Bentley Systems Announces 21Q4 and 2021 Operating Results, and its 2022 Financial Outlook

Forward-Looking Statements

This press release includes forward-looking statements regarding the future results of operations and financial position, business strategy, and plans and objectives for future operations of Bentley Systems, Incorporated (the “Company,” “we,” “us,” and words of similar import). All such statements contained in this press release, other than statements of historical facts, are forward-looking statements. The words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” and similar expressions are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations, projections, and assumptions about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives, and financial needs. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, and there are a significant number of factors that could cause actual results to differ materially from statements made in this press release including: current and potential future impacts of the COVID-19 pandemic on the global economy and our business, and consolidated financial statements; adverse changes in global economic and/or political conditions; political, economic, regulatory and public health and safety risks and uncertainties in the countries and regions in which we operate; failure to retain personnel necessary for the operation of our business or those that we acquire; changes in the industries in which our accounts operate; the competitive environment in which we operate; the quality of our products; our ability to develop and market new products to address our accounts’ rapidly changing technological needs; changes in capital markets and our ability to access financing on terms satisfactory to us or at all; and our ability to integrate acquired businesses successfully.

Further information on potential factors that could affect the financial results of the Company are included in the Company’s Form 10-K and subsequent Forms 10-Q, which are on file with the United States Securities and Exchange Commission. The Company disclaims any obligation to update the forward-looking statements provided to reflect events that occur or circumstances that exist after the date on which they were made.

About Bentley Systems

Bentley Systems (Nasdaq: BSY) is the infrastructure engineering software company. We provide innovative software to advance the world’s infrastructure – sustaining both the global economy and environment. Our industry-leading software solutions are used by professionals, and organizations of every size, for the design, construction, and operations of roads and bridges, rail and transit, water and wastewater, public works and utilities, buildings and campuses, mining, and industrial facilities. Our offerings include MicroStation-based applications for modeling and simulation, ProjectWise for project delivery, AssetWise for asset and network performance, Seequent’s leading geoprofessional software portfolio, and the iTwin platform for infrastructure digital twins. Bentley Systems employs more than 4,500 colleagues and generates annual revenues of approximately $1 billion in 186 countries.

www.bentley.com

© 2022 Bentley Systems, Incorporated. Bentley, the Bentley logo, AssetWise, iTwin, MicroStation, ProjectWise, Seequent, and Power Line Systems are either registered or unregistered trademarks or service marks of Bentley Systems, Incorporated or one of its direct or indirect wholly owned subsidiaries. All other brands and product names are trademarks of their respective owners.

BENTLEY SYSTEMS, INCORPORATED AND SUBSIDIARIES

Consolidated Balance Sheets

(in thousands)

(unaudited)

 

 

 

December 31,

 

 

2021

 

2020

Assets

 

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

 

$

329,337

 

 

$

122,006

 

Accounts receivable

 

 

241,807

 

 

 

195,782

 

Allowance for doubtful accounts

 

 

(6,541

)

 

 

(5,759

)

Prepaid income taxes

 

 

16,880

 

 

 

3,535

 

Prepaid and other current assets

 

 

34,348

 

 

 

24,694

 

Total current assets

 

 

615,831

 

 

 

340,258

 

Property and equipment, net

 

 

31,823

 

 

 

28,414

 

Operating lease right-of-use assets

 

 

50,818

 

 

 

46,128

 

Intangible assets, net

 

 

245,834

 

 

 

45,627

 

Goodwill

 

 

1,588,477

 

 

 

581,174

 

Investments

 

 

6,438

 

 

 

5,691

 

Deferred income taxes

 

 

71,376

 

 

 

39,224

 

Other assets

 

 

48,646

 

 

 

39,519

 

Total assets

 

$

2,659,243

 

 

$

1,126,035

 

Liabilities and Stockholders’ Equity

 

 

 

 

Current liabilities:

 

 

 

 

Accounts payable

 

$

16,483

 

 

$

16,492

 

Accruals and other current liabilities

 

 

323,603

 

 

 

226,793

 

Deferred revenues

 

 

224,610

 

 

 

202,294

 

Operating lease liabilities

 

 

17,482

 

 

 

16,610

 

Income taxes payable

 

 

6,696

 

 

 

3,366

 

Current portion of long-term debt

 

 

5,000

 

 

 

 

Total current liabilities

 

 

