PARIS—(BUSINESS WIRE)—May 4, 2006— Dassault Systemes (DS) (Nasdaq: DASTY; Euronext Paris: #13065, DSY.PA), a world leader in 3D and Product Lifecycle Management (PLM) solutions, reported financial results for the first quarter ended March 31, 2006.
First Quarter Highlights
-- GAAP total revenue of EUR 252.1 million, up 27% as reported
and 23% in constant currencies
-- Non-GAAP total revenue of EUR 256.0 million, up 29% and 25% in
constant currencies, with revenue excluding ABAQUS up 14% in
-- GAAP software revenue of EUR 213.1 million, up 27% and 24% in
-- Non-GAAP software revenue of EUR 217.0 million, up 30% and 26%
in constant currencies
-- GAAP EPS of EUR 0.26; Non-GAAP EPS up 26% to EUR 0.34 with
operating margin of 23.6%
-- Proposed acquisition of MatrixOne on track for possible
-- 2006 financial objectives updated due to better first quarter
performance, change in yen/euro exchange rate assumption and
MatrixOne proposed acquisition
Bernard Charles, Dassault Systemes President and Chief Executive
Officer, commented, "Dassault Systemes delivered a very solid first
quarter with revenues up 25% in constant currencies and earnings per
share increasing 26%. Strength across our product lines and across all
geographic regions drove our results. This strong financial
performance demonstrates the benefits of our focus on continued
expansion of our SolidWorks channel capacity as well as further
enhancement of the coverage and value of our PLM channel working with
IBM. Good progress has been made on the ABAQUS integration front,
thanks to our V5 infrastructure, with its open architecture, enabling
the integration of a wide range of applications."
"The proposed acquisition of MatrixOne is ahead of our initial
timetables, and subject to their shareholders' approval, we expect to
close by mid-May. MatrixOne brings important assets to our product
portfolio, as its capabilities support business process modeling and
bring wider industry coverage, positioning us to extend our presence
in such industries as high tech, semiconductors and consumer goods.
Moreover, these assets will also benefit our partners through
enterprise integration of heterogeneous systems to accelerate PLM
First Quarter Financial Results
Dassault Systemes completed the acquisition of ABAQUS, Inc. in
October, 2005 and has accounted for the acquisition pursuant to U.S.
GAAP (hereinafter GAAP) purchase accounting rules. Certain
supplementary information is provided in this press release which is
not in conformity with GAAP. See tables for a reconciliation of 2006
and 2005 first quarter GAAP and Non-GAAP financial data.
GAAP Revenue Discussion
Both GAAP and Non-GAAP revenue growth reflected broad-based
strength across DS product lines. For the first quarter of 2006 GAAP
total revenue increased 27% to EUR 252.1 million (23% in constant
currencies), compared to EUR 199.2 million in the first quarter of
2005. GAAP software revenue increased 27% to EUR 213.1 million and
increased 24% in constant currencies.
In the 2006 first quarter, service and other revenue increased 22%
as reported to EUR 39.0 million and increased 19% in constant
currencies, compared to EUR 32.0 million in the year-ago quarter.
Non-GAAP Revenue Discussion
Total revenue increased 29% to EUR 256.0 million and increased 25%
in constant currencies compared to the year-ago quarter. Software and
service revenue represented 85% and 15% of Non-GAAP total revenue in
the 2006 first quarter.
Software revenue increased 30% to EUR 217.0 million and increased
26% in constant currencies on strong growth of the Company's major
software applications and the inclusion of ABAQUS. In the 2005 first
quarter software revenue was EUR 167.2 million. New CATIA and
SolidWorks seats licensed in the 2006 first quarter increased 11% to
17,944 seats, compared to 16,122 in the 2005 first quarter.
PLM (Process-centric) revenue increased 28% and 24% in constant
currencies in the 2006 first quarter, primarily due to year-over-year
growth of design and PDM applications and the inclusion of ABAQUS. PLM
revenue was EUR 203.7 million in the first quarter of 2006, up from
EUR 159.3 million in the year-ago quarter. PDM revenue, on a
stand-alone basis, increased 15% as reported to EUR 26.3 million and
increased 12% in constant currencies, compared to EUR 22.8 million in
the 2005 first quarter on a good ENOVIA performance. CATIA seats
licensed in the first quarter totalled 7,673, representing
year-over-year growth of 2%.
First quarter 2006 financial results included ABAQUS, which the
Company acquired in early October, 2005. For the 2006 first quarter,
ABAQUS' revenue contribution, which is included in PLM results, was
EUR 23 million before the impact of the deferred revenue write-down
required under GAAP purchase accounting treatment.
Mainstream 3D market (design-centric) revenue increased 31% as
reported and 28% in constant currencies to EUR 52.3 million in the
2006 first quarter, up from EUR 39.9 million in the 2005 first
quarter. SolidWorks seats licensed increased 19% to 10,271 licenses.
From a regional perspective, all regions contributed to the strong
growth in total revenue, led by Asia. Specifically, in Asia, revenue
was higher by 32% as reported and 31% in constant currencies. In the
Americas, revenue rose 39% and 28% in constant currencies. In Europe,
revenue increased 21%. For the 2006 first quarter, Europe represented
44% of total revenue, the Americas represented 30% and Asia accounted
Operating Income and Margin and EPS
GAAP earnings per diluted share decreased 4% to EUR 0.26 in the
2006 first quarter, compared to EUR 0.27 in the first quarter of 2005.
GAAP operating income increased 5% to EUR 47.2 million (18.7%
operating margin) in the recently completed quarter, compared to EUR
45.1 million in the 2005 first quarter (22.6% operating margin).
Non-GAAP earnings per diluted share increased 26% to EUR 0.34 in
the 2006 first quarter, up from EUR 0.27 in the year-ago quarter.
Non-GAAP operating income increased 33% to EUR 60.5 million in the
2006 first quarter, up from EUR 45.4 million in the 2005 first
quarter. The Non-GAAP operating margin was 23.6% in the 2006 first
quarter, ahead of the 22.8% for the 2005 first quarter.
Other financial highlights
At March 31, 2006, cash and short-term investments totaled EUR
684.0 million, compared to EUR 379.9 million at December 31, 2005. In
December 2005, DS signed a 5-year revolving credit facility for up to
EUR 200 million and during the first quarter the Company drew down the
entire amount in connection with the anticipated funding of the
MatrixOne acquisition. Net operating cash flow was EUR 101.2 million
for the 2006 first quarter.
Highlights of first quarter wins included among others:
-- Airbus is expanding its usage of DELMIA, adding DELMIA V5
Robotics to simulate, validate and program the robotics
assembly lines in association with CAA V5 partner, CENIT.
-- CLAAS is moving ahead with a full migration to DS Version 5
PLM with CATIA, ENOVIA and SMARTEAM as well as adding DELMIA.
-- Mayer & Cie is taking additional seats of CATIA V5 and
-- Daehan is purchasing CATIA and SMARTEAM licenses.
-- SolidWorks commercial wins in the quarter included Baker Oil
Tools and Garmin Inc, and educational highlights included Knox
County Schools, Middle Tennessee State University and
Instituto Tecnologica de Durango.
Annual Shareholders' Meeting date and cash dividend recommendation
The Annual Shareholders' Meeting has been scheduled for June 14,
2006. The Board of Directors has recommended an annual cash dividend
equivalent to EUR 0.42 per share, representing EUR 48.3 million in the
aggregate, for the fiscal year ended December 31, 2005, and an 11%
increase from last year's dividend per share. The declaration and
payment of any cash dividend is subject to approval by shareholders at
the Annual Shareholders' Meeting.