Dassault systemes: The professional software specialist Dassault Systèmes wants to double its earnings per share in 2028

(BFM Bourse) – The computer-aided design and manufacturing software publisher announced on Friday that it is aiming for earnings per share of between 2.20 euros and 2.40 euros per share by this horizon.

The time for the transfer of power has come at Dassault Systèmes. The professional software specialist with its famous computer-aided design and manufacturing licenses (Catia, Solidworks) has announced that its Deputy Chief Executive Officer, Pascal Daloz, will become Chief Executive Officer from January 1, 2024, succeeding Bernard Charlès, who will remain also Chairman of the Board of Directors.

This handover had been prepared for several months, Pascal Daloz having been appointed Deputy Chief Executive Officer last January. The leader had joined the group in 2001, with the mission at the time of developing the group in product life cycle management solutions. He had notably taken over the management of financial affairs and strategy in 2018.

But beyond this expected announcement, Dassault Systèmes also delivered its medium-term financial ambitions, ahead of a day dedicated to investors, which will begin at 1 p.m. this Friday.

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Double digit growth

In its previous medium-term plan, the group expected to generate earnings per share

of 1.20 euros per share by 2024. Except that this target should be more or less reached this year, the company aiming for earnings per share of between 1.18 euros and 1.20 euros.

Hence the need to define a new medium-term target. Thus, by 2028, Dassault Systèmes expects to generate earnings per share of between 2.20 euros and 2.40 euros, or approximately double that of 2022 (1.13 euros).

This objective seems to be situated a priori at the level of the expectations of the design offices. UBS anticipated a figure of 2.40 euros per share. Stifel for his part was counting on a range of 2 euros to 2.20 euros.

On the Paris Stock Exchange, the Dassault Systèmes title is nevertheless down 1.8% around 9:25 a.m., which constitutes the largest drop in the CAC 40. “The objectives are ambitious but perhaps the market was waiting for announcements on the mergers and acquisitions plan. And then more generally, the market tends to sanction Dassault Systèmes’ announcements on D-Day and then come back to them a few days later”, underlines an analyst.

“The strength of Dassault Systèmes’ business model and balance sheet allows us to take advantage of the considerable opportunities present in our addressable markets, and to support a sustainable, double-digit growth of our turnover”, declared in a statement from Dassault Systèmes Deputy Chief Financial Officer Rouven Bergmann.

Life sciences as a driver of growth

“The high cash conversion rate, combined with a disciplined capital allocation strategy, provides us with comfortable financial flexibility to pursue the development of Dassault Systèmes, both organically and through acquisitions”, a- he added.

Analysts estimate that the group can mobilize between 5 and 6 billion euros to make acquisitions. [les perspectives, NDLR] In light of these announcements, Invest Securities believes that “the good surprise comes from the guidance

2028 of double-digit growth in turnover, which marks an acceleration compared to the current momentum (+8% approximately)”. “However, it is very likely that this momentum will not be purely organic, even if the group does not specify nothing at this stage”, he adds. The design office believes that this roadmap is in line with previous plans.

Historically present in aeronautics and more broadly in industry, Dassault Systèmes has developed since 2019 in life sciences and health with the acquisition of Medidata. So much so that this segment now represents an important engine of growth for the company. Stifel estimates that it should show revenue growth of around 15% per year over the period 2022-2027, thanks to the growing adoption of software in clinical trials.