2015 3DEXPERIENCE®
A N N U A L R E P O R T
DASSAULT SYSTÈMES FINANCIAL REPORT
GROUP PRESENTATION
FINANCIAL REVIEW & STATEMENTS
CORPORATE GOVERNANCE
GENERAL MEETING OF SHAREHOLDERS
CONTENTS
1
2
3
4
PERSON RESPONSIBLE
PRESENTATION OF THE GROUP
1.1 Key Figures
1.2 History
1.3 Group Organization
1.4 Business Activities
1.5 Research and Development
1.6 Risk factors
SOCIAL, SOCIETAL AND
ENVIRONMENTAL RESPONSIBILITY
2.1 Social and Societal Responsibility
2.2 Environmental Responsibility
2.3
Independent Verifi er’s Attestation
and Assurance Report on Social, Societal
and Environmental Information
3
5
6
8
12
14
27
28
37
38
58
68
FINANCIAL REVIEW AND PROSPECTS 71
3.1 Operating and Financial Review
3.2 2016 Financial Objectives and Multi-Year Growth Plan
3.3
Interim and Other Financial Information
FINANCIAL STATEMENTS
4.1 Consolidated Financial Statements
4.2 Parent Company Financial Statements
4.3 Legal and Arbitration Proceedings
72
83
84
85
86
124
150
5
6
7
CORPORATE GOVERNANCE
151
5.1 Report of the Chairman on Corporate Governance
and Internal Control
5.2 Report of the Statutory Auditors on Corporate
Governance and Internal Control
5.3 Summary of the Compensation and Benefi ts Due
to Corporate Offi cers (mandataires sociaux)
5.4 Transactions in the Company’s Shares
by the Management of the Company
5.5 Statutory Auditors
INFORMATION ABOUT
DASSAULT SYSTÈMES SE, THE SHARE
CAPITAL AND THE OWNERSHIP
STRUCTURE
6.1
Information about Dassault Systèmes SE
6.2
Information about the Share Capital
6.3
Information about the Shareholders
6.4 Stock Market Information
GENERAL MEETING
7.1 Presentation of the Resolutions Proposed
by the Board of Directors to the General Meeting
on May 26, 2016
7.2 Draft Resolutions Proposed by the Board of Directors
to the General Meeting on May 26, 2016
152
171
172
181
184
185
186
189
194
199
201
202
208
CROSS-REFERENCE TABLES
216
ANNUAL REPORT 2015
ANNUAL FINANCIAL REPORT
This document is an English-language translation of Dassault Systèmes’ Document de référence (Annual Report), which was fi led
with the AMF (French Financial Markets Authority) on March 23 , 2016, in accordance with Articles 212-13 of the AMF General
Regulation.
Only the French version of the Document de référence is legally binding.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
1
GENERAL
This Annual Report also includes:
(cid:125) the annual fi nancial report to be prepared and published by
every listed company within four months of the end of its
fi scal year, pursuant to Article L. 451-1-2 of the Monetary
and Financial Code and Article 222-3 of the French Financial
Markets Authority (“AMF”) General Regulation; and
(cid:125) the annual management report of Dassault Systèmes SE’s
Board of Directors, which must be provided to the
General Meeting of Shareholders approving the fi nancial
statements for each completed fi scal year, pursuant to
Articles L. 225-100 et seq. of the French Commercial Code.
The index set forth on page 216 provides cross-references to
the relevant portions of these two reports.
All references to “euro” or to the symbol “€” refer to the legal
currency of the French Republic and certain countries of the
European Union. All references to the “U.S. dollar” or to the
symbol “$” refer to the legal currency of the United States.
As used herein, “Dassault Systèmes”, the “Company” or the
“Group” refers to Dassault Systèmes SE and all the companies
included in the scope of consolidation.
“Dassault Systèmes SE” refers only to the European parent
company of the Group,which is governed by French law .
In compliance with Article 28 of European Regulation
no. 809/2004 of the Commission, the following information
is incorporated by reference in this Annual Report:
(cid:125) the consolidated fi nancial statements on pages 84 to 120
(inclusive), the parent company fi nancial statements on
pages 123 to 143 (inclusive), and the related audit reports on
pages 121 to 122 and, 145 to 148 (inclusive) of the Annual
Report (Document de référence) for the year 2014 fi led with
the AMF on March 24, 2015, under no. D. 15- 0195;
(cid:125) the fi nancial information on pages 70 to 82 (inclusive)
of the Annual Report (Document de référence) for the
year 2014 fi led with the AMF on March 24, 2015, under
no. D. 15- 0195;
(cid:125) the consolidated fi nancial statements on pages 66 to 100
(inclusive), the parent company fi nancial statements on
pages 102 to 122 (inclusive), and the related audit reports
on pages 101, 124 to 127 (inclusive) of the Annual Report
(Document de référence) for the year 2013 fi led with the
AMF on March 28, 2014, under no. D. 14-0227;
(cid:125) the fi nancial information on pages 56 to 65 (inclusive)
of the Annual Report (Document de référence) for the
year 2013 fi led with the AMF on March 28, 2014, under
no. D. 14- 0227.
The portions of these documents which are not incorporated
herein are either not relevant for current investors, or are
covered in another section of this Annual Report.
2 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
PERSON RESPONSIBLE
Person Responsible for the Annual Report
Bernard Charlès – President and Chief Executive Offi cer.
Certifi cation by the Person Responsible
for the Annual Report
Vélizy-Villacoublay, March 22 , 2016.
“I hereby certify, after having taken all reasonable measures
for this purpose, that the information contained in this Annual
Report (Document de référence) is, to my knowledge, in
accordance with the facts and that no information liable to
affect its signifi cance has been omitted.
I certify that, to my knowledge, the fi nancial statements
have been prepared in accordance with applicable accounting
standards and give a faithful representation of the assets,
fi nancial situation and results of Dassault Systèmes SE and
all the companies included in the scope of consolidation, and
that the “management report” included in this Annual Report,
presents a faithful representation of the business trends,
results and fi nancial situation of Dassault Systèmes SE and all
the companies included in the scope of consolidation as well
as a description of the principal risks and uncertainties which
they face.
I have received a completion letter (lettre de fin de travaux) from
the auditors stating that they have verifi ed the information
regarding the fi nancial situation and the fi nancial statements
included in this Annual Report and that they have read this
document in its entirety.
The consolidated fi nancial statements for the year 2013
are covered by a report of the Statutory Auditors, set forth
on page 101 of the English-language translation of the
registration document for the year 2013 – fi led with the AMF
on March 28, 2014 under the number D. 14-0227 – which
contains an observation”.
Bernard Charlès
President and Chief Executive Offi cer
DASSAULT SYSTÈMES ANNUAL REPORT 2015
3
4 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
1
PRESENTATION
OF THE GROUP
CONTENTS
1.5 Research and Development
1.5.1 Overview
1.5.2 Intellectual Property
1.6 Risk factors
1.6.1 Risks Related to the Company’s Business
1.6.2 Financial and Market Risks
1.6.3 Insurance
27
27
27
28
28
35
36
1.1 Key Figures
1.2 History
1.2.1 History and Development of the Company
1.2.2 Investments
1.3 Group Organization
1.3.1 Dassault Systèmes SE’s Position within the Group
1.3.2 Principal Subsidiaries of the Company
1.4 Business Activities
1.4.1 Principal Activities
1.4.2 Principal Markets
1.4.3 Material Contracts
6
8
8
11
12
12
13
14
14
18
26
DASSAULT SYSTÈMES ANNUAL REPORT 2015 5
1 Presentation of the Group
Key Figures
1.1 Key Figures
The selected financial information set forth below has been
prepared in accordance with International Financial Reporting
Standards (“IFRS”) as adopted in the European Union, unless
otherwise indicated.
A financial review including a comparison of 2015 and 2014
can be found in Chapter 3, “Financial review and prospects”.
(in millions, except percentages and per share data)
Total revenue
Software revenue
Operating income
As a percentage of total revenue
Net income attributable to equity holders of the Company
Diluted net income per share (1)
Dividend per share (1)
Supplemental non-IFRS financial information (3)
Total revenue
Software revenue
Operating income
As a percentage of total revenue
Net income attributable to equity holders of the Company
Diluted net income per share (1)
Year ended December 31,
2015
€2,839.5
2,502.8
633.2
22.3%
402.2
€1.57
€0.47 (2)
2014
€2,294.3
2,035.0
430.8
18.8%
291.3
€1.14
€0.43
2013
€2,066.1
1,880.8
503.0
24.3%
352.3
€1.38
€0.42
€2,876.7
2,537.9
€2,346.7
2,078.6
€2,072.8
1,887.5
884.9
30.8%
576.6
€2.25
699.2
29.8%
465.5
€1.82
652.8
31.5%
445.5
€1.75
(1) All historical per share data reflects the two-for-one stock split effected in July 2014 (see paragraph 6.2 “Information about the Share Capital”).
(2) To be proposed for approval at the General Meeting of Shareholders scheduled for May 26, 2016.
(3) Readers are cautioned that the supplemental non-IFRS financial information is subject to inherent limitations. It is not based on any comprehensive set of accounting rules or
principles and should not be considered in isolation from or as a substitute for IFRS measurements. The supplemental non-IFRS financial information should be read only in
conjunction with the Company’s consolidated financial statements prepared in accordance with IFRS. Furthermore, the supplemental non-IFRS financial information may not be
comparable to similarly titled adjusted measures used by other companies. For a reconciliation of this non-IFRS financial information with the Company’s audited financial
statements, see paragraph 3.1.1.2 “Supplemental Non-IFRS Financial Information”.
6 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
(in millions)
ASSETS
Presentation of the Group
Key Figures
1
Year ended December 31,
2015
2014*
2013
1
Cash, cash equivalents and short-term investments
€2,351.3
€1,175.5
€1,803.7
Trade accounts receivable, net
Other assets
TOTAL ASSETS
LIABILITIES AND EQUITY
Unearned revenue
Borrowings
Other liabilities
Parent shareholders’ equity
TOTAL LIABILITIES AND EQUITY
739.1
3,221.0
6,311.4
778.0
1,000.0
1,064.9
3,468.5
627.7
3,159.2
4,962.4
636.8
360.1
1,022.0
2,943.5
€6,311.4
€4,962.4
*
The consolidated balance sheet as of December 31, 2014 has been restated to reflect the finalized purchase price allocation for prior year business combinations.
(in millions)
Net cash provided by operating activities
Net cash used in investing activities
Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash equivalents
Year ended December 31,
2015
€633.3
(60.5)
548.4
55.1
2014
€499.5
(1,000.9)
(170.3)
38.0
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
€1,176.3
€(633.7)
472.6
1,911.6
4,187.9
489.0
380.0
708.4
2,610.5
€4,187.9
2013
€506.8
(168.6)
276.2
(35.8)
€578.6
DASSAULT SYSTÈMES ANNUAL REPORT 2015 7
1 Presentation of the Group
History
1.2 History
1.2.1 History and Development of the Company
1.2.1.1
Summary
Dassault Systèmes, the 3DEXPERIENCE Company, provides
software applications and services, designed to support
companies’ innovation processes. The Company’s software
applications and services span design from ideation, to
early 3D digital conceptual design drawings to full digital
mock-up; virtual testing of products; end-to-end global
industrial operations, including manufacturing management
to operations planning & optimization; and in marketing and
sales from digital marketing and advertising to end-consumer
shopping experience. The Group brings value to over
200,000 customers of all sizes, in all industries, in more
than 140 countries. Dassault Systèmes is the world leader
of the global Product Lifecycle Management (“PLM”) market
(design, simulation, manufacturing and collaboration) based
upon end-user software revenue, a position which it has held
since 1999.
Dassault Systèmes was established in 1981 through the
spin-off of a small team of engineers from Dassault Aviation,
which was developing software to design wind tunnel models
and therefore reduce the cycle time for wind tunnel testing,
using modeling in three dimensions (“3D”). The Company
entered into a distribution agreement with IBM the same year
and started to sell its software under the CATIA brand. With
the introduction of its Version 3 (“V3”) architecture in 1986,
the foundations of 3D modeling for product design were
established.
its work with
Through
industrial customers, the
large
Company learned how important it was for them to have a
software solution that would support the design of highly
diversified parts in 3D. The growing adoption of 3D design
for all components of complex products, such as airplanes and
cars, triggered the vision for transforming the 3D part design
process into an integrated product design. The Version 4
(“V4”) architecture was created, opening new possibilities
to realize full digital mock-ups (“DMU”) of any product. The
V4 architected software solutions helped customers reduce
the number of physical prototypes and realize substantial
savings in product development cycle times, and it made
global engineering possible as engineers were able to share
their ongoing work across the globe virtually.
In order to fulfill the mission to provide a robust 3D Product
Lifecycle Management (“PLM”) solution supporting the entire
product lifecycle from design to manufacturing, the Company
developed and introduced its next software architecture in
1999, Version 5 (“V5”). In conjunction with its strategy and
product portfolio development plans, the Company undertook
a series of targeted acquisitions expanding its software
applications portfolio offering to include digital manufacturing,
realistic simulation, product data management and enterprise
business process collaboration.
In 2012, the Company unveiled
its current horizon,
3DEXPERIENCE, based on the Company’s technology
architecture Version 6 (“V6”) and designed to support its
clients in their innovation process so that they can invent the
future of their users’ experiences. 3DEXPERIENCE builds upon
the Company’s work in 3D, DMU, and PLM, and reflects the
evolution Dassault Systèmes began to see among its clients
in different industry verticals. It can be used on premise or
online, in a public or private cloud. With 3DEXPERIENCE,
the Company expanded
its purpose to encompass the
harmonization of product, nature and life; and moved to an
industry go-to-market strategy.
See paragraphs 1.2.1.3 “Dassault Systèmes’ Purpose and
Strategy”, 1.4.1.1 “Summary” and 1.4.1.4 “Technology and
Science” for further information.
8 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Presentation of the Group
History
1
1
1.2.1.2
Summary Timeline
1981
(cid:96) Creation of Dassault Systèmes to design products in 3D
through the spin-off of a team of engineers from Dassault
Aviation;
(cid:96) The Company’s fl agship brand, CATIA, is launched;
(cid:96) Worldwide marketing, sales and support agreement with
IBM, beginning of a long-standing partnership;
(cid:96) Initial industry focus: automotive and aerospace.
1986
(cid:96) V3 software introduced for 3D Design.
1994
(cid:96) V4 architecture introduced offering a new technology
enabling the full Digital Mock-Up (“DMU”) of a product,
enabling customers to signifi cantly reduce the number of
physical prototypes and to have a complete understanding
of the virtual product;
(cid:96) Expansion of the Company’s industry focus to seven
industries, adding fabrication and assembly, consumer
goods, high-tech, shipbuilding and energy.
1996
(cid:96) Initial public offering in Paris and listing on the NASDAQ (the
Company voluntarily delisted from the NASDAQ in 2008).
1997
(cid:96) Broadening of the Company’s 3D design product line to
the entry 3D market, with the acquisition of the start-up
SOLIDWORKS, with a Windows-native architecture, to target
principally the 2D to 3D migration market opportunity;
(cid:96) Formation of the Company’s Professional channel, focused
on marketing, sales and support of SOLIDWORKS.
1998
(cid:96) Creation of the ENOVIA brand, focused on management of
CATIA product data with the acquisition of IBM’s Product
Manager software.
2005
(cid:96) Creation of the SIMULIA brand, addressing realistic
simulation, representing a signifi cant expansion of the
Company’s simulation capabilities, leveraging the acquisition
of Abaqus;
(cid:96) Creation of the Company’s PLM Value Solutions sales
channel, an indirect channel for the PLM market specifi cally
focused on supporting SMB companies.
2006
(cid:96) Expansion of the ENOVIA portfolio with the acquisition of
MatrixOne, a global provider of collaborative PDM software
and services;
(cid:96) Expansion of the Company’s industry focus from seven to
11 industries.
2007
(cid:96) Amendment of the IBM PLM partnership agreement,
outlining the progressive assumption of full responsibility
for the Company’s PLM Value Solutions channel;
(cid:96) Creation of the 3DVIA brand. Building upon several years
of research and investment, 3DVIA was launched to bring
3D technology to new users to imagine, communicate and
experience in 3D;
(cid:96) Further expanding its product offering for CATIA, the
Company acquired ICEM, a company well-known in the
automotive industry for its styling and high-quality surface
modeling and rendering solutions.
2008
(cid:96) Introduction of the Company’s V6 architecture.
2010
(cid:96) The Company acquires full control of its distribution sales
channels with the acquisition of IBM PLM, the IBM business
unit dedicated exclusively to the marketing, sale and support
of the Company’s PLM software;
(cid:96) Acquisition of Exalead, a French company providing search
platforms and search-based applications for consumer and
business users.
1999
(cid:96) Launch of V5, a new architecture software for the PLM market
designed for both Windows NT and UNIX environments;
(cid:96) The Company expands its ENOVIA product line with
the acquisition of SmarTeam focused on product data
management for the small and mid-sized companies
(“SMB”) market.
2011
(cid:96) DELMIA’s offering expands with the acquisition of Intercim,
offering manufacturing and production management
software for advanced and highly regulated industries;
(cid:96) 100% of the Company’s total revenues are derived from
its wholly-directed three sales channels, completing the
transition from IBM begun in 2005.
2000
(cid:96) Creation of the DELMIA brand, addressing the digital
manufacturing domain (digital process planning, robotic
simulation and human modeling technology).
2012
(cid:96) Expansion of the Company’s strategy to 3DEXPERIENCE and
expansion of the Company’s purpose. See paragraph 1.2.1.3
“Dassault Systèmes’ Purpose and Strategy”;
DASSAULT SYSTÈMES ANNUAL REPORT 2015 9
1 Presentation of the Group
History
(cid:96) Creation of a new brand, GEOVIA, dedicated to model the
planet, focus on a new industrial sector, Natural Resources,
with the acquisition of Gemcom in the mining sector;
(cid:96) Acquisitions of Netvibes, bringing intelligent dashboarding
capabilities, and SquareClock, providing cloud-based
3D space planning solutions;
(cid:96) Introduction of the Company’s fi rst Industry Solution
Experiences.
2013
(cid:96) Unveiling of V6 Release 2014, available to select customers,
on premise as well as Software as a Service (SaaS),
featuring the controlled availability of existing and new
industry-focused and user-focused offerings and the
introduction of a new navigational user interface;
(cid:96) Broadening of the Company’s manufacturing offerings to
Manufacturing Operations Management with the acquisition
of Apriso.
2014
(cid:96) Introduction of 3DEXPERIENCE R2014x, the fi rst release
of the Company’s new 3DEXPERIENCE platform, offering
end-to-end
engineering,
manufacturing and business capabilities and services, with
the V6 architecture as its foundation;
integrated
scientifi c,
and
(cid:96) Creation of a new brand, 3DEXCITE, with the acquisition
of Realtime Technology AG (“RTT”) providing professional
high-end 3D visualization software, marketing solutions
and computer generated imagery services to extend the
Company’s offerings to marketing professionals;
(cid:96) Creation of a new brand, BIOVIA, dedicated to address
science-based industries, combining the acquisition of
Accelrys and the Company’s internal developments in
BioPLM;
(cid:96) Further broadening of the Company’s manufacturing
offerings with the Quintiq acquisition in operations planning
and optimization.
2015
(cid:96) Introduction of 3DEXPERIENCE R2015x, offering a simplifi ed
and improved user experience, with powerful enhancements
that signifi cantly increase productivity on premise as well as
on public or private cloud. In addition, R2015x introduces
groupings of applications called “roles”, to cover industry-
specifi c needs;
(cid:96) Dassault Systèmes completed the change of the legal status
of the parent company from that of a french public limited
company (société anonyme) to that of a European company.
The adoption of the status of European company (Societas
Europaea, SE) is refl ecting the international dimension of the
Company and its growing presence in Europe;
(cid:96) CATIA’s capabilities were expanded to further enhance its
coverage of complex mechatronics systems engineering,
10 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
with the acquisition of Modelon GmbH, an expert in “ready-
to-experience” content for systems modeling and simulation
which are strategic to transform the Transportation &
Mobility industry.
2016
(cid:96) 3DEXPERIENCE 2016x general availability was announced
on February 4, 2016.
For further information on acquisitions over the last three
years, see paragraph 1.2.2 “Investments”.
1.2.1.3 Dassault Systèmes’ Purpose
and Strategy
Dassault Systèmes’ corporate purpose is to provide business
and people with 3DEXPERIENCE universes to
imagine
sustainable innovations capable of harmonizing product,
nature and life.
A growing number of companies in all industry verticals are
evolving their innovation processes to imagine the future both
with, and for, their end-consumers. To meet this challenge,
it is vital to ensure collaborative work processes internally
and externally to the enterprise with designers, engineers,
researchers and marketing managers, as well as external ad
hoc participants because the innovation flow comes from
many directions. Enabling this flow unleashes the innovation
its 3DEXPERIENCE
potential. Dassault Systèmes, with
platform leveraging its V6 architecture, provides this “linkage”,
enabling its clients to create the value that their ultimate
consumers are seeking. The Company’s 3DEXPERIENCE
portfolio is designed to support 3D realistic virtual experiences
representing usage of future products, and is comprised of
social and collaborative applications, 3D modeling applications,
simulation
intelligence
and
applications.
applications,
information
For Dassault Systèmes to be able to help its customers
simulate the end-consumer experience, it is important to
have a complete understanding of the most critical business
needs of the industries in which its customers operate.
Therefore, Dassault Systèmes has adapted its organization to
provide a strong focus on the users of its software through
its brands structure, while at the same time, advancing the
understanding and development of the needs of its 12 target
industries through the combined action of its organization by
industry, sales channels and local geographic presence.
Dassault Systèmes has brought value to customers since
its inception in 1981 by providing solutions in 3D Design
for product creation, DMU for replacing physical mock-ups,
and PLM covering the product’s whole life, from design to
manufacture and service. Now Dassault Systèmes has crossed
into the next stage in its vision of the future: the 3DEXPERIENCE
era, where helping customers reach a new milestone in terms
of innovation for a greater end-user satisfaction, is the new
way of doing business.
1.2.2
Investments
The Company’s investments, both through expenditures on
its internal R&D efforts and through acquisitions, are closely
aligned with its strategic roadmap. The Company’s internal R&D
investments are the principal driver of its product innovations
and enhancements. In addition, with its expanded purpose
and Industry Solution Experiences strategy the Company is
growing its addressable market along two axes: (i) broadening
its offer to cover the key product disciplines of clients adding
upstream consumer insights to its core markets of design,
engineering, simulation and manufacturing, and extending
through to business planning and operations and point of sales
and end-consumer experiences; and (ii) expanding its market
coverage to address industries focused on the interaction of
business and people with nature (geosphere) and business and
people with life sciences (biosphere).
As a result, the Company has and will continue to evaluate
potential external investments complementing and extending
the business value it brings to industries, clients and users.
For further information, see paragraphs 1.2.1.3 “Dassault
Systèmes’ Purpose and Strategy” and 1.4.1.3 “Growth
Strategy”.
Acquisitions from 2013-2015
Well aligned with its expanded purpose and addressable
market vision introduced in 2012, Dassault Systèmes has been
in an active period of discussions with selected companies. On
a net cash basis, the Company’s investments in acquisitions
totaled €20.2 million in 2015, €952.9 million in 2014 and
€213.4 million in 2013.
systems
complex mechatronics
In 2015, Dassault Systèmes expanded CATIA’s capabilities
in
engineering,
acquiring Modelon GmbH, an expert in “ready-to-experience”
content for systems modeling and simulation which are
strategic for the transportation and mobility industry. With
this transaction, Dassault Systèmes reinforces its portfolio of
industry-leading content, applications and services used in
today’s age of experience.
During 2014 the Company invested €952.9 million on a
net cash basis to acquire companies in several key areas:
(i) addressing the life sciences where it introduced a new
brand, BIOVIA, based upon the acquisition of Accelrys and
the Company’s
in bio-intelligence; (ii)
addressing marketers with the RTT acquisition, rebranded as
3DEXCITE, which enables the reuse of virtual mock-ups or
3D product designs to create images, marketing brochures,
promotional films or virtual but very realistic show rooms;
internal research
Presentation of the Group
History
1
1
and (iii) addressing business operations management with
the acquisition of Quintiq, for supply chain, logistics and
workforce operations planning and optimization. In addition,
the Company strengthened the capabilities of its simulation
brand, SIMULIA with the acquisition of SIMPACK for multi-
body simulation.
In 2013, the Company completed seven acquisitions,
for a total net cash investment of €213.4 million, in
manufacturing, simulation and in urban modeling as follows:
in manufacturing where the Company significantly
(i)
expanded
its DELMIA offering with Apriso, providing
manufacturing operations management software solutions;
(ii) in analysis and simulation, further strengthening CATIA
and SIMULIA’s capabilities with SFE bringing a fully integrated
design-simulation approach to run simulations at an early
stage of concept design and shorten product development
time; FE-DESIGN bringing powerful design optimization
technology; SIMPOE for plastic injection molding simulation
and Safe Technology for fatigue simulation to evaluate
product durability; and (iii) in the automated creation and
management of urban cities and landscapes with Archivideo.
The Company’s principal acquisitions with an individual
purchase price greater than €100 million over the last three
years include:
Acquisition
Accelrys
Quintiq
RTT
Apriso
Year
2014
2014
2014
2013
Purchase Price
€542 million
€260 million
€191 million
€179 million
2014: Creation of the BIOVIA brand, addressing science-
based industries with the acquisition of Accelrys and the
Company’s internal BioPLM developments.
In April 2014, Dassault Systèmes completed the acquisition
of Accelrys, a leading provider of scientific innovation lifecycle
management software for chemistry, biology and materials
sciences industries, a publicly-traded company based in San
Diego, United States. BIOVIA provides a scientific collaborative
environment for biological, formulated products and advanced
materials to help science- and process-driven companies
develop better products faster and more cost-effectively in
regulated and non-regulated environments.
2014: Dassault Systèmes Extends 3DEXPERIENCE platform
to Global Business Operations Planning with Quintiq
Acquisition.
DASSAULT SYSTÈMES ANNUAL REPORT 2015 11
1 Presentation of the Group
Group Organization
In September 2014, the Company completed the acquisition
of Quintiq, a global leader in operations management and
optimization with offerings spanning notably production,
supply chain, logistics, and workforce management. Quintiq
further enriches the 3DEXPERIENCE platform capabilities
and enables a better support for the Company’s customers
in industries such as metals, mining, oil & gas, air transport
and rail, logistics and freight. Key reasons customers select
Quintiq’s solutions include: i) a single, integrated solution able
to solve operations planning puzzles; ii) a solution designed to
be 100% adaptable to each client’s unique business processes,
requirements and constraints; iii) KPI-based planning; iv)
superior performance results from record-breaking technology;
and v) seamless integration with existing IT infrastructure.
2014: Creation of the 3DEXCITE brand, following the
acquisition of RTT, extending the Company’s offerings to
address marketing professionals.
January 2014,
In
the Company acquired Realtime
Technology AG, a leading provider of professional high-end
visualization software, marketing solutions and computer
generated imagery services. Its customer base includes a
number of the world’s leading automotive companies as well
as global industry leaders in aerospace and consumer goods.
With 3DEXCITE’s solutions, companies are able to: i) more
closely link design and marketing domains thanks to very high
level of realistic 3D real-time visualization; ii) speed time from
design to sales thanks to the ability to conduct marketing all
along the product development cycle; and in turn, iii) derive
significant returns on investment over traditional marketing
methods.
2013: Broadening of the Company’s manufacturing offerings
to Manufacturing Operations Management
In July 2013 Dassault Systèmes acquired Apriso, a leading
provider of manufacturing operations management software
solutions, headquartered in Long Beach, California. Apriso
complements DELMIA’s application portfolio through its
manufacturing operations management capabilities and
expands DELMIA’s offer across multiple industries, such
as Consumer Goods & Retail, Consumer Packaged Goods &
Retail, High-Tech, Life Sciences, Transportation & Mobility,
Aerospace & Defense and Industrial Equipment. Key reasons
customers select DELMIA Apriso’s solutions
i)
flexibility to quickly adapt to customer environment while
driving best-in-class manufacturing; ii) standardization across
multiple plants to establish best practices; and iii) operations
monitoring to synchronize product releases across all
manufacturing operations.
include:
1.3 Group Organization
1.3.1 Dassault Systèmes SE’s Position within the Group
integrated
Dassault Systèmes SE, the Group’s parent company, fulfills
several roles: first, it is one of the Group’s largest operating
companies and one of its principal R&D centers, responsible
for the development of a number of the Group’s software
the 3DEXPERIENCE platform.
solutions
Dassault Systèmes SE also operates as a holding company as it
owns directly or indirectly all the companies that make up the
Group. Dassault Systèmes SE plays a centralizing role, defining
the Group’s overall strategy and the means for its deployment,
as well as the marketing and sales policy through the Group’s
three sales channels (described in paragraph 1.4.2.5 “Sales and
in
Marketing”). The parent company manages the Group’s cash
and financing needs centrally (“cash pooling”), and provides
support to the Group for a number of activities, including
finance, communication, marketing, legal affairs (including
management and protection of IP), human resources and IT,
and pools certain costs for its subsidiaries.
Dassault Systèmes SE receives dividends paid by
its
subsidiaries. Additionally, the costs of providing centralized
services are charged back to the respective subsidiaries
benefiting from support services and cost pooling, and it
receives royalties related to the IP it holds.
12 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Presentation of the Group
Group Organization
1
1.3.2 Principal Subsidiaries of the Company
At December 31, 2015, the Company included Dassault Systèmes SE and 118 operational subsidiaries, as compared to
128 operational subsidiaries in 2014. T he decrease was due principally to the effort of the Company to simplify the organization
of its legal entities throughout the world. The objective of this effort, which was launched in 2007, is to reduce the number of
legal entities held in each country.
1
The chart below sets forth the Company’s main subsidiaries.
Dassault Systèmes SE
Dassault Systemes Deutschland GmbH
(Germany)
Dassault Systemes Americas Corp.
(USA)
Dassault Systemes UK Ltd
(United Kingdom)
Dassault Systemes SolidWorks
Corporation (USA)
%
0
0
1
Dassault Systemes K.K.
(Japan)
100%
Dassault Systemes Korea Corp.
(South Korea)
Dassault Systèmes (Shanghai)
Information Technology Co., Ltd
(China)
Europe
Asia
Americas
Direct and indirect equity interest
See also Note 27 to the consolidated financial statements and the table of subsidiaries and shareholdings under Note 24 to the
parent company financial statements.
DASSAULT SYSTÈMES ANNUAL REPORT 2015 13
1 Presentation of the Group
Business Activities
1.4 Business Activities
1.4.1 Principal Activities
1.4.1.1
Summary
Dassault Systèmes, the 3DEXPERIENCE Company, provides
end-to-end software, content and services, designed to support
companies’ innovation processes. The Company’s software
applications and services encompass three principal spheres:
“Product-Sphere”, “Geo-Sphere” and “Bio-Sphere” reflecting
the Company’s expanded purpose to provide business and
people with 3DEXPERIENCE universes enabling to imagine
innovations capable of harmonizing product, nature and life.
Dassault Systèmes is the world leader of the global Product
Lifecycle Management market based upon end-user software
revenue (source: CIMdata, July 2015), a position which it has
held since 1999. Its world leadership reflects its core DNA as
a scientific company, combining science, technology and art
to help advance the success of customers and users with the
Company’s Industry Solution Experiences.
Dassault Systèmes software offerings address users all across
a company’s product development loop enabling the Group
to provide companies with a comprehensive perspective,
encompassing:
(cid:125) product idea and specification;
(cid:125) design with early 3D digital models to full digital mock-ups;
(cid:125) virtual testing of products;
14 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
(cid:125) virtual
production
and manufacturing
operations
management;
(cid:125) operations planning and optimization;
(cid:125) digital marketing and sales;
(cid:125) end-consumer shopping experience.
Dassault Systèmes has a diverse customer base, working with
the smallest manufacturers in the world to global leaders,
and includes companies in 12 vertical sectors: Aerospace &
Defense; Transportation & Mobility; Marine & Offshore;
Industrial Equipment; High-Tech; Architecture, Engineering &
Construction; Consumer Goods & Retail; Consumer Packaged
Goods & Retail; Life Sciences; Energy, Process & Utilities;
Financial and Business Services; and Natural Resources.
See paragraph 1.4.2.2 “3DEXPERIENCE Industries Served”.
1.4.1.2
Key Strengths of Dassault Systèmes
Dassault Systèmes, the 3DEXPERIENCE Company, has the
mission to provide business and people with 3DEXPERIENCE
universes to imagine sustainable innovations harmonizing
product, nature and life. Its world leading solutions transform
the way products are designed, simulated, produced, marketed
and supported, leveraging the virtual world to improve the real
world.
its current horizon,
In 2012, the Company unveiled
3DEXPERIENCE, based on the Company’s technology
architecture Version 6 (“V6”) and designed to support its
clients in their innovation process so that they can invent the
future of their users’ experiences. 3DEXPERIENCE builds upon
the Company’s work in 3D, DMU, and PLM, and reflects the
evolution Dassault Systèmes began to see among its clients
in different industry verticals. It can be used on premise or
online, in a public or private cloud.
The Company is positioned to work with companies from
ideation to consumer experience and across departments
from research and development, engineering, testing,
manufacturing, governance to marketing and sales. The
Company believes its global market leadership and financial
performance benefit from key characteristics of the Company.
Dassault Systèmes is a scientific company serving science,
technology and art for a sustainable society.
Presentation of the Group
Business Activities
1
1
The Company’s DNA to model and represent as scientifically
accurate as possible products, nature and life has given birth
to a unique portfolio of products and Industry Solutions
whose key strength is in their scientific content and deep
understanding of industrial processes. This applies to a wide
spectrum of applicative domains from modelling and scientific
simulation to production and logistics optimization, applicable
from Natural Resources to Cities, Transportation, Buildings,
Smart Products, Consumer Goods, all the way to biological
systems and chemistry.
Dassault Systèmes has a substantial commitment to
technological innovation which has enabled it to define
and create new markets, expanding from 3D Design to
Digital Mock-Up, to Product Lifecycle Management and now
3DEXPERIENCE.
A key component to advancing the Company’s technology
and enabling it to define and create new markets is the close
relationship it has with its customers, including partnerships
with customers who are global leaders in their respective
industries, and the input the Company solicits from the
day-to-day users of its software. The Company works closely
with customers, involving them in many phases of product
development. Through these close,
long-term working
relationships, the Company develops a good understanding
of its customers and their most important business values.
This level of knowledge enables the Group to develop
software solutions more closely attuned to the customers’
requirements, highly suited to their industries, and designed
to maximize user productivity and experience.
Dassault Systèmes maintains a long-term focus, well
supported by its financial model with a high level of
recurring software revenue.
One of the key reasons for the Company’s market share
leadership over the last sixteen years is its focus on a
long-term vision which is characterized by investing in people
and its long-term financial model. The Company has a diverse,
highly-educated workforce which totalled 13,974, and
represented an estimated 123 nationalities. The Company’s
long-standing financial model, with a high level of recurring
software revenue, representing 70% of the Company’s
total non-IFRS software revenue in 2015, has enabled the
Company to maintain as well as increase investments in
critical resources in R&D and customer support even during
challenging macroeconomic environments.
Dassault Systèmes’ 3DEXPERIENCE software applications,
comprised of leading market brands, have been integral to
the Company’s success and continue to be principal areas of
R&D investment.
The Company’s 3DEXPERIENCE portfolio is designed to
support 3D realistic virtual experiences representing usage of
future products, and is comprised of 3D modeling applications,
simulation applications creating virtual twins of products or
production systems, social and collaborative applications, and
information intelligence applications. The Company’s brand
strategy (see paragraph 1.4.2.4 “3DEXPERIENCE Software
Applications Portfolio – Addressing the Needs of its User
Communities”) focuses on providing significant value to
end-users with the objective of each brand/product line being
a leader within its respective markets. In support of its “Social
Industry Experiences” strategy, the Company packages its
applications and user roles in Industry Processes chosen
because of their business relevance in each of the 12 industries
the Company targets.
The Company is benefiting from a sophisticated organization
supporting its multiple growth drivers.
In connection with the Company’s 3DEXPERIENCE strategy
and reflecting its broadening software applications capabilities,
the Company has organized itself along three axes: (i) a strategy
to cover customer processes based upon an industry-focused
set of offerings, “Industry Solution Experiences” based upon
the Company’s underlying software applications portfolio,
content and services; (ii) a domain-focused group of software
applications organized by brand in order to ensure a strong
focus on the satisfaction of end-user needs; and (iii) a
global-local-specialized organization in order to leverage its
global strengths, while at the same time ensuring a strong
local understanding and field operations.
The Company believes the structure of its sales, well-
balanced between its direct and indirect sales channels has
enabled it to have a broad market reach.
For marketing and sales, the Company operates through
both a direct sales force and indirectly through value-added
resellers, with total sales well balanced between direct and
indirect sales channels. It continues to selectively expand
and extend its sales radius, deepen its industry expertise and
relationships, as well as domain or discipline knowledge of its
three sales channels.
Dassault Systèmes has had a long history of partnering,
leading to the development of a resilient and dynamic
ecosystem of partners, including software development,
education and research and technology, and system
integrators.
Since inception the Company has worked in close partnership
in software development and
with other professionals
technology, in sales and marketing, in services and in education
and research. The Company is also expanding its relationships
with system integrators with strong industry expertise and
regional presence for both sales and service engagements.
