Implementation of IFRS 16 Leases Summary

As of January 1^st 2019, Dassault Systèmes adopted the new accounting standard IFRS 16 Leases, under the modified retrospective method. Under this method, the transition effect is accounted for within the consolidated equity at the date of initial application, therefore, there is no adjustment to prior year comparative information.

Cash Flow and Other Financial Highlights

Net operating cash flow increased 20% to €488.5 million for the 2019 first quarter compared to €406.9 million in the prior year period principally reflecting growth in net income and working capital improvement.  

Dassault Systèmes’ net financial position increased to €1.90 billion at March 31, 2019, compared to €1.81 billion at December 31, 2018, with cash, cash equivalents and short-term investments of €2.9 billion and debt related to credit lines of €1.0 billion.

Cash Dividend Recommendation, Annual Shareholders’ Meeting Date and Filing of Regulatory Annual Report

The Board of Directors has scheduled the Annual Shareholders’ Meeting for May 23, 2019 and is recommending a dividend per share equivalent to €0.65 per share for the fiscal year ended December 31, 2018, representing an increase of approximately 12% compared to the prior year €0.58 per share. Shares will be traded ex-dividend as of May 29, 2019. Dividends will be made payable on May 31, 2019. These recommendations are subject to approval by shareholders at the Annual Shareholders’ Meeting. For further information, see the Company’s 2018 Document de Référence filed with the French Autorité des Marchés Financiers (AMF) on March 26, 2019. The 2018 Document de Référence and an English language translation of this document are available on the Company’s website.

Summary of Recent Business, Technology and Customer Announcements

• BHP and Dassault Systèmes sign long-term partnership, with BHP adopting the 3DEXPERIENCE platform. Dassault Systèmes and BHP have engaged in a long-term strategic partnership to leverage the application of digital technologies to mining.  Combining the experience and resources of each company, the ambition is to unlock value by applying technologies proven in other industries to the core mining fundamentals of geoscience and resource engineering.  The partnership intends to create a new level of understanding of resource and operational potential, underpinned by both company’s commitments to safety and sustainability.
   
• On March 26, 2019, Dassault Systèmes announced that Eurostar has chosen DELMIA Quintiq applications powered by the 3DEXPERIENCE platform to optimize its resource and maintenance planning.
   
• On March 12, 2019, Dassault Systèmes announced that it will supply Alstom with its 3DEXPERIENCE platform to accelerate the delivery of 150 tailored trains to its customer, Trenitalia, the Italian national rail operator and part of Ferrovie dello Stato, introducing a new virtual product experience in the rail industry.
   
• On March 5, 2019, Dassault Systèmes announced that it had acquired the startup Argosim to leverage proven artificial intelligence technology as the backbone of model-based systems engineering and architecture for embedded systems.
   
• On February 28, 2019, ABB and Dassault Systèmes jointly announced a wide spanning global partnership to offer customers in digital industries a unique software solutions portfolio ranging from product life cycle management to asset health solutions. The companies will focus, in a staged approach, on factory automation and robotics, process industry automation, as well as electrification solutions for smart buildings.
   
• On February 11, 2019, Dassault Systèmes announced the signing of a definitive agreement to acquire the elecworks electrical and automation design software product line from Trace Software International. Through the agreement, a team of 21 skilled professionals will join Dassault Systèmes. The acquisition of the elecworks assets will streamline and boost Dassault Systèmes’ development of an integrated mechatronics solution on the 3DEXPERIENCE platform to help its SOLIDWORKS customers address electrical design challenges in the development of smart products. 
   
• On February 7, 2019, Dassault Systèmes announced that Naval Energies, a leader in marine renewables, is using the 3DEXPERIENCE platform to develop new offshore floating wind turbines and Ocean Thermal Energy Conversion (OTEC) turnkey solutions, and drive its leadership in marine renewable energies.
   
