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Dassault Systèmes Reports 3DEXPERIENCE Software Revenue Up 40% in 2016 Third Quarter

VÉLIZY-VILLACOUBLAY, France — (BUSINESS WIRE) — October 24, 2016 — Regulatory News:

Dassault Systèmes (Paris: DSY) (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 three and nine months ended September 30, 2016. These results were reviewed by the Company’s Board of Directors on October 24, 2016.

Summary Highlights
(Unaudited and revenue figures in constant currencies)

 

2016 Third Quarter and Nine Months Financial Highlights

(Unaudited)

         

In millions of Euros, except per
share data

  IFRS   Non-IFRS
      Change  

Change in
cc*

      Change  

Change in
cc*

Q3 Total Revenue   €735.2   9%   9%   €735.5   7%   7%
Q3 Operating Margin   21.9%           32.0%        
Q3 EPS   €0.44   7%       €0.63   9%    
                         
YTD Total Revenue   €2,180.6   7%   7%   €2,183.0   5%   6%
YTD Operating Margin   20.4%           29.6%        
YTD EPS   €1.18   9%       €1.71   11%    

*In constant currencies

         

“Our 3DEXPERIENCE platform and industry solution experiences continued their strong momentum from the first half, with third quarter 3DEXPERIENCE software revenue higher by 40%,” commented Bernard Charlès, Dassault Systèmes Vice Chairman of the Board of Directors and Chief Executive Officer.

“The quarter also demonstrated the continued momentum in broadening our reach across major industries, with a strong performance in Transportation & Mobility, High Tech, Consumer Goods-Retail, Consumer Packaged Goods-Retail and Architecture, Engineering & Construction. Benefiting High Tech as well as many of the industries we address, looking for Internet of Experience, we have significantly enhanced our multi-physics, multi-scale simulation applicable for autonomous cars, connected homes, smart wearable devices, medical equipment and other smart objects with the completion of the acquisition of CST, the technology leader in electromagnetic simulation.

“Finally, following the Singapore World City Summit in July where our 3DEXPERIENCity program revealed the value of IoT at the scale of a city, we were pleased to complete a strategic cooperation agreement with Cybernaut Investment Group, a leading Chinese group, focused on helping advance Smart Cities and ‘Made in China 2025’ initiatives.”

 

2016 Third Quarter Financial Summary

(Unaudited)

         

In millions of Euros, except per
share data

  IFRS   Non-IFRS
  Q3 2016   Change   Change in cc*   Q3 2016   Change   Change in cc*
Total Revenue   735.2   9%   9%   735.5   7%   7%
Software Revenue   646.8   9%   9%   647.1   7%   7%
Service & other Revenue   88.4   8%   7%   88.4   6%   6%
Operating Margin   21.9%           32.0%        
EPS   0.44   7%       0.63   9%    
         
         
In millions of Euros   IFRS   Non-IFRS
  Q3 2016   Change   Change in cc*   Q3 2016   Change   Change in cc*
Americas software revenue   194.8   6%   6%   194.8   3%   3%
Europe software revenue   263.0   3%   5%   263.3   2%   4%
Asia software revenue   189.0   23%   18%   189.0   22%   17%

*In constant currencies

         
 
 

2016 Nine Months Financial Summary

(Unaudited)

         

In millions of Euros, except per
share data

  IFRS   Non-IFRS
  YTD 2016   Change   Change in cc*   YTD 2016   Change   Change in cc*
Total Revenue   2,180.6   7%   7%   2,183.0   5%   6%
Software Revenue   1,928.4   7%   8%   1,930.4   6%   6%
Service & other Revenue   252.2   4%   4%   252.6   3%   3%
Operating Margin   20.4%           29.6%        
EPS   1.18   9%       1.71   11%    
         
         
In millions of Euros   IFRS   Non-IFRS
  YTD 2016   Change   Change in cc*   YTD 2016   Change   Change in cc*
Americas software revenue   582.2   8%   8%   583.2   5%   6%
Europe software revenue   803.5   4%   7%   804.2   3%   6%
Asia software revenue   542.7   11%   9%   543.0   10%   8%

*In constant currencies

         
 

Cash Flow and Other Financial Highlights

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)

“While overall results were in line, our new license activity was slightly below our expectations due to 3DEXPERIENCE purchase decisions taking place at a business strategy level, and requiring more time from customers, as the very last days of the quarter demonstrated.

“With respect to our 2016 non-IFRS revenue objective, we are updating our range to €3.015 to €3.030 billion. At the low end, this reflects the addition of the CST acquisition for one quarter and the full benefit from currency during the third quarter. We are also narrowing the guidance range to €15 million to reflect the fact that there is only one quarter left to the year.

