Nemetschek Group: Stable revenue development with high operating margin in Q2 2020 in market environment of continued uncertainty
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Nemetschek Group: Stable revenue development with high operating margin in Q2 2020 in market environment of continued uncertainty

 
Nemetschek  - Jul 31, 2020 05:47 UTC

Nemetschek EN
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Munich, July 31, 2020 – The Nemetschek Group (ISIN DE 0006452907), one of the world’s leading software providers for the construction industry, closed the second quarter of 2020 with slight increases in revenue and earnings despite the global corona crisis. Overall, business development exceeded the company’s own expectations.

After the corona crisis left its mark in the second quarter, especially in Europe, it is not yet possible to foresee the effects of the pandemic in the USA, where the crisis has spread much more strongly than in other parts of the world and at a later point in time. Nemetschek anticipates hurdles in this regard in the US market in the second half of the year.

The Nemetschek Group responded to the altered situation at an early stage and also maintained close customer contact during the corona crisis by means of virtual sales and support as well as online tutorials. In addition, executives worldwide were involved in intensifying cost management in the Group at an early stage.

Major indicators of the Group’s success in the second quarter / first half of 2020

Overall, the performance of the segments in the first half year was slightly above the levels expected, especially in view of the fact that the corona crisis spread to the US market with a time lag. In March, the Design segment was already feeling the effects of the Covid-19 pandemic, which led to reduced customer demand and a decline in revenues. The Build and Manage segments were able to achieve low growth rates. The Media & Entertainment segment was considerably strengthened by the acquisition of Red Giant. The integration of the company, consolidated since January 2020, in the Maxon brand continues to proceed according to plan.

“As a result of our broad solution portfolio, our high levels of diversification with regard to target industries and regions and the growing proportion of recurring revenue, we have weathered the corona crisis better than anticipated. The increase in service contracts and subscriptions in particular show the robustness of the Nemetschek business model, even and especially in today’s uncertain market environment,” concludes Dr. Axel Kaufmann, Spokesman of the Executive Board and CFOO of the Nemetschek Group. “At the same time, as a result of the fast deployment of countermeasures in relation to costs, we have been able to keep our profitability at a high level. However, we expect that the crisis will also have an impact on our business development in the second half of the year, especially in the USA. Thus, caution and vigilance remain our top priority. We continue to see great potential in our markets in the medium and long term. Nemetschek will keep on successfully driving the digital transformation in the construction industry forward,” continued Kaufmann.

The Nemetschek Group is always working on future-oriented solutions to further improve the workflow in the construction industry. Thus, for instance, in the Design segment with Integrated Design, a cross-brand workflow solution was presented for the first time which is revolutionizing collaboration between architects, structural engineers and civil engineers. With this integrated approach, it is possible for architects and engineers to work together on one model across disciplines for the first time, making unsynchronized work in silos and duplications a thing of the past.

Group outlook for 2020 confirmed

As a result of the very solid first half year, growth trends in the relevant markets that remain intact in the long-term, ongoing increases in the proportion of plannable revenues and broad regional and market-related diversification of risk, the executive board confirms the revenue targets for the full year 2020, despite a still uncertain environment, and is optimistic to comfortably reach the targeted profitability. It also assumes that a certain reluctance on the part of customers will continue in the third quarter before business development should gradually improve again.

For the year 2020 as a whole, the executive board is thus unchanged in its anticipation of development which is at least stable or a slight increase in Group revenue with an EBITDA margin of more than 26% of Group revenue.

 

Overview of quarterly key figures (Q2)


In EUR million Q2 2020 Q2 2019 Δ in %

Δ in %
FX-adj
Revenues 141.6 137.8 +2.7% +2.0%
- thereof software licenses 46.7 57.3 -18.5% -19.2%
- thereof recurring revenues 88.9 73.2 +21.5% +20.7%
- Subscription (part of recurring revenues) 20.5 11.7 +75.5% +74.9%
EBITDA 40.7 40.0 +1.9% +1.7%
Margin 28.8% 29.0%    
EBITA 34.6 33.8 +2.3%  
Margin 24.4% 24.5%    
EBIT 28.4 29.6 -4.0%  
Margin 20.1% 21.5%    
Net income (Group shares) 21.1 21.9 -3.4%  
Earnings per share in EUR 0.18 0.19 -3.4%  
Net income (Group shares) before amortization of purchase price allocation (PPA) 26.1 24.9 +4.8%  
Earnings per share before PPA in EUR 0.23 0.22 +4.8%  
Overview of quarterly key figures per segment (Q2)
In EUR million Q2 2020 Q2 2019 Δ in % (organic)

