Slide 1: Q4 and FY 2023 Results, 2024 Financial Outlook
Greg Bentley Q4 and FY 2023 Results, Chief Executive Officer Nicholas Cumins 2024 Financial Outlook Chief Operating Officer Werner Andre February 27, 2024 | © 2024 Bentley Systems, Incorporated 1 Chief © 2024Financial Bentley Systems,Officer Incorporated |
Slide 2: Disclaimer
Disclaimer This presentation includes forward-looking statements regarding the future operate; the quality of our products; our ability to develop and market new results of operations and financial position, business strategy, and plans and products to address our accounts’ rapidly changing technolo
Slide 3: Agenda
Agenda Directions and Developments Greg Bentley, Chief Executive Officer Operational Perspectives Nicholas Cumins, Chief Operating Officer Financial Performance Werner Andre, Chief Financial Officer 3 © 2024 Bentley Systems, Incorporated |
Slide 4: Directions (2023-2024)
Directions (2023 2024) Greg Bentley, Chief Executive Officer 4 © 2024 Bentley Systems, Incorporated |
Slide 5: YoY ARR Growth
YoY ARR Growth8 Constant Currency Business Performance 14.0% Outlook Range 12.0% 12%-13% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 20Q1 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2 22Q3 22Q4 23Q1 23Q2 23Q3 23Q4 Note: Annualized Recurring Revenue (“ARR”)6 Footnotes 6,8 : See appendix for KPI and non-GAAP defini
Slide 6: YoY ARR Growth
YoY ARR Growth8 Constant Currency Business Performance 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 20Q1 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2 22Q3 22Q4 23Q1 23Q2 23Q3 As reported Ex-China Note: Annualized Recurring Revenue (“ARR”)6 Footnotes 6,8 : See appendix for KPI and non-GAAP definitions
Slide 7: YoY ARR Growth
YoY ARR Growth8 Constant Currency Business Performance 13.5% 14.0% Ex-China 12.0% 12.5% As reported 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 20Q1 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2 22Q3 22Q4 23Q1 23Q2 23Q3 23Q4 As reported Ex-China Note: Annualized Recurring Revenue (“ARR”)6 Footnotes 6,8 : See appe
Slide 8: YoY ARR Growth
YoY ARR Growth8 Constant Currency Business Performance 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 20Q1 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2 22Q3 22Q4 23Q1 23Q2 23Q3 23Q4 As reported Ex-China Note: Annualized Recurring Revenue (“ARR”)6 Footnotes 6,8 : See appendix for KPI and non-GAAP definit
Slide 9: YoY ARR Growth
YoY ARR Growth8 Constant Currency Business Performance 14.0% 12.0% 10.0% 8.0% New (Logos, Products, Programmatic Acquisitions) 6.0% Mix (Application Upsell) 4.0% Volume (Consumption) 2.0% Escalation (Annual Pricing) 0.0% 20Q1 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2 22Q3 22Q4 23Q1 23Q2 23Q3 23Q4
Slide 10: YoY ARR Growth
YoY ARR Growth8 Constant Currency Business Performance 14.0% 12.0% 10.0% 8.0% New (Logos, Products, Programmatic Acquisitions) 6.0% Mix (Application Upsell) 4.0% Volume (Consumption) 2.0% Escalation (Annual Pricing) 0.0% 20Q1 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2 22Q3 22Q4 23Q1 23Q2 23Q3 23Q4
Slide 11: Virtuosity ARR
Virtuosity ARR 6 $50M $45M $40M $35M $30M $25M $20M $15M $10M $5M $- 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2 22Q3 22Q4 23Q1 23Q2 23Q3 23Q4 Notes: All periods use exchange rates as of Dec 31, 2023 Footnotes 6 : See appendix for KPI and non-GAAP definitions 11 © 2024 Bentley Systems, Incorporated
