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Dassault Systèmes Reports Strong Fourth Quarter Software Revenue Growth on Acceleration of 3DEXPERIENCE AdoptionRegulatory News: Dassault Systèmes (Euronext Paris: #13065, DSY.PA), the 3DEXPERIENCE Company, world leader in 3D design software, 3D Digital Mock Up and Product Lifecycle Management (PLM) solutions, today announced IFRS unaudited financial results for the fourth quarter and year ended December 31, 2015. These results were reviewed by the Company's Board of Directors on February 3, 2016.
Summary Highlights
*In constant currencies "Companies are going through deep transformations in terms of products, content, services, and business models," commented Bernard Charlès, Dassault Systèmes President and Chief Executive Officer. "Our clients' results with 3DEXPERIENCE are demonstrating the significant business value it can bring to help them respond to these complex challenges and achieve their targeted objectives. "We have remarkable examples of what is possible. Our 'Virtual Singapore' engagement demonstrates the capability to represent and simulate an entire city - involving integrating and giving meaning to big data on the enormous scale which a city represents. We also see customers designing complete planes on the Cloud thanks to the robustness and power of our 3DEXPERIENCE Cloud solutions, something that would have been unthinkable just a few years ago. "Our 3DEXPERIENCE industry solutions and platform are delivering strong business value for our customers because they enable a tight connection of product innovation, simulation and manufacturing, and help to monitor and achieve business targets. And 3DEXPERIENCE industry solutions, on premise or on the Cloud, work equally well for the largest OEMS, mid-sized companies and start-ups. "In summary, we were pleased to see strong growth in 3DEXPERIENCE adoption, which was quite visible in the acceleration of 3DEXPERIENCE sales during the fourth quarter, contributing to a strong finish to the year and attainment of all our objectives. Looking forward, we want to continue to invest to be able to support our clients' transformations as they work to reveal what is possible when we all look at the world with new eyes."
*In constant currencies
*In constant currencies
Cash Flow and Other Financial Highlights Net operating cash flow was €103.0 million and €633.3 million for the fourth quarter and the year ended December 31, 2015, respectively, compared to €54.8 million and €499.5 million in the respective 2014 periods. In 2015 and 2014 changes in working capital included the payment of €60 million and €22 million, respectively, in connection with ongoing tax proceedings. For the year ended December 31, 2015, the Company uses of cash were principally for cash dividends of €98.4 million, capital expenditures of €43.6 million, share repurchases of €28.3 million and payment for acquisitions of €20.2 million, net of cash acquired. The Company received cash of €650 million in connection with a new five year credit facility entered into in October, 2015 and fully drawn down, and for stock options exercised of €35.9 million. At December 31, 2015, the Company's net financial position totaled €1.35 billion, compared to €825.5 million at December 31, 2014, reflecting an increase in cash, cash equivalents and short-term investments to €2.35 billion, and an increase in long-term debt to €1.00 billion, compared to respective amounts of €1.18 billion and €350.0 million at December 31, 2014. Summary of Recent Business, Technology and Customer Highlights Customers On January 13, 2016, the Company announced that Electric-Car Company Faraday Future Is Deploying Dassault Systèmes' 3DEXPERIENCE Platform for Breakthrough Automotive Experience. Based on the 3DEXPERIENCE platform, "Target Zero Defect" and "Smart Safe & Connected" industry solution experiences were fully deployed across the company of more than 400 employees worldwide within two weeks. It has enabled Faraday Future to design, simulate, and prepare for production in ways that were not possible with any other solution. The 3DEXPERIENCE platform will also be utilized in Faraday Future's forthcoming manufacturing facility in North Las Vegas. Dassault Systèmes' industry solution experiences for manufacturing, including "Lean Production Run," are used by companies like Faraday Future for plant optimization, quality control, and real-time visibility into facility operations. On December 3, 2015 Dassault Systèmes announced that General Mills France, a subsidiary of General Mills, one of the world's leading food companies, is deploying the "Perfect Shelf" industry solution experience to engage in new merchandising strategies for its Häagen-Dazs premium brand of ice cream. In a product category driven by impulse purchases, "Perfect Shelf" enables General Mills France to better collaborate with retailers, enhance the consumer shopping experience and accelerate brand growth. On November 25, 2015, the Company announced that Mammut Sports Group, an international outdoor apparel and equipment brand manufacturer, is deploying Dassault Systèmes' "My Collection" industry solution experience to streamline collection planning and control brand identity. Mammut, founded 150 years ago in Switzerland and now with seven subsidiaries worldwide, specializes in alpine climbing ropes, clothing, shoes and accessories that combine technology with function for use in high altitudes as well as in day-to-day activities. In order to increase market reach of its premium brand positioning and keep strategic growth on track, the company sought a digital solution to control and execute the development of its summer and winter collections, designed in Switzerland and manufactured by third parties in Europe and Asia. In early November, Dassault Systèmes announced that POSCO, one of the world's largest steel