外包，我很好奇你能談談那裡的成本效益嗎？您認為您可以從這種關係中節省哪些成本？同樣，在 ERP 方面，在這裡上線，是否意味著許多成本已經計入損益表？聽起來在資本支出方面，還有更多的東西在那裡。我只是好奇第一季的成本有多少是來自 ERP，又是從何而來？

Thank you for the question. It’s a good one. I will answer the UPS part and I will ask for John to shed some more light on the ERP side.

感謝你的提問。這是一個很好的。我將回答 UPS 部分，並請 John 進一步闡述 ERP 方面的情況。

Regarding UPS, up until we shut down our Grand Junction, Colorado facility on April 28, we did all of our fulfillment of spare parts and materials and some of our systems out of that facility. The nature of our business is such that particularly when it came to parts and materials, most of that had to be freighted, overnight which meant that we had to use carriers like DHL, Fed Ex and others. Because we are not logistic specialists and in our business model, probably would never have the opportunity to become as good as a company like Wal-Mart, who wrote the book on synchronized logistics, we figured that we would go to the best. [Inaudible] and UPS today, as you well know, offer incredible capabilities for companies, such as ours. And by going to a centralized fulfillment out of Louisville here in the United States and Colum, Germany, we believe that over time we will garner significant efficiencies and cost reductions, simply because we had a premium overnight delivery component baked into our cost already by virtuals using carriers like Fed Ex and DHL all along. We further believe that our accuracy, our forecasting, our inventory carrying costs and our ability to more accurately purchase and maintain the right levels, will greatly be enhanced by virtue of the UPS synchronized system. And so, over time we believe that that would favorably impact our costs.

關於 UPS，直到我們在 4 月 28 日關閉科羅拉多州大章克申工廠之前，我們所有的備件和材料以及一些系統都是在工廠完成的。我們業務的性質是這樣的，特別是在零件和材料方面，其中大部分都必須隔夜運輸，這意味著我們必須使用 DHL、Fed Ex 等承運商。因為我們不是物流專家，而且在我們的商業模式中，可能永遠沒有機會變得像沃爾瑪這樣優秀的公司，沃爾瑪寫了關於同步物流的書，所以我們認為我們會做到最好。如您所知，[聽不清楚] 今天的 UPS 為我們這樣的公司提供了令人難以置信的功能。透過在美國路易斯維爾和德國科勒姆進行集中履行，我們相信隨著時間的推移，我們將獲得顯著的效率和成本降低，僅僅是因為我們已經透過虛擬技術將優質的隔夜交付組件納入了我們的成本中一直使用 Fed Ex 和 DHL 等承運商。我們進一步相信，憑藉 UPS 同步系統，我們的準確性、預測、庫存持有成本以及更準確地採購和維持正確水準的能力將大大提高。因此，隨著時間的推移，我們相信這將對我們的成本產生有利的影響。

Fred, why don’t you talk a little bit about the ERP portion?

Fred，為什麼不談談 ERP 部分呢？

Dennis, as you know, I think most of the costs for implementing ERP systems may be capitalized and we have done that where we can and where we’ve captured the information, there’s certain costs, such as training costs, that must be expensed. There are some other costs, for example, some of our personnel that we can capitalize, we do. But we have backup people and those are kind of interim people at a higher cost. And so, that gets through our G&A expense. And sometimes it’s hard to identify costs. IF someone travels as part of the implementation but does other business while they are there, we may not do the perfect job of splitting those costs. So, I can’t give you an exact impact on G&A, but I can tell you it was certainly there during the first quarter. And it will continue somewhat, certainly through the second quarter.

丹尼斯，正如你所知，我認為實施ERP 系統的大部分成本可能都是資本化的，我們已經盡可能地做到了這一點，並且在我們捕獲了資訊的情況下，某些成本（例如培訓成本）必須支出。還有一些其他成本，例如我們可以資本化的一些人員成本，我們確實這樣做了。但我們有後備人員，這些都是臨時人員，成本較高。因此，這可以透過我們的一般管理費用來解決。有時很難確定成本。如果有人作為實施的一部分出差，但在那裡做其他業務，我們可能無法完美地分攤這些成本。因此，我無法向您提供對一般行政費用的確切影響，但我可以告訴您，第一季肯定存在這種影響。這種情況肯定會持續到第二季​​。

And I think, Fred, we can anecdotally share with all of you that certainly in the course of the first quarter, in combination between the relocation to South Carolina and ERP, to a large extent kept duplicated departments. For example, we carried two full compliments of customer service departments, while we were taking care of business. And at the same time, training the new recruits on the Rock Hill side to operate and go live with ERP. Similarly, we ended up towards the end of days of Colorado operating with virtually two supply chain departments and Fred, in your case, you were largely operating with two departments here, as well, as you were exiting data flow on this side and training your new group in Rock Hill to operate with Oracle.

