Quarterly Report • Jul 26, 2019
Quarterly Report
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Building Software – Empowering The Entire AEC Lifecycle
HALF-YEAR REPORT AS OF JUNE 30, 2019
Patrik Heider, Spokesman of the Executive Board and CFOO
Following the extraordinary strong first quarter of 2019, we recorded very dynamic development in the second quarter as well, and increased our revenue by more than 20%. The operating margin rose from 28.2% in the first quarter to a high 29.0% in the second quarter. At the same time, Nemetschek, the top player for software solutions in the global AEC market, continued to invest strategically in next-generation solutions and further internationalization in order to secure the high-level growth dynamics for the future.
The first half year met our expectations utterly and completely. We are recording ongoing fast growth and high demand on the part of our customers. We therefore remain the fastest-growing listed software company in Germany with global reach. In addition, in the first half year, we have been able to considerably and strategically develop our Manage segment further and expand it. We are, therefore, in an excellent position to achieve our targets for the year 2019 as a whole.
The increase was positively influenced by the initial application of the new IFRS 16 standard concerning the accounting of leases. Adjusted for this effect, the EBITDA margin in Q2 was 26.3%, and in the first half year 25.9%, thus remaining entirely within the scope of the company's expectations.
» The quarterly profit rose by 20.8% to EUR 21.9 million in Q2. As a result, the earnings per share amounted to EUR 0.19. From a half-year perspective, it was possible to increase the profit for the period by 20.3%, rising to EUR 41.4 million, which corresponds to earnings per share in the amount of EUR 0.36.
In segment reporting, the Solibri brand, which was allocated to the Build segment until the end of 2018, was reclassified to the Design segment in 2019. The values from the previous year were adjusted accordingly and are thus comparable.
Following the strong first half of the year, we confirm the previously set corporate targets for the year 2019 as a whole. We expect Group revenue in the range of EUR 540 million to EUR 550 million, which corresponds to growth of 17% to 19% compared to the previous year.
The EBITDA margin is expected to be between 27% and 29%. The expectation considers the effects of the first-time adoption of the new leasing standard IFRS 16* with repeatedly future-oriented investment and the as yet below average EBITDA margin in the Manage segment.
Moreover, the net income for the year after taxes and the earnings per share for 2019, as announced on July 2, 2019, are positively affected, in addition to growth in ordinary operations, as a result of the sale of the non-strategic shares in the associated company DocuWare. From today's perspective, the sale will lead to an one-off rise in the EPS of about 40% compared to the previous year's figure and will take place in Q3.
Yours sincerely
Patrik Heider
* For the first time, as of January 1, 2019, the new financial reporting standard IFRS 16 is to be applied, according to which leases of any kind (operating or finance leasing) are to be accounted for and recognized. As a result of this reform, the Nemetschek Group anticipates a positive effect on the EBITDA of approximately EUR 14 million to EUR 15 million. The Nemetschek Group will provide detailed information on the effects on EBITDA arising from IFRS 16 in the quarters.
Global share markets started the year 2019 favorably and, following a rise at the beginning of the year, have tended to plateau. The growing intensity of the trade conflict between the USA and China and its impacts on global trade slowed the upwards trend from the first quarter. The most recent economic data has been less than ideal.
After a strong start of the year, German share markets were thus rather volatile and plateaued. All in all, it was possible to close the first half of the year with a clear plus: The DAX and the technology companies consolidated in the TecDAX achieved gains of some 17% since the beginning of the year. The MDAX was even able to grow by just under 19%.
On January 2, 2019, the Nemetschek share started the new year at a price of EUR 31.83. Right at the start of the year, the share dropped to an all-time low of EUR 30.41 (January 3, 2019) as a result of the market environment, which remained volatile. Thereafter, the Nemetschek share was able to develop considerably more strongly than the German indexes. The favorable price development was driven by positive company news, including the acquisition of the brand Axxerion in the Manage segment on January 11, the preliminary annual figures for 2018 on February 6, the announcement of an increased dividend payout on March 21 and the complete annual figures on March 29, at which time the Nemetschek Group also published its ambitious forecast for 2019. The share also continued to rise in the second quarter, driven in particular by expressly high figures in the first quarter, which were published on April 30. This was followed by a consolidation phase. The Nemetschek share got new impetus with the stock split on June 28. With the split completed, the Nemetschek share reached its all-time high of EUR 52.95 in the first half of the year. The share was also able to continue its ascent after the reporting date.
All in all, the share rose by some 66% in the first half of the year. The market capitalization of Nemetschek SE increased accordingly to around EUR 6.1 billion as of June 28, 2019.
