After a successful 2022 financial year, Nemetschek SE has set out decisive foundations for future dynamic growth
Nemetschek has showcased revenue and profitability targets achieved in the 2022 financial year, with the annual report showing 17.7% revenue growth (currency adjusted: 12.1%) and an EBITDA margin of 32.0%.
The report also reflected on how Nemetschek’s business model transition from selling perpetual Licenses to Subscriptions & SaaS will be accelerated in 2023 – particularly through the transition initiated at the Bluebeam brand.
Although this change will generate a short-term dampening effect on revenue development and profitability and the currently changed economic environment, the Nemetschek Group expects attractive growth in 2023.
Strong acceleration of growth is expected again from 2024 onwards
“By driving the transition to Subscription-based and SaaS models this year, we are making it possible to generate significantly higher revenues per user and create a higher customer lifetime value in the medium and long term,” said Yves Padrines, CEO of the Nemetschek Group.
“In addition, these revenues are not only more predictable but also less volatile across economic cycles. This creates the conditions to benefit in the best possible way from the enormous potential of our growing markets, both in the construction and in the media business.
This is because the structural growth drivers for the Nemetschek Group – such as the low level of digitalization or the need for more efficiency and sustainability in the construction industry – aren’t just intact but are becoming increasingly important in the current environment.”
Other key findings from Nemetschek’s annual report include:
- +54.7% growth in Subscriptions & SaaS to EUR 204.2m
- +20.3% growth in earnings per share to EUR 1.40
- +27.4% ARR growth to EUR 581.7m
With an increase of 27.4% to EUR 581.7m, ARR growth was significantly above the Group’s growth, which continues to indicate high, stable growth potential for the next 12 months.
In line with the strategy, the share of recurring revenues further increased to more than 66% of the Group’s revenue (previous year: 61%).
This increase was again fueled by revenues from Subscriptions and SaaS, which grew strongly and over proportionately by around 54.7% (adjusted for currency effects: 46.8%) to EUR 204.2m.
Group revenues increased by 17.7% (adjusted for currency effects: 12.1%) compared with the previous year to EUR 801.8m. The currency-adjusted revenue growth was therefore in the forecast range of 12% to 14%.
Group earnings before interest, taxes, depreciation and amortization (EBITDA) rose by 15.8% to EUR 257.0m. At 32.0%, the EBITDA margin reached the forecast range of 32% to 33%.
Net income showed strong growth of 20.3% to EUR 161.9m, which equates to earnings per share of EUR 1.40 (2021: EUR 1.17).
Design, Build, and Media segments all showed consistent revenue growth
In the Design segment, revenue grew by 9.6% (adjusted for currency effects: 6.0%) to EUR 391.6m, despite a changing market environment, particularly in Europe, and longer sales cycles at customers. At the same time, the segment recorded strong growth in Subscription revenue by 51% (adjusted for currency effects: 43%), confirming the segment strategy of also increasingly offering Subscription models in addition to licenses. The EBITDA margin was 32.4% (previous year: 33.7%).
The Build segment achieved very strong revenue growth again despite the transition to Subscription and SaaS models by the US brand Bluebeam, which started in Q3 2022. Segment revenues increased by 24.1% (adjusted for currency effects: 14.6%) to EUR 268.3m. The EBITDA margin was 38.5% (previous year: 41.3%).
The revenue in the Media segment increased significantly by 48.5% (adjusted for currency effects: 41.2%) to EUR 104.7m. As well as strong organic growth momentum, the Media segment also benefited from the acquisition of the business operations of Pixologic, Inc. at the end of 2021. The EBITDA margin increased strongly from 36.2% in the previous year to 43.8%.
In the Manage segment, revenue increased by 6.8% (adjusted for currency effects: 7.1%) to EUR 46.7m. The EBITDA margin was 8.2% (previous year: 9.3%) partly due to increased investments.
The Executive Board and Supervisory Board propose an increase in the dividend by 15.4% to EUR 0.45 per share based on the good business development for the 2022 financial year (previous year: EUR 0.39 per share).
Strategic highlights of the Nemetschek financial year include:
- Foreign revenues increasing to 79% of the Group’s revenue, as the Group continues driving international growth, especially in the Americas and Asia/Pacific
- Expanding e-commerce and regional growth initiatives will serve existing customers and secure new groups simultaenously
- Investing in start-ups such as Sym-Terra and Kewazo, as well as streamlining and refining internal processes will best enable the Group to prosper in areas of innovation such as cloud solutions, digital twins, and artificial intelligence (AI)
The full report can be read here.