Fred，我想，我們可以與大家分享一下，在第一季度，結合搬遷到南卡羅來納州和 ERP，在很大程度上保留了重複的部門。例如，我們在處理業務時得到了客戶服務部門的兩次充分讚揚。同時，對 Rock Hill 方面的新員工進行 ERP 操作和上線培訓。同樣，我們最終在科羅拉多州運營了幾乎兩個供應鏈部門，弗雷德，就您而言，您也主要在這裡與兩個部門運營，因為您正在退出這一側的數據流並培訓您的供應鏈部門。位於 Rock Hill 的新團隊將與 Oracle 合作營運。

Right. And many of those costs got into the restructuring category.

正確的。其中許多成本都屬於重組類別。

Right.

正確的。

You start splitting hairs on the classification, so.

你開始在分類上爭論不休，所以。

Thank you.

謝謝。

Next question, please.

請下一個問題。

Your next question comes from the line of Troy Jensen with Piper Jaffray.

你的下一個問題來自 Troy Jensen 和 Piper Jaffray 的對話。

Hey, gentlemen. I’ve got a couple of modeling questions for Fred. I think tomorrow is the first day you guys have the ability to call the preferred. So, let me know if that’s correct. And maybe your intent. I’m just thinking, Fred, since we’re modeling here, I’d love to get appropriate thoughts on a preferred stock dividend payments in Q2 and what the share account may look like.

嘿，先生們。我有幾個建模問題想問 Fred。我認為明天是你們有能力打電話給首選的第一天。所以，請告訴我這是否正確。也許是你的意圖。我只是在想，弗雷德，既然我們在這裡建模，我很想對第二季度的優先股股息支付以及股票帳戶可能會是什麼樣子有適當的想法。

Well, you’re correct that tomorrow is the first date that we could. If and when we decide to do so, we will publicly announce that decision.

好吧，你說得對，明天就是我們第一次約會。如果我們決定這樣做，我們將公開宣布該決定。

Can you give us any scenarios where it wouldn’t be most beneficial to the shareholders to not call that preferred?

您能否給我們舉出一些場景，在這些場景中，如果不將其稱為優先股，對股東來說不是最有利的？

Again Troy, once we make a decision, we’ll publicly announce it. But I think any objective observation would look like it would be an attractive thing to do.

特洛伊，一旦我們做出決定，我們就會公開宣布。但我認為任何客觀的觀察看起來都是一件有吸引力的事。

Okay. Perfect. Helpful. And how about on taxes, Fred. I’m just curious to know, do you guys plan on reporting taxes this quarter? It looks like we didn’t in the first quarter and just kind of an update on what you guys think you’ll have to report this year for taxes?

好的。完美的。有幫助。弗雷德，稅務方面怎麼樣？我只是想知道，你們計劃本季報稅嗎？看起來我們在第一季沒有這樣做，只是更新了你們認為今年必須申報的稅金？

Well, we’ve said that expect the effect -- we will provide a tax provision when we have pretax income. We do not provide a tax against income because we had a slight pretax loss in the first quarter. The provision you see there is a combination of taxes off shore and some A&P in the United States. When the pretax number is positive, then there would be a tax provision. We’ve said that expect that to be in the range of 25% to 30%, effective rate.

好吧，我們已經說過，預期效果——當我們有稅前收入時，我們將提供稅收撥備。我們不提供所得稅，因為我們在第一季有輕微的稅前虧損。您看到的條款是離岸稅和美國的一些 A&P 的組合。當稅前數字為正數時，就會有稅務撥備。我們說過，預計有效率在 25% 到 30% 之間。

Okay. Perfect. Thanks guys and good luck going forward.

好的。完美的。謝謝大家，祝你一切順利。

Your next question comes from the line of Andy Schopick with Nutmeg Securities.

您的下一個問題來自 Nutmeg Securities 的 Andy Schopick。

Thank you and good morning. A couple of questions here. First Abe, what are the applications for color? How much of an expansion of the market opportunity does this provide? I am familiar with one other privately owned company that offers this capability. And I just wondered if you could elaborate a little bit about the basis behind going --?

