Net operating cash flow was €77 million and €526 million for the three and nine months ended September 30, 2016, respectively, compared to €113 million and €530 million for the 2015 comparable periods. Third quarter working capital evolution reflected an increase in tax downpayments and timing impacts of tax refunds.
The Company’s uses of cash for the 2016 nine-month period were principally for payment for acquisitions net of cash acquired of €245.9 million, cash dividends of €101.9 million, share repurchases of €52.5 million, and capital expenditures of €32.0 million. The Company received cash for stock options exercised of €15.9 million.
Dassault Systèmes’ net financial position totaled €1.46 billion at September 30, 2016, compared to €1.35 billion at December 31, 2015, reflecting an increase in cash, cash equivalents and short-term investments to €2.46 billion from €2.35 billion, with long-term debt of €1.00 billion.
Summary of Recent Business, Technology and Customer Highlights
Acquisitions
On October 3, 2016, Dassault Systèmes announced the completion of the acquisition of CST, the technology leader in electromagnetic (EM) simulation to offer full spectrum EM simulation of autonomous cars, connected homes, medical equipment, wearable electronics and other smart objects. Dassault Systèmes will integrate CST solutions into its portfolio of industry solution experiences based on the 3DEXPERIENCE platform to offer a new standard in multiphysics and multiscale simulation. CST STUDIO SUITE software is used by designers and engineers at more than 2,000 leading companies in the high-tech, transportation and mobility, aerospace and defense, and energy industries to evaluate all types of EM effects during every stage of electronic system design processes.
Customers
On September 29, 2016 Dassault Systèmes’ 3DEXPERIENCE Platform Reaches 10,000 Users at Groupe Renault. This marks a milestone in Groupe Renault’s “NewPDM” program based on Dassault Systèmes’ 3DEXPERIENCE platform, to transform its engineering division to make it global and collaborative, with “right the first time” product development. For this, Groupe Renault has deployed Dassault Systèmes’ virtual collaborative design and simulation applications across all of its engineering centers worldwide to bring its teams together for real-time collaboration on a single, unified platform, from concept through production. These applications now form the core of Dassault Systèmes’ “Target Zero Defect” industry solution experience.
On September 22, 2016 Dassault Systèmes’ announced that Geberit Group, a European leader in sanitary technology, is using the 3DEXPERIENCE platform to create a more collaborative global product development environment that will accelerate time to market. Geberit Group has 35 production facilities and over 12,000 employees in 40 countries.
On September 6, 2016 the Company announced that NAOS Ship and Boat Design (NAOS), a leading Italian company in the design of marine vehicles, is the first to deploy the 3DEXPERIENCE platform to virtually create and manage the master reference of a superyacht, from digital design to production documentation. With the “Designed for Sea” and “Optimized Production for Sea” industry solution experiences, NAOS integrates all design, engineering and manufacturing processes in a single virtual environment for efficient, real-time collaboration.
Also on September 6, 2016 Dassault Systèmes’ announced that Bureau Veritas, a global leader in testing, inspection and certification for industries including marine and offshore, has selected its “Designed for Sea” industry solution experience to accelerate ship structure modeling and calculations that help customers comply with new regulations and optimize their ship designs.
Products and Industry Solution Experiences
On October 13, 2016 Dassault Systèmes Launched the “Design for Fabrication” Industry Solution Experience for Architecture, Engineering & Construction. Architects, engineers, contractors, fabricators and building products manufacturers now have access to a digital, collaborative environment on the cloud for civil and building projects, from concept through fabrication detail with shop floors that reduces waste and rework. Based on the Company’s 3DEXPERIENCE platform, the “Design for Fabrication” industry solution experience provides end-to-end, collaborative BIM (paperless) for design through fabrication of any building, structure or building element including bridges, tunnels, industrial buildings, high-rise buildings, concrete and steel frames, precast concrete, building façades, as well as building system elements of any scale, from single occupant to campus and city infrastructures.
On September 21, 2016 the Company introduced SOLIDWORKS 2017. From small startups to global organizations, more than 3.1 million users can create multisensory experiences through innovative product design, with access to easy 3D design and development applications anytime, anywhere and on any device. SOLIDWORKS 2017 features more core power and performance, as well as new capabilities to address paperless manufacturing through the support of Model Based Definition, and printed circuit board (PCB) design. Both new and experienced users can improve productivity with simulation to analyze, solve, visualize and verify functionality of designs, before any prototype is created.
Business Outlook
Thibault de Tersant, Senior Executive Vice President, CFO, commented, “Our
third quarter financial results demonstrated good progress with software
revenue growth of 7%, operating margin expansion of 80 basis points and
earnings per share growth of 9% or 17% excluding one-time tax benefits.
Based upon our earnings results, we are upgrading our full year 2016 EPS
objective range to about €2.40 to €2.45. (All figures on a non-IFRS
basis)
