Bentley Systems Announces First Quarter 2021 Operating Results
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Bentley Systems Announces First Quarter 2021 Operating Results

EXTON, Pa. — (BUSINESS WIRE) — May 11, 2021 — Bentley Systems, Incorporated (Nasdaq: BSY) (“Bentley Systems” or the “Company”), the infrastructure engineering software company, today announced operating results for its quarter ended March 31, 2021.

First Quarter 2021 Financial Results:

Definitions of the nonâ�‘GAAP financial measures used in this press release and reconciliations of such measures to the most comparable GAAP financial measures are included below under the heading “Use and Reconciliation of Nonâ�‘GAAP Financial Measures.”

“Our first quarter operating results were broadly consistent with the progression of the same mildly improving application usage trends we reported earlier this year, with our established quarterly seasonalization, and with the outlook we have previously expressed for the unfolding of full-year 2021. On the other hand, the quarter’s unprecedented operating margins and operating cash flows benefited from circumstances likely unique to this unusual year. Of note, we are pleased by the indicated market demand for our applications within our newly-targeted ‘SMB’ prospects— our Virtuosity subscriptions have attracted over a thousand accounts new to Bentley Systems, since inception less than a year ago,” said Greg Bentley, CEO.

“I believe the long-term potential of infrastructure digital twins will be accelerated by the ‘programmatic’ acquisitions we announced last month, of INRO to add multi-modal and dynamic simulation capabilities for mobility digital twins, and of sensemetrics and Vista Data Vision to extend our iTwin platform for infrastructure IoT. Anticipating the closing later in this quarter of our largest acquisition to date, Seequent, subject to the completion of regulatory review, when we announce our second quarter operating results we will update our financial outlook for 2021 to reflect acquisition impacts,” concluded Mr. Bentley.

First Quarter 2021 Financial Developments:

Operating Results Call Details

Bentley Systems will host a live Zoom Video Webinar on May 11, 2021 at 8:30 a.m. Eastern Time to discuss financial and operating results for its first quarter ended March 31, 2021.

Those wishing to participate should access the live Zoom Video Webinar of the event through a direct registration link at https://zoom.us/webinar/register/WN_XcHUVJklTrCeRvyQUGNxNg. Alternatively, the event can be accessed from the Events & Presentations page on Bentley Systems’ Investor Relations website at https://investors.bentley.com. Presentation materials will be posted prior to the webinar on Bentley Systems’ Investor Relations website. 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.

Definitions of Certain Key Business Metrics

Definitions of the nonâ�‘GAAP financial measures used in this earnings release and reconciliations of such measures to their nearest GAAP equivalents are included below under “Use and Reconciliation of Nonâ�‘GAAP Financial Measures.” Certain nonâ�‘GAAP measures included in our financial outlook are not being reconciled to the comparable GAAP financial measures because the GAAP measures are not accessible on a forward-looking basis. The Company is unable to reconcile these forward-looking nonâ�‘GAAP financial measures to the most directly comparable GAAP measures without unreasonable efforts because the Company is currently unable to predict with a reasonable degree of certainty the type and extent of certain items that would be expected for these periods not to impact the nonâ�‘GAAP measures, but would impact GAAP measures. Such unavailable information, which could have a significant impact on the Company’s GAAP financial results, may include stockâ�‘based compensation charges, depreciation and amortization of capitalized software costs and of acquired intangible assets, realignment expenses, and other items.

Last twelve-month recurring revenues are calculated as recurring revenues recognized over the preceding twelve-month period. We define recurring revenues as subscription 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.

Constant Currency Metrics

In reporting period-over-period results, we calculate the effects of foreign currency fluctuations and constant currency information by translating current period results using prior period average foreign currency exchange rates. Our definition of constant currency may differ from other companies reporting similarly named measures, and these constant currency performance measures should be viewed in addition to, and not as a substitute for, our operating performance measures calculated in accordance with GAAP.

