Bentley Systems, Incorporated (Nasdaq: BSY) (“Bentley Systems”
or the “Company”), the infrastructure engineering software company,
today announced operating results for its first quarter ended March
31, 2022.
First Quarter 2022 Financial Results
- Total revenues were $275.5 million, up 24.1% or 27.7% on a
constant currency basis, year-over-year;
- Subscriptions revenues were $241.2 million, up 28.2% or 32.0%
on a constant currency basis, year-over-year;
- Last twelve-month recurring revenues were $885.9 million, up
23.6% year-over-year;
- Last twelve-month recurring revenues dollar-based net retention
rate was 108%, compared to 107% for the same period last year;
- Last twelve-month account retention rate was 98%, consistent
with the same period last year;
- Annualized Recurring Revenue (“ARR”) was $962.6 million as of
March 31, 2022, representing a constant currency ARR growth rate of
27% from March 31, 2021;
- GAAP operating income was $56.6 million, compared to $55.6
million for the same period last year;
- GAAP net income was $56.4 million, compared to $57.0 million
for the same period last year. GAAP net income per diluted share
was $0.18, compared to $0.18 for the same period last year. GAAP
net income margin was 20.5%, compared to 25.7% for the same period
last year;
- Adjusted Net Income was $79.6 million, compared to $64.1
million for the same period last year. Adjusted Net Income per
diluted share was $0.24 compared to $0.20 for the same period last
year;
- Adjusted EBITDA was $97.6 million, compared to $83.0 million
for the same period last year. Adjusted EBITDA margin was 35.4%,
compared to 37.4% for the same period last year; and
- Cash flow from operations was $101.7 million, compared to
$132.8 million for the same period last year.
Definitions of the non-GAAP financial measures used in this
press release and reconciliations of such measures to the most
comparable GAAP financial measures are included below under the
heading “Use and Reconciliation of Non-GAAP Financial
Measures.”
CEO Greg Bentley said, “Against this quarter’s backdrop of
compounding global concerns, I am pleased that we are reporting
overall resilience, starting with strong operating results,
consistent with our established financial outlook for 2022. Our
22Q1 results absorbed consequences directly related to Russia,
including mandatory sanctions, our discretionary new business
suspension there, and especially reductions in Russian ARR to
reflect an estimation of recurrence probability. But we also
absorbed a comparable amount of ARR attrition within China that I
believe stems largely from indirectly related ‘counter-globalism.’
Net of these disruptions, we still achieved constant currency ARR
growth, from a year ago, of 12% in business performance, plus 15%
from platform acquisitions.”
Mr. Bentley continued, “To proactively enhance our business
resilience with respect to counter-globalism, BSY Investments
announced our first joint venture in China to ‘glocalize’ our
platform within software and cloud service offerings being
developed there to meet the Chinese government’s provenance
requirements for critical infrastructure applications. Also on the
investment front, our leadership in core structural and
geotechnical engineering disciplines was augmented by our
acquisition of ADINA to add advanced non-linear analyses across our
simulation portfolio, to help in assessing and improving
infrastructure asset resilience against increasingly prevalent
environmental extremes.”
“And with respect to potential macroeconomic downturns, I
consider that 22Q1’s impressive net momentum in our business
corresponds with generally having become more resilient, even since
going public in 2020. Notably, as we have extended our global
leadership position in infrastructure engineering software and
digital twins for mobility, our flourishing platform acquisitions
for environmental opportunities (Seequent) and grid opportunities
(Power Line Systems) have considerably reduced the significance of
our comparatively minor exposure, within the commercial and
industrial infrastructure sectors, to cyclically vulnerable CAPEX
spending,” Mr. Bentley concluded.
First Quarter 2022 Financial Developments
On January 31, 2022, we completed the acquisition of Power Line
Systems, a leader in software for the design of overhead electric
power transmission lines and their structures, for $696.0 million
in cash, net of cash acquired. We used available cash and
borrowings under our bank credit facility to fund the
transaction.
