Dassault Systèmes Reports First Half Revenue Growth of 15.2%

The Tip Desk · June 30, 2012 · 2 min read

The software company saw operating profit rise 26.4% during the first six months of 2012.

Dassault Systèmes, the software maker, reported a 15.2% increase in revenue for the first half of 2012. The company said this growth was supported by a 15.4% rise in software sales and a 13.0% increase in services and other revenue. Currency fluctuations had a significant impact, adding 5 percentage points to the revenue growth.

Operating profit rose 26.4% to 232.6 million euros. The company attributed this result primarily to the revenue increase and the efficiency of its business management. The operating margin improved by 210 basis points to 24.1%. In non-IFRS terms, operating profit increased 19.5% to 282.3 million euros, with a non-IFRS operating margin of 29.2%.

Growth varied across business segments and regions. The SOLIDWORKS segment saw revenue increase 20.8% in published data and 14% at constant exchange rates. This was driven by double-digit growth in both new licenses and maintenance. New SOLIDWORKS licenses rose 13% to 27,252 units. The PLM segment revenue grew approximately 14% in published data and 9% at constant exchange rates.

Geographically, Asia recorded the highest growth at 18.4%. The company noted that performance in high-growth countries, specifically China and Korea, drove new license growth to double digits in that region. Europe saw revenue increase 15.2%.

Operating expenses rose 12.0%. The company said this was mainly due to an increase in total headcount and investments to improve brand visibility. Commercial expenses increased by 51.0 million euros, reflecting higher advertising costs and a 5% increase in the average number of employees dedicated to marketing and sales. Research and development expenses rose by 19.4 million euros, which the company attributed to a 6% increase in the average number of employees and higher salaries.

Net income attributable to the Group rose 22.0%. Diluted net income per share increased 21.4% to 1.25 euro. The company reported operating cash flows of 353.8 million euros for the first half of 2012, compared to 281.4 million euros in the first half of 2011. Net cash, including cash equivalents and short-term investments minus long-term debt and a 200 million euro current debt, stood at 1.39 billion euros as of June 30, 2012.

During the period, the company spent 19.1 million euros on external growth, including the acquisition of Netvibes. On July 11, 2012, the company finalized the acquisition of Gemcom for approximately 292 million euros in cash, less assumed liabilities.

Financial objectives for the remainder of 2012 include prudent growth assumptions for the second half, particularly the fourth quarter. The company expects revenue and new license sales in the second half of 2012 to increase at a lower rate than in the first half, citing a more uncertain macroeconomic environment and lower GDP growth in many countries.