Bentley Systems Announces Fourth Quarter and Full Year 2023 Results and 2024 Financial Outlook
Increases Quarterly Dividend
Fourth Quarter 2023 Results
- Total revenues were
$310.6 million , up 8.3% or 7.3% on a constant currency basis, year-over-year;
- Subscriptions revenues were
$272.5 million , up 8.3% or 7.4% on a constant currency basis, year-over-year;
- Annualized Recurring Revenues (“ARR”) was
$1,174.8 million as ofDecember 31, 2023 , compared to$1,036.5 million as ofDecember 31, 2022 , representing a constant currency ARR growth rate of 12.5%;
- Last twelve-month recurring revenues dollar-based net retention rate was 109%, compared to 110% for the same period last year;
- Operating income margin was 12.2%, compared to 14.2% for the same period last year;
- Adjusted operating income inclusive of stock-based compensation expense (“Adjusted OI w/SBC”) margin was 24.0%, compared to 22.5% for the same period last year;
- Net income per diluted share was
$0.54 , compared to$0.08 for the same period last year;
- Adjusted net income per diluted share (“Adjusted EPS”) was
$0.20 , compared to$0.19 for the same period last year; and
- Cash flow from operations was
$87.1 million , compared to$36.1 million for the same period last year.
Full Year 2023 Results
- Total revenues were
$1,228.4 million , up 11.8% or 11.9% on a constant currency basis over 2022;
- Subscriptions revenues were
$1,080.3 million , up 12.5% or 12.5% on a constant currency basis over 2022;
- Operating income margin was 18.8%, compared to 19.0% for 2022;
- Adjusted OI w/SBC margin was 26.4%, compared to 24.9% for 2022;
- Net income per diluted share was
$1.00 , compared to$0.55 for 2022;
- Adjusted EPS was
$0.91 , compared to$0.85 for 2022; and
- Cash flow from operations was
$416.7 million , compared to$274.3 million for 2022.
CEO
“Our financial outlook for 2024 reflects our confidence in sustaining consistent organic growth with comparable annual improvement in operating margin (including stock‑based compensation). Our investment programs will prioritize outright acquisitions in asset analytics, where our breakthrough offerings for communications towers (OpenTower) and for roadway conditions (Blyncsy) are proving that AI now enables ‘instant-on’ infrastructure digital twins, at scale. I believe that asset analytics cloud services, monetized per asset, can significantly increase our total addressable market and digital twin growth.”
COO
CFO
Recent Developments
- During the fourth quarter of 2023, we recognized a net discrete income tax benefit of
$170.8 million attributable to internal legal entity restructuring and related intra-entity transactions as part of our continuing efforts to align intellectual property ownership with our business operating model; and
- During the fourth quarter of 2023, we recorded a
$12.6 million charge for realignment expenses primarily to provide for severance (affecting under 5% of our workforce) in order to reinvest in go-to-market functions, as well as in AI product development.
2024 Financial Outlook
The Company is sharing the following financial outlook for the full year 2024:
- Total revenues in the range of
$1,350 million to$1,375 million and constant currency growth of 10% to 12%;
- Constant currency ARR growth rate (business performance, including programmatic acquisitions) of 10.5% to 13%;
- Adjusted OI w/SBC margin annual improvement of approximately 100 basis points;
- Effective tax rate of approximately 20%;
- Cash flow from operations representing a conversion rate from Adjusted EBITDA of approximately 80%; and
- Capital expenditures of approximately
$22 million .
The 2024 outlook information provided above includes non-GAAP financial measures management uses in measuring performance and liquidity. The Company is unable to reconcile these forward-looking non-GAAP measures to GAAP without unreasonable efforts because it is not possible to predict with a reasonable degree of certainty the actual impact of certain items and unanticipated events, including stock‑based compensation charges, amortization of acquired intangible assets, realignment expenses, and other items, which would be included in GAAP results. The impact of such items and unanticipated events could be potentially significant.
The 2024 outlook is forward-looking, subject to significant business, economic, regulatory, and competitive uncertainties and contingencies, many of which are beyond the control of the Company and its management, and based upon assumptions with respect to future decisions, which are subject to change. Actual results may vary and those variations may be material. As such, our results may not fall within the ranges contained in this outlook. The Company uses these forward-looking measures to evaluate its ongoing operations and for internal planning and forecasting purposes.
