Bentley Systems Announces First Quarter 2024 Results

Rhea-AI Summary

Bentley Systems, Incorporated reported positive financial results for the first quarter of 2024, with total revenues of $337.8 million, a 7.4% increase year-over-year. Subscriptions revenues were up by 10.5%, reaching $307.1 million. The company's Annualized Recurring Revenues (ARR) grew by 11% to $1,186.5 million. Operating income margin improved to 27.2%, and adjusted operating income margin increased to 33.3%. Net income per diluted share rose to $0.22, while adjusted net income per diluted share was $0.31. Cash flows from operations also saw a significant increase to $205.0 million.

Positive

• Total revenues increased by 7.4% year-over-year, reaching $337.8 million.

• Subscriptions revenues grew by 10.5% to $307.1 million.

• Annualized Recurring Revenues (ARR) increased by 11% to $1,186.5 million.

• Operating income margin improved to 27.2%, and adjusted operating income margin rose to 33.3%.

• Net income per diluted share increased to $0.22, and adjusted net income per diluted share was $0.31.

• Cash flows from operations saw a significant increase to $205.0 million.

Negative

• None.

Insights

Financial Analyst

Bentley Systems' first quarter financials highlight a strong start to 2024, indicative of the company's resilient subscription-based revenue model and operational efficiency. Revenue growth of 7.4% year-over-year, primarily driven by a 10.5% rise in subscription revenue, underscores the robust demand for Bentley's infrastructure engineering software. A key metric, Annualized Recurring Revenues (ARR), grew by 11%, suggesting a solidified customer base and a predictable revenue stream which is a positive signal for sustained growth.

Another compelling factor is the improved operating income margin, which expanded from 20.9% to 27.2%, likely reflecting effective cost management. Adjusted Operating Income with stock-based compensation also saw a substantial rise to 33.3% margin, pointing towards an even stronger underlying financial performance. The net income per diluted share increased from $0.14 to $0.22 and the adjusted EPS from $0.25 to $0.31, both of which are indicators of profitability that are important to investors.

From a liquidity standpoint, the operational cash flow increment to $205.0 million from $176.2 million provides Bentley Systems with financial flexibility for strategic initiatives such as share repurchases, dividends and M&A activities, while also reducing leverage, as highlighted by the CFO's comments on deleveraging by 0.5 times Adjusted EBITDA in the quarter. However, it's important for investors to be mindful of the professional services segment downturn, as it may indicate sector-specific challenges or a shift in business strategy.

Market Research Analyst

The notable increase in Bentley Systems' ARR, particularly excluding China, is indicative of the company's global market reach and its resilience against geopolitical risks. The specialization in Public Works / Utilities and Resources sectors, which are showing strong and solid growth respectively, aligns well with global trends towards infrastructure development and digitalization. This alignment is central to understanding the potential for Bentley's infrastructure digital twins technology to serve as a growth catalyst in a market where digital solutions are increasingly critical for efficiency and sustainability in infrastructure projects.

The company’s strategic focus on addressing the engineering resource gap can also be viewed as a competitive advantage, as COO Nicholas Cumins suggested, with the transition to new leadership potentially bringing fresh momentum to capitalize on this opportunity. In the longer term, investors should watch for the company’s ability to maintain growth in the face of potential macroeconomic shifts and continuing technology disruption in the sector.

Technology Analyst

The consistent growth in Bentley's Annualized Recurring Revenues (ARR) reaffirms the scalability of their subscription-based business model, a mainstay in the software industry. The reported increase in operating margins and net income reflects not only the company's operational efficiencies but also the high-margin nature of software revenues, particularly subscriptions.

Bentley Systems' infrastructure digital twins represent a significant technological advancement in the engineering software market. Digital twins are complex simulations that allow for real-time monitoring and predictive maintenance of infrastructure, potentially revolutionizing the sector. The long-term implications of this technology for Bentley’s growth could be substantial as infrastructure globally becomes more connected and intelligent.