謝謝你，早安。這裡有幾個問題。首先，Abe，色彩有哪些應用？這提供了多少市場擴展機會？我熟悉另一家提供這種功能的私人公司。我只是想知道你是否可以詳細說明背後的基礎——？

Sure. Sure. Good question. For us, when we talk about colors, we talk about solid colors. I believe that the other company that you reference, has the ability to provide multiple colors, which is a different slice; it’s a different audience, if you will. For us, the ability to provide color allows users to look at parts with greater intensity and greater detail. Typically, the colors that were chose, red and blue, highlight and intensify feature detail and they’re very critical for designers and engineers when they look at very intricate parts. We plan to continue to expand color offerings, also because certain pigments colors allow engineers to demonstrate and show their parts in a way that they would look in actual production. For example, anything that is polypropylene like milky white color is very important to engineers. Certain ABS like white and gray colors are very important to engineers and designers. If you look at the Accura 60 that we just introduced earlier this week, it looks just like the color of polycarbonate. So, colors are important to design engineers for two reasons. It mimics the actual attributes of the plastics that they’re looking for and it also in some instance enable them to look and see the fine detail features that these printers are able of delivery.

當然。當然。好問題。對我們來說，當我們談論顏色時，我們談論的是純色。我相信您提到的另一家公司有能力提供多種顏色，這是一個不同的切片；如果你願意的話，這是一個不同的觀眾。對於我們來說，提供顏色的能力使用戶能夠以更大的強度和更多的細節來查看零件。通常，所選的顏色（紅色和藍色）會突出並強化特徵細節，對於設計師和工程師在查看非常複雜的零件時非常重要。我們計劃繼續擴大顏色供應，也是因為某些顏料顏色允許工程師以實際生產中的樣子展示和展示他們的零件。例如，任何聚丙烯（如乳白色）對工程師來說都非常重要。某些 ABS（如白色和灰色）對於工程師和設計師來說非常重要。如果你看看我們本週早些時候剛推出的 Accura 60，它看起來就像聚碳酸酯的顏色。因此，顏色對於設計工程師來說很重要，原因有二。它模仿了他們正在尋找的塑料的實際屬性，並且在某些情況下還使他們能夠查看和看到這些印表機能夠提供的精細細節特徵。

Okay. And I do have a question for Fred, if I may. How much of your current R&D expenditure is software development related? Can you quantify that in dollars or percentage terms, annually?

好的。如果可以的話，我確實有一個問題想問弗雷德。您目前的研發支出中有多少與軟體開發相關？您能每年以美元或百分比形式進行量化嗎？

The number escapes me right now. Let me dig into a footnote to see if we’ve disclosed that. I can’t remember the number off the top of my head. I’m sorry, Andrew.

我現在記不起這個數字了。讓我深入研究一下腳註，看看我們是否已經披露了這一點。我一時記不起這個數字。對不起，安德魯。

But you do expense all R&D costs right now? There’s no capitalization?’

但您現在確實支出了所有研發費用嗎？沒有大寫嗎？

There are some software costs that are capitalized. But then we turn around and amortize them over the subsequent one year period. So, there’s a very short lag on it. The accounting literature calls for the capitalization of that class of expenditure and so we comply with that, of course. But then amortize it pretty quickly.

有一些軟體成本是資本化的。但隨後我們轉而在接下來的一年內攤提它們。所以，它有一個很短的滯後。會計文獻要求將此類支出資本化，因此我們當然遵守這一點。但很快就能攤銷。

Okay. Thank you.

好的。謝謝。

Yes. I don’t believe that we have any multi year software [inaudible]. Okay. Next question, please.

是的。我不相信我們有任何多年軟體[聽不清楚]。好的。請下一個問題。

Your next question comes from the line of Mike [Marionachi] with [Magnanox] Capital.

您的下一個問題來自 Mike [Marionachi] 和 [Magnanox] Capital 的線路。

Hi, Fred. I appreciate you having the 10-Q available. That’s helpful. I’m just looking at the accounts receivable and the allowance. And the DSO has really ratcheted up the last couple of quarters, yet the allowance of the percentages comes down quite a bit. I’m just trying to understand how those two dynamics are sort of working in opposite directions?

嗨，弗雷德。感謝您提供 10-Q。這很有幫助。我只看應收帳款和備抵金。 DSO 在過去幾個季度確實有所提高，但百分比津貼卻下降了不少。我只是想了解這兩種動力是如何朝相反的方向發揮作用的？

Well, we look at the larger over 90 day past due accounts on an account by account basis. And based upon the facts and circumstances of each one of those, we take a reserve against it or do not. In conjunction with some of the growing pains that Abe alluded to, we had a couple of customers that decided to hold up payment until we got their machine full installed. And that accounts for a great deal of that increase. Because our transition between here and Rock Hill, we had transition in our customer service personnel and so we had a higher level of sales tax issues, which we’re working through. But there’s no need to reserve those, because if we don’t get a from the customer, we’ll get a refund from the state. So, we very carefully looked at that on a case-by-case basis and we also make a general allowance for smaller ones and we’ve been very consistent in that policy for the last several years.

