Business Outlook
Thibault de Tersant, Senior Executive Vice President and CFO, commented, “Overall, we have delivered a very solid second quarter with double-digit growth for software revenue and earnings per share – all organic. Moreover, we had a strong level of new business activity, although perhaps less apparent at first glance. In addition to new license revenue growth, our rental software revenue increased more than 20% in constant currencies in the quarter. Our new business came from a number of industries including Aerospace, Energy, High Tech, Industrial Equipment, Life Sciences and Transportation & Mobility.
“From a brand perspective, SIMULIA delivered outstanding results reflecting strong demand around the globe for its finite element analysis, multi-physics as well as its simulation lifecycle management capabilities leveraging ENOVIA V6. And from a regional perspective, the results in Europe were particularly gratifying with revenue growth of 19% in constant currencies in the second quarter.
“Turning to our financial objectives for the full year, we are upgrading them to take into account the second quarter over-performance as well as an improved outlook for the third quarter and adjusting for currency evolution. We are then expanding the perimeter, adding Gemcom while also reflecting the spin-off of our Transcat PLM sales and service business partner operations in Germany. Finally, we are leaving our view of the 4th quarter unchanged, as we believe our initial caution at the outset of 2012 continues to be appropriate.”
The Company’s updated 2012 financial objectives, including Gemcom are as follows:
- Third quarter 2012 non-IFRS total revenue objective of about €480 to €490 million growing 8 to 10% excluding currency effects, non-IFRS operating margin of about 31% to 32%; non-IFRS EPS of about €0.78 to €0.82;
- 2012 non-IFRS revenue growth objective range of about 8% to 9% in constant currencies (€1.99 to €2.01 billion based upon the 2012 currency exchange rate assumptions below);
- 2012 non-IFRS operating margin of about 31%;
- 2012 non-IFRS EPS range of about €3.20 to €3.30, representing growth of about 10% to 13%;
- Objectives are based upon exchange rate assumptions for the 2012 third quarter of US$1.30 per €1.00 and JPY110 per €1.00 and full year of US$1.30 per €1.00 and JPY107 per €1.00.
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 non-IFRS objectives set forth above do not take into account the following accounting elements and are estimated based upon the 2012 currency exchange rates above: share-based compensation expense estimated at approximately €20 million for 2012 and amortization of acquired intangibles estimated at approximately €85 million for 2012. The above objectives do not include any impact from other operating income and expense, net, related to acquisition, integration and restructuring of €4.1 million representing a gain in the 2012 first half. The above non-IFRS adjustments do not take into account the impact of the Gemcom acquisition, for which the accounting elements will be finalized and included in the third quarter earnings announcement. Finally, these estimates do not include any new stock option or share grants, or any new acquisitions or restructurings completed after July 26, 2012.
Today’s Webcast and Conference Call Information
Today, Thursday, July 26, 2012, 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 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/company/finance/. 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 30 days.
Additional investor information can be accessed at http://www.3ds.com/company/finance/ or by calling Dassault Systèmes’ Investor Relations at 33.1.61.62.69.24.
2012 Key Investor Relations Events
Third Quarter Earnings, October 25, 2012
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. If
global economic and business conditions continue to be volatile or
deteriorate, the Company’s business results may not develop as currently
anticipated and may decline below their earlier levels for an extended
period of time. Furthermore, due to factors affecting sales of the
Company’s products and services, there may be a substantial time lag
between any change in global economic and business conditions and its
impact on the Company’s business results.
