As of January 1st 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, the prior year comparative information is not adjusted.
The estimated impacts based on the leases contracts at the date of initial application are the following:
At January 1st 2019,
- Recognition in the balance sheet of Right of Use Assets of about €390 million and of Lease Liabilities of about €470m
- Equity impact before tax of about €55 million
For Full Year 2019, with an almost linear pattern throughout the
- Improvement in the operating margin of about €11 million
- Decrease in financial income net of about €13 million
- Immaterial effect on pre-tax net result of about €-2 million
These estimated impacts on the future Company’s performances are factored in the 2019 Full Year and First Quarter objectives presented above.
Cash Flow and Other Financial Highlights Under IAS 18 For Year-over-Year Comparisons
The Company’s net cash flow from operations for the three and twelve months ended December 31, 2018 are identical under IFRS 15 in comparison to IAS 18 although some of the line items differ. (See pages 16 and 22 in the Appendix to this press release for further details including a reconciliation of the cash flow statement and balance sheets under IFRS 15 compared to IAS 18 for the quarter, year and period ended December 31, 2018.)
IAS 18 net operating cash flow increased 21% to €898.6 million for 2018 compared to €745.0 million for 2017 period principally reflecting growth in net income and non-cash operating adjustments.
Dassault Systèmes’ uses of cash for 2018 were principally for payment for acquisitions, net of cash acquired and non-controlling interests totaling €353.1 million; share repurchases of €206.3 million cash dividends of €38.0 million (based on the shareholders electing payment of the dividend in cash); and capital expenditures, net of €72.4 million. The Company received cash for stock options exercised of €69.9 million.
Dassault Systèmes’ net financial position totaled €1.81 billion at December 31, 2018, compared to €1.46 billion at December 31, 2017, reflecting cash, cash equivalents and short-term investments of €2.8 billion and debt related to credit lines of €1.0 billion.
Summary of Recent Business, Technology and Customer Announcements
Customers and Partners
On December 18, 2018, Dassault Systèmes announced that it is supporting Bridgestone EMEA on its new smart factory program to optimize plant performance by digitally transforming its tire production planning and execution across Europe. Bridgestone EMEA will use the DELMIA Apriso and QUINTIQ applications powered by the 3DEXPERIENCE platform to manage its manufacturing operations, its production planning and to optimize eight production sites in Europe. Bridgestone EMEA is a key regional subsidiary of Tokyo-based Bridgestone Corporation, the world’s largest manufacturer of tires and other rubber products.
On November 15, 2018, Dassault Systèmes announced that GLM Co. Ltd., an emerging Japanese developer of environmentally friendly automobiles and related services, has deployed the 3DEXPERIENCE platform to expand its electric vehicle development business. As the first company in Japan to mass-produce an electric sports car, GLM will be able to meet the high demand for its expertise and its own technical platform of electric vehicle development solutions including chassis, power systems, and vehicle control units, which automotive manufacturers and new entrants from other industries are using to deliver market innovations.
On November 6, 2018, Bureau Veritas, Naval Group and Dassault
Systèmes announced jointly that a 3D classification process has been
applied to a significant naval vessel for the first time. This marks a
major step forward in the design review and calculation modelling
required for class approvals in the design and construction of new
ships, as well as in the digital transformation of the marine industry.
The collaborative project to develop the concept of 3D classification
combines the expertise of Bureau Veritas in testing, inspection and
certification; of Naval Group in the design and construction of high
technology military vessels; and of Dassault Systèmes with its 3DEXPERIENCE
platform, 3D design software, 3D digital mock up and product lifecycle
management solutions. Together, the project partners aimed at enabling
digital continuity to reduce the time and associated costs spent in
design review, and to improve data accuracy and traceability by sharing
information more effectively between different project stakeholders.