Increased Quarterly Cash Dividend
On
Call Details
Those wishing to participate should access the live Zoom video webinar of the event through a direct registration link at https://us06web.zoom.us/webinar/register/WN_N_lpPc0VQsKFdbH7fLbm1A#/registration. 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.
Non-GAAP Financial Measures
In this press release, we sometimes refer to financial measures that are not presented in accordance with
During the fourth quarter of 2023, the Company changed its definitions of constant currency and constant currency growth rates. We made this modification in order to better align with how we manage the business, to better reflect our performance during a reporting period, and to make the effects of foreign currency fluctuations and constant currency information more easily comparable on a period‑over‑period basis.
We are providing what our constant currency and constant currency growth rates results would have been pursuant to the prior definition for the applicable periods so that investors and potential investors that have analyzed these non-GAAP financial measures historically using our prior definitions can compare our historical results to our current results with respect to these non-GAAP financial measures using the prior definitions. Refer to the section titled “Reconciliation of GAAP to Non‑GAAP Financial Measures” for reconciliations of constant currency non‑GAAP financial measures to their most directly comparable GAAP financial measures under the current and prior definitions.
Forward-Looking Statements
This press release includes forward-looking statements regarding the future results of operations and financial condition, business strategy, and plans and objectives for future operations of
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 Form 10‑Qs, which are on file with the
About
© 2024
Consolidated Balance Sheets (in thousands) (unaudited) |
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|
||||||
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2023 |
|
2022 |
||||
Assets |
|
|
|
|
||||
Current assets: |
|
|
|
|
||||
Cash and cash equivalents |
|
$ |
68,412 |
|
|
$ |
71,684 |
|
Accounts receivable |
|
|
302,501 |
|
|
|
296,376 |
|
Allowance for doubtful accounts |
|
|
(8,965 |
) |
|
|
(9,303 |
) |
Prepaid income taxes |
|
|
12,812 |
|
|
|
18,406 |
|
Prepaid and other current assets |
|
|
44,797 |
|
|
|
38,732 |
|
Total current assets |
|
|
419,557 |
|
|
|
415,895 |
|
Property and equipment, net |
|
|
40,100 |
|
|
|
32,251 |
|
Operating lease right-of-use assets |
|
|
38,476 |
|
|
|
40,249 |
|
Intangible assets, net |
|
|
248,787 |
|
|
|
292,271 |
|
|
|
|
2,269,336 |
|
|
|
2,237,184 |
|
Investments |
|
|
23,480 |
|
|
|
22,270 |
|
Deferred income taxes |
|
|
212,831 |
|
|
|
52,636 |
|
Other assets |
|
|
67,283 |
|
|
|
72,249 |
|
Total assets |
|
$ |
3,319,850 |
|
|
$ |
3,165,005 |
|
Liabilities and Stockholders’ Equity |
|
|
|
|
||||
Current liabilities: |
|
|
|
|
||||
Accounts payable |
|
$ |
18,094 |
|
|
$ |
15,176 |
|
Accruals and other current liabilities |
|
|
457,348 |
|
|
|
362,048 |
|
Deferred revenues |
|
|
253,785 |
|
|
|
226,955 |
|
Operating lease liabilities |
|
|
11,645 |
|
|
|
14,672 |
|
Income taxes payable |
|
|
9,491 |
|
|
|
4,507 |
|
Current portion of long-term debt |
|
|
10,000 |
|
|
|
5,000 |
|
Total current liabilities |
|
|
760,363 |
|
|
|
628,358 |
|
Long-term debt |
|
|
1,518,403 |
|
|
|
1,775,696 |
|
Deferred compensation plan liabilities |