However, one must critically assess the decline in the professional services business. As software becomes more capable and automated, there could be a reduced need for such services, or this could signal an internal shift to focus on more profitable, scalable software solutions.

EXTON, Pa.--(BUSINESS WIRE)-- Bentley Systems, Incorporated (Nasdaq: BSY), the infrastructure engineering software company, today announced results for its first quarter ended March 31, 2024.

First Quarter 2024 Results

• Total revenues were $337.8 million, up 7.4% or 7.2% on a constant currency basis, year-over-year;
• Subscriptions revenues were $307.1 million, up 10.5% or 10.3% on a constant currency basis, year-over-year;
• Annualized Recurring Revenues (“ARR”) was $1,186.5 million as of March 31, 2024, compared to $1,071.0 million as of March 31, 2023, representing a constant currency ARR growth rate of 11%;
• Last twelve-month recurring revenues dollar-based net retention rate was 108%, compared to 110% for the same period last year;
• Operating income margin was 27.2%, compared to 20.9% for the same period last year;
• Adjusted operating income inclusive of stock-based compensation expense (“Adjusted OI w/SBC”) margin was 33.3%, compared to 28.8% for the same period last year;
• Net income per diluted share was $0.22, compared to $0.14 for the same period last year;
• Adjusted net income per diluted share (“Adjusted EPS”) was $0.31, compared to $0.25 for the same period last year; and
• Cash flows from operations was $205.0 million, compared to $176.2 million for the same period last year.

CEO Greg Bentley said, “We are pleased with our 24Q1 performance, as year-over-year ARR growth of 11% (excluding China, 11.5%) is consistent with our recent financial outlook range for 2024. Profitability and operating cash flow started the year ahead of our expected pace, with subscription revenues (91% of total) fully on pace, although our digital integrator Cohesive’s professional services business unrelated to Bentley Systems software has declined significantly from 2023.

“Coinciding with our 40th anniversary observance, on March 21st in London we announced that COO Nicholas Cumins will succeed me as CEO on July 1st, as I take up the new role of Executive Chair. Through this generational transition we can perpetuate our characteristic steadiness, while cognizant that unprecedented opportunities presented by infrastructure digital twins could springboard, for Bentley Systems, transformative growth.”

COO Nicholas Cumins said, “I again thank the Board of Directors for entrusting me with the responsibility of following in Greg’s footsteps as CEO. With our singular focus on helping users improve infrastructure delivery and performance, Bentley is well positioned to address the infrastructure sectors’ biggest challenges, including the widening gap in engineering resource capacity. Our 24Q1 results are consistent with the trends we have seen in previous quarters, led by strong growth in Public Works / Utilities, and solid growth in Resources.”

CFO Werner Andre said, “We are pleased with the strong start to the year, which puts us in a good position to achieve our full-year outlook. Our strong 24Q1 operating margin and cash flow performance enabled us to de-lever by 0.5 times Adjusted EBITDA in the quarter, and by 1.7 times since the beginning of 2023. With all remaining debt protected from high or rising interest rates through very low fixed coupons on our convertible notes and our interest rate swap, we are well positioned to maintain our dividend, share repurchases, and programmatic M&A readiness.”

Call Details

Bentley Systems will host a live Zoom video webinar on May 7, 2024 at 8:15 a.m. Eastern time to discuss results for its first quarter ended March 31, 2024.

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_uHLOUkDdTKm5dDkkZl4lyg#/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.

Non-GAAP Financial Measures

In this press release, we sometimes refer to financial measures that are not presented in accordance with U.S. generally accepted accounting principles (“GAAP”). Certain of these measures are considered non-GAAP financial measures under the United States Securities and Exchange Commission (“SEC”) regulations. Those rules require the supplemental explanations and reconciliations that are in Bentley Systems’ Form 8-K (Quarterly Earnings Release) furnished to the SEC.