Moreover, the Group is engaging with its ecosystem, working
with more than 400 software development partners building
applications complementing its software applications as well
as working with key technology partners. Looking to the
DASSAULT SYSTÈMES ANNUAL REPORT 2015 15
1 Presentation of the Group
Business Activities
future, Dassault Systèmes has had long-standing commitment
and growing connections with academic, research and now
medical organizations around the world, working to use 3D
to enable an improved learning environment for students
throughout the world and to collaborate in accelerating the
creation of new software dedicated to help the digital world
improve the real world.
1.4.1.3 Growth Strategy
Dassault Systèmes principal growth opportunities reflect
its current addressable market opportunity in PLM and the
increased potential size of its addressable market, estimated
at approximately $32 billion, with the expansion of its market
to 3DEXPERIENCE. The Company’s growth strategy is focused
on:
(cid:125) users expansion in its core industries: the Company sees
opportunities to expand the number of users of its software
solutions within its core industries through diversification
by addressing new disciplines and new segments. Within
a corporation, the Company’s applications now target
a large portion of the enterprise employees engaged in
contributing to the end-consumer product experience,
spanning from design, engineering and simulation, to
manufacturing, quality assurance and compliance, and from
project management, business planning & operations and
service departments to marketing, point of sales. For further
information see paragraph 1.4.2 “Principal Markets”;
(cid:125) diversification of its industry coverage: through its focus
on developing industry specific solutions for the 12 vertical
industries it addresses, including its Industry Solution
Experiences and processes, the Company sees opportunities
to expand its presence and has developed industry solutions
to further its progress in each of the industrial sectors it
targets. For further information, see paragraph 1.4.2.2
“3DEXPERIENCE Industries Served”;
(cid:125) deepening of its regional market penetration: the Company
sees opportunities to grow its presence in all geographic
markets. In order to strengthen and broaden its global
footprint, the Company has established 12 regional field
organizations to prioritize and drive the Company’s growth
initiatives at a local level. See paragraph 3.1.1.1 “Executive
Overview for 2015” for further information on growth by
geographic region;
(cid:125) availability of on premise solutions, on the cloud, and
mobile applications: with the Company’s 3DEXPERIENCE
platform utilizing a cloud-enabled V6 architecture, the
Company is positioned to grow through its Cloud and
Mobile offerings. The Company believes that it will become
a growth driver with the progressive roll-out of its services
offering over the coming years, as well as with the release
of mobile applications using tablets because of the quick
implementation time and the reduction in total cost of
ownership it provides to customers. For further information
see paragraph 1.4.1.4 “Technology and Science”;
(cid:125) expanding through targeted acquisitions: in 2012, the
its next horizon, 3DEXPERIENCE,
Company unveiled
representing a potential doubling of its addressable market,
expanded its purpose and outlined a new strategy. Aligned
with its strategy, the Company is complementing its internal
developments with key selected acquisitions. For further
information see paragraphs 1.2.2 “Investments”, 1.4.1.4
“Technology and Science” and 1.4.2 “Principal Markets”.
For a description of the challenges that must be met to
maintain growth, see paragraph 1.6.1 “Risks Related to the
Company’s Business”.
1.4.1.4
Technology and Science
Dassault Systèmes has a substantial commitment to
technological innovation. Important areas of investment in
R&D include, among others, the business 3DEXPERIENCE
platform foundations and services, Modeling Technologies
(3D, systems engineering, natural resources and biosystems),
technologies for product, production and usage realistic
simulation, intelligent information technologies (indexing,
dashboarding and also project management and compliance)
and connectivity technologies (for social and structured
collaboration). Moreover, the Company’s R&D efforts are
centered on advancing breakthrough user experiences, and
expanding the reach of its solution with native cloud and
mobility solutions.
3DEXPERIENCE business platform, based on the V6 organic
architecture
Since 1981, the Company has
introduced six versions
of its architecture, the most recent of which is V6. The
V6 software architecture is the foundation of the revolutionary
3DEXPERIENCE Industry Solutions that offer end-to-end and
integrated scientific, engineering, marketing, manufacturing
and business capabilities and services. This is a unique holistic
business-oriented platform.
These solutions are based upon 3DEXPERIENCE platform
offering the following capabilities:
(cid:125) 3D Dashboarding Technologies and Services: The
3DEXPERIENCE platform provides capabilities to dashboard,
monitor and summarize all enterprise and business
activities. With semantics and mass tagging technologies,
the platform provides unique ways of compassing any
businesses with real-time streamed media and information
in a context-aware, managed and intuitively-experienced
fashion;
(cid:125) Social Collaboration Technologies and Services: The
3DEXPERIENCE platform allows any business to become
social, extending from structured project and organization
16 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Presentation of the Group
Business Activities
1
1
to social and open communities. The technology and
services allow seamless integration of communities, people,
rich profiles and media with access control and best of breed
practices (project management, ideation, wikis, blogs,
suggestion engines);
(cid:125) Technologies and Services for Enterprise Data and Assets:
The 3DEXPERIENCE platform integrates Dassault Systèmes’
brands and industry offerings, with the semantic breadth
representation and deepness to handle any kind of data and
corporate Intellectual Property for any product, nature or
life data sets. These dedicated technologies and services
help enable unique experiences for social industries in terms
of modeling, lifecycle management and data protection for
all social industries;
(cid:125) Cloud Technologies and Services: The 3DEXPERIENCE
platform provides cloud-based workspaces services and
technologies to enable secured, concurrent, and controlled
online collaborative environments to share, and innovate on
any IP. This technology is unique, optimized for big data
and available for remote usage for a wide variety of industry
practices;
(cid:125) Experiences Play Technologies and Services: The
3DEXPERIENCE platform aims at providing real-time,
realistic 3D experiences. The Play Technologies and Services
deliver unmatched visualization, execution, interactivity,
and scenarios experience in heterogeneous virtual universes.
3D Modeling Technologies
The Company’s DNA to model and represent as scientifically
accurate as possible products, nature and life has given birth
to a unique portfolio of modeling technologies and services
ranging from 3D Modeling to Systems Logical and Functional
Modeling. This applies to a wide spectrum of applicative
domains from Smart/Connected Products to urban systems,
to natural resources, to biological systems and chemistry.
Virtual + Real Technologies
The 3DEXPERIENCE is made possible by real-time realistic
simulation of virtual universes. The Company has therefore
made significant investments in technologies and services,
enabling simulation
from product’s complex
behaviors; factory and production systems execution; additive
manufacturing; logistics operations and consumer usages
in everyday life. This relies on unique assets for complexity
management and distributed massive multi-discipline
execution.
ranging
Intelligent Information Technologies
Thanks to Exalead’s unique technologies, the Company has
significantly expanded its indexing and search capabilities
technology and acquired an
important search-based
infrastructure for the development of information intelligence
applications. The Company’s search-based applications
combine the sophisticated search and access typically
associated with databases with the speed, scalability and
simplicity of the Web. This allows the 3DEXPERIENCE platform
customers to tackle big data challenges and benefit from next
generation technologies to search, sort, filter, navigate and
understand data. The real-time dashboarding technologies
provided by Netvibes are in that regard a unique combination
for all businesses consuming and producing massive sets of
information.
Connectivity Technologies
The 3DEXPERIENCE platform is serving the social industry
experience strategy. With unique connectivity technologies
and services, allowing people and communities to connect in
a secure and controlled environment, with mobility and online
hybrid environments, it enables a new era of innovation on
extended ecosystems and fosters a truly open platform
innovation for all businesses. It also enables improved project
management, conformity to standards, process certification
for customers and supply chain relationships.
Software, Technology and Science Partners
The Company has established
long-standing, technical
collaborations with key partners in order to maximize the
benefits from available technology and to increase the value
for shared customers. The Company’s technology alliances are
established with three objectives: to cover end-to-end solutions
with holistic offerings; to participate to the future structure
of industries; and to integrate the most advanced features
of these technologies into its solutions. Further, Dassault
Systèmes is a participant in several hundred public-private
projects (for example with DARPA, Harvard, INRIA, INSERM,
MIT), collaborates with renowned scientists (including Nobel
Prize winners) and is engaged in technology partnerships
across the 12 industries (and industry sub-segments) it serves.
Finally, the Company has software development partners
working in each domain of its software solutions. The
Company’s global affiliate program enables developers to
create and market their own applications fully integrated with
and complementary to the Company’s software solutions.
DASSAULT SYSTÈMES ANNUAL REPORT 2015 17
1 Presentation of the Group
Business Activities
1.4.2 Principal Markets
1.4.2.1 Overview
In connection with the Company’s 3DEXPERIENCE strategy
and reflecting its broad software applications capabilities, the
Company has organized itself along three axes: (i) a strategy
to cover customer processes based upon an industry-focused
set of offerings, “Industry Solution Experiences” based upon
the Company’s underlying software applications portfolio,
content and services; (ii) a domain-focused group of software
applications organized by brand in order to ensure a strong
focus on the satisfaction of end-user needs; and (iii) a
global-local-specialized organization in order to leverage
its global strengths, while at the same time ensuring a
strong local understanding and field operations. See also
paragraph 1.4.1.3 “Growth Strategy”.
1.4.2.2
3DEXPERIENCE Industries Served
The Company’s global customer base includes companies in
12 industrial sectors: Aerospace & Defense; Transportation &
Mobility; Marine & Offshore; Industrial Equipment; High-Tech;
Architecture, Engineering & Construction; Consumer Goods &
Retail; Consumer Packaged Goods & Retail; Life Sciences;
Energy, Process & Utilities; Financial & Business Services; and
Natural Resources.
For its latest full fiscal year 2015, the composition of end-user
software revenue by major industry was approximately as
follows: Transportation & Mobility about 32% (30% in 2014);
Industrial Equipment about 15% (19% in 2014); Aerospace &
Defense about 14% (12% in 2014); Business Services about
9% (11% in 2014); Diversification Industries about 30% (28%
in 2014).
In connection with the Company’s change in its go-to-market
strategy evolution from brands to industries commencing in
2012, began the introduction of ‘Industry Solution Experiences’
which are designed to address key business processes of the
respective individual industry and are comprised of industry
process experiences.
To deepen its penetration of each industry, the Company
undertakes the continuing development of industry-specific
internal development and by
solutions, both through
acquisition, and increasing its expertise through partnerships
with leading companies and system integrators and the
addition of specialized direct sales and sales partners.
Through strategic alliances with leading IT system integrators,
service providers and consulting firms with deep expertise
in industry processes, the Company’s Industry Solution
Partnerships provide innovative solutions and services by
industry or industrial segment to address clients’ business
challenges. Based on their strong competence in industries
and application domains as well as their regional expertise, in
conjunction with Dassault Systèmes’ products and solutions,
these partners help to deliver innovative solutions that
customers need for success in their business.
See paragraph 1.2.2 “Investments”.
1.4.2.3
3DEXPERIENCE Industry Solutions
The 3DEXPERIENCE platform
is a business experience
platform. It provides software solutions for every organization
within a company – from engineering to marketing and sales
– that help clients, in their value creation process, to create
differentiating consumer experiences. With a single, easy-
to-use interface, the 3DEXPERIENCE platform, available on
premise and on cloud, powers Industry Solution Experiences
– based on 3D design, analysis, simulation, and intelligence
software in a collaborative, interactive environment.
industry-leading applications
Dassault Systèmes offers
the 3DEXPERIENCE platform: Design &
delivered on
Engineering, Manufacturing & Production, Simulation,
for
Governance & Lifecycle, 3D Design Experience
Professionals, and number of solutions and processes. The
3DEXPERIENCE platform and industry solution experiences on
premise and on cloud were first introduced in February 2014.
The 3DEXPERIENCE Process Portfolio On Cloud is offered as
Software as a Service (SaaS) on a public or private Cloud to
provide increased flexibility and fast deployment. In addition
to offering the same software applications which are also
available on premise for a broad portfolio of Processes and
Roles, it includes the operation of the Cloud environment
in the price of the Processes. The public cloud operates
permanently, and
licensing, and
upgrades. Total Cost of Ownership is improved by reducing
requirements for computing and storage, as well as facility
and human resources costs.
includes maintenance,
A single user interface – the 3D Compass – provides easy-to-use
navigation, search, and collaboration in the 3DEXPERIENCE
platform environment that is extensible to any discipline in
a company – engineering, manufacturing, simulation, sales,
marketing, finance, procurement, and management.
The V6 architecture unifies the user experience for all Processes
and Industries. Built to answer customer and industry specific
needs for ease of use and lower training costs, it allows
customization and the integration of customer data into
a single environment. It provides a single source for truth
by integrating all data required to improve processes while
eliminating costly IT operations, such as database replication.
See paragraph 1.4.1.4 “Technology and Science”.
18 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
1.4.2.4
3DEXPERIENCE Software
Applications Portfolio – Addressing
the Needs of its User Communities
The Company’s 3DEXPERIENCE software applications portfolio
is designed to enable the powering of 3D realistic virtual
experiences and is comprised of 3D modeling applications,
simulation applications, social and collaborative applications,
and information intelligence applications.
Since its inception, the Company has focused on creating a
portfolio of leading brands, each focused on specific user
groups. The Company continues to expand its brands and
create new brands to meet the evolving needs of existing
and new users across its expanded addressable market and,
in addition, began introducing in 2012 Industry Solution
Experiences. These solutions are designed on an industry-by-
industry basis, and are designed to trigger and connect the
value created by each discipline in an industry to ensure that
the Company value stream is not interrupted.
Dassault Systèmes’ investments in research and development,
as well as targeted acquisitions, enable the Company to
deepen and broaden its offerings for customers as well as to
bring its significant assets to help advance innovation in other
target domains and industries. These investments advance the
Company’s brand portfolio and have led to the introduction
of new brands. In 2014 the Company introduced two new
brands: (i) BIOVIA, focused on science driven industries to help
them introduce scientific innovation in the biologic, chemical
and material sciences; and (ii) 3DEXCITE, focused on helping
companies across core and other industries create marketing
materials from virtual product representations.
Presentation of the Group
Business Activities
1
1
3D Modeling Applications
SOLIDWORKS – Authentic Designer Experience
SOLIDWORKS applications cover all aspects of the product
development process with a seamless, integrated workflow
for design, simulation, technical communication and data
management. Designers and engineers can span multiple
disciplines with ease, shortening the design cycle, increasing
productivity and delivering innovative products to market
faster.
SOLIDWORKS software applications are easy to learn and use
and work together to help professionals to design products
better, faster, and more cost effectively. The SOLIDWORKS
focus on ease of use allows more engineers, designers and
other technology professionals than ever before to take
advantage of 3D in bringing their designs to life.
SOLIDWORKS applications include 3D tools to design, manage,
simulate and communicate.
(cid:125) 3D Design: 3D design applications for rapid creation of
parts, assemblies, and 2D drawings with minimal training.
Application-specific tools for sheet metal, weldings,
surfacing, and mold tool and die make it easy to deliver
best-in-class designs.
(cid:125) Data Management: SOLIDWORKS product data management
(“PDM”) applications help professionals to get design data
under control and substantially improve the way teams
manage and collaborate on product development.
(cid:125) Simulation: SOLIDWORKS offers a comprehensive suite
of simulation applications to set up virtual real-world
environments to test product designs before manufacture.
Tests can be conducted against a broad range of parameters
during the design process – like durability, static and
dynamic response, motion of assembly, heat transfer, fluid
dynamics, and plastics injection molding.
(cid:125) Technical documentation: SOLIDWORKS Composer allows
users to easily repurpose existing 3D design data to more
rapidly create and update high quality graphical assets for
product deliverables, including documentation, technical
illustrations, animations, and interactive 3D experiences.
(cid:125) Electrical Design: SOLIDWORKS Electrical applications
provide a range of electrical system design functionality to
meet the needs of design professionals. All project design
data is synchronized with real-time, bi-directional updates
between schematics and the 3D model. Powerful schematic
design tools quickly develop embedded electrical systems
for machines or products.
DASSAULT SYSTÈMES ANNUAL REPORT 2015 19
1 Presentation of the Group
Business Activities
In February 2015, SOLIDWORKS Industrial Design was
introduced, the second SOLIDWORKS application to be
available on the 3DEXPERIENCE platform, following the
launch in 2014 of SOLIDWORKS Conceptual Design. It provides
social design capabilities and transparent data management
that allow engineers and designers to quickly solve industrial
design challenges and easily transition to mechanical design.
Safe, secure, intelligent data storage on the cloud can be
accessed anytime from anywhere to share designs, collaborate
on ideas, save and evaluate multiple concepts.
In addition to the products it offers to SOLIDWORKS users,
SOLIDWORKS operates a development partnership program
bringing together companies supplying complementary
products that are either compatible with or tightly integrated.
Through this program, over 300 compatible products have
been made available to customers in many functional areas,
including manufacturing, rapid prototyping and mold design.
CATIA – Shape The World We Live In
“CATIA is Dassault Systèmes’ pioneer brand and the world’s
leading solution for 3D product design and innovation”
(source: CIMdata, July 2015).
CATIA addresses the complete experience development &
innovation process, from the early concept definition to
delivering interactive virtual product experiences. Providing
innovators with “state of the art” user experiences, the
Brand complete portfolio covers from design to engineering,
and from styling to systems modeling, within a “3D Virtual
Twin” experiencing Environment. CATIA shifts traditional
3D CAD (Computer Aided Design) expectations, delivering
high-end solutions adapted to imagine and shape a human
centric connected world. In alignment with its mission, CATIA
proposes the capacity to design products in context of its
intrinsic usage, ultimately enabling innovator communities to
virtually experience and share their vision.
CATIA 3DEXPERIENCE delivers:
(cid:125) a social design environment driving product experience
innovation, providing real collaborative features;
(cid:125) an instinctive user experience, powered by state of the art
and intuitive 3D modeling functionalities;
(cid:125) an
inclusive experience development platform, easily
integrated with both modern and legacy tools, enabling all
relevant communities to participate to the design process.
(cid:125) CATIA Design: Delivering Advantage by Design
Successful product designs evoke positive emotional
responses from their consumers. Creative designers need
software solutions that enable them to easily craft such
products, while collaborating with engineering on the same
functional scope. CATIA addresses the entire shape design,
styling, and surfacing workflow, from Creative & Industrial
Design to Class-A surfacing and Creative Experience. Intuitive
shape design solutions deliver flexibility to simplify the design
of any kind of complex shape, with advanced functionality
like reverse engineering, real-time diagnostics, unified surface
modeling, rapid propagation of design changes, and high-end
visualization. CATIA enables creative designers, design
studios, and engineering departments to easily collaborate
and optimize both product aesthetics and engineering aspects
concurrently.
(cid:125) CATIA Engineering: Engineering Excellence
CATIA Engineering enables the creation of any type of
3D components assemblies for all engineering processes. It
addresses the requirements of a complete range of industries
and processes, covering from cast and forged parts, to plastic
injection & molding operations, up to composites part design
and manufacturing, sheet metal parts design or even advanced
fastening operations. Engineers rely on CATIA 3D Modeling
capabilities to define complete mechanical products, including
functional tolerances, 3D annotations as well as kinematics.
Highly adapted roles in CATIA empower engineers to deliver
greatly improved productivity, not only during mechanical
design completion, but also when performing design changes
for new releases.
(cid:125) CATIA Systems Engineering: Mastering Cross-discipline
Systems Development
Within a dramatically
increasing connected world, the
complexity of embedded systems continues to grow. The
definition, modelling and simulation of individual systems,
as well as their interaction with other systems, are becoming
definitely strategic. Systems Engineering is essential to avoid
detecting unexpected system interactions during the validation
and verification phases of the product development process.
CATIA Systems Engineering delivers complete portfolio fully
supporting cross-discipline systems engineering including
Electrical and Fluidic systems, covering from systems
definition up to modeling, simulation, and verification. Within
this solution, CATIA provides unified and integrated approach
to systems engineering that manages the overall development
process of cross discipline definition of the many relationships
existing between different systems artifacts that are defining
today’s complex products.
20 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Presentation of the Group
Business Activities
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GEOVIA – Virtual Planet
GEOVIA provides b usiness, g overnment and i ndividuals with
3DEXPERIENCE Universes to model and simulate the Earth
from the vast expanse of the geosphere to the smallest details
of urban settlements.
The dramatic increase of the world’s urban population affects
the entire planet, causing a rapid change in the geosphere,
and a limited availability of global resources.
GEOVIA supports the sustainable capture, use and re-use of
natural resources across the planet, including minerals, fresh
water, air, oil and gas, and various other forms of energy.
From mining to urbanization, GEOVIA delivers innovations to
improve people’s life.
Mining
In mining, GEOVIA’s customers are increasing productivity,
efficiency, and safety during the identification and extraction
of natural resources. At the same time, they are also achieving
a greater level of production predictability and sustainability.
With GEOVIA, geologists, mining engineers, operations
managers, and executives improve how they model, plan,
optimize and understand mining performance to increase
profitability.
GEOVIA’s software spans all mining phases,
including:
exploration and evaluation; mine planning; optimization; and
mine production. Its applications include:
(cid:125) Geology and Mine Planning: GEOVIA Surpac, GEOVIA GEMS,
and GEOVIA Minex enable mineral deposits to be modeled
and their extraction to be designed and planned in 3D;
(cid:125) Optimization and Scheduling: GEOVIA Whittle links business
strategy to mine optimization by examining the viability of
mineral deposits in consideration of mine designs, mining
equipment, and economic factors. Other applications are
used to schedule mine production or for block cave mines;
(cid:125) Secure, Remote Collaboration: GEOVIA Hub provides secure
remote collaboration that organizes, centralizes and enables
the reliable sharing of exploration, planning, and production
data over low-bandwidth connections;
(cid:125) Mine Production Management: GEOVIA InSite increases
the confidence in a company’s operations’ ability to meet
production targets, manage costs, and improve efficiencies
to deliver expected results to stakeholders.
Cities
During 2014 the Company unveiled GEOVIA 3DEXPERIENCity,
with the objective to help potential clients improve the quality
of life for the citizens by creating better urban environments
for today and tomorrow. With 3DEXPERIENCity, urban
planners work in a virtual world to model and simulate the
cityscapes and all components making up a city to improve
its functions.
GEOVIA 3DEXPERIENCity creates unique user experiences
that holistically model and analyze all parts and processes
constituent to urban life in the geosphere.
Within the geosphere, human activities continuously relocate
resources. In particular, urban settlements are aggregations
and condensation points capturing, using, and reusing the
planet’s natural resources. Consequently, the effects of
urbanization are not limited to the city, but rather affect the
entire geosphere, the entire planet.
Through 3D simulation, the future can be displayed, by
actively involving government, business, and individuals to
facilitate critical decision-making processes with the aim to
harmonize product, nature and life.
BIOVIA – Virtual Biosphere and Materials
BIOVIA provides a scientific collaborative environment for
biological, formulated products and advanced materials to
help science- and process-driven companies develop better
products faster and more cost-effectively in regulated and
non-regulated environments. BIOVIA solutions are used
by more than 2,000 customers in the pharmaceutical and
biotechnology, chemicals, consumer packaged goods, food
and beverage, energy, high-tech, transportation and mobility
and aerospace industries and in academic/government sectors.
The following BIOVIA solution areas integrate the diversity
of scientific and experimental processes, information and
compliance requirements across research, development, QA/
QC (Quality Assurance and Quality Control) and manufacturing
domains:
(cid:125) Collaborative Science – faster discovery and innovation by
leveraging multi-disciplinary collaboration and knowledge-
based understanding, as well as modelling/simulation and
predictive science;
(cid:125) Unified Lab Management – optimized lab operations by
managing all laboratory workflows and resources as well
as supporting information sharing and collaboration within
and between laboratories, internally and externally;
DASSAULT SYSTÈMES ANNUAL REPORT 2015 21
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Business Activities
(cid:125) Process Production Operations – providing real-time, on-
demand data access, analysis and reporting of quality and
process data to optimize manufacturing processes and
outcomes globally and throughout the wider ecosystem;
(cid:125) Quality and Regulatory Management – supporting
regulatory and quality operations to ensure compliance
and reduce operational risk in life sciences and other highly
regulated industries.
BIOVIA’s vision is to allow organizations to collaborate more
effectively by managing and sharing scientific information
across the value chain from research to commercialization,
internally and externally, with the supply chain and partners.
By managing and sharing information down to the molecular
level, scientists can better understand chemical, biological and
new material substances.
Integrating BIOVIA’s suite of scientific informatics solutions
with Dassault Systèmes’ 3DEXPERIENCE platform will create
significant opportunities for BIOVIA in terms of collaboration,
project management, data and content reuse, traceability
and other processes, applications and integrations that are
absolutely critical to science-driven industries.
Content and Simulation Applications
SIMULIA – Simulation for Product, Nature and Life
SIMULIA helps engineers and designers perform realistic
virtual testing to provide simulation for product, nature, and
life – from Products such as simple parts to entire airplanes,
to Nature such as volcano magma chambers and oil reservoir
geomechanics, to Life such as Dassault Systèmes’ Living Heart
Project and Virtual Human initiative.
As an integral part of the Dassault Systèmes 3DEXPERIENCE
platform, SIMULIA’s applications accelerate the process of
evaluating the performance, reliability, and safety of materials
and products before committing to physical prototypes. The
Company’s global team of simulation experts helps customers
meet their education, research, and development needs.
SIMULIA has expanded its technology applications through
recent acquisitions to
include multiphysics simulation;
multiscale simulation; optimization; and simulation process,
data and
lifecycle management. SIMULIA’s technology
portfolio includes Abaqus, fe-safe, Isight, Simpack, Simpoe-
Mold, and Tosca.
Multiphysics Simulation
(cid:125) Structural Analysis (Finite Element Analysis): Analyze two
or more interacting physical phenomena within a virtual
prototype such as fluid-structure interaction, structural-
acoustics, thermal-electric, and thermal-fluid-mechanical,
among others.
(cid:125) Computational Fluid Dynamics (CFD) Analysis: Gain deeper
understanding of how fluids and gasses flow through or
around products or systems, such as piping, valves, and
human blood vessels.
(cid:125) Plastic Injection Simulation: Predict and avoid manufacturing
defects during the earliest stages of part and mold design.
Also simulate the filling and packing phases, clamping
forces for tools, and cooling of molds and parts, as well as
many others.
(cid:125) Durability and Fatigue: Analyze structural failure and life
expectancy due to repeated or random loading cycles.
Also analyze fatigue life and crack locations in metals,
elastomers, and welded joints.
Multiscale Simulation
(cid:125) Multibody Dynamics: Generate and solve virtual 3D models
to predict and visualize motion, forces, and stresses,
into the
including high-frequency transient analyses,
acoustic range and complex nonlinear models with flexible
bodies and harsh shock contact.
Optimization
(cid:125) Parametric Optimization: Manipulate and map parametric
data between process steps and automate multiple
simulations to greatly improve efficiency, reduce manual
errors, and accelerate the evaluation of product design
alternatives.
(cid:125) Topology Optimization: Create
lightweight, ready-to-
manufacture product designs and reduce time-to-market,
physical tests, and prototype builds.
Simulation Process, Data, and Lifecycle Management
Simulation and test data management enable to simplify the
capture- and deploy-approved simulation methods, automate
standard simulation processes, collaborate on performance-
based decisions, and manage and secure simulation-generated
intellectual property.
DELMIA – The World of Value-Making
An integral part of the Dassault Systèmes 3DEXPERIENCE
platform is the connection between the virtual and real worlds.
Operational excellence requires harmony across design,
production, distribution, human resources management
and processes. DELMIA enables the design and testing of
products in a simulated production environment, and then to
plan, execute, manage and optimize resources and customer
delivery.
22 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Presentation of the Group
Business Activities
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1
DELMIA Digital Manufacturing solutions drive manufacturing
innovation and efficiency by digitally planning, simulating,
and modeling global production processes. DELMIA allows
manufacturers to virtually experience their entire factory
production. These simulation activities allow manufacturers
to better address and shift processes so as to quickly respond
to the competition, or to take advantage of new market
opportunities.
improve visibility
Moreover, DELMIA Manufacturing Operations Management
solutions help
into, control over and
synchronization across manufacturing operations and supply
chain processes on a global scale. The end result is improved
agility and expanded continuous improvement across the
enterprise and extended global supply chain. Manufacturers
leverage DELMIA solutions to establish a common set of
operational processes that can be managed holistically.
Further, for better performance and higher profitability,
Quintiq powers planning, scheduling and optimization for
complex processes across all planning horizons. It enables
customers to build on their competitive differentiators and
plan for profit by capturing their operational reality – down to
the last significant detail. This enables customers to integrate
supply chain planning and optimization to plan their workforce,
manufacturing environment, and logistics operations.
3DVIA – 3DEXPERIENCE for All
3DVIA provides Brands & Consumer Communities, with
engaging 3D Universes enabling the co-creation of personal &
personalized experiences.
3DVIA enables consumers to virtually create and experience
their personal projects in both a fun and social way. With
HomeByMe’s online service, consumers can find inspiration
from thousands of other projects, create their own concepts
or simply visualize ideas using dedicated online experience.
Within HomeByMe, top designers, brands and retailers
propose their full catalogues in a myriad of colors and materials
allowing the user to create and review their unique customized
home experience.
Social and Collaborative Applications
ENOVIA – Collaborative Innovation
ENOVIA enables companies to bring together people,
processes, content and systems involved in product creation,
development, introduction and maintenance.
ENOVIA offers a rich portfolio of collaborative enterprise
business process applications that leverage the 3DEXPERIENCE
platform and facilitate business processes orchestration.
ENOVIA applications by business themes include:
(cid:125) Product Planning and Programs: ENOVIA’s applications for
Program and Project Management, Contract Management,
and Design History File Management for regulatory
compliance processes address the need for informing and
monitoring enterprise-wide critical PLM business processes
leveraging invisible governance;
(cid:125) Strategic Customer Relationships: ENOVIA’s customer
relationship portfolio enables users to manage and
leverage requirements, manage the product to be delivered,
understand customer needs, and define point of sale
experience using 3DMerchanding. These products help
companies transform from designing products to creating
customer experiences;
(cid:125) Global Product Development: ENOVIA’s applications
eliminate costly product development errors by enhancing
collaborative innovation among the product development
stakeholders. Designers, product engineers, manufacturing
professionals and others collaborating on product
development are able to innovate leveraging bill of materials,
enterprise change management, multiple computer aided
technologies environments, management and systems
engineering;
(cid:125) Strategic Supplier Relationships: ENOVIA’s users in supplier
management, supplier quality, procurement, sourcing and
sampling are able to leverage applications that reduce the
latency typically found in supply chain innovation processes.
Its solutions help buyer agents, supplier relationship
managers and supplier representatives manage their most
critical business processes and increase the value addition
of the development supply chain;
(cid:125) Quality and Compliance: ENOVIA’s applications support
users in material compliance, auditing, document, and
records management. These applications help companies
pro-actively manage regulatory compliance as part of the
product development process;
(cid:125) IP Classification and Security: ENOVIA’s applications
for IP Classification and Security provide users with the
flexibility to collaborate on a global scale while maintaining
the security required for operating their businesses. This
provides teams with the confidence to innovate while
optimizing the product catalog and reducing the carrying
cost of non-value added design inventory.
3DEXCITE – Marketing in the Age of Experience
3DEXCITE software, solutions, and computer-generated
imagery (“CGI”) services provide high-end 3D visualizations
in real-time. 3DEXCITE opens up creative freedom to deliver
DASSAULT SYSTÈMES ANNUAL REPORT 2015 23
1 Presentation of the Group
Business Activities
emotional assets for digital, interactive marketing, and sales
experiences. From consulting to workflow to final visualization
assets, 3DEXCITE transforms engineering data into powerful
visual experiences.
interactive experiences are what make the CGI services
portfolio so unique. The main categories of CGI services
include: Stills; Films and animations; Real-time interactive
visuals; and Data preparation.
(cid:125) Software: 3DEXCITE’s leading software applications and
technologies form the basis to create 3D visualizations for
all types of products with the highest visual quality – even
before they are built. Key products include:
(cid:125) high-end 3D visualization: 3DEXCITE Deltagen, Deltaview,
Deltatex;
(cid:125) visual asset management: 3DEXCITE Picturebook,
Powerhouse.
Drawing on the innovative software applications, creative,
interactive solutions cover all aspects of the product lifecycle.
Solutions are structured along the four key disciplines of
Design, Development, Marketing, and Sales:
(cid:125) 3DEXCITE Design Solutions enable a borderless workflow,
allowing designers to continuously review the geometry,
materials, and design throughout the creative process.
Dedicated tools and functions allow them to effectively
communicate their ideas in real-time, involving consumers
and decision-makers from the very start;
(cid:125) 3DEXCITE Development Solutions permit instant and
continuous visual and functional analysis, simulation,
and review of engineering work. Highly realistic 3D
visualizations allow testing of complex situations in real-
time, enriched by different types of simulation data,
leading to extensive cost and time savings;
(cid:125) 3DEXCITE Marketing Solutions create a seamless
interplay between design and marketing disciplines
to accelerate communication from early stages, taking
internal awareness of a new product to a new level. Global
marketing teams are only a mouse-click away from the
latest visualizations of future products, allowing them
to fine-tune for local requirements. Companies can plan
launch events even before the product is built – thanks
to cross-channel imagery productions based on 3D design
data;
(cid:125) 3DEXCITE Sales Solutions provide the tools for a unique
product experience – whether at the Point of Sale (PoS),
at events, online, or on the go. Its integrated approach
intelligently uses source data created in earlier stages of
the product development process, helping to significantly
reduce the sales cycle and facilitating for customers their
decision process, from try to buy.
(cid:125) Computer Generated Imagery services: Highest visual
quality, sophisticated artistic effects, and spellbinding
Information Intelligence Applications
EXALEAD – The Data Science
EXALEAD helps organizations access, analyze and reveal
any enterprise digital
intellectual properties or external
information, thus transforming big data into data discovery
and analytics applications.
More specifically, EXALEAD is focusing on two areas:
PLM Search & Analytics
These applications are based on technology developed
to combine innovative big data approaches with Dassault
Systèmes unique PLM DNA, such as 3D or complex multi-level
configured product structures.
EXALEAD OnePart allows any design, standardization or
procurement engineer to quickly and efficiently discover
the most relevant reusable parts that fit design constraints
(technical, costs, compliance). It empowers engineers with
unique search and compare capabilities (keywords, 3D, big
data) while linking CAD and PLM systems with other enterprise
IT systems, such as ERP (Enterprise Resource Planning) and
SCM (Supply Chain Management).
EXALEAD OnePart Reduce accelerates the value delivered by
OnePart by applying machine learning technologies to the
millions of legacy CAD parts available, quickly identifying
potential deduplication and leveraging procurement with
suppliers via an “automated” shape-based classification
approach.
EXALEAD PLM Analytics: Dassault Systèmes has developed
the best of analytics and made it applicable to PLM while
leveraging the richness and the full potential of product design
and manufacturing processes. EXALEAD PLM Analytics allows
customers to fully manage product programs, from design to
traceability of changes, cost, quality, and issue analytics.
Customer Support & Service Analytics
Companies are able to compile, analyze and uncover the
value of “product-generated” data, combined with customer
information and aggregated data found in any systems that
may be used during product support and operations, creating
new services and enhancing competiveness and customer
satisfaction.
24 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
EXALEAD OneCall
With a 360-degree view of customers and analytics capabilities,
OneCall unlocks the value of data and information, improving
customer interaction, recommendations, and engagement.
Product in Operations
Product in Operations is a range of collaborative search-based
solutions developed for collecting, analyzing and capitalizing
on information about product and machine use. Organizations
can manage in real time after-sales, maintenance, and
customer interactions. Processes are optimized while new,
innovative products and services are created.
NETVIBES – Dashboard Intelligence
NETVIBES dashboard intelligence helps enterprises identify
and manage everything on real-time, personalized dashboards
designed to enable better, faster decision-making. All
employees can understand everything that matters across
all internal systems and across the social web, anywhere,
anytime, on any device – all in one place. NETVIBES also goes
beyond business intelligence with real-time, industry-specific
social analytics and SmartTagging for gathering expert human
opinions, and it helps users save time with automated reporting
and intelligent alerts on what matters. NETVIBES includes a
Dashboard of Things which enables users to program their
business logic by automating digital activities and customizing
individualized real-time alerts from the dashboard. By creating
a “Potion” with specific Trigger(s) and Action(s), anyone can
easily program automatic interactions between data, apps and
connected devices. Through a customer-facing, programmable
dashboard, enterprises can also empower consumers to design
their own custom product experiences.
1.4.2.5
Sales and Marketing
The Company’s customers range from start-ups, small and
mid-sized companies to the largest companies in the world as
well as educational institutions and government departments.
To ensure sales and marketing coverage of all its customers,
the Company has developed three sales and distribution
channels, with one direct and two indirect sales channels. No
single customer or sales channel partner represented more
than 5% of the Company’s total revenue in 2015 and 2014.
(cid:125) 3DS Business Transformation channel: sales to
large
companies and government entities are generally
conducted through the Company’s direct sales channel,
the 3DS Business Transformation channel. Direct sales
represented 59% and 58% of revenue in 2015 and 2014,
respectively.
(cid:125) 3DS Value Solutions channel: sales to small and mid-sized
companies are conducted indirectly generally through the
Company’s Value Solutions channel, a global network of
Presentation of the Group
Business Activities
1
value-added resellers with Industry specialization. This
channel represented 21% and 23% of the Company’s
revenue in 2015 and 2014, respectively.