|
|
88,181 |
|
|
|
77,014 |
|
Long-term operating lease liabilities |
|
|
30,626 |
|
|
|
27,670 |
|
Deferred revenues |
|
|
15,862 |
|
|
|
16,118 |
|
Deferred income taxes |
|
|
9,718 |
|
|
|
51,235 |
|
Income taxes payable |
|
|
7,337 |
|
|
|
8,105 |
|
Other liabilities |
|
|
5,378 |
|
|
|
7,355 |
|
Total liabilities |
|
|
2,435,868 |
|
|
|
2,591,551 |
|
Stockholders’ equity: |
|
|
|
|
||||
Common stock |
|
|
2,963 |
|
|
|
2,890 |
|
Additional paid-in capital |
|
|
1,127,234 |
|
|
|
1,030,466 |
|
Accumulated other comprehensive loss |
|
|
(84,987 |
) |
|
|
(89,740 |
) |
Accumulated deficit |
|
|
(161,932 |
) |
|
|
(370,866 |
) |
Non-controlling interest |
|
|
704 |
|
|
|
704 |
|
Total stockholders’ equity |
|
|
883,982 |
|
|
|
573,454 |
|
Total liabilities and stockholders’ equity |
|
$ |
3,319,850 |
|
|
$ |
3,165,005 |
|
Consolidated Statements of Operations (in thousands, except share and per share data) (unaudited) |
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|
|
Three Months Ended |
|
Year Ended |
||||||||||||
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|
|
|
|
||||||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||||
Revenues: |
|
|
|
|
|
|
|
|
||||||||
Subscriptions |
|
$ |
272,468 |
|
|
$ |
251,489 |
|
|
$ |
1,080,307 |
|
|
$ |
960,220 |
|
Perpetual licenses |
|
|
12,886 |
|
|
|
12,164 |
|
|
|
46,038 |
|
|
|
43,377 |
|
Subscriptions and licenses |
|
|
285,354 |
|
|
|
263,653 |
|
|
|
1,126,345 |
|
|
|
1,003,597 |
|
Services |
|
|
25,287 |
|
|
|
23,295 |
|
|
|
102,068 |
|
|
|
95,485 |
|
Total revenues |
|
|
310,641 |
|
|
|
286,948 |
|
|
|
1,228,413 |
|
|
|
1,099,082 |
|
Cost of revenues: |
|
|
|
|
|
|
|
|
||||||||
Cost of subscriptions and licenses |
|
|
45,231 |
|
|
|
39,674 |
|
|
|
169,406 |
|
|
|
147,578 |
|
Cost of services |
|
|
22,566 |
|
|
|
22,677 |
|
|
|
96,677 |
|
|
|
89,435 |
|
Total cost of revenues |
|
|
67,797 |
|
|
|
62,351 |
|
|
|
266,083 |
|
|
|
237,013 |
|
Gross profit |
|
|
242,844 |
|
|
|
224,597 |
|
|
|
962,330 |
|
|
|
862,069 |
|
Operating expense (income): |
|
|
|
|
|
|
|
|
||||||||
Research and development |
|
|
71,237 |
|
|
|
67,890 |
|
|
|
274,619 |
|
|
|
257,856 |
|
Selling and marketing |
|
|
64,074 |
|
|
|
53,946 |
|
|
|
224,336 |
|
|
|
195,622 |
|
General and administrative |
|
|
51,995 |
|
|
|
45,666 |
|
|
|
180,738 |
|
|
|
174,647 |
|
Deferred compensation plan |
|
|
8,817 |
|
|
|
6,091 |
|
|
|
13,580 |
|
|
|
(15,782 |
) |
Amortization of purchased intangibles |
|
|
8,948 |
|
|
|
10,245 |
|
|
|
38,515 |
|
|
|
41,114 |
|
Total operating expenses |
|
|
205,071 |
|
|
|
183,838 |
|
|
|
731,788 |
|
|
|
653,457 |
|
Income from operations |
|
|
37,773 |
|
|
|
40,759 |
|
|
|
230,542 |
|
|
|
208,612 |
|
Interest expense, net |
|
|
(9,170 |
) |
|
|
(11,114 |
) |
|
|
(39,793 |
) |
|
|
(34,635 |
) |
Other (expense) income, net |
|
|
(14,429 |
) |
|
|
9,505 |
|
|
|
(7,222 |
) |
|
|
24,298 |
|
Income before income taxes |
|
|
14,174 |
|
|
|
39,150 |
|
|
|
183,527 |
|
|
|
198,275 |
|
Benefit (provision) for income taxes |
|
|
165,348 |
|
|
|
(13,062 |
) |
|
|
143,241 |
|
|
|
(21,283 |
) |
Gain (loss) from investments accounted for using the equity method, net of tax |
|
|
63 |
|
|
|
(366 |
) |
|
|
19 |
|
|
|
(2,212 |
) |
Net income |
|
$ |
179,585 |
|
|
$ |
25,722 |
|
|
$ |
326,787 |
|
|
$ |
174,780 |
|
Per share information: |
|
|
|
|
|
|
|
|
||||||||
Net income per share, basic |
|
$ |
0.57 |
|
|
$ |
0.08 |
|
|
$ |
1.05 |
|
|
$ |
0.57 |
|
Net income per share, diluted |