Forward-Looking Statements

This press release includes forward-looking statements regarding the future results of operations and financial condition, business strategy, and plans and objectives for future operations of Bentley Systems, Incorporated (the “Company,” “we,” “us,” and words of similar import). All such statements contained in this press release, other than statements of historical facts, are forward-looking statements. The words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” and similar expressions are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations, projections, and assumptions about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives, and financial needs. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, and there are a significant number of factors that could cause actual results to differ materially from statements made in this press release including: adverse changes in global economic and/or political conditions; the impact of current and future sanctions, embargoes and other similar laws at the state and/or federal level that impose restrictions on our counterparties or upon our ability to operate our business within the subject jurisdictions; political, economic, regulatory and public health and safety risks and uncertainties in the countries and regions in which we operate; failure to retain personnel necessary for the operation of our business or those that we acquire; failure to effectively manage succession; changes in the industries in which our accounts operate; the competitive environment in which we operate; the quality of our products; our ability to develop and market new products to address our accounts’ rapidly changing technological needs; changes in capital markets and our ability to access financing on terms satisfactory to us or at all; the impact of changing or uncertain interest rates on us and on the industries we serve; our ability to integrate acquired businesses successfully; and our ability to identify and consummate future investments and/or acquisitions on terms satisfactory to us or at all.

Further information on potential factors that could affect the financial results of the Company are included in the Company’s Form 10‑K and subsequent Form 10‑Qs, which are on file with the SEC. The Company disclaims any obligation to update the forward-looking statements provided to reflect events that occur or circumstances that exist after the date on which they were made.

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, mining, and industrial facilities. Our offerings, powered by the iTwin Platform for infrastructure digital twins, include MicroStation and Bentley Open applications for modeling and simulation, Seequent’s software for geoprofessionals, and Bentley Infrastructure Cloud encompassing ProjectWise for project delivery, SYNCHRO for construction management, and AssetWise for asset operations. Bentley Systems’ 5,200 colleagues generate annual revenues of more than $1 billion in 194 countries.

www.bentley.com

© 2024 Bentley Systems, Incorporated. Bentley, the Bentley logo, AssetWise, Bentley Infrastructure Cloud, Bentley Open, Cohesive, iTwin, MicroStation, ProjectWise, Seequent, and SYNCHRO are either registered or unregistered trademarks or service marks of Bentley Systems, Incorporated or one of its direct or indirect wholly owned subsidiaries. All other brands and product names are trademarks of their respective owners.

BENTLEY SYSTEMS, INCORPORATED Consolidated Balance Sheets (in thousands) (unaudited)
		March 31, 2024				December 31, 2023
Assets
Current assets:
Cash and cash equivalents		$	141,601			$	68,412
Accounts receivable			284,200				302,501
Allowance for doubtful accounts			(9,723	)			(8,965	)
Prepaid income taxes			10,891				12,812
Prepaid and other current assets			46,716				44,797
Total current assets			473,685				419,557
Property and equipment, net			38,563				40,100
Operating lease right-of-use assets			36,454				38,476
Intangible assets, net			236,402				248,787
Goodwill			2,261,190				2,269,336
Investments			23,641				23,480
Deferred income taxes			208,152				212,831
Other assets			75,681				67,283
Total assets		$	3,353,768			$	3,319,850
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable		$	23,568			$	18,094
Accruals and other current liabilities			539,775				457,348
Deferred revenues			242,037				253,785
Operating lease liabilities			11,178				11,645
Income taxes payable			11,275				9,491
Current portion of long-term debt			10,000				10,000
Total current liabilities			837,833				760,363
Long-term debt			1,425,445				1,518,403
Deferred compensation plan liabilities			93,402				88,181
Long-term operating lease liabilities			28,812				30,626
Deferred revenues			15,206				15,862
Deferred income taxes			10,391				9,718
Income taxes payable			7,337				7,337
Other liabilities			2,735				5,378
Total liabilities			2,421,161				2,435,868
Stockholders’ equity:
Common stock			2,980				2,963
Additional paid-in capital			1,154,137				1,127,234
Accumulated other comprehensive loss			(92,619	)			(84,987	)
Accumulated deficit			(132,595	)			(161,932	)
Non-controlling interest			704				704
Total stockholders’ equity			932,607				883,982
Total liabilities and stockholders’ equity		$	3,353,768			$	3,319,850