“Looking at 2016 in total, we expect a year of solid software revenue and earnings per share growth, well reflecting the strong traction we are seeing with 3DEXPERIENCE, improving sales trends in our Professional channel with SOLIDWORKS and continued good dynamics of our recurring software revenue.”

The Company’s fourth 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 principal currency exchange rates above: deferred revenue write-downs estimated at approximately €8 million, share-based compensation expense, including related social charges, estimated at approximately €79 million and amortization of acquired intangibles estimated at approximately €154 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 October 25, 2016.

Today’s Webcast and Conference Call Information

Today, Tuesday, October 25, 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 1 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

Fourth Quarter 2016 Earnings, February 2, 2017

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 and in the Risk Factors section of the Company’s most recent Document de Référence, 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 fourth quarter and US$1.12 per €1.00 for the full year as well as an average Japanese yen to euro exchange rate of JPY120.0 to €1.00 for the fourth quarter and JPY120.8 to €1.00 for the full year before hedging; 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 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 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.

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 210,000 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 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 millions of Euros, except per share data and
percentages

  Three months ended       Nine months ended
 

September 30,
2016

 

September 30,
2015

  Change  

Change
in cc*

 

September 30,
2016

 

September 30,
2015

  Change  

Change
in cc*

Non-IFRS Revenue € 735.5   € 686.0   7%   7%   € 2,183.0   € 2,074.6   5%   6%
 
Non-IFRS Revenue breakdown by activity
Software revenue 647.1 602.8 7% 7% 1,930.4 1,829.2 6% 6%
of which new licenses revenue 161.5 149.4 8% 6% 511.0 495.8 3% 3%
of which periodic licenses, maintenance and

other software-related revenue

485.6 453.4 7% 8% 1,419.4 1,333.4 6% 8%
Services and other revenue 88.4 83.2 6% 6% 252.6 245.4 3% 3%
 
Non-IFRS Recurring software revenue 482.6 450.5 7% 8% 1,411.2 1,317.2 7% 8%
 
Non-IFRS software revenue breakdown by product line
CATIA software revenue 237.5 221.8 7% 7% 703.0 676.4 4% 4%
ENOVIA software revenue 77.0 69.9 10% 9% 229.6 206.7 11% 11%
SOLIDWORKS software revenue 152.2 135.5 12% 14% 455.9 418.5 9% 11%
Other software revenue 180.4 175.6 3% 2% 541.9 527.6 3% 3%
 
Non-IFRS Revenue breakdown by geography
Americas 225.4 224.4 0% 1% 674.8 652.7 3% 4%
Europe 302.4 294.6 3% 5% 915.5 889.6 3% 5%
Asia   207.7   167.0   24%   18%   592.7   532.3   11%   9%
 
Non-IFRS operating income € 235.3 € 213.7 10% € 646.2 € 597.8 8%
Non-IFRS operating margin 32.0% 31.2% 29.6% 28.8%
Non-IFRS net income attributable to shareholders 161.6 148.5 9% 439.0 395.5 11%
Non-IFRS diluted net income per share   € 0.63   € 0.58   9%       € 1.71   € 1.54   11%    
Closing headcount   14,921   13,813   8%       14,921   13,813   8%    
 
Average Rate USD per Euro 1.12 1.11 1% 1.12 1.11 1%
Average Rate JPY per Euro   114.3   135.9   -16%       121.0   134.8   -10%    

*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   Nine months ended
September 30,   September 30, September 30,   September 30,
  2016   2015   2016   2015
New licenses revenue 161.5 145.8 510.4 479.7
Periodic licenses, maintenance and other software-related revenue 485.3   447.7   1,418.0   1,319.8
Software revenue 646.8 593.5 1,928.4 1,799.5
Services and other revenue 88.4   82.2   252.2   243.5
Total Revenue € 735.2 € 675.7 € 2,180.6 € 2,043.0
Cost of software revenue (excluding amortization of acquired intangibles) (36.9) (33.4) (112.1) (105.4)
Cost of services and other revenue (74.6) (72.3) (230.4) (217.2)
Research and development (131.8) (114.9) (401.0) (366.5)
Marketing and sales (224.1) (211.3) (684.1) (657.1)
General and administrative (56.3) (51.6) (166.7) (152.5)
Amortization of acquired intangibles (37.8) (42.8) (115.2) (120.4)
Other operating income and expense, net (12.8)   (0.6)   (26.3)   (6.8)
Total Operating Expenses (€ 574.3)   (€ 526.9)   (€ 1,735.8)   (€ 1,625.9)
Operating Income € 160.9 € 148.8 € 444.8 € 417.1
Financial revenue and other, net (0.8)   (1.0)   (17.6)   2.7
Income before income taxes 160.1 147.8 427.2 419.8
Income tax expense (45.1) (41.7) (118.6) (141.2)
Net Income 115.0 106.1 308.6 278.6
Non-controlling interest (1.9)   (0.6)   (4.3)   (2.9)
Net Income attributable to equity holders of the parent € 113.1   € 105.5   € 304.3   € 275.7
Basic net income per share 0.44   0.42   1.20   1.09
Diluted net income per share € 0.44   € 0.41   € 1.18   € 1.08
Basic weighted average shares outstanding (in millions) 254.3   252.8   254.0   252.3
Diluted weighted average shares outstanding (in millions)   257.7   256.5   257.4   256.4
 