|
$ |
0.54 |
|
|
$ |
0.08 |
|
|
$ |
1.00 |
|
|
$ |
0.55 |
|
Weighted average shares, basic |
|
|
313,526,604 |
|
|
|
310,025,480 |
|
|
|
312,358,823 |
|
|
|
309,226,677 |
|
Weighted average shares, diluted |
|
|
333,418,588 |
|
|
|
323,916,511 |
|
|
|
332,503,633 |
|
|
|
331,765,158 |
|
Consolidated Statements of Cash Flows (in thousands) (unaudited) |
||||||||
|
|
Year Ended |
||||||
|
|
|
||||||
|
|
2023 |
|
2022 |
||||
Cash flows from operating activities: |
|
|
|
|
||||
Net income |
|
$ |
326,787 |
|
|
$ |
174,780 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
||||
Depreciation, amortization, and impairment |
|
|
71,861 |
|
|
|
71,537 |
|
Deferred income taxes |
|
|
(198,878 |
) |
|
|
(5,126 |
) |
Stock-based compensation expense |
|
|
72,972 |
|
|
|
75,206 |
|
Deferred compensation plan |
|
|
13,580 |
|
|
|
(15,782 |
) |
Amortization and write-off of deferred debt issuance costs |
|
|
7,291 |
|
|
|
7,291 |
|
Change in fair value of derivative |
|
|
5,038 |
|
|
|
(27,083 |
) |
Foreign currency remeasurement (gain) loss |
|
|
(452 |
) |
|
|
6,000 |
|
Other |
|
|
21,047 |
|
|
|
2,593 |
|
Changes in assets and liabilities, net of effect from acquisitions: |
|
|
|
|
||||
Accounts receivable |
|
|
(5,180 |
) |
|
|
(60,938 |
) |
Prepaid and other assets |
|
|
4,112 |
|
|
|
14,053 |
|
Accounts payable, accruals, and other liabilities |
|
|
68,733 |
|
|
|
29,181 |
|
Deferred revenues |
|
|
19,933 |
|
|
|
2,292 |
|
Income taxes payable, net of prepaid income taxes |
|
|
9,852 |
|
|
|
320 |
|
Net cash provided by operating activities |
|
|
416,696 |
|
|
|
274,324 |
|
Cash flows from investing activities: |
|
|
|
|
||||
Purchases of property and equipment and investment in capitalized software |
|
|
(25,002 |
) |
|
|
(18,546 |
) |
Proceeds from sale of aircraft |
|
|
— |
|
|
|
2,380 |
|
Acquisitions, net of cash acquired |
|
|
(26,023 |
) |
|
|
(743,007 |
) |
Purchases of investments |
|
|
(11,602 |
) |
|
|
(10,954 |
) |
Proceeds from investments |
|
|
2,123 |
|
|
|
— |
|
Net cash used in investing activities |
|
|
(60,504 |
) |
|
|
(770,127 |
) |
Cash flows from financing activities: |
|
|
|
|
||||
Proceeds from credit facilities |
|
|
588,154 |
|
|
|
833,292 |
|
Payments of credit facilities |
|
|
(841,723 |
) |
|
|
(487,694 |
) |
Settlement of convertible senior notes |
|
|
— |
|
|
|
(1,998 |
) |
Repayments of term loan |
|
|
(5,000 |
) |
|
|
(5,000 |
) |
Payments of contingent and non-contingent consideration |
|
|
(4,324 |
) |
|
|
(8,460 |
) |
Payments of dividends |
|
|
(58,756 |
) |
|
|
(34,493 |
) |
Proceeds from stock purchases under employee stock purchase plan |
|
|
9,988 |
|
|
|
10,335 |
|
Proceeds from exercise of stock options |
|
|
11,715 |
|
|
|
8,338 |
|
Payments for shares acquired including shares withheld for taxes |
|
|
(58,937 |
) |
|
|
(43,561 |
) |
Repurchases of Class B Common Stock under approved program |
|
|
— |
|
|
|
(28,250 |
) |
Other |
|
|
(191 |
) |
|
|
525 |
|
Net cash (used in) provided by financing activities |
|
|
(359,074 |
) |
|
|
243,034 |
|
Effect of exchange rate changes on cash and cash equivalents |
|
|
(390 |
) |
|
|
(4,884 |
) |
Decrease in cash and cash equivalents |
|
|
(3,272 |
) |
|
|
(257,653 |
) |
Cash and cash equivalents, beginning of year |
|
|
71,684 |
|
|
|
329,337 |
|
Cash and cash equivalents, end of year |
|
$ |
68,412 |
|
|
$ |
71,684 |
|
Reconciliation of GAAP to Non-GAAP Financial Measures (in thousands, except share and per share data) (unaudited) |