BENTLEY SYSTEMS, INCORPORATED Consolidated Statements of Operations (in thousands, except share and per share data) (unaudited)
		Three Months Ended
		March 31,
			2024				2023
Revenues:
Subscriptions		$	307,089			$	277,845
Perpetual licenses			9,512				9,547
Subscriptions and licenses			316,601				287,392
Services			21,162				27,019
Total revenues			337,763				314,411
Cost of revenues:
Cost of subscriptions and licenses			40,218				40,931
Cost of services			21,612				26,253
Total cost of revenues			61,830				67,184
Gross profit			275,933				247,227
Operating expenses:
Research and development			68,371				67,800
Selling and marketing			54,386				52,141
General and administrative			46,482				46,807
Deferred compensation plan			5,799				4,146
Amortization of purchased intangibles			8,964				10,548
Total operating expenses			184,002				181,442
Income from operations			91,931				65,785
Interest expense, net			(6,520	)			(11,092	)
Other income, net			7,137				289
Income before income taxes			92,548				54,982
Provision for income taxes			(22,247	)			(9,492	)
Equity in net income of investees, net of tax			9				—
Net income		$	70,310			$	45,490
Per share information:
Net income per share, basic		$	0.22			$	0.15
Net income per share, diluted		$	0.22			$	0.14
Weighted average shares, basic			314,295,102				310,758,802
Weighted average shares, diluted			333,623,518				331,251,884

BENTLEY SYSTEMS, INCORPORATED Consolidated Statements of Cash Flows (in thousands) (unaudited)
		Three Months Ended
		March 31,
			2024				2023
Cash flows from operating activities:
Net income		$	70,310			$	45,490
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			16,385				18,057
Deferred income taxes			5,302				(4,178	)
Stock-based compensation expense			19,658				19,484
Deferred compensation plan			5,799				4,146
Amortization of deferred debt issuance costs			1,823				1,823
Change in fair value of derivative			(2,790	)			4,489
Foreign currency remeasurement (gain) loss			(1,744	)			1,018
Other			1,099				(4,411	)
Changes in assets and liabilities, net of effect from acquisitions:
Accounts receivable			14,508				15,420
Prepaid and other assets			(5,321	)			12,137
Accounts payable, accruals, and other liabilities			85,071				53,127
Deferred revenues			(9,257	)			1,942
Income taxes payable, net of prepaid income taxes			4,126				7,679
Net cash provided by operating activities			204,969				176,223
Cash flows from investing activities:
Purchases of property and equipment and investment in capitalized software			(3,599	)			(4,284	)
Acquisitions, net of cash acquired			—				(10,299	)
Purchases of investments			(250	)			(6,178	)
Net cash used in investing activities			(3,849	)			(20,761	)
Cash flows from financing activities:
Proceeds from credit facilities			39,838				117,139
Payments of credit facilities			(131,866	)			(223,124	)
Repayments of term loan			(2,500	)			(1,250	)
Payments of contingent and non-contingent consideration			(451	)			(249	)
Payments of dividends			(17,871	)			(14,522	)
Proceeds from stock purchases under employee stock purchase plan			5,560				4,557
Proceeds from exercise of stock options			4,007				4,202
Payments for shares acquired including shares withheld for taxes			(8,099	)			(20,948	)
Repurchases of Class B common stock under approved program			(15,006	)			—
Other			(47	)			(46	)
Net cash used in financing activities			(126,435	)			(134,241	)
Effect of exchange rate changes on cash and cash equivalents			(1,496	)			662
Increase in cash and cash equivalents			73,189				21,883
Cash and cash equivalents, beginning of year			68,412				71,684
Cash and cash equivalents, end of period		$	141,601			$	93,567