Δ in %
FX-adj. (organic)
Design        
Revenue 72.6 76.7 -5.3% -5.5%
EBITDA 23.1 21.8 +6.0% +6.6%
EBITDA margin 31.8% 28.4%    
Build        
Revenue 48.2 44.8 +7.6% +6.0%
EBITDA 18.3 16.2 +12.6% +11.9%
EBITDA margin 38.0% 36.3%    
Manage        
Revenue 9.6 9.3 +3.1% +3.2%
EBITDA 1.7 1.6 +4.5% +2.6%
EBITDA margin 17.7% 17.4%    
Media & Entertainment        
Revenue 12.9 8.9 +44.5% (+1.7%) +42.8% (+0.9%)
EBITDA 3.8 3.1 +23.2% +22.8%
EBITDA margin 29.8% 35.0%    

Overview of half-year key figures

In EUR million Half-year 2020 Half-year 2019 Δ in %

Δ in %
FX-adj
Revenues 288.2 267.7 +7.6% +6.6%
- thereof software licenses 100.1 112.3 -10.8% -12.0%
- thereof recurring revenues 175.0 140.9 +24.2% +23.0%
- Subscription (part of recurring revenues) 40.1 21.4 +87.7% +86.4%
EBITDA 82.6 76.6 +7.7% +5.5%
Margin 28.7% 28.6%    
EBITA 70.2 64.7 +8.5%  
Margin 24.3% 24.2%    
EBIT 57.6 56.4 +2.1%  
Margin 20.0% 21.1%    
Net income (Group shares) 42.5 41.4 +2.6%  
Earnings per share in EUR 0.37 0.36 +2.6%  
Net income (Group shares) before amortization of purchase price allocation (PPA) 52.4 47.8 +9.7%  
Earnings per share before PPA in EUR 0.45 0.41 +9.7%  

 

Overview of half-year key figures per segment

In EUR million Half-year 2020 Half-year 2019 Δ in % (organic)

Δ in %
FX-adj. (organic)
Design        
Revenue 149.8 152.2 -1.6% -2.1%
EBITDA 46.2 44.5 +4.0% +1.6%
EBITDA margin 30.9% 29.2%    
Build        
Revenue 96.8 85.3 +13.5% +11.5%
EBITDA 37.0 30.3 +22.0% +20.0%
EBITDA margin 38.2% 35.5%    
Manage        
Revenue 19.6 17.5 +11.5% +11.6%
EBITDA 2.7 1.6 +70.7% +70.7%
EBITDA margin 13.8% 9.0%    
Media & Entertainment        
Revenue 25.6 16.5 55.1% (+8.7%) +52.7% (+7.4%)
EBITDA 6.9 6.2 +10.9% +10.9%
EBITDA margin 26.9% 37.6%    

About the Nemetschek Group

The Nemetschek Group is a pioneer for the digital transformation in the AEC industry. With its software solutions, it covers the complete life cycle of building and infrastructure projects and guides its customers into the future of digitalization. As one of the world's leading corporate groups in this field, the Nemetschek Group increases quality in the construction process and improves the digital workflow of all those involved in the construction process. This revolves around the use of open standards (Open BIM). The innovative solutions of the 16 brands in the four customer-oriented divisions are used by approximately six million users worldwide. Founded by Prof. Georg Nemetschek in 1963, the Nemetschek Group today employs more than 3,000 experts.

Publicly listed since 1999 and quoted on the MDAX and TecDAX, the company achieved revenue in the amount of EUR 556.9 million and an EBITDA of EUR 165.7 million in 2019.

 

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About Nemetschek EN

The Nemetschek Group is a pioneer for the digital transformation in the AEC industry. With its software solutions, it covers the complete life cycle of building and infrastructure projects and guides its customers into the future of digitalization.

Contacts

Stefanie Zimmermann

 


szimmermann@nemetschek.com
+49 89 540459 250