||||||||||||||
Reconciliation of operating income to Adjusted OI w/SBC and to Adjusted operating income: |
||||||||||||||
|
|
Three Months Ended |
|
Year Ended |
||||||||||
|
|
|
|
|
||||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||
Operating income |
|
$ |
37,773 |
|
$ |
40,759 |
|
|
$ |
230,542 |
|
$ |
208,612 |
|
Amortization of purchased intangibles |
|
|
12,181 |
|
|
13,418 |
|
|
|
51,219 |
|
|
53,592 |
|
Deferred compensation plan |
|
|
8,817 |
|
|
6,091 |
|
|
|
13,580 |
|
|
(15,782 |
) |
Acquisition expenses |
|
|
2,588 |
|
|
4,342 |
|
|
|
17,866 |
|
|
25,398 |
|
Realignment expenses (income) |
|
|
13,270 |
|
|
(114 |
) |
|
|
11,470 |
|
|
2,109 |
|
Adjusted OI w/SBC |
|
|
74,629 |
|
|
64,496 |
|
|
|
324,677 |
|
|
273,929 |
|
Stock-based compensation expense |
|
|
16,563 |
|
|
23,592 |
|
|
|
71,470 |
|
|
74,566 |
|
Adjusted operating income |
|
$ |
91,192 |
|
$ |
88,088 |
|
|
$ |
396,147 |
|
$ |
348,495 |
|
Reconciliation of net income to Adjusted net income: |
|||||||||||||||||||||||||||||||
|
Three Months Ended |
|
Year Ended |
||||||||||||||||||||||||||||
|
|
|
|
||||||||||||||||||||||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||||||||||||||||||||
|
$ |
|
EPS(1) |
|
$ |
|
EPS(1) |
|
$ |
|
EPS(1) |
|
$ |
|
EPS(1) |
||||||||||||||||
Net income |
$ |
179,585 |
|
|
$ |
0.54 |
|
|
$ |
25,722 |
|
|
$ |
0.08 |
|
|
$ |
326,787 |
|
|
$ |
1.00 |
|
|
$ |
174,780 |
$ |
0.55 |
|
||
Non-GAAP adjustments, prior to income taxes: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Amortization of purchased intangibles |
|
12,181 |
|
|
|
0.04 |
|
|
|
13,418 |
|
|
|
0.04 |
|
|
|
51,219 |
|
|
|
0.15 |
|
|
|
53,592 |
|
|
|
0.16 |
|
Stock-based compensation expense |
|
16,563 |
|
|
|
0.05 |
|
|
|
23,592 |
|
|
|
0.07 |
|
|
|
71,470 |
|
|
|
0.21 |
|
|
|
74,566 |
|
|
|
0.22 |
|
Deferred compensation plan |
|
8,817 |
|
|
|
0.03 |
|
|
|
6,091 |
|
|
|
0.02 |
|
|
|
13,580 |
|
|
|
0.04 |
|
|
|
(15,782 |
) |
|
|
(0.05 |
) |
Acquisition expenses |
|
2,588 |
|
|
|
0.01 |
|
|
|
4,342 |
|
|
|
0.01 |
|
|
|
17,866 |
|
|
|
0.05 |
|
|
|
25,398 |
|
|
|
0.08 |
|
Realignment expenses (income) |
|
13,270 |
|
|
|
0.04 |
|
|
|
(114 |
) |
|
|
— |
|
|
|
11,470 |
|
|
|
0.03 |
|
|
|
2,109 |
|
|
|
0.01 |
|
Other expense (income), net |
|
14,429 |
|
|
|
0.04 |
|
|
|
(9,505 |
) |
|
|
(0.03 |
) |
|
|
7,222 |
|
|
|
0.02 |
|
|
|
(24,298 |
) |
|
|
(0.07 |
) |
Total non-GAAP adjustments, prior to income taxes |
|
67,848 |
|
|
|
0.20 |
|
|
|
37,824 |
|
|
|
0.11 |
|
|
|
172,827 |
|
|
|
0.52 |
|
|
|
115,585 |
|
|
|
0.35 |
|
Income tax effect of non-GAAP adjustments |
|
(12,333 |
) |
|
|
(0.04 |
) |
|
|
(4,227 |
) |
|
|
(0.01 |
) |
|
|
(31,636 |
) |
|
|
(0.10 |
) |
|
|
(18,059 |
) |
|
|
(0.05 |
) |
Tax benefit related to internal restructuring |
|
(170,784 |
) |
|
|
(0.51 |
) |
|
|
— |
|
|
|
— |
|
|
|
(170,784 |
) |
|
|
(0.51 |
) |
|
|
— |
|
|
|
— |
|
(Gain) loss from investments accounted for using the equity method, net of tax |
|
(63 |
) |
|
|
— |
|
|
|
366 |
|
|
|
— |
|
|
|
(19 |
) |
|
|
— |
|
|
|
2,212 |
|
|
|
0.01 |
|
Adjusted net income(2) |
$ |
64,253 |
|
|
$ |
0.20 |
|
|
$ |
59,685 |
|
|
$ |
0.19 |
|
|
$ |
297,175 |
|
|
$ |
0.91 |
|
|
$ |
274,518 |
|
|
$ |
0.85 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Adjusted weighted average shares, diluted(3) |
333,418,588 |
|
330,825,309 |
|
332,503,633 |
|
331,765,158 |
________________________ | |
(1) |
