Dassault Systèmes announced that Paul DiLaura has been named Managing Director of North America. DiLaura will be responsible for managing and growing all aspects of Dassault Systèmes’ North American business operations and accelerating the adoption of the 3DEXPERIENCE platform. DiLaura will be based in Santa Clara, California at Dassault Systèmes’ new West Coast headquarters. This headquarters will place Dassault Systèmes in the heart of Silicon Valley to help lead innovation with customers and partners in the area. North America is home to more than 3,500 employees and 150 partners of Dassault Systèmes.
Thibault de Tersant, Senior Executive Vice President, CFO, commented, “Our revenue results well reflected the framework we had outlined entering the first quarter, leading to total revenue coming in at the high end of our objective range, underlying operating margin progression of 60 basis points excluding currency, well in line with our full year goal, and a good progression of earnings per share and operating cash flow.
“We continue to strengthen the predictability of our financial model, with a long-standing focus on recurring software. During the quarter, recurring software revenue increased 8% in constant currencies and represented 74% of total software revenue. As anticipated, new licenses revenue results reflected a high comparison base as well as our expectation of a more back-ended year of investments by our clients. At the same time, the quarter illustrated very well the traction which is building, with 3DEXPERIENCE new licenses revenue increasing 33% in constant currencies.
“Based upon our financial results and outlook we are reconfirming our 2016 financial objectives and leaving them unchanged despite absorbing additional headwinds from multiple currencies.”
The Company’s second quarter and full year 2016 financial objectives are as follows:
- Second quarter 2016 non-IFRS total revenue objective of about €735-745 million based upon the exchange rates assumptions below; non-IFRS operating margin of about 29% to 30%; and non-IFRS EPS of about €0.53 to €0.55;
- 2016 non-IFRS revenue growth objective of about 6% to 7% in constant currencies at €2.985 to €3.015 billion (based upon the 2016 currency exchange rate assumptions below);
- 2016 non-IFRS operating margin of about 31%, compared to 2015 where the non-IFRS operating margin was 30.8%;
- 2016 non-IFRS EPS of about €2.40, representing a growth objective of about 7%, as reported;
- Objectives are based upon exchange rate assumptions of US$1.15 per €1.00 for the 2016 second quarter and US$1.14 per €1.00 for the full year and JPY130.0 per €1.00 for the second quarter and JPY129.2 per €1.00 for the full year.
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 principal currency exchange rates above: deferred revenue write-downs estimated at approximately €2 million, share-based compensation expense, including related social charges, estimated at approximately €61 million and amortization of acquired intangibles estimated at approximately €147 million. The above objectives also do not include any impact from other operating income and expense, net principally comprised of acquisition, integration and restructuring expenses, from one-time items included in financial revenue and from one-time tax restructuring gains and losses. Finally, these estimates do not include any new stock option or share grants, or any new acquisitions or restructurings completed after April 21, 2016.
Today’s Webcast and Conference Call Information
Today, Thursday, April 21, 2016, Dassault Systèmes will first host a meeting in London, which will be simultaneously webcasted at 8:30 AM London time/9:30 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 22.214.171.124.69.24.
Key Investor Relations Events
Annual Meeting of Shareholders, May 26, 2016
Capital Markets Day, June 10, 2016
Second Quarter Earnings, July 21, 2016
Third Quarter Earnings, October 25, 2016
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$1.15 per €1.00 for the 2016 second 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 second quarter and JPY129.2 to €1.00 for the 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 2015 Document de Référence, filed with the AMF on March 23, 2016, 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, 2015 included in the Company’s 2015 Document de Référence filed with the AMF on March 23, 2016.
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.
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