好吧，我們逐一查看逾期超過 90 天的較大帳戶。根據每一項的事實和情況，我們採取或不採取保留措施。結合安倍提到的一些成長的煩惱，我們有幾個客戶決定推遲付款，直到我們完全安裝好他們的機器。這佔了成長的很大一部分。因為我們在這裡和羅克山之間進行了過渡，所以我們的客戶服務人員也進行了過渡，因此我們遇到了更高水準的銷售稅問題，我們正在解決這個問題。但沒有必要保留這些，因為如果我們沒有從客戶那裡得到，我們將從國家獲得退款。因此，我們根據具體情況非常仔細地研究了這一點，並且我們還為較小的企業提供了一般津貼，並且我們在過去幾年中一直非常一致地執行該政策。

All right. So, would you expect the AR then to be coming down in the next quarter?

好的。那麼，您預計 AR 會在下個季度下降嗎？

Yes.

是的。

Okay. So, are we targeting back towards the sort of 60’ish day level?

好的。那麼，我們的目標是回到 60 天左右的水平嗎？

Or less.

或更少。

Yes. We have aggressive targets for accounts receivables and we believe that those, as we demonstrated in the past, those targets are achievable. From time to time we make certain transitional allows, as our business model shifts a little or as our organization shifts and in this particular quarter, I think both elements conspired to somewhat inflate our days sales outstanding.

是的。我們對應收帳款設定了積極的目標，我們相信，正如我們過去所證明的那樣，這些目標是可以實現的。隨著我們的業務模式發生一些變化或隨著我們的組織發生變化，我們會不時地做出某些過渡性的允許，在這個特定的季度，我認為這兩個因素共同在一定程度上誇大了我們的銷售額。

Okay. All right.

好的。好的。

Our allowance did increase a little bit during the first quarter.

第一季我們的津貼確實增加了一點。

Right. I’m just looking at it on a percentage basis over the last say two years.

正確的。我只是按過去兩年的百分比來看。

Okay.

好的。

All right. Thanks very much.

好的。非常感謝。

Your next question comes from the line of Bill Gibson with Nollenberger Capital.

您的下一個問題來自比爾吉布森 (Bill Gibson) 與諾倫伯格資本 (Nollenberger Capital) 的對話。

Just one question and that relates to the field engineering resource restraints that we experienced in the quarter. And you talk about having plans in place. But does that mean we should expect gross margins to be impacted in the second quarter, as well from this?

只有一個問題與我們在本季經歷的現場工程資源限制有關。你談到製定計劃。但這是否意味著我們應該預期第二季的毛利率也會受到影響？

It’s hard to tell, Bill, exactly at what point in time we fully transition and outgrow the growth pains, if you will. Because that largely depends on our continued success with placing the core complex and sophisticated assistance. There are a couple of things that we are going to do differently. We’re going, for example, to spend more time with customers up front, prior to the installation because we discovered that unlike our legacy systems that to a large extent, also went to existing customers that were already familiar with the technology. The new systems, even when they go to existing customers, require more extensive training on the part of the customer and [inaudible]. So, we plan to do that ahead of installation, in a contained facility. We plan to also similarly do a lot more to train and skill our own engineers because while on the surface it appears that [inaudible] lithography and selective laser [inaudible] here sometimes it’s the analog of taking a pilot who flies original jet and ask them to fly a 747.

比爾，如果你願意的話，很難說清楚我們在什麼時間點完全過渡並擺脫成長的痛苦。因為這在很大程度上取決於我們在提供核心複雜和精密援助方面的持續成功。我們要做一些不同的事情。例如，在安裝之前，我們將在安裝之前花更多時間與客戶溝通，因為我們發現，與我們的舊系統不同，它在很大程度上也適用於已經熟悉該技術的現有客戶。新系統即使交付給現有客戶，也需要客戶進行更廣泛的培訓並且[聽不清楚]。因此，我們計劃在安裝之前在封閉的設施中進行此操作。我們也計劃做更多類似的事情來培訓和培養我們自己的工程師，因為雖然從表面上看，[聽不清楚]光刻和選擇性雷射[聽不清楚]有時就像是讓駕駛原始噴氣式飛機的飛行員詢問他們駕駛 747。

So, we underestimated a little bit the training and learning curve, both on the parts of our own engineers and on the parts of our own customers. And that plan is in place. How quickly it becomes effective and at one point do the lines cross over, also largely depends on how many systems we sell in the coming quarters. Because to a large extent what happened to us is we became somewhat victims of our own success.