593,874

 

 

 

465,555

 

Long-term debt

 

 

1,430,992

 

 

 

246,000

 

Deferred compensation plan liabilities

 

 

94,890

 

 

 

2,422

 

Long-term operating lease liabilities

 

 

35,274

 

 

 

31,767

 

Deferred revenues

 

 

7,983

 

 

 

7,020

 

Deferred income taxes

 

 

65,014

 

 

 

10,849

 

Income taxes payable

 

 

7,725

 

 

 

7,883

 

Other liabilities

 

 

14,269

 

 

 

12,940

 

Total liabilities

 

 

2,250,021

 

 

 

784,436

 

Stockholders’ equity:

 

 

 

 

Common stock

 

 

2,825

 

 

 

2,722

 

Additional paid-in capital

 

 

937,805

 

 

 

741,113

 

Accumulated other comprehensive loss

 

 

(91,774

)

 

 

(26,233

)

Accumulated deficit

 

 

(439,634

)

 

 

(376,003

)

Total stockholders’ equity

 

 

409,222

 

 

 

341,599

 

Total liabilities and stockholders’ equity

 

$

2,659,243

 

 

$

1,126,035

 

BENTLEY SYSTEMS, INCORPORATED AND SUBSIDIARIES

Consolidated Statements of Operations

(in thousands, except share and per share data)

(unaudited)

 

 

 

Three Months Ended

 

Year Ended

 

 

December 31,

 

December 31,

 

 

2021

 

2020

 

2021

 

2020

Revenues:

 

 

 

 

 

 

 

 

Subscriptions

 

$

223,105

 

 

$

178,262

 

 

$

812,807

 

 

$

679,273

 

Perpetual licenses

 

 

19,707

 

 

 

21,362

 

 

 

53,080

 

 

 

57,382

 

Subscriptions and licenses

 

 

242,812

 

 

 

199,624

 

 

 

865,887

 

 

 

736,655

 

Services

 

 

24,920

 

 

 

19,943

 

 

 

99,159

 

 

 

64,889

 

Total revenues

 

 

267,732

 

 

 

219,567

 

 

 

965,046

 

 

 

801,544

 

Cost of revenues:

 

 

 

 

 

 

 

 

Cost of subscriptions and licenses

 

 

34,439

 

 

 

29,337

 

 

 

124,321

 

 

 

95,803

 

Cost of services

 

 

25,128

 

 

 

21,226

 

 

 

92,218

 

 

 

71,352

 

Total cost of revenues

 

 

59,567

 

 

 

50,563

 

 

 

216,539

 

 

 

167,155

 

Gross profit

 

 

208,165

 

 

 

169,004

 

 

 

748,507

 

 

 

634,389

 

Operating expenses:

 

 

 

 

 

 

 

 

Research and development

 

 

63,002

 

 

 

45,945

 

 

 

220,915

 

 

 

185,515

 

Selling and marketing

 

 

47,394

 

 

 

36,240

 

 

 

162,240

 

 

 

143,791

 

General and administrative

 

 

39,883

 

 

 

27,884

 

 

 

150,116

 

 

 

113,274

 

Deferred compensation plan

 

 

5,719

 

 

 

292

 

 

 

95,046

 

 

 

177

 

Amortization of purchased intangibles

 

 

8,898

 

 

 

4,368

 

 

 

25,601

 

 

 

15,352

 

Expenses associated with initial public offering

 

 

 

 

 

 

 

 

 

 

 

26,130

 

Total operating expenses

 

 

164,896

 

 

 

114,729

 

 

 

653,918

 

 

 

484,239

 

Income from operations

 

 

43,269

 

 

 

54,275

 

 

 

94,589

 

 

 

150,150

 

Interest expense, net

 

 

(3,883

)

 

 

(3,026

)

 

 

(12,491

)

 

 

(7,476

)

Other income, net

 

 

1,483

 

 

 

18,190

 

 

 

11,231

 

 

 

24,946

 

Income before income taxes

 

 

40,869

 

 

 

69,439

 

 

 

93,329

 

 

 

167,620

 

(Provision) benefit for income taxes

 

 

(1,642

)

 

 

(16,480

)

 

 

3,448

 

 

 

(38,625

)

Loss from investment accounted for using the equity method, net of tax

 

 

(646

)

 

 

(1,027

)

 

 

(3,585

)

 

 