Operating Results Call Details
Bentley Systems will host a live Zoom video webinar on May 10,
2022 at 8:15 a.m. Eastern time to discuss operating results for its
first quarter ended March 31, 2022.
Those wishing to participate should access the live Zoom video
webinar of the event through a direct registration link at
https://zoom.us/webinar/register/WN_4aR1BzzRQJCALyGU052TrQ.
Alternatively, the event can be accessed from the Events &
Presentations page on Bentley Systems’ Investor Relations website
at https://investors.bentley.com. In addition, a replay and
transcript will be available after the conclusion of the live event
on Bentley Systems’ Investor Relations website for one year.
Definitions of Certain Key Business Metrics
Definitions of the non-GAAP financial measures used in this
operating results press release and reconciliations of such
measures to their nearest GAAP equivalents are included below under
“Use and Reconciliation of Non-GAAP Financial Measures.”
- Last twelve-month recurring revenues are calculated as
recurring revenues recognized over the preceding twelve-month
period. We define recurring revenues as subscription revenues that
recur monthly, quarterly, or annually with specific or automatic
renewal clauses and professional services revenues in which the
underlying contract is based on a fixed fee and contains automatic
annual renewal provisions;
- Business performance is defined as organic growth results
inclusive of the impact from the ARR onboarding of certain
programmatic acquisitions, which generally are immaterial,
individually and in the aggregate, and is exclusive of the ARR
onboarding of our Seequent and Power Line Systems platform
acquisitions;
- GAAP net income margin is determined by dividing GAAP net
income by total revenues;
- Adjusted EBITDA margin is determined by dividing Adjusted
EBITDA by total revenues; and
- Adjusted Net Income per diluted share is determined by dividing
Adjusted Net Income by the weighted average diluted shares.
Constant Currency Metrics
In reporting period-over-period results, we calculate the
effects of foreign currency fluctuations and constant currency
information by translating current period results using prior
period average foreign currency exchange rates. Our definition of
constant currency may differ from other companies reporting
similarly named measures, and these constant currency performance
measures should be viewed in addition to, and not as a substitute
for, our operating performance measures calculated in accordance
with GAAP.
- Our last twelve-month recurring revenues dollar-based net
retention rate is calculated, using the average exchange rates for
the prior period, as follows: the recurring revenues for the
current period, including any growth or reductions from accounts
with recurring revenues in the prior period (“existing accounts”),
but excluding recurring revenues from any new accounts added during
the current period, divided by the total recurring revenues from
all accounts during the prior period. A period is defined as any
trailing twelve months.
- Our last twelve-month account retention rate for any given
twelve-month period is calculated using the average currency
exchange rates for the prior period, as follows: the prior period
recurring revenues from all accounts with recurring revenues in the
current and prior period, divided by total recurring revenues from
all accounts during the prior period.
- Our constant currency ARR growth rate is the growth rate of our
ARR, measured on a constant currency basis. Our ARR is defined as
the sum of the annualized value of our portfolio of contracts that
produce recurring revenue as of the last day of the reporting
period, and the annualized value of the last three months of
recognized revenues for our contractually recurring
consumption-based software subscriptions with consumption
measurement durations of less than one year.
Use and Reconciliation of Non-GAAP Financial Measures
In addition to our results determined in accordance with GAAP,
we have calculated Adjusted cost of subscriptions and licenses,
Adjusted cost of services, Adjusted research and development,
Adjusted selling and marketing, Adjusted general and
administrative, Adjusted income from operations, Adjusted Net
Income, and Adjusted EBITDA, each of which are non-GAAP financial
measures. We have provided tabular reconciliations of each of these
non-GAAP financial measures to such measure’s most directly
comparable GAAP financial measure.