Slide 12: YoY ARR Growth
YoY ARR Growth8 Constant Currency Business Performance 14.0% 12.0% 10.0% 8.0% New (Logos, Products, Programmatic Acquisitions) 6.0% Mix (Application Upsell) 4.0% Volume (Consumption) 2.0% Escalation (Annual Pricing) 0.0% 20Q1 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2 22Q3 22Q4 23Q1 23Q2 23Q3 23Q4
Slide 13: YoY LTM Recurring Revenues Dollar-Based Net Retention Rate
YoY LTM Recurring Revenues Dollar-Based Net Retention Rate5 (NRR) Constant Currency Business Performance 111% 110% 109% 108% 107% 106% 105% 104% 20Q1 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2 22Q3 22Q4 23Q1 23Q2 23Q3 Footnote 5: See appendix for KPI and non-GAAP definitions 13 © 2024 Bentley Syst
Slide 14: YoY LTM Recurring Revenues Dollar-Based Net Retention Rate
YoY LTM Recurring Revenues Dollar-Based Net Retention Rate5 (NRR) Constant Currency Business Performance 111% 110% 109% 108% 107% 106% 105% 104% 20Q1 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2 22Q3 22Q4 23Q1 23Q2 23Q3 23Q4 Footnote 5: See appendix for KPI and non-GAAP definitions 14 © 2024 Bentley
Slide 15: ARR by Account Size
ARR6 by Account Size End of 23Q3 E365 SMB E365 Prospects Note: Chart segment sizing corresponds to underlying % of 23Q3 ARR 6 Footnote 6 : See appendix for KPI and non-GAAP definitions 15 © 2024 Bentley Systems, Incorporated |
Slide 16: ARR by Account Size
ARR6 by Account Size End of 23Q4 E365 SMB E365 Prospects E365 growth during 23Q4 Note: Chart segment sizing corresponds to underlying % of 23Q4 ARR 6 Footnote 6 : See appendix for KPI and non-GAAP definitions 16 © 2024 Bentley Systems, Incorporated |
Slide 17: Directions (2023-2024): Multi-year E365 negotiations
Directions (2023 2024) Multi-year E365 (floor and ceiling) negotiations – Milestone 9-figure contract – No effect on E365 ratable accounting and annual cashflow – Immaterial multi-year bookings or billings 17 © 2024 Bentley Systems, Incorporated |
Slide 18: YoY ARR Growth: Sustained at High-water Mark
YoY ARR Growth8 Sustained at High-water Mark… Constant Currency Business Performance 14.0% 12.0% 10.0% 8.0% New (Logos, Products, Programmatic Acquisitions) 6.0% Mix (Application Upsell) 4.0% Volume (Consumption) 2.0% Escalation (Annual Pricing) 0.0% 20Q1 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2
Slide 19: YoY ARR Growth
YoY ARR Growth8 Constant Currency Business Performance 14.0% 12.0% 10.0% 8.0% New (Logos, Products, Programmatic Acquisitions) 6.0% Mix (Application Upsell) 4.0% Volume (Consumption) 2.0% Escalation (Annual Pricing) 0.0% 20Q1 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2 22Q3 22Q4 23Q1 23Q2 23Q3 23Q4
Slide 20: Percentage of (Engineering) Hours Saved by Finalists
Project Name Organization Saved Hours N4 Montrose Interchange SMEC South Africa 42% 41% South Africa RSAS – Carstairs Arcadis 35% 35% India Digital Twins and Artificial Intelligence for United States of America Historic Robert Street Bridge Rehabilitation Collins Engineers, Inc. 33% 33% Percentage A
Slide 21: YoY ARR Growth: Sustained at High-water Mark
YoY ARR Growth8 Sustained at High-water Mark… Constant Currency Business Performance 14.0% 12.0% 10.0% 8.0% New (Logos, Products, Programmatic Acquisitions) 6.0% Mix (Application Upsell) 4.0% Volume (Consumption) 2.0% Escalation (Annual Pricing) 0.0% 20Q1 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2
Slide 22: Application Mix Accretion