BENTLEY SYSTEMS, INCORPORATED
Reconciliation of GAAP to Non-GAAP Financial Measures
(in thousands, except share and per share data)
(unaudited)
Reconciliation of operating income to Adjusted OI w/SBC and to Adjusted operating income:
		Three Months Ended
		March 31,
		2024				2023
Operating income		$	91,931			$	65,785
Amortization of purchased intangibles			12,190				13,735
Deferred compensation plan			5,799				4,146
Acquisition expenses			2,359				8,777
Realignment expenses (income)			66				(1,979	)
Adjusted OI w/SBC			112,345				90,464
Stock-based compensation expense			19,337				19,198
Adjusted operating income		$	131,682			$	109,662

Reconciliation of net income to Adjusted net income:
		Three Months Ended
		March 31,
		2024								2023
		$				EPS(1)				$				EPS(1)
Net income		$	70,310			$	0.22			$	45,490			$	0.14
Non-GAAP adjustments, prior to income taxes:
Amortization of purchased intangibles			12,190				0.04				13,735				0.04
Stock-based compensation expense			19,337				0.06				19,198				0.06
Deferred compensation plan			5,799				0.02				4,146				0.01
Acquisition expenses			2,359				0.01				8,777				0.03
Realignment expenses (income)			66				—				(1,979	)			(0.01	)
Other income, net			(7,137	)			(0.02	)			(289	)			—
Total non-GAAP adjustments, prior to income taxes			32,614				0.10				43,588				0.13
Income tax effect of non-GAAP adjustments			—				—				(7,389	)			(0.02	)
Equity in net income of investees, net of tax			(9	)			—				—				—
Adjusted net income(2)		$	102,915			$	0.31			$	81,689			$	0.25
Adjusted weighted average shares, diluted		333,623,518								331,251,884

____________________
(1)		Adjusted EPS was computed independently for each reconciling item presented; therefore, the sum of Adjusted EPS for each line item may not equal total Adjusted EPS due to rounding.
(2)		Adjusted EPS numerator includes $1,723 and $1,717 for the three months ended March 31, 2024 and 2023, respectively, related to interest expense, net of tax, attributable to the convertible senior notes using the if‑converted method.

Reconciliation of cash flow from operations to Adjusted EBITDA:
		Three Months Ended
		March 31,
			2024				2023
Cash flow from operations		$	204,969			$	176,223
Cash interest			5,257				10,473
Cash taxes			11,543				6,033
Cash deferred compensation plan distributions			473				421
Cash acquisition expenses			1,807				11,053
Cash realignment costs			7,517				—
Changes in operating assets and liabilities			(93,332	)			(88,299	)
Other(1)			(2,357	)			(1,920	)
Adjusted EBITDA		$	135,877			$	113,984

____________________
(1)		Includes receipts related to interest rate swap.

Reconciliation of total revenues and subscriptions revenues to total revenues and subscriptions revenues in constant currency:
		Three Months Ended March 31, 2024										Three Months Ended March 31, 2023
		Actual			Impact of Foreign Exchange at 2023 Rates				Constant Currency			Actual			Impact of Foreign Exchange at 2023 Rates				Constant Currency
Total revenues		$	337,763		$	(843	)		$	336,920		$	314,411		$	(125	)		$	314,286
Subscriptions revenues		$	307,089		$	(761	)		$	306,328		$	277,845		$	(142	)		$	277,703

Explanation of Non-GAAP and Other Financial Measures

Constant currency

Constant currency and constant currency growth rates are non-GAAP financial measures that present our results of operations excluding the estimated effects of foreign currency exchange rate fluctuations. A significant amount of our operations is conducted in foreign currencies. As a result, the comparability of the financial results reported in U.S. dollars is affected by changes in foreign currency exchange rates. We use constant currency and constant currency growth rates to evaluate the underlying performance of the business, and we believe it is helpful for investors to present operating results on a comparable basis period over period to evaluate its underlying performance.