Management uses these non-GAAP financial measures to understand
and compare operating results across accounting periods, for
internal budgeting and forecasting purposes, and to evaluate
financial performance. Our non-GAAP financial measures are
presented as supplemental disclosure as we believe they provide
useful information to investors and others in understanding and
evaluating our results and prospects period-over-period without the
impact of certain items that do not directly correlate to our
operating performance and that may vary significantly from period
to period for reasons unrelated to our operating performance, as
well as to compare our financial results to those of other
companies. Our definitions of these non-GAAP financial measures may
differ from similarly titled measures presented by other companies
and therefore comparability may be limited. In addition, other
companies may not publish these or similar metrics. Thus, our
non-GAAP financial measures should be considered in addition to,
not as a substitute for, or in isolation from, the financial
information prepared in accordance with GAAP, and should be read in
conjunction with the financial statements included in our Quarterly
Report on Form 10-Q to be filed with the United States Securities
and Exchange Commission.
We calculate these non-GAAP financial measures as follows:
- Adjusted cost of subscriptions and licenses is determined by
adding back to GAAP cost of subscriptions and licenses,
amortization of purchased intangibles and developed technologies,
stock-based compensation, and acquisition expenses, for the
respective periods;
- Adjusted cost of services is determined by adding back to GAAP
cost of services, stock-based compensation, and acquisition
expenses, for the respective periods;
- Adjusted research and development is determined by adding back
to GAAP research and development, stock-based compensation, and
acquisition expenses, for the respective periods;
- Adjusted selling and marketing is determined by adding back to
GAAP selling and marketing, stock-based compensation, and
acquisition expenses, for the respective periods;
- Adjusted general and administrative is determined by adding
back to GAAP general and administrative, stock-based compensation,
and acquisition expenses, for the respective periods;
- Adjusted income from operations is determined by adding back to
GAAP operating income, amortization of purchased intangibles and
developed technologies, stock-based compensation, expense (income)
relating to deferred compensation plan liabilities, and acquisition
expenses for the respective periods;
- Adjusted Net Income is defined as net income adjusted for the
following: amortization of purchased intangibles and developed
technologies, stock-based compensation, expense (income) relating
to deferred compensation plan liabilities, acquisition expenses,
other non-operating (income) expense, net, the tax effect of the
above adjustments to net income, and (income) loss from investment
accounted for using the equity method, net of tax. The income tax
effect of non-GAAP adjustments was determined using the applicable
rates in the taxing jurisdictions in which income or expense
occurred, and represent both current and deferred income tax
expense or benefit based on the nature of the non-GAAP adjustments,
including the tax effects of non-cash stock-based compensation
expense;
- Adjusted EBITDA is defined as net income adjusted for interest
expense, net, provision (benefit) for income taxes, depreciation
and amortization, stock-based compensation, expense (income)
relating to deferred compensation plan liabilities, acquisition
expenses, other non-operating (income) expense, net, and (income)
loss from investment accounted for using the equity method, net of
tax.
We encourage investors and others to review our financial
information in its entirety, not to rely on any single financial
measure, and to view these non-GAAP financial measures in
conjunction with the related GAAP financial measures. During the
third quarter of 2021, the Company modified its definitions of
Adjusted EBITDA and Adjusted Net Income to adjust for expense
(income) relating to deferred compensation plan liabilities and
amounts for all periods herein reflect application of the modified
definition.
Forward-Looking Statements
This press release includes forward-looking statements regarding
the future results of operations and financial position, business
strategy, and plans and objectives for future operations of Bentley
Systems, Incorporated (the “Company,” “we,” “us,” and words of
similar import). All such statements contained in this press
release, other than statements of historical facts, are
forward-looking statements. The words “believe,” “may,” “will,”
“estimate,” “continue,” “anticipate,” “intend,” “expect,” and
similar expressions are intended to identify forward-looking
statements. We have based these forward-looking statements largely
on our current expectations, projections, and assumptions about
future events and financial trends that we believe may affect our
financial condition, results of operations, business strategy,
short-term and long-term business operations and objectives, and
financial needs. These forward-looking statements are subject to a
number of risks, uncertainties and assumptions, and there are a
significant number of factors that could cause actual results to
differ materially from statements made in this press release
including: current and potential future impacts of the COVID-19
pandemic on the global economy and our business, and consolidated
financial statements; adverse changes in global economic and/or
political conditions; the impact of current and future sanctions,
embargoes and other similar laws at the state and/or federal level
that impose restrictions on our counterparties or upon our ability
to operate our business within the subject jurisdictions;
political, economic, regulatory and public health and safety risks
and uncertainties in the countries and regions in which we operate;
failure to retain personnel necessary for the operation of our
business or those that we acquire; changes in the industries in
which our accounts operate; the competitive environment in which we
operate; the quality of our products; our ability to develop and
market new products to address our accounts’ rapidly changing
technological needs; changes in capital markets and our ability to
access financing on terms satisfactory to us or at all; and our
ability to integrate acquired businesses successfully.