(2,474

)

Net income

 

 

38,581

 

 

 

51,932

 

 

 

93,192

 

 

 

126,521

 

Less: Net income attributable to participating securities

 

 

(3

)

 

 

(230

)

 

 

(9

)

 

 

(234

)

Net income attributable to Class A and Class B common stockholders

 

$

38,578

 

 

$

51,702

 

 

$

93,183

 

 

$

126,287

 

Per share information:

 

 

 

 

 

 

 

 

Net income per share, basic

 

$

0.13

 

 

$

0.17

 

 

$

0.30

 

 

$

0.44

 

Net income per share, diluted

 

$

0.12

 

 

$

0.17

 

 

$

0.30

 

 

$

0.42

 

Weighted average shares, basic

 

 

307,447,788

 

 

 

297,192,775

 

 

 

305,711,345

 

 

 

289,863,272

 

Weighted average shares, diluted

 

 

314,782,892

 

 

 

309,096,405

 

 

 

314,610,814

 

 

 

299,371,129

 

BENTLEY SYSTEMS, INCORPORATED AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

 

 

 

Year Ended

 

 

December 31,

 

 

2021

 

2020

Cash flows from operating activities:

 

 

 

 

Net income

 

$

93,192

 

 

$

126,521

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

Depreciation and amortization

 

 

52,793

 

 

 

36,117

 

Bad debt allowance (recovery)

 

 

1,203

 

 

 

(1,000

)

Deferred income taxes

 

 

(19,745

)

 

 

16,246

 

Stock-based compensation expense

 

 

49,045

 

 

 

32,114

 

Amortization and write-off of deferred debt issuance costs

 

 

5,955

 

 

 

985

 

Change in fair value of derivative

 

 

(9,770

)

 

 

(347

)

Change in fair value of contingent consideration

 

 

550

 

 

 

(1,340

)

Foreign currency remeasurement loss (gain)

 

 

64

 

 

 

(24,502

)

Loss from investment accounted for using the equity method, net of tax

 

 

3,585

 

 

 

2,474

 

Changes in assets and liabilities, net of effect from acquisitions:

 

 

 

 

Accounts receivable

 

 

(35,519

)

 

 

12,388

 

Prepaid and other assets

 

 

14,260

 

 

 

11,705

 

Accounts payable, accruals, and other liabilities

 

 

50,077

 

 

 

47,656

 

Deferred compensation plan liabilities

 

 

92,926

 

 

 

3,706

 

Deferred revenues

 

 

5,340

 

 

 

(565

)

Income taxes payable, net of prepaid income taxes

 

 

(15,932

)

 

 

(3,818

)

Net cash provided by operating activities

 

 

288,024

 

 

 

258,340

 

Cash flows from investing activities:

 

 

 

 

Purchases of property and equipment and investment in capitalized software

 

 

(17,539

)

 

 

(16,447

)

Acquisitions, net of cash acquired

 

 

(1,034,983

)

 

 

(93,032

)

Other investing activities

 

 

(4,081

)

 

 

(7,854

)

Net cash used in investing activities

 

 

(1,056,603

)

 

 

(117,333

)

Cash flows from financing activities:

 

 

 

 

Proceeds from credit facilities

 

 

745,310

 

 

 

550,875

 

Payments of credit facilities

 

 

(991,310

)

 

 

(538,625

)

Proceeds from convertible senior notes, net of discounts and commissions

 

 

1,233,377

 

 

 

 

Payments of debt issuance costs

 

 

(5,643

)

 

 

(432

)

Purchase of capped call options

 

 

(51,605

)

 

 

 

Proceeds from term loans

 

 

199,505

 

 

 

125,000

 

Payments of financing leases

 

 

(197

)

 

 

(189

)

Payments of acquisition debt and other consideration

 

 

(2,371

)

 

 

(3,425

)

Payments of dividends

 

 

(33,396

)

 

 

(422,646

)

Payments for shares acquired including shares withheld for taxes

 

 

(120,539

)

 

 

(83,975

)

Proceeds from Common Stock Purchase Agreement

 

 

 

 

 

58,349

 

Proceeds from stock purchases under employee stock purchase plan

 

 

3,846

 

 

 

 

Proceeds from exercise of stock options

 

 

5,605

 

 

 

9,128

 

Net cash provided by (used in) financing activities

 

 

982,582

 

 

 

