Slide 1: 24Q2 Results
24Q2 Results Greg Bentley, EC, Nicholas Cumins, CEO, Werner Andre, CFO August 6, 2024 © 2024 Bentley Systems, Incorporated | 1
Slide 2: Agenda
Directions and Developments Greg Bentley, Executive Chair Operational Perspectives Nicholas Cumins, Chief Executive Officer Agenda Financial Performance Werner Andre, Chief Financial Officer Q&A © 2024 Bentley Systems, Incorporated | 2
Slide 3: Disclaimer
Disclaimer This presentation 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 st
Slide 4: Directions and Developments
Directions and Developments Greg Bentley, Executive Chair © 2024 Bentley Systems, Incorporated | 4
Slide 5: BSY Busyness…
BSY Busyness… • QUALITY of ARR Growth • QUALITY of Revenue Growth • QUALITY of Revenues • QUALITY of Operating Profitability • Contribution from Asset Analytics © 2024 Bentley Systems, Incorporated | 5
Slide 6: © 2024 Bentley Systems, Incorporated | 6
© 2024 Bentley Systems, Incorporated | 6
Slide 7: CEO Compensation Transition
CEO Compensation Transition As part of Gregory S. Bentley’s transition to the role of UNITED STATES Executive Chair, on June 26, 2024, the Committee SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 approved Amendment No. 2 to the Bentley Systems, FORM 8-K/A Incorporated Amended and Restated
Slide 8: Compounding Growth…
Compounding Growth… Historical financials $M USD 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2024 Outlook Revenue Recurring Revenues2 Adjusted OI w/S
Slide 9: Career Stock Program
Career Stock Program In connection with Mr. Cumins’ transition to the role of CEO, the Committee adopted a compensatory program (the UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 “Career Stock Program”) pursuant to which the Company FORM 8-K/A may grant RSU awards under the
Slide 10: Career Stock Program
Career Stock Program • Established % of (Growth in) AOI w/SBC • 5-year (cliff) Vesting– and Visibility! • Acceleration of vesting on retirement © 2024 Bentley Systems, Incorporated | 10
Slide 11: Directions and Developments
Directions and Developments Greg Bentley, Executive Chair © 2024 Bentley Systems, Incorporated | 11
Slide 12: Operational Perspectives
Operational Perspectives Nicholas Cumins, Chief Executive Officer © 2024 Bentley Systems, Incorporated | 12
Slide 13: Tone of Business
Tone of Business • Strong quarter with very positive end-market and operational momentum • ARR performance was broad-based across industries and geographies • E365 and Virtuosity growth initiatives continued to be strong contributors • Two headwinds to our performance continue to be China for ARR an
Slide 14: YoY ARR Growth
YoY ARR Growth 8 Consistent results benefiting from secular tailwinds and strong execution Constant Currency Business Performance 14% 13% 12% 11% 10% 9% 8% 7% 6% 5% 4% 3% 2% 1% 0% 20Q1 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2 22Q3 22Q4 23Q1 23Q2 23Q3 23Q4 24Q1 24Q2 Our constant currency ARR grow
Slide 15: YoY ARR Growth - Ex China
YoY ARR Growth - Ex China 8 China down to 2.5% of total ARR Constant Currency Business Performance 14% 13% 12% 11% 10% 9% 8% 7% 6% 5% 4% 3% 2% 1% 0% 20Q1 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2 22Q3 22Q4 23Q1 23Q2 23Q3 23Q4 24Q1 24Q2 As reported Ex-China Note: Annualized Recurring Revenue (“ARR
Slide 16: ARR by Account Size
ARR by Account Size 6 E365 remains major growth driver: conversions and application mix accretion End of 24Q2 E365 SMB E365 Prospects E365 growth during 24Q2 Note: Chart segment sizing corresponds to underlying % of 24Q2 ARR6 | Footnote 6: See appendix for KPI and non-GAAP definitions © 2024 Bentley
Slide 17: ARR by Account Size
ARR by Account Size 6 SMB new logos contributed 4 ppts. to ARR growth End of 24Q2 E365 SMB E365 Prospects Note: Chart segment sizing corresponds to underlying % of 24Q2 ARR6 | Footnote 6: See appendix for KPI and non-GAAP definitions © 2024 Bentley Systems, Incorporated | 17
Slide 18: Virtuosity ARR
Virtuosity ARR 6 Tenth straight quarter of at least 600 new logos $60M $55M $50M $45M $40M $35M $30M $25M $20M $15M $10M $5M $- 23Q1 23Q2 23Q3 23Q4 20Q2 20Q3 20Q4 22Q1 22Q2 22Q3 22Q4 21Q1 21Q2 21Q3 21Q4 24Q1 24Q2 Note: All periods use exchange rates as of June 30, 2024 | Footnote 6: See appendix for
Slide 19: Higher Backlog Expected 12 Months from Now
Higher Backlog Expected 12 Months from Now Net rating trend +40 +39 +37 +37 +32 23Q2 23Q3 23Q4 24Q1 24Q2 Source: ACEC Research Institute Engineering Business Sentiment -> https://www.acec.org/resource/engineering-business-sentiment-2024-q2/ © 2024 Bentley Systems, Incorporated | 19
Slide 20: Sentiment 12 Months from Now Remains Strong
