DGAP-News: The RIB Group announces its figures for the first half of 2019. Continued strong Revenue growth and increased Guidance with respect to Revenue and operating EBITDA

31-July-2019

The RIB Group announces its figures for the first half of 2019. Continued strong Revenue growth and increased Guidance with respect to Revenue and operating EBITDA

- Recurring revenues (ARR) grow by 87.0% to EUR 51.8 million (previous year: EUR 27.7 million)

- The EBITDA margin in the iMTWO segment remains at a high level of 25.2%

- Guidance raised: Revenues EUR 200 million to EUR 220 million (previously: EUR 180 million to EUR 200 million) and operating EBITDA EUR 45 million to EUR 50 million (previously: EUR 36 million to EUR 46 million)

- The number of MTWO/iTWO 4.0 platform users grows by 145.4% compared to Q1 2019 to 20,726 users

Stuttgart, Germany, 31 July 2019. RIB Software SE, the world's leading provider of iTWO 4.0 Cloud Enterprise Platform Technology, today announces its financial figures for the first half of 2019.

Increase of REVENUE GUIDANCE
Based on the first six months and a very strong development in July as well as a continued strong M&A pipeline, RIB increases its revenue Guidance from EUR 180 million - EUR 200 million to EUR 200 million - EUR 220 million (2018 Group Revenues: EUR 136.9 million). In H1 2019, ARR revenue grew by 87.0%, international revenue growth reached 73.2%, and gross profit in the Software area (ARR) was 60.7%. We can feel a very strong growing demand for the MTWO Cloud and the top 100 iTWO 4.0 modules worldwide. After passing EUR 100 million revenue in 2018 and EUR 200 million in 2019, we estimate that we can pass EUR 300 million in 2020 with a constant growth rate and continued strong demand.

Increase of EBITDA GUIDANCE and strong organic growth
Based on the first six months and a very strong performance in July as well as a continued strong M&A pipeline, RIB increases its operating EBITDA Guidance from EUR 36 million - EUR 46 Million to EUR 45 million - EUR 50 million. In the iMTWO Segment (95% of RIB' business), the EBITDA margin was 25.2%. Over 50% of Phase-II-deal revenue was generated out of subscription. If the iTWO software revenue (only from Phase II) was generated 100% out of licence like 2018 in the iMTWO segment, the EBITDA margin would have been 27% and the organic growth 10% instead of 5.3%. But the positive impact of the switch from licence to subscription will be seen in the near future with strong EBITDA margins.

Adjusted by one off start-up cost in new business lines and M&A costs, the EBITDA could reach up to EUR 55 million in 2019. We confirm our expectation of a strong double-digit organic growth and 30%+ EBITDA margin at the end of the 2021 ending investment period.

GROUP LIQUIDITY, M&A capacity, 48% topline growth in Q2 and next quarters
EUR 185.9 million group liquidity minus outstanding payments for acquisitions in the amount of EUR 28.8 million (results in EUR 157.1 million) plus 3.719 million treasury shares (value EUR 17.60 per share; equals EUR 65.5 million) results in EUR 222.6 million. In 2019, we invested in Levtech/Dubai, Datengut/Leipzig, Cadline/London, BSD/Atlanta and CCS/Johannesburg. Including 2018, we invested already over EUR 100 million and we will continue to invest into acquisitions but focus on larger size investments in USA, India and leading construction software companies like BSD and CSS. We confirm our target to reach an average revenue growth rate of 30-60% p.a. during the investment phase.

30,000 USER MTWO/iTWO 4.0 platform in 2019 and further targets
In the first 6 months, we reached 20,726 USERS (+145.4%) for MTWO and iTWO 4.0. We estimate that we will reach over 30,000 USERS in 2019 and we confirm our target to reach over 100,000 USERS in 2020 and 2 million USERS in the midterm.

McTWO and Microsoft Partnership to build the global leading vertical cloud for the building industry
The Microsoft partnership is on track. We are focusing on transforming our USER base on the MTWO platform and investing in AI (McTWO) and into IoT software for the iMTWO and xYTWO segments. The investments into MSP's are also on track and we estimate to complete the RIB direct sales and consulting network in 2019.

Global Market leadership in BIM 5D (3D plus Cost and Time) cost and estimation enterprise software (technical ERP)
RIB with its 1,400+ experienced employees in over 20 countries with over 500.000 USERS is a market leader in cloud-based BIM enterprise software for estimation and technical ERP in Europe, Australia and Africa and with strong positions in USA, Asia and Middle East.

xYTWO segment
xYTWO revenue is estimated under 5% in 2019. xTWO has reached a positive EBITDA margin in Q2 2019. Due to the strong demand for iTWO 4.0 and MTWO, we decided not to expand YTWO's customer base in H1 and to focus on MTWO, iTWO 4.0 and the integration of new business units. xYTWO will deliver positive impact in the midterm as planned.

Contract period Tom Wolf
The CEO's employment contract ends in 2022 and Tom Wolf (age 62) has informed that he will not renew his contract as Managing Director. It remains to be seen whether he will continue to be a member of the Administrative Board. In the next 12 - 24 months a succession plan for the position of CEO is to be worked out.

Strategy 2020-2030
The Administrative Board develops a strategy for the years 2020 - 2030 to ensure the long-term success of the company. The goal of the strategy is to establish and sustainably expand RIB's position as the global market leader for cloud-based BIM enterprise software. In addition to the stand-alone option, the company also takes advantage of discussion opportunities from potential strategists and financial investors about opportunities to engage in the Company in the interests of the Group, our shareholders and our customers. No concrete results are therefore available.

Trade War, RIB markets and competitors
China software sale is under 1% of total sales. Therefore, we are not seeing any substantial negative impact of the trade war between the USA and China. The cloud and BIM construction software market is growing on high speed. Building markets are booming. RIB could increase the distance to our competitors in H1 2019 in many fields and we believe we can reach the midterm target to be a leading platform provider in our industry.

FIGURES SEGMENT iMTWO:

FIGURES SEGMENT xYTWO:

CONSOLIDATED FIGURES - OVERVIEW

* Cash and cash equivalents, time deposits and available-for-sale securities. Previous year as of 31 December 2018

** Previous year as of 31 December 2018

The complete Interim Report (January - June 2019) is available for download on the RIB Group website under Investor Relations.

About RIB Group

RIB Software SE is an innovator in building and construction industry. The company creates, develops and offers cutting-edge digital technologies for construction enterprises and projects across various industries worldwide. iTWO 4.0, RIB's flagship cloud-based platform, provides the world's first enterprise cloud technology based on 5D BIM with AI integration for construction companies, industrial companies, developers and project owners, etc. With over 50 years of experiences in construction industry, RIB Software SE focuses on IT and engineering and becomes the pioneer in construction innovation, exploring and brining in new thinking, new working methods and new technologies to enhance construction productivity. RIB is headquartered in Stuttgart, Germany and Hong Kong, China, and listed on the prime standard Frankfurt Stock Exchange since 2011. With over 1,400 talents in more than 30 locations worldwide, RIB is targeting to transform the construction industry into the most advanced and digitalized industry in the 21st century.