In reporting period‑over‑period results, except for ARR as discussed further below, we calculate the effects of foreign currency fluctuations and constant currency information by translating current and prior period results on a transactional basis to our reporting currency using prior period average foreign currency exchange rates in which the transactions occurred.

Recurring revenues

Recurring revenues are the basis for our other revenue-related key business metrics. We believe this measure is useful in evaluating our ability to consistently retain and grow our revenues from accounts with revenues in the prior period (“existing accounts”).

Recurring revenues are subscriptions 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.

Annualized recurring revenues (“ARR”)

ARR is a key business metric that we believe is useful in evaluating the scale and growth of our business as well as to assist in the evaluation of underlying trends in our business. Furthermore, we believe ARR, considered in connection with our last twelve‑month recurring revenues dollar‑based net retention rate, is a leading indicator of revenue growth.

ARR is defined as the sum of the annualized value of our portfolio of contracts that produce recurring revenues as of the last day of the reporting period, and the annualized value of the last three months of recognized revenues for our contractually recurring consumption‑based software subscriptions with consumption measurement durations of less than one year, calculated using the spot foreign currency exchange rates. We believe that the last three months of recognized revenues, on an annualized basis, for our recurring software subscriptions with consumption measurement period durations of less than one year is a reasonable estimate of the annual revenues, given our consistently high retention rate and stability of usage under such subscriptions.

Constant currency ARR growth rate is the growth rate of ARR measured on a constant currency basis. In reporting period‑over‑period ARR growth rates in constant currency, we calculate constant currency growth rates by translating current and prior period ARR on a transactional basis to our reporting currency using current year budget exchange rates. Constant currency ARR growth rate from business performance excludes the ARR onboarding of our platform acquisitions and includes the impact from the ARR onboarding of programmatic acquisitions, which generally are immaterial, individually and in the aggregate. We believe these ARR growth rates are important metrics indicating the scale and growth of our business.

Last twelve‑month recurring revenues dollar‑based net retention rate

Last twelve‑month recurring revenues dollar‑based net retention rate is a key business metric that we believe is useful in evaluating our ability to consistently retain and grow our recurring revenues.

Last twelve‑month recurring revenues dollar‑based net retention rate is calculated, using the average exchange rates for the prior period, as follows: the recurring revenues for the current period, including any growth or reductions from existing accounts, but excluding recurring revenues from any new accounts added during the current period, divided by the total recurring revenues from all accounts during the prior period. A period is defined as any trailing twelve months. Related to our platform acquisitions, recurring revenues into new accounts will be captured as existing accounts starting with the second anniversary of the acquisition when such data conforms to the calculation methodology. This may cause variability in the comparison.

Adjusted operating income inclusive of stock-based compensation expense (“Adjusted OI w/SBC”)

Adjusted OI w/SBC is a non-GAAP financial measure and is used to measure the operational strength and performance of our business, as well as to assist in the evaluation of underlying trends in our business.

Adjusted OI w/SBC is our primary performance measure, which excludes certain expenses and charges, including the non-cash amortization expense resulting from the acquisition of intangible assets, as we believe these may not be indicative of the Company’s core business operating results. We intentionally include stock-based compensation expense in this measure as we believe it better captures the economic costs of our business.

Management uses this non-GAAP financial measure to understand and compare operating results across accounting periods, for internal budgeting and forecasting purposes, to evaluate financial performance, and in our comparison of our financial results to those of other companies. It is also a significant performance measure in certain of our executive incentive compensation programs.

