Nemetschek (NEM) Q2 2024 earnings summary

Executive summary

• Closed the largest acquisition in company history with GoCanvas on July 1, 2024, expected to accelerate SaaS transition, growth, and generate significant synergies, especially with Bluebeam.

• Achieved strong H1 2024 results with revenue up 9.6% to €451.6 million, driven by SaaS momentum and international expansion.

• Recurring revenue now represents 85% of total, with subscription/SaaS revenues surpassing 50% for the first time and up 74.9%.

• Transition to a subscription/SaaS-centric model is progressing rapidly, driving record ARR and profitability.

• Profitability in Q2 impacted by one-off M&A costs; operational development remains on track.

Financial highlights

• H1 2024 revenue grew 9.6% to €451.6M; Q2 revenue €227.7M (+9.7%); ARR up 26.5% to €797.9M.

• Subscription/SaaS revenue in H1: €230.9M (+74.9%); recurring revenue share reached 85%.

• EBITDA H1: €129.7M (+10.8%), margin 28.7%; adjusted margin (excl. M&A costs): 30%.

• Net income H1: €84.5M (+22.3%); EPS at €0.73, up from €0.60.

• Free cash flow before M&A: €135.6M (+18.2%); cash conversion at 109%.

Outlook and guidance

• 2024 organic guidance confirmed: revenue growth at constant currency of 10–11%, EBITDA margin 30–31%, ARR growth ~25%.

• GoCanvas acquisition adds ~3pp to revenue growth but dilutes EBITDA margin by ~100bps; ARR growth expected to exceed 30% with GoCanvas.

• Recurring revenue share projected at ~85% for 2024.

• Q3 group growth expected in high single digits, with Q4 Build segment growth to more than triple.

• Guidance assumes stable macroeconomic and sector conditions.