On June 28, 2019, Nemetschek SE implemented the stock split resolved on by the annual general meeting on May 28, 2019. Every shareholder received two shares for every Nemetschek share held at no further charge by means of a corresponding depot credit. The stock split was technically carried out by means of a capital increase of the company's funds of EUR 77,000,000 from EUR 38,500,000 to EUR 115,500,000. Given that the overall value remained the same, the estimated price level of the Nemetschek share for the shareholders was accordingly divided by three. As a result of the split, the nominal capital of Nemetschek SE has tripled from currently 38,500,000 to 115,500,000 no-par value bearer shares.
As of June 28, 2019, the nominal capital of Nemetschek SE increased to EUR 115,500,000 and was divided into 115,500,000 no-par value bearer shares.
The free float remained unchanged at 46.9 percent as of June 28, 2019.
* Direct shareholdings as of June 30, 2019.
On May 28, 2019, the executive board and supervisory board of the Nemetschek Group welcomed some 140 shareholders to the regular annual general meeting in Munich. Shareholders were informed about the past financial year 2018 and about the prospects for the current financial year 2019. Then resolutions from the agenda were presented for approval. The company's shareholders approved all agenda items with a large majority.
The agenda items also included the distribution of dividends. For the 2018 financial year, the supervisory board and executive board proposed a dividend in the amount of EUR 0.27 per share (after the share split), an increase of about 8% compared to the previous year (EUR 0.25 per share). The considerable dividend increase was in keeping with the very positive business development in 2018. The total dividends to be distributed amounted to EUR 31.19 million (previous year: EUR 28.88 million).
Moreover, the stock split, which had already been carried out as of June 28, was approved at the annual general meeting.
| NEMETSCHEK GROUP | ||||||
|---|---|---|---|---|---|---|
| Millions of € | 2nd quarter 2019 | 2nd quarter 2018 | Change | 6 month 2019 | 6 month 2018 | Change |
| Operative figures | ||||||
| Revenues | 137.8 | 113.8 | 21.1% | 267.7 | 216.0 | 23.9% |
| - thereof software licenses | 57.3 | 56.2 | 2.0% | 112.3 | 103.4 | 8.6% |
| - thereof recurring revenues | 73.2 | 53.6 | 36.6% | 140.9 | 104.1 | 35.3% |
| - subscription (as part of the recurring revenues) | 11.7 | 4.7 | 147.6% | 21.4 | 9.0 | 136.7% |
| EBITDA | 40.0 | 31.1 | 28.6% | 76.6 | 59.0 | 30.0% |
| as % of revenue | 29.0% | 27.3% | 28.6% | 27.3% | ||
| EBITDA (IFRS 16 adjusted) | 36.2 | 31.1 | 16.6% | 69.3 | 59.0 | 17.5% |
| as % of revenue | 26.3% | 27.3% | 25.9% | 27.3% | ||
| EBITA | 33.8 | 29.0 | 16.6% | 64.7 | 55.0 | 17.7% |
| as % of revenue | 24.5% | 25.5% | 24.2% | 25.4% | ||
| EBIT | 29.6 | 25.6 | 15.7% | 56.4 | 48.2 | 17.1% |
| as % of revenue | 21.5% | 22.5% | 21.1% | 22.3% | ||
| Net income (group shares) | 21.9 | 18.1 | 20.8% | 41.4 | 34.5 | 20.3% |
| per share in €* | 0.19 | 0.16 | 0.36 | 0.30 | ||
| Net income (group shares) before purchase price allocation |
24.9 | 20.8 | 19.6% | 47.8 | 39.9 | 19.8% |
| per share in €* | 0.22 | 0.18 | 0.41 | 0.35 | ||
| Millions of € Cash flow figures |
6 month 2019 | 6 month 2018 | Change | |||
| Cash flow from operating activities | 69.3 | 43.4 | 59.8% | |||
| Cash flow from investing activities Cash flow from financing activities |
–111.8 41.1 |
–8.2 –54.0 |
||||
| Free cash flow | –42.5 | 35.1 | ||||
| Free cash flow before M&A investments | 55.1 | 38.2 | ||||
| Millions of € | June 30, 2019 |
December 31, 2018 |
Change | |||
| Balance sheet figures | ||||||
| Cash and cash equivalents | 119.8 | 120.7 | –0.8% | |||
| Net liquidity /net debt | –89.7 | –9.9 | ||||
| Balance sheet total | 777.2 | 580.6 | 33.9% | |||
| Equity ratio in % | 33.6% | 43.0% | ||||
| Headcount as of balance sheet date** | 2,776 | 2,305 | 20.4% | |||
| Millions of € | June 30, 2019 |
June 30, 2018 |
||||
| Share figures | ||||||
| Closing price (Xetra) in €* | 52.95 | 34.37 | ||||
| Market Capitalization | 6,115.73 | 3,969.74 | ||||
| Dividend per share in €* | 0.27 | 0.25 |
* For better comparability, the figures have been presented after the share split.