Application Mix Accretion ~6.0 % ~4.5 % 2022 2023 22 © 2024 Bentley Systems, Incorporated |
Slide 23: Opportunities in Engineering News-Record Top Design Firms
Opportunities in Engineering News-Record (Global) Top Design Firms BSY as Established Leader, with Long Upside Runway for Going Digital The China Opportunity ~$150.00 (ex-China) $1.41 Design Billing Hour Average BSY Application Cost $216 Billion 637 Firms (Globally) Design Billings $.39 Average Proj
Slide 24: 2024 Developments
2024 Developments Greg Bentley, Chief Executive Officer 24 © 2024 Bentley Systems, Incorporated |
Slide 25: Growth Initiative (3) - Digital Twins (Powered by iTwin Platform)
Growth Initiative (3) - Digital Twins (Powered by iTwin Platform) Cloud Services Synchronizing, Aligning, Federating Infrastructure Engineering Data for Metaverse, AI Accessibility r m o Cloud tf e ur la n P s t n ruc io AssetWise t i Tw i Bentley Infrast ic asional Appl ProjectWise SYNCHRO Modeling
Slide 26: Cohesive Acquisitions
Cohesive Announces The Cohesive Companies The Cohesive Companies Digital Integrator Cohesive Acquisition of Expand in Transportation Announce the Acquisition Group Acquires Vetasi, MaximoCon, Technical Infrastructure Globally with of Ontracks Consulting, Leading Provider of IBM Maximo Consultancy Ac
Slide 27: Growth Initiative (3) - Digital Twins (Powered by iTwin Platform)
Growth Initiative (3) - Digital Twins (Powered by iTwin Platform) Cloud Services Synchronizing, Aligning, Federating Infrastructure Engineering Data for Metaverse, AI Accessibility r m o Cloud tf e ur la n P s t n ruc io AssetWise t i Tw i Bentley Infrast ic asional Appl ProjectWise SYNCHRO Modeling
Slide 28: 2024 Developments: Asset Analytics
2024 Developments Asset Analytics 28 © 2024 Bentley Systems, Incorporated |
Slide 29: Launches OpenTower iQ Digital Co-Venture for 5G Towers
Bentley Acceleration Initiatives Launches OpenTower iQ, a Digital Co-Venture with Visual Intelligence and Aeroprotechnik for 5G Towers Video Courtesy of Visual Intelligence Millimeter-accurate Digital Twin Solution Combines Patented Dual-sensor Drone Technologies and Artificial Intelligence to Help
Slide 30: iTwin Ventures Acquires Blyncsy
Bentley Systems’ iTwin Ventures Acquires Blyncsy, Breakthrough Innovator in AI Services for Transportation Operations and Maintenance To Broaden and Accelerate Infrastructure Asset Analytics August 14, 2023 www.bentley.com/newsroom 34 30 © 2024 Bentley Systems, Incorporated |
Slide 31: 2024 Developments: Asset Analytics
2024 Developments Asset Analytics – AI-as-a-service – Scale opportunity – Consolidating investment program – Tolerably afforded 31 © 2024 Bentley Systems, Incorporated |
Slide 32: YoY ARR Growth
YoY ARR Growth8 Constant Currency Business Performance 14.0% 12.0% 10.0% 8.0% New (Logos, Products, Programmatic Acquisitions) 6.0% Mix (Application Upsell) 4.0% Volume (Consumption) 2.0% Escalation (Annual Pricing) 0.0% 20Q1 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2 22Q3 22Q4 23Q1 23Q2 23Q3 23Q4
Slide 33: YoY ARR Growth
YoY ARR Growth8 Constant Currency Business Performance 14.0% 12.0% 10.0% 8.0% New (Logos, Products, Programmatic Acquisitions) 6.0% Mix (Application Upsell) 4.0% Volume (Consumption) 2.0% Escalation (Annual Pricing) 0.0% 20Q1 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2 22Q3 22Q4 23Q1 23Q2 23Q3 23Q4
Slide 34: YoY ARR Growth with Outlook Range