1
(cid:125) 3DS Professional channel: the 3DS Professional channel
is an indirect channel focused on the volume market. It
is comprised of a network of value-added resellers and
local training,
distributors worldwide providing sales,
services and support to customers. Sales through this
channel represented 20% and 19% of the Company’s total
revenue in 2015 and 2014, respectively.
In addition to its sales channels, the Company is actively
developing and expanding
relationships with system
integrators with industry and domain expertise.
1.4.2.6
Education Initiatives
Dassault Systèmes has had a long-standing commitment to
education, with its solutions in use in nearly 40,000 schools
around the world. An estimated five million students use the
Company’s solutions. Students that apply Dassault Systèmes
tools in school and in research are well prepared for their
future jobs and careers.
leader
(STEM)
and Mathematics
As the 3DEXPERIENCE
in Science Technology
Engineering
education,
Dassault Systèmes works hand-in-hand with teachers all over
the world to develop innovative pedagogical curriculum and
learning experiences through enhanced teaching methods and
3D experiences, which will contribute to the training for the
engineers of tomorrow. Dassault Systèmes is committed to
help develop the 21st century global skill sets.
In 2015, Dassault Systèmes successfully
launched the
3DEXPERIENCE for Academia on the Cloud. In addition,
Dassault Systèmes has also invented a very innovative
pedagogical approach named the Peer Learning Experience. It
consists of gathering teachers from various universities and to
have them co-develop very comprehensive multi-disciplinary
and very flexible curricula which then become available, free
of charge, for any new school joining the 3DEXPERIENCE for
Academia community. To do so, they use a methodology,
templates, data and data models provided by the Company
which also does the overall project management.
Dassault Systèmes put in place a new Certification Program
which aims at certifying that students trained on the
Company’s solutions to ensure that they master them at a
good enough level compatible with employers’ expectations
thus maximizing employment and careers perspectives. That
program is mostly based on proctored practice workbenches
run on the Cloud. At the end of 2015, there are approximately
80 Certification Centers in operation all over the world with a
majority of them located on Universities’ campuses.
DASSAULT SYSTÈMES ANNUAL REPORT 2015 25
1 Presentation of the Group
Business Activities
Dassault Systèmes is one of the founders of key academic
associations such as the Global & European Engineering
Deans Councils, the International Federation of Engineering
Education Societies or the Cartagena Network of Engineering.
1.4.2.7
Competition
its current product portfolio, diversifying
The Company operates in a highly-competitive marketplace.
As it continues to broaden its addressable market, by
expanding
its
client base in new sectors of activity, and developing new
applications and markets, the Company faces an increasing
level of competition, from new competitors ranging from
technology start-ups to the largest technology companies in
the world. The Company’s competitors generally compete
with it in specific areas of its portfolio or in a specific set of
industries, but due to the breadth of the Company’s activities,
no single company competes with it across its entire scope.
The Company’s competitors include Siemens PLM Software
(a business unit of Siemens Industry Automation Division),
(principally with respect to the Company’s
Autodesk
SOLIDWORKS product line) and PTC. Competitors also include
companies focusing on specific domains or industries, including
among others Oracle and SAP with respect to ENOVIA and
DELMIA software applications and Altair Engineering, ANSYS,
CD-adapco and MSC Software, among others, with respect to
SIMULIA software applications.
Additional software developers who may compete directly or
indirectly with the Company include, among others, Adobe,
ARAS, Aveva, Bentley, Intergraph (owned by Hexagon),
Microsoft, Nemetschek, Onshape, Salesforce.com, and
other software companies in the mining sector or offering
information intelligence and social enterprise innovation and
collaboration software capabilities, and developers in all areas
of molecular chemistry or biology, optimizing processes or
digital marketing.
1.4.3 Material Contracts
Other than contracts entered into in the ordinary course of
business, the Company’s material contracts are principally
the distribution agreements with its value-added resellers
and system integrators, as described in paragraph 1.4.2.5
“Sales and Marketing”, and the strategic partnership contracts
described in paragraph 1.4.1.4 “Technology and Science” (see
“Technology and Software Partners”).
In 2011 Dassault Systèmes announced its investment in
Outscale, a start-up to provide Cloud operator services, and
signed an agreement to use these services.
In June 2013, Dassault Systèmes SE entered into a term loan
facility agreement for €350 million, which will be repaid in
July 2019. In October 2015, Dassault Systèmes SE entered
into a new five-year €650 million credit facility which
will be repaid in October 2020 and which maturity can be
extended by two additional years at the Company’s option.
See paragraph 3.1.4 “Capital Resources” and Note 20 to the
consolidated financial statements.
The Company signed long-term leases (for 12 years) for its
corporate headquarters in Vélizy-Villacoublay, France (the 3DS
Paris Campus) in 2008 and for its offices, technology lab and
data center in Waltham, outside Boston, United States (the 3DS
Boston Campus) in 2010. In February 2013, the Company has
committed to lease an additional 13,000 square meters of
office space and to enter into a new lease for its headquarters
facilities for a non-cancelable initial term of 10 years which will
take effect during the first quarter of 2017 when construction
is expected to be completed. See paragraph 1.6.2.3 “Liquidity
Risk” and Note 25 to the consolidated financial statements.
26 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Presentation of the Group
Research and Development
1
1.5 Research and Development
1
1.5.1 Overview
At December 31, 2015, the Company’s R&D teams included
5,853 personnel, compared to 5,562 at year-end 2014,
representing approximately 42% of the Company’s total
headcount. The Company increased its total R&D headcount
by 5.2% in 2015 primarily through internal growth and by
16.5% in 2014, principally reflecting growth in R&D resources
through acquisitions.
R&D expenses totaled €492.5 million for 2015, compared to
€409.7 million for 2014, increasing 20.2%, or approximately
11% excluding net negative currency effects. R&D costs
benefited from government grants and other governmental
programs supporting R&D of €34.8 million in 2015 and
€43.1 million in 2014. These government grants include
research and development tax credits received in France.
The Company has research facilities located primarily in
France, the United States and Germany, as well as in India,
Malaysia, the United Kingdom, Netherlands, Poland, Australia
and Canada.
The Group has R&D facilities in the countries where its clients
and hight-talent employees are located: in Europe (mainly
France, Germany, the United Kingdom, the Netherlands
and Poland), the Americas (United States and Canada) and
Asia-Pacific (mainly India, Malaysia and Australia).
1.5.2
Intellectual Property
its technology by applying a
The Company protects
combination of IP rights
including copyrights, patents,
trademarks and trade secrets. The Company distributes its
software products to its customers under licenses that grant
software utilization rights without transfer of ownership. The
contracts contain various provisions protecting the Company’s
IP rights over its technology, as well as related confidentiality
rights.
The source code (set of instructions under an intelligible
form, and used, once compiled, to generate the object code
licensed to clients and partners) of the Company’s products is
protected both as a copyrighted work and as a trade secret. In
addition, some of the key capabilities of its software products
are protected through patents whenever possible.
However, no assurance can be given that others will not copy
or otherwise obtain and/or use the Company’s products
or technology without authorization. In addition, effective
copyright, trade secret, trademark and patent protection or
enforcement may be unavailable or limited in certain countries.
The Company is nevertheless engaged in an active policy
against piracy and takes systematic measures to prevent
the illegal use and distribution of its products, ranging from
regularizing illegal use to initiating legal proceedings.
With regard to trademarks, the Company’s policy is to
register trademarks for its principal products and services
The Company’s R&D is conducted in close cooperation with
customers and users in their respective industries to develop
a deeper understanding of the unique business processes of
these industries as well as the future product directions and
requirements of these industries, customers and users.
in the countries where it does business. Protection through
the trademark
international
trademark, European Community trademarks and/or national
registrations.
is a combination of
law
In order to protect its technology and key product capabilities,
the Company generally files patent applications in countries
where many of its main customers and competitors are
located. At year-end 2015, the Company’s portfolio comprised
429 protected inventions, including 50 new inventions in
2015. Patents have been granted in one or more countries for
more than half these inventions, and patents for the others
are pending. When a patent protection is deemed unsuitable,
certain inventions are kept secret, with the proof of creation
being saved. The Company also has a cross-license policy for
patents with major players in its industry.
See paragraph 1.6.1 “Risks Related to the Company’s
Business”, and particularly paragraph 1.6.1.2 “Challenges to
the Company’s Intellectual Property Rights” for the difficulties
in ensuring adequate protection for the Company’s own
intellectual property, and paragraph 1.6.1.12 “Infringement
of Third-Party Intellectual Property Rights and of Third-Party
risks concerning possible
Technology’s Licenses”
third-party allegations of unauthorized use of their intellectual
property.
for
DASSAULT SYSTÈMES ANNUAL REPORT 2015 27
1 Presentation of the Group
Risk factors
1.6 Risk factors
The Risk Factors are set out hereafter in two main categories:
risks related to the Group’s Business (1.6.1) and financial and
market risks (1.6.2). These are the main risks identified as
being material, relevant and likely to have a negative impact
on the Company’s business and financial position as of the
date on which this Annual Report (Document de référence)
was filed with the AMF. However, other risks not mentioned
or not yet identified can affect the Company, its financial
position, its reputation, its outlook or the share price of
Dassault Systèmes SE.
1.6.1 Risks Related to the Company’s Business
1.6.1.1 Uncertain Global Economic
Environment
In light of the continuing uncertainties regarding economic,
business, social and geopolitical conditions at the global level,
the Company’s revenue, net earnings and cash flows may
grow more slowly, whether on an annual or quarterly basis,
mainly due to the following factors:
(cid:125) the deployment of the Company’s solutions may represent
a large portion of a customer’s investments in software
technology. Decisions to make such an investment are
impacted by the economic environment in which the
customers operate. Uncertain global economic conditions
and the lack of visibility or the lack of financial resources
may cause some customers to reduce, postpone or terminate
their investments, or to reduce or not renew ongoing paid
maintenance for their installed base. Such situations may
impact the Company’s revenues. This is particularly the
case in core industries (aerospace, automotive, industrial
equipment), which represent a significant part of the
Company’s revenue. Continued pressure on raw materials
and energy prices could also slow down the Company’s
diversification efforts in new industries;
(cid:125) the sales cycle of the Company’s products – already relatively
long due to the strategic nature of such investments for
customers – could further lengthen due to the uncertain
global economic context; and
(cid:125) the political, economic and monetary situation in certain
geographic regions where the Company operates could
continue to deteriorate.
The Company makes every effort to take into consideration this
uncertain macroeconomic outlook. The Company’s business
results, however, may not develop as anticipated. Furthermore,
due to factors affecting sales of the Company’s products and
services as described above, there may be a substantial time
lag between an improvement in global economic and business
conditions and an upswing in the Company’s business results.
The current economic context may also adversely impact the
financial situation or financing capabilities of the Company’s
potential and existing customers, reseller network and
technology partners, some of whom may be forced to cease
operations due to cash flow and profitability issues. The
Company’s ability to collect outstanding receivables may be
affected. In addition, the uncertain economic environment
could generate increased price pressure, as customers seek
lower prices from various competitors, which could negatively
impact the Company’s revenue, financial performance and
market position.
Finally, given public debt challenges, an increase in tax
pressure resulting from either the modification of current
tax structures, the creation of new taxes or more aggressive
positions taken by tax administrations could have a negative
effect on the Company’s business results.
To limit the impact of the economic environment on its
business and financial results, the Company continues to
further diversify its customer base through expanding its
presence in new business sectors and new geographic markets
Information: 2015
(see paragraph 3.1.2 “Consolidated
Compared to 2014” for the breakdown of consolidated Group
revenue by geographic region). It also continues to ensure that
its costs are controlled for the entire organization.
1.6.1.2
Challenges to the Company’s
Intellectual Property Rights
The Company’s success
its
proprietary software technology. The Company relies on a
combination of copyright, patent, trademark, trade secret law
and contractual restrictions to protect the proprietary aspects
is heavily dependent upon
28 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Presentation of the Group
Risk factors
1
1
of its technology. These legal protections don’t provide a full
coverage of the Company’s products and can be breached
by third parties. In addition, effective copyright, patent,
trademark and trade secret protection may be unavailable or
limited in certain countries where IP rights are less protected
than in the United States or Western Europe. If, despite the
Company’s strategies for protecting its IP, certain third-parties
are able to develop similar technology, a reduction in the
Company’s software revenues may result. Furthermore,
although the Company entered into confidentiality and license
agreements with
its employees, distributors, customers
and potential customers, and limits access to and carefully
controls the distribution of its software, documentation
and other proprietary
information, the measures taken
may be inappropriate to deter misappropriation or prevent
independent third-party development of the Company’s
technology.
In addition, like most of its competitors, the Company faces
a significant level of piracy of its leading products, by both
individuals and groups acting worldwide, which could
potentially affect the Company’s growth in specific markets.
Litigation may be necessary to enforce the Company’s IP
rights and determine the validity and scope of the proprietary
rights of third-parties. Any litigation could result in substantial
costs and diversion of Company resources and could seriously
harm the Company’s operating results. The Company may not
prevail in any such litigation and its IP rights may be found
invalid or unenforceable.
In order to protect its IP, the Company regularly registers
patents for its most advanced innovations and systematically
registers copyrights. The Company continues to extend its
anti-piracy and compliance programs, which are proving
effective.
1.6.1.3
Security of Internal Systems
and Facilities
The Company’s R&D facilities are computer-based and rely
entirely on the proper functioning of complex software and
integrated hardware systems. However, it is not possible to
guarantee the uninterrupted operation and complete security
of these systems. For example, the invasion of the Company’s
computer-based systems by either computer hackers or
industrial pirates could interfere with their proper functioning
and cause substantial damage, loss of data or delays in
on-going R&D activities. It could also lead to damage to or loss
of data hosted by the Company on behalf of its customers as
part of its cloud offerings, or to increased liability with respect
to interrupted access to online service. Computer viruses,
whether deliberately or unintentionally introduced, could
also cause similar damage, loss or delays. The increasing use
of mobile devices (cellular telephones, tablets and portable
computers) linked to certain of the Company’s computer
systems tends to increase the risk of unauthorized access as a
result of their loss or theft.
In addition, because the Company’s key facilities are located
in a limited number of sites, including Japan and California,
which may be exposed to earthquakes, substantial physical
damage to any one of the Company sites, by natural causes or
by terrorist attack or local violence, could materially reduce its
ability to continue its normal business operations.
If any of these circumstances were to arise, the resulting
damage, loss or delays could have a material negative impact
on the Company’s business, results of operations and financial
condition, as well as its reputation.
In order to reduce this risk, the Company therefore maintains
an IT security framework, including intrusion protection, data
storage back-up and restricted access to critical and sensitive
information, and also subscribes to insurance policies covering
these risks (see paragraph 1.6.3 “Insurance”).
Access to sites and security of employees traveling to specific
countries is also monitored.
1.6.1.4
Product Errors, Defects
and Installation Problems
Sophisticated software often contains errors, defects or other
performance problems when first introduced or when new
versions or enhancements are released. If the Company is not
able to correct in a timely manner errors or defects discovered in
its current or future products or provide an adequate response
to its customers, the Company may need to expend significant
financial, technical and management resources, or divert some
of its development resources, to resolve or work around those
defects. The Company may also incur an increase in its service
and warranty costs.
Errors, defects or other performance problems
in the
Company’s products may also result in the loss of, or delay
in, the market acceptance of its products or postponement
of customer deployment. Such difficulties could also cause
the Company to lose customers and, particularly in the
case of its largest customers, the potentially substantial
associated revenues which would have been generated by
its sales to companies participating in the customer’s supply
chain. Technical problems, or the loss of a customer with a
particularly important global reputation, could also damage
the Company’s own business reputation and cause the loss of
new business opportunities.
DASSAULT SYSTÈMES ANNUAL REPORT 2015 29
1 Presentation of the Group
Risk factors
Finally, the Company could experience problems in installing
complex solutions with certain customers as a result of the
customer’s infrastructure and software environment.
Because product errors, defects or installation problems could
result in significant financial or other damage to its customers,
such customers could pursue claims against the Company.
A product liability claim brought against Dassault Systèmes,
even if not successful, would likely be time consuming for its
management and costly to defend and could adversely affect
the Company’s marketing efforts.
To reduce the risk of product errors or defects, the Company
carries out advanced testing of its new products, releases, and
versions prior to market launch. The Company also works as
closely as possible with its customers to ensure successful
product installation.
The Company has also subscribed to an “Errors & Omissions”
insurance policy covering possible defects in its products,
although insurance carried by the Company may only
partially offset the cost of correcting significant errors
(see paragraph 1.6.3 “Insurance”).
1.6.1.5
Currency Fluctuations
The Company’s results of operations have been affected by
changes and high volatility in exchange rates in 2015, and are
likely to continue to be impacted in the future. In particular,
exchange rate fluctuation of the Japanese yen or of the U.S.
dollar relative to the euro, can impact revenues and expenses
recorded in the Company’s statement of income upon
translation of other currencies into euro.
The Company bills its customers in major currencies, principally
euros, U.S. dollars and Japanese yen. The Company also incurs
expenses in different currencies, principally euros, U.S. dollars
and Japanese yen, depending on the Company’s employees
and suppliers location in different countries. Moreover, the
Company engages in mergers and acquisitions, particularly
outside the euro zone and may lend money in different
currencies to its wholly or partially owned subsidiaries
or affiliates.
Although the Company currently benefits from a natural
coverage of most of its exposure to U.S. dollars from an
operating margin perspective, exchange rate fluctuation of
the U.S. dollar relative to the euro may impact the Company’s
revenue and consequently its operating income, net income
and earnings per share. In addition, the Company’s revenues
denominated in Japanese yen, Korean won and British pound
substantially outweigh its expenditures in these currencies.
As a result, the Company’s financial results are exposed to
a potential depreciation in the value of these currencies –
in particular the Japanese yen – relative to the euro, which
could adversely affect the Company’s revenue, as well as its
operating income, operating margin, net income and earnings
per share.
The Company’s net financial revenue can also be significantly
affected by changes in exchange rates between the time the
revenue is recognized and when cash payments are received,
and between the time an expense is recorded and when it is
paid. Any such differences are accounted for in the “foreign
exchange gain/loss” caption of the Company’s financial
statements.
The main items of financial income subject to fluctuations
linked to exchange rates are:
(cid:125) the difference between the exchange rate used to record
invoices in foreign currencies and the exchange rate when
the Company receives or makes the payment; and
(cid:125) the
revaluation of monetary assets and
liabilities
denominated in foreign currencies.
To address the risks created by currency fluctuations, the
Company carries out hedging operations on a case-by-case
basis (see Note 21 to the consolidated financial statements).
Since market growth rates for the Company’s software
applications and the revenue growth rates of its significant
competitors are computed in U.S. dollars, such growth rates
from period to period may not be comparable to the Company’s
euro-computed revenue growth rates for the same periods.
Finally, in spite of less stress on sovereign debt and financial
institutions, the Company continues to maintain a strengthened
review of the quality of its investments and remains vigilant as
to the liquidity of its assets (see paragraphs 1.6.2.3 “Liquidity
Risk” and 1.6.2.4 “Credit or Counterparty Risk”).
1.6.1.6
Complex International Regulatory
and Compliance Environment – Legal
Proceedings
Establishing or strengthening the Company’s presence in
countries where it previously had not been located or had been
present only marginally until now, and increasing the breadth
of its business and the diversity of its customers (particularly
individuals), have added to the complexity of the regulatory
environment in which the Company operates. The Company
is subject to complex and rapidly evolving laws, regulations
and requirements. The complex laws and regulations to which
the Company is subject apply to many different fields, such
as general business practices, competitive practices, handling
of personal data, consumer protection, financial reporting
standards, corporate governance, ethics and compliance,
employment laws, internal controls, local and international
tax regulations and export compliance for high-tech products.
Being listed on the French stock exchange, the Company also
is subject to specific requirements and reporting standards.
The Company seeks to conduct its business in a wholly ethical
and requires all of is employees, subsidiaries and indirect sales
channels to comply with all applicable laws and regulations.
The failure or suspected failure to comply with any of these
laws and regulations may result in increased regulatory
30 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Presentation of the Group
Risk factors
1
1
scrutiny through inquiries or investigations, adverse media
attention and fines and sanctions, as well as an increase to the
Company’s litigation risk or limits on the Company’s business
operations. A number of these adverse consequences could
occur even if it is ultimately determined that there has been
no failure to comply. There can be no assurance that additional
regulation in any of the jurisdictions in which the Company
currently operates, or may operate in the future, would not
significantly increase the cost of regulatory compliance.
Furthermore, the focus on tax matters is rapidly increasing in
many countries where the Company has operations.
risk of
litigation and administrative
The Company’s
proceedings also increases as it expands its activities, enhances
its position and visibility on the software market, and develops
new approaches to its business, including product distribution
and online services. Litigation can be lengthy, expensive, and
disruptive to the management of Company operations. Results
cannot be predicted with certainty, and adverse outcomes in
some or all of the claims pending against the Company may
result in significant monetary damages or injunctive relief
against the Company that could adversely affect its ability
to conduct business. Actual outcomes of litigation and other
claims may differ from management expectations, which
could result in a material adverse impact on the Company’s
financial position and results of operations.
In order to reduce this risk, the Company has implemented
an Ethics & Compliance program (as further described in
paragraph 2.1.5 “Business E thics, S ocial D ialogue and
P ersonal S afety”) which in particular requires all employees
to attend online Ethics & Compliance trainings. Moreover the
Company audits its subsidiaries around the world on a regular
basis and consults outside experts to validate the compliance
of various aspects of its practices with applicable regulations.
The Company’s Legal department, assisted by technical
experts, also monitors on a regular basis all outstanding claims
and litigation (see also paragraph 4.3 “Legal and Arbitration
Proceedings” and Note 25 to the consolidated financial
statements), some of which may be covered by insurance
(see paragraph 1.6.3 “Insurance”).
1.6.1.7
Competition and Pricing Pressure
In the past few years, there have been fewer contenders in
the Company’s historical software markets. As the various
players compete for market share, adoption by competitors
of business models different from Dassault Systèmes’ could
lead to substantial declines in pricing, which could require
the Company to adapt to a substantially different commercial
environment. These competitive pricing pressures could cause
competitive wins by competitors and could negatively impact
the Company’s revenue, financial performance and market
position.
At the same time, by regularly expanding its product
portfolio, entering new geographic markets, diversifying its
client base in new sectors of activity, and developing new
applications for its products, the Company encounters new
competitors. Such competitors could have, as a result of their
size or prior presence in these markets, financial, human or
technological resources not readily available to the Company.
The development of cloud computing offers may also lead to
new participants entering the market. The Company’s ability
to expand its competitive position may thus be reduced.
In the event the Company has difficulties setting up the
organization needed to manage its businesses and the new
competitive context, the revenues, results of operations,
competitive position and reputation of Dassault Systèmes
could be negatively impacted.
1.6.1.8 Relationships with Extended
Enterprise Partners
The Company’s 3DEXPERIENCE strategy requires a fully
integrated platform with access to computer-aided design
(“CAD”), simulation, collaboration, manufacturing and data
management products, which are increasingly complex and for
which customer installations represent significant enterprise
projects. To implement its 3DEXPERIENCE strategy, Dassault
Systèmes has continued to develop an extended enterprise
model and partners with other companies in areas such as:
(cid:125) computer hardware and technology, to maximize benefits
from available technology;
(cid:125) product development, to enable software developers to
create and market their own software applications using
Dassault Systèmes’ open product architecture; and
(cid:125) consulting and services, to support and assist customers
as needed to deploy Industry Solution Experiences on the
3DEXPERIENCE platform.
The Company believes that its partnering strategy allows it
to benefit from complementary resources and skills, and to
reduce costs while achieving broader market coverage. The
Company’s broad partnering strategy nevertheless creates a
degree of dependency on such partners.
In addition to its own sales force, the Company also relies
on an international network of distributors and value-added
resellers. The type of relationship that the Company has with
its distributors and value-added resellers, as well as their
financial and technical reliability, could impact the Company’s
ability to sell and deploy its product and service offerings.
DASSAULT SYSTÈMES ANNUAL REPORT 2015 31
1 Presentation of the Group
Risk factors
The Company’s ability to establish partner relationships for
the development, sale and deployment of its 3DEXPERIENCE
platform is an important element of its strategy.
Serious difficulties in the Company’s relationships with its
partners, or an unfavorable change of control of these partners,
may adversely affect the Company’s product and business
development, and could cause it to lose the contribution of
the employees or contractors of the Company’s partners,
particularly in the area of R&D. In addition, any failure by the
Company’s partners to deliver products of quality or according
to the expected timing may cause delays in the delivery of, or
deficiencies in, the Company’s own products.
Due to the rapid evolution of the software development and
distribution sectors, it is difficult to ensure the long-term
success of the Company’s relationship with any particular
partner. However, whenever entering into a relationship with
a new partner, the Company carefully considers the potential
new partner’s technical and financial viability.
1.6.1.9 Organizational and Operational
Challenges Arising from the Evolution
of the Company
through
its addressable market
Dassault Systèmes has continued to expand through
acquisitions and internal development, and has substantially
launching
increased
3DEXPERIENCE. The Company’s management policies and
internal systems must be adapted on an on-going basis
to meet the needs of a larger, more complex structure and
implement the Company’s strategy to reach a broader
market. The Company must continue to reorganize itself to
maintain efficiency, while ensuring customer retention and
the integration of newly acquired companies. It must also
continue to focus on quality of execution while maintaining
innovation.
As its organization evolves, the Company must also ensure
the profiles and competencies of its employee are constantly
upgraded and adapted.
If the Company does not address these issues effectively
and on a timely basis, the Company’s product development,
internal processes, cost management and commercial
operations could be impacted or fail to satisfy adequately
market or customer demands, which could negatively impact
its financial or operational performance.
In addition, in order to realize acquisitions or investments,
the Company may use significant financial resources, make
potentially dilutive issuances of equity securities or incur debt.
32 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Moreover, these operations may require the Company to
recognize amortization of acquired intangible assets and/or
depreciation of goodwill in case of impairment (see Note 2
to the consolidated financial statements). Minority interests
in unaffiliated partners or other investments may also have
to be written down in the Company accounts as a result of
impairment. Acquired companies may also carry risks related
to off-balance sheet commitments , including litigation risk
related to pre-acquisition events (for example, see below the
risk of claims that embedded components violate IP rights).
Each of these potential consequences of an investment or
acquisition could reduce the Company’s operating margin,
net income or cash.
The Company seeks to adjust on a regular basis its organization
and management model to support its current level of growth
by enhancing its geographic-based organization and providing
a consistent client experience around the globe.
1.6.1.10 Market introduction of a New Services
Offering for Cloud Computing
Dassault Systèmes is developing and distributing a services
offering for the online use of certain of its products (SaaS)
based on a cloud computing infrastructure. It continues to
grow its portfolio of software solutions and processes available
on the cloud. An inability to introduce such solutions at the
desired speed, with the appropriate pricing model and with the
right level of quality could impact the Company’s growth and
future results, and give rise to technical and legal challenges:
(cid:125) the progressive roll-out of these services and their
distribution also involves the deployment of new support
and management processes (for example, processing orders
and billing);
increased
(cid:125) the Company also will become exposed to a complex
risk
legal environment and could have
regarding regulatory compliance in the countries where
it has operations, in particular with respect to data
privacy, consumer laws and data confidentiality. In case
of difficulties in providing its clients with online services
under appropriate conditions, the Company’s revenues,
results of operations and competitive position, as well as
the reputation of Dassault Systèmes, could be negatively
affected.
The Company is seeking to minimize these risks by developing
alliances with partners with recognized technical capabilities,
and by simulating and controlling, to the extent possible, the
technical, legal and financial consequences of processes put in
place to serve its customers.
Presentation of the Group
Risk factors
1
1
1.6.1.11 Retention of Key Personnel
and Executives
The Company’s success depends to a significant extent upon
the continued service of its key managers and highly qualified
personnel, in particular in R&D, technical support and sales
management, and on its ability to continue to attract, retain
and motivate qualified personnel, as well as keep their skills
continuously up to date in line with the organizational needs.
In particular, if the Company fails to hire on a timely basis
and retain highly skilled sales forces, revenue may grow more
slowly. The competition for such employees is intense, and if
the Company loses the ability to hire and retain key employees
and executives with a diverse and high level of skills in
appropriate domains (such as R&D, industry and sales), it could
have a material adverse impact on its business activities and
operating results. The Company does not maintain insurance
with respect to the loss of key personnel.
In order to limit this risk, the Company has put in place training,
career development and long-term compensation incentives
to attract and retain key personnel and executives, and has
also diversified its R&D resources in different regions of the
world. The identification of key personnel also constitutes an
important step in the process of integrating newly acquired
companies into the Company.
1.6.1.12
Infringement of Third-Party
Intellectual Property Rights and of
Third-Party Technology’s Licenses
Third-parties, including the Company’s competitors, may
own or obtain copyrights, patents or other proprietary rights
that could restrict the Company’s ability to further develop,
use or sell its own product portfolio. Dassault Systèmes has
received, and may in the future receive, letters of complaint
alleging that its products infringe the patents and other IP
rights of others. Such claims could cause the Company to incur
substantial costs to defend itself in any litigation which may
be brought, regardless of its merits. If the Company fails to
prevail in IP litigation, it may be required to:
(cid:125) cease making, licensing or using the products or services
that incorporate the challenged IP;
(cid:125) obtain and pay for licenses from the holder of the infringed
IP right, which might not be available on acceptable terms
for Dassault Systèmes, if at all; or
(cid:125) redesign its products, which could involve substantial costs
and require the Company to interrupt product licensing and
product releases, or which may not be feasible at all.
In addition, the Company embeds in its products an increasing
number of third-party components selected either by the
Company itself or by companies which it acquires over time.
Although Dassault Systèmes has implemented strict approval
processes to certify the originality of third-party components
and verify any corresponding licensing terms, the same
approval processes may not have been adopted by companies
acquired by Dassault Systèmes before their acquisition. As a
result, the use of third-party embedded components in the
Company’s products generates exposure to the risk that a
third-party will claim that these components infringe their IP
rights. Also, due to the use of third-party components, there
is also a risk that such license(s) might expire or terminate
without renewal, thereby affecting certain Company products.
If any of the above situations were to occur for a significant
product, it could have a material adverse impact on the
Company’s financial condition and results of operations.
The Company seeks to limit this risk through a process for
certifying the origins of its products with respect to IP before
making them available for sale.
1.6.1.13 Rapidly Changing and Complex
Technologies
The Company’s software solutions are characterized by
the use of rapidly changing technologies and frequent new
product introductions or enhancements. These solutions
must address complex engineering needs in various areas
of product design, simulation and manufacturing, and
must also meet sophisticated process requirements in the
areas of change management, industrial collaboration and
cross-enterprise work.
As a result, the Company’s success is highly dependent upon
its ability to:
(cid:125) understand its customers’ complex needs in different
business sectors, and support them in reengineering key
product lifecycle processes, managing the migration of
substantial amounts of data in the process;
(cid:125) enhance its existing solutions by developing more advanced
technologies;
(cid:125) anticipate and take timely advantage of quickly evolving
technologies; and
(cid:125) introduce new solutions in a cost-competitive and timely
manner.
DASSAULT SYSTÈMES ANNUAL REPORT 2015 33
(cid:125) the number,
significance of product
enhancements or new products that the Company develops
or that are released by its competitors; and
timing and
(cid:125) general conditions in the Company’s software markets and
the software industry generally.
A substantial portion of the Company’s orders and shipments
typically occur in the last month of each quarter, and,
therefore, if any delay occurs in the timing of significant
orders, the Company may experience quarterly fluctuations
in its results of operations. Additionally, as is typical in the
software applications industry, the Company has historically
experienced its highest licensing activity for the year during
the last quarter of the year. Delays in orders and shipments
can also affect the Company’s revenue and income.
The trading price of the Dassault Systèmes’ shares may be
subject to wide fluctuations in response to quarterly variations
in the Company’s operating results and the operating results
of other software application developers in the Company’s
markets.
1.6.1.15 Technology Stock Volatility
Under conditions of increased market uncertainty, the trading
price of the Company’s shares could be volatile. The market
for shares of technology companies has in the past been more
volatile than the stock market overall.
1.6.1.16 Shareholder Base
Groupe Industriel Marcel Dassault SAS (“GIMD”), which
represents the interests of some of the Company’s founding
shareholders, owned 41.18% of the Company’s outstanding
shares, representing 55.53% of the exercisable voting rights
(55.12% of theoretical rights) as of December 31, 2015. As
more fully described in paragraph 6.3 “Information about
the Shareholders”, GIMD plays a decisive role with respect
to matters submitted to shareholders, including the election
and removal of directors and the approval of any merger,
consolidation or sale of all or substantially all of the Company’s
assets.
1 Presentation of the Group
Risk factors
The Company also continues to face the challenge of the
increasingly complex integration of its products’ different
functionalities to address customers’ requirements. As a
result, more difficult industrialization work is required for new
releases and offerings, with limitations on the options for
interfacing with third-party systems installed at the customer.
In addition, if the Company is not successful in anticipating
technological
leaps and developing new solutions and
services that address its customers’ increasingly sophisticated
expectations, demand for its products could decline, and the
Company’s results of operations and financial condition could
be negatively affected.
To reduce this risk and keep abreast or ahead of technological
developments which may affect its products, the Company
commits substantial resources to the development of new
offerings. It also maintains close and regular contacts with its
key customers to identify and capture their emerging needs
and to offer the most adapted solutions. In addition, the
Company provides training courses to its R&D teams on new
technologies. Complementing its internal R&D, the Company
seeks to maintain an active monitoring of third-party
technologies that it might acquire to improve its technology
offerings where appropriate.
1.6.1.14 Variability in Quarterly Operating
Results
The Company’s quarterly operating results have in the past
varied significantly, and may vary significantly in the future,
depending on factors such as:
(cid:125) the timing and cyclical nature of revenues received due
to the signing of important new customer orders, the
completion of major service contracts or the completion of
customer deployments;
(cid:125) the timing of any significant acquisitions or divestitures;
(cid:125) fluctuations in foreign currency exchange rates;
(cid:125) the Company’s ability to develop, introduce and market new
and enhanced versions of its products and customer order
deferrals in anticipation of these new or enhanced products;
34 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Presentation of the Group
Risk factors
1
1
1.6.2.2
Foreign Currency Risk
See paragraph 1.6.1.5 “Currency Fluctuations” above and
Note 21 to the consolidated financial statements.
1.6.2.3
Liquidity Risk
The Company has a low liquidity risk. As of December 31,
2015, the Company’s cash, cash equivalents and short-term
investments totaled €2.35 billion. See Note 12 to the
consolidated financial statements.
The Company has analyzed the amounts it will be required
to pay under its contractual commitments at December 31,
2015. The Company believes that it will be able to meet such
obligations.
1.6.2 Financial and Market Risks
The Company’s overall risk management policy is based upon
the prudent management of the Company’s market risks,
primarily foreign currency exchange risk and interest rate risk.
The Company’s programs with respect to the management
of these risks, including the use of hedging instruments, are
discussed in Note 21 to the consolidated financial statements.
The Company’s exposure to these risks may change over
time and there can be no assurance that the benefits of the
Company’s risk management policies will exceed the related
costs. Such changes could have a materially adverse impact on
the Company’s financial results.
The Company generates positive cash flows from operations
and has financial obligations (e.g., bank loans, loan facilities,
employee profit-sharing), but the Company’s cash position
net of debt is positive throughout the year.
1.6.2.1
Interest Rate Risk
The Company’s cash surplus generally earns interest at fixed
or floating market rates, while the Company’s debt carries
interest at floating rates. Therefore, the Company’s interest
rate risk is primarily related to a reduction of financial revenue.
See Notes 20 and 21 to the consolidated financial statements.
The following table summarizes the Company’s principal contractual obligations to make future payments as of December 31,
2015.
CONTRACTUAL OBLIGATIONS
(in thousands of euros)
Operating lease obligations(1)
Loan facilities(2)
Employee profit-sharing
TOTAL
Total
544,863
1,046,348
57,786
Less than
1 year
77,353
10,596
57,786
Payments due by period
1-3 years
135,690
3-5 years
111,331
22,369
1,013,383
-
-
More than
5 years
220,489
-
-
1,648,997
145,735
158,059
1,124,714
220,489
(1) Including €253.2 million of future minimum rental payments for the Company’s headquarters facilities located in Vélizy-Villacoublay, France and €105.2 million of future
minimum rental payments for the American subsidiaries’ facilities located in Waltham near Boston, United States (see Note 25 to the consolidated financial statements).
(2) Including interests on the €350 million and €650 million term loan facilities (see Note 20 to the consolidated financial statements).
1.6.2.4
Credit or Counterparty Risk
1.6.2.5
Equity Risk
include principally
The financial instruments which could expose the Company
its cash equivalents,
to credit risk
short-term
investments and customer receivables. The
hedging agreements entered into with financial institutions
pursuant to its policy for managing currency and interest rate
risks also expose the Company to credit and counterparty
risk. See Notes 12, 13 and 21 to the consolidated financial
statements. The Company uses a rigorous selection process
for its counterparts according to credit quality, based on
several criteria including agency ratings and depending on the
maturity dates of the transactions.
For cash management purposes, the Company does not
directly invest in listed shares, or any material amounts
in funds invested primarily in or indexed to stocks. The
Company’s financial results are therefore not significantly and
directly linked to stock market variations.