Use and Reconciliation of Non-GAAP Financial Measures

In addition to our results determined in accordance with GAAP, we have calculated adjusted cost of subscriptions and licenses, adjusted cost of services, adjusted research and development, adjusted selling and marketing, adjusted general and administrative, adjusted income from operations, Adjusted Net Income, Adjusted Net Income per diluted share, Adjusted EBITDA, and Adjusted EBITDA margin, each of which are nonâ�‘GAAP financial measures. We have provided tabular reconciliations of each of these nonâ�‘GAAP financial measures to such measure’s most directly comparable GAAP financial measure.

Management uses these nonâ�‘GAAP financial measures to understand and compare operating results across accounting periods, for internal budgeting and forecasting purposes, and to evaluate financial performance and liquidity. Our nonâ�‘GAAP financial measures are presented as supplemental disclosure as we believe they provide useful information to investors and others in understanding and evaluating our results, prospects, and liquidity period-over-period without the impact of certain items that do not directly correlate to our operating performance and that may vary significantly from period to period for reasons unrelated to our operating performance, as well as to compare our financial results to those of other companies. Our definitions of these nonâ�‘GAAP financial measures may differ from similarly titled measures presented by other companies and therefore comparability may be limited. In addition, other companies may not publish these or similar metrics. Thus, our nonâ�‘GAAP financial measures should be considered in addition to, not as a substitute for, or in isolation from, the financial information prepared in accordance with GAAP, and should be read in conjunction with the financial statements included in our Quarterly Report on Form 10-Q to be filed with the U.S. Securities and Exchange Commission (“SEC”).

We calculate these non�GAAP financial measures as follows:

We encourage investors and others to review our financial information in its entirety, not to rely on any single financial measure, and to view these non�GAAP financial measures in conjunction with the related GAAP financial measures.

Forward-Looking Statements

The forward-looking statements contained in this earnings release reflect Bentley Systems’ expectations as of today’s date. Given the number of risk factors, uncertainties, and assumptions discussed below, actual results may differ materially.

Any statements made in this earnings release that are not statements of historical fact, including statements about our 2021 financial outlook and our beliefs and expectations, the planned acquisition of Seequent and the timing thereof, the impact of the acquisition on Bentley’s financial condition and results of operations and the products, services, and business relationships of each of Bentley and Seequent, are forward-looking statements and should be evaluated as such. Forward-looking statements include information concerning possible or assumed future results of operations, business plans, pending acquisitions and/or the integration of completed acquisitions, and business strategies. Forward-looking statements are based on Bentley Systems management’s beliefs, as well as assumptions made by, and information currently available to, them. Because such statements are based on expectations as to future financial and operating results and are not statements of fact, actual results may differ materially from those projected. Factors which may cause actual results to differ materially from current expectations include, but are not limited, to macroeconomic conditions, pandemic consequences, Bentley’s ability to successfully integrate or operate Seequent’s business, any costs or delays attributable to obtaining required regulatory approvals for the acquisition, costs related to the acquisition, adverse changes in the capital markets environment and Bentley’s ability to access additional financing on terms acceptable to it or at all, changes in Seequent’s customer base or geographic footprint, failure to retain personnel necessary for the operation or integration of Seequent’s business, changes in the industries in which Seequent’s customers operate, the competitive environment in which both Bentley and Seequent operate and competitive responses to the acquisition, Bentley and Seequent’s ability to innovate, develop new products or modify existing products, general economic, market, and business conditions, unanticipated impact of accounting for acquisitions, and the ability to satisfy the conditions to the completion of the acquisition on the anticipated schedule, or at all.

Further information on factors which may cause actual results to differ materially from current expectations include, but are not limited, those described under the heading “Risk Factors” in the Company’s 2020 Annual Report on Form 10-K, and the Company’s subsequent filings with the SEC. Copies of each filing may be obtained from the Company or the SEC on their respective websites. All forward-looking statements reflect our beliefs and assumptions only as of the date of this press release. We undertake no obligation to update forward-looking statements to reflect future events or circumstances.

About Bentley Systems

Bentley Systems (Nasdaq: BSY) is the infrastructure engineering software company. We provide innovative software to advance the world’s infrastructure – sustaining both the global economy and environment. Our industry-leading software solutions are used by professionals, and organizations of every size, for the design, construction, and operations of roads and bridges, rail and transit, water and wastewater, public works and utilities, buildings and campuses, and industrial facilities. Our offerings include MicroStation-based applications for modeling and simulation, ProjectWise for project delivery, AssetWise for asset and network performance, and the iTwin platform for infrastructure digital twins. Bentley Systems employs more than 4,000 colleagues and generates annual revenues of more than $800 million in 172 countries. www.bentley.com.

