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Nemetschek SE — Investor Presentation 2018
Sep 11, 2018
301_ip_2018-09-11_71310705-171d-46da-b31d-e167fb71dcea.pdf
Investor Presentation
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Nemetschek Group
Company Presentation September 2018
Nemetschek's key achievements: #2 biggest listed software company in Germany
We generate high shareholder returns1
4-year TSR*
- | Nemetschek: ~500% | Peer group2 : ~110%
- | TecDAX: ~120%
We outperform our peers2
4-year revenue CAGR: | Nemetschek: >20% | Peer group2 : <10%
We keep our promises
FY 2017:
| Strong revenue growth by +17.3% to € 395.6m | EBITDA guidance with € 108.0m exceeded
We have become a global player
Impressive track record:
| 5-year CAGR of 45% in the US – the world's largest / most competitive AEC market
We deliver high profitability while we invest significantly in growth
Focus on growth:
| Double-digit revenue growth with sustainable EBITDA margin corridor of 25%-27%
1 TSR: Total shareholder return: Share price performance + dividend | 2 Peer group: International software companies
Nemetschek's industry achievements: #2 biggest global player in AEC
| We deliver revolutionary and best-in-class solutions in AEC covering the complete value chain
| We set industry standards for design, structural engineering, construction and building operations workflows
| We are the most customer-oriented AEC company
| We respect the customer's needs
| We gained >300,000 new users in 2017 (total of 4.0 million users worldwide)
| We stand for a flexible distribution approach, offering subscription as an additional choice
| We are the strongest growing AEC company with a 5-year CAGR of 17.7% | We outperformed the AEC market growth (~11% p.a.) 5 years in a row | We are closing the gap to the market leader to become #1 in AEC
Company Presentation
The Nemetschek Group: A unique approach similar to German Mittelstand
| Highly specialized small or midsized companies
| Long-term focus
| Innovative: holding 5x as many patents per employee as major cooperations
| Customer focused: 37% of all employees have regular customer contact (only 7% in major co-operations)
| Internationally successful: Almost 50% of all small world market leaders are German
| Going to market through 16 strong brands (5-90m €)
| Every brand is a world leader in its discipline
| Innovative: Many brands are pioneers in Building Information Modeling
| Customer focused: All brands are developing their solutions in close cooperation with the customers
| Internationally successful: #1 AEC software provider in Europe, one of the largest worldwide
Our DNA: Strong brands under one umbrella
| Architecture | ||||
|---|---|---|---|---|
| DESIGN | BUILD | MANAGE | Media & Entertainment |
|
- | Nemetschek covers the complete value chain in the AEC & Media industry
- | Entrepreneurial brands: Industry leaders with a unique DNA, expertise and customer orientation
- | Attractive set-up for potential targets
01 Financial Results H1 2018
Charles Perkinns Centre, Sydney, Australia
Architects: fjmt, fjmtstudio.com | Image: John Gollings | Realized with GRAPHISOFT
Top key figures Q2 2018: Accelerated growth with high profitability
Company Presentation
Top key figures H1 2018: On the way to achieving the guidance for 2018
1 Constant currency
Company Presentation
Growth driver recurring revenues: Smooth transition towards subscription
Revenue split H1 2018
Consulting & Hardware
1 Constant currency 2 Previous year
Company Presentation
Software licenses yoy Recurring revenues yoy +23.0% cc1 +17.4% ▌ Strong growth to €8.9m (previous year: €6.5m) ▌ Strategic change of business model: smooth transition towards subscriptions Subscription yoy +48.3% cc1 +37.6% +13.1% cc1 +6.7% ▌ Above average growth to €104.1m (previous year: €88.7m) ▌ Accelerated growth in Q2 ▌ Half year figures of 103.4 mEUR in line with expectations H1 2018 Software licenses yoy Recurring revenues yoy +23.6% cc1 +19.3% Subscription yoy +49.4% cc1 +41.2% +21.4% cc1 +16.1% Q2 2018 H1 2018 comments