因此，我們有點低估了我們自己的工程師和我們自己的客戶的培訓和學習曲線。該計劃已經到位。它生效的速度有多快以及線路在某一時刻交叉的速度也很大程度上取決於我們在未來幾季銷售的系統數量。因為在很大程度上，發生在我們身上的事情是我們成為了自己成功的受害者。

Got it. Thanks, Abe.

知道了。謝謝，阿部。

You bet.

你打賭。

Your next question comes from the line of Matt Hewitt with Craig-Hallum.

你的下一個問題來自馬特·休伊特和克雷格·哈勒姆的對話。

Yes. My question is regarding the indirect channel you had mentioned that you had added. Was that the 85 reseller locations during the quarter? And I was just curious if they were productive and how long it takes for them to gain momentum?

是的。我的問題是關於您提到的添加的間接管道。這是本季的 85 個經銷商地點嗎？我只是好奇他們是否富有成效以及他們需要多長時間才能獲得動力？

Typically, adding new resellers takes several months to get them to the point of productivity. It takes its time every quarter, obviously to prospect and put new resellers onboard. I remember in connection with the end of last year, we said that we finished the year with some 70 resellers, so when you quote the higher numbers now, this is only the incremental growth. And also bear in mind that a new reseller doesn’t become productive overnight. We set them up; we train them on how to sell. We train them on how to install and then we go out and make additional sales calls with them to teach them how to do it. And so, the learning curve is probably several months.

通常，增加新經銷商需要幾個月的時間才能讓他們達到生產力水準。每個季度都需要時間，顯然是為了尋找和引進新的經銷商。我記得去年年底時，我們說過今年年底我們有大約 70 家經銷商，所以當你現在引用更高的數字時，這只是增量增長。還要記住，新經銷商不可能一夜之間變得有生產力。我們設置它們；我們培訓他們如何銷售。我們培訓他們如何安裝，然後我們出去與他們進行額外的銷售電話，教他們如何安裝。因此，學習曲線可能需要幾個月的時間。

Great. Thank you.

偉大的。謝謝。

Your next question comes from the line of [Jim Bartlett] with [Bartlett Investors].

您的下一個問題來自 [Jim Bartlett] 和 [Bartlett Investors] 的對話。

Yes. Could you explain to me how you really differentiate your 3-D printers from the competition and also, maybe review why you selected the 2-D printing and plotting channels, as opposed to the channel that others are using?

是的。您能否向我解釋一下您的 3D 列印機如何真正從競爭對手中脫穎而出，也許回顧一下為什麼您選擇 2D 列印和繪圖通道，而不是其他人正在使用的通道？

Sure. A couple of things. One is we have what we call a multi-jet printing capability. If you compare it to other competitors, only one other competitors, the [Objes Eden] has a similar technology. In the case of the [inaudible] dimension, it’s a single nozzle print capability. By comparison, we have more than 600 jets that jet material at the same time. So, what we can do as we get higher [inaudible], higher accuracy and the ability to process different materials, including our ability to also process sacrificial patterns for investment casting and precious metal casting. We have a family now of four 3-D printers, ranging in price from just under $15,000 to nearly $100,000. The LD, which is priced just under $15,000 is a desktop additive lamination process. It’s not a jetting process. And it’s ideal as an entry-level desktop device for engineers, marketers, purchasing agents and it’s particularly a very attractive offering to educational institutions, including middle schools and high schools, which will becoming an interesting segment.

當然。有幾件事。一是我們擁有所謂的多噴頭列印能力。如果你將它與其他競爭對手進行比較，只有一個其他競爭對手，[Objes Eden]擁有類似的技術。對於[聽不清楚]尺寸，它是單噴嘴列印能力。相比之下，我們有 600 多個同時噴射材料的噴嘴。因此，當我們獲得更高的[聽不清楚]、更高的精度和處理不同材料的能力時，我們可以做些什麼，包括我們處理熔模鑄造和貴金屬鑄造的犧牲模型的能力。我們現在擁有四台 3D 列印機，價格從略低於 15,000 美元到近 100,000 美元不等。 LD 的價格略低於 15,000 美元，是一種桌面增材層壓工藝。這不是噴射過程。對於工程師、行銷人員、採購代理商來說，它是理想的入門級桌面設備，對於包括初中和高中在內的教育機構來說，它尤其是一個非常有吸引力的產品，這將成為一個有趣的細分市場。

In the [inaudible] we have the [inaudible] resolution InVision, which is priced at $39,900 and then we go into the HR, the high resolution and the Dental Pro. Those are systems that go primarily into precious metal or investment casting applications. We chose the 2-D printing channel because we believe that as we push this technology closer to desktop utility, the devices that we will want to either replace and displace outright, and or compliment, would be wide format printers in 2-D plotters. And we felt that by going to more established, stable, experienced reseller organizations, the folks who are selling for HP and Xerox and [inaudible] and others, a, we would benefit from their much more robust infrastructure. B, we would benefit from their exceptional sales training and service capabilities. And these people would know where all the prospects are because presumably they have the relationships already with all current users of 2-D plotters and wide format printers.

