Dassault Systèmes Delivers Q2 Software Revenue and EPS at the High-end of its Objectives and Signs with Boeing a New and Expanded Historic Partnership Agreement

In preparing such forward-looking statements, the Company has in particular assumed an average US dollar to euro exchange rate of US$1.15 per €1.00 for the 2017 third quarter and US$1.12 per €1.00 for the full year 2017 as well as an average Japanese yen to euro exchange rate of JPY130 to €1.00 for the third quarter and JPY125.9 to €1.00 for the full year 2017 before hedging; however, currency values fluctuate, and the Company’s results of operations may be significantly affected by changes in exchange rates.

Non-IFRS Financial Information

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 2016 Document de Référence filed with the AMF on March 22, 2017.

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.

This press release constitutes the quarterly financial information required by article L.451-1-2 IV of the French Monetary and Financial Code (Code Monétaire et Financier).

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 220,000 customers of all sizes, in all industries, in more than 140 countries. For more information, visit www.3ds.com.

3DEXPERIENCE, the Compass logo and the 3DS logo, CATIA, SOLIDWORKS, ENOVIA, DELMIA, SIMULIA, GEOVIA, EXALEAD, 3D VIA, BIOVIA, NETVIBES and 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
(unaudited; in millions of Euros, except per share data, headcount and exchange rates)

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.

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 millions of Euros, except per share data and percentages       Three months ended   Six months ended
     

June 30,
2017

 

June 30,
2016

  Change  

Change
in cc*

 

June 30,
2017

 

June 30,
2016

  Change  

Change
in cc*

Non-IFRS Revenue € 810.6   € 754.0   8%   6%   € 1,576.3   € 1,447.5   9%   7%
 
Non-IFRS Revenue breakdown by activity
Software revenue 722.7 669.4 8% 7% 1,398.8 1,283.3 9% 7%
of which new licenses and other software-related revenue 211.8 194.5 9% 8% 384.8 354.7 8% 7%
of which periodic licenses, maintenance 510.9 474.9 8% 6% 1,014.0 928.6 9% 7%
Services revenue 87.9 84.6 4% 3% 177.5 164.2 8% 7%
 
Non-IFRS software revenue breakdown by product line
CATIA software revenue 249.7 244.0 2% 1% 486.2 465.5 4% 3%
ENOVIA software revenue 84.4 81.7 3% 2% 158.0 152.6 4% 2%
SOLIDWORKS software revenue 176.7 152.2 16% 14% 350.9 303.7 16% 13%
Other software revenue 211.9 191.5 11% 9% 403.7 361.5 12% 9%
 
Non-IFRS Revenue breakdown by geography
Americas 258.1 232.9 11% 8% 493.9 449.3 10% 6%
Europe 337.1 320.2 5% 6% 660.1 613.2 8% 8%
Asia       215.4   200.9   7%   5%   422.3   385.0   10%   6%
 
Non-IFRS operating income € 243.8 € 229.2 6% € 444.5 € 410.9 8%
Non-IFRS operating margin 30.1% 30.4% 28.2% 28.4%
Non-IFRS net income attributable to shareholders € 159.4 € 146.3 9% € 295.1 € 277.4 6%
Non-IFRS diluted net income per share       € 0.62   € 0.57   9%       € 1.15   € 1.08   6%    
Closing headcount       15,456   14,310   8%       15,456   14,310   8%    
 
Average Rate USD per Euro 1.10 1.13 -3% 1.08 1.12 -4%
Average Rate JPY per Euro       122.6   121.9   1%       121.8   124.4   -2%    

* In constant currencies

 

DASSAULT SYSTEMES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (IFRS)

(unaudited; in millions of Euros, except per share data)

In millions of Euros, except per share data and
percentages

  Three months ended   Six months ended

June 30,
2017

 

June 30
2016

 

June 30,
2017

 

June 30,
2016

       
New licenses and Other software revenue 211.8 194.5 384.8 354.1
Periodic and Maintenance revenue 506.7   474.9   1,003.9   927.5
Software revenue 718.5 669.4 1,388.7 1,281.6
Services revenue 87.9   84.6   177.5   163.8
Total Revenue € 806.4 € 754.0 € 1,566.2 € 1,445.4

Cost of software revenue (excluding amortization
of acquired intangibles)

(38.0) (37.7) (78.4) (75.2)
Cost of services and other revenue (79.0) (78.7) (161.8) (155.8)
Research and development (156.2) (138.7) (305.9) (269.2)
Marketing and sales (258.5) (232.2) (518.3) (460.0)
General and administrative (61.5) (56.0) (121.8) (110.4)
Amortization of acquired intangibles (39.3) (38.2) (80.5) (77.4)
Other operating income and expense, net (4.5)   (11.1)   (10.6)   (13.5)
Total Operating Expenses (637.0)   (592.6)   (1,277.3)   (1,161.5)
Operating Income € 169.4 € 161.4 € 288.9 € 283.9
Financial revenue and other, net 15.3   (7.6)   22.5   (16.8)
Income before income taxes 184.7 153.8 311.4 267.1
Income tax expense (61.8) (50.9) (102.1) (73.5)
Net Income € 122.9 € 102.9 € 209.3 € 193.6
Non-controlling interest 0.1   (1.6)   (1.3)   (2.4)