Adjusted EPS was computed independently for each reconciling item presented; therefore, the sum of Adjusted EPS for each line item may not equal total Adjusted EPS due to rounding. |
(2) |
Adjusted EPS numerator includes |
(3) |
Adjusted weighted average shares, diluted includes incremental shares, which were considered anti-dilutive on a GAAP basis, of 6,908,798 shares for the three months ended |
Reconciliation of cash flow from operations to Adjusted EBITDA: |
|||||||||||||||
|
Three Months Ended |
|
Year Ended |
||||||||||||
|
|
|
|
||||||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||||
Cash flow from operations |
$ |
87,053 |
|
|
$ |
36,126 |
|
|
$ |
416,696 |
|
|
$ |
274,324 |
|
Cash interest |
|
8,019 |
|
|
|
8,934 |
|
|
|
37,389 |
|
|
|
26,581 |
|
Cash taxes |
|
13,728 |
|
|
|
7,388 |
|
|
|
42,431 |
|
|
|
25,890 |
|
Cash deferred compensation plan distributions |
|
— |
|
|
|
— |
|
|
|
2,125 |
|
|
|
7,336 |
|
Cash acquisition expenses |
|
1,632 |
|
|
|
2,999 |
|
|
|
21,409 |
|
|
|
26,168 |
|
Changes in operating assets and liabilities |
|
(9,964 |
) |
|
|
38,588 |
|
|
|
(94,458 |
) |
|
|
8,088 |
|
Other(1) |
|
(2,383 |
) |
|
|
(1,472 |
) |
|
|
(8,803 |
) |
|
|
(1,947 |
) |
Adjusted EBITDA |
$ |
98,085 |
|
|
$ |
92,563 |
|
|
$ |
416,789 |
|
|
$ |
366,440 |
|
________________________ | |
(1) |
Includes receipts related to interest rate swap. |
Reconciliation of total revenues and subscription revenues to total revenues and subscription revenues in constant currency under the current and prior definitions: |
|||||||||||||||||
Current definition: |
|||||||||||||||||
|
Three Months Ended |
|
Three Months Ended |
||||||||||||||
|
Actual |
|
Impact of Foreign Exchange at 2022 Rates |
|
Constant Currency |
|
Actual |
|
Impact of Foreign Exchange at 2022 Rates |
|
Constant Currency |
||||||
Total revenues |
$ |
310,641 |
|
$ |
(2,549) |
|
$ |
308,092 |
|
$ |
286,948 |
|
$ |
274 |
|
$ |
287,222 |
Subscriptions revenues |
$ |
272,468 |
|
$ |
(2,147) |
|
$ |
270,321 |
|
$ |
251,489 |
|
$ |
278 |
|
$ |
251,767 |
|
Year Ended |
|
Year Ended |
||||||||||||||
|
Actual |
|
Impact of Foreign Exchange at 2022 Rates |
|
Constant Currency |
|
Actual |
|
Impact of Foreign Exchange at 2022 Rates |
|
Constant Currency |
||||||
Total revenues |
$ |
1,228,413 |
|
$ |
2,486 |
|
$ |
1,230,899 |
|
$ |
1,099,082 |
|
$ |
981 |
|
$ |
1,100,063 |
Subscriptions revenues |
$ |
1,080,307 |
|
$ |
1,239 |
|
$ |
1,081,546 |
|
$ |
960,220 |
|
$ |
809 |
|
$ |
961,029 |
Prior definition: |
|||||||||||||||||
|
Three Months Ended |
|
Year Ended |
||||||||||||||
|
Actual |
|
Impact of Foreign Exchange |
|
Constant Currency |
|
Actual |
|
Impact of Foreign Exchange |
|
Constant Currency |
||||||
Total revenues |
$ |
310,641 |
|
$ |
(5,723) |
|
$ |
304,918 |
|
$ |
1,228,413 |
|
$ |
(7,664) |
|
$ |
1,220,749 |
Subscriptions revenues |
$ |
272,468 |
|
$ |
(5,107) |
|
$ |
267,361 |
|
$ |
1,080,307 |
|
$ |
(8,095) |
|
$ |
1,072,212 |
Comparison of total revenues and subscription revenues growth rates to total revenues and subscription revenues constant currency growth rates under the current and prior definitions: |
|||||||||||||||||||
Current definition: |
|||||||||||||||||||
|
Three Months Ended |
|
% Change |
|
Year Ended |
|
% Change |
||||||||||||
|
|
|
2022 to 2023 |
|
|
|
2022 to 2023 |
||||||||||||
|
2023 |
|
2022 |
|
% |
|
Constant Currency % |
|
2023 |
|
2022 |
|
% |
|
Constant Currency % |
||||
Total revenues |
$ |
310,641 |
|
$ |
286,948 |
|
8.3% |
|
7.3% |
|
$ |
1,228,413 |
|
$ |
1,099,082 |
|
11.8% |
|
11.9% |
Subscriptions revenues |