在[聽不清楚]中，我們有[聽不清楚]解析度的InVision，售價為39,900美元，然後我們進入HR、高解析度和Dental Pro。這些系統主要用於貴金屬或熔模鑄造應用。我們選擇二維列印頻道是因為我們相信，隨著我們將這項技術推向桌面實用程序，我們想要完全替換和取代或補充的設備將是二維繪圖儀中的寬幅印表機。我們認為，透過轉向更成熟、穩定、經驗豐富的經銷商組織，即為惠普和施樂以及[聽不清楚]和其他公司進行銷售的人員，a，我們將從他們更強大的基礎設施中受益。 B，我們將受益於他們卓越的銷售培訓和服務能力。這些人會知道所有的潛在客戶在哪裡，因為他們可能已經與所有當前的二維繪圖儀和寬幅印表機使用者建立了關係。

Thank you.

謝謝。

Your next question comes from the line of [Julian Allen] with [Canal] Capital.

你的下一個問題來自 [Julian Allen] 與 [Canal] Capital 的對話。

Hi, good morning. My questions are on the working capital side and I apologize if I missed the comments at the start of the call. If I have this right, days of [inaudible] inventory of about 76 days were up almost a month over the prior year and up sequentially. Could you comment on that a little bit? And whether that’s due to some of the transitional issues or what your targets are for the coming quarters?

早安.我的問題是關於營運資金方面的，如果我錯過了電話會議開始時的評論，我深表歉意。如果我沒說錯的話，[聽不清楚] 庫存天數約為 76 天，比前一年增加了近一個月，並且比上年增加了近一個月。你能對此發表一點評論嗎？這是否是由於一些過渡性問題或您未來幾季的目標？

It is due to transitional issues, both for the roll out of new products and getting our supply chain running smoothly for the new lines. And it’s also up because of transition and in preparation for the outsourcing with UPS.

這是由於過渡問題，既是為了推出新產品，也是為了讓我們的新生產線的供應鏈順利運作。它的上升也是因為過渡和準備與 UPS 外包。

Julian, it’s a combination. I mean, I [inaudible] transition in the portfolio. We have added some 30 new products in the last 24 months. We have not yet pruned corresponding products out of the equation. And so, we are carrying many more products today in the [inaudible] than we did in previous periods. So, some of that is impacting. Secondly, in preparation for UPS, we upped our stock quite a bit to make sure that we didn’t have any unintended business interruptions. And also in connection, we’re working with so many outsource assembly suppliers today, do the lumpy nature of some of our businesses and the cost efficiencies of building systems in certain lot sizes, we decided to invest in some inventory in the last few periods to make sure we don’t experience any unintended business interruptions.

朱利安，這是一個組合。我的意思是，我[聽不清楚]在投資組合中進行轉變。在過去 24 個月內，我們增加了約 30 種新產品。我們還沒有從等式中刪除相應的產品。因此，我們今天在[聽不清楚]中攜帶的產品比以前多得多。所以，其中一些是有影響的。其次，為了準備 UPS，我們大幅增加了庫存，以確保我們不會有任何意外的業務中斷。此外，我們今天正在與如此多的外包組裝供應商合作，考慮到我們一些業務的不穩定性質以及在某些批量規模下構建系統的成本效率，我們決定在過去幾個時期投資一些庫存確保我們不會遇到任何意外的業務中斷。

If that’s all right, I’ll give Fred a call just to follow up. Thank you.

如果可以的話，我會打電話給 Fred 進行跟進。謝謝。

You have a follow up question from the line of Dennis Wassung with Canaccord Adams.

您有一個來自 Dennis Wassung 和 Canaccord Adams 的後續問題。

Thanks. Just a quick follow up here. On some of the field support actions you’re taking and some of the details you talked about earlier, are you intending to add headcount here and is it anything that’s substantial? And I’m curious if there was a revenue impact, if you can quantify it all in Q1? I know you mentioned some comments about that earlier. And sort of related, you talked about the backlog in the press release coming down sequentially and I’m wondering if there’s any correlation or any relationship to this? Was the fact that if you couldn’t take as much revenue, why did the backlog come down? And just trying to understand the dynamics there, if there are any. Thank you.