Internationalization is key: Growth accelerated in Q2 in all regions
Americas +29% cc1 +15% Europe +11% cc1 +9% Asia +19% cc1 +10% UK +31% cc1 +28% Germany +9% H1 2018 Americas +32% cc1 +21% Europe +15% cc1 +13% Asia +27% cc1 +19% UK +41% cc1 +33% Germany +11% Q2 2018
1 Constant currency 2 Previous year
Company Presentation
Segment overview: Build segment is key growth driver
Revenues in €m
Company Presentation
Net liquidity situation allows for strategic M&A
1 Operating cash flow/EBITDA 2Previous year = End of 2017
Company Presentation
02 AEC Industry in Transition
Scott Sports SA, Gibisiez, Swiss
General planner / Architect: Itten+Brechbühl AG, Bern
The world population will grow by 2.5 billion in the next 30 years
In 1810, 2% of the population lived in cities, in 2010 it was 50%
By 2050, most of the world will be living in megacities
We spend more than 20 hours a day in buildings
Buildings consume 40% of the world's energy, and growing
90% of urban growth will happen in developing countries
SEPTEMBER 18 Company Presentation 14
In the same period, manufacturing has increased productivity 760%
SEPTEMBER 18 15
Company Presentation
The AEC Market grows to € 7.4 billion in 2021
End-user-expenditures (EUE) in m€
Source: Cambashi BIM Design Obseratory and internal research
03 Outlook 2018 / Mid -Term Goal 2020
Scott Sports SA, Gibisiez, Swiss
General planner / Architect: Itten+Brechbühl AG, Bern
Mid-term goal 2020: Secure future double-digit growth while maintaining a high EBITDA margin
1 The revenue outlook is based on planned exchange rate of 1.18 EUR/USD
Strong operating profit and additional extraordinary investments of €10 million in 2018
1 Internationalization 2 3 Operational excellence
Key drivers & fields of investments
Next generation
products & solutions
Taking advantage of market leaderships
| Strong US brands support US market entry for European brands and vice versa
Focus on markets
with biggest potential
| USA followed by Europe and Asia
Architecture & structural engineering
Next-generation
products & solutions
| Targeting large customers by combining superior discipline specific products into total BIMworkflow solutions
Collaboration
- | Development of a group-wide UK BIM compliant Common Data Environment (CDE)
- | Huge market potential: Collaboration market size of >€1 bn with a midteens growth rate
Increase efficiency
| Implementation of a groupwide harmonized core application infrastructure to leverage process efficiency
Excellent positioning in dynamically growing market
1 Source: Cambashi
Company Presentation
Financial Calender
| October 30, 2018 | Publication of 9 -month report |
|---|---|
| November 13, 2018 | Capital markets day, Frankfurt |
| November 15, 2018 | Morgan Stanley TMT Conference, Barcelona |
| November 27, 2018 | Eigenkapitalforum (equity forum), Frankfurt |
| December 6, 2018 | Berenberg European Conference 2018, |
Pennyhill
04
Company Presentation 21 SEPTEMBER 18
P+L statement Q2 2018 comparison
| €m | Q2 2018 | Q2 2017 | % YoY | H1 2018 | H1 2017 | %YoY |
|---|---|---|---|---|---|---|
| Revenues | 113.8 | 97.7 | +16.5% | 216.0 | 194.0 | +11.4% |
| Own work capitalized/other operating income |
2.2 | 1.1 | +90.9% | 3.1 | 2.1 | +47.1% |
| Operating income | 116.0 | 98.8 | +17.4% | 219.2 | 196.1 | +11.8% |
| Cost of materials/purchased services | -3.4 | -3.5 | -4.7% | -6.6 | -6.3 | +5.6% |
| Personnel expenses | -48.9 | -42.1 | +16.3% | -94.1 | -85.5 | +10.0% |
| Other operating expenses | -32.6 | -27.9 | +17.0% | -59.5 | -52.7 | +13.0% |