$ |
272,468 |
|
$ |
251,489 |
|
8.3% |
|
7.4% |
|
$ |
1,080,307 |
|
$ |
960,220 |
|
12.5% |
|
12.5% |
Prior definition: |
|||||||||||||||||||
|
Three Months Ended |
|
% Change |
|
Year Ended |
|
% Change |
||||||||||||
|
|
|
2022 to 2023 |
|
|
|
2022 to 2023 |
||||||||||||
|
2023 |
|
2022 |
|
% |
|
Constant Currency % |
|
2023 |
|
2022 |
|
% |
|
Constant Currency % |
||||
Total revenues |
$ |
310,641 |
|
$ |
286,948 |
|
8.3% |
|
6.3% |
|
$ |
1,228,413 |
|
$ |
1,099,082 |
|
11.8% |
|
11.1% |
Subscriptions revenues |
$ |
272,468 |
|
$ |
251,489 |
|
8.3% |
|
6.3% |
|
$ |
1,080,307 |
|
$ |
960,220 |
|
12.5% |
|
11.7% |
Explanation of Non-GAAP and Other Financial Measures
Constant currency
Constant currency and constant currency growth rates are non-GAAP financial measures that present our results of operations excluding the estimated effects of foreign currency exchange rate fluctuations. A significant amount of our operations is conducted in foreign currencies. As a result, the comparability of the financial results reported in
During the fourth quarter of 2023, we changed our definitions of constant currency and constant currency growth rates. In reporting period‑over‑period results, we calculate the effects of foreign currency fluctuations and constant currency information by translating current period results on a transactional basis to our reporting currency using prior period average foreign currency exchange rates in which the transactions occurred. Our prior definition of constant currency calculated the effects of foreign currency fluctuations and constant currency information by translating current period results of our subsidiaries from their functional currencies to our reporting currency by using prior period average foreign currency exchange rates in reporting period‑over‑period results.
We made this modification in order to better align with how we manage the business, to better reflect our performance during a reporting period, and to make the effects of foreign currency fluctuations and constant currency information more easily comparable on a period‑over‑period basis.
Recurring revenues
Recurring revenues are the basis for our other revenue-related key business metrics. We believe this measure is useful in evaluating our ability to consistently retain and grow our revenues from accounts with revenues in the prior period (“existing accounts”).
Recurring revenues are subscriptions 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.
Annualized recurring revenues (“ARR”)
ARR is a key business metric that we believe is useful in evaluating the scale and growth of our business as well as to assist in the evaluation of underlying trends in our business. Furthermore, we believe ARR, considered in connection with our last twelve‑month recurring revenues dollar‑based net retention rate, is a leading indicator of revenue growth.
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 revenues for our contractually recurring consumption‑based software subscriptions with consumption measurement durations of less than one year, calculated using the spot foreign currency exchange rates. We believe that the last three months of recognized revenues, on an annualized basis, for our recurring software subscriptions with consumption measurement period durations of less than one year is a reasonable estimate of the annual revenues, given our consistently high retention rate and stability of usage under such subscriptions.