• On February 6, 2019, Airbus and Dassault Systèmes announced the signing of a five-year Memorandum of Agreement to cooperate on the implementation of collaborative 3D design, engineering, manufacturing, simulation and intelligence applications. Under the agreement, Airbus will deploy Dassault Systèmes’ 3DEXPERIENCE platform, which delivers digital continuity, from design to operations, in a single data model for a unified user experience, making digital design, manufacturing and services (DDMS) a company-wide reality for all Airbus divisions and product lines.
   
• In February, 2019 Dassault Systèmes unveiled the creation of 3DEXPERIENCE.WORKS, a new portfolio of industry-aware applications on the 3DEXPERIENCE platform that is tailored to the needs of SOLIDWORKS customers and small and midsized companies. 3DEXPERIENCE.WORKS uniquely combines social collaboration with design, simulation and manufacturing ERP capabilities in a single digital environment to help growing businesses become more inventive, efficient and responsive in today’s Industry Renaissance.
   
• On January 8, 2019, Dassault Systèmes and Cognata, Ltd. announced that they are partnering to embed Cognata’s Autonomous Vehicle Simulation Suite into Dassault Systèmes’ 3DEXPERIENCE platform. The partnership will provide a first-of-its-kind solution for autonomous vehicle makers to define, test and experience autonomous driving throughout the development cycle within the 3DEXPERIENCE platform. This will make a fully integrated autonomous vehicle development process resulting in faster, more accurate and safer autonomous vehicles on the road.

Today’s Webcast and Conference Call Information

Today, Wednesday, April 24, 2019, Dassault Systèmes will first host from London a webcasted meeting at 8:30 AM London time/9:30 AM Paris Time and will then host a conference call at 9:00 AM New York time/ 3:00 PM Paris time/ 2:00 PM London time. The webcasted meeting and conference call will be available via the Internet by accessing http://www.3ds.com/investors/. Please go to the website at least 15 minutes prior to the webcast or conference call to register, download and install any necessary software. 

Additional investor information can be accessed at http://www.3ds.com/investors/ or by calling Dassault Systèmes’ Investor Relations at 33.1.61.62.69.24.

Key Investor Relations Events

Annual Meeting of Shareholders: May 23, 2019
Second Quarter 2019 Earnings Release: July 24, 2019
Third Quarter 2019 Earnings Release: October 24, 2019
Fourth Quarter 2019 Earnings Release: February 6, 2020

Forward-looking Information

Statements herein that are not historical facts but express expectations or objectives for the future, including but not limited to statements regarding the Company’s non-IFRS financial performance objectives, are forward-looking statements.   Such forward-looking statements are based on Dassault Systèmes management's current views and assumptions and involve known and unknown risks and uncertainties. Actual results or performances may differ materially from those in such statements due to a range of factors. The Company’s current outlook for 2019 takes into consideration, among other things, an uncertain global economic environment. In light of the continuing uncertainties regarding economic, business, social and geopolitical conditions at the global level, the Company’s revenue, net earnings and cash flows may grow more slowly, whether on an annual or quarterly basis. While the Company makes every effort to take into consideration this uncertain macroeconomic outlook, the Company’s business results, however, may not develop as anticipated.  Further, there may be a substantial time lag between an improvement in global economic and business conditions and an upswing in the Company’s business results. The Company’s actual results or performance may also be materially negatively affected by numerous risks and uncertainties, as described in the “Risk Factors” section of the 2018 Document de Référence (Annual Report) filed with the AMF (French Financial Markets Authority) on March 26, 2019 and also available on the Company’s website www.3ds.com.

In preparing such forward-looking statements, the Company has in particular assumed an average US dollar to euro exchange rate of US$1.15 per €1.00 for the 2019 second quarter and US$1.20 per €1.00 for the 2019 second half as well as an average Japanese yen to euro exchange rate of JPY130 to €1.00 for the 2019 second quarter and second half before hedging; however, currency values fluctuate, and the Company’s results of operations may be significantly affected by changes in exchange rates.