** Presentation of previous year as of June 30, 2018.
The Nemetschek Group increased its revenues in the first six months by 23.9% to EUR 267.7 million (previous year: EUR 216.0 million). Purely organic growth amounted to 17.9%. Currency-adjusted on the basis of constant currency translation rates, this would result in 20.5%, revenue growth, or 14.5% purely organic growth.
EBITDA increased to EUR 76.6 million (previous year: EUR 59.0 million). The rise in the EBITDA margin of 27.3% in the previous year to 28.6% was as a result of the initial application of IFRS 16 "Leases". Adjusted for the effect as a result of the application of IFRS 16, this would result in an EBITDA margin of 25.9%. The development of the adjusted EBITDA, which is underproportional compared to revenue, is the result of acquisition costs, costs for BAU 2019 architecture fair, held every two years, and investments in strategic projects.
During the first six months, the Nemetschek Group's revenue from software licenses increased by 8.6% rising to EUR 112.3 million (previous year: EUR 103.4 million). Currency-adjusted, it was possible to achieve an increase of 5.0%. During the same period, recurring revenue at 35.3% rose much more strongly than software licenses to EUR 140.9 million (previous year: EUR 104.1 million). Currency-adjusted recurring revenues increased by 31.8%. The share of revenue from software licenses amounts to 42.0% (previous year: 47.9%); it was possible to increase the share of recurring revenue from 48.2% to 52.6%.
In terms of region, the growth impulses came from within Germany as well as from international markets. Revenues within Germany increased by 8.3% to EUR 67.5 million (previous year: EUR 62.3 million). In markets abroad, the Nemetschek Group achieved revenues amounting to EUR 200.2 million, a plus of 30.2% compared to the previous year. The share of revenues from abroad amounted to 74.8% (previous year: 71.2%).
As a result of the new executive board structure of the Group and the corresponding, stronger focus on segments, the reporting structure was adapted as per IFRS 8. The Solibri brand was reclassified from the Build segment to the Design segment. The comparative figures were adjusted in the Interim Management Report. Please refer to the segment tables in the notes to the Interim Financial Statements for the originally reported values from the previous year.
In the Design segment, the Nemetschek Group generated revenue growth of 12.0%, rising to EUR 150.0 million (previous year: EUR 133.9 million). EBITDA increased by 26.7% to EUR 41.6 million (previous year: EUR 32.8 million). This is equivalent to an operating margin of 27.7%, following 24.5% in the previous year. In the Build segment, revenues rose due to the continuously strong growth of Bluebeam Software, Inc. with a plus of 29.4% to EUR 84.6 million, a considerable increase compared to the previous year's level (previous year: EUR 65.4 million). The EBITDA margin also rose considerably, growing to 33.2% (previous year: 30.3%). The revenues in the Manage segment rose by EUR 13.4 million to EUR 17.5 million mainly as a result of the acquisition of Spacewell. The EBITDA margin decreased to 6.9% (previous year: 19.1%) due to acquisition costs. Revenues in the Media & Entertainment segment amounted to EUR 15.7 million at the end of the first half of the year, exceeding the level of the previous year (EUR 12.7 million). The EBITDA margin, at 37.2%, decreased compared to the previous year (previous year: 44.1%).
Operating expenses rose by 25.2% from EUR 171.0 million to EUR 214.1 million. This includes material expenses, which grew to EUR 9.3 million (previous year: EUR 6.6 million). Personnel expenses increased by 25.0% from EUR 94.1 million to EUR 117.5 million. Mainly due to the initial application of IFRS 16, the amortization and depreciation on fixed assets increased by 87.0% from EUR 10.8 million to EUR 20.2 million. Other operating expenses rose by 12.6% from EUR 59.5 million to EUR 67.0 million.
The Group's tax rate in the first six months of 2019 amounted to 25.5% (previous year: 25.9%). The net income for the year (Group shares) of EUR 41.4 million thus exceeded the value of the previous year of EUR 34.5 million by 20.3%. Consequently, the earnings per share amounted to EUR 0.36 (previous year, adjusted as a result of the stock split: EUR 0.30 per share). Adjusted for the amortization from the purchase price allocation after tax effects, net income for the year increased by 19.8% to EUR 47.8 million (previous year: EUR 39.9 million), and thus the earnings per share reached EUR 0.41 (previous year, adjusted as a result of the stock split: EUR 0.35 per share).
On May 28, 2019, the annual general meeting resolved to pay out a dividend of EUR 0.81 per share (in consideration of the stock split: EUR 0.27 per share).
