December 13, 2012 at 16:10 PM EST
ESI Group: Revenues for the 3rd Quarter and First 9 Months of 2012/13

Regulatory News:

Alain de Rouvray, ESI Group’s (Paris:ESI) Chairman and CEO, comments:

Over our third quarter, the Group reaffirmed its ability to deliver substantial revenue momentum across its entire scope, which bears witness to the growing success of our virtual prototyping solutions and the relevance of the strategic choices made in regard to our acquisitions. This performance was achieved in a balanced manner between the various sectors and geographical zones, with a high rate of Repeat Business. The buoyant revenues growth over the first three quarters of our financial year affirms our conviction that we will be in line with our multi-year development plan.

3rd quarter and 9-month revenues

The Group’s FY ends on January 31st

In € millions

Q3
2012/13

Q3
2011/12

Δ %
(euros)

Δ %
(cer**)

9 months
2012/13*

9 months
2011/12

Δ %
(euros)

Δ %
(cer**)

Licenses

14.2 11.5 +23.4% +18.6% 44.3 36.4 +21.7% +16.2%
Services 7.7 6.1 +26.9% +22.5% 22.3 17.8 +25.6% +20.5%
Total21.917.6+24.6% +20.0% 66.754.2+23.0% +17.6%

* Sales exclude purchase/resale operations of €0.7 million. 2012/13 revenues include activity recorded by IC.IDO, consolidated from August 24, 2011, and Efield, consolidated from December 9, 2011.

** cer: constant exchange rate

Breakdown of quarterly revenues

The Group’s FY ends on January 31st

In € millions

Q3
2012/13*

Q2
2012/13

Q1
2012/13

Q3
2011/12

Q2
2011/12

Q1
2011/12

Licenses

14.2 15.8 14.4 11.5 13.3 11.6
Services 7.7 7.8 6.8 6.1 6.0 5.7
Total21.923.521.217.619.317.3

Reminder: the seasonal nature of ESI Group's License revenues usually has the consequence that a larger proportion of full-year revenues is recorded over the fourth quarter of the year.

* The 3rd quarter of 2012/13 now incorporates the consolidation of IC.IDO’s activity within the Group’s organic scope. The scope associated with external growth incorporates the OpenCFD and Efield activities.

3rd quarter sales

Revenues for the 3rd quarter of 2012/13 totaled 21.9 million euros; in actual terms up +24.5% on the 3rd quarter of last year. This quarter includes 0.4 million euros in revenues resulting from the consolidation of the Efield and OpenCFD activities, as these two acquisitions were announced on December 13, 2011 and September 12, 2012 respectively. The impact of these acquisitions being limited, the buoyant growth recorded by the Group was therefore mainly organic. At constant scope (excluding the acquisitions), revenues totaled 21.5 million euros over the 3rd quarter of 2012/13; an increase of +22.4% (+17.7% at constant exchange rates).

The product mix was stable relative to the same quarter of the previous year. Licenses revenues, which totaled 14.2 million euros and increased +23.4% in actual terms; represented 64.7% of total revenues, versus 65.3% for the same quarter last year.

All of the Group’s key indicators were positive. Repeat Business remained high at 82.9%, yielding substantial growth of +18.2% in actual terms. New Business represented 29.4% of Licenses revenues, recording a growth of +15.2%. This dynamism, inherent to the activity generated by new products and/or new accounts, bears witness to the sales synergies derived from the recent acquisitions.

Regarding Services activity, revenues were up +26.9% in actual terms and totaled 7.7 million euros, reflecting industry’s need for support within the framework of deployment of innovative, high value added projects that require the implementation of virtual prototyping solutions. At constant scope, revenue growth was +20.6% (+16.2% at constant exchange rates).

The evolution in the geographical split in revenues never-the-less reflects balanced growth across all of the Group’s geographical zones. Europe, Asia and the Americas accounted for 38.4%, 41.0% and 20.6% of sales respectively, compared with 40.0%, 39.3% and 20.7% over the 3rd quarter of last year. A fine performance recorded in Licenses activity in Asia should be noted, with this segment achieving organic growth of +25.6% at constant exchange rates thanks to the signing of important contracts in Japan and China in the Automotive sector.

9-month sales

Over the first 9 months of 2012/13, the Group recorded revenues of 66.7 million euros, up +23.0% in actual terms, +18.1% in organic terms, and +12.7% at constant exchange rates.

Licenses activity grew by +21.7% in actual terms (+17.2% in organic terms) to 44.3 million euros and accounted for 66.5% of total Group revenues over the first 9 months of 2012/13.

The Installed Base recorded buoyant growth of +21.1% in actual terms, totaling 30.3 million euros. The rate of Repeat Business remained very high at 89%. New Business recorded solid growth of +12.6% at 10.1 million euros, and thus accounted for 25.1% of total Licenses revenues.

Services activity also recorded buoyant growth, increasing by +25.6% in actual terms (+19.9% in organic terms) to 22.3 million euros.

In terms of the geographical split, activity recorded significant growth in Europe (+23.1%), especially License sales. The development of ESI Group’s activity in Asia also continued at a buoyant rate (+21.9% in actual terms), with a substantial acceleration in the organic growth of the Services segment (+40.1%). Strong and balanced growth (+25.1% in actual terms) was also recorded in the Americas.

By sector, the first 9 months of the year saw an improvement in orders booked from sectors facing substantial competitive pressure and increasingly stringent regulations: Transportation (including Automotive) recorded an increase of +15% (accounting for 51% of booking), Aeronautical and Space +35% (13% of booking) and Heavy Industry +10% (16% of booking).

About ESI

ESI is a pioneer and world-leading player in virtual prototyping that take into account the physics of materials. ESI has developed an extensive suite of coherent, industry-oriented applications to realistically simulate a product’s behaviour during testing, to fine-tune manufacturing processes in accordance with desired product performance, and to evaluate the environment’s impact on product performance. This offer represents a unique collaborative and open environment for Simulation-Based Design, enabling virtual prototypes to be improved in a continuous and collaborative manner while eliminating the need for physical prototypes during product development. Present in over 30 countries, ESI employs some 900 high-level specialists throughout its worldwide network. ESI Group is listed on compartment C of NYSE Euronext Paris.

For further information, go to www.esi-group.com.

ESI is on Twitter, Facebook and YouTube

ESI is the leader and a pioneer in virtual prototyping solutions.

Stock market information
Listed on compartment C of the NYSE Euronext Paris
ISIN FR 0004110310
FTSE 977
Bloomberg ESI FP
Reuters ESIG.LN

Granted entreprise innovante(innovative company) certification on January 20, 2000 by OSEO, ESI Group is eligible for inclusion in FCPI (venture capital trusts dedicated to innovation

Financial schedule
Press release
2012/13 annual sales
March 14, 2013
(after market)

Our Press Section can be found at www.esi-group.com

Contacts:

ESI Group
Corinne Romefort-Régnier, +33 (0)1 53 65 14 14
investors@esi-group.com
or
NewCap.
Louis-Victor Delouvrier / Axelle Vuillermet, +33 (0)1 44 71 98 53
esi@newcap.fr
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