producers, is using Dassault Systèmes' 3DEXPERIENCE platform for POSCO's virtual commissioning system and virtual training system to digitize and simulate its manufacturing operations, processes and equipment. The 3DEXPERIENCE platform enables customers in the process industry to connect, model, simulate and optimize every stage of the business cycle to create a virtual twin experience fully connected with their physical assets to improve safety, efficiency, profitability and sustainability. Other Corporate Events It was recently announced that Dassault Systèmes has been ranked second by Corporate Knights in the 2016 Top 100 Most Sustainable Corporations in the World (Global 100) index. The Company moved up from 17th place in 2015 and is the highest ranked technology company. This is the fifth consecutive year that Dassault Systèmes has been included in the index. The Corporate Knights Global 100 index is recognized globally as the gold standard for corporate sustainability analysis. Rankings are based on the evaluation of a number of key performance indicators (KPIs) including environmental, social, financial and innovation capacity. On November 18, 2015, Netvibes won Appsters Award for "Best IoT Development 2015". The Appsters are a prestigious, annual awards program that recognizes excellence in the apps industry. The winners in each category were decided by a global judging panel of 32 experts and honored in London at the Apps World Conference. In the category of "Best IoT Development," Netvibes was named the top winner from a strong field of competitors. On November 9, 2015, Dassault Systèmes Unveiled the 3DEXPERIENCE Lab, its Open Innovation Laboratory and Startup Accelerator Program where Dassault Systèmes will help selected startups that are developing physical products capable of improving life, cities and lifestyles, covering ideation, the Internet of Things, up to fab lab movements. With the 3DEXPERIENCE Lab, Dassault Systèmes embraces the concept of the social enterprise and will draw upon its 34 years of expertise in virtual technologies to shape a new framework of open innovation for a more sustainable world. On November 9, 2015, Dassault Systèmes announced that it has established La Fondation Dassault Systèmes, its foundation dedicated to helping transform the future of education and research by harnessing the powerful learning and discovery capabilities of 3D technology and virtual universes. La Fondation Dassault Systèmes will provide grants, digital content and skillsets in virtual technologies to empower innovative and transformative projects in education and research initiatives at academic institutions, research institutes, museums, associations, cultural centers and other general interest organizations throughout the European Union. Business Outlook Thibault de Tersant, Senior Executive Vice President, CFO, commented, "We completed the year with a strong fourth quarter driven by an acceleration of 45% in 3DEXPERIENCE software revenue. Looking at 2015 in total, we delivered new licenses revenue growth of 11% and non-IFRS operating margin expansion of 120 basis points, both on an organic basis and excluding currency benefits. Our performance was broad-based, well-balanced across regions, and with our industry results reflecting a strong level of activity in a number of our core and diversification industries. "We are initiating our financial objectives for 2016, with double-digits organic new licenses revenue growth for a third year in a row, and total revenue growth of about 7%, both goals in constant currencies. We anticipate a more back-end loaded year based upon the environment. Looking at the first quarter, our financial objectives also reflect a strong year-ago comparison base. "Our 2016 financial objectives demonstrate a continued good dynamic across industries, brands and geographies. To further these dynamics and support the acceleration in adoption of 3DEXPERIENCE, we are increasing investments in key focus areas of research and development as well as in our sales channels. As a result of re-investing for the future, we are targeting to maintain our non-IFRS operating margin at about 31% for 2016." The Company's first quarter and full year 2016 financial objectives are as follows:
The Company's objectives are prepared and communicated only on a non-IFRS basis and are subject to the cautionary statement set forth below. The 2016 non-IFRS objectives set forth above do not take into account the following accounting elements and are estimated based upon the 2016 currency exchange rates above: deferred revenue write-downs estimated at approximately €2 million, share-based compensation expense, including related social charges, estimated at approximately €62 million and amortization of acquired intangibles estimated at approximately €147 million. The above objectives do not include any impact from other operating income and expense, net principally comprised of acquisition, integration and restructuring expenses. Finally, these estimates do not include any new stock option or share grants, or any new acquisitions or restructurings completed after February 4, 2016. Today's Webcast and Conference Call Information Today, Thursday, February 4, 2016, Dassault Systèmes will first host a meeting in Paris, which will be simultaneously webcasted at 9:30 AM London time/10:30 AM Paris time and will then also host a conference call at 9:00 AM New York time/ 2:00 PM London time/3:00 PM Paris time. The webcasted meeting and conference call will be available via the Internet by accessing http://www.3ds.com/investors/. Please go to the website at least 15 minutes prior to the webcast or conference call to register, download and install any necessary audio software. The webcast and conference call will be archived for one year. Additional investor information can be accessed at http://www.3ds.com/investors/ or by calling Dassault Systèmes' Investor Relations at 33.1.61.62.69.24. Key Investor Relations Events