The high cash flow from operating activities was mainly used for dividend payments, loan payments and investments in fixed assets. Company acquisitions were financed by taking out loans.
The Nemetschek Group generated an operating cash flow of EUR 69.3 million in the first six months of 2019 (previous year: EUR 43.4 million). Due to the initial application of IFRS 16, the operating cash flow increased by EUR 5,9 million compared to the financial reporting framework applied in the previous year. The cash flow from investment activities amounted to EUR –111.8 million (previous year: EUR –8.2 million) and includes EUR 73.4 million paid for the acquisition of the Axxerion Group as well as EUR 24.2 million for the acquisition of Redshift Rendering Technologies, Inc. The cash flow from financing activities of EUR 41.1 million (previous year: EUR –54.0 million) primarily includes dividends paid out in the amount of EUR 31.2 million, bank loans taken out in the amount of EUR 100.0 million, the repayment of bank loans in the amount of EUR 21.1 million and leasing liabilities in the amount of EUR 5,1 million.
At the end of the quarter, the Nemetschek Group held cash and cash equivalents of EUR 119.8 million (December 31, 2018: EUR 120.7 million).
Compared to December 31, 2018, the balance sheet total increased considerably from EUR 580.6 million to EUR 777.2 million. The cause of this rise was in particular the application of IFRS 16, which, as of June 30, 2019, affected fixed assets in the amount of EUR 65.3 million and leasing liabilities in the amount of EUR 67.8 million. Further, the acquisitions of the Axxerion Group and Redshift Rendering Technologies, Inc., and the financing of these acquisitions, contributed to the increase in the balance sheet total.
Deferred revenues increased by EUR 30.9 million to EUR 126.3 million in line with software service contracts invoiced. Mainly due to acquisitions and the initial application of IFRS 16, non-current liabilities increased by EUR 125.0 million to EUR 233.6 million. Equity amounted to EUR 260.9 million (December 31, 2018: EUR 249.6 million), thus the equity ratio was 33.6% after 43.0% as of December 31, 2018.
There were no significant events after the end of the interim reporting period.
As of the reporting date, June 30, 2019, the Nemetschek Group employed a staff of 2,776 (June 30, 2018: 2,305). The increase is mainly attributable to recruitment in several Group companies as well as to the acquisition of Axxerion Group B.V. and Redshift Rendering Technologies, Inc.
There are no significant changes compared to the information provided in the consolidated financial statements as of December 31, 2018.
Please see the opportunities and risks described in the Group management report for the year ended December 31, 2018 for details on significant opportunities and risks for the prospective development of the Nemetschek Group. In the interim period there were no material changes.
Following the strong first half of the year, the Nemetschek Group confirms the previously set corporate targets for the year 2019 as a whole. It anticipates Group revenue in the range of EUR 540 million to EUR 550 million, which corresponds to growth of 17% to 19% compared to the previous year.
The EBITDA margin is expected to be between 27% and 29%. The expectation considers the effects of the first-time adoption of the new leasing standard IFRS 16 with repeatedly future-oriented investment and the as yet below average EBITDA margin in the Manage segment.
for the period from January 1 to June 30, 2019 and 2018
| Thousands of € | 2nd quarter 2019 | 2nd quarter 2018 | 6 month 2019 | 6 month 2018 |
|---|---|---|---|---|
| Revenues | 137,803 | 113,819 | 267,732 | 216,042 |
| Other operating income | 1,188 | 2,192 | 2,754 | 3,143 |
| Operating income | 138,991 | 116,011 | 270,486 | 219,185 |
| Cost of materials /cost of purchased services | –4,941 | –3,376 | –9,262 | –6,630 |
| Personnel expenses | –60,268 | –48,922 | –117,532 | –94,059 |
| Depreciation of property, plant and equipment and amortization of intangible assets | –10,385 | –5,511 | –20,228 | –10,816 |
| thereof depreciation of right-of-use-assets | –3,588 | 0 | –7,014 | 0 |
| thereof amortization of intangible assets due to purchase price allocation | –4,213 | –3,433 | –8,254 | –6,803 |
| Other operating expenses | –33,815 | –32,642 | –67,047 | –59,518 |
| Operating expenses | –109,409 | –90,451 | –214,069 | –171,023 |