| Operating expenses | -84.9 | -73.5 | +15.6% | -160.2 | -144.4 | +10.9% |
| EBITDA | 31.1 | 25.3 | +22.6% | 59.0 | 51.7 | +14.1% |
| Margin | 27.3% | 25.9% | 27.3% | 26.6% | ||
| Depreciation of PPA and amortization | -5.5 | -5.4 | +1.8% | -10.8 | -10.9 | -0.7% |
| t/o PPA | -3.4 | -3.4 | +0.5% | -6.8 | -6.9 | -1.8% |
| EBITA (normalized EBIT) |
29.0 | 23.3 | +24.2% | 55.0 | 47.7 | +15.2% |
| EBIT | 25.6 | 19.9 | +28.3% | 48.2 | 40.8 | +18.0% |
| Financial result | 0.3 | -0.2 | 0.1 | -0.4 | ||
| EBT | 25.8 | 19.7 | +31.1% | 48.3 | 40.4 | +19.7% |
| Income taxes | -7.0 | -5.6 | +24.6% | -12.5 | -11.5 | +8.8% |
| Non-controlling interests | -0.7 | -0.6 | -1.4 | -1.2 | ||
| Net income (group shares) | 18.1 | 13.5 | +34.2% | 34.5 | 27.7 | +24.5% |
| EPS in EUR | 0.47 | 0.35 | +34.2% | 0.90 | 0.72 | +24.5% |
Balance sheet – Assets
| €m | June 30, 2018 | December 31, 2017 |
|---|---|---|
| Assets | ||
| Cash and cash equivalents | 85.3 | 104.0 |
| Trade receivables, net | 53.3 | 41.0 |
| Inventories | 0.6 | 0.6 |
| Other current assets | 21.0 | 13.5 |
| Current assets, total | 160.1 | 159.1 |
| Property, plant and equipment | 15.9 | 14.9 |
| Intangible assets | 81.3 | 86.9 |
| Goodwill | 198.6 | 192.7 |
| Other non-current assets | 7.5 | 7.3 |
| Non-current assets, total | 303.3 | 301.7 |
| Total assets | 463.4 | 460.8 |
Balance sheet – Equity and liabilities
| €m | June 30, 2018 | December 31, 2017 |
|---|---|---|
| Equity and liabilities | ||
| Short-term borrowings and current portion of long-term loans | 26.0 | 36.0 |
| Trade payables & accrued liabilities | 40.3 | 43.7 |
| Deferred revenue | 91.3 | 68.1 |
| Other current assets | 18.0 | 18.0 |
| Current liabilities, total | 175.6 | 165.7 |
| Long-term borrowings without current portion | 30.9 | 43.9 |
| Deferred tax liabilities | 12.9 | 13.5 |
| Other non-current liabilities | 7.8 | 9.6 |
| Non-current liabilities, total | 51.6 | 67.1 |
| Subscribed capital and capital reserve | 51.0 | 51.0 |
| Retained earnings | 199.3 | 193.2 |
| Other comprehensive income | -16.3 | -18.7 |
| Non-controlling interests | 2.2 | 2.5 |
| Equity, total | 236.2 | 227.9 |
| Total equity and liabilities | 463.4 | 460.8 |
Company Presentation
Cash flow statement
| €m | June 30, 2018 | June 30, 2017 | % YoY |
|---|---|---|---|
| Cash and cash equivalents at the beginning of the period | 104.0 | 112.5 | -7.6% |
| Cash flow from operating activities | 43.4 | 44.5 | -2.5% |
| Cash flow from investing activities | -8.2 | -28.7 | -71.3% |
| t/o CapEX | -5.2 | -4.0 | +28.3% |
| t/o Cash paid for business combinations | -3.1 | -24.5 | |
| Cash flow from financing activities | -54.0 | -39.9 | |
| t/o Repayments of borrowings | -23.0 | -13.0 | |
| FX-effects | 0.1 | -4.9 | |
| Cash and cash equivalents at the end of the period | 85.3 | 83.4 | +2.2% |
| Free cash flow1 | 35.1 | 15.7 | |
| Free cash flow1 (w/o acquisition effects) |
38.2 | 40.2 | -5.1% |
1 Operating cash flow – Investing cash flow
Outstanding success in the US: Worldwide largest single AEC market
Company Presentation
Contact
NEMETSCHEK SE Investor Relations Konrad-Zuse-Platz 1 81829 Munich Germany [email protected] www.nemetschek.com
Disclaimer
This presentation contains forward-looking statements based on the beliefs of Nemetschek SE management. Such statements reflects current views of Nemetschek SE with respect to future events and results and are subject to risks and uncertainties. Actual results may vary materially from those projected here, due to factors including changes in general economic and business conditions, changes in currency exchange, the introduction of competing products, lack of market acceptance of new products, services or technologies and changes in business strategy. Nemetschek SE does not intend or assume any obligation to update these forward-looking statements.