謝謝。這裡只是快速跟進。關於您正在採取的一些現場支援行動以及您之前談到的一些細節，您是否打算在這裡增加人員數量？這是否是實質的？我很好奇是否會對收入產生影響，您是否可以在第一季將其全部量化？我知道您之前提到過一些對此的評論。與此相關的是，您談到新聞稿中的積壓工作按順序下降，我想知道與此是否有任何關聯或關係？事實上，如果你不能獲得盡可能多的收入，為什麼積壓訂單會減少？只是想了解那裡的動態（如果有的話）。謝謝。

Let me start and maybe Fred can finish. With regards to our field service operations, we would have to assess -- I mean, in some instances we reduced headcounts in the last few periods and we may need to backfill it in a few instances. And those would be on a [inaudible] region and a territory basis, as required. And that would only happen, Dennis, after we convince ourselves that there is a long-term bona fide employment opportunity in a particular region. And that it’s not just related to any short term growth pains. And so, we’re going to look at that territory by territory and region and region and do what’s right for business and what’s accretive for the business.

讓我開始吧，也許弗雷德可以完成。關於我們的現場服務運營，我們必須評估 - 我的意思是，在某些情況下，我們在過去幾個時期減少了人員數量，並且在某些情況下我們可能需要回填。根據需要，這些將在[聽不清楚]地區和領土的基礎上進行。丹尼斯，只有在我們說服自己某個特定地區存在長期的、真正的就業機會之後，這種情況才會發生。這不僅與任何短期的成長陣痛有關。因此，我們將按地區、地區和地區來審視該地區，並做適合業務的事情以及對業務有利的事情。

With regards to the backlog and taking revenue. When we talked about foregoing revenue, we didn’t talk about backlog related revenue. We talked about foregone time and material, ordinary course service revenue that we could not necessarily attend to and some of our field engineering resources were tied to longer installations. That was the foregone revenue that we were discussing.

關於積壓和所得。當我們談論前述收入時，我們沒有談論積壓相關收入。我們討論了放棄的時間和材料、我們不一定能夠參與的普通課程服務收入，以及我們的一些現場工程資源與較長的安裝相關聯。這就是我們正在討論的放棄的收入。

Dennis, that also raised its head though in terms of delaying and the initiative of our recognition of warranty revenue. We start that when a system is commissioned and because of some late commissioning, warranty revenue normally would expect to commence in the first quarter, commenced very late in the quarter and also recognition of some installation revenue, similarly was either late in the quarter or even deferred until the second.

丹尼斯，在延遲和我們確認保固收入的主動性方面，這也引起了人們的注意。我們開始，當系統調試時，由於調試較晚，保固收入通常預計在第一季度開始，在本季度很晚開始，並且還確認了一些安裝收入，同樣是在本季度末甚至是推遲到第二次。

Now, generally speaking, when it comes to backlog, bear in mind and we’ve said this all along, that even the $2.8 million that we entered in the second quarter with, it’s still a much higher backlog than what this business would have experienced in the ordinary course until, I believe, the third quarter of last year. Is that right, Fred?

現在，一般來說，當談到積壓時，請記住，我們一直在說這一點，即使我們在第二季度投入了 280 萬美元，它仍然比該業務所經歷的積壓要高得多我相信，這種情況一直持續到去年第三季。是這樣嗎，弗雷德？

Yes.

是的。

Yes.

是的。

Okay. So just to clarify, it sounds like the revenue issues you had, there was no system revenue that fell out because of your inability to install or service those machines; is that correct?

好的。因此，澄清一下，這聽起來像是您遇到的收入問題，沒有因為您無法安裝或維修這些機器而導致系統收入下降；那是對的嗎？

That’s correct.

這是正確的。

That’s correct.

這是正確的。

Okay. Great. And the backlog that you talk about, the $2.8 million, is that predominantly systems backlog or does that include services?

好的。偉大的。您所說的 280 萬美元的積壓，主要是系統積壓還是包括服務？

That’s entirely systems.

這完全是系統。

Okay. Great. Thanks, that helps.

好的。偉大的。謝謝，這有幫助。

You have a follow up question from the line of Andy Schopick with Nutmeg Securities.

您有來自 Nutmeg Securities 的 Andy Schopick 的後續問題。

Yes. I just want to ask on the 3-D Printing side, in terms of the strategy here and penetrating the market. You are kind of coming from behind the position of trying to catch up to a leader of [Stratosys] in this market. I wonder to what extent the Company has kind of flushed out its selling and marketing strategy? Whether it will be using any types of marketing or sales initiatives, such as the kind of sales demo programs that Adesys has used? Or anything of that manner to try to affect a quicker, stronger penetration of the 3-D printing market?