| Operating results (EBIT) | 29,582 | 25,560 | 56,417 | 48,162 |
| Interest income | 209 | 88 | 364 | 158 |
| Interest expenses | –721 | –163 | –1,424 | –352 |
| thereof right-of-use-assets | –368 | 0 | –725 | 0 |
| Share of results of associated companies | 334 | 0 | 334 | 0 |
| Other financial expenses /income | –3 | 332 | –3 | 332 |
| Earnings before taxes (EBT) | 29,401 | 25,817 | 55,688 | 48,300 |
| Income taxes | –7,517 | –6,990 | –14,194 | –12,488 |
| Net income for the year | 21,884 | 18,827 | 41,494 | 35,812 |
| Other comprehensive income: | ||||
| Difference from currency translation | –2,511 | 6,217 | 1,239 | 2,415 |
| Subtotal of items of other comprehensive income that will be reclassified to income in future periods: |
–2,511 | 6,217 | 1,239 | 2,415 |
| Remeasurement gains /losses from pensions and related obligations | –197 | –24 | –294 | 71 |
| Tax effect | 94 | 7 | 121 | –20 |
| Subtotal of items of other comprehensive income that will not be reclassified to income in future periods: |
–103 | –17 | –173 | 51 |
| Subtotal other comprehensive income | –2,614 | 6,200 | 1,066 | 2,466 |
| Total comprehensive income for the year | 19,270 | 25,027 | 42,560 | 38,278 |
| Net profit or loss for the period attributable to: | ||||
| Equity holders of the parent | 21,858 | 18,092 | 41,447 | 34,460 |
| Non-controlling interests | 26 | 735 | 47 | 1,352 |
| Net income for the year | 21,884 | 18,827 | 41,494 | 35,812 |
| Total comprehensive income for the year attributable to: | ||||
| Equity holders of the parent | 19,244 | 24,256 | 42,512 | 36,887 |
| Non-controlling interests | 26 | 771 | 48 | 1,391 |
| Total comprehensive income for the year | 19,270 | 25,027 | 42,560 | 38,278 |
| Earnings per share (undiluted) in euros | 0.19 | 0.16* | 0.36 | 0.30* |
| Earnings per share (diluted) in euros | 0.19 | 0.16* | 0.36 | 0.30* |
| Average number of shares outstanding (undiluted) | 115,500,000 | 115,500,000 | 115,500,000 | 115,500,000 |
| Average number of shares outstanding (diluted) | 115,500,000 | 115,500,000 | 115,500,000 | 115,500,000 |
* For better comparability, earnings per share has been presented after the stock split.
as of June 30, 2019 and December 31, 2018
| ASSETS | Thousands of € June 30, 2019 |
December 31, 2018 |
|---|---|---|
| Current Assets | ||
| Cash and cash equivalents | 119,778 | 120,747 |
| Trade receivables, net | 65,303 | 55,758 |
| Inventories | 1,595 | 1,156 |
| Tax refunded claims for income taxes | 5,059 | 4,239 |
| Other current financial assets | 1,618 | 4,209 |
| Other current assets | 20,655 | 16,140 |
| Non-current assets held for sale | 3,418 | 0 |
| Current assets, total | 217,426 | 202,249 |
| Non-current assets, total | ||
| Property, plant and equipment | 24,653 | 17,574 |
| Right-of-use assets | 65,289 | 0 |
| Intangible assets | 136,588 | 102,085 |
| Goodwill | 322,760 | 244,349 |
| Investments in associates | 955 | 3,964 |
| Deferred tax assets | 2,908 | 3,157 |
| Non-current financial assets | 5,360 | 5,315 |
| Other non-current assets | 1,262 | 1,865 |
| Non-current assets, total | 559,775 | 378,309 |
| Total assets | 777,201 | 580,558 |
|---|---|---|
| EQUITY AND LIABILITIES | Thousands of € | June 30, 2019 | December 31, 2018 |
|---|---|---|---|
| Current liabilities | |||
| Short-term borrowings and current portion of long-term loans | 80,488 | 56,348 | |
| Trade payables | 9,155 | 12,878 | |
| Provisions and accrued liabilities | 33,880 | 40,647 | |
| Deferred revenue | 126,180 | 95,113 | |
| Income tax liabilities | 7,200 | 5,441 | |
| Other current financial obligations | 2,144 | 1,698 | |
| Current lease liability | 11,344 | 0 | |
| Other current liabilities | 12,322 | 10,180 | |
| Current liabilities, total | 282,713 | 222,305 | |
| Non-current liabilities | |||
| Long-term borrowings without current portion | 129,030 | 74,280 | |
| Deferred tax liabilities | 26,317 | 17,198 | |
| Pensions and related obligations | 2,011 | 1,677 | |
| Non-current deferred revenue | 106 | 262 | |
| Non-current financial obligations | 8,117 | 4,115 | |
| Non-current lease liability | 56,463 | 0 | |
| Other non-current liabilities | 11,565 | 11,124 | |
| Non-current liabilities, total | 233,609 | 108,656 | |
| Equity | |||
| Subscribed capital | 115,500 | 38,500 | |
| Capital reserve | 12,485 | 12,485 | |
| Retained earnings | 145,173 | 212,084 | |
| Other comprehensive income | –12,328 | –13,566 | |
| Equity (Group shares) | 260,830 | 249,503 | |