Net Income attributable to equity holders of
the parent

€ 123.0   € 101.3   € 208.0   € 191.2
Basic net income per share 0.48   0.40   0.82   0.75
Diluted net income per share € 0.48   € 0.39   € 0.81   € 0.74

Basic weighted average shares outstanding (in
millions)

254.5   253.8   254.2   253.8

Diluted weighted average shares outstanding (in
millions)

  257.9   257.3   257.1   257.3
 

IFRS revenue variation as reported and in constant currencies

       

 

 
Three months ended June 30, 2017   Six months ended June 30, 2017
    Change*   Change in cc**   Change*   Change in cc**
IFRS Revenue 7% 6% 8% 6%
IFRS Revenue by activity
Software revenue 7% 6% 8% 6%
Services Revenue 4% 3% 8% 7%
IFRS Software Revenue by product line
CATIA software revenue 2% 1% 4% 3%
ENOVIA software revenue 3% 2% 4% 2%
SOLIDWORKS software revenue 16% 14% 16% 13%
Other software revenue 8% 7% 9% 7%
IFRS Revenue by geography
Americas 10% 7% 9% 6%
Europe 4% 5% 7% 7%
Asia   7%   5%   10%   6%

*Variation compared to the same period in the prior year. **In constant currencies

 

DASSAULT SYSTEMES

CONDENSED CONSOLIDATED BALANCE SHEETS (IFRS)

(unaudited; in millions of Euros)

In millions of Euros  

June 30,
2017

 

December 31,
2016

   
 
ASSETS
Cash and cash equivalents 2,769.2 2,436.7
Short-term investments 48.2 56.1
Accounts receivable, net 610.3 820.4
Other current assets 264.2 257.2
Total current assets 3,691.9 3,570.4
Property and equipment, net 156.7 135.4
Goodwill and Intangible assets, net 2,770.6 2,926.5
Other non-current assets 286.5   310.7
Total Assets   € 6,905.7   € 6,943.0
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable 137.3 144.9
Unearned revenues 928.7 853.1
Other current liabilities 501.0 467.6
Total current liabilities 1,567.0 1,465.6
Long-term debt 1,000.0 1,000.0
Other non-current obligations 545.5 594.6
Total long-term liabilities 1,545.5 1,594.6
Non-controlling interests 2.5 22.6
Parent shareholders' equity 3,790.7   3,860.2
Total Liabilities and Shareholders' equity   € 6,905.7   € 6,943.0
 

DASSAULT SYSTEMES

CONDENSED CONSOLIDATED CASH FLOW STATEMENTS (IFRS)

(unaudited; in millions of Euros)

In millions of Euros  

Three months ended

  Six months ended
 

June 30,
2017

 

June 30,
2016

  Change  

June 30,
2017

 

June 30,
2016

  Change
Net Income attributable to equity holders of the parent 123.0   101.3   21.7   208.0   191.2   16.8
Non-controlling interest (0.1)   1.6   (1.7)   1.3   2.4   (1.1)
Net Income 122.9 102.9 20.0 209.3 193.6 15.7
Depreciation of property & equipment 11.1 10.9 0.2 22.9 21.4 1.5
Amortization of intangible assets 41.3 40.5 0.8 84.6 81.7 2.9
Other non cash P&L Items 2.6 0.5 2.1 10.4 (8.8) 19.2
Changes in working capital 66.7   (15.0)   81.7   265.2   161.2   104.0
Net Cash provided by operating activities € 244.6 € 139.8 € 104.8 € 592.4 € 449.1 € 143.3
 
Additions to property, equipment and intangibles (27.4) (9.6) (17.8) (45.8) (18.4) (27.4)
Payments for acquisition of businesses, net of cash acquired (7.6) (11.2) 3.6 (8.0) (11.2) 3.2
Sale (purchase) of short term investments, net 12.5 (1.0) 13.5 3.7 19.8 (16.1)
Investments, loans and others -   (0.5)   0.5   6.4   0.6   5.8
Net Cash provided by (used in) investing activities (€ 22.5) (€ 22.3) (€ 0.2) (€ 43.7) (€ 9.2) (€ 34.5)
 
Acquisition of non-controlling interests (14.1) - (14.1) (14.1) - (14.1)
(Purchase) Sale of treasury stock (47.9) (9.0) (38.9) (44.8) (43.3) (1.5)
Proceeds from exercise of stock-options 16.5 7.3 9.2 21.8 10.5 11.3
Cash dividend paid (51.3)   (100.1)   48.8   (51.3)   (101.9)   50.6
Net Cash provided by (used in) financing activities (€ 96.8) (€ 101.8) € 5.0 (€ 88.4) (€ 134.7) € 46.3
 

Effect of exchange rate changes on
cash and cash equivalents

(121.5) 28.1 (149.6) (127.8) 0.1 (127.9)
                     
Increase (decrease) in cash and cash equivalents   € 3.8   € 43.8   (€ 40.0)   € 332.5   € 305.3   € 27.2
                         
Cash and cash equivalents at beginning of period € 2,765.4 € 2,542.0 € 2,436.7 € 2,280.5
Cash and cash equivalents at end of period   € 2,769.2   € 2,585.8       € 2,769.2   € 2,585.8    
 

DASSAULT SYSTEMES

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