Dassault Systemes Reports Solid First Quarter Performance, with Revenue, Operating Margin and EPS above Objectives.Business Editors PARIS--(BUSINESS WIRE)--April 29, 2004 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 first quarter ended March 31, 2004. First 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. 176.2 million, up 4% as reported and up 10% in constant currencies -- Software revenue EUR 148.9 million, up 3% as reported and up 9% in constant currencies -- 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 revenue up 15% as reported and 22% in constant currencies -- Design-centric revenue up 7% as reported (up 25% in U.S. dollars) -- Operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: 24.3% and 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. EUR 0.24 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 0.25 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 in the 2004 first quarter on 3 percentage point operating margin improvement to 24.7% before acquisitions costs "The first quarter was a period of very solid performance for Dassault Systemes. Our financial results exceeded our objectives, with revenue, operating margin and earnings per share coming in higher than targeted. These results are mainly attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to our better than anticipated performance in Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). . We continued to benefit from our
diversification DiversificationA risk management technique that mixes a wide variety of investments within a portfolio. It is designed to minimize the impact of any one security on overall portfolio performance. Notes: Diversification is possibly the greatest way to reduce the risk. strategy, as illustrated by the good growth of our PDM business. 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). also had a good start to the year, with revenue increasing 25% in U.S. dollars during the first quarter. We are raising our revenue and earnings growth objectives for 2004 to reflect the fact that our first quarter came in above our objectives," commented Bernard Charles Bernard Charles is the CEO of Dassault Systemes. References
Revenue In the first quarter of 2004, total revenue increased 4% to EUR 176.2 million as reported and increased 10% in constant currencies, compared to the 2003 first quarter. Both software and services posted year-over-year growth as reported and in constant currencies. Software revenue increased 3% as reported and 9% in constant currencies in the 2004 first quarter in comparison to the first quarter of 2003. Software revenue, accounting for 85% of total revenue, totaled EUR 148.9 million in the first quarter of 2004, compared to EUR 145.1 million in the year-ago quarter. 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 56% of total software revenue in the 2004 first quarter. 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 2004 first quarter increased 9% to 14,082 seats, compared to 12,917 seats in the 2003 first quarter. Service revenue, representing 15% of total revenue, increased 12% to EUR 27.3 million in the 2004 first quarter, compared to EUR 24.3 million in the year-ago period. Thibault de Tersant, Executive Vice President and CFO See Chief Financial Officer. of Dassault Systemes, commented, "The Company continued the positive momentum from the second half of 2003, with software revenue showing year-over-year growth for the third quarter in a row. From a regional perspective, we are seeing signs of improvement in Europe slightly earlier than anticipated, with our revenue increasing 4% compared to the year-ago quarter. In the U.S., business activity continued to reflect the more positive trends of 2003, leading to 13% revenue growth in constant currencies for the Americas A·mer·i·cas , the See America. region in the first quarter. Asia, following on a very strong showing in the fourth quarter, achieved record revenue results in the first quarter with total revenue up 12% as reported and 19% in constant currencies in comparison to the first quarter of 2003. Within the Asian region, our strongest performance came from Japan, with a good level of activity from our PLM businesses and our design-centric segment." PLM performance in the first quarter improved over the year-ago period, led by activity in the aerospace end-market. Process-centric revenue, including PDM revenue, totaled EUR 143.6 million in the 2004 first quarter, an increase of 3% as reported and an increase of 9% in constant currencies. PDM revenue increased 15% as reported and 22% in constant currencies in comparison to the year-ago period. PDM revenues totaled EUR 19.9 million in the 2004 first quarter and represented 11% 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$33.5 million in the first quarter of 2004. PLM orders in the first quarter included customers such as The Boeing (language) BOEING - An early system on the IBM 1130. [Listed in CACM 2(5):16, May 1959]. Company, Beneteau