DASSAULT SYSTÈMES ANNUAL REPORT 2015 35
1 Presentation of the Group
Risk factors
1.6.3
Insurance
Dassault Systèmes is insured by several insurance companies
for all significant risks. Most of these risks are covered
either by insurance policies underwritten in France for the
whole Group, or by a North American policy that covers all
the North American subsidiaries and their own subsidiaries
and branches around the world. In addition, the Company
subscribes to specific coverage and/or local policies to comply
with applicable local regulations or to meet the specific needs
of certain activities or projects.
All of the Group’s companies are protected by a policy covering
professional and product liability as well as civil liability for
operations for a total insured value of €50 million for 2015.
In 2015, the Group renewed its Directors and Officer’s Liability
Policy for Dassault Systèmes SE and its subsidiaries for a total
insured amount of €50 million.
The Company also carries insurance to cover computer risks in
an amount equal to the value of its computer equipment and
coverage for damage to goods.
Based on the legal requirements applicable in each country,
the North American companies and most of their subsidiaries
have specific insurance cover. This insurance includes in
particular coverage for damage to goods, computer risks, loss
of business and operational civil liability and professional
liability. In connection with this insurance, the Company
also has coverage for work-related accidents and automobile
accidents. As additional coverage for the various insurance
policies covering the North American companies and their
subsidiaries, Dassault Systèmes carries an “umbrella” policy
for a maximum amount of $25 million.
The insurance policies are reviewed regularly and may be
modified to reflect changes in the revenue, activities and risks
of the different companies within the Group.
Dassault Systèmes has not established captive insurance
coverage.
36 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
2
SOCIAL, SOCIETAL AND
ENVIRONMENTAL
RESPONSIBILITY
2.1 Social and Societal Responsibility
38
2.2 Environmental Responsibility
58
CONTENTS
2.1.1 Group Organization and Employees
2.1.2 Attracting and Developing Talented Individuals
2.1.3 Welcoming employees who have joined the Group
via recently acquired companies
39
42
49
2.1.4 Rewarding Performance and Recognizing Employees 50
2.1.5 Business ethics, social dialogue and personal safety 52
2.1.6 Methodology for Employee Reporting
2.1.7 Appendices regarding the Group’s Employee
Headcount
54
56
2.2.1 The Group’s vision for environmental responsibility 58
2.2.2 Responsible Company
2.2.3 Responsible Employee
2.2.4 Responsible Partner
2.2.5 Methodology for Environmental Reporting
2.2.6 Industrial and Environmental Risk
2.3 Independent Verifi er’s Attestation
and Assurance Report on Social,
Societal and Environmental
Information
59
65
65
66
67
68
DASSAULT SYSTÈMES ANNUAL REPORT 2015
37
2 Social, Societal and Environmental Responsibility
Social and Societal Responsibility
“The 3DEXPERIENCE Company”,
Dassault Systèmes,
constantly strives to provide businesses and individuals
with 3D universes that allow them to imagine sustainable
innovations capable of harmonizing product, nature and life.
Through this ambition, Dassault Systèmes contributes to the
improvement of society and quality of the environment.
By their very nature, virtual universes and the virtual experience
that they produce make it possible to address major industrial
challenges, such as the management of environmental
impacts on a large scale, safety or ergonomics. The adoption
of the 3DEXPERIENCE platform by customers allows them
to envisage new ways of imagining, creating and producing.
Planning better, collaborating better, learning better: these
virtual universes are also essential to gaining insight into and
resolving the current issues in society.
The 13,974 Group employees spread over 40 countries are
driven by this ambition.
Dassault Systèmes has been recognized in various sustainable
development indices and rankings, including the Global 100
Index, the FTSE4Good and the Carbon Disclosure Project.
2.1 Social and Societal Responsibility
Harmonizing product, nature and life: this ambition can only
be achieved with the support of the Group’s employees, who
are its most valuable asset. They represent the Company’s
culture and values and are at the heart of its strategy and its
long-term development.
In the light of the Group’s rapid growth, the climate of
innovation in which it operates, and its growing number of
markets, its main social and societal challenges are as follows:
Sharing and increasing skills
For Dassault Systèmes, sharing skills means mobilizing the
Group’s technologies and talented people to improve society
in areas such as education. Created in 2015, “The Dassault
Systèmes Foundation” lends it support to the academic world,
research centers and general interest organizations (non-
profit organizations, museums etc.) in Europe in their quest
for knowledge and contributes to transforming the learning
experience. Virtual universes can bring much more than
traditional classroom books and boards, such as the “3Dcodex”,
a new generation of scientific media that can produce models
of the physical world with astonishing realism, like a digital
twin.
Dassault Systèmes is permanently extending its range of
expertise and collaborates with varied profiles: biologists,
doctors, geologists, designers, architects… The Group has
numerous “selling points” to attract these candidates and
keep them motivated: a long-term and high societal value
strategic vision, as well as a dynamic and collaborative
working environment based on the 3DEXPERIENCE platform
and centered on communities of interest and expertise.
Inventing new ways to collaborate
Dassault Systèmes developed an initiative in 2015 to create
new collaborative methods and a more transversal work model,
more conducive to creativity. This initiative aims to allow each
person to reveal and use their skills as well as to diversify their
activity and expand their network. Among other initiatives,
the 3DEXPERIENCE Lab, implemented in November 2015,
is an open innovation laboratory within the company to help
innovative start-ups to grow . This initiative gives employees
the opportunity to get involved in new projects, not necessarily
connected to their positions.
information,
Structuring information, a strategic value for the
Company and its ecosystem
The continual interaction of employees within the Company
and with its ecosystem of customers and partners, through
applications, or on-line communities , generates a vast
quantity of
including structured and non-
structured data on a daily basis, which form part of the
Company’s intellectual and economic property. The challenge
lies with analyzing, processing in real time, connecting and
representing this information and data so that it can be
converted into competitive advantages and decision-making
aids. With its 3DEXPERIENCE platform, Dassault Systèmes
already has its own tools for managing and monitoring the
Company’s business.
38 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Social, Societal and Environmental Responsibility
Social and Societal Responsibility
2
Accelerating the integration of new employees
A major challenge within a constantly growing company is
to integrate new employees. To address this, in addition to
the reception and initial support process, Dassault Systèmes
provides online communities with fast-paced access to
information on the Company, organizations and projects,
while showcasing the responsibilities, skills and contributions
of each employee.
The different indicators related to these challenges and, more
broadly, the human resources initiatives implemented within
the Group are presented below.
(cid:125) Group organization and employees (2.1.1);
(cid:125) Attracting and developing talented individuals (2.1.2);
(cid:125) Welcoming employees who have joined the Group via
recently acquired companies (2.1.3);
(cid:125) Rewarding performance and recognizing employees (2.1.4);
(cid:125) Business ethics, social dialogue and personal safety (2.1.5).
is described
in paragraph 2.1.6.
The methodology
“Methodology for Employee Reporting” and additional
information is presented in paragraph 2.1.7. “Appendices
regarding the Group’s Employee Headcount”.
2
2.1.1 Group Organization and Employees
The Group is organized by major fields of activity: R&D;
Sales, Marketing and Services; and Administration and
Other functions for its main markets (see paragraph 1.4.2
“Principal Markets”) within the three geographic regions
(Europe, Americas and Asia). The Total Workforce is made up
of employees, employees of 3D PLM Software Solutions Ltd
and 3DPLM Global Services Private Ltd, in which the Group
owns less than 50% and service providers.
The data related to the Group’s workforce presented in this
report is expressed in Full Time Equivalents according to the
methodology defined in paragraph 2.1.6. “Methodology
for Employee Reporting”. The other indicators used are also
explained in this paragraph.
Overview and Growth of Total Workforce
As of December 31, 2015, the Total Workforce was 13,974, up 5% compared to December 31, 2014. The number of employees
over the last three years is set forth below:
Year ended December 31,
2015
2014
2013
*
Indicator verified by the independent verifier.
Employees
11,422*
11,013
8,587
S ervice
Providers
405
474
378
3D PLM Total Workforce
Percent change
2,147
1,825
1,689
13,974
13,312
10,654
5.0%
24.9%
5.3%
Overview and Growth of Employee Headcount
Growth of the Company
As of December 31, 2015, the Employee Headcount increased
4% year over year to 11,422 full-time equivalent employees,
located in 40 countries and originating from 123 different
countries. This growth is due principally to recruitment
carried out in 2015. For more details, see paragraph 2.1.2.1.
“Attracting talented individuals – Movements in Employee
Headcount over the period”.
The Employee Headcount
remained overall stable between 2014 and 2015.
indicators presented below
DASSAULT SYSTÈMES ANNUAL REPORT 2015
39
2 Social, Societal and Environmental Responsibility
Social and Societal Responsibility
Distribution by geographic region
Year ended December 31
Employees
% Employees
% Employees
% Employees
Europe
Americas
Asia
Total
2015
2014
*
Indicator verified by the independent verifier.
Distribution by activity
5,987
5,787
52%
53%
3,524
3,449
31%
31%
1,911
1,777
17% 11,422*
16%
11,013
Europe
Americas
Asia
Total
Total
Year ended December 31
R&D
Sales, Marketing and Services
Administration and other
Employees
2015
Employees
2015
%
Employees
2015
%
Employees
2015
%
Employees
2014
%
2,281
2,924
782
38%
49%
13%
1,139
1,933
452
32%
55%
13%
300
1,425
186
16%
75%
9%
3,720
6,282
1,420
33%
55%
12%
3,518
6,091
1,404
%
100%
100%
%
32%
55%
13%
TOTAL
5,987
100%
3,524
100%
1,911
100% 11,422*
100%
11,013
100%
*
Indicator verified by the independent verifier.
Distribution by gender
The proportion of women in the Group, while stable between
2014 and 2015, may still seem relatively low. This is mainly
explained by the low number of women in engineering schools
which is one of the main sources of recruitment for Dassault
Systèmes.
Year ended December 31
Employees
2015
Employees
2015
%
Employees
2015
%
Employees
2015
%
Employees
2014
%
Europe
Americas
Asia
Total
Total
Women
Men
TOTAL
1,372
4,615
5,987
23%
77%
100%
876
2,648
3,524
25%
75%
100%
463
1,448
1,911
*
Indicator verified by the independent verifier.
24%
76%
2,711
8,711
24%
76%
2,586
8,427
100% 11,422*
100%
11,013
100%
%
23%
77%
Other characteristics of Employee Headcount
As at December 31, 2015, the key figures to note are as follows
(indicator verified by the independent verifier in 2015):
(cid:125) 98% of the Employee Headcount had permanent contracts
and Managers represented 19% of total headcount;
(cid:125) 14% of the 2,711 women employed by Dassault Systèmes
and 20% of the 8,711 men working for the Company are
Managers; among the 2,156 Managers, 17% are women.
These figures are relatively stable compared to 2014. The
breakdown of this information and additional information with
regard to the distribution by age and seniority are presented in
paragraph 2.1.7 “Appendices regarding the Group’s Employee
Headcount”.
Outside service providers and sub-contracting
Dassault Systèmes regularly calls on outside service providers
when it requires resources with specific know-how or for
projects with a limited duration.
The cost of using outside service providers in 2015 amounted
to €78.0 million, compared to €75.1 million in 2014, an
insignificant amount in relation to the Dassault Systèmes
operating expenses (€2.21 billion in 2015 and €1.86 billion
in 2014).
40 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Social, Societal and Environmental Responsibility
Social and Societal Responsibility
2
At December 31, 2015, 405 outside service providers (data expressed in full-time equivalents) worked for the Group:
Year ended December 31,
Employees
% Employees
% Employees
% Employees
2015
2014
188
217
46%
46%
144
177
36%
37%
73
80
18%
17%
405
474
Europe
Americas
Asia
Total
%
100%
100%
2
Dassault Systèmes only establishes contractual relationships
with sub-contractors that respect the fundamental laws
and regulations concerning labor law and environmental
protection (see “Principles of Enterprise Social Responsibility
and commitments to ensuring respect for basic rights” in
paragraph 2.1.5 “Business ethics, social dialogue and personal
safety”).
Organization
Work time
In each country where Dassault Systèmes has operations, the
length of the workweek is determined according to the local
regulations.
For example, in France, work time is determined according to
whether an employee is under the system of annual working
days (forfait jours) or the hourly system (régime horaire).
Employees under the system of annual working days work
a predefined number of days per calendar year and other
employees work a certain number of hours as defined by local
labor agreements in force within each company.
In most of the other countries where the Group is located, the
workweek is set at 40 hours. This is the case in Germany, the
United Kingdom, the Netherlands, the United States, Canada,
Japan, Malaysia, China and India. In Australia, the workweek
is 38 hours.
Full-time and part-time
97% of the Employee Headcount works on a full-time basis.
7% of women and 1% of men work on a part-time basis. These
figures are relatively stable versus 2014. Full details of the
information on this indicator are presented in paragraph 2.1.7
“Appendices regarding the Group’s Employee Headcount”.
Absenteeism
Absenteeism is tracked locally in accordance with regulations
applicable in the different countries where Dassault Systèmes
operates. The Company does not have a harmonized system
for managing absenteeism throughout
its subsidiaries
(indicator verified by the independent verifier in 2015).
The information presented below covers a part of the Group’s
French companies (Dassault Systèmes SE, Dassault Systèmes
Provence SAS, Dassault Data Services SAS, Netvibes SAS,
3DVIA SAS, Quintiq SAS, Dassault Systèmes Biovia SARL),
which represent 30% of the Employee Headcount:
(cid:125) in 2015, the reasons for employees not reporting for work,
excluding annual leave, are as follows: illness for 10,272
days, maternity and paternity leave for 4,801 days, work
accident and work-related travel accident for 285 days.
The resulting absenteeism rate is 2.1%, stable compared to
2014 (2.2%);
(cid:125) the total number of authorized absences (such as parental
leave and leave for family events excluding paid leave) was
2,765 days at end 2015, or 0.4% of the number of days
theoretically worked. This rate is identical to that of 2014.
In the other main countries where the Group operates, the
absenteeism rate was the following in 2015: 3.6% in Germany
compared to 2.9% in 2014, 1.0 % in the United Kingdom
compared to 1.3% in 2014, 3.3% in the Netherlands, 0.8% in
the United States compared to 0.9% in 2014, 3.3% in Canada
compared to 2.9% in 2014, 0.6% in Japan compared to 0.5%
in 2014, 3.2% in Malaysia, 0.6% in China compared to 1.8%
in 2014 and 2.4% in Australia. The rate remains very low in
South Korea and India (less than 0.5%), where absenteeism
for reasons of short-term illness is difficult to ascertain as it is
included in paid leave.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
41
2 Social, Societal and Environmental Responsibility
Social and Societal Responsibility
2.1.2 Attracting and D eveloping T alented I ndividuals
2.1.2.1 Attracting talented individuals
To work for Dassault Systèmes, it is important to have a
passion for technological innovation, a desire to work with
other people and constantly learn and have an appetite for a
challenge; these qualities correspond to the Group’s values.
Dassault Systèmes offers its employees an attractive working
environment, in facilities, many of which boast excellent green
ratings and infrastructure conducive to teamwork. In 2015,
62% of the Employee Headcount worked in certified offices
compared to 57% in 2014. This increase comes from the
environmental reporting perimeter change as defined in the
paragraph 2.2.5 “Methodology for Environmental Reporting”.
Employees are mainly recruited locally with permanent
contracts, thus contributing to economic growth in each of
the 40 countries in which it operates. At December 31, 2015,
two-thirds of the Group’s Employee Headcount was located
outside France and the Group had employees from 123
different countries.
In general, all available positions are published internally and
externally and priority is given to internal promotion over
external recruitment where the skill level is equal.
Recruitment is a priority for Dassault Systèmes, in order
to meet requirements generated by its growth. The Group
aims to be recognized as an exemplary employer that
contributes to the development of all its people (permanent
employees, apprentices and interns). Dassault Systèmes
forges relationships with educational establishments and
universities in the major countries in which the Group operates.
Initiatives are undertaken in the vast majority of the countries
where the Group has facilities (see also paragraph 2.1.2.3
“Developing relations with the social, regional and community
environment”).
Movements in Employee Headcount over the period
Employee arrivals (Equivalent Full-time)
Most employee arrivals carried out in 2015 stem from direct
recruiting efforts. In 2014, acquisitions represented over
two-thirds of the Group’s new employees and explain most
variations between 2015 and 2014.
Year ended December 31
Permanent contracts
Temporary contracts
TOTAL
Europe
Americas
Asia
Total
Total
Employees
2015
Employees
2015
%
Employees
2015
%
Employees
2015
%
Employees
2014
%
637
141
778
82%
18%
100%
443
7
98%
2%
324
9
98%
2%
1,404
90% 3,298**
157
10%
225**
450
100%
333
100%
1,561*
100% 3,523**
100%
Indicator verified by the independent verifier.
*
** The figures reported for 2014 are based on the new methodology adopted for the year 2015 for this indicator (see paragraph 2.1.6 “Methodology for Employee Reporting”).
Year ended December 31,
Employees
2015
Employees
2015
%
Employees
2015
%
Employees
2015
%
Employees
2014
%
Europe
Americas
Asia
Total
Total
Women
Men
TOTAL
236
542
778
30%
70%
100%
137
313
450
30%
70%
100%
106
227
333
32%
68%
479
31%
932**
1,082
69% 2,591**
100%
1,561*
100% 3,523**
100%
Indicator verified by the independent verifier.
*
** The figures reported for 2014 are based on the new methodology adopted for the year 2015 for this indicator (see paragraph 2.1.6 “Methodology for Employee Reporting”).
The breakdown of employees recruited by type of activity is
as follows: 58% in Sales, Marketing and Services, 26% in R&D,
16% in Administration and other.
Additional Information with regard to the age pyramid is
presented in paragraph 2.1.7 “Appendices regarding the
Group’s Employee Headcount”.
42 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
%
94%
6%
%
26%
74%
Social, Societal and Environmental Responsibility
Social and Societal Responsibility
2
Employee departures (Full-Time Equivalent)
In 2015, 1,130 employees left the Company. Departures were broken down as follows:
Year ended December 31,
Permanent contracts
Temporary contracts
TOTAL
Europe
Americas
Asia
Total
Total
Employees
2015
Employees
2015
%
Employees
2015
%
Employees
2015
%
Employees
2014
%
437
102
539
81%
19%
100%
390
4
99%
1%
194
3
98%
2%
1,021
109
90%
10%
950**
107**
394
100%
197
100%
1,130*
100% 1,057**
100%
%
90%
10%
2
Indicator verified by the independent verifier.
*
** The figures reported for 2014 are based on the new methodology adopted for the year 2015 for this indicator (see paragraph 2.1.6 “Methodology for Employee Reporting”).
On average, the attrition rate was 10.1% in 2015 versus 10.5% in 2014. Excluding temporary contracts, the rate was 9.3% in
2015 and 10.1% in 2014.
2.1.2.2 Developing, training and managing
(cid:125) the R&D College: IT technologies;
the careers of Dassault Systèmes
employees
3DS University
In an environment of constant innovation, “Passion to Learn” is
one of Dassault Systèmes’ core values. This core value is driven
by the 3DS University mission, which is to offer development
initiatives in line with the activities and the objectives for each
employee.
Via the 3DEXPERIENCE University tool, based on the
3DEXPERIENCE platform and communities of experts,
Dassault Systèmes offers a range of training modules and
tests in various formats (on-line, face-to-face, e-classes), to
validate knowledge and skills.
In 2015, strategic development focused on boosting the
performance of sales forces and services teams, consolidating
and sharpening the technical skills of R&D employees and
ensuring that all employees had a solid grasp of Dassault
Systèmes’ solutions and applications.
Within this framework, the challenge is for each person to
be able to participate in the modules at any time via a digital
learning experience. The focus has been placed on blended
learning: e-learning, exchanges with experts and ongoing
dialogue with peers in on-line communities.
To propose a coherent training offering, the 3DS University
is structured around core skills development. Five Colleges
address job skills and two Programs deal with cross-sector
skills. Each College and Program offers a reference libraries of
learning opportunities:
(cid:125) the Sales College: customer relations and marketing, sales
and technical-commercial skills and service job skills;
(cid:125) the Business Administration College: finance, legal and
human resources management;
(cid:125) the Industry College: knowledge of Dassault Systèmes’
software range;
(cid:125) the Brand College: mastery of products sold and used by
customers;
(cid:125) the Manager Program: leadership and team management;
(cid:125) the SwYmer Program: skills associated with knowledge of
Dassault Systèmes, its values and soft skills.
Key 2015 actions in the Colleges
An on-line onboarding program for the sales team was
developed in the Sales College. The sales teams can now
consult modules, work on exercises, and learn the sales
processes and methods for their field at the most convenient
time for them. This program was tested in 2015. Already one
third of new employees in this function have taken the courses.
The marketing department also benefited from modules
made available on-line at the end of 2015, to understand the
strategy, tools and processes implemented within Dassault
Systèmes.
The sales support teams also took part in the programs,
focusing on understanding the sales force challenges and
contract management, in order to strengthen and optimize
everyone’s work in the sales process.
Web development training on the 3DEXPERIENCE platform
was deployed worldwide. Technological innovation is at the
heart of Dassault Systèmes’ concerns. Half of all hours were
provided in the e-learning format. This has allowed each
Group employee to receive the same content, which doubled
the total training hours provided worldwide.
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2015 was also an important year for the deployment of
training on product knowledge and solutions. Dassault
Systèmes’ solutions experts set up workshops to offer training
to all technical-sales employees, which were replicated
worldwide. The provision of on-line trainings to enhance
product knowledge was a major component in improving skills
in these subjects.
Key 2015 actions in the Programs
As part of its ongoing development efforts for Managers
undertaken in 2014, Dassault Systèmes added new training
offering to support individuals in their role. The Company has
expanded its offer to include: coaching, tutorial sessions and
special team-building events. This has reinforced Dassault
Systèmes’ values and consolidated a network of internal
experts devoted to this activity.
The implementation of onboarding sessions was harmonized
and is being gradually rolled out in the different countries
where the Group operates. All new Group employees take
part in the onboarding program, which presents the Dassault
Systèmes Group, its strategy, values and the 3DEXPERIENCE
platform on Day 1. 90 days later, additional sessions are
organized to consolidate knowledge and canvas feedback from
the new arrivals to continuously forge a sense of community
and sharing.
In 2015, 236,043 training hours were delivered in the main
Group countries (see paragraph 2.1.6 “Methodology for
Employee Reporting”). This number represents all trainings
formally reported by the different countries. It, however,
excludes other learning conditions falling outside this formal
context, such as on-the-ground learning, workshops and
virtual exchange communities. Training associated with the
solutions portfolio in the Dassault Systèmes’ offering (Brand
College) are now counted in this volume of hours as the result
of an updated reporting system. The ratio of training hours
per employee increased to 23 hours in 2015 compared to 13.3
hours in 2014. This 70% increase can be explained by the fact
that in 2015 the following were accounted for: the training
on the solutions portfolio in the Dassault Systèmes’ offering
(Brand College) and the integration of companies acquired in
the operations of the 3DS University. Excluding the impact of
these two combined effects, the ratio of training hours per
employee was stable: 14 hours in 2015 compared to 13.3
hours in 2014.
The number of hours of online training also increased
is
considerably. Online training was used more and
accounted for in all training courses. It is accessible from the
3DEXPERIENCE University and built into the employee career
development path. The share of this online training increased
to 52% in 2015 compared to 7% in 2014, mainly explained
by the significant use of this type of training by employees
from Quintiq Group companies acquired in 2014. 27% of
the 236,043 training hours accounted for comes from these
companies.
Training hours for women represent 22% of the total number
of hours in 2015 compared to 25% in 2014. The Brand College
explains this decrease which was predominantly attended by
men (87%), representing 49,094 hours at end 2015. However,
excluding Brand College, this proportion remained relatively
stable in 2015 (24%) compared to 2014 (25%).
44 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
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2
Distribution of training hours
by College or Program at December 31, 2015
Sales College
R&D College
Business Administration College
Industry College
Brand College
SwYmers Program
Managers Program
TOTAL
Distribution of training hours by category
Managers
Non-Managers
TOTAL
Distribution of training hours by men/women
Men
Women
TOTAL
Ratio
Europe(1)
Americas(1)
13,402
30,017
11,802
2,839
19,303
25,865
4,765
107,993
14,495
93,498
107,993
82,930
25,063
107,993
8,705
11,055
12,291
1,890
18,756
9,983
3,189
65,869
9,775
56,094
65,869
52,152
13,717
65,869
Asia(1)
10,278
17,893
5,472
1,881
11,035
12,312
3,310
62,181
7,457
54,724
62,181
49,856
12,325
62,181
2015
Total
32,385
58,965
29,565
6,610
49,094
48,160
11,264
%
14%
25%
12%
3%
21%
20%
5%
236,043*
100%
31,727
204,316
236,043*
184,938
51,105
236,043*
23 H(2)
13%
87%
100%
78%
22%
100%
2
Indicator verified by the independent verifier.
*
(1) Country > 150 Employees - Europe: France/Germany/United Kingdom/Netherlands – Americas: United States/Canada – Asia: Japan/Malaysia/China/South Korea/India/Australia.
(2) Ratio = average number of hours per employee excluding 2015 acquisitions.
Promoting diversity and gender balance
The Code of Business Conduct demonstrates the extent to
which the Dassault Systèmes culture is based on mutual
respect, fairness, and the diversity of its employees. Within
this context, recruitment, training, promotion, assignment
and more generally, all work-related decisions are based on
competencies, talent, achievements and employee motivation,
without any form of discrimination, harassment or bullying.
Professional equality between men and women
Dassault Systèmes encourages gender equality within its
workforce by developing access for women to its different
businesses and by spearheading initiatives for women’s career
advancement.
In June 2015, a first 3DS WIN (Women Initiative) Summit
brought together 23 Group representatives globally. An
assessment and a list of priority actions were drafted, in
order to develop the recruitment plan for women at Dassault
Systèmes and have more women in management positions.
At December 31, 2015, 24% of 3DS employees were women,
representing 17% of Managers.
31% of people recruited during the year were women, spread
over the following services: 49% in Sales, Marketing and
Services, 30% in Administration and other, and 21% in R&D. It
is important to highlight that the Group’s ability to hire more
female engineers is very limited as they are under-represented
in engineering schools.
The 3DS WIN (3DS WOMEN INITIATIVE) internal community,
implemented in 2012, continued to coordinate a network of
women and men determined to encourage, inspire and mentor
women to develop their careers within Dassault Systèmes. In
2015, numerous actions were implemented locally including:
a partnership with the Women’s Forum for Economy and
Society; a conference on leadership at the 3DS Paris Campus;
actions to promote the recruitment of women in India; an
inter-company exchange on best practices in North America,
etc.
The Dassault Systèmes Executive Committee is comprised of
two women and eight men while the Board of Directors has
four women members and five men.
in the different countries where
Dassault Systèmes endeavors to comply with applicable
regarding professional equality and non-
regulations
discrimination
it has
employees. The French, German, English, Dutch, American,
Canadian, Japanese, Chinese, South Korean and Australian
companies of Dassault Systèmes, which employ 86% of the
Company’s Employee Headcount, are subject to specific
employment anti-discrimination and gender-equality laws.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
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For example, in France, the agreement regarding equal
professional treatment and balanced employment between
men and women at Dassault Systèmes SE was renewed and
signed on July 9, 2015 for a three-year period.
It covers the following themes: hiring and developing
the professional gender balance, the equal compensation
and pay policy between men and women, promotion and
career development, work-life balance, awareness and
communication campaigns to change mindsets and behavior.
In addition, in order to analyze the positioning of men and
women at Dassault Systèmes SE and to define actions to be
undertaken to eliminate possible inequalities, a report on
the situation comparing general employment conditions
and training for men and women is prepared each year in
accordance with the law. It has been available on the intranet
site since 2010.
Some French subsidiaries have also implemented agreements
on equality or the promotion of diversity (Dassault Systèmes
Provence SAS, Dassault Data Services SAS).
In the United States, Dassault Systèmes ensures compliance
with regulations regarding equality in the workplace (hiring,
training, promotions, compensation, dismissals and any
other decision related to work), in particular Title VII of the
Civil Rights Act. It sends reports of compliance with these
regulations (EEO1, Vet100 and Affirmative Action reports) to
the U.S. authorities each year.
Disabled persons
The French, German, English, Dutch, American, Canadian,
Japanese, South Korean and Australian companies of Dassault
Systèmes, which employ more than 80% of the Employee
Headcount are subject to specific laws on disabled persons.
This is also the case for most of the other European countries
where employees are located.
In France, since the first agreement implemented in 2003
within Dassault Systèmes SE to promote the employment of
workers with disabilities, which created conditions favorable
for their integration, several agreements have been renewed,
the last of which was signed on December 7, 2015 (Insertion
and Employment of people with disabilities within the
Dassault Systèmes Group 2016 - 2017 - 2018).
These agreements reflect Dassault Systèmes SE’s commitment
to make the hiring, training and continued employment of
workers with disabilities a major component of its policy.
At December 31, 2015, 51 known and reported disabled
persons were employed by Dassault Systèmes SE compared
to 48 in 2014. Dassault Systèmes SE is committed to training
and hiring at least 35 disabled persons under all types of
contracts (permanent, fixed term, interns, work-study) over
three years, including at least 12 permanent contracts, for all
types of qualifications.
large number of
Furthermore, a
initiatives concerning
employee support, training and awareness have been
launched:
improving workstations, conferences, videos,
sessions aimed at raising awareness with regard to welcoming
and
integrating disabled employees, etc. Actions with
external service providers have also been carried out, including
partnerships with the protected sector and services on the
3DS Paris Campus.
Access to 3DS Paris Campus for disabled persons was
specifically considered during construction (such as floor
quality, doors, furniture, Eo-guidage signaling, magnetic
loops, accessible meeting rooms, parking lot entrances, for
example).
Since 2011, Dassault Data Services SAS has committed itself
each year to adopt measures supporting the integration and
employment of disabled persons. In 2015, the following
efforts were continued: initiatives in favor of recruitment,
adapting workstations, training and awareness.
There are no specific agreements on this topic for the other
French subsidiaries.
In the United States, the regulations regarding job equality
(see the paragraph above “Professional equality between
men and women”) apply in cases of discrimination against
disabled employees. It is, however, not permissible to ask
about the type of the employee’s disability. As a result, no
data is provided.
Intergenerational agreements
In application of French law, an intergenerational agreement
was signed at Dassault Systèmes SE on October 8, 2013 for a
three-year period.
This agreement extends from the agreement regarding
employing senior employees (agreement signed in 2010),
building on the measures initiated to anticipate career changes,
develop and transfer skills and manage the transition between
working life and retirement. It has now been broadened to
include a component aimed at facilitating the recruitment and
integration of young people within the Company.
An intergenerational agreement has also been put in place at
Dassault Data Services SAS and Dassault Systèmes Provence
SAS for a three-year period and there are corporate action
plans at Netvibes SAS and 3DVIA SAS in particular. There
are no specific agreements for the Quintiq SAS and Dassault
Systèmes Biovia SARL companies.
46 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
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Social and Societal Responsibility
2
2.1.2.3 Developing relations with the social,
regional and community environment
The Foundation
The Dassault Systèmes Foundation was created in the form
of an endowment fund on August 15, 2015 (Official Journal,
announcement no. 1460).
Its purpose is to contribute to transforming education and
research by building on the powerful possibilities of learning
and discovery offered by 3D technology and virtual universes.
The Dassault Systèmes Foundation wants to support the
creation of conditions conducive to developing creative
thinking to harmonize product, nature and life.
Its aim is to:
Company relations with secondary and post-secondary
education
Dassault Systèmes’ relations with the world of education are
aimed at constantly updating teaching methods and fostering
the skills and talents expected by its clients. This effort was
stepped up in 2015.
Training the engineers and technicians required by Dassault
Systèmes’ customers
At the end of 2015, five million pupils and students were using
one or more of the Group’s technologies in an educational
context, mainly in secondary and higher education. The
Company’s efforts have led to the overall broadening of the
user community as well as developing and modernizing their
uses. To date, they include 36,000 institutions worldwide.
(cid:125) actively support the transformation of teaching and
educational innovation particularly through 3D experience
imaging and content;
SOLIDWORKS continued its expansion to a total of 2.4 million
licenses, including a large-scale installation of 20,000 licenses
to the 13 California State University campuses.
2
(cid:125) generate
interest from young people for careers
in
engineering, sciences and digital technologies;
(cid:125) broaden access for schools and universities to 3D
technologies and content, as well as simulations;
(cid:125) encourage scientific and technological research, and
(cid:125) contribute
to
the preservation,
conservation and
enhancement of humanity’s intellectual heritage.
The Dassault Systèmes Foundation grants scholarships and
provides digital content and virtual technology expertise to
education and research projects led by universities, research
institutes or other European general interest organizations.
This support promotes access to 3D technologies which have
been used for a long time by industry to design, develop and
manufacture most of the products on which society is based.
Nine projects were selected in 2015. Eight of the nine projects
were innovative educational initiatives in three types of
schools: engineering schools, schools that provide Professional
Aptitude Certificates, and schools for disadvantaged youth.
The Dassault Systèmes Foundation also supports an ambitious
international scientific mission that aims to use the most
recent technologies and 3D simulation to understand how the
Kheops pyramid was built.
The Dassault Systèmes Foundation focuses its general interest
mission on society to build a better future in a constantly-
changing world.
The academic skills certification program for CATIA was
completely remodeled and includes a group of 86 certification
centers in France, Spain, the United States, Canada, Japan,
China and South Korea.
The program for the creation of education expertise centers
(“PLMCC”),
joining Dassault Systèmes and the French
Ministries of National Education and of Higher Education and
Research, was extended by the addition of two new sites, in
Mexico at the Technological University of Aguascalientes and
in Argentina, at the National University of Cordoba. In Mexico,
the center serves 125 institutions where 100 teachers have
already been trained to use Dassault Systèmes solutions. In
Argentina, 2,000 teachers and students have access to these
solutions. In order to encourage greater interest in the sciences
and technology, and contribute towards reversing the trend
of disinterest among young people for these disciplines in
France, the multidiscipline Course en Cours competition has
maintained its level of participation across France and French
high schools abroad, with 11,000 secondary and high school
students taking part.
Facilitating educational innovation
The development of new educational practices implementing
Dassault Systèmes’ solutions took on a new dimension in
2015 with the creation of a “Learning Lab” on the 3DS Paris
Campus in Vélizy. Numerous directors of academic institutions
worldwide have visited this lab to discover new learning
experiences which replicate real
life experiences which
students can apply to their future work environment.
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One of the many new uses of the Learning Lab illustrated
by the Company is the increasing number of internet-based
educational activities on industrial objects. New activities that
draw more from the 3DEXPERIENCE platform in this area
include the use of the humanoid robot, “Poppy”, an open
source system that creates numerous learning scenarios.
In the area of scientific research, an innovative geology project
was completed with La Salle Institute in Beauvais. This project
broke new ground in the modelling of lava cooling phenomena
and created new frameworks for students’ practical work. In
particular, the project validated the transferability of industrial
in
life cycle management methods, generally practiced
industry, to the scientific domain.
Dassault Systèmes provided an international consortium of
universities and engineering schools, led by the Metz National
Engineering School, assistance and tools necessary to the
implementation of the “Digital Farm”, a one-of-a-kind project
for the collaborative design of a precision agriculture solution.
This project brought together 14 universities, engineering
and agronomy schools, with students from 11 countries and
across four continents, using diverse engineering skills to
leverage the social and technical collaboration environment
provided by the 3DEXPERIENCE platform.
la Formation des Ingénieurs (European Society for Engineer
Training (SEFI), the International Federation of Engineering
Education Societies (IFEES), the Global Engineering Deans
Council (GEDC), the Indian Society for Technical Education
(ISTE), the European SchoolNet, the National Academy of
Engineering and the Association Française d'Ingénierie des
Systèmes (French Association for Systems Engineering).
Dassault Systèmes also cooperated with the ICEE (Indo-US
Collaboration on Engineering Education) which works towards
modernizing technical educational practices in India.
Facilitating open innovation, collective intelligence
The 3DEXPERIENCE Lab is Dassault Systèmes’ open innovation
laboratory that was officially announced on November 9,
2015. Its objective is to invent unique breakthrough products
and services mixing different sectors, driven by its ambition to
move society forward.
This system is based on the strong conviction that breakthrough
projects are born out of collective intelligence. Its aims is to
incubate projects in partnership with players including start-
ups, and research or innovation laboratories. This implies a
new dynamic which will give these projects greater scope, as
well as encompassing the idea of societal transformation.
Through projects financed by the European Union and the
Agence Nationale de la Recherche (National Research Agency),
Dassault Systèmes has provided its expertise and solutions to
different educational innovation projects:
The 3DEXPERIENCE Lab supports projects based on themes
from everyday life, i.e. cities, life styles and modes, life
sciences, connected objects, the ideation (idea creation)
process, and “Fab Labs”.
(cid:125) conclusion of “Manuskills”, an international project led
by the Polytechnic University of Milan, to increase the
outreach of manufacturing industries;
(cid:125) continuation of “PLACIS”, led by the Paris Institut supérieur
de mécanique (Higher Institute for Mechanics) with the aim
of developing an international program to train systems
engineers;
(cid:125) initial findings of the European collaborative robotics
project, EURLAB, headed by the Louis Armand High
School in Nogent-sur-Marne, France, involving high school
students in Germany and Italy in a first phase.