Further information on potential factors that could affect the
financial results of the Company are included in the Company’s Form
10-K and subsequent Forms 10-Q, which are on file with the United
States Securities and Exchange Commission. The Company disclaims
any obligation to update the forward-looking statements provided to
reflect events that occur or circumstances that exist after the
date on which they were made.
About Bentley Systems
Bentley Systems (Nasdaq: BSY) is the infrastructure engineering
software company. We provide innovative software to advance the
world’s infrastructure – sustaining both the global economy and
environment. Our industry-leading software solutions are used by
professionals, and organizations of every size, for the design,
construction, and operations of roads and bridges, rail and
transit, water and wastewater, public works and utilities,
buildings and campuses, mining, and industrial facilities. Our
offerings include MicroStation-based applications for modeling and
simulation, ProjectWise for project delivery, AssetWise for asset
and network performance, Seequent’s leading geoprofessional
software portfolio, and the iTwin platform for infrastructure
digital twins. Bentley Systems employs more than 4,500 colleagues
and generates annual revenues of approximately $1 billion in 186
countries. www.bentley.com
© 2022 Bentley Systems, Incorporated. Bentley, the Bentley logo,
AssetWise, iTwin, MicroStation, ProjectWise, Seequent, Power Line
Systems, and ADINA are either registered or unregistered trademarks
or service marks of Bentley Systems, Incorporated or one of its
direct or indirect wholly owned subsidiaries. All other brands and
product names are trademarks of their respective owners.
BENTLEY SYSTEMS, INCORPORATED
AND SUBSIDIARIES
Consolidated Balance
Sheets
(in thousands)
(unaudited)
March 31, 2022
December 31, 2021
Assets
Current assets:
Cash and cash equivalents
$
129,617
$
329,337
Accounts receivable
233,032
241,807
Allowance for doubtful accounts
(7,486
)
(6,541
)
Prepaid income taxes
26,254
16,880
Prepaid and other current assets
32,644
34,348
Total current assets
414,061
615,831
Property and equipment, net
32,043
31,823
Operating lease right-of-use assets
49,432
50,818
Intangible assets, net
329,029
245,834
Goodwill
2,217,578
1,588,477
Investments
8,680
6,438
Deferred income taxes
47,683
71,376
Other assets
59,797
48,646
Total assets
$
3,158,303
$
2,659,243
Liabilities and Stockholders’
Equity
Current liabilities:
Accounts payable
$
19,058
$
16,483
Accruals and other current liabilities
351,273
323,603
Deferred revenues
215,448
224,610
Operating lease liabilities
16,963
17,482
Income taxes payable
5,048
6,696
Current portion of long-term debt
5,000
5,000
Total current liabilities
612,790
593,874
Long-term debt
1,871,527
1,430,992
Deferred compensation plan liabilities
89,282
94,890
Long-term operating lease liabilities
34,907
35,274
Deferred revenues
13,006
7,983
Deferred income taxes
58,316
65,014
Income taxes payable
7,718
7,725
Other liabilities
13,104
14,269
Total liabilities
2,700,650
2,250,021
Stockholders’ equity:
Common stock
2,851
2,825
Additional paid-in capital
957,498
937,805
Accumulated other comprehensive loss
(75,324
)
(91,774
)
Accumulated deficit
(427,372
)
(439,634
)
Total stockholders’ equity
457,653
409,222
Total liabilities and stockholders’
equity
$
3,158,303
$
2,659,243
BENTLEY SYSTEMS, INCORPORATED
AND SUBSIDIARIES
Consolidated Statements of
Operations
(in thousands, except share
and per share data)
(unaudited)
Three Months Ended
March 31,
2022
2021
Revenues:
Subscriptions
$
241,233
$
188,125
Perpetual licenses
10,205
10,116
Subscriptions and licenses
251,438
198,241
Services
24,079
23,764
Total revenues
275,517
222,005
Cost of revenues:
Cost of subscriptions and licenses
33,727
28,945
Cost of services
22,058
20,344
Total cost of revenues
55,785
49,289
Gross profit
219,732
172,716
Operating expense (income):
Research and development
61,273
47,803
Selling and marketing
45,945
32,440
General and administrative
51,154
33,221
Deferred compensation plan
(5,138
)
167
Amortization of purchased intangibles
9,906
3,438
Total operating expenses
163,140
117,069
Income from operations
56,592
55,647
Interest expense, net
(7,042
)
(2,319
)
Other income, net
10,641
14,482
Income before income taxes
60,191
67,810
Provision for income taxes
(3,231
)
(10,358
)
Loss from investment accounted for using
the equity method, net of tax
(572
)
(446
)
Net income
56,388
57,006
Less: Net income attributable to
participating securities
(9
)
—
Net income attributable to Class A and
Class B common stockholders
$
56,379
$
57,006
Per share information:
Net income per share, basic
$
0.18
$
0.19
Net income per share, diluted
$
0.18
$
0.18
Weighted average shares, basic
307,969,672
302,583,452
Weighted average shares, diluted
331,330,256
321,736,649
BENTLEY SYSTEMS, INCORPORATED
AND SUBSIDIARIES
Consolidated Statements of
Cash Flows
(in thousands)
(unaudited)
Three Months Ended
March 31,
2022
2021
Cash flows from operating activities:
Net income
$
56,388
$
57,006
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization
17,212
8,993
Bad debt allowance
955
746
Deferred income taxes
9,042
966
Stock-based compensation expense
15,099
8,913
Deferred compensation plan
(5,138
)
1,021
Amortization and write-off of deferred
debt issuance costs
1,778
1,229
Change in fair value of derivative
(12,084
)
(13,661
)
Change in fair value of contingent
consideration
500
—
Change on fair value of investments
(112
)
—
Gain on sale of aircraft
(2,029
)
—
Foreign currency remeasurement loss
(gain)
1,677
(583
)
Loss from investment accounted for using
the equity method, net of tax
572
446
Changes in assets and liabilities, net of
effect from acquisitions:
Accounts receivable
8,691
14,903
Prepaid and other assets
5,718
8,257
Accounts payable, accruals, and other
liabilities
26,791
54,977
Deferred revenues
(12,515
)
(21,889
)
Income taxes payable, net of prepaid
income taxes
(10,814
)
11,474
Net cash provided by operating
activities
101,731
132,798
Cash flows from investing activities:
Purchases of property and equipment and
investment in capitalized software
(4,176
)
(2,655
)
Proceeds from sale of aircraft
2,380
—
Acquisitions, net of cash acquired
(695,968
)
(57,975
)
Other investing activities
(2,811
)
—
Net cash used in investing activities
(700,575
)
(60,630
)
Cash flows from financing activities:
Proceeds from credit facilities
563,912
16,000
Payments of credit facilities
(123,696
)
(262,000
)
Proceeds from convertible senior notes,
net of discounts and commissions
—
672,750
Payments of debt issuance costs
—
(3,777
)
Purchase of capped call options
—
(25,530
)
Repayment of term loan
(1,250
)
—
Payments of financing leases
(48
)
(50
)
Payments of acquisition debt and other
consideration
(2,721
)
(25
)
Payments of dividends
(8,528
)
(8,219
)