| Non-controlling interests | 49 | 94 | |
| Equity, total | 260,879 | 249,597 | |
| Total equity and liabilities | 777,201 | 580,558 |
for the period from January 1 to June 30, 2019 and 2018
| Thousands of € 6 month 2019 |
6 month 2018 | |
|---|---|---|
| Profit (before tax) | 55,688 | 48,300 |
| Depreciation and amortization of fixed assets | 20,228 | 10,816 |
| Change in pension provision | 40 | 36 |
| Other non-cash transactions | –197 | –198 |
| Share of results of associated companies | –334 | 0 |
| Result from disposal of fixed assets | 1,467 | 38 |
| Cash flow for the period | 76,892 | 58,992 |
| Interest income | –364 | –158 |
| Interest expenses | 1,424 | 352 |
| Change in other provisions | –8,738 | –2,723 |
| Change in trade receivables | –6,733 | –12,225 |
| Change in other assets | –235 | –6,368 |
| Change in trade payables | –4,089 | –873 |
| Change in other liabilities | 24,032 | 21,988 |
| Interest received | 363 | 127 |
| Income taxes received | 1,078 | 631 |
| Income taxes paid | –14,349 | –16,379 |
| Cash flow from operating activities | 69,282 | 43,364 |
| Capital expenditure | –12,698 | –5,193 |
| Changes in liabilities from acquisition | –1,500 | 0 |
| Cash received from disposal of fixed assets | 35 | 4 |
| Cash paid for acquisition of subsidiaries, net of cash acquired | –97,614 | –3,058 |
| Cash flow from investing activities | –111,777 | –8,247 |
| Dividend payments | –31,185 | –28,875 |
| Dividend payments to non-controlling interests | –93 | –1,711 |
| Interest paid | –1,359 | –377 |
| Repayment of borrowings | –21,110 | –23,000 |
| Principal elements of lease payments | –5,139 | 0 |
| Changes in bank liabilities due to company acquisitions | 100,000 | 0 |
| Cash flow from financing activities | 41,114 | –53,963 |
| Changes in cash and cash equivalents | –1,381 | –18,846 |
| Effect of exchange rate differences on cash and cash equivalents | 412 | 143 |
| Cash and cash equivalents at the beginning of the period | 120,747 | 103,957 |
| Cash and cash equivalents at the end of the period | 119,778 | 85,254 |
for the period from January 1 to June 30, 2019 and 2018
| Equity attributable to the parent company's shareholders | |||||||
|---|---|---|---|---|---|---|---|
| Thousands of € | Subscribed capital | Capital reserve | Retained earnings | Currency con version |
Total | Non-controlling interests |
Total equity |
| As of January 1, 2018 | 38,500 | 12,485 | 193,179 | –18,691 | 225,473 | 2,472 | 227,945 |
| Difference from currency translation |
- | - | - | 2,393 | 2,393 | 23 | 2,416 |
| Remeasurement gains /loss es from pensions and related obligations |
- | - | 36 | - | 36 | 16 | 52 |
| Net income for the year | - | - | 34,460 | - | 34,460 | 1,352 | 35,812 |
| Total comprehensive income for the year |
0 | 0 | 34,496 | 2,393 | 36,889 | 1,391 | 38,280 |
| Transition effects of new Inter national Financial Reporting Standards (IFRS) |
- | - | 538 | - | 538 | 0 | 538 |
| Dividend payments to non-controlling interests |
- | - | - | - | 0 | 0 | 0 |
| Dividend payment | –28,875 | - | –28,875 | –1,711 | –30,586 | ||
| As of June 30, 2018 | 38,500 | 12,485 | 199,338 | –16,298 | 234,025 | 2,152 | 236,177 |
| As of January 1, 2019 | 38,500 | 12,485 | 212,084 | –13,566 | 249,503 | 94 | 249,597 |
| Difference from currency translation |
- | - | - | 1,238 | 1,238 | 1 | 1,239 |
| Remeasurement gains /loss es from pensions and related |
|||||||
| obligations | - | - | –173 | - | –173 | 0 | –173 |
| Net income for the year | - | - | 41,447 | - | 41,447 | 47 | 41,494 |
| Total comprehensive income for the year |
0 | 0 | 41,274 | 1,238 | 42,512 | 48 | 42,560 |
| Capital increase from the company's funds |
77,000 | - | –77,000 | - | 0 | 0 | 0 |
| Dividend payments to non-controlling interests |
- | - | - | - | 0 | –93 | –93 |
| Dividend payment | - | - | –31,185 | - | –31,185 | 0 | –31,185 |
| As of June 30, 2019 | 115,500 | 12,485 | 145,173 | –12,328 | 260,830 | 49 | 260,879 |
The condensed consolidated interim financial statements of the Nemetschek Group have been prepared in accordance with the International Financial Reporting Standards (IFRS), as required to be applied in the European Union, and the interpretations of the International Financial Reporting Interpretations Committee (IFRIC) and of the Standing Interpretations Committee (SIC). These interim financial statements have been prepared in accordance with the requirements of IAS 34.