© 2021 Bentley Systems, Incorporated. Bentley, the Bentley logo, AssetWise, INRO, iTwin, MicroStation, ProjectWise, and Vista Data Vision are either registered or unregistered trademarks or service marks of Bentley Systems, Incorporated or one of its direct or indirect wholly owned subsidiaries. sensemetrics is a registered trademark of sensemetrics Inc. All other brands and product names are trademarks of their respective owners.

BENTLEY SYSTEMS, INCORPORATED AND SUBSIDIARIES

Consolidated Balance Sheets

(in thousands)

(unaudited)

 

March 31, 2021

December 31, 2020

Assets

 

 

 

Current assets:

Cash and cash equivalents

$

569,536

 

 

$

122,006

 

Accounts receivable

 

189,530

 

 

195,782

 

Allowance for doubtful accounts

 

(6,370

)

 

 

(5,759

)

Prepaid income taxes

 

3,994

 

 

3,535

 

Prepaid and other current assets

 

25,118

 

 

 

24,694

 

Total current assets

 

781,808

 

 

340,258

 

Property and equipment, net

 

27,767

 

 

 

28,414

 

Operating lease right-of-use assets

 

41,691

 

 

46,128

 

Intangible assets, net

 

53,697

 

 

 

45,627

 

Goodwill

 

622,756

 

 

581,174

 

Investments

 

5,245

 

 

 

5,691

 

Deferred income taxes

 

42,133

 

 

39,224

 

Other assets

 

51,771

 

 

 

39,519

 

Total assets

$

1,626,868

 

$

1,126,035

 

Liabilities and Stockholders’ Equity

 

 

 

Current liabilities:

Accounts payable

$

15,947

 

 

$

16,492

 

Accruals and other current liabilities

 

296,497

 

 

226,793

 

Deferred revenues

 

186,396

 

 

 

202,294

 

Operating lease liabilities

 

15,894

 

 

16,610

 

Income taxes payable

 

11,721

 

 

 

3,366

 

Total current liabilities

 

526,455

 

 

465,555

 

Long-term debt

 

672,599

 

 

 

246,000

 

Long-term operating lease liabilities

 

27,861

 

 

31,767

 

Deferred revenues

 

7,108

 

 

 

7,020

 

Deferred income taxes

 

14,305

 

 

10,849

 

Income taxes payable

 

7,883

 

 

 

7,883

 

Other liabilities

 

16,660

 

 

15,362

 

Total liabilities

 

1,272,871

 

 

 

784,436

 

Stockholders’ equity:

 

 

 

Common stock

 

2,737

 

 

2,722

 

Additional paid-in capital

 

732,635

 

 

 

741,113

 

Accumulated other comprehensive loss

 

(35,394

)

 

(26,233

)

Accumulated deficit

 

(345,981

)

 

 

(376,003

)

Total stockholders’ equity

 

353,997

 

 

341,599

 

Total liabilities and stockholders’ equity

$

1,626,868

 

 

$

1,126,035

 

BENTLEY SYSTEMS, INCORPORATED AND SUBSIDIARIES

Consolidated Statements of Operations

(in thousands, except share and per share data)

(unaudited)

 

Three Months Ended

March 31,

2021

 

2020

Revenues:

 

 

 

Subscriptions

$

188,125

 

$

170,182

 

Perpetual licenses

 

10,116

 

 

 

10,814

 

Subscriptions and licenses

 

198,241

 

 

180,996

 

Services

 

23,764

 

 

 

13,694

 

Total revenues

 

222,005

 

 

194,690

 

Cost of revenues:

 

 

 

Cost of subscriptions and licenses

 

28,945

 

 

21,327

 

Cost of services

 

20,344

 

 

 

15,932

 

Total cost of revenues

 

49,289

 

 

37,259

 

Gross profit

 

172,716

 

 

 

157,431

 

Operating expenses:

Research and development

 

47,803

 

 

 

45,135

 

Selling and marketing

 

32,440

 

 