(136,511

)

Effect of exchange rate changes on cash and cash equivalents

 

 

(6,672

)

 

 

(3,591

)

Increase in cash and cash equivalents

 

 

207,331

 

 

 

905

 

Cash and cash equivalents, beginning of year

 

 

122,006

 

 

 

121,101

 

Cash and cash equivalents, end of year

 

$

329,337

 

 

$

122,006

 

BENTLEY SYSTEMS, INCORPORATED AND SUBSIDIARIES

Reconciliation of GAAP to Non-GAAP Measures

For the Three Months and Year Ended December 31, 2021 and 2020

(in thousands)

(unaudited)

 

Reconciliation of net income to Adjusted EBITDA:

 

 

 

Three Months Ended

 

Year Ended

 

 

December 31,

 

December 31,

 

 

2021

 

2020

 

2021

 

2020

Net income

 

$

38,581

 

 

$

51,932

 

 

$

93,192

 

 

$

126,521

 

Interest expense, net

 

 

3,883

 

 

 

3,026

 

 

 

12,491

 

 

 

7,476

 

Provision (benefit) for income taxes

 

 

1,642

 

 

 

16,480

 

 

 

(3,448

)

 

 

38,625

 

Depreciation and amortization

 

 

16,847

 

 

 

10,281

 

 

 

52,793

 

 

 

36,117

 

Stock-based compensation

 

 

15,966

 

 

 

9,354

 

 

 

48,152

 

 

 

32,114

 

Deferred compensation plan

 

 

5,719

 

 

 

292

 

 

 

95,046

 

 

 

177

 

Acquisition expenses

 

 

6,369

 

 

 

3,168

 

 

 

34,368

 

 

 

11,666

 

Realignment expenses

 

 

 

 

 

10

 

 

 

 

 

 

10,022

 

Expenses associated with IPO

 

 

 

 

 

 

 

 

 

 

 

26,130

 

Other income, net

 

 

(1,483

)

 

 

(18,190

)

 

 

(11,231

)

 

 

(24,946

)

Loss from investment accounted for using the equity method, net of tax

 

 

646

 

 

 

1,027

 

 

 

3,585

 

 

 

2,474

 

Adjusted EBITDA

 

$

88,170

 

 

$

77,380

 

 

$

324,948

 

 

$

266,376

 

Reconciliation of net income to Adjusted Net Income:

 

 

 

Three Months Ended

 

Year Ended

 

 

December 31,

 

December 31,

 

 

2021

 

2020

 

2021

 

2020

Net income

 

$

38,581

 

 

$

51,932

 

 

$

93,192

 

 

$

126,521

 

Non-GAAP adjustments, prior to income taxes:

 

 

 

 

 

 

 

 

Amortization of purchased intangibles and developed technologies

 

 

11,998

 

 

 

6,027

 

 

 

34,001

 

 

 

20,721

 

Stock-based compensation

 

 

15,966

 

 

 

9,354

 

 

 

48,152

 

 

 

32,114

 

Deferred compensation plan

 

 

5,719

 

 

 

292

 

 

 

95,046

 

 

 

177

 

Acquisition expenses

 

 

6,369

 

 

 

3,168

 

 

 

34,368

 

 

 

11,666

 

Realignment expenses

 

 

 

 

 

10

 

 

 

 

 

 

10,022

 

Expenses associated with IPO

 

 

 

 

 

 

 

 

 

 

 

26,130

 

Other income, net

 

 

(1,483

)

 

 

(18,190

)

 

 

(11,231

)

 

 

(24,946

)

Total non-GAAP adjustments, prior to income taxes

 

 

38,569

 

 

 

661

 

 

 

200,336

 

 

 

75,884

 

Income tax effect of non-GAAP adjustments

 

 

(5,827

)

 

 

(1,310

)

 

 

(30,173

)

 

 

(12,067

)

Loss from investment accounted for using the equity method, net of tax

 

 

646

 

 

 

1,027

 

 

 

3,585

 

 

 

2,474

 

Adjusted Net Income

 

$

71,969

 

 

$

52,310

 

 

$

266,940

 

 

$

192,812

 

Reconciliation of GAAP Financial Statement Line Items to Non-GAAP Adjusted Financial Statement Line Items:

 

 

 

Three Months Ended

 

Year Ended

 

 

December 31,

 

December 31,

 

 

2021

 