 

IFRS revenue variation as reported and in constant currencies

         
  Three months ended September 30, 2016   Nine months ended September 30, 2016
    Change*   Change in cc**   Change*   Change in cc**
IFRS Revenue 9%   9%   7%   7%
IFRS Revenue by activity
Software revenue 9% 9% 7% 8%
Services and other revenue 8% 7% 4% 4%
IFRS Software Revenue by product line
CATIA software revenue 7% 7% 4% 4%
ENOVIA software revenue 10% 9% 11% 11%
SOLIDWORKS software revenue 12% 14% 9% 11%
Other software revenue 8% 8% 8% 9%
IFRS Revenue by geography
Americas 3% 3% 6% 6%
Europe 4% 6% 4% 6%
Asia   25%   19%   12%   10%

*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

September 30, December 31,
    2016       2015
 
ASSETS
Cash and cash equivalents 2,452.9 2,280.5
Short-term investments 49.5 70.8
Accounts receivable, net 539.5 739.1
Other current assets 230.3 150.8
Total current assets 3,272.2 3,241.2
Property and equipment, net 130.6 135.3
Goodwill and Intangible assets, net 2,872.2 2,687.1
Other non-current assets 320.0       247.8
Total Assets     € 6,595.0       € 6,311.4
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable 122.8 119.8
Unearned revenues 801.1 778.0
Other current liabilities 438.2 414.0
Total current liabilities 1,362.1 1,311.8
Long-term debt 1,000.0 1,000.0
Other non-current obligations 577.3 511.9
Total long-term liabilities 1,577.3 1,511.9
Non-controlling interests 20.8 19.2
Parent shareholders' equity 3,634.8       3,468.5
Total Liabilities and Shareholders' equity     € 6,595.0       € 6,311.4
 
         

DASSAULT SYSTEMES

CONDENSED CONSOLIDATED CASH FLOW STATEMENTS (IFRS)

(unaudited; in millions of Euros)

           
In millions of Euros Three months ended     Nine months ended
 

September 30,
2016

   

September 30,
2015

    Change    

September 30,
2016

   

September 30,
2015

    Change
Net Income attributable to equity holders of the parent 113.1     105.5     7.6 304.3     275.7     28.6

Non-controlling interest

1.9

0.6

1.3

4.3

2.9

1.4

Net Income 115.0 106.1 8.9 308.6 278.6 30.0
Depreciation of property & equipment 10.1 10.5 (0.4) 31.5 31.5 0.0
Amortization of intangible assets 39.9 45.0 (5.1) 121.6 126.7 (5.1)
Other non cash P&L Items 22.2 (2.5) 24.7 13.4 (22.8) 36.2
Changes in working capital (110.6)     (45.7)     (64.9)     50.6     116.2     (65.6)
Net Cash provided by operating activities € 76.6 € 113.4 (€ 36.8) € 525.7 € 530.2 (€ 4.5)
 
Additions to property, equipment and intangibles (13.6) (12.8) (0.8) (32.0) (30.8) (1.2)
Payments for acquisition of businesses, net of cash acquired (234.7) - (234.7) (245.9) (18.1) (227.8)
Sale (purchase) of short term investments, net 0.7 1.4 (0.7) 20.5 17.7 2.8
Sale (purchase) of investments, loans and others -     0.3     (0.3)     0.6     (3.3)     3.9
Net Cash provided by (used in) investing activities (€ 247.6) (€ 11.1) (€ 236.5) (€ 256.8) (€ 34.5) (€ 222.3)
 