Adjusted OI w/SBC is defined as operating income adjusted for the following: amortization of purchased intangibles, expense (income) relating to deferred compensation plan liabilities, acquisition expenses, and realignment expenses (income), for the respective periods.

Adjusted OI w/SBC margin is calculated by dividing Adjusted OI w/SBC by total revenues.

Adjusted operating income

Adjusted operating income is a non-GAAP financial measure that we believe is useful to investors in making comparisons to other companies, although this measure may not be directly comparable to similar measures used by other companies.

Adjusted operating income is defined as operating income adjusted for the following: amortization of purchased intangibles, expense (income) relating to deferred compensation plan liabilities, acquisition expenses, realignment expenses (income), and stock‑based compensation expense, for the respective periods.

Adjusted net income and Adjusted EPS

Adjusted net income and Adjusted EPS are non-GAAP financial measures presenting the earnings generated by our ongoing operations that we believe is useful to investors in making meaningful comparisons to other companies, although these measures may not be directly comparable to similar measures used by other companies, and period-over-period comparisons.

Adjusted net income is defined as net income adjusted for the following: amortization of purchased intangibles, stock‑based compensation expense, expense (income) relating to deferred compensation plan liabilities, acquisition expenses, realignment expenses (income), other non‑operating (income) expense, net, the tax effect of the above adjustments to net income, and equity in net (income) losses of investees, net of tax, for the respective periods. The income tax effect of non‑GAAP adjustments was determined using the applicable rates in the taxing jurisdictions in which income or expense occurred, and represent both current and deferred income tax expense or benefit based on the nature of the non‑GAAP adjustments, including the tax effects of non‑cash stock‑based compensation expense.

Adjusted EPS is calculated as Adjusted net income, less net income attributable to participating securities, plus interest expense, net of tax, attributable to the convertible senior notes using the if‑converted method, if applicable, (numerator) divided by Adjusted weighted average shares, diluted (denominator). Adjusted weighted average shares, diluted is calculated by adding incremental shares related to the dilutive effect of convertible senior notes using the if‑converted method, if applicable, to weighted average shares, diluted.

Adjusted EBITDA

Adjusted EBITDA is our liquidity measure in the context of conversion of Adjusted EBITDA to cash flow from operations (i.e., the ratio of GAAP cash flow from operations to Adjusted EBITDA). We believe this non-GAAP financial measure provides a meaningful measure of liquidity and a useful basis for assessing our ability to repay debt, make strategic acquisitions and investments, and return capital to investors.

Adjusted EBITDA is defined as cash flow from operations adjusted for the following: cash interest, cash taxes, cash deferred compensation plan distributions, cash acquisition expenses, changes in operating assets and liabilities, and other cash items (such as those related to our interest rate swap). From time to time, we may exclude from Adjusted EBITDA the impact of certain cash receipts or payments that affect period-to-period comparability.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240507850727/en/

BSY Investor Contact:

Eric Boyer

Investor Relations Officer

ir@bentley.com

Source: Bentley Systems, Incorporated

FAQ

What were Bentley Systems' total revenues for the first quarter of 2024?

Bentley Systems reported total revenues of $337.8 million for the first quarter of 2024.

How much did subscriptions revenues increase by in the first quarter of 2024?

Subscriptions revenues grew by 10.5% to $307.1 million in the first quarter of 2024.

What was the Annualized Recurring Revenues (ARR) for Bentley Systems as of March 31, 2024?

Bentley Systems' Annualized Recurring Revenues (ARR) reached $1,186.5 million as of March 31, 2024.

What was the operating income margin for Bentley Systems in the first quarter of 2024?

Bentley Systems' operating income margin improved to 27.2% in the first quarter of 2024.

What was the net income per diluted share for Bentley Systems in the first quarter of 2024?

Bentley Systems reported a net income per diluted share of $0.22 in the first quarter of 2024.