The interim financial statements as of June 30, 2019 have not been audited and have not undergone an audit. Significant changes to the consolidated statement of financial position, the consolidated statement of comprehensive income and the consolidated cash flow statement are detailed in the report on the earnings, financial and asset situation.
The accounting and valuation policies applied in the condensed consolidated interim financial statements are generally based on the same accounting and valuation policies used as a basis for the consolidated financial statements for the 2018 financial year. One exception is IFRS 16 "Leases", which has been applied in the Group since January 1, 2019.
Modified retrospective application of the provisions of IFRS 16 is used in the Group, i.e. the comparative figures for the periods of the previous year were not adjusted.
The lease liabilities arising from leasing arrangements recorded as of January 1, 2019 which were classified as operating leases as per IAS 17 were recognized at the present value of the lease payments remaining, discounted using the incremental borrowing rate applicable at this time. The weighted average of the incremental borrowing rate as of January 1, 2019 was 2.13%.
In the following, the operating lease obligations as of December 31, 2018 are transferred to the lease obligations as of January 1, 2019:
| Millions of € | Balance Sheet as of January 1, 2019 |
|---|---|
| Operating lease obligations as of December 31, 2018 | 78.4 |
| Relief option for short-term leases | –0.5 |
| Relief option for leases of low-value assets | –0.1 |
| FX-Effects | 0.2 |
| Other | –2.9 |
| Gross lease liabilities as of January 1, 2019 | 75.1 |
| Discounting | –6.8 |
| Lease liabilities at January 1, 2019 | 68.3 |
In the Group, as of December 31, 2018, there are no finance leases as per IAS 17.
Right-of-use assets were recognized at the amount of the lease liability, adjusted for lease payments made or accrued in advance. The right-of-use assets relate to following asset classes:
| Millions of € | June 30, 2019 | December 31, 2018 |
|---|---|---|
| Right-of-use assets - Property | 61.3 | 63.9 |
| Right-of-use assets - Office Equipment | 0.3 | 0.4 |
| Right-of-use assets - Vehicles | 3.7 | 3.5 |
Within the scope on the first-time application of IFRS 16, the Group exercised the following exemptions:
The effect on diluted and undiluted earnings per share is encumbered by EUR 0.003 as of June 30, 2019.
Under the purchase agreement of January 11, 2019, Spacewell (formerly: FASEAS/MCS Solutions Group) acquired 100% of the shares of Axxerion Group B.V., MR Heteren, Netherlands. For this acquisition of shares, there were payments amounting to EUR 76.8 million in the 2019 financial year. The transfer of benefits and encumbrances was completed as of the end of January 19, 2019. Within the scope of a preliminary allocation of the purchase price, the amount of EUR 33.1 million was allocated to intangible assets (technology, customer base, brand name, non-compete agreement). In addition, the amount of EUR 53.1 million was recorded as goodwill and EUR 3.4 million as cash and cash equivalents. Since joining the Group, the company has generated revenues of EUR 5.5 million. Axxerion Group B.V. is one of the leading providers of cloud-based software solutions for facility management and property management. The company develops products for the optimization of operations in facility management, systems management and maintenance management as well as property management and contract management.
With the purchase contract of April 5, 2019, Maxon Computer, Inc., Newbury Park, USA, acquired 100% of the shares of Redshift Rendering Technologies, Inc., Newport Beach, USA at a purchase price of EUR 27.3 million. Further, subsequent purchase price payments of up to EUR 7.6 million were agreed to. The subsequent purchase price payments are mainly dependent on revenue targets and earnings targets as well as technical milestones. As part of the preliminary purchase price allocation, the amount of EUR 9.1 million was allocated to intangible assets (technology, customer base, brand name). The allocation of goodwill is not yet finalized. Cash and cash equivalents acquired amounted to EUR 3.1 million. Since joining the Group, the company has generated revenues of EUR 1.1 million. Redshift offers an extremely powerful and flexible GPU-based rendering solution that functions with extreme speed, economy and reliability for the creation of visual effects, animations and animated graphics.