Beneteau is a French sail and motor boat manufacturer, with production facilities in the France and the U.S.. Group, Meyer Werft The Meyer Werft is one of the remaining large German shipyards, headquartered in Papenburg. Since 1997 it has been part of the Meyer Neptun Group together with Neptun Werft in Rostock. Shipyard and Sunten The introduction to this article provides insufficient context for those unfamiliar with the subject matter. Please help [ improve the introduction] to meet Wikipedia's layout standards. You can discuss the issue on the talk page. Electric Co. Ltd. Design-centric revenue totaled EUR 32.6 million in the 2004 first quarter, up 7% compared to the 2003 first quarter. Design-centric revenue increased 25% if reported in U.S. dollars, the reporting currency Reporting Currency The currency used in published reports and financial documents. Notes: All annual and quarterly reports state the currency in which their results are listed. of most of its competitors COMPETITORS, French law. Persons who compete or aspire to the same office, rank or employment. As an English word in common use, it has a much wider application. Ferriere, Dict. de Dr. h.t. . In addition to business with existing customers, SolidWorks added over 2,400 new customers in the quarter. 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 Margin, EPS and Financial Position As reported, operating income increased 24% to EUR 42.9 million in the first quarter of 2004 (24.3% operating margin), compared to EUR 34.7 million in the 2003 first quarter (20.5% operating margin). Operating income before acquisition costs increased 18% to EUR 43.5 million in the 2004 first quarter, up sharply from EUR 36.8 million in the 2003 first quarter. The operating margin before acquisition costs increased 3 percentage points to 24.7% in the first quarter of 2004, compared to the year-ago quarter where the operating margin was 21.7% before acquisition costs. Earnings per share increased 20% to EUR 0.24 per diluted share in the first quarter of 2004, up from EUR 0.20 per diluted share in the year-ago first quarter. Earnings per share before acquisition costs increased 19% to EUR 0.25 per diluted share in the 2004 first quarter, up from EUR 0.21 per diluted share in the 2003 first quarter. The strong increase in earnings per share, as reported and before acquisition costs, reflected the growth in revenue and the significant increase in the operating margin over the year-ago quarter. For the first quarter of 2004 net income totaled EUR 28.2 million, up 26% compared to EUR 22.3 million in the 2003 first quarter. Net income before acquisition costs totaled EUR 28.6 million in the 2004 first quarter, up 18% compared to EUR 24.2 million in the year-ago 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 560.5 million at March 31, 2004, up from EUR 439.7 million at December December: see month. 31, 2003. Net cash provided by operations was EUR 106.5 million for the first quarter of 2004. Strategy, Technology and Partnerships 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 stated, "During the first quarter we made excellent progress in realizing key business initiatives. We were very pleased to announce Boeing's decision to develop the 7E7 using our PLM Version 5 software solutions. This will be a broad 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. of all our PLM brands to deliver very significant savings in development time and manufacturing costs and will truly transform the development of aircraft. From a technology perspective, we introduced Version 5 Release 13 (V5R13), our newest release for the PLM market. V5R13 includes a number of advances. In particular, ENOVIA VPM VPM Vibrations Per Minute (engineering) VPM Vampire Princess Miyu (anime) VPM Video Port Manager VPM Virtual Product Management VPM Ventroposteromedial VPM Voice Processing Module Navigator See Netscape Navigator, Netscape and Norton Navigator. Navigator - Netscape Navigator provides unprecedented data management capabilities from within the familiar environment of CATIA. We continued to pursue our successful diversification strategy, and are excited about our decision to enter the automation market, a new market with significant 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. opportunities for Dassault Systemes, through our recently announced partnership with Schneider Electric Schneider Electric (Euronext: SCHN) is a French global company. It was founded in 1836 by two brothers, Joseph and Adolphe Schneider, who took over a troubled foundry at Le Creusot. ." The Boeing Company announced that it has selected Dassault Systemes' latest generation of PLM solutions, including CATIA, ENOVIA, SMARTEAM and DELMIA DELMIA Digital Enterprise Lean Manufacturing Interactive Application , as its company-wide product development platform to develop the 7E7 and future projects. Working together, Boeing and DS are creating a virtual 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. development workspace known as the 7E7 Global Collaboration Working together on a project. See collaborative software. Environment (GCE GCE 1. (formerly in Britain) General Certificate of Education 2. Informal a pass in a GCE examination GCE n abbr (BRIT) (= General Certificate of