Still working to catch up on what happened while you were at PTC Live? Me too! Honestly, it would be so much simpler if everything just went on hold while we’re these things, right?! Not gonna happen, so catch-up it is. In addition to 3D Systems trying to acquire Phenix, ESI Group reported results for the first quarter.
In a nutshell, revenue was up 2.0% as reported to €21.6 million, characterized as “solid … despite a negative base effect associated with the depreciation of the Japanese yen” by CEO Alain de Rouvray. M. de Rouvray cited growth in the BRIC countries and highlighted ESI’s joint venture with the Chinese Aerospace Group AVIC-BIAM and a “sharp” increase in sales activity in Brazil.
- License revenue was €14.6 million, up 1% as reported but up 6% in constant currencies. ESI points to two reasons for the relatively slow growth (Q1 is never great for ESI): the weak Yen made its products expensive there, and a tough comparable a year ago, when license revenue was up a very robust 19%.
- Services revenue was €7.1 million, up 3% as reported but up 6% in constant currencies. All of that growth was from the OpenCFD acquisition, as organic services revenue shrank 1%.
- By geo, the best news came from the Americas which reported revenue of €4.3 million, up 15% in constant currency “reflecting a good base level of activity as well as a slight catch-up effect for licenses following the slowdown observed over the final quarter of the previous fiscal year.” The Americas also includes Brazil, which apparently grew quite a bit, though ESI didn’t give details.
Revenue from Europe was €8.9 million, up 5%.
Revenue from Asia was €8.4 million, down 5%, as a result of the depreciation of the Japanese Yen.
- Mixed into the regions are the BRIC countries, Brazil, Russia, India and China. ESI says that 15.6% of orders in Q1 came from BRIC countries, up from 13.5% in the year-ago quarter.
ESI doesn’t give forward-looking guidance but M. de Rouvray did sound a cautionary note in his prepared remarks: “[Successes in emerging countries] are reassuring in the context of a macroeconomic situation that has become more difficult again, whilst the increasing complexity associated with globalisation requires the Group’s internal reporting structure and processes to be adapted.”
I found it encouraging that OpenCFD is starting to contribute a bit more robustly. Recall that Q4 included €343,000 from OpenCFD, acquired in September. It appears as though it contributed about €420,000 in Q1, which would be a nice sequential increase. I caution, though this is my math, from small percentages on small numbers. But, ballpark, it looks like OpenCFD is doing well under its new owners.