Nemetschek intends to sell the shares in the associated company DocuWare GmbH. To this end, on June 28, 2019, Nemetschek signed a contract with a company belonging to the Ricoh Group concerning the sale of the shareholding amounting to 22.41%. The proceeds from the sale after taxes are expected to amount to EUR 33 million. The conclusion of the transaction with Ricoh still requires the approval of the antitrust authorities. The conclusion is expected to take place in the course of the third quarter of 2019. In compliance with IFRS 5, the carrying amount of the interest in DocuWare GmbH was reclassified in the financial statements from investments in associates to non-current assets held for sale.
| Thousands of € | June 30, 2019 | June 30, 2018 |
|---|---|---|
| Software and licenses | 112,331 | 103,441 |
| Recurring revenues (software service contracts and rental models) |
140,881 | 104,144 |
| Services (consulting and training) | 14,158 | 8,399 |
| Hardware | 362 | 58 |
| 267,732 | 216,042 | |
| REVENUES BY REGION | ||
| Thousands of € | June 30, 2019 | June 30, 2018 |
| Germany | 67,547 | 62,253 |
| Non-Germany | 200,185 | 153,789 |
| Total | 267,732 | 216,042 |
for the period from January 1 to June 30, 2019 and 2018
| 2019 | Thousands of € | Total | Elimination | Design | Build | Manage | Media & Entertainment |
|---|---|---|---|---|---|---|---|
| Revenue, external | 267,732 | – | 149,978 | 84,570 | 17,518 | 15,666 | |
| Intersegment revenue | – | –1,566 | 2 | 713 | 27 | 824 | |
| Total revenue | 267,732 | –1,566 | 149,980 | 85,283 | 17,545 | 16,490 | |
| EBITDA | 76,645 | – | 41,573 | 28,044 | 1,201 | 5,827 | |
| Depreciation/amortization | –20,228 | –8,934 | –8,047 | –2,675 | –572 | ||
| Segment operating result (EBIT) | 56,417 | – | 32,639 | 19,997 | –1,474 | 5,255 |
The following table shows the adjusted values after segment reclassification of the Solibri brand:
| 2018 | Thousands of € | Total | Elimination | Design | Build | Manage | Media & Entertainment |
|---|---|---|---|---|---|---|---|
| Revenue, external | 216,042 | – | 133,868 | 65,352 | 4,140 | 12,682 | |
| Intersegment revenue | – | –1,353 | 1 | 592 | 0 | 760 | |
| Total revenue | 216,042 | –1,353 | 133,869 | 65,944 | 4,140 | 13,442 | |
| EBITDA | 58,978 | – | 32,814 | 19,781 | 792 | 5,591 | |
| Depreciation/amortization | –10,816 | – | –5,124 | –5,439 | –33 | –220 | |
| Segment operating result (EBIT) | 48,162 | – | 27,690 | 14,342 | 759 | 5,371 |
The following table shows the segment reporting prior to segment reclassification of the Solibri brand (version reported in Q2/2018):
| 2018 | Thousands of € | Total | Elimination | Design | Build | Manage | Media & Entertainment |
|---|---|---|---|---|---|---|---|
| Revenue, external | 216,042 | – | 130,242 | 68,979 | 4,140 | 12,682 | |
| Intersegment revenue | – | –1,866 | 4 | 1,101 | 0 | 760 | |
| Total revenue | 216,042 | –1,866 | 130,246 | 70,080 | 4,140 | 13,442 | |
| EBITDA | 58,978 | – | 32,185 | 20,410 | 792 | 5,591 | |
| Depreciation/amortization | –10,816 | – | –4,557 | –6,006 | –33 | –220 | |
| Segment operating result (EBIT) | 48,162 | – | 27,628 | 14,404 | 759 | 5,371 |
"We hereby confirm that to the best of our knowledge, the interim consolidated financial statements give a true and fair view of the net assets, financial position and results of operations of the Group and the interim Group management report gives a true and fair view of the business performance, including the results of operations and
Munich, July 2019
Patrik Heider Viktor Várkonyi Jon Elliott
the situation of the Group, and describes the main opportunities and risks and anticipated development of the Group in the remaining financial year, in accordance with the applicable framework for interim financial reporting."
Nemetschek SE, Munich Investor Relations, Konrad-Zuse-Platz 1, 81829 Munich
Contact: Stefanie Zimmermann,
VP Investor Relations and Corporate Communication
Tel.: +49 89 540459-250, Fax: +49 89 540459-444,
E-Mail: [email protected]
NEMETSCHEK SE Konrad-Zuse-Platz 1 81829 Munich Tel.: +49 89 540459-0 Fax: +49 89 540459-414 [email protected] www.nemetschek.com
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