Education) → ), where Boeing and all its partners will design, build and test every aspect of the 7E7 airplane airplane, aeroplane, or aircraft, heavier-than-air vehicle, mechanically driven and fitted with fixed wings that support it in flight through the dynamic action of the air. and its manufacturing processes digitally before production begins using the full suite of DS PLM software solutions. DS introduced Version 5 Release 13 (V5R13), "PLM Workspace for Collective Innovation" in March of 2004. CATIA, DELMIA, ENOVIA AND SMARTEAM V5R13 product portfolios bring business value to manufacturers by enabling them and their supply chain to deploy competitive new PLM best practices that reduce development cycles significantly. A major innovation in the V5R13 release is the new ENOVIA VPM Navigator product that enables manufacturers to take maximum advantage of relational See relational algebra, relational calculus, relational database, relational query and relational operator. design, integrating ENOVIA's virtual product definition into CATIA's easy-to-use design environment. DS and Schneider Electric, the world's Power & Control specialist, entered into a business partnership pursuant to which Schneider Electric will sell DELMIA solutions and develop Consulting and Services for the Automation and Production Engineering markets through a newly formed company called Dextus, fully owned by Schneider Electric. The DELMIA solutions that will be distributed pursuant to this partnership will include a new product line called DELMIA Automation, dedicated to define, control and monitor automated au·to·mate v. au·to·mat·ed, au·to·mat·ing, au·to·mates v.tr. 1. To convert to automatic operation: automate a factory. 2. systems. DS and Rand Rand See Witwatersrand. rand 1 n. See Table at currency. [Afrikaans, after(Witwaters)rand. A Technology Corporation, operating as RAND Worldwide, announced plans to create 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. Subject to the closing of the transaction, Rand Americas will become a subsidiary of Dassault Systemes and will be 60% owned by DS and 40% owned by RAND Worldwide. Charles Edelstenne, Chairman of Dassault Systemes, concluded, "All major product lines and geographies contributed to our revenue growth in the first quarter, which drove strong increases in our operating margin and earnings per share." Business Outlook "We are increasing our revenue growth objective for 2004 to about 8% growth in constant currencies, reflecting higher activity in the first quarter and our new North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. joint venture with Rand in PLM," Thibault de Tersant stated. "Due to the strengthening of the U.S. dollar during the first quarter, we think it is appropriate to assume a U.S. dollar to Euro exchange rate of $1.25 per EUR 1.00 for purposes of calculating reported revenue, operating margin and EPS objectives, leading to a reported revenue objective of about EUR 785 million and an EPS objective before acquisition costs of about EUR 1.30 - EUR 1.32 for 2004. Our objective for 2004 is to deliver a stable to slightly increasing operating margin before acquisition costs in comparison to the 29.0% achieved in 2003. Our revenue objective for the second quarter is about EUR 180 - EUR 185 million, based upon a U.S. dollar to Euro exchange rate of $1.25 per EUR 1.00."
Major Press Release Highlights
----------------------------------------------------------------------
April 16, 2004. Schneider Electric and Dassault Systemes partner to
bring next-generation services and Digital
Solutions to Automation and Production Engineering
Markets.
----------------------------------------------------------------------
April 15, 2004. Dassault Systemes and RAND Worldwide announce Joint
Venture for PLM sales in North America.
----------------------------------------------------------------------
April 7, 2004. Beneteau Group selects PLM Shipbuilding Solutions
from IBM and Dassault Systemes.
----------------------------------------------------------------------
March 30, 2004. Aesculap breaks into New Healthcare Markets with
PLM Solutions from IBM and Dassault Systemes.
----------------------------------------------------------------------
March 29, 2004. Jackel speeds OEM product design for global
customers such as E. Arden, Bath & Body Works with
SolidWorks software.
----------------------------------------------------------------------
March 22, 2004. Zyvex uses SolidWorks software to design nano scale
devices for building and testing MEMS, carbon
nanotubes.
----------------------------------------------------------------------
March 18, 2004. Meyer Werft, builder of world's most innovative and
comfortable cruise ships, signs major three-year
contract for PLM Solutions from IBM and Dassault
Systemes.
----------------------------------------------------------------------
March 9, 2004. Announcement of V5R13 PLM portfolio.
----------------------------------------------------------------------
February 19, 2004. SUNTEN (China's leading Electrical Network
Equipment Supplier) chooses PLM Solutions from IBM
and Dassault Systemes.