Proceeds (Repayments) of short-term and long-term debt - - - - (10.8) 10.8
(Purchase) Sale of treasury stock (9.2) (22.9) 13.7 (52.5) (28.0) (24.5)
Proceeds from exercise of stock options 5.4 5.5 (0.1) 15.9 25.0 (9.1)
Cash dividend paid -     (2.9)     2.9     (101.9)     (98.5)     (3.4)
Net Cash provided by (used in) financing activities (€ 3.8) (€ 20.3) € 16.5 (€ 138.5) (€ 112.3) (€ 26.2)
 
Effect of exchange rate changes on

cash and cash equivalents

(3.4) (6.1) 2.7 (3.3) 32.4 (35.7)
                               
Increase (decrease) in cash and cash equivalents   (€ 178.2)     € 75.9     (€ 254.1)     € 127.1     € 415.8     (€ 288.7)
                                   

Cash and cash equivalents at beginning of period

€ 2,585.8

€ 1,444.1

€ 2,280.5

€ 1,104.2

Cash and cash equivalents at end of period

€ 2,407.6

€ 1,520.0

€ 2,407.6

€ 1,520.0

 

DASSAULT SYSTEMES
SUPPLEMENTAL NON-IFRS FINANCIAL INFORMATION
IFRS – NON-IFRS RECONCILIATION
(unaudited; in millions of Euros, except per share data)

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, 2015 filed with the AMF on March 23, 2016. 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.

                         
In millions of Euros, except per share data and percentages   Three months ended September 30,   Change
2016  

Adjustment

  2016   2015  

Adjustment

  2015   IFRS  

Non-IFRS

    IFRS  

(1)

  non-IFRS   IFRS  

(1)

  non-IFRS      

(2)

Total Revenue € 735.2 € 0.3 € 735.5 € 675.7 € 10.3 € 686.0 9% 7%
Total Revenue breakdown by activity
Software revenue 646.8 0.3 647.1 593.5 9.3 602.8 9% 7%
New Licenses 161.5 161.5 145.8 3.6 149.4 11% 8%
Other software-related revenue 3.1 3.1 2.9 2.9 7% 7%
Periodic Licenses and Maintenance 482.2 0.3 482.5 444.8 5.7 450.5 8% 7%
Recurring portion of Software revenue 75% 75% 75% 75%
Services and other revenue 88.4 88.4 82.2 1.0 83.2 8% 6%
Total Software Revenue breakdown by product line
CATIA software revenue 237.5 237.5 221.8 221.8 7% 7%
ENOVIA software revenue 77.0 77.0 69.9 69.9 10% 10%
SOLIDWORKS software revenue 152.2 152.2 135.5 135.5 12% 12%
Other software revenue 180.1 0.3 180.4 166.3 9.3 175.6 8% 3%
Total Revenue breakdown by geography
Americas 225.4 225.4 218.7 5.7 224.4 3% 0%
Europe 302.1 0.3 302.4 291.5 3.1 294.6 4% 3%
Asia   207.7       207.7   165.5   1.5   167.0   25%   24%
Total Operating Expenses (€ 574.3) € 74.1 (€ 500.2) (€ 526.9) € 54.6 (€ 472.3) 9% 6%
Share-based compensation expense (23.5) 23.5 - (11.2) 11.2 -
Amortization of acquired intangibles (37.8) 37.8 - (42.8) 42.8 -
Other operating income and expense, net   (12.8)   12.8   -   (0.6)   0.6   -        
Operating Income € 160.9 € 74.4 € 235.3 € 148.8 € 64.9 € 213.7 8% 10%
Operating Margin 21.9% 32.0% 22.0% 31.2%
Financial revenue & other, net (0.8) (0.4) (1.2) (1.0) (1.0) -20% 20%
Income tax expense (45.1) (25.5) (70.6) (41.7) (21.9) (63.6) 8% 11%
Non-controlling interest (1.9) (1.9) (0.6) (0.6) 217% 217%
Net Income attributable to shareholders € 113.1 48.5 € 161.6 € 105.5 43.0 € 148.5 7% 9%
Diluted Net Income Per Share (3)   € 0.44   0.19   € 0.63   € 0.41   0.17   € 0.58   7%   9%

(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.

                 
  Three months ended September 30,
In millions of Euros 2016 IFRS   Adjustment   2016   2015 IFRS   Adjustment   2015
        non-IFRS       non-IFRS
Cost of revenue (111.5) 0.6 (110.9) (105.7) 0.5 (105.2)
Research and development (131.8) 10.0 (121.8) (114.9) 4.6 (110.3)
Marketing and sales (224.1) 7.3 (216.8) (211.3) 3.8 (207.5)
General and administrative (56.3) 5.6 (50.7) (51.6) 2.3 (49.3)
Total share-based compensation expense       23.5           11.2    

(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 257.7 million diluted shares for Q3 2016 and 256.5 million diluted shares for Q3 2015.

