Dassault Systemes Reports Excellent EPS Growth on Revenues of EUR 192.5 Million as Second Quarter Performance Exceeds Objectives.PARIS Paris, in Greek mythology Paris or Alexander, in Greek mythology, son of Priam and Hecuba and brother of Hector. Because it was prophesied that he would cause the destruction of Troy, Paris was abandoned on Mt. -- Dassault Systemes Dassault Systemes (Dassault Systèmes S.A.) (Pronounced - Dasoh) (NASDAQ: DASTY; Euronext: 13065) is a leading company specializing in 3D and PLM (Product Lifecycle Management) software. (DS) (Nasdaq:DASTY; Euronext Paris Euronext Paris is France's securities market, formerly known as the Paris Bourse, which merged with the Amsterdam and Brussels exchanges in September 2000 to form Euronext NV, which is the second largest exchange in Europe behind the London Stock Exchange. : #13065, DSY DSY Drum Storage Yard .PA), a worldwide leading software developer of product lifecycle Product lifecycle or product life cycle is the course of a product's sales and profits over time. The five stages of each product lifecycle are product development, introduction, growth, maturity and decline. management (PLM (Product Life cycle Management) A comprehensive information system that coordinates all aspects of a product from initial concept to its eventual retirement. Sometimes called the "digital backbone" of a product, it includes the requirements phase, analysis and design ) solutions, reported financial results for the second quarter and six months ended June June: see month. 30, 2004. Second Quarter Financial Highlights --Total revenue EUR EUR In currencies, this is the abbreviation for the Euro. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 192.5 million, up 6% as reported and up 8% in constant currencies --Software revenue EUR 158.9 million, up 5% as reported and up 6% in constant currencies --PDM revenue up 11% as reported and up 13% in constant currencies --Design-centric revenue up 19% as reported (up 26% in U.S. dollars) --EPS EUR 0.31 on U.S. GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). basis --EPS excluding acquisition costs up 19% to EUR 0.31 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share "Dassault Systemes has delivered another good quarter. Our strong performance has solid and consistent underpinnings. In the design-centric market, SolidWorks SolidWorks is a 3D mechanical CAD (computer-aided design) program that runs on Microsoft Windows and was developed by SolidWorks Corporation - now a subsidiary of Dassault Systèmes, S. A. (Suresnes, France). continues to offer the compelling benefits of its software solutions to 2D users migrating to 3D, as illustrated by its 26% revenue growth in U.S. dollars. Our PDM (1) (Product Data Management) An information system used to manage the data for a product as it passes from engineering to manufacturing. The data includes plans, geometric models, CAD drawings, images, NC programs as well as all related project data, notes and business, with 13% revenue growth (in constant currencies), constitutes one of the key elements of our integrated V5 PLM offer which aims to increase innovation by creating a truly collaborative col·lab·o·rate intr.v. col·lab·o·rat·ed, col·lab·o·rat·ing, col·lab·o·rates 1. To work together, especially in a joint intellectual effort. 2. environment for Product Lifecycle Management," commented Bernard Charles Bernard Charles is the CEO of Dassault Systemes. References
Mr. Charles Charles, archduke of Austria Charles, 1771–1847, archduke of Austria; brother of Holy Roman Emperor Francis II. Despite his epilepsy, he was the ablest Austrian commander in the French Revolutionary and Napoleonic wars; however, he was handicapped by added, "We are seeing signs of higher demand and renewed re·new v. re·newed, re·new·ing, re·news v.tr. 1. To make new or as if new again; restore: renewed the antique chair. 2. growth as companies are increasing their investments in an expanding PLM market. We are entering the second half of the year with good visibility and a high level of confidence based upon discussions with customers and sales channels. We are raising our 2004 growth objectives for revenue, operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. and earnings to reflect our higher than anticipated second quarter results." Revenue Total revenue increased 6% to EUR 192.5 million as reported and increased 8% in constant currencies in the second quarter of 2004 compared to the year-ago quarter. In the 2004 second quarter software revenue increased 5% as reported and 6% in constant currencies with service revenue increasing 14% as reported and 16% in constant currencies, both in comparison to the year-ago period. The increase in software revenue reflected growth of PLM software solutions as well as design-centric software solutions. Service revenue increased sharply reflecting work on the 7E7 project with Boeing (language) BOEING - An early system on the IBM 1130. [Listed in CACM 2(5):16, May 1959]. , and an increase in PLM projects in general, including a number of projects focused on best practices. Software revenue, representing 83% of total revenue, totaled EUR 158.9 million in the second quarter of 2004, compared to EUR 151.8 million in the second quarter of 2003. Recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. software revenue represented 54% of total software revenue in the second quarter of 2004. New CATIA A family of 2D and 3D CAD programs from IBM. CATIA was one of the first CAD programs to provide 3D solid modeling. The program was developed by Dassault Systems, a French aerospace company. and SolidWorks seats licensed in the second quarter of this year increased 9% to 14,767 seats, compared to 13,568 seats in the year-ago period. CATIA and SolidWorks licenses increased 4% and 15%, respectively. Service revenue, representing 17% of total revenue, was EUR 33.6 million in the second quarter, up from EUR 29.5 million in the year-ago quarter. Thibault de Tersant, Executive Vice President and CFO See Chief Financial Officer. of Dassault Systemes, commented, "Regionally, Asia continues to lead delivering year-over-year growth of 12% in constant currencies reflecting strong interest in our PLM and design-centric software solutions. For the second consecutive quarter, Europe's revenue results exceeded our expectations, with revenue growing 6%. The economic signals continue to be somewhat mixed in the Americas A·mer·i·cas , the See America. , where our growth this quarter was about 7% in constant currencies." Process-centric revenue, including PDM revenue, totaled EUR 155.5 million in the second quarter, an increase of 4% as reported and an increase of 5% in constant currencies in comparison to the year-ago quarter. PDM revenue increased 11% as reported and 13% in constant currencies in comparison to the year-ago period. PDM revenues totaled EUR 22.5 million in the second quarter of 2004 and represented 12% of total revenue. PDM end-user (job) end-user - The person who uses a computer application, as opposed to those who developed or support it. The end-user may or may not know anything about computers, how they work, or what to do if something goes wrong. software revenue totaled US$35.2 million in the second quarter of 2004. PLM orders in the second quarter included repeat orders from large accounts for PLM deployment Installing, setting up, testing and running. This military term, which means the placement of troops and equipment in the field, is widely used with computers as an alternate to the word "implementation. as well as further penetration The successful unauthorized breach of a security perimeter. See penetration test. of the SMB markets See SMB. . Among the new PLM orders were such customers as Sukhoi Sukhoi (pronounced [soo-hoi]) (Сухой) is a major Russian military fighter aircraft manufacturer. Founded by Pavel Sukhoi in 1939 as the Sukhoi Design Bureau (OKB-51, design office prefix Su), it is currently known as Civil Aircraft in Russia Russia, officially the Russian Federation, Rus. Rossiya, republic (2005 est. pop. 143,420,000), 6,591,100 sq mi (17,070,949 sq km). , Beiqi Foton Foton (or Photon) is the project name of two series of Russian science satellite programs. Although unmanned, the design was adapted from the manned Vostok spacecraft capsule. Motor in China, Kikuchi Kikuchi, often written 菊池, can refer to: Several places in Japan:
In the second quarter of 2004 design-centric revenue increased 19% to EUR 37.0 million, up from EUR 31.2 million in the year-ago quarter and increased 26% if reported in U.S. dollars. SolidWorks' wins in the second quarter included Sulzer Sulzer may refer to:
 k`dŭn), city (1994 est. pop. 3,762,000), capital of Liaoning prov., NE China, on the Hun River. Heavy Machinery in
China.Operating Income and Margin, EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. and Financial Position Revenue growth again translated into operating leverage Operating Leverage A measurement of the degree to which a firm or project relies on fixed rather than variable costs. Notes: The higher the degree of operating leverage, the greater the potential danger from forecasting risk. with strong increases in the Company's operating income, operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: , net income and earnings per share in the second quarter. Operating income increased 15% to EUR 52.5 million in the second quarter of 2004 (27.3% operating margin), compared to EUR 45.6 million in the second quarter of 2003 (25.2% operating margin). Operating income before acquisition costs increased 13% to EUR 53.0 million in the second quarter, up from EUR 47.0 million in the year-ago period. The operating margin before acquisition costs increased 1.6 percentage points to 27.5% in the second quarter of 2004, compared to the year-ago quarter where the operating margin was 25.9% before acquisition costs. Earnings per share increased 24% to EUR 0.31 per diluted share in the second quarter of 2004, up from EUR 0.25 per diluted share in the second quarter of 2003. Earnings per share before acquisition costs increased 19% to EUR 0.31 per diluted share in the second quarter of 2004, up from EUR 0.26 per diluted share in the year-ago quarter. The sharp increase in earnings per share, as reported and before acquisition costs, reflected the growth in revenue and strong increase in operating income as well as a higher level of financial revenue. Net income increased 27% to EUR 35.8 million, in the recently completed quarter, compared to EUR 28.2 million in the year-ago quarter. Net income before acquisition costs increased 25% to EUR 36.5 million in the second quarter of 2004, compared to EUR 29.3 million in the respective 2003 quarter. Dassault Systemes continued to maintain a strong financial position with cash and short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. investments totaling EUR 544.6 million at June 30, 2004, after payment of cash dividends totaling EUR 38 million. Net cash provided by operations was EUR 34.6 million for the second quarter of 2004. First Half Financial Highlights --Total revenue EUR 368.7 million, up 5% as reported and up 9% in constant currencies --Software revenue EUR 307.8 million, up 4% as reported and up 8% in constant currencies --Process-centric revenue EUR 299.1 million, up 3% as reported and up 7% in constant currencies --PDM revenue EUR 42.4 million, up 13% as reported and up 17% in constant currencies --Design-centric revenue EUR 69.6 million, up 13% as reported (up 25% in U.S. dollars) --EPS EUR 0.55 on U.S. GAAP basis --EPS excluding acquisition costs up 19% to EUR 0.56 per diluted share Strategy, Technology and Partnerships DS and IBM (International Business Machines Corporation, Armonk, NY, www.ibm.com) The world's largest computer company. IBM's product lines include the S/390 mainframes (zSeries), AS/400 midrange business systems (iSeries), RS/6000 workstations and servers (pSeries), Intel-based servers (xSeries) introduced a new specialized spe·cial·ize v. spe·cial·ized, spe·cial·iz·ing, spe·cial·iz·es v.intr. 1. To pursue a special activity, occupation, or field of study. 2. product lifecycle management industry solution (including software and best practices) for Electronics manufacturers, designed to help them better manage the growing complexity of electronic product development. Collaborative Systems Engineering for Electronics (CSE-E) optimizes the early definition stages of product development when companies establish the requirements, functions and systems architecture of a new product, and generally commit up to 80% of its cost. CSE-E also shortens time-to-market by facilitating design reuse reuse - Using code developed for one application program in another application. Traditionally achieved using program libraries. Object-oriented programming offers reusability of code via its techniques of inheritance and genericity. from the earliest stages of the development process, and reduces the costs and risks associated with the launch of a new product. DS and Lattice (theory) lattice - A partially ordered set in which all finite subsets have a least upper bound and greatest lower bound. This definition has been standard at least since the 1930s and probably since Dedekind worked on lattice theory in the 19th century; though he may not Technology have entered into a long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. strategic partnership to create a significantly more open and efficient 3D XML XML in full Extensible Markup Language. Markup language developed to be a simplified and more structural version of SGML. It incorporates features of HTML (e.g., hypertext linking), but is designed to overcome some of HTML's limitations. solution enabling the exchange of 3D data among manufacturers and suppliers, partners and customers. Using Lattice Technology's applications, users will be able to generate 3D manuals, parts lists, marketing brochures, assembly instructions, and parts databases. The solutions will provide functions to create 3D interactive Web pages or office documents enabling users to combine 3D data, 2D images, structured data, text and graphics together in a single lightweight Use in English The word lightweight is conserderd one of the most insulting words in the English language. Is is the only word in the English language is every part of speech at the same time. One lightweight of note is Jason. document. Founded in 1997 with headquarters in Tokyo Tokyo (tō`kēō), city (1990 pop. 8,163,573), capital of Japan and of Tokyo prefecture, E central Honshu, at the head of Tokyo Bay. , Japan, Lattice Technology provides global companies with proven solutions for the propagation The transmission (spreading) of signals from one place to another. of 2D/3D design data across the enterprise. SolidWorks(R) 2005 was introduced delivering new features to make design engineers and others faster, more accurate and more productive as they bring their innovations to market. SolidWorks 2005 software delivers powerful drawing capabilities, significant ease of use, and a number of new productivity features. With more than 250 customer-requested features and enhancements SolidWorks 2005 includes significant new features for machine, mold mold, name for certain multicellular organisms of the various classes of the kingdom Fungi, characteristically having bodies composed of a cottony mycelium. The colors of molds are caused by the spores, which are borne on the mycelium. and consumer product designers. SolidWorks 2005 uniquely encompasses 3D design, analysis, product data management, collaboration Working together on a project. See collaborative software. , and injection-molded plastic part validation See validate. validation - The stage in the software life-cycle at the end of the development process where software is evaluated to ensure that it complies with the requirements. software in a single offering. DS and Rand Rand See Witwatersrand. rand 1 n. See Table at currency. [Afrikaans, after(Witwaters)rand. A Technology Corporation, operating as RAND Worldwide, have completed the creation of RAND North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , Inc. (Rand Americas), a new joint venture focused on increasing sales of DS PLM software in North America. Annual Shareholders' Meeting shareholders' meeting n. a meeting, usually annual, of all shareholders of a corporation (although in large corporations only a small percentage attend) to elect the Board of Directors and hear reports on the company's business situation. Summary The Annual Shareholders' Meeting was held on June 2, 2004. Shareholders approved an increase of 3% in the cash dividend to EUR 0.34 per share (excluding avoir fiscal) for the fiscal year ended December December: see month. 31, 2003. Cash dividends, totaling EUR 38 million in the aggregate and representing approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 28% of 2003 net income, were paid on June 22, 2004. Charles Edelstenne, Chairman of Dassault Systemes, concluded, "Our focus is on bringing value to our shareholders by delivering on our financial objectives, consistently investing in our future and sharing a significant portion of the net income of the Company with shareholders." Business Outlook "We are increasing our 2004 growth objectives for revenue and EPS before acquisition costs to reflect the higher than anticipated level of activity in the second quarter. Our revenue growth objective is about 9% in constant currencies, and our EPS before acquisition costs objective is 13% to 15% growth in constant currencies," Thibault de Tersant stated. "For the purposes of calculating reported revenue, operating margin and EPS objectives, we are maintaining our previous assumption of a U.S. dollar to euro exchange rate of $1.25 per EUR 1.00 leading to a reported revenue objective of about EUR 795 million, up from EUR 785 million and an EPS before acquisition costs objective of about EUR 1.33 - EUR 1.35 for 2004, up from EUR 1.30 - EUR 1.32 previously. "Based upon our first half results and second half outlook, our operating margin before acquisition costs is likely to be slightly better than our 2003 operating margin of 29.0%. Our revenue objective for the third quarter is about EUR 183 - EUR 188 million, based upon a U.S. dollar to Euro exchange rate of $1.25 per EUR 1.00," Thibault de Tersant concluded. Major Press Release Highlights
----------------------------------------------------------------------
July 9, 2004. Start magazine names SolidWorks one of manufacturing's
'hottest' companies for third time in four years.
----------------------------------------------------------------------
July 9, 2004. Cosmos 2005 packs 100 enhancements and advanced
analysis into affordable, easy-to-use applications.
----------------------------------------------------------------------
June 23, 2004. CENIT AG Systemhaus Achieves Dassault Systemes
Certified Education Partner Status.
----------------------------------------------------------------------
May 25, 2004 Tata Technologies, IBM and Dassault Systemes Join
Forces to Meet Growing Demand for PLM Solutions in
India.
----------------------------------------------------------------------
May 24, 2004 Dassault Aviation and Dassault Systemes Make Industry
History - Falcon 7X Jet Becomes First Aircraft
Entirely Developed on Virtual Platform.
----------------------------------------------------------------------
May 19, 2004. French Yacht Architectural Firm Berret-Racoupeau
Chooses PLM Solutions from Dassault Systemes and IBM.
----------------------------------------------------------------------
May 17, 2004 Dassault Systemes, Hong Kong Polytechnic University
and MTECH Extend Partnership
----------------------------------------------------------------------
May 6, 2004. Russia's Sukchoi Civil Aircraft to Develop Regional
Jet Fleet Using PLM Solutions from Dassault Systemes
and IBM.
----------------------------------------------------------------------
May 5, 2004 Whirlpool Adopts Digital Manufacturing Solutions from
Delmia Corp.
----------------------------------------------------------------------
May 4, 2004 Enovia Corp. and Galaxia Inc. Form CAA V5 Software
Partnership for Enterprise Collaborative Business
Process Management Applications
----------------------------------------------------------------------
April 26, 2004. MSC.Software Becomes First Dassault Systemes'
Certified Education Partner in the Americas.
----------------------------------------------------------------------
April 21, 2004. AVIC Information Technology Opens Competency Center in
China for Dassault Systemes PLM Solutions.
----------------------------------------------------------------------
Endnotes:
1. All comparative figures are given on a year-over-year basis
unless specified otherwise.
2. All financial information is unaudited and reported in
accordance with U.S. generally accepted accounting principles
(U.S. GAAP). Additional financial information is also
presented that is not in conformity with U.S. GAAP, in
particular the presentation of operating income, operating
margin and earnings per share before acquisition costs
(acquisition costs are primarily comprised of technology
amortization in addition to other acquisition- related costs).
The Company has provided in the tables to this press release
and on its website
http://www.3ds.com/en/investors/presentation.asp
reconciliations between U.S. GAAP and non-U.S. GAAP figures.
3. The Company uses constant currency revenue growth to evaluate
its financial performance in comparison to prior periods and
as a measure of expected growth in planning and setting
objectives for future periods. The Company believes this
measure is an important indicator of the Company's progress
and outlook because it provides a better gauge of the level of
change in the business activity as it eliminates any changes
arising from currency fluctuations. The Company believes the
presentation of this measure is relevant and useful for
investors because it allows investors to view revenue growth
in a manner similar to the method used by the Company's
management, helps improve investors' ability to understand the
Company's revenue growth, and makes it easier to compare DS'
results with other companies, including competitors, whose
reporting currency may be different from DS. Constant currency
revenue growth, as calculated by the Company, may not be
comparable to similarly titled measures employed by other
companies.
Conference call information The Company will host a teleconference call today, Thursday Thursday: see week. , July July: see month. 29, 2004 at 4:00 PM CET/3:00 PM London/10:00 AM New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of . The conference call will be available via the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the by accessing http://www.3ds.com/en/investors/index.asp. Please go to the website at least fifteen minutes prior to the call to register, download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. and install any necessary audio software. The webcast teleconference will be archived for 30 days. Financial information to be discussed in the call will be available on the Company's website prior to commencement of the teleconference http://www.3ds.com/en/investors/earnings.asp. Additional investor information can be accessed at http://www.3ds.com/en/investors/index.asp or by calling Dassault Systemes' Investor Relations Investor relations The process by which the corporation communicates with its investors. at 33.1.40.99.69.24. Statements above that are not historical facts but express expectations or objectives for the future, including but not limited to statements regarding the Company's objectives for 2004 third quarter revenue, 2004 revenue growth in constant currencies, 2004 reported revenue growth, 2004 operating margin growth objective before acquisition costs and 2004 EPS objective before acquisitions costs are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. (within the meaning of Section 21E of the 1934 Securities Exchange Act, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. ). Such forward-looking statements are based on 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, among other factors: (i) currency fluctuations, (ii) global economic conditions, (iii) market demand for our products and services, (iv) new product developments and technological changes, and (v), our ability to recruit RECRUIT. A newly made soldier. and retain skilled personnel. Unfavorable changes in any of the above or other factors described in the Company's SEC reports, including the Form 20-F for the year ended December 31, 2003, which was filed with the SEC on June 30, 2004, could materially affect the Company's financial position or results of operations. About Dassault Systemes As world leader in PLM (Product Lifecycle Management) solutions, the Dassault Systemes group brings value to more than 70,000 customers in 80 countries. A pioneer in the 3D software market since 1981, Dassault Systemes develops and markets PLM application software and services that support industrial processes and provide a 3D vision of the entire life cycle of products from conception conception /con·cep·tion/ (kon-sep´shun) 1. an imprecise term denoting the formation of a viable zygote.concep´tive 2. concept. con·cep·tion n. 1. to maintenance. Its offering includes integrated PLM solutions for product development (CATIA(R), DELMIA DELMIA Digital Enterprise Lean Manufacturing Interactive Application (R), ENOVIA(R), SMARTEAM(R)), mainstream product design tools (SolidWorks(R)), and 3D components (ACIS(R)) from Spatial Corp Spatial Corporation was founded in 1986, and had one main product: ACIS, the first commercially available 3D modeling kernel. Through subsequent years, Spatial added products to its portfolio that enabled ISVs mostly in the CAD/CAM industries, to build applications. . Dassault Systemes is listed on the Nasdaq (DASTY) and Euronext Paris (#13065, DSY.PA) stock exchanges. For more information, visit http://www.3ds.com
(Tables to follow)
DASSAULT SYSTEMES
NON-U.S. GAAP KEY FIGURES
2nd QUARTER
-----------
in millions of Euro, except per share data, headcount and exchange
rates.
2Q04 2Q03 Variation
------------------------------
Process-Centric excluding PDM 133.0 129.8 2%
PDM 22.5 20.3 11%
Design-Centric 37.0 31.2 19%
Revenue 192.5 181.3 6%
Americas 52.2 51.6 1%
Europe 86.1 81.4 6%
Asia 54.2 48.3 12%
Operating Income (1) 53.0 47.0 13%
Operating Margin (1) 27.5% 25.9%
Net Income (1) 36.5 29.3 25%
EPS (1) 0.31 0.26 19%
Closing Headcount 4,263 4,051 5%
Average Rate USD per Euros 1.20 1.14 6%
Average Rate JPY per Euros 132 135 (2%)
(1) Excluding acquisition costs. For U.S. GAAP figures, please refer
to reconciliation tables
1st HALF
--------
in millions of Euro, except per share data, headcount and exchange
rates.
1H04 1H03 Variation
------------------------------
Process-Centric excluding PDM 256.7 251.4 2%
PDM 42.4 37.6 13%
Design-Centric 69.6 61.7 13%
Revenue 368.7 350.7 5%
Americas 101.7 102.6 (1%)
Europe 168.0 159.8 5%
Asia 99.0 88.3 12%
Operating Income (1) 96.5 83.8 15%
Operating Margin (1) 26.2% 23.9%
Net Income (1) 65.1 53.5 22%
EPS (1) 0.56 0.47 19%
Average Rate USD per Euros 1.23 1.10 11%
Average Rate JPY per Euros 133 131 1%
(1) Excluding acquisition costs. For U.S. GAAP figures, please refer
to reconciliation tables
DASSAULT SYSTEMES
CONSOLIDATED STATEMENT OF INCOME DATA PREPARED IN ACCORDANCE
WITH U.S. GAAP
(in millions of Euro, except per share data)
Three Months Ended Six Months Ended
June 30, 2004 June 30, 2003 June 30, 2004 June 30, 2003
------------- ------------- ------------- -------------
Software 158.9 151.8 307.8 296.9
Service and
Other 33.6 29.5 60.9 53.8
------------- ------------- ------------- -------------
Total
Revenue EUR 192.5 EUR 181.3 EUR 368.7 EUR 350.7
Software 5.0 5.6 9.8 11.4
Service and
Other 25.9 24.6 50.6 46.5
------------- ------------- ------------- -------------
Total Cost of
Revenue EUR 30.9 EUR 30.2 EUR 60.4 EUR 57.9
Gross
Profit EUR 161.6 EUR 151.1 EUR 308.3 EUR 292.8
Research and
Development 53.4 52.6 107.5 106.2
Marketing and
Sales 43.2 40.1 81.0 79.7
General
Administration 12.0 11.4 23.3 23.1
Acquisition
Costs 0.5 1.4 1.1 3.5
------------- ------------- ------------- -------------
Total Research,
Selling,
Administration
and
Acquisition EUR 109.1 EUR 105.5 EUR 212.9 EUR 212.5
expenses ============= ============= ============= =============
Operating
Income (1) EUR 52.5 EUR 45.6 EUR 95.4 EUR 80.3
Financial
revenue and
Other 2.8 (0.4) 4.2 1.6
Income before
income taxes 55.3 45.2 99.6 81.9
Income tax
expense (19.5) (17.0) (35.6) (31.4)
------------- ------------- ------------- -------------
Net
Income (1) EUR 35.8 EUR 28.2 EUR 64.0 EUR 50.5
============= ============= ============= =============
Basic net
income per
share EUR 0.32 EUR 0.25 EUR 0.57 EUR 0.45
============= ============= ============= =============
Diluted net
income per
share (1) EUR 0.31 EUR 0.25 EUR 0.55 EUR 0.44
============= ============= ============= =============
Basic weighted
average shares
outstanding
(in millions) 113.2 112.8 113.1 113.2
============= ============= ============= =============
Diluted
weighted
average
shares
outstanding
(in millions) 116.1 114.1 116.0 114.0
(1) Excluding acquisition costs, operating income and net income
would have been as follows:
Operating
Income EUR 53.0 EUR 47.0 EUR 96.5 EUR 83.8
============= ============= ============= =============
Net Income EUR 36.5 EUR 29.3 EUR 65.1 EUR 53.5
============= ============= ============= =============
Diluted net
income per
share EUR 0.31 EUR 0.26 EUR 0.56 EUR 0.47
============= ============= ============= =============
Supplemental Disclosures Regarding Non-U non-U adj. Chiefly British Not characteristic of the upper class, especially in language usage. [non- + U2. .S. GAAP Financial Information: Excluding Acquisition Costs The following tables set forth the Company's Consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: Statement of Income Data excluding acquisition costs for the three months and six months ended June 30, 2004. In particular, the tables present operating income, operating margin and earnings per share before acquisition costs (acquisition costs are primarily comprised of technology amortization in addition to other acquisition-related costs). The Company uses these non-U.S. GAAP measures, among other things, to evaluate the Company's operating performance and for planning and setting objectives for future periods. The Company believes these non-U.S. GAAP measures are useful to investors because they provide an alternative method for measuring the operating performance of the Company's business by isolating i·so·late tr.v. i·so·lat·ed, i·so·lat·ing, i·so·lates 1. To set apart or cut off from others. 2. To place in quarantine. 3. the effect of acquisition costs, which do not impact the underlying business. In addition, these measures are among the primary measures used externally by analysts for purposes of valuation and the comparing operating performance of the Company to other companies in the industry. Since these measures of performance are not calculated in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with U.S. GAAP, they should not be considered in isolation of, or as a substitute for, operating income, operating margin and earnings per share including acquisition costs, as an indicator Indicator Anything used to predict future financial or economic trends. Notes: In the context of technical analysis, an indicator is a mathematical calculation based on a securities price and/or volume. The result is used to predict future prices. of operating performance.
DASSAULT SYSTEMES
NON-U.S. GAAP CONSOLIDATED STATEMENT OF INCOME DATA
PERCENTAGE VARIANCE
(EXCLUDING ACQUISITION COSTS)
(in millions of Euro, except per share data)
Three Months Ended
June 30, 2004 June 30, 2003 Variation
---------------- --------------- ---------
Software 158.9 151.8 4.7%
Service and Other 33.6 29.5 13.9%
---------------- ---------------
Total Revenue EUR 192.5 EUR 181.3 6.2%
Software 5.0 5.6 (10.7%)
Service and Other 25.9 24.6 5.3%
---------------- ---------------
Total Cost of Revenue EUR 30.9 EUR 30.2 2.3%
Gross Profit EUR 161.6 EUR 151.1 6.9%
Research and Development 53.4 52.6 1.5%
Marketing and Sales 43.2 40.1 7.7%
General Administration 12.0 11.4 5.3%
---------------- ---------------
Total Research, Selling,
Administration EUR 108.6 EUR 104.1 4.3%
================ ===============
Operating Income EUR 53.0 EUR 47.0 12.8%
Financial revenue and Other 2.8 (0.4) N/S
Income before income taxes 55.8 46.6 19.7%
Income tax expense (19.3) (17.3) N/S
---------------- ---------------
Net Income EUR 36.5 EUR 29.3 24.6%
================ ===============
Diluted net income per
share EUR 0.31 EUR 0.26 19.2%
================ ===============
Diluted weighted average
shares outstanding
(in millions) 116.1 114.1
DASSAULT SYSTEMES
CONSOLIDATED STATEMENT OF INCOME DATA
RECONCILIATIONS NON-U.S. GAAP / U.S. GAAP
(in millions of Euro, except per share data)
Three Months Ended
June 30, 2004
--------------------------------------
Excluding
Reported Acquisition Acquisition
Amount Costs Costs
------------ ----------- ------------
Software 158.9 158.9
Service and Other 33.6 33.6
------------ ------------
Total Revenue EUR 192.5 EUR 192.5
Software 5.0 5.0
Service and Other 25.9 25.9
------------ ------------
Total Cost of Revenue EUR 30.9 EUR 30.9
Gross Profit EUR 161.6 EUR 161.6
Research and Development 53.4 53.4
Marketing and Sales 43.2 43.2
General Administration 12.0 12.0
Acquisition Costs 0.5 (0.5) -
------------ ------------
Total Research, Selling,
Administration EUR 109.1 EUR 108.6
============ ============
Operating Income EUR 52.5 EUR 53.0
Financial revenue and Other 2.8 2.8
Income before income taxes 55.3 55.8
Income tax expense (19.5) 0.2 (19.3)
------------ ------------
Net Income EUR 35.8 EUR 36.5
============ ============
Diluted net income per share EUR 0.31 EUR 0.31
============ ============
Diluted weighted average shares
outstanding (in millions) 116.1 116.1
June 30, 2003
--------------------------------------
Excluding
Reported Acquisition Acquisition
Amount Costs Costs
------------ ----------- ------------
Software 151.8 151.8
Service and Other 29.5 29.5
------------
Total Revenue EUR 181.3 EUR 181.3
Software 5.6 5.6
Service and Other 24.6 24.6
------------ ------------
Total Cost of Revenue EUR 30.2 EUR 30.2
Gross Profit EUR 151.1 EUR 151.1
Research and Development 52.6 52.6
Marketing and Sales 40.1 40.1
General Administration 11.4 11.4
Acquisition Costs 1.4 (1.4) -
------------ ------------
Total Research, Selling,
Administration EUR 105.5 EUR 104.1
============ ============
Operating Income EUR 45.6 EUR 47.0
Financial revenue and Other (0.4) (0.4)
Income before income taxes 45.2 46.6
Income tax expense (17.0) (0.3) (17.3)
------------ ------------
Net Income EUR 28.2 EUR 29.3
============ ============
Diluted net income per share EUR 0.25 EUR 0.26
============ ============
Diluted weighted average shares
outstanding (in millions) 114.1 114.1
DASSAULT SYSTEMES
NON-U.S. GAAP CONSOLIDATED STATEMENT OF INCOME DATA
PERCENTAGE VARIANCE
(EXCLUDING ACQUISITION COSTS)
(in millions of Euro, except per share data)
Six Months Ended
June 30, 2004 June 30, 2003 Variation
--------------- ----------------- ---------
Software 307.8 296.9 3.7%
Service and Other 60.9 53.8 13.2%
--------------- -----------------
Total Revenue EUR 368.7 EUR 350.7 5.1%
Software 9.8 11.4 (14.0%)
Service and Other 50.6 46.5 8.8%
--------------- -----------------
Total Cost of Revenue EUR 60.4 EUR 57.9 4.3%
Gross Profit EUR 308.3 EUR 292.8 5.3%
Research and Development 107.5 106.2 1.2%
Marketing and Sales 81.0 79.7 1.6%
General Administration 23.3 23.1 0.9%
--------------- -----------------
Total Research, Selling,
Administration EUR 211.8 EUR 209.0 1.3%
=============== =================
Operating Income EUR 96.5 EUR 83.8 15.2%
Financial revenue and Other 4.2 1.6 162.5%
Income before income taxes 100.7 85.4 17.9%
Income tax expense (35.6) (31.9) N/S
--------------- -----------------
Net Income EUR 65.1 EUR 53.5 21.7%
=============== =================
Diluted net income per
share EUR 0.56 EUR 0.47 19.1%
=============== =================
Diluted weighted average
shares outstanding (in
millions) 116.0 114.0
DASSAULT SYSTEMES
CONSOLIDATED STATEMENT OF INCOME DATA
RECONCILIATIONS NON-U.S. GAAP / U.S. GAAP
(in millions of Euro, except per share data)
Six Months Ended
June 30, 2004
-------------------------------------
Excluding
Reported Acquisition Acquisition
Amount Costs Costs
------------ ----------- ------------
Software 307.8 307.8
Service and Other 60.9 60.9
------------ ------------
Total Revenue EUR 368.7 EUR 368.7
Software 9.8 9.8
Service and Other 50.6 50.6
------------ ------------
Total Cost of Revenue EUR 60.4 EUR 60.4
Gross Profit EUR 308.3 EUR 308.3
Research and Development 107.5 107.5
Marketing and Sales 81.0 81.0
General Administration 23.3 23.3
Acquisition Costs 1.1 (1.1) -
------------ ------------
Total Research, Selling,
Administration EUR 212.9 EUR 211.8
============ ============
Operating Income EUR 95.4 EUR 96.5
Financial revenue and Other 4.2 4.2
Income before income taxes 99.6 100.7
Income tax expense (35.6) 0.0 (35.6)
------------ ------------
Net Income EUR 64.0 EUR 65.1
============ ============
Diluted net income per share EUR 0.55 EUR 0.56
============ ============
Diluted weighted average shares
outstanding (in millions) 116.0 116.0
June 30, 2003
-------------------------------------
Excluding
Reported Acquisition Acquisition
Amount Costs Costs
------------ ----------- ------------
Software 296.9 296.9
Service and Other 53.8 53.8
----------- ------------
Total Revenue EUR 350.7 EUR 350.7
Software 11.4 11.4
Service and Other 46.5 46.5
------------ ------------
Total Cost of Revenue EUR 57.9 EUR 57.9
Gross Profit EUR 292.8 EUR 292.8
Research and Development 106.2 106.2
Marketing and Sales 79.7 79.7
General Administration 23.1 23.1
Acquisition Costs 3.5 (3.5) -
------------ ------------
Total Research, Selling,
Administration EUR 212.5 EUR 209.0
============ ============
Operating Income EUR 80.3 EUR 83.8
Financial revenue and Other 1.6 1.6
Income before income taxes 81.9 85.4
Income tax expense (31.4) (0.5) (31.9)
------------ ------------
Net Income EUR 50.5 EUR 53.5
============ ============
Diluted net income per share EUR 0.44 EUR 0.47
============ ============
Diluted weighted average shares
outstanding (in millions) 114.0 114.0
DASSAULT SYSTEMES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions of Euro)
June 30, 2004 December 31, 2003
---------------- -------------------
ASSETS
Cash and short-term investments 544.6 439.7
Accounts receivable, net 154.7 227.6
Other assets 304.4 297.2
---------------- -------------------
Total assets EUR 1,003.7 EUR 964.5
LIABILITIES
AND SHAREHOLDERS' EQUITY
Total liabilities 312.1 306.8
Shareholders' equity 691.6 657.7
---------------- -------------------
Total liabilities and
shareholders' equity EUR 1,003.7 EUR 964.5
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