February 13, 2006
2005 A Good Year For PLM Giants
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Although 2005 was not particularly kind to many types of businesses, it was certainly a good year for several companies in PLM, including Dassault Systemes (which reports its monetary information in Euros) and UGS (which reports in US dollars), as disclosed below. The two companies were extremely close in revenues for the year at about US$1.15 billion each. These companies join Autodesk in the billion-dollar revenue club for the year, and PTC wasn't far behind at a little over $720 million in revenue.
companies and technologies it has acquired in the past year or so). But, what Autodesk does have is diversity in its product line -- mechanical/electrical design, architecture, GIS/infrastructure, and entertainment - not a bad trait to have. For PTC, depending on how it's configured, Pro/ENGINEER can be considered mid-market or somewhat high-end, and it made an interesting foray into technical publishing with its acquisition of Arbortext that will complement Windchill. What all this indicates is a market that continues its state of flux, but proves that there is money to be made by this diverse set of players.
So, while 2005 was a good year for the big CAx players, the big question is, can they sustain their good fortunes this year and beyond? I see the biggest growth potential as a result of the continuing consolidation of the CAx industry. That is, growth due to mergers and acquisitions, rather than just organic growth from within. Like virtually all industries, strong engineering software companies with products and services that customers want will continue to prosper, while those that don't won't fare so well or, ultimately, survive.
Dassault Systemes Reports Record Revenue And Earnings In 2005
Dassault Systemes (DS) reported financial results for both the fourth quarter and full year ended December 31, 2005.
Fourth Quarter and Full Year Highlights
Bernard Charles, Dassault Systemes' President and Chief Executive Officer, commented, "Dassault Systemes had a great finish to a very successful year. During 2005 revenues increased 18% and earnings rose 17%. These achievements reflect the powerful combination of significant V5 PLM implementations, the competitive advantages of our brands and the strong performance of our alliance with IBM, our partners and our investments.
"Our largest brand CATIA, for design excellence, had a good year. Our PDM solutions, with ENOVIA for collaborative lifecycle management and SMARTEAM for TeamPDM, delivered 20% revenue growth and added more than 1,000 new customers. DELMIA, for production performance, had strong revenue growth as it also broadened its customer base. And our newest brand, SIMULIA, for virtual simulation, had a remarkable start. SolidWorks, addressing the Mainstream 3D market, continued to demonstrate the strength of its offerings, delivering 25% revenue growth. The SolidWorks community continued its expansion, approaching the half million users' milestone at the end of 2005.
"At the heart of our vision is our belief in the power, enormous potential and pervasive applicability of 3D technology to enhance communication, businesses and the environment at large."
Fourth Quarter Financial Results Highlights
GAAP total revenue of EUR 304.2 million (up 27%) and GAAP EPS of EUR 0.58 (up 14%)
Software and service revenue represented 83% and 17% of non-GAAP total revenue in the fourth quarter of 2005.
In the 2005 fourth quarter, Non-GAAP software revenue increased 27% to EUR 261.3 million and increased 24% in constant currencies on strong growth across all the Company's software applications and the inclusion of ABAQUS. In the year-ago quarter software revenue was EUR 206.4 million. New CATIA and SolidWorks seats licensed in the 2005 fourth quarter increased 14% to 22,484 seats, compared to 19,726 seats in the year-ago quarter.
2005 fourth quarter, CATIA licenses increased 6% year over year to 11,416.
In the Mainstream market, SolidWorks revenue increased 26% as reported and 23% in constant currencies to EUR 51.9 million in the 2005 fourth quarter, compared to EUR 41.3 million in the year-ago period. SolidWorks seats licensed increased 24% to 11,068 licenses.
As anticipated, service and other revenue increased significantly in the fourth quarter. Specifically, service and other revenue increased 55% as reported to EUR 52.0 million and increased 52% in constant currencies, compared to EUR 33.5 million in the fourth quarter of 2004.
Full Year Financial Results Highlights
of Non-GAAP total revenue with service and other revenue accounting for 16%. Recurring licenses revenue continued to represent a large component of Non-GAAP software revenue, representing 50% of Non-GAAP software revenue in 2005. Total CATIA and SolidWorks seats licensed in 2005 were 72,078, representing an increase of 15% above 2004 where seats licensed totaled 62,577. Seat pricing trends for the full year 2005 remained stable in comparison to 2004.
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-- Jeff Rowe, MCADCafe.com Contributing Editor.
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