First Quarter Earnings, April 21, 2016 Forward-looking Information Statements herein that are not historical facts but express expectations or objectives for the future, including but not limited to statements regarding the Company's non-IFRS financial performance objectives, are forward-looking statements. Such forward-looking statements are based on Dassault Systèmes management's current views and assumptions and involve known and unknown risks and uncertainties. Actual results or performances may differ materially from those in such statements due to a range of factors. The Company's current outlook for 2016 takes into consideration, among other things, an uncertain global economic environment. In light of the continuing uncertainties regarding economic, business, social and geopolitical conditions at the global level, the Company's revenue, net earnings and cash flows may grow more slowly, whether on an annual or quarterly basis. While the Company makes every effort to take into consideration this uncertain macroeconomic outlook, the Company's business results, however, may not develop as anticipated. Furthermore, due to factors affecting sales of the Company's products and services as described above, there may be a substantial time lag between an improvement in global economic and business conditions and an upswing in the Company's business results. In preparing such forward-looking statements, the Company has in particular assumed an average US dollar to euro exchange rate of US$1.10 per €1.00 for the 2016 first quarter and US$1.14 per €1.00 for the full year as well as an average Japanese yen to euro exchange rate of JPY130.0 to €1.00 for the first quarter and full year; however, currency values fluctuate, and the Company's results of operations may be significantly affected by changes in exchange rates. The Company's actual results or performance may also be materially negatively affected by numerous risks and uncertainties, as described in the "Risk Factors" section of the 2014 Document de Référence, filed with the AMF on March 24, 2015, and also available on the Company's website www.3ds.com. Non-IFRS Financial Information Readers are cautioned that the supplemental non-IFRS financial information presented in this press release is subject to inherent limitations. It is not based on any comprehensive set of accounting rules or principles and should not be considered as a substitute for IFRS measurements. Also, the Company's supplemental non-IFRS financial information may not be comparable to similarly titled non-IFRS measures used by other companies. Further specific limitations for individual non-IFRS measures, and the reasons for presenting non-IFRS financial information, are set forth in the Company's annual report for the year ended December 31, 2014 included in the Company's 2014 Document de Référence filed with the AMF on March 24, 2015. In the tables accompanying this press release the Company sets forth its supplemental non-IFRS figures for revenue, operating income, operating margin, net income and diluted earnings per share, which exclude the effect of adjusting the carrying value of acquired companies' deferred revenue, share-based compensation expense and related social charges, the amortization of acquired intangible assets, other operating income and expense, net, certain one-time items included in financial revenue and other, net, and the income tax effect of the non-IFRS adjustments and certain one-time tax effects. The tables also set forth the most comparable IFRS financial measure and reconciliations of this information with non-IFRS information. Information in Constant Currencies When the Company believes it would be helpful for understanding trends in its business, the Company provides percentage increases or decreases in its revenue (in both IFRS as well as non-IFRS) to eliminate the effect of changes in currency values, particularly the U.S. dollar and the Japanese yen, relative to the euro. When trend information is expressed herein "in constant currencies", the results of the "prior" period have first been recalculated using the average exchange rates of the comparable period in the current year, and then compared with the results of the comparable period in the current year. About Dassault Systèmes Dassault Systèmes, the 3DEXPERIENCE Company, provides business and people with virtual universes to imagine sustainable innovations. Its world-leading solutions transform the way products are designed, produced, and supported. Dassault Systèmes' collaborative solutions foster social innovation, expanding possibilities for the virtual world to improve the real world. The group brings value to over 200,000 customers of all sizes, in all industries, in more than 140 countries. For more information, visit www.3ds.com. CATIA, SOLIDWORKS, ENOVIA, DELMIA, SIMULIA, GEOVIA, EXALEAD, 3D VIA, 3DSWYM, BIOVIA, NETVIBES, 3DEXCITE are registered trademarks of Dassault Systèmes or its subsidiaries in the US and/or other countries. (Tables to Follow) TABLE OF CONTENTS Non-IFRS key figures Condensed consolidated statements of income Condensed consolidated balance sheets Condensed consolidated cash flow statements IFRS - non-IFRS reconciliation
DASSAULT SYSTEMES Non-IFRS key figures exclude the effects of adjusting the carrying value of acquired companies' deferred revenue, share-based compensation expense and related social charges, amortization of acquired intangible assets, other operating income and expense, net, certain one-time financial revenue items and the income tax effects of these non-IFRS adjustments and certain one-time tax effects. Comparable IFRS financial information and a reconciliation of the IFRS and non-IFRS measures are set forth in the separate tables within this Attachment.
