“Looking at the year, we delivered on all our financial objectives with total revenue and software revenue up 10%, license and other software revenue up 11%, organic operating margin expansion of 70 basis points absorbing almost all acquisition dilution, earnings per share up 16%, or 20% at constant currency, and cash flow from operations up 21% to €899 million.

“For 2019, we are targeting non-IFRS total revenue growth of about 10% to 11% in constant currencies and earnings per share growth of about 7% to 9% reaching €3.35 to €3.40, consistent with our expectations shared at our 2018 Capital Markets Day. We expect further progressive improvement of our organic software revenue growth, driven by recurring revenue representing 70% of our total software.

“In summary, the strategic drivers for sustainable growth we articulated at our Capital Markets Day last June, demonstrated good traction during 2018.

• Our platform strategy well addresses customer requirements to achieve true end to end digital continuity in their business and drove our 3DEXPERIENCE software higher by 24% this past year.
• With our industry solution approach, eight of our industries achieved double-digit software growth - including all of our core verticals.
• Our local focus helped drive geographic diversification and extend our overall market leadership around the globe reflected in software revenue growth of 18% for High Growth Countries.
• Finally, extension of our addressable market to $33 billion, as we expand our offer to bring the 3DEXPERIENCE platform to small and mid-sized companies.

Altogether we believe these drivers position us well for 2019, representing the completion of our current five-year plan and the start of our 2023 plan targeting €6.00 non IFRS EPS.”

The Company’s first quarter and full year 2019 financial objectives presented below are given on an IFRS 15 and IFRS 16, non-IFRS basis:

• First quarter 2019 Financial Objectives
  • 2019 non-IFRS total revenue objective of about €925 million to €945 million based upon the exchange rate assumptions below, growing about 11% to 13% in constant currencies; non-IFRS operating margin of about 31-31.5%; non-IFRS EPS of about €0.78 to €0.82, representing growth of 8% to 13%;
• Full year 2019 Financial Objectives
  • 2019 non-IFRS revenue growth objective of about 10% to 11% in constant currencies to about €3.81 to €3.84 billion; The reported revenue range reflects the principal 2019 currency exchange rate assumptions below for the US dollar and Japanese yen as well as the potential impact from additional currencies representing about 18% of the Company’s total revenue in 2018.
  • 2019 non-IFRS operating margin of about 32 to 32.5%;
  • 2019 non-IFRS EPS of about €3.35 to 3.40, representing a growth objective of about 7% to 9% as reported;
• Financial objectives are based upon first quarter exchange rate assumptions of US$1.16 per €1.00 and US$1.19 per €1.00 for the full year; and JPY130 per €1.00 before hedging for both the first quarter and full year.

These objectives are prepared and communicated only on a non-IFRS basis and are subject to the cautionary statement set forth below.

The 2019 non-IFRS objectives set forth above do not take into account the following accounting elements and are estimated based upon the 2019 principal currency exchange rates above: contract liabilities write-downs estimated at approximately €6 million; share-based compensation expense, including related social charges, estimated at approximately €105 million and amortization of acquired intangibles estimated at approximately €177 million. The above objectives also do not include any impact from other operating income and expense, net principally comprised of acquisition, integration and restructuring expenses, and impairment of goodwill and acquired intangible assets; from one-time items included in financial revenue; from one-time tax effects; and from the income tax effects of these non-IFRS adjustments. Finally, these estimates do not include any new stock option or share grants, or any new acquisitions or restructurings completed after February 6, 2019.