These research activities enable full use of the possibilities
offered by the latest version of the 3DEXPERIENCE solutions
on the cloud, solutions which saw their first rollout in most of
the countries where the Group operates.
The 3DEXPERIENCE Lab program will give start-ups the most
advanced professional software on the market, a dedicated
collaborative cloud area, and a user community. In addition,
start-ups will receive high level mentoring to support their
digital projects.
The unique market positioning of the 3DEXPERIENCE Lab
program is also reflected in the possibility of giving these start-
ups access to the networks and connections with Dassault
Systèmes’ extended ecosystem at an international level.
Finally, the 3DS Paris Campus welcomes these start-up
founders to the 3DEXPERIENCE Lab with a dedicated area for
training and coaching, the availability of high performance
equipment, and a Fab Lab for fast prototyping of parts.
(For more information, http://3dexperiencelab.3ds.com/en/).
All of these activities were supported by the active
collaboration of the Group in conjunction with a number of
scientific associations including the American Society for
Engineering Education (ASEE), the Société Européenne pour
Company commitment to associations
Dassault Systèmes is involved with associations to support
the virtual economy and encourage sustainable innovation.
To promote the development of the digital economy in France
48 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
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Social and Societal Responsibility
2
and in Europe, Dassault Systèmes is a founding member of
AFDEL (Association Française des Éditeurs de Logiciels, the
French Association of Software Editors). The goal of this
association is to promote the software industry as an industry
that contributes to sustainable growth. Dassault Systèmes also
co-chairs the Alliance for the Industry of the Future in France,
of which the AFDEL is a founding member. This Alliance helps
promote the transformation of French production tools and
support companies in transforming their business models,
organizations, design modes and marketing. The Group also
supports the “Villette-Universcience Company” in France,
whose goal is to promote and encourage the diffusion of
scientific and technical culture to young people and to the
general public. Throughout the world, Dassault Systèmes
brands are involved in local community efforts.
Finally, the Company spearheaded an initiative to provide
support for education and economic development in Rwanda.
The project’s initial objective was to provide students with CAD
program skills, with SOLIDWORKS contributing the licenses
and teaching programs. The program has evolved into helping
participants structure and manage businesses by providing
modeling services, and subsequently creating demand for
such services.
Social projects
In France, Dassault Systèmes SE subsidizes its Works Council
in the amount of 5.2% of total gross annual payroll , with
5.0% for social and cultural activities and 0.2% for the
operating budget. In 2015, the Works Council thus received
€10.5 million, compared to slightly more than €9.1 million in
2014 and €8.5 million in 2013.
This yearly allocation by Dassault Systèmes SE allows
employees, as well as their spouses and children, to be offered
a large range of social and cultural activities with many
sections dedicated to specific domains from sports to art, as
well as financial support, such as for vacations, children’s
education, and membership in clubs.
Dassault Data Services SAS subsidizes its Works Council at
a level of 1.5% of its total gross annual payroll , with 1.3%
for social and cultural activities and 0.2% for the operating
budget.
Dassault Systèmes Provence SAS subsidizes its Works Council
in the amount of 1.8% of total gross annual payroll , with 1.6%
for social and cultural activities and 0.2% for the operating
budget.
2
2.1.3 Welcoming employees who have joined the Group via recently
acquired companies
Due to the strong growth, speeding up the onboarding of
employees joining the Group is a major challenge.
The goal is to share a common strategy and set of processes,
culminating in the integration of the products into the
portfolio.
For this purpose, Dassault Systèmes has defined a methodology
and processes aimed at implementing an integration plan.
This plan takes place in three stages:
(cid:125) the preparation of the finalization of the acquisition, which
defines the integration strategy;
(cid:125) a communication program on the date of the signature and
a convergence plan for each function with an associated
schedule. This plan is co-drafted by the teams of the
acquired company and Dassault Systèmes based on a value
analysis of the respective processes;
(cid:125) the implementation of the convergence plan at a rate that
can vary depending on the acquired companies. This goes
from the adoption of Dassault Systèmes’ processes up to
the complete integration of the legal entities.
Throughout this process, a project monitoring system
is leveraged to manage the progress, allowing for plan
modifications if necessary. Feedback is solicited to continually
improve the process. For example, in 2015, integration
perception surveys were conducted with employees from
newly acquired companies.
Each integration process is adapted specifically to each
acquired company, with the aim of motivating and building the
loyalty of talented individuals and providing each employee
with learning opportunities.
This methodology is based in particular on the 3DEXPERIENCE
platform as well as the online communities which provide
easy access to the information concerning the Company,
organizations
the
responsibilities, competencies and contributions of each
person.
and projects, while highlighting
A team of employees from Dassault Systèmes as well as the
acquired company is formed to conduct this convergence
project focusing on different processes: R&D and Customer
Support, Sales and Marketing, Finance, Sales Administration,
Human Resources, IT and Working Environment.
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2 Social, Societal and Environmental Responsibility
Social and Societal Responsibility
2.1.4 Rewarding P erformance and R ecognizing E mployees
As part of the performance evaluation process, each employee
meets his or her manager on a formal basis at least twice a
year, to define goals for the year and to assess the results of
the past year. A mid-year review is also recommended. These
discussions relate to rewards and recognition attributed to the
employees for their performance and contribution to Dassault
Systèmes’ development.
Dassault Systèmes also values initiatives with particular
attention paid to the spirit of innovation as well as collective
and social actions:
(cid:125) innovations developed within the Group by the teams, in
all organizations, are showcased in the 3DS Innovation
Forwards, that, each year, reward the most innovative
projects put forth by employees worldwide;
(cid:125) programs and initiatives are put into place to recognize the
employees’ hard work and enhance the work environment;
(cid:125) Dassault Systèmes also recognizes the importance of being
a strong corporate citizen, and actively participates and
encourages employees to contribute to community based
activities.
Performance and compensation
Compensation
The compensation policy at Dassault Systèmes seeks to ensure
that each employee receives compensation consistent with
market practices in the advanced technology industry in each
country where the Company has operations. Compensation
is differentiated according to the individual performance of
each employee as appraised by his or her Manager during an
annual interview reviewing performance and goals.
Increases take place for the entire Company in April each year.
All the employees who were with the Company on October 1
of the preceding year are eligible for an annual salary increase.
In 2015, the salary increases granted by Dassault Systèmes
depended on individual performance and market changes in
each country where the Company has activities.
Total gross annual payroll paid by the Group (including for
the employees of 3D PLM Software Solutions Ltd and 3DPLM
Global Services Private Ltd) amounted to €1,019.0 million in
2015 compared to €822.7 million in 2014, an increase of 24%
for the year, principally due to negative currency effects and to
the addition of acquisitions.
Payroll taxes for the Group amounted to €254.5 million in
2015 compared to €228.9 million in 2014. In 2015 and 2014,
payroll taxes included an amount directly related to a grant of
performance shares.
Profi t-sharing (pursuant to Titles I and II of Book III, Section
III of the Labor Code)
Employee profit-sharing (l'intéressement) and regulatory
profit-sharing (la participation) are two employee savings
vehicles established by law in France. Employee profit-sharing
is optional, while regulatory profit-sharing is required for all
companies with more than 50 employees.
The employee profit-sharing and regulatory profit-sharing
agreements renegotiated by Dassault Systèmes SE with the
labor unions in 2014 are applicable for three years (2014,
2015 and 2016).
Employee profit-sharing for the year 2014, which was paid
in 2015 at Dassault Systèmes SE, amounted to €17.9 million
(€18.4 million in 2013). The total amount of the contribution
by Dassault Systèmes SE for regulatory profit-sharing for
the year 2014, which was paid in 2015, was €17.9 million
(€15.5 million in 2013).
The results of operations recorded by Dassault Systèmes SE
for the year 2015, and which will be submitted for approval
at the General Shareholders’ Meeting on May 26, 2016
should permit the distribution of employee profit-sharing and
regulatory profit-sharing of €21,163,228 each.
The table below sets forth the amounts of employee profit-sharing and regulatory profit-sharing at Dassault Systèmes SE over
the past three years:
2015
2014
2013
(in thousands of euros)
Amount
% payroll
Amount
% payroll
Amount
% payroll
Contractual employee profit-sharing
(intéressement)
Regulatory profit-sharing (participation)
TOTAL
21,163
21,163
42,326
11.0%
11.1%
22.1%
17,921
17,921
35,842
10.5%
10.4%
20.9%
18,422
15,512
33,934
12.0%
10.2%
22.2%
Payroll percentages are calculated on a capped payroll base as per the current profit sharing agreements.
50 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
The amounts attributed individually to employee beneficiaries
are, at the employee's option
either directly received,
contributed to one of the Company’s savings or group
retirement plans, or deposited (only possible for regulatory
profit-sharing) in a blocked bank account bearing interest at
110% of the average interest rate on private bonds (Taux de
Rendement Moyen des Obligations Privées).
At Dassault Data Services SAS and Dassault Systèmes
Provence SAS, the amount of contractual employee profit-
sharing paid in 2015 in respect of year 2014 represented
9.1% and 6.1% of the payroll respectively, and the regulatory
profit-sharing represented 1.9% and 18.9%. Optional profit-
sharing agreements were also signed in 2013 and contractual
profit-sharing agreements in 2014 in Netvibes SAS and 3DVIA
SAS. These contractual employee profit-sharing agreements
(intéressement) represented respectively 17.5% and 8.4% of
the payroll of these companies. There are no agreements at
Quintiq SAS and Dassault Systèmes Biovia SARL.
Other plans
In Canada, there is a “Deferred Profit-Sharing Plan” (DPSP)
which allows a portion of profits to be distributed to employees
registered on the “Registered Pension Plan” (RPP).
Recognizing the fl air for innovation and showcasing
collective initiatives advocated by the values of
Dassault Systèmes
3DS INNOVATION Forwards
Every year, the 3DS INNOVATION Forwards reward the
most innovative projects led by Dassault Systèmes’ teams
worldwide. Launched in 2004, the initiative encourages a
spirit of innovation within the Group, promotes recognition,
and deepens understanding of the corporate strategy. The
proposed projects are designed to provide solutions for the
Company’s strategic issues: contributing to meet industry
challenges, creating new user experiences enabling them to
see the advantages of the products made by the Dassault
Systèmes brands, participating in the Company’s commitment
to its customers and partners, increasing the value of the
3DEXPERIENCE platform, offering new experiences that
contribute to the development of the Group’s employees and
its business activities, etc.
All Dassault Systèmes employees are invited to submit a
full description of the project within a dedicated on-line
community, set up on the 3DEXPERIENCE platform. The
projects can be seen by everyone and are selected via an
employee vote and a jury made up of members of the
Executive Committee. There were 250 applicants in the 2015
edition of the competition representing 1,799 employees,
with 25 winning teams.
Initiatives to reward work and improve the lives
of employees
Since 2010, an internal satisfaction survey has been open
to all Dassault Systèmes employees worldwide. This survey
Social, Societal and Environmental Responsibility
Social and Societal Responsibility
2
enables employees to give their opinion about various themes
such as well-being at work, mutual respect, collaboration,
pride in working for Dassault Systèmes, etc. Following the
annual survey, a specific action plan is implemented at the
global or local levels to encourage progress year over year.
The global action plan is based on a catalogue of 40 initiatives
from best practices tested within the organizations. The
initiatives are classified according to three major themes
which are:
2
1) recognition and celebrations,
2) the learning company and
3) the working environment.
To promote the action plan and enrich the initiative catalogue,
a worldwide on-line community - called life @3DS- was
opened to all in November 2015. Each employee can thus
discover, exchange and propose new ideas.
Collective company and social initiatives
Most of the Group’s subsidiaries organize or take part in local
initiatives within their communities.
This involves taking part in sporting events to collect funds
for various charity organizations. For example, the “Paris
to London cycle ride” in the United Kingdom, including the
collection of donations for the “Prince’s Trust” organization
helps people from 13 to 30 years old in education or
employment. Employees also participated in the “Mekong
Challenge” running race in Belgium to collect funds to
improve the life of poor children in South-East Asia. Finally,
the “Montreal-Quebec” cycling race contributed to cancer
research .
Actions supporting children were also carried out. In Germany,
donations were made to the F.U.N.K.e.V charity, which
supports the neuropediatric department in Stuttgart Hospital.
In France, Dassault Systèmes is a partner in the “Rêves de
Gosse: Tour 2015” initiative which offers “extraordinary”
children (sick children) the opportunity to go on a first flight
organized by amateur and professional pilots. In the United
States, toys were collected and donated. Also in the United
States, employees volunteer days with non-profits, such as
the “Ronald Mc Donald House” whose aim is to facilitate the
hospital stay for seriously ill children.
Initiatives in favor of disabled persons: in South Korea, Dassault
Systèmes conducts an intern program for disabled students in
partnership with the “Korea National University of Welfare”.
In France, again within the “Rêves de Gosse” initiative,
the disability taskforce sponsored and staffed a booth and
organized conferences in schools in the Yvelines département
as well as a flight simulator competition with teams including
with disabled employees.
Sustainable development actions are also carried out globally.
For example, in France and the United States IT and electronic
equipment is collected by employees for recycling. In Canada,
volunteer days are held at the Peter McGill Eco-Quarter
DASSAULT SYSTÈMES ANNUAL REPORT 2015
51
2 Social, Societal and Environmental Responsibility
Social and Societal Responsibility
program, whose mission is to encourage Montreal inhabitants
to improve daily the quality of their living environment and
reduce the impact of their life styles on the environment.
Finally, support has also been extended to local organizations
via the “SnowFlake” initiative in the United States that collects
winter clothes, and “Sow Much Good”, an agricultural farm
that grows and distributes vegetables to local populations.
2.1.5 Business ethics, social dialogue and personal safety
(cid:125) using Dassault Systèmes’ funds or assets to pay bribes or
kickbacks or make payments of a similar nature liable directly
or indirectly to benefit third parties, including shareholders
or companies, whether they are partners, customers,
suppliers, service or other companies or organizations, with
the goal of benefiting from preferential treatment; and
(cid:125) using Group funds to make a contribution of any kind to
political candidates or parties.
These principles are supplemented by an “anti-corruption
policy”, which applies to each Dassault Systèmes company.
Principles of Enterprise Social Responsibility and
commitments to ensuring respect for basic rights
The Code of Business Conduct requires Dassault Systèmes’
employees to comply with international standards, such
as the Universal Declaration of Human Rights of the United
Nations and the various Basic Conventions of the International
Labor Organization. With respect to the Group’s activities,
the risk of these basic standards being violated is very low
and the actions undertaken to support human rights are not
specifically reported on.
The Group also promotes corporate responsibility with respect
to its ecosystem, based on the acknowledgment of and
compliance with basic laws on social rights and environmental
protection; the general terms and conditions of the sub-
contracting and purchase agreements of Dassault Systèmes’
major companies include specific commitments:
(cid:125) the Dassault Systèmes SE model contracts oblige its
service providers to follow the social and environmental
responsibility principles which Dassault Systèmes uphold.
They are available at the following link: http://www.3ds.
com/fileadmin/COMPANY/Ethics-and-compliance/
Principes-de-Responsabilite-Sociale.pdf;
(cid:125) the agreements between Group entities in France, Germany,
the United Kingdom, the Netherlands, the United States,
Canada, Japan, China, South Korea, India, Australia and
other European countries (which account for 73% of the
Group’s Employee Headcount) and their service providers
contain clauses regarding respect for employees’ rights.
Business ethics
Since its creation, Dassault Systèmes has developed its
culture and built its reputation on different fundamental
principles, particularly the creation of long-term relationships
with its employees, customers, partners and shareholders,
as well as high-quality products with high added-value.
Confidence and integrity, supported by rigorous ethics and
regulatory compliance, are at the heart of Dassault Systèmes’
commitments for sustainable innovation and growth.
is
formalized
The Company’s commitment to professional ethics and
business citizenship
through procedures
regarding corporate governance, in particular the “Code of
Business Conduct” distributed to all the Company’s employees
(see paragraph 5.1 “Report of the Chairman on Corporate
Governance and Internal Control”) and “DS Principles of Social
Responsibility” on the Company’s internet site. The Code of
Business Conduct, which is backed up by specific policies, is
intended to serve as the reference for all Company employees
to guide their behavior and interactions when performing their
activities.
This commitment is also borne out by the policy of making
new employees aware of ethics and compliance and by
targeted training courses taken by the employees most
exposed to ethical risks in their daily duties.
The online ethics and compliance training, created in 2013,
is now an integral part of the onboarding program for all new
employees. This course comprises 14 modules, each of which
is broken down into a theory section followed by practical
applications in a question/answer format. The topics dealt
with include the fight against corruption, the protection of
intellectual property, respect for confidentiality, ethics in the
workplace, competition law, information systems security,
personal data protection, and conflicts of interest etc.
The fi ght against corruption
The Code of Business Conduct prohibits Group employees
from:
(cid:125) exchanging gifts or invitations in order to favor or influence
a business decision, whether it be taken by a customer,
partner, supplier or employees of the Group;
52 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Social, Societal and Environmental Responsibility
Social and Societal Responsibility
2
Dassault Systèmes requests that its suppliers and partners
comply with the provisions of the basic conventions of the
International Labor Organization, in particular the principles of
eradicating child labor by requiring children to attend school
(and in any event under 15 years of age), eliminating forced
labor, ensuring working conditions sufficient to provide for
employee health and safety, respecting applicable minimum
legal or regulatory levels of pay, freedom to unionize and
the protection of labor union rights, and the freedom to
collectively negotiate labor contracts. The Company also
asks them to commit to ban all forms of discrimination (with
respect to recruitment, professional development and the end
of labor relations), to fight against corruption, and to respect
applicable law on the protection of the environment.
Impact of products and services on the health and safety of
the Group’s customers
The direct impact of Dassault Systèmes’ products and services
on the health and safety of its customers is very limited given
their non-material nature. They are therefore not specifically
reported on.
Social dialogue and collective agreements
The quality of the social dialogue is based on the numerous
exchanges between the Company’s management and the
employees and employee representatives.
In France, numerous meetings were organized by the relevant
French companies of the Group. Collective agreements,
concerning one or several subjects in connection with working and
employment conditions, were negotiated and signed each year:
2
Dassault
Systèmes
SE
Dassault
Data
Services
SAS
Dassault
Systèmes
Provence
SAS
Netvibes
SAS
3DVIA
SAS
Quintiq
SAS
Dassault
Systèmes
Biovia
SARL
Simpack
France
SAS
Number of collective agreements in effect at 12/31/2015
Number of collective agreements signed during 2015*
41
4
25
7
14
5
3
1
2
1
0
0
0
0
0
0
*
These agreements may cover several topics such as the Mandatory Annual Negotiations, equality and professional gender balance, organizing working time, contractual employee
profit-sharing and regulatory profit-sharing, and the inclusion and employment of people with disabilities.
Note: there are no agreement for Quintiq SAS, Dassault Systèmes Biovia SARL and Simpack France SAS.
In Germany, collective agreements are negotiated and signed
with the Group Council and the Workers’ Council of each
Company site (Stuttgart, Hanover, Aix-la-Chapelle, Berlin and
Simpack). At December 31, 2015, there were 9 agreements
in effect in Stuttgart, 27 in Hanover, none still in effect at
December 31, 2015 in Aix-la-Chapelle and Berlin, and 19 with
the Group Council.
In 2015, Dassault Systemes Deutschland GmbH signed 9
agreements at the level of the Group Council, several of which
concern employee salaries and human resources management.
Also, agreements were signed at a local level, including one in
Stuttgart on similar topics.
In the other main countries where the Group operates (the
United Kingdom, the Netherlands, the United States, Canada,
Japan, Malaysia, China, India and Australia), there is no
personnel representation or trade union in Dassault Systèmes.
In South Korea, as in all companies with over 30 people, an
employee representative Committee is elected each year.
Its role is to participate in organizing the Company’s social
activities.
Furthermore, the negotiations begun in October 2014 with
the Special Negotiation Body (“SNB”), which was formed
as part of the project to convert Dassault Systèmes SA into
a European company, led to the signing of a unanimous
agreement governing the terms and conditions for employee
involvement within the European company. This new
Committee for dialogue with its European employees (the
European Works Council) will consist of 22 representatives
from the 16 European countries in its jurisdiction. The body’s
first plenary meeting is scheduled for the end of the first
quarter of 2016.
Health and safety
In accordance with the provisions of its Code of Business
Conduct, the Group undertakes to comply with all applicable
laws and regulations on health and safety in the workplace.
Coverage of healthcare costs
its employees has
The Group ensures that each of
medical coverage in compliance with local practices in the
countries where it has activities. Moreover, the Group offers
supplementary health coverage, for example in France, the
United Kingdom, the United States, Canada, South Korea,
Japan and India.
Health and medical checkup
The Group applies the provisions laid down by the countries
where it has activities.
For example, in France, its employees undergo regular medical
checkups. On the 3DS Paris Campus, a medical team composed
of two physicians and four nurses looks after the health and
well-being of all on-site employees. In certain other countries
(the United States, Japan, China, and South Korea), individual
medical checkups are offered. This service is included in the
health coverage plan. Lastly, there are no specific provisions in
Germany, the United Kingdom, Canada, Malaysia, or Australia.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
53
2 Social, Societal and Environmental Responsibility
Social and Societal Responsibility
Work accidents
Given the nature of Dassault Systèmes’ activity, few work
accidents are recorded. In France, in 2015, ten work or travel
accidents resulted in absence from work for more than one
day. There were six in Germany, four in the United States,
one in Japan, one in China and none in the United Kingdom,
the Netherlands, Canada, Malaysia, South Korea, India, and
Australia.
Health, Safety and Working Conditions Committee and
specifi c actions
In France, three Group companies have a Health, Safety and
Working Conditions Committee (CHSCT in French), which
meets several times during the year in each entity.
Since 2009, Dassault Systèmes SE has launched a series of
initiatives to promote well-being in the workplace for all
of its employees. To remind them of the information and
documents available on this topic (specific processes, training
for the prevention of stressful situations, consultation with
a psychologist or social worker, etc.), an announcement was
sent to all employees at the beginning of the year so that
everyone is aware of the tools made available to them by the
Company.
At Dassault Systèmes Provence SAS, the actions implemented
in 2014 through four working groups continued in 2015 for
the following themes: “Objectives, planning and reporting”,
“Helping each other, support and sharing expertise”, “Value
recognition, career and skills development”, and “Planning and
organizing techniques”. Recommendations were prepared by
each of the groups. These resulted in action plans submitted
to and monitored by the CHSCT.
In addition, in certain countries (such as Canada and Germany),
employee representatives are responsible for communicating
with the management of the relevant legal entities on
employee health and safety.
2.1.6 Methodology for Employee Reporting
Scope
In general, employee reporting covers all Dassault Systèmes
companies at year end. Nevertheless, as indicated below, the
scope covered for certain indicators may be more limited.
Key employee indicators
For its employee reporting requirements, the Group chose key
indicators set out in paragraphs 2.1.1 “Group Organization
and Employees” and 2.1.7 “Appendices regarding the Group’s
Employee Headcount”. They were chosen on the basis of the
indicators in article R. 225-105-1 of the French Commercial
Code and the specific indicators in the Group’s Human
Resources policy.
In this respect, Dassault Systèmes has defined the following
concepts:
(cid:125) “Employee Headcount”, which means employees of
Dassault Systèmes SE and subsidiaries in which it has at
least a 50% shareholding; and
(cid:125) “Total Workforce” which includes the Employee Headcount,
employees of companies in which it has less than a 50%
shareholding and outside service providers who have worked
more than a full month at period end. At December 31,
2015, the Employee Headcounts for companies in which it
has less than a 50% shareholding include the employees of
3D PLM Software Solutions Ltd and 3DPLM Global Services
Private Ltd.
Data related to employees is calculated on the basis of “full-
time equivalents”, which corresponds to the proportion of
“hours worked per standard full-time work hours” and which
was jointly defined and shared by both Human Resources and
Finance teams. Hiring and departure data are also determined
using this rule for 2015. The 2014 data in relation to these
indicators, which were originally denominated in number
of work agreements, were recalculated using the same
methodology.
To make the reporting process more reliable, an internal
methodological guide including definitions and rules for
calculating each indicator is updated each year. Data reliability
checks are carried out at the time of accounting consolidation
as well as throughout the year in connection with analyzing
changes from the preceding periods.
Limits of the social report
The Company operates in numerous countries with local
regulations and practices which are not always harmonized
or consolidated. For example, as the notions generally used
in France to define socio-professional categories (cadre and
non-cadre) are not used outside France, and over two-thirds of
the Dassault Systèmes employees work abroad, the Group has
decided to use the following categories: “Managers” who are
in charge of the teams, and the “Non-Managers” who do not
manage a team and are specialists in a specific field.
54 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Social, Societal and Environmental Responsibility
Social and Societal Responsibility
2
2
Due to these local differences, the Company is not able to
provide consolidated data for overtime, the severity of work
accidents and occupational illnesses.
Gathering and consolidating employee data
T he following points should be taken into consideration:
(cid:125) the data pertaining to employees and movements are taken
from human resources and financial management software,
both of which are deployed across all the companies and
represent 100% of the reporting scope;
(cid:125) the information pertaining to the compensation policy
relates to Employee Headcount. The data relating to the
total payroll and payroll taxes is provided by the Dassault
Systèmes Finance department and covers the Employee
Headcount and the employees of companies in which the
Group has a shareholding below 50%, including employees
at 3D PLM Software and 3DPLM Global Services Private Ltd;
(cid:125) the data relating to employees and the amount of the
payments made to outside service providers is provided by
the Finance department. It concerns services referred to
as “Times and Material”, supporting a Dassault Systèmes
activity corresponding to its core business and in respect of
which the employees are present for at least one month,
paid on an hourly, daily or monthly basis;
(cid:125) the information pertaining to policies on business ethics,
fighting corruption, the Company’s social responsibility
principles and commitments ensuring basic rights and the
impacts of products and services on the health and safety
of the Group’s customers is provided by the ethics and
Compliance department and covers 100% of the reporting
scope;
(cid:125) the data relating to the main policies concerning industrial
relations, health and safety, anti-discrimination initiatives,
employee and regulatory profit-sharing and other reward
systems, working time, absenteeism, fostering diversity
and gender balance, and social projects result from
additional discussions held with the Human Resources
managers in Dassault Systèmes’ major countries with
over 150 employees (excluding companies acquired in
2015), namely France, Germany, the United Kingdom, the
Netherlands, the United States, Canada, Japan, Malaysia,
China, South Korea, India, and Australia. These countries
represent 91% of the Group’s Employee Headcount in
2015. Absenteeism data includes sick leave, maternity
and paternity leave, as well as work-related accidents.
Employees absent for a period exceeding two years are no
longer included in the absenteeism ratio. It should be noted
that this data is strongly influenced by local regulations; in
certain countries, sick leave is counted as paid holiday leave.
As such, absenteeism should be considered on a country-
by-country basis as it cannot be disclosed on a consolidated
basis;
(cid:125) the data relating to training for the countries with over
150 employees mentioned above is extracted from the
“3DEXPERIENCE University” solution, excluding companies
acquired in 2015, covers 90% of the Group’s Employee
Headcount. Data recorded through the on-line training
platform is also taken into account for the same companies.
The data for companies acquired in 2014 and belonging
to the BIOVIA and QUINTIQ brands are derived from their
respective information systems and were consolidated with
data from the 3DEXPERIENCE University;
(cid:125) lastly, the scope is specified in the body of the text for the
other data not previously disclosed: Company relations
with secondary and post-secondary education, Company
commitment to non-profit organizations, 3DS INNOVATION
Forwards, initiatives to reward work and improve the lives of
employees.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
55
2 Social, Societal and Environmental Responsibility
Social and Societal Responsibility
2.1.7 Appendices regarding the Group’s Employee Headcount
DISTRIBUTION BY AGE
Year ended December 31
< 30 years old
31 to 40 years old
41 to 50 years old
> 51 years old
TOTAL
Europe
Americas
Asia
Total
Total
Employees
2015
Employees
2015
%
Employees
2015
%
Employees
2015
%
Employees
2014
%
1,203
1,988
1,745
1,051
5,987
20%
33%
29%
18%
100%
423
945
1,086
1,070
3,524
12%
27%
31%
30%
342
854
531
184
17%
45%
28%
10%
1,968
3,787
3,362
2,305
17%
33%
30%
20%
1,923
3,809
3,229
2,052
100%
1,911
100% 11,422*
100%
11,013
100%
%
17%
35%
29%
19%
*
Indicator verified by the independent verifier.
EMPLOYEE TENURE
Year ended December 31
Temporary contract
Less than 5 years
6 to 15 years
More than 16 years
TOTAL
Europe
Americas
Asia
Total
Total
Employees
2015
158
2,818
1,877
1,134
5,987
Employees
2015
8
1,606
1,312
598
%
3%
47%
31%
19%
Employees
2015
12
1,278
532
89
%
0%
46%
37%
17%
Employees
2015
178
5,702
3,721
1,821
%
1%
66%
28%
5%
Employees
2014
178
5,372
3,900
1,563
%
2%
50%
32%
16%
%
2%
49%
35%
14%
100%
3,524
100%
1,911
100% 11,422*
100%
11,013
100%
*
Indicator verified by the independent verifier.
DISTRIBUTION BY SOCIO-PROFESSIONAL CATEGORY
Year ended December 31
Employees
2015
Employees
2015
%
Employees
2015
%
Employees
2015
%
Employees
2014
%
Europe
Americas
Asia
Total
Total
10%
90%
100%
18%
82%
100%
16%
84%
376
2,335
2,711
1,780
6,931
8,711
2,156
9,266
14%
86%
100%
20%
80%
100%
19%
81%
374
2,212
2,586
1,771
6,656
8,427
2,145
8,868
100% 11,422*
100%
11,013
100%
%
14%
86%
100%
21%
79%
100%
19%
81%
Women
Managers
Non-Managers
TOTAL WOMEN
Men
Managers
Non-Managers
TOTAL MEN
Socio-professional category
Managers
Non-Managers
TOTAL
184
1,188
1,372
960
3,655
4,615
1,144
4,843
5,987
13%
87%
100%
21%
79%
100%
19%
81%
100%
144
732
876
553
2,095
2,648
697
2,827
3,524
16%
84%
100%
21%
79%
100%
20%
80%
100%
48
415
463
267
1,181
1,448
315
1,596
1,911
*
Indicator verified by the independent verifier.
56 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Social, Societal and Environmental Responsibility
Social and Societal Responsibility
2
FULL-TIME AND PART-TIME
Year ended December 31
Employees
2015
Employees
2015
%
Employees
2015
%
Employees
2015
%
Employees
2014
%
Europe
Americas
Asia
Total
Total
Full-time
Part-time
TOTAL
Women
Full-time
Part-time
TOTAL WOMEN
Men
Full-time
Part-time
TOTAL MEN
TOTAL
%
98%
2%
2
5,726
261
96%
4%
3,507
100%
1,903
100%
11,136
17
0%
8
0%
286
97%
3%
10,766
247
5,987
100%
3,524
100%
1,911
100% 11,422*
100% 11,013*
100%
1,211
161
88%
12%
1,372
100%
863
13
876
99%
1%
100%
458
5
99%
1%
2,532
179
93%
7%
2,420
166
94%
6%
463
100%
2,711
100%
2,586
100%
98%
2%
100%
4,515
100
4,615
5,987
0%
100%
5
2,648
3,524
2,643
100%
1,446
100%
2
0%
8,604
107
99%
1%
8,346
81
99%
1%
1,448
1,911
100%
8,711
100%
8,427
100%
11,422*
11,013
*
Indicator verified by the independent verifier.
AGE DISTRIBUTION OF NEW ARRIVALS
Year ended December 31
< 30 years old
31 to 40 years old
41 to 50 years old
> 51 years old
TOTAL
Europe
Americas
Asia
Total
Total
Employees
2015
Employees
2015
%
Employees
2015
%
Employees
2015
%
Employees
2014
%
425
237
94
22
55%
30%
12%
3%
778
100%
175
115
104
56
450
39%
26%
23%
12%
152
137
34
10
46%
41%
10%
3%
752
489
232
88
48% 1,192**
31% 1,324**
15%
6%
743**
264**
100%
333
100%
1,561*
100% 3,523 **
100%
%
34%
38%
21%
7%
Indicator verified by the independent verifier.
*
** The figures reported for 2014 are based on the new methodology adopted for the year 2015 for this indicator (see paragraph 2.1.6. “Methodology for Employee Reporting”).
DASSAULT SYSTÈMES ANNUAL REPORT 2015
57
2 Social, Societal and Environmental Responsibility
Environmental Responsibility
2.2 Environmental Responsibility
Since 2010,
the Dassault Systèmes environmental
responsibility strategy has been structured in stages around
the following main areas of focus:
(cid:125) establishment of a global measurement process and
collection of environmental information;
(cid:125) establishment of a collaborative approach
involving
employees called Sustainability Leaders or the Green Team
who participate in initiatives aimed at limiting the impact
of operations;
(cid:125) implementation of projects and industrial partnerships to
assess among customers the benefits of its applications on
the environment.
Systèmes’
Dassault
is
characterized by indirect positive and negative impacts on its
customers and by direct negative impact of its activities on the
environment:
environmental
responsibility
(cid:125) Dassault Systèmes’ software solutions allow its customers
to reduce the environmental impact of their products from
the design stage. They can help reduce the consumption of
raw materials through digital modeling, optimize energy
consumption and working processes and manage the
compliance of products with environmental standards. This
is the positive impact of Dassault Systèmes’ products on the
environment;
(cid:125) the use of the Group’s software by its customers generates
indirect energy consumption for Dassault Systèmes. This
consumption is the potentially indirect negative impact of
Dassault Systèmes’ products on the environment;
(cid:125) all of Dassault Systèmes’ operations are located in offices
(see paragraph 2.2.2 “Responsible Company”) and in data
centers. For its activities, the Group uses computer hardware
and employees are required to travel regularly to the Group’s
sites, and to visit customers and partners. The Group’s
environmental impact is therefore mainly generated by the
energy consumption of its buildings and data centers; the
greenhouse gas emissions produced by employee travel;
and the electrical and electronic waste.
In the light of these various contributions, Dassault Systèmes
is working on the development of a model to define its
overall net positive impact on the environment as defined by
the SHINE Project described in paragraph 2.2.2.2 “Industry
Collaborations on sustainability”.
In 2015, the Group deepened its strategy to integrate the
environment into its operations and structured its initiative
around the responsibilities of the Company and employees
and partners.
2.2.1 The Group’s vision for environmental responsibility
2.2.1.1 An environmental strategy built
on 3 pillars
In 2015, Dassault Systèmes defined the environmental
strategy for its operations for the coming three years. It is
based on the following three concepts:
(cid:125) Responsible Company: Dassault Systèmes helps
its
customers reduce their environmental impact through
its applications while
impact, see
limiting
paragraph 2.2.2 “Responsible Company”;
its own
(cid:125) Responsible Employee: Dassault Systèmes involves its
employees in its environmental strategy through awareness-
raising efforts at all of its sites, see paragraph 2.2.3
“Responsible Employee”;
58 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
(cid:125) Responsible Partner:
the Group strives
to choose
responsible suppliers through the integration of corporate
and environmental commitments, and it is trying to
increase recycling and local actions, see paragraph 2.2.4
“Responsible Partner”.
2.2.1.2
Environmental Management:
Integration of environmental
responsibility into the Group’s real
estate strategy
light of
In
this new vision, environmental strategy
management and the annual reporting thereof was entrusted
to the Group’s Real Estate and Facilities department in
2015, in conjunction with the Public Affairs and Sustainable
Development department, which continues to oversee
partnership development-related tasks to assess the positive
net impact of Dassault Systèmes on the environment through
its applications.
Social, Societal and Environmental Responsibility
Environmental Responsibility
2
2
2.2.2 Responsible Company
2.2.2.1
3DEXPERIENCE platform for
Sustainability: Apps and Solutions
for sustainable development
Dassault Systèmes’ corporate purpose is to provide businesses
and people with 3DEXPERIENCE universes to
imagine
sustainable innovations capable of harmonizing product,
nature and life (see paragraph 1.2.1.3 “Dassault Systèmes’
Purpose and Strategy”).
Companies today face a series of challenges that are
both
technological and ecological. Dassault Systèmes
3DEXPERIENCE platform helps its customers achieve their
combined sustainability and business goals through a portfolio
of sustainability Applications enriching several of its Industry
Solutions Experiences, based on:
3D Modeling Technologies
The Company’s portfolio of modeling technologies makes it
possible to create scientifically accurate representations of the
environmental impacts of product. These technologies also
offer techniques to reduce these impacts, such as eco-design for
predictive environmental assessment and virtual prototyping,
which improve the carbon footprint, energy consumption,
human health impacts, and overall sustainability of products
and systems. For example, SOLIDWORKS Sustainability
features an integrated Life Cycle Assessment (LCA) dashboard
that estimates the environmental
implications of each
design decision using several environmental indicators. One
of the Company’s clients, the global leader in door-opening
solutions, used SOLIDWORKS Sustainability to reduce product
environmental impact and material usage while cutting their
product material and energy costs by 15%.
Virtual+Real Technologies
Technologies that enable real-time realistic simulation can
help optimize the physical world in virtual universes, leading
to reduced environmental impacts. For complex products, the
Company’s simulation technologies aid in performance testing
and light weighting that allows engineers to verify functionality
and conformity while optimizing material usage. Factory and
production systems can be executed with minimal material
and energy expenditure to enable “green” manufacturing.