36,095

 

General and administrative

 

33,388

 

 

 

26,804

 

Amortization of purchased intangibles

 

3,438

 

 

3,436

 

Total operating expenses

 

117,069

 

 

111,470

 

Income from operations

 

55,647

 

 

 

45,961

 

Interest expense, net

 

(2,319

)

 

(1,388

)

Other income (expense), net

 

14,482

 

 

 

(7,390

)

Income before income taxes

 

67,810

 

 

37,183

 

Provision for income taxes

 

(10,358

)

 

 

(7,176

)

Loss from investment accounted for using the equity method, net of tax

 

(446

)

 

(338

)

Net income

 

57,006

 

 

 

29,669

 

Less: Net income attributable to participating securities

 

 

 

 

Net income attributable to Class A and Class B common stockholders

$

57,006

 

 

$

29,669

 

Per share information:

Net income per share, basic

$

0.19

 

 

$

0.10

 

Net income per share, diluted

$

0.18

 

$

0.10

 

Weighted average shares, basic

 

302,583,452

 

 

 

285,486,972

 

Weighted average shares, diluted

 

321,736,649

 

 

292,378,627

 

BENTLEY SYSTEMS, INCORPORATED AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

 

Three Months Ended

March 31,

2021

 

2020

Cash flows from operating activities:

 

 

 

Net income

$

57,006

 

$

29,669

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

Depreciation and amortization

 

8,993

 

 

8,050

 

Bad debt allowance (recovery)

 

746

 

 

 

(256

)

Deferred income taxes

 

966

 

 

1,742

 

Deferred compensation plan activity

 

1,021

 

 

 

676

 

Stock-based compensation expense

 

8,913

 

 

1,653

 

Amortization and write-off of deferred debt issuance costs

 

1,229

 

 

 

138

 

Change in fair value of derivative

 

(13,661

)

 

 

 

Change in fair value of contingent consideration

 

 

 

(1,390

)

Foreign currency remeasurement (gain) loss

 

(583

)

 

6,985

 

Loss from investment accounted for using the equity method, net of tax

 

446

 

 

 

338

 

Changes in assets and liabilities, net of effect from acquisitions:

Accounts receivable

 

14,903

 

 

 

38,273

 

Prepaid and other assets

 

8,257

 

 

5,653

 

Accounts payable, accruals and other liabilities

 

54,977

 

 

 

6,778

 

Deferred revenues

 

(21,889

)

 

(28,247

)

Income taxes payable

 

11,474

 

 

 

2,550

 

Net cash provided by operating activities

 

132,798

 

 

72,612

 

Cash flows from investing activities:

 

 

 

Purchases of property and equipment and investment in capitalized software

 

(2,655

)

 

(4,500

)

Acquisitions, net of cash acquired of $1,326 and $1,986, respectively

 

(57,975

)

 

(39,329

)

Other investing activities

 

 

 

 

(1,414

)

Net cash used in investing activities

 

(60,630

)

 

(45,243

)

Cash flows from financing activities:

 

 

 

Proceeds from credit facilities

 

16,000

 

 

58,907

 

Payments of credit facilities

 

(262,000

)

 

 

(133,625

)

Proceeds from convertible senior notes, net of discounts and commissions

 

672,750

 

 

 

Payments of debt issuance costs

 

(3,777

)

 

 

Purchase of capped call options

 

(25,530

)

 

 

 

Payments of financing leases

 

(50

)

 

(47

)

Payments of acquisition debt and other consideration

 

(25

)

 

 

(127

)

Payments of dividends

 

(8,219

)

 

(7,802

)

Payments for shares acquired including shares withheld for taxes

 

(18,763

)

 

 

(3,918

)

Proceeds from exercise of stock options

 

1,751

 

 

 

724

 

Net cash provided by (used in) financing activities

 

372,137

 

 

(85,888

)

Effect of exchange rate changes on cash and cash equivalents

 

3,225

 

 

 

(2,293

)

Increase (decrease) in cash and cash equivalents

 

447,530

 

 

(60,812

)

Cash and cash equivalents, beginning of year

 

122,006

 

 

 

121,101

 

Cash and cash equivalents, end of period

$

569,536

 

$

60,289

 