*In constant currencies
*Variation compared to the same period in the prior year.
* The consolidated balance sheet as of December 31, 2014 has been restated to reflect the finalized purchase price allocation for prior year business combinations.
DASSAULT SYSTEMES Readers are cautioned that the supplemental non-IFRS information presented in this press release is subject to inherent limitations. It is not based on any comprehensive set of accounting rules or principles and should not be considered as a substitute for IFRS measurements. Also, the Company's supplemental non-IFRS financial information may not be comparable to similarly titled non-IFRS measures used by other companies. Further specific limitations for individual non-IFRS measures, and the reasons for presenting non-IFRS financial information, are set forth in the Company's Document de référence for the year ended December 31, 2014 filed with the AMF on March 24, 2015. To compensate for these limitations, the supplemental non-IFRS financial information should be read not in isolation, but only in conjunction with the Company's consolidated financial statements prepared in accordance with IFRS.
(1)In the reconciliation schedule above, (i) all adjustments to IFRS revenue data reflect the exclusion of the deferred revenue adjustment of acquired companies; (ii) adjustments to IFRS operating expense data reflect the exclusion of the amortization of acquired intangibles, share-based compensation expense and related social charges, and other operating income and expense, (iii) adjustments to IFRS financial revenue and other, net reflect the exclusion of certain one-time items included in financial revenue and other, net, and (iv) all adjustments to IFRS income data reflect the combined effect of these adjustments, plus with respect to net income and diluted net income per share, the income tax effect of the non-IFRS adjustments and certain one-time tax effects.
(2) The non-IFRS percentage increase (decrease) compares non-IFRS measures for the two different periods. In the event there is non-IFRS adjustment to the relevant measure for only one of the periods under comparison, the non-IFRS increase (decrease) compares the non-IFRS measure to the relevant IFRS measure. (3) Based on a weighted average 256.6 million diluted shares for Q4 2015 and 255.3 million diluted shares for Q4 2014.
DASSAULT SYSTEMES Readers are cautioned that the supplemental non-IFRS information presented in this press release is subject to inherent limitations. It is not based on any comprehensive set of accounting rules or principles and should not be considered as a substitute for IFRS measurements. Also, the Company's supplemental non-IFRS financial information may not be comparable to similarly titled non-IFRS measures used by other companies. Further specific limitations for individual non-IFRS measures, and the reasons for presenting non-IFRS financial information, are set forth in the Company's Document de référence for the year ended December 31, 2014 filed with the AMF on March 24, 2015. To compensate for these limitations, the supplemental non-IFRS financial information should be read not in isolation, but only in conjunction with the Company's consolidated financial statements prepared in accordance with IFRS.
(1)In the reconciliation schedule above, (i) all adjustments to IFRS revenue data reflect the exclusion of the deferred revenue adjustment of acquired companies; (ii) adjustments to IFRS operating expense data reflect the exclusion of the amortization of acquired intangibles, share-based compensation expense and related social charges, and other operating income and expense, (iii) adjustments to IFRS financial revenue and other, net reflect the exclusion of certain one-time items included in financial revenue and other, net, and (iv) all adjustments to IFRS income data reflect the combined effect of these adjustments, plus with respect to net income and diluted net income per share, the income tax effect of the non-IFRS adjustments and certain one-time tax effects.
(2) The non-IFRS percentage increase (decrease) compares non-IFRS measures for the two different periods. In the event there is non-IFRS adjustment to the relevant measure for only one of the periods under comparison, the non-IFRS increase (decrease) compares the non-IFRS measure to the relevant IFRS measure. (3) Based on a weighted average 256.6 million diluted shares for 2015 and 255.3 million diluted shares for 2014. View source version on businesswire.com: http://www.businesswire.com/news/home/20160203006577/en/ |
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