----------------------------------------------------------------------
February 12, 2004. Boeing signs long-term contract with IBM and
Dassault Systemes to standardize PLM Platform on
Version 5.
----------------------------------------------------------------------
February 12, 2004. Boeing and Dassault Systemes - Partners in
Innovation for 7E7 Dreamliner.
----------------------------------------------------------------------
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. Date and Cash Dividend Recommendation The Annual Shareholders' Meeting has been scheduled for June June: see month. 2, 2004. The Board of Directors of Dassault Systemes has recommended an increase in the annual cash dividend for the fiscal year ended December 31, 2003 to EUR 0.34 per share (excluding avoir fiscal). The declaration and payment of any cash dividend is subject to approval by shareholders at the Annual Shareholders' Meeting. Endnotes: 1. All comparative figures are given on a year-over-year basis unless specified spec·i·fy tr.v. spec·i·fied, spec·i·fy·ing, spec·i·fies 1. To state explicitly or in detail: specified the amount needed. 2. To include in a specification. 3. otherwise. 2. All financial information is unaudited and reported 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. generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting (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 non-U adj. Chiefly British Not characteristic of the upper class, especially in language usage. [non- + U2. .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 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 the Company's progress and outlook because it provides a better gauge gauge In manufacturing and engineering, a device used to determine whether a dimension is larger or smaller than a reference standard. A snap gauge, for example, is formed like the letter C, with outer “go” and inner “not go” jaws, and is used to 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. , April 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 second 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, 2002, which was filed with the SEC on May 15, 2003, 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(TM), 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
1st QUARTER
-----------
in millions of Euro, except per share data, headcount and exchange
rates.
1Q04 1Q03 Variation
---------------------------------
Process-Centric excluding PDM 123.7 121.6 2%
PDM 19.9 17.3 15%
Design-Centric 32.6 30.5 7%
Revenue 176.2 169.4 4%
Americas 49.5 51.0 (3%)
Europe 81.9 78.4 4%
Asia 44.8 40.0 12%
Operating Income (1) 43.5 36.8 18%
Operating Margin (1) 24.7% 21.7%
Net Income (1) 28.6 24.2 18%
EPS (1) 0.25 0.21 19%
Closing Headcount 4,185 3,994 5%
Average Rate USD per Euros 1.25 1.07 17%
Average Rate JPY per Euros 134 128 5%
(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
March 31, 2004 March 31, 2003
-------------- --------------
Software 148.9 145.1
Service and Other 27.3 24.3
--------- ---------
Total Revenue EUR 176.2 EUR 169.4
Software 4.8 5.8
Service and Other 24.7 21.9
--------- ---------
Total Cost of Revenue EUR 29.5 EUR 27.7
Gross Profit EUR 146.7 EUR 141.7
Research and Development 54.1 53.6
Marketing and Sales 37.8 39.6
General Administration 11.3 11.7
Acquisition Costs 0.6 2.1
--------- ---------
Total Research, Selling, Administration
and Acquisition expenses EUR 103.8 EUR 107.0
========= =========
Operating Income (1) EUR 42.9 EUR 34.7
Financial revenue and Other 1.4 2.0
Income before income taxes 44.3 36.7
Income tax expense (16.1) (14.4)
--------- ---------
Net Income (1) EUR 28.2 EUR 22.3
========= =========
Basic net income per share EUR 0.25 EUR 0.20
========= =========
Diluted net income per share (1) EUR 0.24 EUR 0.20
========= =========
Basic weighted average shares
outstanding (in millions) 113.1 113.5
========= =========
Diluted weighted average shares
outstanding (in millions) 115.8 114.0
(1) Excluding acquisition costs, operating income and net income would
have been as follows:
Operating Income EUR 43.5 EUR 36.8
========= =========
Net Income EUR 28.6 EUR 24.2