Constant currency ARR growth rate is the growth rate of ARR measured on a constant currency basis. Constant currency ARR growth rate from business performance excludes the ARR onboarding of our platform acquisitions and includes the impact from the ARR onboarding of programmatic acquisitions, which generally are immaterial, individually and in the aggregate. We believe these ARR growth rates are important metrics indicating the scale and growth of our business.
Last twelve‑month recurring revenues dollar‑based net retention rate
Last twelve‑month recurring revenues dollar‑based net retention rate is a key business metric that we believe is useful in evaluating our ability to consistently retain and grow our recurring revenues.
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 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. Related to our platform acquisitions, recurring revenues into new accounts will be captured as existing accounts starting with the second anniversary of the acquisition when such data conforms to the calculation methodology. This may cause variability in the comparison.
Adjusted operating income inclusive of stock-based compensation expense (“Adjusted OI w/SBC”)
Adjusted OI w/SBC is a non-GAAP financial measure and is used to measure the operational strength and performance of our business, as well as to assist in the evaluation of underlying trends in our business.
Adjusted OI w/SBC is our primary performance measure, which excludes certain expenses and charges, including the non-cash amortization expense resulting from the acquisition of intangible assets, as we believe these may not be indicative of the Company’s core business operating results. We intentionally include stock-based compensation expense in this measure as we believe it better captures the economic costs of our business.
Management uses this non-GAAP financial measure to understand and compare operating results across accounting periods, for internal budgeting and forecasting purposes, to evaluate financial performance, and in our comparison of our financial results to those of other companies. It is also a significant performance measure in certain of our executive incentive compensation programs.
Adjusted OI w/SBC is defined as operating income adjusted for the following: amortization of purchased intangibles, expense (income) relating to deferred compensation plan liabilities, acquisition expenses, and realignment expenses (income), for the respective periods.
Adjusted OI w/SBC margin is calculated by dividing Adjusted OI w/SBC by total revenues.
Adjusted operating income
Adjusted operating income is a non-GAAP financial measure that we believe is useful to investors in making comparisons to other companies, although this measure may not be directly comparable to similar measures used by other companies.
Adjusted operating income is defined as operating income adjusted for the following: amortization of purchased intangibles, expense (income) relating to deferred compensation plan liabilities, acquisition expenses, realignment expenses (income), and stock‑based compensation expense, for the respective periods.
Adjusted net income and Adjusted EPS
Adjusted net income and Adjusted EPS are non-GAAP financial measures presenting the earnings generated by our ongoing operations that we believe is useful to investors in making meaningful comparisons to other companies, although these measures may not be directly comparable to similar measures used by other companies, and period-over-period comparisons.
Adjusted net income is defined as net income adjusted for the following: amortization of purchased intangibles, stock‑based compensation expense, expense (income) relating to deferred compensation plan liabilities, acquisition expenses, realignment expenses (income), other non‑operating (income) expense, net, the tax effect of the above adjustments to net income, and (income) loss from investments accounted for using the equity method, net of tax, for the respective periods. 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 EPS is calculated as Adjusted net income, less net income attributable to participating securities, plus interest expense, net of tax, attributable to the convertible senior notes using the if‑converted method, if applicable, (numerator) divided by Adjusted weighted average shares, diluted (denominator). Adjusted weighted average shares, diluted is calculated by adding incremental shares related to the dilutive effect of convertible senior notes using the if‑converted method, if applicable, to weighted average shares, diluted.
Adjusted EBITDA
Adjusted EBITDA is our liquidity measure in the context of conversion of Adjusted EBITDA to cash flow from operations (i.e., the ratio of GAAP cash flow from operations to Adjusted EBITDA). We believe this non-GAAP financial measure provides a meaningful measure of liquidity and a useful basis for assessing our ability to repay debt, make strategic acquisitions and investments, and return capital to investors.
Adjusted EBITDA is defined as cash flow from operations adjusted for the following: cash interest, cash taxes, cash deferred compensation plan distributions, cash acquisition expenses, changes in operating assets and liabilities, and other cash items (such as those related to our interest rate swap). From time to time, we may exclude from Adjusted EBITDA the impact of certain cash receipts or payments that affect period-to-period comparability.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240227021083/en/
BSY Investor Contact:
Investor Relations Officer
ir@bentley.com
Source: