Nemetschek maintains operating margin at 20 percent

  • Half-year figures presented
  • drop in revenues of 11 percent
  • EBITDA margin stable at 19.8 percent
  • operative cash flow of 13.6 million euros
  • outlook confirmed for the overall year

Munich, August 7, 2009 – Nemetschek AG (ISIN 0006452907), Europe's largest vendor of software for architecture, civil engineering and the construction industry generated revenues of 65.2 million euros in the first half of 2009. Compared to the strong revenues generated in the same six-month period of the previous year (73.3 million euros), this represents a drop in revenues of 11 percent. Thanks to strict cost discipline, the company managed to keep its operating margin (EBITDA) stable as expected. The EBITDA amounted to 12.9 million euros after 15.3 million euros in the same six months of the previous year, putting the EBITDA margin at 19.8 percent. The net income was 4.7 million euros after 7.0 million euros in the previous year.

Maintenance revenues at previous year's levels

The loss in revenues for the first six months is due to declining revenues from license sales. They fell in the first half-year by 20.9 percent from 37.5 million euros to 29.7 million euros. On the other hand, recurring revenues from maintenance contracts remained stable at 30.6 million euros. Service revenues from consulting and training were 4.7 million euros compared to 4.9 million euros for the same period in the previous year. Domestic revenues amounted to 27.5 million euros, putting them at the same level as in the previous year (27.4 million euros). Revenue development abroad was negative, however, amounting to 37.8 million euros (previous year: 45.9 million euros). Foreign revenues therefore represented 58 percent of overall revenues.

All segments profitable

All segments in the group were profitable in the first half-year of 2009. The Design segment - comprising software solutions focused on architecture and civil engineering - once again represented the bulk of the group's revenues at 53.1 million euros (previous year: 60.8 million euros). The EBITDA margin was 17.8 percent (previous year: 20.2 percent). The company showed slight growth in the Build and Manage segments. In the Build segment - comprising alphanumerical software products to support the construction process - revenues grew from 6.5 million euros to 6.7 million euros. The EBITDA margin was 36.9 percent (previous year: 27.9 percent). The Manage segment with its solutions for real estate business management saw revenues of 2 million euros (after 1.9 million euros in the previous year), the EBITDA margin rose to 14.6 percent (previous year: - 5.8 percent). The Multimedia segment (3D software for visualization and animation) achieved revenues of 3.5 million euros (previous year: 4.1 million euros). The EBITDA margin was 20.9 percent (previous year: 31.5 percent).

Costs significantly reduced

Thanks to strict cost management, the Nemetschek Group was able to make up for a good part of the loss in revenues. Personnel costs for the first half-year remained largely stable at 30.8 million euros (previous year: 30.5 million euros) but they can be expected to fall further in the second half-year as the result of selective personnel measures in individual subsidiaries. Other operating expenses were reduced by 18.6 percent from 24.1 million euros to 19.7 million euros. This is due to several individual measures throughout all of the group companies, including savings in advertising, sales expenditures and external personnel costs. Operating expenses sank by a total of 8.0 percent.

With 4.8 million euros of depreciations - of which 3.6 million euros are amortizations for intangible assets from the allocation of the purchasing price for Graphisoft and Scia- the operating profit (EBIT) was 8.1 million euros (10.4 million euros in the previous year). The net income was 4.7 million euros (previous year: 7.0 million euros). The earnings per share (consolidated shares) were 0.48 euros, compared to 0.69 euros in the previous year.

Equity ratio at 45 percent

In the first half of 2009 the Nemetschek Group generated cash flow from operating activities of 13.6 million euros (previous year: 16.2 million euros). The cash flow from financing activities was 10.9 million euros (previous year: - 22.0 million euros). This is due to the repayment of 9.6 million euros of loan debt on June 30, 2009. The value for the previous year mainly included repayments of 12.8 million euros as well as dividend payments of 7 million euros.

The company's liquid assets stand at 23.4 million euros compared to 20.9 million euros in the same period of the previous year. This puts the company's current net debt at just 16.3 million euros (compared to 26.1 million euros on December 31, 2008). Equity is at 72.1 million euros compared to 67.9 million euros on December 31, 2008. Nemetschek Group's equity ratio is 45 percent.

Drop in number of employees

On June 30, 2009, the Nemetschek Group employed 1,073 people. At the end of 2008 it employed 1,114 people worldwide.

Outlook confirmed

The end of the worldwide economic crisis is not yet in sight and it has also made its mark on the building industry. According to the forecasts updated in June 2009, Euroconstruct, the industry group, expects revenues in the European building industry to drop by 9.9 percent. Euroconstruct expects revenues in Germany to drop by four percent in 2009; according to industry representatives, the various economic packages are only being felt slowly by the building companies. 'We do not expect to see a market upturn until the fourth quarter at the earliest,' says Ernst Homolka, CEO, Nemetschek AG.

The management, however, still assumes that, with an expected drop in revenues of around 10 percent in fiscal 2009, it will be able to keep the group's operating margin (EBITDA margin) at around 20 percent.