Nemetschek SE — Earnings Release 2020

Jul 31, 2020

Irina Viner-Usmanova Rhythmic Gymnastics Center, Moscow, Russia

Architects: Creative Production Union PRIDE | Realized with Graphisoft

Nemetschek Group

Earnings Call Q2 - / H1 -2020

July 31 2020 | Dr. Axel Kaufmann, Spokesman & CFOO

Bunjil Place, Narre Warren, Australia Architects: fjmt; Image: Trevor Mein | Realized with Graphisoft 01 Financial Results Q2- / H1-2020

Top Key Figures Q2-2020: Covid-19 impacts visible, ongoing in Q3

Key Business Highlights H1-2020: Solid First Half Year Despite Challenging Environment

Solid Financial Performance M&A Transactions, Divestitures

Q1-2020: Red Giant by Maxon Q1/Q2-2020: Integration of Red Giant and Redshift progressing as planned

Planning & Design Division:

Q2-2020: ADAPT by RISA. Strengthens structural engineering competence in the US

Globally Positioned: Strong Regional Diversification Balances Risks

H1-2020: US market still solid, but high uncertainty for Q3

5 JULY 2020 Earnings Call Q2- / H1-2020

Strong Growth in Recurring Revenues: Subscription Is Key Driver

Revenue distribution H1-2020

At a Glance: Income Statement and Important KPIs

Key Figures mEUR	Q2 2020	Q2 YoY	H1-2020	H1 YoY	in % of revenue
Revenues	141.6	+2.7%	288.2	+7.6%	100.0%
Cost of materials/cost of purchased services	-5.9	+20.3%	-11.0	+19.1%	3.8%
Personnel expenses	-64.0	+6.3%	-129.6	+10.2%	45.0%
Other operating income/expenses	-30.8	-5.5%	-65.0	+1.2%	22.6%
EBITDA	40.7	+1.9%	82.6	+7.7%	28.7%
EBITDA margin	28.8%	-20bps	28.7%	+10bps	-
D&A (incl. PPA)	-12.3	+18.8%	-25.0	+23.4%	8.7%
EBIT	28.4	-4.0%	57.6	+2.1%	20.0%
EBIT margin	20.1%	-140bps	20.0%	-110bps	-
Net income (Group shares)	21.1	-3.4%	42.5	+2.6%	14.8%
EPS	0.18	-3.4%	0.37	+2.6%	-
Operating cash flow	35.2	+1.2%	78.2	+12.9%	-
Free cash flow (ex M&A)	33.1	+19.7%	73.6	+30.0%	-
Equity ratio in %	43.3%	-	43.3%	-	-
Net debt (liquidity)	30.6	-	30.6	-	-

Sustainability: Gaining a Greater Importance for Our Customers

The FOOTPRINT of the Building Industry

Buildings and construction account for

| 36% of global final energy use and | 39% of energy-related CO2 emissions

During the construction phase

| 10% of materials are wasted | 30% of construction is rework

In 90% of all projects, time or cost overruns occur.

Sources: Global Status Report 2019, UN Environment and the International Energy Agency. Engineering-News Record 2018/2019

Resource Saving Potentials Along the Construction Lifecycle

Digital building before physical building reduces rework in the building process to a minimum.

Precise planning saves large amounts of concrete, steel, sand, e.g. 90.000m³ of concrete in the building of Gotthard Base Tunnel, Switzerland.

Digital structural analysis solutions optimize the use of materials.

With digital solutions, the technical building equipment can also be dimensioned exactly.

On the construction site, the use of digital solutions can save up to 90% of paper.

Integrated Workplace Management Systems (IWMS) allow control of heating, ventilation and lighting.

The actual need for office space is measured only the space that is needed is planned and built.

New Design Solutions from the Nemetschek Group

Integrated Design

Lead Brands: Graphisoft, SCIA, RISA Delivering better design and increasing the Competitive Edge

Federated Design

Lead Brands: SCIA, Allplan True Automation: From Structural To Analysis Model

"Now, architects and engineers can work in the same 3D model together — our beams are their beams; their walls are our walls. Working together in realtime makes everything so much clearer, faster, and more efficient".

Jake Timmons, Riverstone Structural Concepts, USA

"This solution has a great potential to save a lot of time and effort for my work as an engineer. I don´t have to spend time rebuilding models".

Hannah Freireich, Will Rudd Davidson Ltd, Ireland (Beta Tester)

Nemetschek Is Well Positioned!

