Nemetschek SE — Call Transcript 2019

Mar 29, 2019

University Library Freiburg, Germany

Architects: Degelo Architects, Basel, Switzerland | Image: Andrea Secci | Realized with GRAPHISOFT

Nemetschek Group Earnings Call

Financial Results 2018 / Outlook 2019

29 March 2019 | Patrik Heider, Spokesman & CFOO

Nemetschek's Key Figures: 5 Years - 5 Achievements

Earnings Call FY 2018 / Outlook 2019

¹ TSR: Total shareholder return: Share price performance + dividend | 2013–2018 | ² Peer group: International software companies

5-Years Development: Positioned to Provide Strong Growth

¹ 2013–2018

Earnings Call FY 2018 / Outlook 2019

Key Business Highlights: New Record Levels and Successes in FY 2018

Focus on customer

Customers >5m

Customer retention >95%

01 Financial Results FY 2018

Top Key Figures FY 2018: Another Record Year with Strong Growth

Growth Driver Recurring Revenues: Strongest Growth in Subscription

Internationalization Is Key: US Is Strongest Growing Market

Revenue distribution FY 2018

Segment Overview: Build Segment Is Key Growth Driver

Revenues in m€

Healthy Cash Conversion Allows Further Investment in Organic Growth and Strategic M&A

¹ Operating cash flow/EBITDA | ² Previous year = End of 2017

Earnings Call FY 2018 / Outlook 2019

03 Strategic Priorities / Financial Outlook

Montforthaus, Feldkirch, Austria

Falcon Hospital, Guangzhou, China

Visualization: Slashcube, Switzerland | Realized with MAXON

HASCHER JEHLE Architektur, Germany | Images: David Matthiessen | realized with NEVARIS

New Executive Board & Leadership Structure: Strong Customer-Oriented Divisions

Numerous Stakeholders: Huge Information Loss at the Hand-Over Points

Full Cycle BIM

Information is collected during each phase of the building lifecycle. Stakeholders still act in silos. Owners are demanding that the overall process be optimized. At the handoff points, which is a huge loss in terms of efficiency and leads to additional cost.

Three Strategic Initiatives to drive the End-to-End BIM Workflow

and drive the whole information flow by leveraging building lifecycle project data in new ways

Earnings Call FY 2018 / Outlook 2019 29 MARCH 2019 14

construction solutions

Investment Focus: Our Strategic Investments of € 10 Million in 2018

3 Strategic initiatives to drive next-generation solutions

1. From Design to Build

| Targeting large customers by connecting the competences of brands | Disruptive workflow for design collaboration | Growing positioning in infrastructure

2. Transformative construction solutions

| Connected solutions to digitalize workflows and leverage construction project data in new ways | Empower file users with mobile solutions

3. Smart Building Platform

| Creating an integrated portfolio for the total building management lifecycle | Closing the loop towards design & build | Multi-source intelligent data hub for improving building, people and service performance

Enter adjacent markets

• | Leverage regional market leadership
• and competencies across brands
• | Investments in local market presence, resources, and end-to-end localized customer experience

Focus on markets with biggest potential

| USA followed by Europe and Asia

Increase efficiency

| Implementation of a groupwide harmonized core application infrastructure to leverage process efficiency

Outlook 2019: Strong Double-Digit Growth While Maintaining a High EBITDA Margin

Earnings Call FY 2018 / Outlook 2019

€m	Q4 2018	Q4 2017	% YoY	12M 2018	12M 2017	%YoY
Revenues	130.4	105.7	+23.3%	461.3	395.6	+16.6%
Own work capitalized/other operating income	1.1	1.4	-17.2%	5.5	4.8	+13.1%
Operating income	131.5	107.1	+22.8%	466.8	400.4	+16.6%
Cost of materials/purchased services	-4.1	-3.3	+25.3%	-14.3	-12.9	+10.6%
Personnel expenses	-55.3	-45.0	+22.7%	-200.6	-172.6	+16.2%
Other operating expenses	-39.1	-27.3	+43.4%	-130.7	-106.9	+22.2%
Operating expenses	-98.5	-75.6	+30.3%	-345.5	-292.4	+18.2%
EBITDA	33.0	31.5	+4.9%	121.3	108.0	+12.3%
Margin	25.3%	29.8%		26.3%	27.3%
Depreciation of PPA and amortization	-6.6	-5.4	+22.7%	-23.5	-21.6	+8.8%
t/o PPA	-4.1	-3.3	+25.0%	-14.7	-13.5	+9.0%
EBITA (normalized EBIT)	30.5	29.4	+3.9%	112.5	99.9	+12.6%
EBIT	26.4	26.1	+1.2%	97.8	86.4	+13.1%
Financial result	2.0	8.6		2.0	8.0
EBT	28.4	34.7	-18.1%	99.8	94.4	+5.7%
Income taxes	-4.7	-2.2	+109.2%	-23.2	-17.6	+32.3%
Non-controlling interests	0.1	-0.6		-0.1	-2.2
Net income (group shares)	23.8	31.8	-25.1%	76.5	74.7	+2.4%
EPS in EUR	0.62	0.83	-25.1%	1.99	1.94	+2.4%