Ultimately, end consumer usage can be simulated to examine
and reduce environmental impacts across the entire life cycle.
For example, a leading packaging designer used SIMULIA
to simulate complex design interactions, resulting in a 27%
reduction of carbon footprint and plastic resin usage while
maintaining product integrity.
Intelligent Information Technologies
The searching, sorting, filtering, navigating, real-time analysis
and understanding of large amounts of environmental data
are central to the achievement of sustainable innovation. With
the scope of data requirements expanded from the enterprise
to the entire value chain, so-called extended producer
responsibility demands both sophisticated and scalable
access to these big data, allowing information intelligence
impacts
applications that can dashboard environmental
across the extended enterprise. For example, the EXALEAD
search-based infrastructure enables the management of
structured and unstructured environmental data, providing
decision support to execute corporate sustainability and
impact-reduction strategies. Central to the success of these
sustainability strategies is social listening: NETVIBES enables
customers to gauge public sentiment about sustainability
trends and campaigns.
Connectivity Technologies
Connecting data and people by breaking down silos in
strategies.
contributes
organizations
sustainability
to
Connectivity
to build
technologies allow companies
internal and external communities to manage sustainability
efficiently. They also make it possible to connect product data
with governmental data to proactively manage adherence
to government and industry environmental regulations and
standards, such as the Restriction of Hazardous Substances
(RoHS) directive and the management of conflict minerals.
Dassault Systèmes’ solution for environmental compliance
and materials intelligence help maintain a proactive risk
minimization strategy, and make it possible to engage the
people and communities that are critical to the success of
sustainability strategies. For example, one of the Group’s
customers, a leader in test and measurement systems in
electronics and bio-analytic
instruments, uses ENOVIA
Materials Compliance Management (MCM), an automated,
enterprise-wide materials compliance data tracking system,
to demonstrate compliance with stringent environmental
regulations for more than 1,800 products and 160,000 parts
from more than 7,000 suppliers.
Dassault Systèmes is a forerunner in creating 3DEXPERIENCE
for sustainable innovation to help customers achieve a positive
environmental impact on the planet and grow their businesses
DASSAULT SYSTÈMES ANNUAL REPORT 2015
59
2 Social, Societal and Environmental Responsibility
Environmental Responsibility
sustainably. The 3DEXPERIENCE platform lets innovators
truly understand the impact of their ideas and processes on
people and the environment, to achieve the vision of a more
sustainable world.
2.2.2.2
Industry Collaborations on
sustainability
In addition to aiding its customers directly, the Company
engages in several industry collaborations to leverage its
expertise and leadership for the furthering of sustainable
collaboration:
(cid:125) International Aerospace Environmental Group (IAEGTM). The
IAEGTM is a self-governed trade association that represents
most of the global commercial aerospace industry, such as
Boeing and Airbus, as well as the global defense aerospace
industry, such as Lockheed Martin, Northrop Grumman
and Safran group. Dassault Systèmes is working with the
IAEGTM to aid in the development of chemical material
declaration and reporting systems, supplier sustainability
surveys, and the aerospace sector’s official guidance for the
measurement of greenhouse gases (GHGs) under the World
Resources Institute’s GHG Protocol;
(cid:125) Sustainable Apparel Coalition (SAC). The SAC is a trade
organization comprised of brands, retailers, manufacturers,
government, and non-governmental organizations and
academic experts, representing more than a third of the
global apparel and footwear market, and is working to
reduce the environmental and social impacts of apparel and
footwear products around the world. Dassault Systèmes
is engaged with the SAC to provide its leadership in life
cycle assessment (LCA)-based design and footprinting
methodologies, and to advise and assist its customers in
challenges involved with a proactive adoption of the SAC’s
Higg Index. This index is a series of assessment tools that
standardizes the measurement of the environmental and
social impacts of apparel and footwear products across the
product lifecycle and throughout the value chain;
(cid:125) Sustainability and Health
Initiative
for NetPositive
Enterprise (SHINE). SHINE consists of a consortium
of sustainability-focused companies,
including Owens
Corning, Eaton Corporation, Abbott Laboratories, Johnson &
Johnson and Dassault Systèmes, and is led by the Center for
Health and the Global Environment, part of the T.H. Chan
School of Public Health at Harvard. The goal of SHINE is to
revolutionize corporate sustainability strategy by managing
Handprints, or positive impacts, in addition to Footprints
(negative impacts). When a compagny's Handprint is
larged than its Footprint, it is called Net Positive. Dassault
Systèmes is contributing significant support and thought
leadership to aid in the development of a new accounting
standard and management methodology for environmental
Handprinting.
The Company recently co-authored, along with Professor Greg
Norris of Harvard, a SHINE case study detailing the handprints
created in the automotive industry with the application of 3D
60 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
technology. Dr. Norris found that the widespread application
of 3D technology can result in 300-600 million Metric Tons
of CO2 reduction in the automotive industry alone by 2020.
Dr. Norris concluded that “by pursuing measures such as
advanced training in eco-design and increased accessibility
and power of eco-design functions within its design tools, the
Company can enable sectors such as the global automotive
sector to create handprints which are on the order of 10,000
times greater than its own footprint.” The full case study is
available on the Harvard SHINE website, hosted by the Center
for Health and the Global Environment.
2.2.2.3
Inclusion of environmental
considerations in the Company’s
operational locations
Dassault Systèmes chooses its site locations based on the
objectives of supporting growth in the Company’s business and
controlling costs while integrating sustainable development
strategies such as encouraging synergies and collaboration,
reducing the environmental footprint of activities, and
improving employee working conditions. The Company also
seeks to be close to its customers, its partners in research and
principal schools and universities, which are one of the main
sources of recruitment for Dassault Systèmes.
The rationalization of the Company’s facilities is designed to
foster collaboration among both its employees and its partners
and customers by grouping together sites, subsidiaries and
operations throughout a single region or country. This process
has, in particular, led to an audit of the facilities and their usage
conditions, during external growth transactions, in order to
determine steps to be taken in connection with the Group’s
strategy (maintaining the lease, facilities rehabilitation or
consolidation).
Since 2008, the Group has implemented a policy of setting
up its activities in offices certified by the local environmental
standard such as Haute Qualité Environnementale (High
Environmental Quality) in France and LEED in the United
States, or on sites that applied an environmental management
system such as ISO 14001. In 2015, 62% of the Employee
Headcount worked in certified offices compared to 57% in
2014 (this increase comes from offices in companies acquired
in 2014).
Principal Sites
With the exception of facilities totaling 21,000 square meters
belonging to 3D PLM Software Solutions Limited (“3DPLM
Ltd”) located in Pune, India, the Company does not own the
offices it occupies and does not have full ownership rights
over any real estate or building, either directly or through
a lease (see Notes 14 and 25 to the consolidated financial
statements).
At December 31, 2015, the principal sites occupied by Group
companies (except 3DPLM Ltd) in its three geographic regions
are as set forth in the table below (sites > 4,500 sq.m.).
Social, Societal and Environmental Responsibility
Environmental Responsibility
2
Geographic region
Principal Sites
Europe
3DS Paris Campus Vélizy-Villacoublay, France(1)
3DS Munich Rosenheimer, Germany
3DS Bois-le-Duc, the Netherlands
Area
(in m2)
70,000
7,800
6,600
Activities on the site
Headquarters, R&D, Marketing
and sales
R&D, Marketing and sales
R&D, Marketing and sales
Americas
3DS Boston Campus Waltham, Massachusetts, United States(2)
25,000
R&D, Marketing and sales
3DS Providence, Rhode Island, United States
3DS San Diego, California, United States
3DS Montreal, Canada
3DS Auburn Hills, Michigan, United States
Asia
3DS Tokyo, Japan
3DS Selangor, Malaysia
8,800
5,700
5,200
4,600
6,000
4,700
R&D, Marketing and sales
R&D, Marketing and sales
R&D, Marketing and sales
R&D, Marketing and sales
Marketing and sales
R&D, Marketing and sales
(1) Dassault Systèmes occupies in Vélizy-Villacoublay a facility covering 60,000 square meters built in 2008 in accordance with the Group’s specifications. Since 2011, Dassault Systèmes
has rented 10,000 additional square meters in a nearby building. In February 2013, the Company entered into a build-to-suit lease agreement for a new building to expand its
headquarters. Under this agreement the Company has committed to lease an additional 13,000 square meters of office space (see Note 25 to the consolidated financial statements).
(2) The Company has options to lease additional space as necessary at its 3DS Boston Campus.
2
Dassault Systèmes’ world headquarters
located at the
3DS Paris Campus in Vélizy-Villacoublay (France) are certified
as NF Service Sector Buildings – HQE under the HQE (High
Environmental Quality) system. The Group has implemented
real-time monitoring of operation and maintenance incidents
related to the energy consumption of the 3DS Paris Campus
buildings. Construction of the 3DS Paris Campus extension
began in 2015. The Group wishes to apply the same strategy
and obtain NF Service Sector Buildings – HQE certification
under the HQE (High Environmental Quality) system.
The exterior of the 3DS Boston Campus is certified LEED Gold,
and in 2014 the campus received LEED Platinum certification
for its interior. LEED is an American certification awarded to
buildings designed with the goal of optimizing environmental
performance. To optimize
its energy consumption, the
3DS Boston Campus is equipped with condensation boilers
and high-yield air conditioning.
In the rest of the world, buildings in Vancouver and Montreal
(Canada), Singapore, Shanghai (China), Tokyo (Japan), Auburn
Hills (United States), and Stuttgart (Germany) are certified
according to local or international environmental standards.
The Providence site in the United States is currently being
LEED Gold-certified.
2.2.2.4 Dassault Systèmes solutions
for its environmental strategy
COP21: the 3DEXPERIENCity project
In 2015, France hosted the COP 21 or the 21st Conference of
the Parties, which brought together heads of state from around
the world to reach an international agreement against climate
change. During this event, Dassault Systèmes presented
its applications for sustainable cities, the 3DEXPERIENCity
project, which enables the visualization of the Group’s
environmental impact.
The 3DEXPERIENCity team also presented a 3D digital model
of the city of Rennes. Cities are currently facing rapid growth,
which makes managing them more complex. This model
allows future projects and services to be visualized to better
meet their environmental and social challenges.
Application technology: Use of Workplace 3D
to optimize workspace
3D modeling technologies can be used in specialized interior
design application fields. The solution developed by Dassault
Systèmes, HomeByMe, is a free application for the general
public that can position objects such as furniture in a room
of a house. The HomeByMe solution, with its Workplace
3D application, can also be used in a professional context to
place offices in workspaces and assign offices to employees
in a 3D environment. As a result, paper-based processes are
replaced by digital processes, thus avoiding manual re-keying
and optimizing resources. Employees can also visualize their
workspace and propose improvements in terms of comfort.
Finally, and ultimately, the application will be able to integrate
all of the elements of facilities management related to
workspaces, namely air conditioning and energy, to visualize
energy consumption of offices based on the computer
equipment installed.
2.2.2.5 Monitoring and control of the Group’s
environmental impacts
The Group carried out a project to analyze the material nature
of its indicators, focusing, in particular, on the key “primary”
indicators related to its activity. The Dassault Systèmes
primary indicators are electricity consumption, greenhouse
gas emissions and electronic and electrical equipment waste
(WEEE). The remaining indicators are deemed “secondary” and
relate to paper consumption, water consumption and general
waste. (See paragraph 2.2.5 “Methodology for Environmental
Reporting”).
DASSAULT SYSTÈMES ANNUAL REPORT 2015
61
2 Social, Societal and Environmental Responsibility
Environmental Responsibility
In 2015, the Group implemented new actions to control
so-called “primary” indicators (implementation of energy
management software, conducting of energy audits, etc.).
in
the environmental
Data presented
report covers
Dassault Systèmes SE and all companies in respect of which it
has a shareholding exceeding 50%. Globally, all consumptions
including power and water and paper consumptions, as well
as greenhouse gas emissions from the Group grew between
2015 and 2014 driven by the Group acquisitions made in 2014
and integrated in 2015. See paragraph 2.2.5 “Methodology
for Environmental Reporting”.
Electricity consumption (in mWh)
Europe
of which 3DS Paris Campus
Americas
Asia
TOTAL
*
Indicator verified by the independent verifier.
Energy
The information below concerns electricity and natural gas
consumption on Dassault Systèmes sites and in its data
centers. Natural gas consumption represents 4.6% of total
energy consumption.
The Company does not use renewable energy on its sites, but
has included in some of its energy contracts the purchase of
electricity produced by renewable resources for certain sites
(3DS Paris Campus in France in 2015, 3DS Stuttgart and
3DS Munich J Wild in Germany). As a result, consumption of
electricity from renewable energy represents 41% of total
electricity consumption.
2015
34,725
20,247
19,535
2,430
2014
31,380
21,000
21,260
2,000
56,690*
54,640*
Electricity consumption of the 3DS Paris Campus fell by
3.6% between 2015 and 2014. This decrease is attributable
to the implementation of (i) measures to improve the energy
performance of the Campus and of (ii) an energy management
system connected to the technical management of the building
since November 2014. This system allows malfunctioning
equipment to be identified, thus limiting excess consumption.
above. In 2010, the Group launched a process to virtualize its
servers. The “virtualization” of servers leads to better use of
material, savings in space at the data center and a reduction in
power consumed by the infrastructure, and thus a reduction
in greenhouse gas emissions. Dassault Systèmes is far ahead
in this area with more than 90% of the servers at its principal
data center already virtualized.
Electricity consumption grew between 2015 and 2014 in
Europe and Asia as a consequence of the Group acquisitions
made in 2014 and to the Company’s organic growth in those
regions. In Americas, energy consumption decreased thanks
to mild winter temperatures and to the move from the old and
energy-consuming site of Providence to a new LEED Gold-
certified site which enabled to save 85% energy consumption
versus the previous location.
In 2015, pursuant to the EU Energy Efficiency Directive
(2012/27/EU), audits were conducted on 3DS Paris Campus
and Aix en Provence sites in France and on the Bois-le-Duc
site in the Netherlands. To improve energy performance
throughout its real estate facilities, the Group also decided to
deploy additional energy audits across all geographic regions,
auditing, for example, its Meudon-la-Forêt site as early as
2015.
Dassault Systèmes has located part of its servers at several
data centers throughout the world. Energy consumption in
these centers is included in the total electricity consumption
Greenhouse Gas Emissions
Group transportation optimization policy
Since the Company’s business
is publishing software,
transportation is the principal source of its greenhouse gas
emissions.
Dassault Systèmes’ travel policy limits the impact of travel on
the environment. Under this policy, employees are encouraged
to schedule meetings by conference call and video conference
rather than by physical travel, use train travel rather than air
travel for trips under three hours in length, and use economy
class for air travel (the carbon footprint of business class being
substantially greater than for economy class).
Greenhouse gas emissions
To analyze its carbon footprint on a global basis, Dassault
Systèmes uses the “GHG Protocol” (Greenhouse Gas Protocol:
www.ghgprotocol.org).
62 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Social, Societal and Environmental Responsibility
Environmental Responsibility
2
SCOPE 1
Emissions due to on-site natural gas consumption
Total emissions due to the use of company vehicles
Emissions due to the use of company vehicles in Europe
Emissions due to the use of company vehicles in the Americas
Emissions due to the use of company vehicles in Asia
Emissions due to the use of refrigerants
TOTAL SCOPE 1
SCOPE 2
Total emissions due to purchases of electricity
Emissions due to purchases of electricity in Europe
Emissions due to purchases of electricity in the Americas
Emissions due to purchases of electricity in Asia
TOTAL SCOPE 2
SCOPE 3
Total emissions due to employee business air travel
Emissions due to employee business air travel in Europe
Emissions due to employee business air travel in the Americas
Emissions due to employee business air travel in Asia
Total emissions due to employee business travel by train
Emissions due to employee travel by train in Europe
Emissions due to employee travel by train in the Americas
Emissions due to employee travel by train in Asia
Total emissions due to employee travel by personal car in connection with work
Emissions due to employee travel using their personal vehicles in Europe
Emissions due to employee travel using their personal vehicles in the Americas
Emissions due to employee travel using their personal vehicles in Asia
TOTAL SCOPE 3
TOTAL GREENHOUSE GAS EMISSIONS (SCOPES 1 + 2 + 3)
*
Indicator verified by the independent verifier.
2
2015 Metric
Tons CO2
emissions
2014 Metric
Tons CO2
emissions
485
3,990
3,865
–
125
315
670
2,340
2,100
–
240
870
4,790
3,880
11,810
10,090
4,275
6,000
1,535
3,230
5,655
1,205
11,810
10,090
32,630
12,165
12,825
7,640
1,680
180
–
1,500
2,185
640
1,105
440
21,870
8,020
9,210
4,640
1,446
235
1
1,210
2,045
525
1,040
480
36,495
53,095*
25,361
39,331*
Greenhouse gas emissions grew by 35% between 2014 and
2015 and were mainly driven by rising Group’s activities
linked to acquisitions made in 2014 and to the Group organic
growth, which led notably to an increase in business travels.
In terms of carbon intensity by employee, greenhouse gas
emissions increased from 5.2 t CO2 per employee in 2014 to
5.9 t CO2 per employee in 2015.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
63
2 Social, Societal and Environmental Responsibility
Environmental Responsibility
Water consumption
Water consumption (in cubic meters)
Europe
of which 3DS Paris Campus
Americas
Asia
TOTAL
2015
39,235
26,894
40,460
4,510
84,205
2014
29,980
20,624
31,910
4,870
66,760
The data related to water consumption presented above is mainly based on estimates and as such may differ from actual water
consumption (see paragraph 2.2.5 “Methodology for Environmental Reporting – Limitations on environmental reporting”).
General waste treatment
In light of the nature of its business, Dassault Systèmes generates primarily ordinary waste such as paper, cardboard and plastic.
The table below indicates the percentage of employees with access to recycling facilities by geographic region:
Percentage of employees with access to recycling facilities at their work location
Europe
of which 3DS Paris Campus
Americas
Asia
% OF EMPLOYEES WITH ACCESS TO RECYCLING FACILITIES AT THEIR WORK LOCATION
In 2015, the Krakow site in Poland introduced recycling in offices.
Paper and packaging
Paper consumption (in metric tons)
Europe
of which 3DS Paris Campus
Americas
Asia
TOTAL
2015
94%
100%
100%
100%
97%
2014
89%
100%
100%
100%
94%
2015
2014
26
14
15
11
52
28
18
13
8
49
On the 3DS Paris Campus, total paper consumption amounted
to 14 metric tons in 2015 compared with 18 metric tons in
2014. On a per-employee basis, this consumption fell from
7.8kg per employee in 2014 to 6.1kg per employee in 2015,
representing a 22 % decrease. This decrease was mainly due
to the ongoing digitalization of data at the 3DS Paris Campus
and the efficient management of paper consumption by
employees.
64 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Social, Societal and Environmental Responsibility
Environmental Responsibility
2
2.2.3 Responsible Employee
2
Awareness-raising actions
Dassault Systèmes pursues an ongoing policy of employee
awareness by involving them in steps taken to save water and
energy through presentations on environmentally-friendly
gestures and technologies that can reduce the environmental
impact of the Company’s activities.
The process was enhanced across all geographical regions
with the implementation of local initiatives to raise employee
awareness of environmentally-friendly gestures. For example,
on the 3DS Boston Campus, the North American Green
Team organized the Spring Green Week. During this event,
employees were taught about energy efficiency and the
recycling of electrical and electronic waste. On the Providence
site and the 3DS Boston Campus, the employees were also
made aware of the impact of transport, and have been
encouraged to ride their bike to work.
In April and November 2015, for National Disabled
Employment Week and for a one-month period, a “Collecte
Solidaire – Agissons Ensemble” event was held once again
on the 3DS Paris Campus under the joint sponsorship of the
Dassault Systèmes SE Disability Taskforce and the Real Estate,
General Resources, and Environment department. Employees
were asked to bring their own obsolete electrical and electronic
equipment and appliances no longer in working order. The
collected equipment was sent for recycling by a company in
the protected worker sector in the French department of Les
Yvelines and 837kg of equipment was recycled by disabled
employees.
A desk-cleaning was also organized on the 3DS Paris Campus
in December 2015. During this event, employees were
invited to recycle their old paper archives and used supplies
and cardboard at dedicated collection spaces. As a result,
3.8 metric tons of equipment were recycled over one and a
half days by persons with disabilities.
In the Asia Pacific region, a recycling week took place in China,
on the Shanghai and Beijing sites, during which employees
were asked to recycle their computer hardware.
Training
By 2015, Dassault Systèmes defined an employee training
program to raise awareness of the challenges of sustainable
development upon their arrival in the Group. The Company
plans to launch this training program starting in 2016 on its
major sites.
2.2.4 Responsible Partner
Group commitments in favor of circular economy
In 2015, 3DS showed a continued willingness to promote local
actions. For example, during events organized on the Paris
3DS Campus to raise employee awareness, the Group shined
the spotlight on partners that also integrated social and ethical
commitments in the recycling of its electrical and electronic
waste in Europe. Therefore, socially conscious and solidarity-
based companies are given preference wherever possible.
In order to create a positive impact at every Group location,
local contributions that integrate an ethical and/or socially
responsible approach are promoted as soon as possible. In
addition, the Group tends to promote recycling activities
throughout the world and focus on the purchase of
materials and furniture that has been recycled or certified as
environmentally friendly.
Specifi c waste treatment
Dassault Systèmes places significant importance on managing
its computer equipment both in terms of usage and recycling.
The Company’s computer equipment
includes desktop
computers, laptop computers and the servers of its data center
and has received the “Energy Star” certificate. When buying
new material, the Company gives preference to internationally
recognized environmental certificates such as “Energy Star”
and “TCO”.
For example, Dassault Systèmes has entrusted the refurbishing
or recycling of computer equipment for the Europe region to
two socially conscious and solidarity-based companies that
employ people with disabilities near its registered office in
Vélizy-Villacoublay. One of them recycles plastic materials to
produce urban furniture. Dassault Systèmes purchased some
of this urban furniture for its green spaces in 2015, and it
plans to exchange all of its waste baskets for these items made
from recycled material.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
65
2 Social, Societal and Environmental Responsibility
Environmental Responsibility
Specifi c waste
% of specific waste recycled according to environmental standards
Quantity of WEEE(1) recycled according to environmental standards (in kg)
Europe
of which 3DS Paris Campus
Americas
Asia
TOTAL
*
Indicator verified by the independent verifier.
(1) WEEE: Waste Electronic and Electrical Equipment.
2015
100
9,250
6,083
6,307
1,442
2014
100
9,420
8,325
3,020
510
16,999*
12,950*
In 2014 and 2015, all WEEE were recycled according to environmental standards.
2.2.5 Methodology for Environmental Reporting
Methodology and scope of environmental reporting
The Dassault Systèmes Methodology for Environmental
Reporting is summarized in the “Environmental reporting
protocol”. The protocol defines:
(cid:125) the distinction between primary environmental indicators
and secondary indicators;
(cid:125) the methodology
for collecting and consolidating
environmental information;
(cid:125) the scope for collecting environmental data.
In application of the provisions of Article 225 of the law
referred to as “Grenelle II”, the environmental reporting target
scope includes Dassault Systèmes SE and all the companies in
respect of which it has a shareholding exceeding 50%.
The environmental reporting scope fits to the published
indicators and covers the following aspects:
(cid:125) the environmental reporting scope currently comprises
the Group’s main sites for the following indicators: energy
consumption, total greenhouse gas emissions scope 1 and
2, water consumption, general waste treatment, paper and
packaging, and specific waste. In 2014, the environmental
reporting scope covered the sites with over 35 employees,
representing 86% of the target scope described above.
Following the 2015 inclusion of new sites, related to 2014
acquisitions (Accelrys, Quintiq and RTT), the Group decided
to focus on sites over 50 employees, representing 78% of
the target scope.
(cid:125) the environmental reporting scope currently comprises
the Group’s main entities for the total greenhouse gas
emissions scope 3. In 2014, the environmental reporting
scope covered every entity with one site over 35 employees,
representing 74 % of the target scope described above. In
2015, the environmental reporting scope covers the entities
with one site over 50 employees, representing 93% of the
target scope.
Variations related to the locations and to the legal structures
included in the environmental reporting scope, as shown above,
have no significant impact on the primary environmental
indicators; as a consequence, the 2014 opening data were not
restated.
The environmental indicators thus determined for 2015 are
presented in paragraphs 2.2.2 “Responsible Company” and
2.2.4 “Responsible Partner”.
The Company’s environmental reporting may evolve as part
of the ongoing process of improvement undertaken by the
Company, or to take changes in applicable regulations into
account.
Collecting and consolidating environmental data
Environmental data was collected by the Sustainability Leaders
and consolidated by the Dassault Systèmes Real Estate and
General Resources Management based on the environmental
reporting protocol. For selected questions, such as business
travel and data concerning electronic waste, external service
providers were also consulted.
To simplify the consolidation of environmental data, a
dedicated software application was rolled out. This new
solution facilitates the structuring and standardization of
environmental data (regarding all parameters but scope 3 data
66 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Social, Societal and Environmental Responsibility
Environmental Responsibility
2
related to greenhouse gas emissions), like-for-like comparisons
and an increase in the frequency of information collection
from annual to quarterly. The deployment of this application
was finalized in 2014 and has strengthened the management
of environmental performance on a global scale.
Primary indicators are collected on a quarterly basis by the
Sustainability Leaders and are reviewed and published in a
quarterly report issued by the Dassault Systèmes Real Estate
and General Resources department. These indicators are
presented in detail in this report. They are also checked by
the independent verifier and are subject to limited assurance.
Secondary indicators are collected on a yearly basis by the
Sustainability Leaders.
Limitations on environmental reporting
In certain cases, information cannot be provided on the bases
of actual consumption, e.g., for the sites with service charges
related to water consumption and recharging the refrigerant to
use the air-conditioning system which are included in the rent.
For some foreign subsidiaries representing a small contribution
in the ratio, the data related to travel is not available on the
basis of the same format as the rest of the scope. In these
cases, the Environmental Reporting Protocol specifies the
procedure to follow in order to make the estimations required
(e.g., an estimation of water consumption is made on the basis
of the averages recorded on the other sites in the geographic
region based on the number of employees or square meters
taken up). As a result, actual consumption may be different
from estimates.
Regarding waste treatment, waste treatment and collection are
handled for most subsidiaries by local government, which does
not furnish any information on collected waste. It is therefore
not possible to provide any information on the amount of
waste generated. Dassault Systèmes has nevertheless inquired
of all subsidiaries included in the 2015 reporting scope as to
whether recycling was put in place. Consequently, the Group
produces information on the percentage of sites adopting
waste recycling rather than on the quantity of waste treated
(see paragraph 2.2.2 “Responsible Company”).
2
2.2.6
Industrial and Environmental Risk
The Group is not aware of any industrial or environmental risks
which may have a significant impact on its financial condition
or operating results, and it believes that its business has a very
limited environmental impact:
impact on its financial condition or results of operations, is
the fuel storage at the 3DS Paris Campus and the 3DS Boston
Campus, which would be used to produce electricity in case of
an electrical shortage.
(cid:125) a significant portion of its assets are intangible;
(cid:125) none of the Company’s sites produces dangerous waste or
waste with an environmental impact on the ground, air or
water, and none of them meets criteria set forth under the
European SEVESO directive regarding sites at risk due to
hazardous substances, or is classified under ICPE (Classified
Installation for the Protection of the Environment );
(cid:125) the Company does not believe that it is directly exposed to
climate change issues in the short or medium-term;
(cid:125) Dassault Systèmes’ business does not have any known
negative impact on biodiversity, nor does it create noise or
odors that may create a nuisance locally. In addition, the
Company is not involved with soil usage matters.
The only aspect for which the Group believes there exists a
minor environmental risk, which would not have a significant
Based on the Company’s limited industrial and environmental
risks, costs resulting from evaluating, preventing and treating
industrial and environmental risks are not significant and are
included under different line items representing investments
and expenses in the consolidated financial statements.
In 2015, no provisions or guarantees for environmental
risks were recorded in the Group’s consolidated financial
statements. In addition, no expense was recognized in the
financial statements related to a court judgment regarding
environmental issues or actions taken to remediate any
environmental-damage.
To anticipate any regulatory risks related to environmental
matters, Dassault Systèmes’ Legal department and General
Resources and Sustainable Development department closely
follow environmental regulations that may have an effect on
its business.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
67
2 Social, Societal and Environmental Responsibility
Independent Verifi er’s Attestation and Assurance Report on Social, Societal and Environmental Information
2.3
Independent Verifi er’s Attestation
and Assurance Report on Social, Societal
and Environmental Information
This is a free translation into English of the original report issued in the French language and it is provided solely for the
convenience of English speaking users. This report should be read in conjunction with, and construed in accordance with, French
law and professional standards applicable in France.
To the Shareholders,
In our quality as an independent verifier accredited by the COFRAC(1) under the number n° 3-1050, and as a member of the
network of one of the Statutory Auditors of the company Dassault Systèmes, we present our report on the consolidated social,
environmental and societal information established for the year ended on December 31, 2015, presented in chapter 2 of the
management report, hereafter referred to as the “CSR Information,” pursuant to the provisions of the article L. 225-102-1 of the
French Commercial Code (Code de commerce).
Responsibility of the Company
It is the responsibility of the Board of Directors to establish a management report including CSR Information referred to in the
article R. 225-105-1 of the French Commercial Code (Code de commerce), in accordance with the protocols used by the Company,
consisting in HR reporting instructions and an environmental reporting protocol in their versions both dated November 2015
(hereafter referred to as the “Criteria”), and of which a summary is included in section 2.1.6 (social reporting) and in section 2.2.5
(environmental reporting) of the management report, as well as available at the Company’s headquarters.
Independence and quality control
Our independence is defined by regulatory requirements, the Code of Ethics of our profession as well as the provisions in the
article L. 822-11 of the French Commercial Code (Code de commerce). In addition, we have implemented a quality control system,
including documented policies and procedures to ensure compliance with ethical standards, professional standards and applicable
laws and regulations.
Responsibility of the independent verifi er
It is our role, based on our work:
(cid:125) to attest whether the required CSR Information is present in the management report or, in the case of its omission, that an
appropriate explanation has been provided, in accordance with the third paragraph of R. 225-105 of the French Commercial
Code (Code de commerce) (Attestation of presence of CSR Information);
(cid:125) to express a limited assurance conclusion, that the CSR Information, overall, is fairly presented, in all material aspects, in
according with the Criteria (Limited assurance on CSR Information).
Our verification work was undertaken by a team of five people between October 2015 and March 2016 for an estimated duration
of seven weeks.
We conducted the work described below in accordance with the professional standards applicable in France and the Order of
May 13,2013 determining the conditions under which an independent third-party verifier conducts its mission, and in relation to
the opinion of fairness and the reasonable assurance report, in accordance with the international standard ISAE 3000(2).
(1) Scope available at www.cofrac.fr
(2) ISAE 3000 – Assurance engagements other than audits or reviews of historical information.
68 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
2
2
Social, Societal and Environmental Responsibility
Independent Verifi er’s Attestation and Assurance Report on Social, Societal and Environmental Information
1.
Attestation of presence of CSR Information
We obtained an understanding of the Company’s CSR issues, based on interviews with the management of relevant departments,
a presentation of the Company’s strategy on sustainable development based on the social and environmental consequences linked
to the activities of the Company and its societal commitments, as well as, where appropriate, resulting actions or programmes.
We have compared the information presented in the management report with the list as provided for in the article R. 225-105-1
of the French Commercial Code (Code de commerce).
In the absence of certain consolidated information, we have verified that the explanations were provided in accordance with the
provisions in article R. 225-105-1, paragraph 3, of the French Commercial Code (Code de commerce).
We verified that the information covers the consolidated perimeter, namely the entity and its subsidiaries, as aligned with the
meaning of the article L. 233-1 and the entities which it controls, as aligned with the meaning of the article L. 233-3 of the
French Commercial Code (Code de commerce) with the limitations specified in the Methodological Note in sections 2.1.6 and
2.2.5 of chapter 2 of the management report.
Based on this work, and given the limitations mentioned above, we confirm the presence in the management report of the
required CSR information.
2.
Limited assurance on CSR Information
Nature and scope of the work
We undertook a dozen interviews with the people responsible for the preparation of the CSR Information in the different
departments, including people in the Human Resources, Facilities, Purchasing, Innovation, who are in charge of the data collection
process and, if applicable, the people responsible for internal control processes and risk management, in order to:
(cid:125) assess the suitability of the Criteria for reporting, in relation to their relevance, completeness, reliability, neutrality, and
understandability, taking into consideration, if relevant, industry standards;
(cid:125) verify the implementation of the process for the collection, compilation, processing and control for completeness and consistency
of the CSR Information and identify the procedures for internal control and risk management related to the preparation of the
CSR Information.
We determined the nature and extent of our tests and inspections based on the nature and importance of the CSR Information,
in relation to the characteristics of the Company, its social and environmental issues, its strategy in relation to sustainable
development and industry best practices.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
69
2 Social, Societal and Environmental Responsibility
Independent Verifi er’s Attestation and Assurance Report on Social, Societal and Environmental Information
For the CSR Information which we considered the most important(1):
(cid:125) at the level of the consolidated entity, we consulted documentary sources and conducted interviews to corroborate the qualitative
information (organisation, policies, actions, etc.), we implemented analytical procedures on the quantitative information
and verified, on a test basis, the calculations and the compilation of the information, and also verified their coherence and
consistency with the other information presented in the management report;
(cid:125) at the level of the representative sample of entities that we selected(2) based on their activity, their contribution to the
consolidated indicators, their location and a risk analysis, we undertook interviews to verify the correct application of the
procedures and undertook detailed tests on the basis of samples, consisting in verifying the calculations made and linking them
with supporting documentation. The sample reviewed therefore represented on average 31 % of the workforce and between
10% and 46% for quantitative environmental information(3).
For the other consolidated CSR information, we assessed their consistency in relation to our knowledge of the Company.
Finally, we assessed the relevance of the explanations provided, if appropriate, in the partial or total absence of certain information.
We consider that the sample methods and sizes of the samples that we considered by exercising our professional judgment allow
us to express a limited assurance conclusion; an assurance of a higher level would have required more extensive verification work.
Due to the necessary use of sampling techniques and other limitations inherent in the functioning of any information and internal
control system, the risk of non-detection of a significant anomaly in the CSR Information cannot be entirely eliminated.
Conclusion
Based on our work, we have not identified any significant misstatement that causes us to believe that the CSR Information, taken
together, has not been fairly presented, in compliance with the Criteria.
Paris-La Défense, on March 18, 2016
French original signed by:
Independent Verifier
ERNST & YOUNG et Associés
Eric Mugnier
Partner, sustainable development
Bruno Perrin
Partner
(1) Environmental and societal information:
Indicators (quantitative information): energy consumption (in MWh), greenhouse gas emissions (in tonnes of CO2 equivalent), quantity of waste
electrical and electronic equipment recycled according to environmental norms (in kg).
Qualitative information: general environmental policy (organisation, evaluation or certification procedures), measures for preventing, recycling and
eliminating waste, sustainable use of resources and climate change (energy consumption, measures taken to improve energy efficiency and the use of
renewable energy), importance of sub-contracting and the consideration of environmental and social issues in purchasing policies and relations with
suppliers and subcontractors, business ethics (actions undertaken to prevent bribery and corruption), territorial, economic and social impact (impact on
neighbouring or local populations).
Social information:
Indicators (quantitative information): workforce size and breakdown by geography, age, gender, type of contract (long/short term), percentage of
female managers, absenteeism, hiring and terminations, turnover rate, total number of training hours and breakdown by type of training, by category,
by gender, and the ratio of hours of training per employee.
Qualitative information: employment (total headcount and breakdown, hiring and terminations, remunerations and their evolution), the organisation of
working time, absenteeism, social relationships (the organisation of social dialogue, collective bargaining agreements), health and safety conditions at
work, training policies, diversity and equality of treatment and opportunities (measures undertaken for gender equality, the employment and inclusion
of people with disabilities, anti-discrimination policies and actions).
(2) The entities Dassault Systèmes S.E. and Dassault Data Service (DS Paris Campus and Terre Europa sites in Vélizy, France); the entities Dassault Systèmes
Canada Inc. and DS Canada Software Inc. (Montreal, Canadian site).
(3) The coverage rate of our work is 31 % of the workforce for the social data, 46% for the quantities of computers and servers recycled, 42% for energy
consumption, and 18% for greenhouse gas emissions.
70 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
3
FINANCIAL REVIEW
AND PROSPECTS
CONTENTS
3.1 Operating and Financial Review
3.1.1 General
72
72
3.2 2016 Financial Objectives
and Multi-Year Growth Plan
3.1.2 Consolidated Information: 2015 Compared to 2014 78
3.1.3 Trends in Quarterly Results
3.1.4 Capital Resources
82
83
3.3 Interim and Other Financial
Information
83
84
DASSAULT SYSTÈMES ANNUAL REPORT 2015
71
3 Financial Review and prospects
Operating and Financial Review
3.1 Operating and Financial Review
3.1.1 General
The executive overview in paragraph 3.1.1.1 “Executive
Overview for 2015” highlights selected aspects of the
Company’s financial results for 2015. The executive overview,
the supplemental non-IFRS financial information and the
more detailed discussion that follows should be read together
with the Company’s consolidated financial statements and
the related notes included in paragraph 4.1.1 “Consolidated
Financial Statements”.