DASSAULT SYSTEMES
SUPPLEMENTAL NON-IFRS FINANCIAL INFORMATION
IFRS – NON-IFRS RECONCILIATION
(unaudited; in millions of Euros, except per share data)

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, 2015 filed with the AMF on March 23, 2016. 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.

                         

In millions of Euros, except per share data and
percentages

 

  Nine months ended September 30,   Change
2016  

Adjustment

  2016   2015  

Adjustment

  2015   IFRS  

Non-IFRS

    IFRS  

(1)

  non-IFRS   IFRS  

(1)

  non-IFRS      

(2)

Total Revenue € 2,180.6 € 2.4 € 2,183.0 € 2,043.0 € 31.6 € 2,074.6 7% 5%
Total Revenue breakdown by activity
Software revenue 1,928.4 2.0 1,930.4 1,799.5 29.7 1,829.2 7% 6%
New Licenses 510.4 0.6 511.0 479.7 16.1 495.8 6% 3%
Other software-related revenue 8.3 8.3 16.2 16.2 -49% -49%
Periodic Licenses and Maintenance 1,409.7 1.4 1,411.1 1,303.6 13.6 1,317.2 8% 7%
Recurring portion of Software revenue 73% 73% 72% 72%
Services and other revenue 252.2 0.4 252.6 243.5 1.9 245.4 4% 3%

Total Software Revenue breakdown by product
line

CATIA software revenue 703.0 703.0 676.4 676.4 4% 4%
ENOVIA software revenue 229.6 229.6 206.7 206.7 11% 11%
SOLIDWORKS software revenue 455.9 455.9 418.5 418.5 9% 9%
Other software revenue 539.9 2.0 541.9 497.9 29.7 527.6 8% 3%
Total Revenue breakdown by geography
Americas 673.6 1.2 674.8 636.1 16.6 652.7 6% 3%
Europe 914.7 0.8 915.5 879.4 10.2 889.6 4% 3%
Asia   592.3   0.4   592.7   527.5   4.8   532.3   12%   11%
Total Operating Expenses (€ 1,735.8) € 199.0 (€ 1,536.8) (€ 1,625.9) € 149.1 (€ 1,476.8) 7% 4%
Share-based compensation expense (57.5) 57.5 - (21.9) 21.9 -
Amortization of acquired intangibles (115.2) 115.2 - (120.4) 120.4 -
Other operating income and expense, net   (26.3)   26.3   -   (6.8)   6.8   -        
Operating Income € 444.8 € 201.4 € 646.2 € 417.1 € 180.7 € 597.8 7% 8%
Operating Margin 20.4% 29.6% 20.4% 28.8%
Financial revenue & other, net (17.6) 11.4 (6.2) 2.7 2.7 -752% -330%
Income tax expense (118.6) (78.1) (196.7) (141.2) (60.9) (202.1) -16% -3%
Non-controlling interest (4.3) (4.3) (2.9) (2.9) 48% 48%
Net Income attributable to shareholders € 304.3 134.7 € 439.0 € 275.7 119.8 € 395.5 10% 11%
Diluted Net Income Per Share (3)   € 1.18   0.53   € 1.71   € 1.08   0.46   € 1.54   9%   11%

(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.

                 
  Nine months ended September 30,
In millions of Euros 2016 IFRS   Adjustment   2016   2015 IFRS   Adjustment   2015
        non-IFRS       non-IFRS
Cost of revenue (342.5) 2.0 (340.5) (322.6) 0.6 (322.0)
Research and development (401.0) 23.9 (377.1) (366.5) 9.0 (357.5)
Marketing and sales (684.1) 19.1 (665.0) (657.1) 8.1 (649.0)
General and administrative (166.7) 12.5 (154.2) (152.5) 4.2 (148.3)
Total share-based compensation expense       57.5           21.9    

(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 257.4 million diluted shares for 9 months 2016 and 256.4 million diluted shares for 9 months 2015.


Contact:

Dassault Systèmes:
François-José Bordonado/Béatrix Martinez
+33.1.61.62.69.24
or
United States and Canada:
Email Contact
or
FTI Consulting:
Rob Mindell, +44.20.3727.1000
or
Arnaud de Cheffontaines, +33.1.47.03.69.48