Nano Dimension Ltd. — FY2021 Form 20-F
Reporting period: Fiscal year ended December 31, 2021. This is an annual report, not a standalone Q4 filing; the supplied filing text does not provide clear Q4-only financial results. Figures below are in U.S. dollars unless noted. Financial statements use IFRS as issued by the IASB.
Business context and reporting period
Nano Dimension develops additive manufacturing systems for printed electronics, including its DragonFly IV printer, proprietary inks and FLIGHT software. In 2021 it expanded through acquisitions of DeepCube, NanoFabrica and Essemtec; Essemtec was consolidated from November. GIS was acquired in January 2022, after year-end. The company reported 36 systems sold worldwide over 2019–2021 combined and sold its first two DragonFly IV printers in December 2021.
Financial performance and liquidity
| Metric | FY2020 | FY2021 |
|---|---|---|
| Revenue | $3.399 million | $10.493 million |
| Gross profit | $1.065 million | $1.122 million |
| Operating loss | $35.697 million | $223.211 million |
| Loss for the year | $48.494 million | $200.824 million |
| Loss attributable to owners | $48.494 million | $200.777 million |
| Operating cash flow | $(9.646) million | $(42.579) million |
- Revenue rose 209%, primarily due to the November acquisition of Essemtec. Systems generated $7.250 million, consumables $1.631 million, support services $1.117 million and R&D services $0.495 million.
- Total cost of revenue was $9.371 million, including $3.641 million of acquired-intangible amortization. Gross margin was approximately 10.7% of revenue.
- R&D expense increased 322% to $41.686 million; sales and marketing rose 244% to $22.713 million. General and administrative expense declined 3% to $19.644 million.
- The company recorded a $140.290 million impairment charge after a decline in its share price led it to test cash-generating units. The charge covered goodwill, intangible assets and property, plant and equipment; the year-end carrying amount of intangible assets was zero.
- Net finance income was $17.481 million, versus net finance expense of $12.797 million in 2020, mainly reflecting fair-value remeasurement of financial liabilities. The company also reported a $4.906 million tax benefit.
- At year-end, cash and cash equivalents were $853.626 million and bank deposits were $501.969 million, totaling about $1.356 billion. Current assets were $1.312 billion against current liabilities of $31.996 million.
- Cash flows were $(42.579) million from operations, $(496.680) million from investing and $804.179 million from financing. Investing included bank deposits, fixed assets and acquisitions. Financing was mainly equity issuance. The cash flow statement shows a $264.920 million increase in cash before $3.368 million of foreign-exchange effects.
- Total liabilities were $45.724 million and equity was $1.344 billion. Reported obligations included $5.422 million of lease liabilities, $1.988 million of IIA grant liabilities and $18.257 million of fair-value financial liabilities, including warrants, share-price protection and acquisition contingent consideration. The filing does not indicate substantial conventional borrowings.
Material changes versus the prior comparable period
- Revenue increased from $3.399 million to $10.493 million, but gross profit rose only slightly, from $1.065 million to $1.122 million.
- Operating loss expanded substantially, chiefly due to the impairment charge and higher R&D and sales and marketing spending. Net loss increased from $48.494 million to $200.824 million.
- Operating cash use increased from $9.646 million to $42.579 million, while financing cash inflow was $804.179 million, primarily from share issuance.
- The company issued 74.1 million shares for cash during 2021 and 7.162 million shares as acquisition consideration; 257.386 million ordinary shares were outstanding at year-end. 2021 public offerings generated approximately $796.4 million net proceeds.
- Acquisitions materially broadened the business and increased integration, valuation and earn-out exposure. Acquired companies contributed $7.146 million of revenue included in the consolidated results, according to the auditor’s report.
Outlook, commentary, risks and unusual items
- Management said current resources were expected to meet business needs for at least the next 12 months and to support establishing commercial infrastructure. No quantified revenue, earnings or margin guidance is provided.
- The company had not achieved profitability and expected significant losses to continue until it generated substantial product revenue. Management planned continued investment in product development, materials, sales, marketing and manufacturing capacity.
- Key execution risks include limited commercial revenue, uncertain customer adoption and scaling, competition and rapid technological change, single-source suppliers and reliance on a single production facility.
- COVID-19 had disrupted supply chains, travel and customer spending; management described a recovery trend in 2021 but said future impacts remained uncertain. The company also cited foreign-exchange exposure, political and security risks in Israel, and acquisition integration risks.
- Research grants from Israel’s Innovation Authority carry royalties of 3%–3.5% on applicable product sales, as well as restrictions on transferring funded know-how or manufacturing outside Israel. The company reported $1.988 million of contingent grant liabilities at year-end.
- Acquisition commitments include Essemtec earn-outs tied to EBITDA and gross-profit targets, with $8.792 million recognized as contingent consideration at year-end. NanoFabrica’s contingent consideration was reduced to zero because management did not expect the targets to be met. GIS acquisition consideration and potential earn-outs arose after year-end.
- Management and the auditor concluded internal control over financial reporting was effective as of December 31, 2021, but controls at DeepCube, NanoFabrica and Essemtec were excluded from the assessment and audit.
- The auditor issued an unqualified opinion on the IFRS financial statements and internal controls. Impairment testing was identified as a critical audit matter because recoverable value depended on subjective assumptions, including a 20% discount rate, projected revenue growth and future EBITDA margins.
Most important facts for investors to verify
- How much of the 2021 revenue increase reflects recurring growth versus acquisitions, especially Essemtec’s partial-year contribution.
- Whether DragonFly IV and related consumables can generate materially higher sales and gross margins; the first two DragonFly IV systems were sold in December 2021.
- The assumptions and sensitivity underlying the $140.290 million impairment, including forecasts and the 20% discount rate.
- Cash and deposit availability, future operating cash burn, and the effect of acquisition spending and earn-outs on liquidity.
- Share dilution from equity financing, acquisition consideration, warrants and share-based compensation; confirm current share count and potential exercises.
- Performance conditions, amounts and timing of acquisition-related earn-outs, including Essemtec and GIS, and the status of IIA royalties and technology-transfer restrictions.
- The precise Q4 2021 results, which are not separately clear in the supplied filing text.