3D SYSTEMS REVENUE DOWN 6% IN Q2.Byline: Nicholas Grudin Staff Writer VALENCIA - A day after the resignation of its chief executive, 3D Systems Corp. announced Tuesday that second-quarter revenues were down 6 percent from the same period last year. Company officials blame the decline largely on an extensive internal audit into accounting irregularities that cost the company $1.4 million and led to the departure of three top executives. Since April, the Valencia-based company has lost its chief executive, chief financial and chief operating officers Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. in the wake of an accounting scandal. In the quarter that ended June 27, revenues were $26.9 million, compared with $28.5 million in the same period of 2002. ``A decrease in revenues principally resulting from the continuing downturn in capital expense purchasing, combined with the time, attention, and costs required by the Audit Committee's investigation and the need to obtain additional finances severely strained our resources,'' said G. Walter Loewenbaum II, chairman of the Board of Directors. In April, 3D Systems ousted CFO See Chief Financial Officer. James Selzer and in May the company demoted chief operating officer Grant Flaharty. Monday, CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Brian Service resigned. Severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when payments also contributed to the decline in second-quarter earnings, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. a company press release. The front office departures came after an audit revealed that $3 million in earnings had been counted for 2002 instead of 2003. Without those revenues, the company was below profitability for 2002. ``The past six months have been a very difficult period for our company,'' Loewenbaum said. But 3D Systems also enjoyed some promising signs in the quarterly report. Gross profit margins Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. rose 2 percent, reflecting improved materials margins, according to the company release. And total operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. decreased 36 percent, from $19.3 million in the second quarter of 2002 to $12.5 million during the same period of 2003. Shares of 3D Systems stock dropped 6 percent Monday after Service's resignation was announced. Tuesday, the price remained relatively even at about $8 per share. ``We begin the second half of the year with the decks cleared, ready to move forward throughout the remainder of 2003 and into 2004,'' Loewenbaum said. |
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