BENTLEY SYSTEMS, INCORPORATED AND SUBSIDIARIES

Reconciliation of GAAP to Non-GAAP Measures

For the Three Months Ended March 31, 2021 and 2020

(in thousands)

(unaudited)

 

Reconciliation of net income to Adjusted EBITDA:

 

 

Three Months Ended

 

March 31,

 

2021

 

2020

Net income

$

57,006

 

 

$

29,669

 

Interest expense, net

2,319

 

 

1,388

 

Provision for income taxes

10,358

 

 

7,176

 

Depreciation and amortization

8,993

 

 

8,050

 

Stock-based compensation

8,913

 

 

1,653

 

Acquisition expenses

9,256

 

 

2,275

 

Realignment expenses

 

 

(8

)

Other (income) expense, net

(14,482

)

 

7,390

 

Loss from investment accounted for using the equity method, net of tax

446

 

 

338

 

Adjusted EBITDA

$

82,809

 

 

$

57,931

 

Reconciliation of net income to Adjusted Net Income:

 

 

Three Months Ended

 

March 31,

 

2021

 

2020

Net income

$

57,006

 

 

$

29,669

 

Non-GAAP adjustments, prior to income taxes:

 

 

 

Amortization of purchased intangibles and developed technologies

4,683

 

 

4,539

 

Stock-based compensation

8,913

 

 

1,653

 

Acquisition expenses

9,256

 

 

2,275

 

Realignment expenses

 

 

(8

)

Other (income) expense, net

(14,482

)

 

7,390

 

Total non-GAAP adjustments, prior to income taxes

8,370

 

 

15,849

 

Income tax effect of non-GAAP adjustments

(1,818

)

 

(2,700

)

Loss from investment accounted for using the equity method, net of tax

446

 

 

338

 

Adjusted Net Income

$

64,004

 

 

$

43,156

 

Reconciliation of GAAP Financial Statement Line Items to Non-GAAP Adjusted Financial Statement Line Items:

 

Three Months Ended

March 31,

2021

 

2020

Cost of subscriptions and licenses

 

$

28,945

 

 

$

21,327

 

Amortization of purchased intangibles and developed technologies

 

(1,245

)

 

(1,103

)

Stock-based compensation

 

 

(86

)

 

 

(28

)

Adjusted cost of subscriptions and licenses

 

$

27,614

 

 

$

20,196

 

 

Cost of services

 

$

20,344

 

 

$

15,932

 

Stock-based compensation

 

(235

)

 

(96

)

Acquisition expenses

 

 

(966

)

 

 

(20

)

Adjusted cost of services

 

$

19,143

 

 

$

15,816

 

 

Research and development

 

$

47,803

 

 

$

45,135

 

Stock-based compensation

 

(3,909

)

 

(619

)

Acquisition expenses

 

 

(1,374

)

 

 

(1,250

)

Realignment expenses

 

 

 

8

 

Adjusted research and development

 

$

42,520

 

 

$

43,274

 

 

Selling and marketing

 

$

32,440

 

 

$

36,095

 

Stock-based compensation

 

(690

)

 

(400

)

Acquisition expenses

 

 

(44

)

 

 

(77

)

Adjusted selling and marketing

 

$

31,706

 

 

$

35,618

 

 

General and administrative

 

$

33,388

 

 

$

26,804

 

Stock-based compensation

 

(3,993

)

 

(510

)

Acquisition expenses

 

 

(6,860

)

 

 

(812

)

Adjusted general and administrative

 

$

22,535

 

 

$

25,482

 

 

Income from operations

 

$

55,647

 

 

$

45,961

 

Amortization of purchased intangibles and developed technologies

 

4,683

 

 

4,539

 

Stock-based compensation

 

 

8,913

 

 

 

1,653

 

Acquisition expenses

 

9,256

 

 

2,275

 

Realignment expenses

 

 

 

 

 

(8

)

Adjusted income from operations

 

$

78,499

 

 

$

54,420

 

 



Contact:

Investor Contact:
Ankit Hira or Ed Yuen
Solebury Trout for Bentley Systems
ir@bentley.com
1-610-458-2777

Media Contact:
Carey Mann
carey.mann@bentley.com
1-610-458-3170