€m	December 31, 2018	December 31, 2017
Assets
Cash and cash equivalents	120.7	104.0
Trade receivables, net	55.8	41.0
Inventories	1.2	0.6
Other current assets	24.6	13.5
Current assets, total	202.2	159.1
Property, plant and equipment	17.6	14.9
Intangible assets	102.1	86.9
Goodwill	244.3	192.7
Other non-current assets	14.3	7.3
Non-current assets, total	378.3	301.7
Total assets	580.6	460.8

€m	December, 2018	December 31, 2017
Equity and liabilities
Short-term borrowings and current portion of long-term loans	56.3	36.0
Trade payables & accrued liabilities	53.5	43.7
Deferred revenue	95.1	68.1
Other current assets	17.3	18.0
Current liabilities, total	222.3	165.7
Long-term borrowings without current portion	74.3	43.9
Deferred tax liabilities	17.2	13.5
Other non-current liabilities	17.2	9.6
Non-current liabilities, total	108.7	67.1
Subscribed capital and capital reserve	51.0	51.0
Retained earnings	212.1	193.2
Other comprehensive income	-13.6	-18.7
Non-controlling interests	0.1	2.5
Equity, total	249.6	227.9
Total equity and liabilities	580.6	460.8

	. GROUP
December 31, 2017	% YoY
112.5	$-7.6%$

€m	December 31, 2018	December 31, 2017	% YoY
Cash and cash equivalents at the beginning of the period	104.0	112.5	-7.6%
Cash flow from operating activities	99.7	97.4	+2.4%
Cash flow from investing activities	-74.4	-54.6	+36.3%
t/o CapEX	-11.3	-8.8	+28.5%
t/o Cash paid for business combinations	-63.1	-45.4
Cash flow from financing activities	-10.4	-44.8
t/o Dividend payments	-28.9	-25.0
t/o Repayments of borrowings	-38.0	-26.0
t/o Changes in bank liabilities due to company acquisitions	86.0	10.0
t/o Payments for acquisitions of non-controlling interests	-27.0	-0.2
FX-effects	1.8	-6.6
Cash and cash equivalents at the end of the period	120.7	104.0	+16.1%
Free cash flow1	25.4	42.8
Free cash flow1 (w/o acquisition effects)	88.5	88.2	+0.3%

¹ Operating cash flow – Investing cash flow

Safe Harbor Statement

Each of the presentations today will contain forward -looking statements about our strategies, products, future results, performance or achievements, financial, operational and otherwise, including statements about our strategic priorities, guidance and our mid -term goal, our M&A strategy, and our capital allocation initiatives. These statements reflect management's current expectations, estimates and assumptions based on the information currently available to us. These forward -looking statements are not guarantees of future performance and involve significant risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from results, performance or achievements expressed or implied by the forward -looking statements contained in these presentations.

Nemetschek undertakes no obligation to publicly update or revise any forward looking statements. All forward looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from expectations. Readers are cautioned not to place undue reliance on these forward looking statements, which speak only as of their dates.

29 MARCH 2019 Earnings Call FY 2018 / Outlook 2019 Ingenuity Center, Nottingham, Great Britain Architects: Bond Bryan Architects, Great Britain | Realized with GRAPHISOFT

Contact

NEMETSCHEK SE Investor Relations

Konrad -Zuse -Platz 1 81829 Munich Germany

investorrelations@nemetschek.com www.nemetschek.com