YoY ARR Growth8 Constant Currency Business Performance 14.0% Outlook Range 12.0% 10.5%-13% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 20Q1 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2 22Q3 22Q4 23Q1 23Q2 23Q3 23Q4 24Q1 24Q2 24Q3 24Q4 As reported Excluding programmatic acquisitions Ex-China Note: Annualized Recu
Slide 35: Compounding Operating Profit (Adjusted OI w/SBC)
Compounding Operating Profit (Adjusted OI w/SBC) $400 28.0% 25.4% 26.0% $350 $325 * % $300 22.7% k) : 16 $274 24.0% 21.9% 22.1% u tloo O * 8-2024 $(13)* 22.0% $250 G R (201 CA $245* 20.0% $200 $(42)* $167 $152 18.0% $150 $177* 16.0% $100 14.0% $50 12.0% $371 $152 $167 $219 $258 $274 $325 ($ in Milli
Slide 36: Agenda
Agenda Directions and Developments Greg Bentley, Chief Executive Officer Operational Perspectives Nicholas Cumins, Chief Operating Officer Financial Performance Werner Andre, Chief Financial Officer 36 © 2024 Bentley Systems, Incorporated |
Slide 37: Operational Perspectives
Operational Perspectives Nicholas Cumins, Chief Operating Officer 37 © 2024 Bentley Systems, Incorporated |
Slide 38: Higher Backlog 12 Months from Now
Higher Backlog 12 Months from Now Net Rating Trend +37 +37 +33 +27 +25 22Q3 22Q4 23Q2 23Q3 23Q4 Source: ACEC Research Institute Engineering Business Sentiment © | 2023 Q4- https://programs.acec.org/impact-report-21/ 38 © 2024 Bentley Systems, Incorporated |
Slide 39: Tone of Business by Infrastructure Sector
Tone of Business by Infrastructure Sector Growth in Public Works/Utilities Leads the Way Commercial/Facilities Industrial Public Works/ 23Q4 ARR6 Resources Resources Utilities Note: Chart segment sizing corresponds to underlying % of 23Q4 Sector-attributable ARR6 Footnote 6 : See appendix for KPI an
Slide 40: Notable Q4 Developments Across Geographies
Notable Q4 Developments Across Geographies Strong Performance Across the Board Americas EMEA Asia Pacific Very solid growth Solid growth Steady growth • North America leading growth • Strong quarter across • Outsourcing driving growth in SEA Enterprise and SMB • Momentum with US DOTs • Strength in R
Slide 41: Civil Engineering with Seequent Geoprofessional
Civil Engineering with Seequent Winner Going Digital Award in Geoprofessional Driving Efficiency and Sustainability in Material Reuse Through GeoBIM Mott MacDonald Birmingham, West Midlands, United Kingdom Project Playbook: Keynetix, OpenRoads, ProjectWise, Seequent Images Credit: Mott MacDonald 41
Slide 42: Agenda
Agenda Directions and Developments Greg Bentley, Chief Executive Officer Operational Perspectives Nicholas Cumins, Chief Operating Officer Financial Performance Werner Andre, Chief Financial Officer 42 © 2024 Bentley Systems, Incorporated |
Slide 43: Financial Performance
Financial Performance Werner Andre, Chief Financial Officer 43 © 2024 Bentley Systems, Incorporated |
Slide 44: Revenue Performance
Revenue Performance Fourth Quarter Full Year $ in millions $ in millions +12% (CC +12%) CC constant currency1 CC constant currency1 $1,228 +7% (CC +7%) 102 $1,099 +6% (CC +7%) 46 95 43 $311 +8% (CC +7%) $287 25 +9% (CC +7%) +13% (CC +13%) 23 13 +6% (CC +6%) 1,080 12 960 272 +8% (CC +7%) 251 22Q4 23Q
Slide 45: Recurring Revenue Performance
Recurring Revenue Performance LTM Recurring Revenues3 LTM Recurring Revenue Retention $ in millions Constant Currency1, YoY CC constant currency1 109% 110% 110% 110% 110% 109% 107% 108% 107% 9.0 10.0 9.0 11.0 12.0 12.0 12.0 13.0 11.0 $1,097 $978 +12% (CC +12%) 98% 98% 98% 99% 98% 98% 98% 97% 98% LTM