Sentiment 12 Months from Now Remains Strong Condition of the Condition of the engineering Condition of your firm’s U.S. Economy and design services industry overall finances 50 43 48 45 40 40 35 30 30 25 26 20 13 16 9 10 10 0 23Q2 23Q3 23Q4 24Q1 24Q2 23Q2 23Q3 23Q4 24Q1 24Q2 -10 -2 -20 -16 -30 -24 2
Slide 21: Tone of Business by Infrastructure Sector
Tone of Business by Infrastructure Sector Strength in Public Works/Utilities followed by Resources Commercial/Facilities Industrial Public Works/ 24Q2 ARR6 Resources Resources Utilities Note: Chart segment sizing corresponds to underlying % of 24Q2 Sector-attributable ARR6 | Footnote 6: See appendix
Slide 22: Notable Q2 Developments Across Geographies
Notable Q2 Developments Across Geographies Consistent performance continued Americas EMEA Asia Pacific Strong growth Steady growth Strong growth • North America led the way • Public Works and Resources • Australia/New Zealand stood out drove growth as growth driver • Continued IIJA tailwinds • Do no
Slide 23: Pennsylvania Department of Transportation (PennDOT)
Image courtesy of PennDOT: I-90 Reconstruction Project, District 1, Erie County Pennsylvania Department of Transportation PennDOT Contracts with Bentley Systems to (PennDOT) Advance Project Delivery Extends Commitment to Bentley CADD Solutions EXTON, PA. – August 6, 2024 – Bentley Systems, Incorpora
Slide 24: Financial Performance
Financial Performance Werner Andre, Chief Financial Officer © 2024 Bentley Systems, Incorporated | 24
Slide 25: Revenue Performance
Revenue Performance Second Quarter First Half $ in millions $ in millions CC constant currency1 CC constant currency1 $668 +9% (CC +9%) $611 43 -18% (CC -18%) 20 -4% (CC -3%) 53 21 $330 +11% (CC +12%) $297 22 -15% (CC -14%) 26 11 -7% (CC -6%) 605 +13% (CC +13%) 12 537 297 +15% (CC +15%) 259 23Q2 24Q
Slide 26: Recurring Revenue Performance
Recurring Revenue Performance LTM Recurring Revenues3 LTM Recurring Revenue Retention $ in millions $ in millions CC constant currency1 Constant currency1, YoY 108% 109% 110% 109% 108% 108% 107% $1,163 $1,042 +12% (CC +11%) 98% 98% 98% 98% 98% 99% 99% LTM 23Q2 LTM 24Q2 2019 2020 2021 2022 2023 24Q1
Slide 27: Recurring Revenue Performance
Recurring Revenue Performance ARR Growth7,8 ARR6: $1,216 million at 06/30/2024 Spot Rates $ in millions Business Performance8 Constant currency1, YoY 27% 26% 26% Impact from the onboarding of Platform Acquisitions 23% 13% 13% 15% Seequent 21Q2 to 22Q1 and 13% 15% Power Line Systems 22Q1 to 22Q4 14%
Slide 28: Profitability Performance
Profitability Performance GAAP Operating Income Adjusted OI w/ SBC9 $ in millions $ in millions 31.1% Adj. OI w/ SBC Margin10 26.8% $208 Adj. OI w/ SBC Margin10 $164 $172 +27% 28.8% Adj. OI w/ SBC Margin10 24.7% $119 Adj. OI w/ SBC Margin10 $95 +45% $80 $73 +30% $53 +50% 23Q2 24Q2 23Q2 24Q2 23Q2 24Q
Slide 29: Liquidity and Capital Structure
Liquidity and Capital Structure GAAP Operating Cash Flows 24Q2 Credit Metrics $ in millions $ in millions Second First Half Last Twelve Cash $ 51 Quarter Months Senior Debta $ 85 $427 Net Senior Debtb $ 34 $362 +18% Net Senior Debt Leveragec 0.1x $257 $268 Available Revolver Credit Capacity $ 850 +4
Slide 30: 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 31: Q&A
Q&A Eric Boyer, Investor Relations Officer © 2024 Bentley Systems, Incorporated | 31
Slide 32: Appendix
Appendix © 2024 Bentley Systems, Incorporated | 32
Slide 33: 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 34: KPI and Non-GAAP Definitions
KPI and Non-GAAP Definitions 6. Annualized Recurring Revenues (“ARR”). Our ARR is defined as the sum of the annualized value of our portfolio of contracts that produce recurring revenues as of the last day of the reporting period, and the annualized value of the last three months of recognized reven
Slide 35: Adjusted EBITDA
Adjusted EBITDA 11 Reconciliation of cash flow from operations to Adjusted EBITDA11 Last Twelve Months Reconciliation of cash flow from operations to Adjusted EBITDA $ in millions $ in thousands LTM 24Q2 Cash flow from operations $ 427,432 $465 Cash interest 26,713 Cash taxes 47,279 Cash deferred co
Slide 36: Non-GAAP Reconciliations (Constant Currency)
Non-GAAP Reconciliations (Constant Currency) Reconciliation of total revenues and subscriptions revenues to total revenues and subscriptions revenues in constant currency $ in thousands Three Months Ended June 30, 2024 Three Months Ended June 30, 2023 Impact of Foreign Impact of Foreign Constant Con
Slide 37: Historical OI to Adjusted OI w/SBC
Historical OI to Adjusted OI w/SBC ($ in thousands) 2018 2019 2020 2021 2022 2023 Operating income $ 121,391 $ 141,865 $ 150,150 $ 94,589 $ 208,612 $ 230,542 Amortization of purchased intangibles 17,215 18,731 20,721 34,001 53,592 51,219 Deferred compensation plan (75) 408 177 95,046 (15,782) 13,580