Bentley Systems, Incorporated, the infrastructure engineering software company, announced operating results for its second quarter and six months ended June 30, 2023.
Second Quarter 2023 Operating Results
- Total revenues were $296.7 million, up 10.6% or 10.1% on a constant currency basis, year-over-year;
- Subscriptions revenues were $259.2 million, up 11.7% or 10.9% on a constant currency basis, year-over-year;
- Annualized Recurring Revenues (“ARR”) was $1,105.9 million as of June 30, 2023, compared to $971.9 million as of June 30, 2022, representing a constant currency ARR growth rate of 13%;
- Last twelve-month recurring revenues dollar-based net retention rate was 110%, compared to 109% for the same period last year;
- Operating income margin was 18.0%, compared to 20.8% for the same period last year;
- Adjusted operating income inclusive of stock-based compensation expense (“Adjusted OI w/SBC”) margin was 24.7%, compared to 24.0% for the same period last year;
- Net income per diluted share was $0.15, compared to $0.17 for the same period last year;
- Adjusted net income per diluted share (“Adjusted EPS”) was $0.24, compared to $0.23 for the same period last year; and
- Cash flow from operations was $80.6 million, compared to $67.0 million for the same period last year.
Six Months Ended June 30, 2023 Operating Results
- Total revenues were $611.2 million, up 12.4% or 13.6% on a constant currency basis, year-over-year;
- Subscriptions revenues were $537.1 million, up 13.4% or 14.5% on a constant currency basis, year-over-year;
- Operating income margin was 19.5%, compared to 20.7% for the same period last year;
- Adjusted OI w/SBC margin was 26.8%, compared to 26.2% for the same period last year;
- Net income per diluted share was $0.29, compared to $0.35 for the same period last year;
- Adjusted EPS was $0.49, compared to $0.47 for the same period last year; and
- Cash flow from operations was $256.8 million, compared to $168.7 million for the same period last year.
CEO Greg Bentley said, “I am pleased to again report strong operating results this quarter, driven perhaps equally by 2023’s favorable end market conditions and by our teams’ strong operational execution. We are sustaining robust ARR growth of 13% (year-over-year constant currency business performance) with directionally broader balance across the board. Our E365 growth initiative for enterprise accounts, and our Virtuosity growth initiative for SMB accounts and prospects, are each contributing at continuously greater levels.
“We are narrowing our 2023 ARR growth outlook (constant currency business performance) to a range of 12% to 13% by virtue of the momentum underlying our strong first half, offset by lower expectations for programmatic acquisition contributions this year, and particularly by the business model shift in China (from ARR) due to prevailing geopolitical concerns.”
COO Nicholas Cumins commented, “Our 23Q2 operating results reflect our strong performance across the board. ARR growth by region was led by continued very solid growth in North America and Asia-Pacific and steady growth in Europe. By sector, growth in Public Works / Utilities remained strong while growth in Industrial improved, offset somewhat by growth in Resources normalizing from record levels and continued softness in Commercial / Facilities. We believe we are strongly positioned to benefit from the long-term investments in civil infrastructure globally, and the increasing priority our accounts are placing on going digital.”
CFO Werner Andre said, “In 23Q2 BSY delivered financial results that met or surpassed our expectations in all key metrics, including ARR growth, revenues, recurring revenues dollar-based net retention rate, Adjusted operating income inclusive of stock-based compensation expense margin, and operating cash flows. Although we have narrowed our range of expectations for the year’s ARR growth (constant currency business performance), we are maintaining our financial outlook for the other metrics.
“Along with relatively light acquisition and investment expenditures, during the first half of 2023 we paid $29 million in dividends, effectively repurchased $51 million of shares to offset dilution from stock-based compensation, and repaid $147 million of net bank borrowings.”
Operating Results Call Details
Bentley Systems will host a live Zoom video webinar on August 8, 2023 at 8:15 a.m. Eastern time to discuss operating results for its second quarter ended June 30, 2023.
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_vGAVc0NyRy-CbB4PTe33Gg#/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.