========= =========
Diluted net income per share EUR 0.25 EUR 0.21
========= =========
Supplemental Disclosures Regarding Non-U.S. GAAP Financial Information: Excluding Acquisition Costs The following table sets 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 ended March 31, 2004. In particular, the table presents 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 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 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
March 31, 2004 March 31, 2003 Variation
-------------- -------------- ---------
Software 148.9 145.1 2.6%
Service and Other 27.3 24.3 12.3%
---------- ----------
Total Revenue EUR 176.2 EUR 169.4 4.0%
Software 4.8 5.8 (17.2)%
Service and Other 24.7 21.9 12.8%
---------- -----------
Total Cost of Revenue EUR 29.5 EUR 27.7 6.5%
Gross Profit EUR 146.7 EUR 141.7 3.5%
Research and Development 54.1 53.6 0.9%
Marketing and Sales 37.8 39.6 (4.5)%
General Administration 11.3 11.7 (3.4)%
---------- -----------
Total Research, Selling,
Administration EUR 103.2 EUR 104.9 (1.6)%
========== =========== ========
Operating Income EUR 43.5 EUR 36.8 18.2%
Financial revenue and Other 1.4 2.0 (30.0)%
Income before income taxes 44.9 38.8 15.7%
Income tax expense (16.3) (14.6) N/M
Net Income EUR 28.6 EUR 24.2 18.2%
========== =========== ========
Diluted net income per share EUR 0.25 EUR 0.21 19.0%
========== =========== ========
Diluted weighted average
shares outstanding (in
millions) 115.8 114.0
DASSAULT SYSTEMES
CONSOLIDATED STATEMENT OF INCOME DATA
RECONCILIATIONS NON-U.S. GAAP / U.S. GAAP
(in millions of Euro, except per share data)
Three Months Ended
March 31, 2004
----------------------------------------
Excluding
Reported Acquisition Acquisition
Amount Costs Costs
----------------------------------------
Software 148.9 148.9
Service and Other 27.3 27.3
---------- ----------
Total Revenue EUR 176.2 EUR 176.2
Software 4.8 4.8
Service and Other 24.7 24.7
---------- ----------
Total Cost of Revenue EUR 29.5 EUR 29.5
Gross Profit EUR 146.7 EUR 146.7
Research and Development 54.1 54.1
Marketing and Sales 37.8 37.8
General Administration 11.3 11.3
Acquisition Costs 0.6 (0.6) -
---------- ==========
Total Research, Selling,
Administration EUR 103.8 EUR 103.2
========== ==========
Operating Income EUR 42.9 EUR 43.5
Financial revenue and Other 1.4 1.4
Income before income taxes 44.3 44.9
Income tax expense (16.1) (0.2) (16.3)
Net Income EUR 28.2 EUR 28.6
========== ==========
Diluted net income per
share EUR 0.24 EUR 0.25
========== ==========
Diluted weighted average
shares outstanding
(in millions) 115.8 115.8
March 31, 2003
----------------------------------------
Excluding
Reported Acquisition Acquisition
Amount Costs Costs
----------------------------------------
Software 145.1 145.1
Service and Other 24.3 24.3
---------- ----------
Total Revenue EUR 169.4 EUR 169.4
Software 5.8 5.8
Service and Other 21.9 21.9
---------- ----------
Total Cost of Revenue EUR 27.7 EUR 27.7
Gross Profit EUR 141.7 EUR 141.7
Research and Development 53.6 53.6
Marketing and Sales 39.6 39.6
General Administration 11.7 11.7
Acquisition Costs 2.1 (2.1) -
========== ==========
Total Research, Selling,
Administration EUR 107.0 EUR 104.9
========== ==========
Operating Income EUR 34.7 EUR 36.8
Financial revenue and Other 2.0 2.0
Income before income taxes 36.7 38.8
Income tax expense (14.4) (0.2) (14.6)
Net Income EUR 22.3 EUR 24.2
========== ==========
Diluted net income per
share EUR 0.20 EUR 0.21
========== ==========
Diluted weighted average
shares outstanding (in
millions) 114.0 114.0
DASSAULT SYSTEMES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions of Euro)
March 31, 2004 December 31, 2003
-------------- -----------------
ASSETS
Cash and short-term investments 560.5 439.7
Accounts receivable, net 147.5 227.6
Other assets 292.9 297.2
------------ -----------
Total assets EUR 1,000.9 EUR 964.5
LIABILITIES
AND SHAREHOLDERS' EQUITY
Total liabilities 299.2 306.8
Shareholders' equity 701.7 657.7
------------ -----------
Total liabilities and
shareholders' equity EUR 1,000.9 EUR 964.5
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