In discussing and analyzing the Company’s results of
operations, the Company considers supplemental non-IFRS
financial information: (i) non-IFRS revenue data excludes the
effect of adjusting the carrying value of acquired companies’
deferred revenue; and non-IFRS expense data excludes,
(ii) the amortization of acquired intangibles, (iii) share-based
compensation expense and related social charges, (iv) certain
other operating income and expense, net, (v) certain one-
time items included in financial income and other, net, and
(vi) certain one-time tax effects and the income tax effects of
the above adjustments. A reconciliation of this supplemental
non-IFRS financial information with information set forth
in the Company’s consolidated financial statements and the
notes thereto is presented below under paragraph 3.1.1.2
“Supplemental non-IFRS Financial Information”.
When the Company believes it would be helpful for
understanding trends in its business, it restates percentage
increases or decreases in selected financial data to eliminate the
effect of changes in currency values, particularly the U.S. dollar
and the Japanese yen, relative to the euro. Specifically, the
Company’s constant currency revenue data calculations take
into account the estimated impact of changes in the currency
exchange rates compared to the euro. When trend information
is expressed below “in constant currencies”, the results of
the prior year have first been recalculated using the average
exchange rates of the most recent year, and then compared
with the results of the most recent year. All constant currency
information is provided on an approximate basis. Unless
otherwise indicated, the impact of exchange rate fluctuations
is approximately the same for both the Company’s IFRS and
supplemental non-IFRS financial data.
3.1.1.1
Executive Overview for 2015
(all revenue growth comparisons
are in constant currencies)
Summary Overview
2015 represented the first year of Dassault Systèmes five-
year growth plan to double non-IFRS earnings per share. This
goal is based upon an expansion of the Company’s addressable
market powered by internal and external investments and
reflects the opportunities the Company envisions reflecting
its expanded purpose, 3DEXPERIENCE addressable market
opportunity and the 3DEXPERIENCE
industry solutions
strategy.
the Company set a good
During 2015
foundation,
performing well from multiple aspects and achieving all of
its key objectives. The expansion of its addressable market is
translating into a more dynamic set of growth drivers which
animated its financial performance.
(cid:125) The Company’s revenue growth in 2015 reflected strong
overall growth in its core industries and in terms of
progression of its diversification industries. During 2015
Core Industries software revenue increased approximately
9% in total in constant currencies, with strong growth
in Transportation & Mobility, Industrial Equipment and
Aerospace & Defense. Core Industries represented 70% of
total software revenue in 2015. Diversification Industries
represented 30% of total software revenue up two
percentage points from 2014 with the contribution mix
well aligned with the Company’s mid-term target of 30%.
In addition to expanding in Life Sciences with BIOVIA,
industries with strong growth in 2015 included Energy,
Process & Utilities, Consumer Packaged Goods & Retail, and
Natural Resources;
(cid:125) 3DEXPERIENCE was an important driver with clients around
the globe. In terms of acceleration, 3DEXPERIENCE sales
represented 29% of related new licenses revenue for 2015,
up 5 percentage points from 2014;
72 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Review and prospects
Operating and Financial Review
3
3
(cid:125) The Company benefited from its geographic reach which
continues to expand thanks to its global/local orientation. In
total, software revenue growth in constant currencies was
well balanced across the Company’s three reporting regions,
Europe, Americas and Asia. Moreover, within regions the
number of geos driving growth and becoming meaningful
absolute contributors to the Company’s revenue base is
expanding;
(cid:125) From a channel performance perspective, software revenue
growth during 2015 was led by the Company’s direct
sales channel with new licenses revenue growth of 19%
in constant currencies, well supported by its two indirect
sales channels. Complementing new business activity with
current customers, Dassault Systèmes added 22,000 new
clients in 2015, thanks to its sales channels in particular
its Professional Channel reaching the volume market. In
total, the Company continues to benefit from a balanced
distribution mix of direct and indirect sales, with direct
sales representing 59% of total revenue and indirect sales
accounting for 41% of total revenue in 2015;
(cid:125) At the outset of 2015 the Company outlined two key
financial goals: to deliver organic double-digits non-IFRS
new licenses revenue growth and to generate an increase in
its organic non-IFRS operating margin of approximately 100
basis points – both targets excluding any currency benefits.
These goals were well reflected in Dassault Systèmes’
performance during 2015:
(cid:125) the Company achieved organic double-digits non-IFRS
new licenses revenue growth in constant currencies,
increasing 11% for 2015. This was on top of an organic
growth of 10% during 2014,
(cid:125) the Company continues to focus on improving its operating
efficiency and this is demonstrated by the organic non-
IFRS operating margin progression which increased 120
basis points in 2015, exclusive of any currency benefits;
(cid:125) Dassault Systèmes benefits from a high level of recurring
software revenue, at the core of its financial model.
Recurring software revenue represented 70% of non-IFRS
total software revenue in 2015, and grew 10% in constant
currencies, of which 7% was organic;
(cid:125) And thanks to revenue growth, favourable currency, and
operating margin expansion, non-IFRS earnings per share
grew 24% in 2015;
(cid:125) The Company had a very good evolution of operating cash
flow in 2015, increasing 27% to €633.3 million for the
full year. And from a balance sheet perspective, unearned
revenue increased 13% excluding currency impacts at
December 31, 2015 compared to December 31, 2014;
(cid:125) Finally, from a strategic perspective, the Company believes
that its purpose, strategy and investments are well aligned
with the issues at the heart of its clients’ businesses,
with its financial performance demonstrating that its
investments in research and development, complemented
by the appropriate acquisitions, well serve the industries and
clients the Company addresses, as well as its shareholders.
Summary Financial Highlights (all revenue growth
comparisons are in constant currencies)
Total Revenue: For the year ended December 31, 2015, IFRS
total revenue increased 13%. Software revenue represented
88% of total revenue and increased 13% with services and
other revenue growing 20%. Non-IFRS total revenue increased
12% with software revenue growth of 12% and services and
other revenue growth of 17%. Financial results for 2015
and 2014 include the acquisitions of Accelrys (acquired late
April 2014) and Quintiq (acquired September 2014).
Revenue by Region: The Company continues to expand its
presence with clients in its three principal regions, strengthening
and expanding its sales channels and local presence. For 2015,
Europe represented 44% of total revenues, the Americas 31%
and Asia 25%. By region, software revenue growth was well
balanced across the Company’s three regions. Growth in Asia
was led by most notably Japan, South Korea and India. In the
Americas growth was driven by North America, with weaker
results for Latin America. In Europe, growth was led by the
United Kingdom, France and Southern Europe.
Software Revenue by Type: Non-IFRS software revenue
increased 12% in total for 2015. New licenses revenue rose
15% on double-digit organic new licenses revenue growth.
Non-IFRS periodic license, maintenance and other software-
related revenue increased 10% on growth of maintenance
revenue and rental revenue. Excluding acquisitions, non-
IFRS software revenue increased 8% in 2015, with non-IFRS
new licenses software revenue growth of 11% and periodic,
maintenance and other software revenue growth of 7%.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
73
3 Financial Review and prospects
Operating and Financial Review
Software Revenue by Product Line: By product line, non-
IFRS software revenue increased 5% for CATIA, 12% for
SOLIDWORKS, 5% for ENOVIA, and Other Software, which
included the 2014 acquisitions of Quintiq and BIOVIA
(Accelrys), increased 26%. On an organic basis, Other Software
increased 11% led by SIMULIA, DELMIA and EXALEAD.
Recurring Software Revenue: Since inception in 1981 the
Company has had a long-term focus on maintaining a highly
recurrent software revenue model. Non IFRS recurring
software revenue represented 70% and 71% of total software
revenue for 2015 and 2014, respectively. Recurring software
revenue is comprised of maintenance and rental subscriptions.
IFRS operating
Income and Margin:
Operating
income
increased 47% and non-IFRS operating income increased
27% to €884.9 million for 2015 on revenue growth,
favorable currency evolution and organic operating margin
improvement. The non-IFRS operating margin increased to
30.8%, compared to 29.8% in 2014. On an organic basis, the
non-IFRS operating margin increased an estimated 120 basis
points for 2015 offsetting acquisition dilution of a similar
level.
Earnings per Share: The Company’s earnings per share
were sharply higher in 2015 driven principally by growth in
revenue, a strong benefit from favorable currency effects and
operating margin growth. IFRS diluted net income per share
increased 38% and non-IFRS net income per share increased
24% to €2.25 per diluted share, compared to €1.82 per
diluted share for 2014. On a non-IFRS basis, currency had a
net favorable impact of approximately 13 percentage points.
Average diluted shares outstanding were 256.6 million and
255.3 million for 2015 and 2014, respectively.
results
financial
Acquisitions: The 2015
the
incorporation of several acquisitions, the most significant
of which were Accelrys in April 2014 and Quintiq in
September 2014. Based upon the size of these companies
they had an important impact on the revenue growth of the
Company in 2015.
reflect
Currency: During 2015 currency exchange rate evolution had
a material, net positive impact on the Company’s reported
revenue growth rates and was an important contributor to
operating income and earnings per share growth. In 2014
currency had a net negative impact on reported growth rates,
operating income and earnings per share growth.
2016 Business Outlook: For a discussion of the Company’s
2016 business outlook, see paragraph 3.2 “2016 Financial
Objectives and Multi-Year Growth Plan”. For
further
information regarding risks facing the Company, see
paragraph 1.6.1 “Risks Related to the Company’s Business”.
74 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Cash Flow: Net operating cash flow was €633.3 million for the
year ended December 31, 2015, compared to €499.5 million
in 2014. In 2015 and 2014 changes in working capital
included the net payment of €57.7 million and €22.2 million,
respectively, in connection with ongoing tax proceedings.
During 2015, the Company uses of cash were principally
for cash dividends of €98.4 million, capital expenditures of
€43.6 million, share repurchases of €28.3 million and payment
for acquisitions of €20.2 million, net of cash acquired. The
Company received cash of €650 million in conjunction with
a new credit facility entered into in October 2015 and fully
drawn down at the time and for stock options exercised of
€35.9 million.
Other Financial Highlights: At December 31, 2015, cash, cash
equivalents and short-term investments totaled €2.35 billion
and long-term debt was €1.0 billion compared to €1.18 billion
and €350.0 million, respectively at December 31, 2014.
3.1.1.2
Supplemental Non-IFRS Financial
Information
Readers are cautioned that the supplemental non-IFRS
financial information is subject to inherent limitations. It is
not based on any comprehensive set of accounting rules or
principles and should not be considered in isolation from or
as a substitute for IFRS measurements. The supplemental
non-IFRS financial information should be read only in
conjunction with the Company’s consolidated financial
statements prepared in accordance with IFRS. Furthermore,
the Company’s supplemental non-IFRS financial information
may not be comparable to similarly titled non-IFRS measures
used by other companies. Specific limitations for individual
non-IFRS measures are set forth below.
In evaluating and communicating its results of operations,
the Company supplements its financial results reported on an
IFRS basis with non-IFRS financial data. As further explained
below, the supplemental non-IFRS financial information
excludes the effects of: deferred revenue adjustments for
acquired companies, amortization of acquired intangibles,
share-based compensation expense and related social charges,
other operating income and expense, net, certain one- time
items included in financial revenue and other, net, and the
income tax effect of the non-IFRS adjustments and certain
one-time tax effects. Subject to the limitations set forth above
and below, the Company believes that the supplemental non-
IFRS financial information provides a consistent basis for
period-to-period comparisons which can improve investors’
understanding of its financial performance.
Financial Review and prospects
Operating and Financial Review
3
3
The Company’s management uses the supplemental non-
IFRS financial information, together with its IFRS financial
information, for financial planning and analysis, evaluation of
its operating performance, mergers and acquisition analysis
and valuation, operational decision-making and for setting
financial objectives for future periods. Compensation of its
senior management is based in part on the performance
of its business measured with the supplemental non-IFRS
information. The Company believes that the supplemental
non-IFRS data also provides meaningful information to
investors and financial analysts who use the information
for comparing the Company’s operating performance to its
historical trends and to other companies in its industry, as well
as for valuation purposes.
The supplemental non-IFRS financial information adjusts the
Company’s IFRS financial information to exclude:
(cid:125) deferred revenue adjustment of acquired companies: under
IFRS, deferred revenue of an acquired company must be
adjusted by writing it down to account for the fair value
of obligations assumed under contracts acquired through
the acquisition of the company. As a result, in the case of
a typical one-year contract, the Company’s IFRS revenues
for the one-year period subsequent to an acquisition do not
reflect the full amount of revenue on assumed contracts
that would have otherwise been recorded by the acquired
entity in the absence of the acquisition.
In its supplemental non-IFRS financial information, the
Company has excluded this write-down to the carrying value
of the deferred revenue, and reflects instead the full amount
of such revenue. The Company believes that this non-IFRS
measure of revenue is useful to investors and management
because it reflects a level of revenue and operational results
which corresponds to the combined business activities of
Dassault Systèmes and the acquired company. In addition, the
non-IFRS financial information provides a consistent basis for
comparing its future operating performance, when no further
adjustments to deferred revenue are required, against recent
results.
However, by excluding the deferred revenue adjustment, the
supplemental non-IFRS financial information reflects the total
revenue that would have been recorded by the acquired entity
but may not reflect the total cost associated with generating
the non-IFRS revenue.
(cid:125) amortization of acquired intangibles, including amortization
of acquired technology: under IFRS, the cost of acquired
intangible assets, whether acquired through acquisitions
of companies or of technology or certain other intangible
assets, must be recognized according to the assets’ fair
value and amortized over their useful life.
In its supplemental non-IFRS financial information, the
Company has excluded the amortization expenses related
to acquired intangibles in order to provide a consistent basis
for comparing its historical results. For technology and other
intangible assets the Company develops internally, it typically
expenses costs in the period in which they are incurred. For
example, because it typically incurs most of its R&D costs prior
to reaching technical feasibility, its R&D costs are expensed
in the period in which they are incurred. By excluding the
amortization expenses related to acquired intangibles, the
supplemental non-IFRS financial
information provides a
uniform approach for evaluating the development cost of all
the Company’s technology, whether developed internally or
acquired externally. As a result, the Company believes that the
supplemental financial information offers investors a useful
basis for comparing its historical results.
However, the acquired intangible assets whose amortization
costs are excluded contributed to revenue earned during the
period, and it may not have been possible to earn such revenue
without such assets. In addition, the amortization of acquired
intangibles is a recurring expense until their total cost has
been amortized;
(cid:125) share-based compensation expense and related social
charges: under IFRS, the Company is required to recognize
in its income statement all share-based payments to
employees, including grants of employee stock options
and performance shares, based on their fair values over the
period that an employee provides service in exchange for
the award.
The Company excludes this expense in its supplemental
non-IFRS financial information as financial analysts and
investors use a valuation model which may not take into
account its share-based compensation expense. The exclusion
of share-based compensation expense in the Company’s
supplemental non-IFRS financial information therefore helps
them ensure the consistency of their valuation metrics. The
Company’s management considers the supplemental non-
IFRS information which excludes share-based compensation
the Company’s operating
expense when
performance, since share-based compensation expenses can
fluctuate due to factors other than the level of its business
activity or operating performance.
reviewing
However, share-based compensation
is one component
of employee compensation. By excluding share-based
compensation expense, the supplemental non-IFRS financial
information does not reflect the Company’s full cost of
attracting, motivating and retaining its personnel. Share-
based compensation expense is a recurring expense;
DASSAULT SYSTÈMES ANNUAL REPORT 2015
75
3 Financial Review and prospects
Operating and Financial Review
(cid:125) other operating income and expense, net: under IFRS, the
Company has recognized certain other operating income
and expense comprised of the impact of restructuring
activities, gains or losses on sale of subsidiaries, costs
directly related to acquisitions and costs related to site
closings and relocations.
In its supplemental non-IFRS financial information, the
Company excludes other operating income and expense
effects because of their unusual, infrequent or generally
non-recurring nature. As a result, the Company believes
that its supplemental non-IFRS financial information helps
investors better understand the current trends in its operating
performance.
However, other operating income and expense are components
of the Company’s income and expense and by excluding them
the supplemental non-IFRS financial information excludes
their impact to its net income;
(cid:125) certain one-time items included in financial revenue and
other, net: under IFRS, the Company has recognized certain
one-time items in financial revenue and other, net comprised
of gains and losses on disposals of non-consolidated equity
investments and the expense recognized following the
impairment of non-consolidated equity investments.
In its supplemental non-IFRS financial information, the
Company excludes certain one-time items included in financial
revenue and other, net because of their unusual, infrequent
or generally non-recurring nature. As a result, the Company
believes that its supplemental non-IFRS financial information
helps investors better understand the current trends in its
operating performance.
However, these one-time items included in financial revenue
and other, net are components of the Company’s income and
expense and by excluding them the supplemental non-IFRS
financial information excludes their impact to its net income;
(cid:125) certain one-time tax effects: the Company restructured
certain activities which resulted in immediate adjustment
of the income tax provision. The Company’s IFRS financial
statements reflect the impact of these one-time tax effects.
In its supplemental non-IFRS financial information, the
Company has excluded these one-time tax effects because
of their unusual nature in qualitative terms. The Company
does not expect such tax effects to occur as part of its
normal business on a regular basis. As a result, the Company
believes that by excluding these one-time tax impacts, its
supplemental non-IFRS financial information helps investors
understand the current trends in its operating performance.
The Company also believes that the exclusion of certain one-
time tax effects facilitates a comparison of its effective tax rate
between different periods.
However, these one-time tax effects are a component of the
Company’s income tax expense. By excluding these effects,
the supplemental non-IFRS financial information understates
or overstates the Company’s income tax expense. These one-
time tax effects are not a recurring expense.
76 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Review and prospects
Operating and Financial Review
3
3
The following table sets forth the Company’s supplemental non-IFRS financial information, together with the comparable IFRS
financial measure and a reconciliation of the IFRS and non-IFRS information.
(in millions,
except percentages and per share data)
Total Revenue
Total revenue by activity
Software revenue
Services and other revenue
Total revenue by geography
Americas
Europe
Asia
Total software revenue by product line
CATIA software revenue
ENOVIA software revenue
SOLIDWORKS software revenue
Other software revenue
Total Operating Expenses
Share-based compensation expense
Amortization of acquired intangibles
Other operating income and expense,
net
Operating Income
Operating Margin
Financial revenue and other, net
Income before Income Taxes
Income tax expense
(of which certain one-time tax
restructuring effects)
Non-controlling interest
Net Income attributable to
shareholders
Diluted Net Income per Share(3)
Year ended December 31,
% Change
2015 IFRS
€2,839.5
Adjust-
ment (1)
2015
non-IFRS
2014 IFRS
Adjust-
ment (1)
2014
non-IFRS
IFRS non-IFRS (2)
€37.2
€2,876.7
€2,294.3
€52.4
€2,346.7
24%
23%
2,502.8
336.7
889.5
1,226.5
723.5
938.5
301.9
569.8
692.6
35.1
2.1
20.0
11.6
5.6
0.4
–
–
34.7
2,537.9
2,035.0
338.8
259.3
909.5
659.1
1,238.1
1,052.8
729.1
582.4
938.9
301.9
569.8
727.3
838.6
262.8
447.7
485.9
43.6
8.8
18.3
22.7
11.4
–
–
–
43.6
2,078.6
268.1
677.4
1,075.5
593.8
838.6
262.8
447.7
529.5
2,206.3
(214.5)
1,991.8
1,863.5
(216.0)
1,647.5
(42.5)
(159.6)
(12.4)
633.2
22.3%
(0.1)
633.1
(227.1)
42.5
159.6
12.4
251.7
–
251.7
(77.3)
–
–
(43.3)
(133.4)
–
884.9
30.8%
(0.1)
884.8
(39.3)
430.8
18.8%
15.0
445.8
(304.4)
(153.3)
(6.7)
(3.8)
6.7
–
–
(3.8)
2.1
(1.2)
43.3
133.4
39.3
268.4
(1.8)
266.6
(91.9)
(2.1)
(0.5)
–
–
–
699.2
29.8%
13.2
712.4
(245.2)
–
(1.7)
23%
30%
35%
16%
24%
12%
15%
27%
43%
18%
22%
26%
34%
15%
23%
12%
37%
21%
47%
27%
42%
48%
24%
24%
€402.2
€1.57
€174.4
€0.68
€576.6
€2.25
€291.3
€1.14
€174.2
€0.68
€465.5
€1.82
38%
38%
24%
24%
(1) In the reconciliation schedule above, (i) all adjustments to IFRS revenue data reflect the exclusion of the deferred revenue adjustment of acquired companies, (ii) adjustments to
IFRS operating expense data reflect the exclusion of the amortization of acquired intangibles, share-based compensation expense and related social charges, as detailed below, and
other operating income and expense, net (iii) adjustments to IFRS financial revenue and other, net reflect the exclusion of certain one-time items included in financial revenue and
other, net, and (iv) all adjustments to IFRS income data reflect the combined effect of these adjustments, plus with respect to net income and diluted net income per share, the
income tax effect of the non-IFRS adjustments and certain one-time tax effects.
(in millions)
Cost of revenue
Research and development
Marketing and sales
General and administrative
Total share-based compensation
expense
Year ended December 31,
2015
IFRS Adjustment
2015
non-IFRS
2014
IFRS Adjustment
€437.9
492.5
892.2
211.7
€(1.3)
(17.7)
(15.4)
(8.1)
(42.5)
€436.6
€343.2
474.8
876.8
203.6
409.7
748.5
189.4
€(1.1)
(16.9)
(13.9)
(11.4)
(43.3)
2014
non-IFRS
€342.1
392.8
734.6
178.0
(2) The non-IFRS percentage change compares non-IFRS measures for the two different periods. In the event there is an adjustment to the relevant measure for only one of the periods
under comparison, the non-IFRS change compares the non-IFRS measure to the relevant IFRS measure.
(3) Based on a weighted average of 256.6 million diluted shares for 2015 and 255.3 million diluted shares for 2014.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
77
3 Financial Review and prospects
Operating and Financial Review
3.1.1.3
Critical Accounting Principles
The Company’s consolidated financial statements have been
prepared in accordance with IFRS. The preparation of these
financial statements requires the Company to make certain
assumptions and estimates. Actual results may differ from
these estimates under different assumptions or conditions. The
Company believes the following critical accounting policies,
among others, involve the more significant assumptions and
estimates used in the preparation of its consolidated financial
statements: revenue recognition, share-based payments,
purchase price allocation for business combinations, goodwill
and other intangible assets, income taxes and reasonable
estimates about the ultimate resolution of the Company’s
tax uncertainties. See Note 2 to the consolidated financial
statements for a description of these accounting policies.
3.1.2 Consolidated Information: 2015 Compared to 2014
Revenue
The Company’s total revenue is comprised of (i) software revenue, which is its primary source of revenue, representing 88% of
total revenue in 2015, and (ii) services and other revenue, which represented 12% of total revenue in 2015.
(in millions, except percentages)
Total Revenue
Total revenue by activity
Software revenue
Services and other revenue
Total revenue by geographic region*
Americas
Europe
Asia
Year ended
December 31,
2015
€2,839.5
2,502.8
336.7
889.5
1,226.5
723.5
% change
24%
23%
30%
35%
16%
24%
% change
in constant
currencies
Year ended
December 31,
2014
13%
€2,294.3
13%
20%
14%
13%
14%
2,035.0
259.3
659.1
1,052.8
582.4
*
The Company’s largest national markets as measured by total revenue are the United States, Germany, Japan, France and the United Kingdom. See Note 3 to the consolidated
financial statements.
IFRS total revenue increased 13% in constant currencies.
Non-IFRS total revenue increased 12%, on software revenue
growth of 12% and services and other revenue growth of 17%
in constant currencies. Excluding acquisitions and in constant
currencies, non-IFRS software revenue increased 8% in 2015,
with new licenses revenue growth of 11% and with recurring
(periodic and maintenance subscriptions) and other software
revenue growth of 7%.
Software revenue growth was well balanced across the
Company’s three regions. Growth in Asia was led by most
notably Japan, South Korea and India. In the Americas growth
was driven by North America, with weaker results for Latin
America. In Europe, growth was led by the United Kingdom,
France and Southern Europe.
Software Revenue
Software revenue is primarily comprised of new licenses
revenue and periodic
licenses, maintenance and other
software-related revenue. Periodic licenses subscription and
maintenance subscription revenue are referred to together as
“recurring revenue”.
The Company’s products are principally licensed pursuant to
one of two payment structures: (i) new licenses, for which the
customer pays an initial or one-time fee for a perpetual license
or (ii) periodic (rental subscription or cloud subscription)
licenses, for which the customer pays periodic fees to keep
the license active. Access to maintenance and unspecified
product updates or upgrades requires payment of a fee,
which is recorded as maintenance revenue. Periodic (rental
78 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Review and prospects
Operating and Financial Review
3
or subscription) licenses entitle the customer to corrective
maintenance and product updates without additional charge.
Product updates include improvements to existing products
but do not cover new products. Other software-related revenue
is comprised of the Company’s product development revenue
relating to the development of additional functionalities of
standard products requested by customers.
Non-IFRS recurring software revenue represented 70%
and 71% of total software revenue for 2015 and 2014,
respectively.
Other software revenue totaled €20.4 million for 2015
compared to €11.3 million for 2014 and was comprised of
revenue related to the development of additional functionalities
of standard products requested by clients.
(in millions, except percentages)
2015
2014
Year ended December 31,
Software revenue
New licenses revenue
Periodic licenses, maintenance
and other software-related
revenue
Total software revenue
(as % of total revenue)
€716.5
€579.4
1,786.3
€2,502.8
88.1%
1,455.6
€2,035.0
88.7%
For 2015, IFRS software revenue increased 23.0% and
increased 13% in constant currencies. Similarly, non-IFRS
software revenue increased 22.1% and 12% excluding currency
effects and totaled €2.54 billion compared to €2.08 billion for
2014. Excluding acquisitions and currency impacts non-IFRS
software revenue increased 8% in 2015.
IFRS new licenses revenue increased 23.7% and 12% in
constant currencies in 2015. Non-IFRS new licenses revenue
of €735.6 million increased 26.5% and 15% in constant
currencies, benefiting from organic growth estimated at 11%
in constant currencies and 2014 acquisitions. New licenses
revenue represented 28.6% and 28.5% of total software
revenue for 2015 and 2014, respectively.
IFRS recurring software revenue, comprised of periodic
licenses and maintenance subscriptions, increased 22.3%
and 12% in constant currencies and totaled €1,765.9 million
for 2015, compared to €1,444.3 million for 2014. Non-IFRS
recurring software revenue increased 19.9% and 10% in
constant currencies and totaled €1,781.9 million for 2015
compared to €1,485.8 million in 2014. Excluding currency
effects, recurring software revenue growth reflected strong
results across the Company’s three regions, and continued to
reflect high maintenance attachment rates and renewal rates.
Rental revenue increased in total while reflecting mixed results
on an organic basis.
Services and Other Revenue
Services and other revenue have historically been comprised of
revenue from consulting services in methodology for design,
deployment and support, training services and engineering
services. With the Company’s new brand, 3DEXCITE (renaming
of RTT following its acquisition in 2014), services and other
revenue also include content-related digital production for use
in 3D visualization, advertising, sales and marketing.
3
(in millions, except percentages)
Services and other revenue
(as % of total revenue)
Year ended December 31,
2015
€336.7
11.9%
2014
€259.3
11.3%
Services and other revenue growth was 29.8% and excluding
currency impacts increased about 20%, reflecting the full year
impact of the 2014 acquisitions. On an organic basis, Services
and other revenue grew 1% consistent with the Company’s
focus on increasing engagements with system integrators.
Operating expenses
(in millions)
Operating expenses
Adjustments*
Non-IFRS operating expenses*
Year ended December 31,
2015
€2,206.3
(214.5)
€1,991.8
2014
€1,863.5
(216.0)
€1,647.5
*
The adjustments and non-IFRS operating expenses in the table above reflect
adjustments to the Company’s financial information prepared in accordance with
IFRS by excluding (i) the amortization of acquired intangibles of €159.6 million and
€133.4 million for 2015 and 2014, respectively, (ii) share-based compensation
expense and related social charges of €42.5 million and €43.3 million for 2015 and
2014, respectively, and (iii) other operating income and expense, net of
€12.4 million and €39.3 million for 2015 and 2014, respectively. For the
reconciliation of this non-IFRS financial information with information set forth in
the Company’s financial statements and the notes thereto, see paragraph 3.1.1.2
“Supplemental Non-IFRS Financial Information”.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
79
3 Financial Review and prospects
Operating and Financial Review
Cost of Software Revenue
(excluding amortization of acquired intangibles)
The cost of software revenue includes principally software
personnel costs, licensing fees paid for third-party components
integrated into the Company’s own products, preparation
costs for user manuals and delivery costs.
(in millions, except percentages)
2015
2014
Year ended December 31,
Cost of software revenue
(excluding amortization
of acquired intangibles)
(as % of total revenue)
€143.2
5.0%
€117.3
5.1%
IFRS cost of software revenue (excluding amortization of
acquired intangibles) increased 22.1% and primarily reflected
both the addition of acquisitions and negative currency effects.
Excluding a net negative currency impact of approximately
12 percentage points cost of software revenue (excluding
amortization of acquired intangibles) increased 10% due to
the addition of acquisitions and to a lesser extent from organic
costs, including higher royalty and Cloud costs.
On a non-IFRS basis and excluding unfavourable currency
effects, cost of software revenue (excluding amortization
of acquired intangibles) similarly increased 10% in total of
which 7 percentage points came from scope increase with the
acquisitions and 3 percentage points of organic expense growth.
Cost of Services and Other Revenue
The cost of services and other revenue includes principally
personnel and other costs related to organizing and providing
consulting, deployment services, content creation and
educational services less the technical support provided to
sales operations.
(in millions, except percentages)
2015
2014
Year ended December 31,
Cost of services
and other revenue
(as % of total revenue)
€294.7
10.4%
€225.9
9.8%
Cost of services and other revenue increased 30.5% and on
a non-IFRS basis increased 30.3%, principally due to the
addition of acquisitions and to currency effects. Excluding a net
currency impact of approximately 8 percentage points, cost of
services and other revenue increased 22%, largely reflecting
growth in personnel and related costs from acquisitions and in
part to underlying organic expense increase.
Research and Development Expenses
its ongoing significant
The Company believes that
investment in R&D is one of the most important elements
of its success. The Company conducts its research primarily
in France, the United States and Germany, as well as in
India, Malaysia, the United Kingdom, Netherlands, Poland,
Australia and Canada.
Expenses for R&D include primarily personnel costs as well
as the rental, depreciation and maintenance expenses for
computers and computer hardware used in R&D, development
tools, computer networking and communication expenses.
Costs for R&D of software are expensed in the period in
which they were incurred. The Company generally does not
capitalize any R&D costs. A small percentage of R&D personnel
pursue R&D activities in the context of providing clients with
software maintenance, and their cost is thus included under
cost of software revenue.
Expenses for R&D are recorded net of grants recognized from
various governmental authorities to finance certain R&D
activities (mainly R&D tax credits in France).
(in millions, except percentages)
Research and development
expenses
(as % of total revenue)
Year ended December 31,
2015
2014
€492.5
17.3%
€409.7
17.9%
The Company continues to benefit from a strong focus on
investments in research and development, with underlying
organic investments and the acquisitions of Accelrys, a
leading provider of scientific innovation lifecycle management
software for the chemistry, biology and materials sciences
industries in April 2014 (BIOVIA brand) and Quintiq extending
the Company’s 3DEXPERIENCE offering to global business
operations planning.
IFRS research and development expenses increased 20.2% and
on a non-IFRS basis increased 20.9%. Excluding a net negative
impact of approximately 8 percentage points,
currency
growth in research and development reflected both organic
investments as well as the addition of the 2014 acquisitions.
Marketing and Sales Expenses
Marketing and sales expenses consist primarily of personnel
costs, which include sales commissions and personnel for
processing sales transactions; marketing and communications
expenses, including advertising; travel expenses; and marketing
80 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Review and prospects
Operating and Financial Review
3
Other Operating Income and Expense, net
Other operating income and expense, net, includes the impact
of events that are unusual, infrequent or generally non-
recurring in nature.
(in millions)
Other operating income and
expense, net
Year ended December 31,
2015
2014
€(12.4)
€(39.3)
income and
expense , net, decreased
Other operating
€26.9 million in 2015 principally reflecting lower acquisition-
related third-party professional fees of €(14.8) million as well
as lower restructuring costs of €(8.7) million. See Note 8 to the
consolidated financial statements.
3
Operating income
(in millions)
Operating income
Year ended December 31,
2015
€633.2
2014
€430.8
IFRS operating income growth of 47.0% in 2015 was due
to revenue growth of 23.8% and to a 3.5 percentage point
increase in the operating margin to 22.3% for 2015 compared
to 18.8% for 2014.
On a non-IFRS basis, operating income increased 26.6% to
€884.9 million for 2015, compared to €699.2 million for
2014. The non-IFRS operating margin increased to 30.8% for
2015 compared to 29.8% for 2014, reflecting approximately
120 basis points of organic improvement fully offsetting
acquisition dilution, and a favourable impact from currencies
of 100 basis points.
Financial revenue and other, net
Financial revenue and other, net includes (i) interest income
and interest expense, net; (ii) foreign exchange gains or losses,
net, primarily composed of realized and unrealized exchange
gains and losses on receivables and loans denominated in
foreign currencies; and (iii) one-time items, net principally
composed of net gains or losses on sales of investments.
infrastructure costs, such as information technology resources
used for marketing.
(in millions, except percentages)
Marketing and sales expenses
(as % of total revenue)
Year ended December 31,
2015
€892.2
31.4%
2014
€748.5
32.6%
IFRS marketing and sales expenses increased 19.2% and on a
non-IFRS basis increased 19.4% and included a net negative
impact of approximately 8 percentage points.
currency
Excluding currency effects, sales expenses increased reflecting
the combined impact of acquisitions as well as underlying
sales expense growth, while marketing expenses increased
solely due to change in scope with the 2014 acquisitions.
General and Administrative Expenses
General and administrative expenses consist primarily of
personnel costs of the finance, human resources and other
departments, including legal; third-party professional fees
(excluding acquisition-related fees) and other expenses; travel
expenses; related infrastructure costs, including information
technology resources as well as other expenses.
(in millions, except percentages)
General and administrative
expenses
(as % of total revenue)
Year ended December 31,
2015
2014
€211.7
7.5%
€189.4
8.3%
IFRS general and administrative expenses increased 11.8%
and on a non-IFRS basis, general and administrative expenses
increased 14.4%. Excluding an estimated net negative
currency impact of 6 percentage points, the growth of general
and administrative expenses was due largely to the addition
of acquisitions. On an organic basis and excluding currency
effects, non-IFRS general and administrative expenses
increased 2%.
Amortization of Acquired Intangibles
Amortization of acquired
includes mainly
amortization of acquired technology and acquired customer
relationships.
intangibles
Year ended December 31,
(in millions)
2015
2014
Financial revenue and other, net
Year ended December 31,
2015
€(0.1)
2014
€15.0
(in millions)
Amortization of acquired
intangibles
€159.6
€133.4
Amortization of acquired intangibles increased €26.2 million
or 19.6%, reflecting principally the 2014 acquisitions of
Accelrys in April and Quintiq in September, respectively.
2015 financial revenue and other, net was mainly comprised
of net financial interest income of €11.2 million (2014:
€17.1 million) and exchange losses of €(12.0) million (2014:
€(4.1) million). See Note 9 to the consolidated financial
statements.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
81
3 Financial Review and prospects
Operating and Financial Review
IFRS financial revenue and other, net decreased €15.1 million in
2015 principally due to higher exchange losses of €7.9 million
related to the high volatility of currencies and lower net
financial interest income of €5.9 million due to lower interest
rates. On a non-IFRS basis, financial revenue and other, net
decreased €13.3 million to €(0.1) million for 2015 compared
to €13.2 million in 2014, reflecting higher exchange losses of
€8.2 million in 2015 compared to 2014 as well as lower net
financial interest income of €5.7 million.
Income tax expense
(in millions, except percentages)
Income tax expense
Effective consolidated tax rate
Year ended December 31,
2015
€227.1
35.9%
2014
€153.3
34.4%
IFRS income tax expense increased €73.8 million in total in
2015 compared to 2014, of which €64.4 million of the change
was due to higher pre-tax income in 2015. The effective
consolidated tax rate increase was mainly due to the one-
time tax impact of the transfer of certain contracts in Asia.
See Note 10 to the consolidated financial statements for an
explanation of the differences between the effective tax rates
and the taxes computed at the statutory French tax rate of
38% for 2015 and 2014.
On a non-IFRS basis, income tax expense increased 24.1% to
€304.4 million for 2015, compared to €245.2 million for 2014,
due to growth of non-IFRS pre-tax income to €884.8 million
compared to €712.4 million for 2014. On a non-IFRS basis,
the effective tax rate was 34.4% for 2015 and 2014.