Nemetschek SE

Attractive end	Unique market	Attractive business	Strong financial	Value accretive
markets	position	model	position	M&A
Huge growth potential Structural long-term growth drivers (low degree of digitalization) Growth supported by regulation	Best in class products Product offering along the complete AEC value chain Leader in Open BIM Close proximity to customers within our 4 divisions	Highly profitable Strong cash conversion (> 90%) High share of recurring revenues (approx. 60%) High returns (ROCE > 20%)	Very healthy balance sheet Net debt/EBITDA: 0.4x Equity ratio: 43% EUR 200m credit line secured Long-term anchor shareholder	Strong track record of bolt-on acquisitions (e.g. Bluebeam) Disciplined approach Substantial financial fire power Focus on long-term value generation

Operating mode via four strong divisions with leading global brands

Covid-19 Impact: Status Quo after H1-2020

Covid-19 impact so far:

• Slowdown in Europe in Q2
• High uncertainty in US
• Strong decline in new licenses as expected
• Solid growth in recurring revenues

First measures quickly implemented:

• Sales & support activities adapted to new environment
• Cost saving measures initiated
• Financial position further improved, i.e. additional credit line of EUR 200m

Our working assumptions

• Deceleration in Q2 not as severe as feared
• Postponements from Q2 and slowdown to last into Q3 (especially in the US)
• Timing of Covid-19 impact on our business:

By division:

Design M&E Manage Build By geography:

APAC Europe Americas

Continued weakness in new licence & solid growth in recurring revenues

Status quo after H1-2020 Our response to the challenges

• Our first priority is the safety of our employees and customers
• We ensure business continuity and support our customers and the society in this difficult situation
• We will continue to...:
  • monitor the situation closely and steer the business on sight
  • be flexible and quick to react to new developments (e.g. Spacewell workplace solutions)
  • stay opportunistic

Outlook 2020: Confirmed after the First Half Year

Income Statement

€m	H1 -2020	H1 -2019	%YoY
Revenues	288.2	267.7	+7.6%
Other operating income	4.8	2.8	+74.3%
Operating income	293.0	270.5	+8.3%
Cost of materials/purchased services	-11.0	-9.3	+19.1%
Personnel expenses	-129.6	-117.5	+10.2%
Other operating expenses	-69.8	-67.0	+4.2%
Operating expenses	-210.4	-193.8	+8.6%
EBITDA	82.6	76.6	+7.7%
Margin	28.7%	28.6%
Depreciation and amortization	-25.0	-20.2	+23.4%
t/o right -of -use assets	-7.9	-7.0	+12.2%
t/o PPA	-12.5	-8.3	+52.0%
EBITA (normalized EBIT)	70.2	64.7	+8.5%
EBIT	57.6	56.4	+2.1%
Financial result	-1.1	-0.7	+49.8%
t/o IFRS 16	-0.8	-0.7	+4.4%
EBT	56.5	55.7	+1.5%
Income taxes	-13.8	-14.2	-3.1%
Non -controlling interests	0.2	0.0
Net income (group shares)	42.5	41.4	+2.6%
EPS in EUR	0.37	0.36	+2.6%

Balance Sheet – Assets

€m	June 30, 2020	December 31, 2019
Assets
Cash and cash equivalents	130.2	209.1
Trade receivables, net	63.1	62.0
Inventories	0.9	1.0
Other current assets	29.4	23.3
Current assets, total	223.6	295.5
Property, plant and equipment	24.4	27.6
Right-of-use assets	60.6	66.2
Intangible assets	149.8	127.7
Goodwill	417.2	325.0
Other non-current assets	15.5	15.2
Non-current assets, total	667.5	561.7
Total assets	891.2	857.2

Balance Sheet – Equity and Liabilities

€m	June 30, 2020	December 31, 2019
Equity and liabilities
Short-term borrowings and current portion of long-term loans	66.9	58.6
Trade payables & accrued liabilities	47.9	56.4
Deferred revenue	142.6	118.5
Current lease liability	13.5	12.6
Other current liabilities	34.3	25.6
Current liabilities, total	305.3	271.6
Long-term borrowings without current portion	93.9	129.5
Deferred tax liabilities	27.9	23.3
Non-current lease liability	53.2	57.7
Other non-current liabilities	24.8	26.4
Non-current liabilities, total	199.8	236.9
Subscribed capital and capital reserve	128.0	128.0
Retained earnings	228.2	230.9
Other comprehensive income	-18.4	-10.4
Non-controlling interests	48.3	0.1
Equity, total	386.1	348.6
Total equity and liabilities	891.2	857.2

20 Earnings Call Q2- / H1-2020 JULY 2020

Cash Flow Statement

€m	H1-2020	H1-2019	% YoY
Cash and cash equivalents at the beginning of the period	209.1	120.7	+73.2%
Cash flow from operating activities	78.2	69.3	+12.9%
Cash flow from investing activities	-88.3	-110.3
t/o CapEX	-4.7	-12.7
t/o Cash paid for acquisition of subsidiaries, net of cash acquired	-83.7	-97.6
Cash flow from financing activities	-67.4	39.6
t/o Dividend payments	32.3	31.2
t/o Repayments of borrowings	-27.3	-21.1
t/o Changes in bank liabilities due to company acquisitions	0.0	100.0
t/o Principal elements of lease payments	-6.4	-5.1
FX-effects	-1.5	0.4
Cash and cash equivalents at the end of the period	130.2	119.8	+8.7%
Free cash flow1	-10.1	-41.0
Free cash flow1 (w/o acquisition effects)	73.6	56.6	+30.0%

¹ Operating cash flow – Investing cash flow

Contact

NEMETSCHEK SE Investor Relations

Konrad-Zuse-Platz 1 81829 Munich Germany

investorrelations@nemetschek.com www.nemetschek.com

Safe Harbor Statement

The presentation today does 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.