是的。我只想問一下3D列印方面的策略和市場滲透方面的問題。您有點後來居上，試圖追趕這個市場的領導者 [Stratosys]。我想知道該公司在多大程度上製定了其銷售和行銷策略？是否會使用任何類型的行銷或銷售舉措，例如 Adesys 使用的銷售簡報程式？或採取任何類似的方式來嘗試更快、更強地滲透 3D 列印市場？

It’s a good question, Andrew and thank you for asking it. We are certainly a newcomer or a later comer into this arena. I’m not sure that we are in a race to catch up to Stratosys. We have been very deliberate in what we are targeting with our printers, recognizing that we are newcomers and we are targeting, in addition to the general purpose market, which is where Stratosys plays [inaudible] quite ably. We’re targeting certain applications that today are highly profitable and largely unopposed. For example, our ability to target jewelry design and manufacturing is a very interesting switch spot because we have wax like materials that could be printed into patterns and go into the precious metal casting. Our recent entry into the dental arena, for dental wax ups for [inaudible] is another such opportunity where we in essence sell an integrated system into a dental lab manufacturing environment. On the other hand, printers like the standard resolution InVision and the LD, are geared at the general purpose market and there we are going to market targeting the 2-D plotting and printing resellers and these resellers, as part of their activities, will make the necessary investments in demo equipment and what have you. What we do not do is we do not force our resellers to take machines into inventory and to then finance that inventory over time. We don’t think that that’s a formula for success.

這是一個很好的問題，安德魯，謝謝你提出這個問題。我們當然是這個領域的新手或後來者。我不確定我們是否正在與 Stratosys 競爭。我們對印表機的目標進行了深思熟慮，並認識到我們是新來者，除了通用市場之外，我們的目標也是 Stratosys 發揮[聽不清楚]的能力。我們的目標是某些如今利潤豐厚且基本上無人反對的應用程式。例如，我們針對珠寶設計和製造的能力是一個非常有趣的轉變點，因為我們擁有類似蠟的材料，可以將其印成圖案並用於貴金屬鑄造。我們最近進入牙科領域，為[聽不清楚]提供牙科蠟型，這是另一個這樣的機會，我們本質上是在牙科實驗室製造環境中銷售整合系統。另一方面，像標準解析度 InVision 和 LD 這樣的印表機面向通用市場，我們將針對 2D 繪圖和列印經銷商進行行銷，而這些經銷商作為其活動的一部分，將製作對演示設備的必要投資以及您擁有的東西。我們不做的是，我們不強迫我們的經銷商將機器納入庫存，然後隨著時間的推移為庫存提供資金。我們認為這不是成功的秘訣。

Finally, let me say, Andrew, that for us, this is only the opening round and we look at this as a very exciting and a very interesting growth opportunity. And as we alluded to earlier this morning, and in previous discussions, we’re making additional significant investments and we intend on introducing additional compact, affordable desktop printers. As we push the envelope on this technology that we hope will redefine the available market, the audience and by default, it will take care of who’s in a leadership position and who isn’t.

最後，安德魯，我想說，對我們來說，這只是首輪，我們認為這是一個非常令人興奮和非常有趣的成長機會。正如我們今天早上早些時候以及之前的討論中提到的，我們正在進行額外的重大投資，並打算推出更多緊湊、價格實惠的桌上型印表機。當我們挑戰這項技術的極限時，我們希望它能夠重新定義可用市場、受眾，並且在預設情況下，它將照顧到誰處於領導地位，誰不處於領導地位。

Thank you. I just wonder what percentage of your 3-D printer sales last year came from the international market, outside North America?

謝謝。我只是想知道去年你們的 3D 列印機銷售額中有多少來自北美以外的國際市場？

I couldn’t tell you that off the top of my head. But my guess would be that to a large extent that it would be somewhat mirror what happens with the rest of the business.

我無法立即告訴你這一點。但我的猜測是，這在很大程度上會反映其他業務的情況。

Okay. Thank you.

好的。謝謝。

At this time, there are no further questions.

目前，沒有其他問題了。

Ladies and gentlemen, if there are no further questions, we will now close the call. Thank you for joining us today. We look forward to continuing to report our progress and results. A replay of this web cast will be made available two hours after the call on 3D System’s website under the Investor Relations section.

女士們先生們，如果沒有其他問題，我們現在結束通話。感謝您今天加入我們。我們期待繼續報告我們的進展和結果。電話會議兩小時後，將在 3D System 網站的投資者關係部分重播該網路廣播。

Thank you all and have a great day.

謝謝大家，祝您有美好的一天。

This concludes today’s conference call and you may now disconnect.

今天的電話會議到此結束，您現在可以掛斷電話了。