2020

 

2021

 

2020

Cost of subscriptions and licenses

 

$

34,439

 

 

$

29,337

 

 

$

124,321

 

 

$

95,803

 

Amortization of purchased intangibles and developed technologies

 

 

(3,100

)

 

 

(1,659

)

 

 

(8,400

)

 

 

(5,369

)

Stock-based compensation

 

 

(608

)

 

 

(17

)

 

 

(1,417

)

 

 

(925

)

Acquisition expenses

 

 

(26

)

 

 

 

 

 

(33

)

 

 

 

Realignment expenses

 

 

 

 

 

8

 

 

 

 

 

 

(42

)

Adjusted cost of subscriptions and licenses

 

$

30,705

 

 

$

27,669

 

 

$

114,471

 

 

$

89,467

 

 

 

 

 

 

 

 

 

 

Cost of services

 

$

25,128

 

 

$

21,226

 

 

$

92,218

 

 

$

71,352

 

Stock-based compensation

 

 

(529

)

 

 

(156

)

 

 

(1,144

)

 

 

(2,857

)

Acquisition expenses

 

 

(1,466

)

 

 

(866

)

 

 

(5,846

)

 

 

(1,916

)

Realignment expenses

 

 

 

 

 

126

 

 

 

 

 

 

(1,422

)

Adjusted cost of services

 

$

23,133

 

 

$

20,330

 

 

$

85,228

 

 

$

65,157

 

 

 

 

 

 

 

 

 

 

Research and development

 

$

63,002

 

 

$

45,945

 

 

$

220,915

 

 

$

185,515

 

Stock-based compensation

 

 

(5,617

)

 

 

(3,952

)

 

 

(19,510

)

 

 

(11,769

)

Acquisition expenses

 

 

(1,900

)

 

 

(1,493

)

 

 

(6,782

)

 

 

(6,605

)

Realignment expenses

 

 

 

 

 

62

 

 

 

 

 

 

(848

)

Adjusted research and development

 

$

55,485

 

 

$

40,562

 

 

$

194,623

 

 

$

166,293

 

 

 

 

 

 

 

 

 

 

Selling and marketing

 

$

47,394

 

 

$

36,240

 

 

$

162,240

 

 

$

143,791

 

Stock-based compensation

 

 

(1,977

)

 

 

(652

)

 

 

(5,461

)

 

 

(6,259

)

Acquisition expenses

 

 

(463

)

 

 

(75

)

 

 

(1,066

)

 

 

(318

)

Realignment expenses

 

 

 

 

 

(762

)

 

 

 

 

 

(5,945

)

Adjusted selling and marketing

 

$

44,954

 

 

$

34,751

 

 

$

155,713

 

 

$

131,269

 

 

 

 

 

 

 

 

 

 

General and administrative

 

$

39,883

 

 

$

27,884

 

 

$

150,116

 

 

$

113,274

 

Stock-based compensation

 

 

(7,235

)

 

 

(4,577

)

 

 

(20,620

)

 

 

(10,304

)

Acquisition expenses

 

 

(2,508

)

 

 

(618

)

 

 

(20,609

)

 

 

(2,228

)

Realignment expenses

 

 

 

 

 

556

 

 

 

 

 

 

(1,765

)

Adjusted general and administrative

 

$

30,140

 

 

$

23,245

 

 

$

108,887

 

 

$

98,977

 

 

 

 

 

 

 

 

 

 

Income from operations

 

$

43,269

 

 

$

54,275

 

 

$

94,589

 

 

$

150,150

 

Amortization of purchased intangibles and developed technologies

 

 

11,998

 

 

 

6,027

 

 

 

34,001

 

 

 

20,721

 

Stock-based compensation

 

 

15,966

 

 

 

9,354

 

 

 

48,152

 

 

 

32,114

 

Deferred compensation plan

 

 

5,719

 

 

 

292

 

 

 

95,046

 

 

 

177

 

Acquisition expenses

 

 

6,369

 

 

 

3,168

 

 

 

34,368

 

 

 

11,666

 

Realignment expenses

 

 

 

 

 

10

 

 

 

 

 

 

10,022

 

Expenses associated with IPO

 

 

 

 

 

 

 

 

 

 

 

26,130

 

Adjusted income from operations

 

$

83,321

 

 

$

73,126

 

 

$

306,156

 

 

$

250,980

 


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