Slide 46: Recurring Revenue Performance
Recurring Revenue Performance ARR Growth7,8 ARR6: $1,175 million at 12/31/2023 Spot Rates Constant Currency1, YoY Business Performance8 27% Impact from the onboarding of 26% 26% Platform Acquisitions 23% 13% 13% 15% Seequent 21Q2 to 22Q1 and 13% 15% Power Line Systems 14% 14% 22Q1 to 22Q4 2.5% 2.5%
Slide 47: Profitability Performance
Profitability Performance GAAP Operating Income Adjusted OI w/ SBC9 $ in millions $ in millions 26.4% Adj. OI w/ SBC Margin10 24.9% Adj. OI w/ SBC $325 Margin10 $231 $209 $274 +19% +11% 24.0% Adj. OI w/ SBC 22.5% Margin10 Adj. OI w/ SBC Margin10 $75 $64 $41 $38 +16% -7% 22Q4 23Q4 22Q4 23Q4 22Q4 23Q4
Slide 48: Liquidity and Capital Structure
Liquidity and Capital Structure GAAP Operating Cash Flows 12/31/2023 Credit Metrics $ in millions $ in millions Fourth Quarter Full Year Cash $ 68 Senior Debta $ 282 $417 Net Senior Debtb $ 214 Net Senior Debt Leveragec 0.5x $274 Available Revolver Credit Capacity $ 758 +52% • Senior debt excludes $
Slide 49: Full Year 2024 Financial Outlook
Full Year 2024 Financial Outlook Financial Metrics Outlook Total Revenues $1,350 million to $1,375 milliona (+10% to 12% in constant currencya) ARR Growth8 (constant currency1) 10.5% to 13%b Adjusted OI w/SBC Margin10 Approximately 100bps annual improvement Effective Tax Rate Approximately 20% Cash
Slide 50: Appendix
Appendix 50 © 2024 Bentley Systems, Incorporated |
Slide 51: KPI and Non-GAAP Definitions
KPI and Non-GAAP Definitions This presentation includes certain KPIs and non-GAAP financial measures, which are defined herein. Reconciliations of non-GAAP financial measures to their most directly comparable GAAP financial measures are included in our Form 8-K (Quarterly Earnings Release) announcin
Slide 52: KPI and Non-GAAP Definitions
KPI and Non-GAAP Definitions 5. LTM Recurring revenues dollar-based net retention rate. Our LTM 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
Slide 53: Adjusted EBITDA
Adjusted EBITDA11 Reconciliation of cash flow from operations to Adjusted EBITDA11 $ in millions 23Q4 LTM Cash flow from operations $ 417 Cash interest 37 Cash taxes 43 Cash deferred compensation plan distributions 2 Cash acquisition expenses 21 Change in operating assets and liabilities (94) Othera
Slide 54: Consolidated Revenues (Constant Currency Definition Change)
Consolidated Revenues (Constant Currency Definition Change) Current Definition % Change 2022 to 2023 % Change 2021 to 2022 Constant Constant Year Ended December 31 Currency Currency 2023 2022 2021 % %(1) % %(1) Subscriptions $1,080,307 $ 960,220 $ 812,807 12.5% 12.5% 18.1% 22.0% Perpetual licenses 4
Slide 55: Non-GAAP Reconciliations (Constant Currency)
Non-GAAP Reconciliations (Constant Currency) Reconciliation of consolidated revenues to consolidated revenues in constant currency Current Definition - % Change 2022 to 2023 Year Ended December 31, 2023 Year Ended December 31, 2022 Impact of Impact of Constant Constant Actual Foreign Exchange Actual
Slide 56: Non-GAAP Reconciliations (Constant Currency)
Non-GAAP Reconciliations (Constant Currency) Reconciliation of consolidated revenues to consolidated revenues in constant currency Prior Definition Year Ended December 31, 2023 Year Ended December 31, 2022 Impact of Constant Impact of Constant Actual Actual Foreign Exchange Currency Foreign Exchange