Payments for shares acquired including
shares withheld for taxes
(35,117
)
(18,763
)
Proceeds from stock purchases under
employee stock purchase plan
4,611
—
Proceeds from exercise of stock
options
2,768
1,751
Net cash provided by financing
activities
399,931
372,137
Effect of exchange rate changes on cash
and cash equivalents
(807
)
3,225
(Decrease) increase in cash and cash
equivalents
(199,720
)
447,530
Cash and cash equivalents, beginning of
year
329,337
122,006
Cash and cash equivalents, end of
period
$
129,617
$
569,536
BENTLEY SYSTEMS, INCORPORATED
AND SUBSIDIARIES
Reconciliation of GAAP to
Non-GAAP Measures
For the Three Months Ended
March 31, 2022 and 2021
(in thousands)
(unaudited)
Reconciliation of net income to Adjusted
EBITDA:
Three Months Ended
March 31,
2022
2021
Net income
$
56,388
$
57,006
Interest expense, net
7,042
2,319
Provision for income taxes
3,231
10,358
Depreciation and amortization
17,212
8,993
Stock-based compensation
14,953
8,913
Deferred compensation plan
(5,138
)
167
Acquisition expenses
13,997
9,256
Other income, net
(10,641
)
(14,482
)
Loss from investment accounted for using
the equity method, net of tax
572
446
Adjusted EBITDA
$
97,616
$
82,976
Reconciliation of net income to Adjusted
Net Income:
Three Months Ended
March 31,
2022
2021
Net income
$
56,388
$
57,006
Non-GAAP adjustments, prior to income
taxes:
Amortization of purchased intangibles and
developed technologies
12,928
4,683
Stock-based compensation
14,953
8,913
Deferred compensation plan
(5,138
)
167
Acquisition expenses
13,997
9,256
Other income, net
(10,641
)
(14,482
)
Total non-GAAP adjustments, prior to
income taxes
26,099
8,537
Income tax effect of non-GAAP
adjustments
(3,503
)
(1,859
)
Loss from investment accounted for using
the equity method, net of tax
572
446
Adjusted Net Income
$
79,556
$
64,130
Reconciliation of GAAP Financial Statement
Line Items to Non-GAAP Adjusted Financial Statement Line Items:
Three Months Ended
March 31,
2022
2021
Cost of subscriptions and licenses
$
33,727
$
28,945
Amortization of purchased intangibles and
developed technologies
(3,022
)
(1,245
)
Stock-based compensation
(380
)
(86
)
Adjusted cost of subscriptions and
licenses
$
30,325
$
27,614
Cost of services
$
22,058
$
20,344
Stock-based compensation
(371
)
(235
)
Acquisition expenses
(1,324
)
(966
)
Adjusted cost of services
$
20,363
$
19,143
Research and development
$
61,273
$
47,803
Stock-based compensation
(5,349
)
(3,909
)
Acquisition expenses
(1,651
)
(1,374
)
Adjusted research and development
$
54,273
$
42,520
Selling and marketing
$
45,945
$
32,440
Stock-based compensation
(1,371
)
(690
)
Acquisition expenses
(423
)
(44
)
Adjusted selling and marketing
$
44,151
$
31,706
General and administrative
$
51,154
$
33,221
Stock-based compensation
(7,482
)
(3,993
)
Acquisition expenses
(10,599
)
(6,860
)
Adjusted general and administrative
$
33,073
$
22,368
Income from operations
$
56,592
$
55,647
Amortization of purchased intangibles and
developed technologies
12,928
4,683
Stock-based compensation
14,953
8,913
Deferred compensation plan
(5,138
)
167
Acquisition expenses
13,997
9,256
Adjusted income from operations
$
93,332
$
78,666
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220510005161/en/
Investor Contact: Ankit Hira Solebury Trout for Bentley Systems
ir@bentley.com 1-610-458-2777
Media Contact: Carey Mann carey.mann@bentley.com
1-610-458-3170
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