Net income and diluted net income per share
Year ended December 31,
(in millions, except per share data)
2015
2014
Net income attributable to
shareholders
Diluted net income per share
Diluted weighted average number
of shares outstanding
€402.2
€1.57
€291.3
€1.14
256.6
255.3
IFRS and non-IFRS net income per diluted share growth
principally benefited from strong revenue growth, the positive
influence from currencies and organic operating margin
expansion. IFRS diluted net income per share increased 37.7%
compared to 2014. Non-IFRS net income per diluted share
increased 23.6% to €2.25 per diluted share in 2015, compared
to €1.82 per diluted share in 2014. On a non-IFRS basis,
currency had a estimated net favourable impact of about 13
percentage points.
3.1.3 Trends in Quarterly Results
The Company’s quarterly new licenses revenue has varied
significantly and is likely to vary significantly in the future,
according to the Company’s business seasonality and
clients’ decision process. Service and other revenue activity
can also vary by quarter. The Company’s total software
revenue is, however, less sensitive to quarterly variation
due to its significant level of recurring software revenue,
which is comprised of maintenance revenue and on-premise
software subscriptions as well as initial cloud subscriptions.
In combination, maintenance and periodic licenses revenue
represented 71% of total IFRS software revenue in 2015 and
2014. This significant level of recurring software revenue has
served and continues to serve as a stabilizing factor when
new licensing activity is impacting revenue and net income.
Acquisitions and divestitures can also cause the different
elements of revenue to vary from quarter to quarter.
A significant portion of new license sales typically occurs in
the last month of each quarter, and the Company normally
experiences its highest new licenses sales for the year in its
fiscal fourth quarter ended December 31st. Software revenue,
total revenue, operating income, operating margin and net
income have generally been highest in the fourth quarter of
each year.
In 2015, total revenue for the fourth, third, second and first
quarters represented, respectively, 28.1% (29.3% in 2014),
23.8% (24.5% in 2014), 25.2% (24.3% in 2014) and 22.9%
(21.9% in 2014) of the Company’s total revenue for the year,
with the mix of revenues by quarter reflecting both seasonality
as described above and the carryover impact of acquisitions
completed during 2014.
Nonetheless, it is possible that the Company’s quarterly
total revenue could vary significantly and that its net income
could vary significantly, reflecting the change in revenues,
together with the effects of the Company’s investment plans.
See paragraph 1.6.1.14 “Variability in Quarterly Operating
Results”.
82 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Review and prospects
2016 Financial Objectives and Multi-Year Growth Plan
3
3.1.4 Capital Resources
Cash and cash equivalents and short-term
investments
amounted to €2.35 billion as of December 31, 2015 compared
to €1.18 billion as of December 31, 2014. The Company’s
net financial position was €1.35 billion at December 31,
2015, compared to €825.5 million at December 31, 2014,
and was comprised of cash, cash equivalents and short-term
investments, less long-term debt.
In 2015 the Company’s principal sources of liquidity were
cash from operations of €633.3 million, and proceeds from
the new five-year credit facility of €650.0 million, as well
as proceeds from the exercise of stock options amounting to
€35.9 million. During 2015 cash obtained from operations
was used principally to distribute cash dividends aggregating
€98.4 million (based upon the shareholders electing to
receive cash), to make additions to property, equipment
and intangibles of €43.6 million, to repurchase shares in
the amount of €28.3 million and to fund acquisitions of
€20.2 million net.
In 2014 the Company’s principal sources of liquidity were cash
from operations amounting to €499.5 million and proceeds
from exercise of stock options amounting to €57.9 million.
During 2014, the Company uses of cash were principally for
acquisitions in the amount of €952.9 million net, repurchase
of Company shares in the amount of €171.7 million and
distribution of cash dividends aggregating €35.8 million
(based upon the shareholders electing to receive cash). In
addition, the Company made additions to property, equipment
and intangibles of €45.4 million, and repaid borrowings
in the amount of €20.6 million. See also the Consolidated
Statements of Cash Flows in paragraph 4.1.1 “Consolidated
Financial Statements”.
Exchange rate fluctuations had a positive translation effect,
on cash and cash equivalent balances, of €55.2 million as of
December 31, 2015, and of €38.0 million as of December 31,
2014.
The Company follows a conservative policy for investing
its cash resources, mostly relying on short-term maturity
investments. Investment rules are defined by the Company’s
financial management and controlled by the Treasury
department of Dassault Systèmes SE.
3
3.2 2016 Financial Objectives and Multi-Year
Growth Plan
The Company confirms its initial 2016 non-IFRS financial
objectives which were announced on February 4, 2016, when
the preliminary, unaudited annual results for 2015 were
released. These objectives are subject to the assumptions
and cautionary statements set forth below and are subject
to revision, as market and business conditions evolve during
2016.
The Company’s initial 2016 non-IFRS financial objectives are
as follows:
(cid:125) 2016 non-IFRS revenue growth objective range of about 6%
to 7% in constant currencies (€2.98 billion to €3.01 billion
based upon the 2016 currency exchange rate assumptions
outlined below for its principal currencies);
(cid:125) 2016 non-IFRS operating margin of about 31%, compared
to 30.8% for 2015;
(cid:125) 2016 non-IFRS earnings per share of about €2.40,
representing a growth objective of about 7%, embedding
about 3 percentage points of assumed currency headwinds;
(cid:125) These financial objectives are based upon exchange rate
assumptions of U.S. dollar 1.14 per euro and Japanese
yen 130.00 per euro for 2016.
In addition to the 2016 objectives stated above, the Company
has outlined two goals for 2016. First, while the Company
sees a somewhat more volatile macro-environment in 2016
compared to 2015, based upon an increase in 3DEXPERIENCE
activity it has set a goal of organic double-digits new licenses
revenue growth in constant currencies for 2016. Second,
while it anticipates selective increases in investments in R&D
and Sales resources in 2016 compared to 2015, the Company
has, at the same time, set a goal targeting an increase in the
organic operating margin of about 50 basis points in constant
currencies for 2016.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
83
3 Financial Review and prospects
Interim and Other Financial Information
The Company’s objectives are prepared and communicated
only on a non-IFRS basis. The 2016 annual non-IFRS
objectives set forth above do not take into account the
following accounting elements and are based upon the 2016
currency exchange rate assumptions above: deferred revenue
write-downs currently estimated at approximately €2 million
for 2016; share-based compensation expense, including
related social charges, currently estimated at approximately
€62 million for 2016 and amortization expense for acquired
intangibles currently estimated at approximately €147 million
for 2016. These objectives do not include any impact from
other operating income and expense, net principally comprised
of acquisition, integration and restructuring expenses. These
estimates do not include any new stock option or share grants,
or any new acquisitions or restructurings completed after
February 4, 2016.
On June 13, 2014 in conjunction with its 2014 Capital Markets
Day, Dassault Systèmes unveiled its 2014-2019 multi-year
growth plan with the initiation of a 2019 non-IFRS EPS goal of
about €3.50 (on a split-adjusted basis), commenting that this
goal represents about a 15% compound annual growth rate
and is principally top-line driven with multiple key revenue
growth drivers. The EPS goal assumes a relatively stable share
count over the five-year period, and is based upon exchange
rates for the U.S. dollar of $1.37 and Japanese yen of JPY140
in comparison to the euro.
are
based
statements
forward-looking
The information above includes statements that express
objectives for the Company’s future financial performance.
Such
on
Dassault Systèmes management’s views and assumptions
as of the date of this Annual Report and involve known and
unknown risks and uncertainties. The Company’s actual
results or performance may be materially negatively affected
and differ materially from those in such statements due to a
range of factors as described in this Annual Report. For more
information regarding the risks facing the Company, see
paragraph 1.6 “Risk factors”.
3.3
Interim and Other Financial Information
Dassault Systèmes has not published any quarterly or half-year financial information since the date of its last audited financial
statements.
84 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
4
FINANCIAL
STATEMENTS
4.1 Consolidated Financial Statements 86
4.3 Legal and Arbitration Proceedings 150
CONTENTS
4.1.1 Consolidated Financial Statements
4.1.2 Statutory Auditors' Report on the Consolidated
Financial Statements
4.2 Parent Company Financial
Statements
86
122
124
4.2.1 Parent Company Financial Statements and Notes 124
4.2.2 Selected financial and other information
for Dassault Systèmes SE over the last five years
145
4.2.3 Statutory Auditors' Report on the Parent
Company Financial Statements
4.2.4 Statutory Auditors' Report on Related Party
Agreements and Commitments
146
148
DASSAULT SYSTÈMES ANNUAL REPORT 2015
85
4 Financial Statements
Consolidated Financial Statements
The consolidated and parent company fi nancial statements below will be submitted for approval at the General Meeting of
Shareholders of Dassault Systèmes scheduled for May 26, 2016.
4.1 Consolidated Financial Statements
In compliance with article 28 of the European Regulation no. 809/2004 of the European Commission, the consolidated fi nancial
statements for 2013 and 2014 are incorporated by reference in this Annual Report as stated on page 2 hereof.
4.1.1 Consolidated Financial Statements
Consolidated Statements of Income
(in thousands, except per share data)
New licenses revenue
Periodic licenses, maintenance and other software revenue
Software revenue
Services and other revenue
TOTAL REVENUE
Cost of software revenue
Cost of services and other revenue
Research and development
Marketing and sales
General and administrative
Amortization of acquired intangibles
Other operating income and expense, net
OPERATING INCOME
Interest income and expense, net
Other fi nancial income and expense, net
INCOME BEFORE INCOME TAXES
Income tax expense
NET INCOME
Attributable to:
Equity holders of the Company
Non-controlling interest
Earnings per share
Basic net income per share
Diluted net income per share
Year ended December 31,
Notes
2015
2014
€716,539
€579,360
1,786,240
1,455,625
4
2,502,779
2,034,985
336,676
259,295
2,839,455
2,294,280
(143,183)
(294,737)
(492,494)
(892,182)
(211,731)
(159,561)
(12,360)
633,207
11,172
(11,292)
633,087
(227,136)
€405,951
(117,332)
(225,919)
(409,660)
(748,428)
(189,440)
(133,376)
(39,309)
430,816
17,131
(2,195)
445,752
(153,302)
€292,450
€402,178
€291,241
€3,773
€1,209
€1.59
€1.57
€1.16
€1.14
8
9
9
10
11
11
The accompanying notes are an integral part of these consolidated fi nancial statements.
86 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Consolidated Financial Statements
4
Consolidated Statements of Comprehensive Income
(in thousands)
NET INCOME
Losses on cash fl ow hedges
Foreign currency translation adjustment
Income tax on items to be reclassifi ed
Other comprehensive income to be reclassifi ed to profi t or loss in subsequent periods,
net of tax
Remeasurements of defi ned benefi t pension plans
Income tax on items not being reclassifi ed
Other comprehensive income not being reclassifi ed to profi t or loss in subsequent
periods, net of tax
OTHER COMPREHENSIVE INCOME, NET OF TAX
TOTAL COMPREHENSIVE INCOME, NET OF TAX
Attributable to:
Equity holders of the Company
Non-controlling interest
The accompanying notes are an integral part of these consolidated fi nancial statements.
Year ended December 31,
Notes
2015
2014
€405,951
€292,450
23
22
(7,137)
173,658
2,549
169,070
1,331
(582)
749
169,819
(1,508)
187,036
575
186,103
(30,870)
9,712
(21,158)
164,945
€575,770
€457,395
€571,530
€451,510
€4,240
€5,885
4
DASSAULT SYSTÈMES ANNUAL REPORT 2015
87
4 Financial Statements
Consolidated Financial Statements
Consolidated Balance Sheets
(in thousands)
Assets
Cash and cash equivalents
Short-term investments
Trade accounts receivable, net
Income tax receivable
Other current assets
TOTAL CURRENT ASSETS
Property and equipment, net
Non-current fi nancial assets
Deferred tax assets
Intangible assets, net
Goodwill
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
(in thousands)
Liabilities and equity
Trade accounts payable
Accrued compensation and other personnel costs
Unearned revenue
Income tax payable
Other current liabilities
TOTAL CURRENT LIABILITIES
Deferred tax liabilities
Borrowings, non-current
Other non-current liabilities
TOTAL NON-CURRENT LIABILITIES
Common stock
Share premium
Treasury stock
Retained earnings and other reserves
Other items
Parent shareholders’ equity
Non-controlling interest
TOTAL EQUITY
TOTAL LIABILITIES AND EQUITY
Year ended December 31,
Notes
2015
2014*
12
12
13
13
14
15
10
17
18
19
10
20
19
€2,280,534
€1,104,206
70,752
739,141
48,367
102,386
71,286
627,662
78,160
99,198
3,241,180
1,980,512
135,326
132,498
115,284
136,737
69,526
86,345
1,024,809
1,125,995
1,662,333
1,563,269
3,070,250
2,981,872
€6,311,430
€4,962,384
€119,802
€130,327
274,933
778,036
47,570
91,525
246,623
636,750
16,870
104,307
1,311,866
1,134,877
213,854
1,000,000
298,012
1,511,866
128,357
454,448
222,393
350,000
295,610
868,003
128,182
484,208
(108,921)
(187,085)
2,797,556
2,489,667
197,091
28,488
3,468,531
2,943,460
19,167
16,044
23
3,487,698
2,959,504
€6,311,430
€4,962,384
*
The consolidated balance sheet as of December 31, 2014 has been restated to reflect the finalized purchase price allocation for prior year business combinations (see Note 16
Business Combinations).
The accompanying notes are an integral part of these consolidated fi nancial statements.
88 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Consolidated Statements of Cash Flows
(in thousands)
Net income
Adjustments for non-cash items
Changes in operating assets and liabilities
Net cash provided by operating activities
Additions to property, equipment and intangibles
Purchases of short-term investments
Proceeds from sales and maturities of short-term investments
Payment for acquisition of businesses, net of cash acquired
Other
Net cash used in investing activities
Proceeds from exercise of stock options
Cash dividends paid
Repurchase of treasury stock
Borrowings
Repayment of borrowings
Net cash provided by (used in) fi nancing activities
Effect of exchange rate changes on cash and cash equivalents
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
CASH AND CASH EQUIVALENTS AT END OF PERIOD
Supplemental disclosure
Income taxes paid
Cash paid for interest
The accompanying notes are an integral part of these consolidated fi nancial statements.
Financial Statements
Consolidated Financial Statements
4
Year ended December 31,
Notes
2015
2014
€405,951
€292,450
24
24
14, 17
16
23
23
20
20
203,530
23,780
633,261
(43,579)
(93,283)
99,087
(20,209)
(2,538)
187,748
19,255
499,453
(45,393)
(95,141)
94,783
(952,913)
(2,197)
(60,522)
(1,000,861)
35,927
(98,418)
(28,295)
650,000
(10,796)
548,418
55,171
57,893
(35,764)
(171,660)
-
(20,685)
(170,216)
37,970
1,176,328
(633,654)
1,104,206
1,737,860
€2,280,534
€1,104,206
€209,276
€189,434
€6,354
€5,205
4
DASSAULT SYSTÈMES ANNUAL REPORT 2015
89
4 Financial Statements
Consolidated Financial Statements
Consolidated Statements of Shareholders’ Equity
(in thousands)
Common
stock
Share
premium
Treasury
stock
Other items
Retained
earnings and
other
reserves
Foreign
currency
translation
adjustment
Cash fl ow
hedges
Parent
shareholders’
equity
Non-
controlling
interest
Total
Equity
JANUARY 1, 2014
€126,933
€425,972 €(105,732) €2,316,293
€(2,953) €(149,986) €2,610,527
€13,624 €2,624,151
291,241
−
−
291,241
1,209
292,450
(21,158)
(3,475)
184,902
160,269
4,676
164,945
Net income
Other
comprehensive
income, net of tax
COMPREHENSIVE
INCOME, NET OF
TAX
Dividends
Exercise of stock
options
Treasury stock
transactions
Share-based
payments
Other changes
DECEMBER 31,
2014
Net income
Other
comprehensive
income, net of tax
COMPREHENSIVE
INCOME, NET OF
TAX
Dividends
Exercise of stock
options
Treasury stock
transactions
Share-based
payments
Other changes
DECEMBER 31,
2015
−
−
−
−
−
−
802
70,330
1,188
49,457
−
−
−
−
−
270,083
(3,475)
184,902
(103,431)
−
−
−
−
−
−
−
−
−
−
−
451,510
(32,299)
5,885
457,395
(3,465)
(35,764)
50,645
(171,660)
29,950
4,787
−
−
−
−
50,645
(171,660)
29,950
4,787
(741)
(61,551)
(81,353)
(28,015)
−
−
−
−
−
−
29,950
4,787
€128,182
€484,208 €(187,085) €2,489,667
€(6,428)
€34,916 €2,943,460
€16,044 €2,959,504
402,178
−
−
402,178
3,773
405,951
749
(4,223)
172,826
169,352
467
169,819
402,927
(4,223)
172,826
(108,535)
−
−
−
−
−
−
−
−
−
−
−
571,530
(95,641)
4,240
575,770
(2,777)
(98,418)
35,224
(28,295)
40,194
2,059
−
−
−
1,660
35,224
(28,295)
40,194
3,719
(802)
(76,901)
78,164
(28,756)
−
−
−
−
−
−
40,194
2,059
€128,357
€454,448 €(108,921) €2,797,556 €(10,651)
€207,742 €3,468,531
€19,167 €3,487,698
−
−
−
93
−
−
−
12,801
884
34,340
−
−
−
−
−
The accompanying notes are an integral part of these consolidated fi nancial statements.
90 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Consolidated Financial Statements
4
Notes to the Consolidated Financial Statements for Years Ended
December 31, 2015 and 2014
CONTENTS
Note 1 Description of Business
92
Note 13 Trade Accounts Receivable,
Note 2
Summary of Signifi cant Accounting
Policies
Net and Other Current Assets
92
Note 14 Property and Equipment
Note 3
Segment and Geographic Information 96
Note 15 Non-Current Financial Assets
Note 4
Software Revenue
Note 5 Government Grants
Note 6
Personnel Costs
Note 7
Share-based Payments
Note 8 Other Operating Income
and Expense, Net
Note 9
Interest Income and Expense,
Net and Other Financial Income
and Expense, Net
Note 10
Income Taxes
Note 11 Earnings per Share
Note 12 Cash and Cash Equivalents
and Short-term Investments
98
99
99
99
102
102
103
104
105
106
107
108
108
110
111
112
113
4
Note 16 Business Combinations
Note 17
Intangible Assets
Note 18 Goodwill
Note 19 Other Liabilities
Note 20 Borrowings
Note 21 Derivatives and Currency
and Interest Rate Risk Management 113
Note 22 Post-employment Benefi ts
Note 23 Shareholders’ Equity
Note 24 Consolidated Statements
of Cash Flows
Note 25 Commitments and Contingencies
Note 26 Related-Party Transactions
Note 27 Principal Dassault Systèmes
Companies
115
117
119
119
120
121
DASSAULT SYSTÈMES ANNUAL REPORT 2015
91
4 Financial Statements
Consolidated Financial Statements
Note 1 Description of Business
refers
The “Company” or
to Dassault
the “Group”
Systèmes SE and its subsidiaries. The Company provides end-
to-end software solutions and services, designed to support
companies’ innovation processes, from specifi cation and
design of a new product, to its manufacturing, supply and
sale to the customer, through all stages of digital mock-up,
simulation, and realistic 3D virtual experiences representing
the end-user experience.
The Company’s global customer base includes companies in
12 industrial sectors: Aerospace & Defense; Transportation &
Mobility; Marine & Offshore; Industrial Equipment; High-Tech;
Architecture, Engineering & Construction; Consumer Goods &
Retail; Consumer Packaged Goods & Retail; Life Sciences;
Energy, Process & Utilities; Financial & Business Services and
Natural Resources. To serve its customers, the Company has
developed a broad software applications portfolio, comprised
of 3D modeling applications, simulation applications, social
and collaborative applications, and information intelligence
applications, all powered by its 3DEXPERIENCE platform.
Dassault Systèmes SE is a European company (Societas
Europaea), incorporated under the laws of France. The
Company’s registered offi ce is located at 10, rue Marcel
Dassault, in Vélizy-Villacoublay, France. The Dassault Systèmes
SE shares are listed in France on Euronext Paris. These
consolidated fi nancial statements were established under the
responsibility of the Board of Directors on March 17, 2016.
Note 2 Summary of Signifi cant Accounting Policies
The Company undertakes no early application of any standard
or interpretation or associated amendments which were
already published in the Offi cial Journal of the European Union
at December 31, 2015.
In addition, the Company’s consolidated fi nancial statements
do not take into account new standards, interpretations
and amendments not yet approved by the European Union
at December 31, 2015, notably IFRS 15 “Revenue from
contracts with customers”, expected to be effective as of
January 1, 2018, with early adoption permitted. The Company
is currently assessing the impact of IFRS 15 on its consolidated
fi nancial statements and plans to adopt the new standard on
the required effective date.
Summary of significant accounting policies
Use of estimates
The preparation of fi nancial statements in conformity with IFRS
requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities,
revenue and expenses and disclosure of contingent assets
and liabilities at the date of the fi nancial statements. Areas
involving the use of signifi cant estimates and assumptions
mainly
identifying
the different elements comprising a software arrangement,
including the distinction between upgrades/enhancements
include: assessing product
lifecycles;
Basis of preparation and consolidation
The accompanying consolidated fi nancial statements were
prepared in accordance with International Financial Reporting
Standards (“IFRS”) as adopted in the European Union. The
consolidated fi nancial statements are presented in thousands
of euros except where otherwise indicated.
The consolidated fi nancial statements include the accounts
of Dassault Systèmes SE and its subsidiaries. Companies
over which the Company has control are fully consolidated.
The Group controls an entity when it is exposed, or has
rights, to variable returns from its involvement with the
entity and has the ability to affect those returns through its
power over the entity. Companies over which the Company
exercises signifi cant infl uence are accounted for under the
equity method. Intercompany transactions and balances are
eliminated.
Impact of recently issued accounting standards
The following interpretation which was published in the
Offi cial Journal of the European Union at December 31, 2015
was applied for the fi rst time in 2015:
(cid:125) IFRIC 21 “Levies”, mandatory for fi nancial years beginning
on or after June 17, 2014. The interpretation addresses when
an entity should recognize a liability to pay a government
levy. The adoption of IFRIC 21 had no material impact on
the Company’s consolidated fi nancial statements.
92 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Consolidated Financial Statements
4
4
and new products; determining when technological feasibility
is achieved for its products; estimating the recoverable amount
of goodwill; determining the nature, fair value and useful
life of acquired intangible assets in a business combination;
determining assumptions to estimate the fair value of share-
based payments; assessing the recognition of deferred tax
assets; and making reasonable estimates about the ultimate
resolution of the Company’s tax uncertainties based on
current tax laws and the Company’s interpretation thereof.
Actual results and outcomes could differ from management’s
estimates and assumptions.
Foreign currency adjustments
The functional currency of the Company’s foreign subsidiaries
is generally the applicable local currency. Assets and liabilities
with functional currencies other than the euro are translated
into euro equivalents at the rate of exchange in effect on the
balance sheet date. Revenues, expenses and cash fl ows are
translated at the average exchange rates for the year unless this
average is not a reasonable approximation of the cumulative
effect of the rates prevailing on the transaction dates, in which
case revenues, expenses and cash fl ows are translated at the
rate on the dates of the transactions. Translation gains or
losses are recorded in Other items in shareholders’ equity.
Exchange differences on the settlement or retranslation
of monetary items in a currency other than the Company’s
and its subsidiaries’ functional currency are recorded in the
statement of income.
Revenue recognition
The Company derives revenue from two primary sources:
(1) new software licenses, periodic licenses, maintenance
and other software revenue, which includes software license
updates, technical support and the development of additional
functionalities of standard products requested by clients;
(2) consulting and training services and other revenue.
Revenues are disclosed net of taxes collected from customers
and remitted to governmental authorities.
New Software Licenses, Periodic Licenses, Maintenance
and Other Software Revenue
Software
license revenue represents fees earned from
granting customers licenses to use the Company’s software.
The Company’s software license revenue consists of perpetual
and periodic license sales of software products. Software
license revenue is recognized (to the extent the Company
has no remaining obligations to perform) when: evidence of
an arrangement exists, delivery and acceptance has occurred,
the amount of revenue and associated costs can be measured
reliably, and it is probable that the economic benefi ts
associated with the transaction will fl ow to the Company.
In instances when any of the four criteria are not met, the
Company defers recognition of software license revenue until
all criteria are met. Revenue related to the licensing of software
through value-added resellers (VARs) is generally recognized
when evidence of a sale to an end-user customer is provided to
the Company, assuming all other revenue recognition criteria
have been met.
Periodic licenses generally have a one-year term and the
corresponding fee is recognized ratably over the term of the
license.
Maintenance revenue represents periodic fees associated
with the sale of unspecifi ed product updates on a when-
and-if-available basis and technical support. Maintenance
agreements are entered into in connection with the initial
software license purchase. Maintenance support may be
renewed by the customer at the conclusion of each term.
Revenue from maintenance is recognized on a straight-line
basis over the term of the maintenance agreement.
Other software revenue mainly relates to the development
of additional functionalities of standard products requested
by clients and is recognized as the development work is
performed.
Recurring fees for periodic licenses, maintenance and other
software revenue are reported within software revenue.
Revenue under multiple-element arrangements, which
typically include new software licenses and maintenance
agreements sold together, is allocated to each element in
the arrangement primarily using the residual method based
upon the fair value of the undelivered elements. Discounts, if
any, are applied to the delivered elements, usually software
licenses, under the residual method. For maintenance, fair
value is generally determined based upon the expected
renewal rate.
Services and Other Revenue
Services and other revenue consists primarily of fees from
consulting services in methodology for design, deployment
and support, and training services. Services generally do not
require signifi cant modifi cation or customization of software
products and are accounted for separately to the extent they
are not essential to the functionality of software products.
Service revenues derived from time and material contracts are
recognized as time is incurred.
Service revenues derived from fi xed price contracts are
generally recognized using a percentage of completion basis.
For customer support contracts, when no performance pattern
is discernible, revenue is recognized ratably over the term of
the contract, generally one year, on a straight-line basis.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
93
4 Financial Statements
Consolidated Financial Statements
Share-based payment
The Company recognizes compensation expense for share-
based payment awards expected to vest on a straight-line
basis over the requisite service period of the entire award.
Forfeitures are estimated at the time of grant and revised, if
necessary, in subsequent periods if actual forfeitures differ
from initial estimates.
Stock options are measured at fair value on the date of the
grant using an option-pricing model based on assumptions
made by management on expected volatility, expected option
life and distributed dividends.
Performance shares are measured at fair value based on
the quoted price of the Company’s common stock on the
date of grant. The fair value may also include the impact of
a market condition based on an option-pricing model. Non-
market vesting conditions are excluded from the fair value
measurement but are taken into account to estimate the
number of shares that will eventually vest. At the end of each
reporting period, the Group reviews this estimate and records
the impact of changes to original estimate, if any, in the
statement of income.
For performance share plans that allow the benefi ciaries to
acquire shares either upon satisfaction of a market condition or
a non-market vesting condition, the Group estimates the fair
value of the equity instrument at grant date for each possible
outcome, and accounts for the share-based payment based on
the most likely outcome at the end of each reporting period.
Cost of software revenue
Cost of software revenue primarily includes software license
expense for software products included in the Company’s
software, maintenance costs and delivery expense.
Research and development
Research costs are expensed as incurred.
Costs incurred to develop computer software products include
mainly payroll and other headcount-related costs associated
with development of the Company’s products. They also
include amortization expense, lease and maintenance costs
of computer equipment used for product development,
software expenditures and costs of information technology
and communication.
Due to specifi cities in the software industry, the Company has
determined that technological feasibility is the key criteria
to capitalize development expenditure as it is generally the
last criteria to be met. Currently the risks and uncertainties
inherent in the software development process make it diffi cult
to demonstrate technological feasibility before a working
prototype has been completed, which generally occurs shortly
before the commercial release of its software products. As a
consequence, costs incurred after technological feasibility
is established that could potentially be capitalized are not
material.
Government grants
The Company receives grants from various governmental
authorities to fi nance certain research and development
activities, including research and development tax credits in
France that are treated as government grants because they are
realizable in cash in the event the Company has insuffi cient
income tax payable. Government grants are recognized as
a reduction of research and development costs or cost of
services and other revenue when the qualifying research and
development activities have been performed and there is
reasonable assurance that the grants will be received.
Other operating income and expense, net
The Company distinguishes income and expense that is
unusual, infrequent or generally non-recurring in nature in the
consolidated statement of income. Such income and expense
includes the impact of restructuring activity and other
generally non-recurring events, such as gain or loss on sale
of subsidiaries, costs directly related to acquisitions, and costs
related to site closings or moving from one site to another.
Other financial income and expense, net
Other fi nancial income and expense primarily includes the
impact of remeasuring fi nancial instruments at fair value, gains
and losses on disposals and the impairment of investments in
non-consolidated companies, exchange gains and losses on
monetary items and change in fair value of derivative fi nancial
instruments not qualifi ed for hedge accounting.
Income taxes
Deferred income tax is recognized using the liability method on
temporary differences arising between the tax bases of assets
and liabilities and their carrying amounts in the consolidated
fi nancial statements. However, deferred income tax is not
accounted for if it arises from initial recognition of an asset
or liability in a transaction other than a business combination
that, at the time of the transaction, affects neither accounting
nor taxable profi t or loss. Deferred income tax is determined
using tax rates and laws that have been enacted or substantially
enacted by the balance sheet date and are expected to apply
when the related deferred income tax asset is realized or the
deferred income tax liability is settled.
Deferred income tax assets are recognized only to the extent
that it is probable that future taxable profi t will be available
against which the temporary differences can be utilized.
Deferred income tax is provided on temporary differences
arising on investments in subsidiaries and associates, except
94 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Consolidated Financial Statements
4
4
where the timing of the reversal of the temporary difference
is controlled by the Company and it is probable that the
temporary difference will not reverse in the foreseeable future.
Allowance for doubtful accounts and loans receivable
The allowance for doubtful accounts and loans receivable
refl ects the Company’s best estimate of probable losses
inherent in the receivable balance. The Company determines
the allowance based on known troubled accounts, historical
experience and other currently available evidence.
Financial instruments
Fair Value – The carrying amounts of cash and cash
equivalents, short-term investments, accounts receivable,
accounts payable and accrued expenses approximate fair
value, due to the short-term maturities of such instruments.
Foreign exchange options and forward contracts, which are
designated and serve as hedges, are recorded at their fair
market value. Fair value is measured based on the following
fair value hierarchy: level 1: quoted price in active markets;
level 2: inputs observable directly or indirectly, other than
quoted price included in level 1; level 3: inputs not based
on observable market data. Cash, cash equivalents and
short-term investments are measured using the level 1 fair
value. Derivative instruments are measured using the level 2
fair value. Other investments that are not equity method
investments are measured using the level 3 fair value.
Cash and Cash Equivalents and Short-Term Investments –
The Company considers deposits with banks, investments in
money market mutual funds and marketable debt securities
with short-term maturities to be cash equivalents since they are
readily convertible to a known amount of cash and are subject
to an insignifi cant risk of change in value. Other marketable
debt securities and mutual funds that do not qualify as cash
equivalents are considered to be short-term investments and
are generally classifi ed as trading securities with changes in
fair value recorded in interest income and expense, net.
Non-Current Financial Assets – Non-current fi nancial assets
include, principally, available-for-sale equity securities at fair
value, loans, deposits and other non-current receivables at
amortized cost and equity method investments. For available-
for-sale equity securities, any unrealized holding gains and
losses excluded from operating results are recognized in the
income until
consolidated statements of comprehensive
realized. The Company assesses declines in the value of
individual investments to determine whether such decline is
other-than-temporary and thus the investment is impaired.
This assessment is made by considering available evidence
including changes in general market conditions, specifi c
industry and individual company data, the length of time
and the extent to which the market value has been less than
cost, the fi nancial condition and near-term prospects of the
individual company, and the Company’s intent and ability to
hold the investment.
Derivative Instruments – The Company uses derivative
instruments to manage exposures to foreign currency and
interest rates. Derivative instruments are measured at their
fair value and changes in the fair value affect the consolidated
statements of income unless specifi c hedge accounting criteria
are met. Changes in the fair value of derivatives designated as
cash-fl ow hedges are reported as a component of shareholders’
equity until the hedged item is recognized in earnings.
Property and equipment
Property and equipment are recorded at cost and depreciated
using the straight-line method over their estimated useful
lives: computer equipment, two to fi ve years; offi ce furniture
and equipment, fi ve to 10 years; buildings, 30 years;
leasehold improvements are depreciated over the shorter of
the life of the assets or the remaining lease term. Repair and
maintenance costs are expensed as incurred.
Intangible assets
Intangible assets primarily
include acquired technology,
contractual customer relationships and computer software.
Costs related to intangible assets are capitalized and amortized
using the straight-line method over their estimated useful
lives, which range from two to 16 years. No intangible assets
have been identifi ed with an indefi nite useful life.
Business combinations and goodwill
Business combinations are accounted for using the purchase
method. The cost of an acquisition is measured as the fair
value of the assets transferred, equity instruments issued
and liabilities incurred or assumed on the acquisition date.
Identifi able assets acquired and liabilities and contingent
liabilities assumed in a business combination are measured
initially at fair value at the date of acquisition, irrespective of
the extent of any non-controlling interest.
Goodwill is initially measured at cost being the excess of the
cost of the business combination over the Company’s share in
the net fair value of the acquiree’s identifi able assets, liabilities
and contingent liabilities.
After initial recognition, goodwill is measured at cost less any
accumulated impairment losses. For the purpose of impairment
testing, goodwill acquired in a business combination is, from
the acquisition date, allocated to each of the Company’s cash
generating units or group of cash generating units that are
expected to benefi t from the synergies of the combination,
DASSAULT SYSTÈMES ANNUAL REPORT 2015
95
4 Financial Statements
Consolidated Financial Statements
irrespective of whether other assets or liabilities of the acquiree
are assigned to those units.
Goodwill is tested whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable, and
at a minimum annually. For the purpose of the impairment
test, the Company relies upon projections of future cash fl ows
and takes into account assumptions regarding the evolution
of the market and its ability to successfully develop and
commercialize its products. Changes in market conditions
could have a major impact on the valuation of assets and
liabilities and could result in additional impairment losses.
Provisions
Provisions are recognized as liabilities to cover probable
outfl ows of resources that can be estimated and that result
from present obligations (legal, contractual or constructive)
relating to past events. In cases where a potential obligation
resulting from past events exists, but where occurrence of
the outfl ow of resources is not probable or where the amount
cannot be reliably estimated, a contingent liability is disclosed
among the Company’s commitments.
The amount of the provision provided is the best estimate of
the outfl ow of resources required to extinguish this present
obligation.
Treasury shares
Own equity instruments which are reacquired (treasury
shares) are recognized at cost and deducted from equity. Gains
and losses on the purchase, sale, issue or cancellation of the
Company’s own equity instruments are credited or charged to
shareholders’ equity and are not recognized in the statement
of income.
Borrowings
Borrowings are recognized initially at fair value, net of
transaction costs
incurred. Any difference between the
recorded amount and the redemption value is amortized into
income over the period of the borrowing using the effective
interest rate method.
Post-employment benefits
The Company’s payments for defi ned contribution plans are
recorded as expenses for the relevant period.
For defi ned benefi t plans concerning post-employment
benefi ts, the Company uses the projected unit credit method
to determine the present value of its obligations. Under this
method, benefi ts are attributed to periods of service according
to the plan’s benefi t formula. However, if an employee’s
service in later years will earn a materially higher level of
benefi t than in earlier years, benefi ts are attributed to periods
of service on a straight-line basis.
Actuarial gains and losses are charged or credited to equity in
other comprehensive income in the period in which they arise.
The future payments for employee benefi ts are measured on
the basis of future salary increases, retirement age, mortality
and length of employment with the Company, and are
discounted at a rate determined by reference to yields on long-
term high quality corporate bonds of a duration corresponding
to the estimated duration of the benefi t plan concerned.
The net expense for the year, corresponding to the sum of
the current service costs, past service costs and net interest
expense or income, is charged in full to operating income.
Note 3 Segment and Geographic Information
Operating segments are components of the Company for
which discrete fi nancial information is available and whose
operating results are regularly reviewed by management to
assess performance and allocate resources. The Company
operates in a single operating segment, the sale of software
solutions, whose aim is to offer customers an integrated
innovation process, from the development of a new concept
to the realistic experience of the resultant product, through
all stages of detailed design, scientifi c simulation and
manufacturing, thanks to the 3DEXPERIENCE platform.
The assessment of the operating segment’s performance
is based on the Group’s supplemental non-IFRS fi nancial
information (see paragraph 3.1.1.2 “Supplemental Non-
IFRS Financial Information”). The accounting policies used
differ from those described in Note 2 Summary of Signifi cant
Accounting Policies as follows:
(cid:125) the measure of operating segment revenue and income
includes the whole revenue that would have been recognized
by acquired companies had they remained stand-alone
entities but which is partially excluded from Group revenue
to refl ect the fair value of obligations assumed;
(cid:125) the measure of operating segment income excludes share-
based compensation expense and associated payroll taxes
(see Note 6 Personnel Costs and Note 7 Share-based
Payments), amortization of acquired intangibles, and other
operating income and expense, net (see Note 8 Other
Operating Income and Expense, Net).
96 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
(in thousands)
TOTAL REVENUE FOR OPERATING SEGMENT
Adjustment for unearned revenue of acquired companies
TOTAL REVENUE
(in thousands)
INCOME FOR OPERATING SEGMENT
Adjustment for unearned revenue of acquired companies
Share-based compensation expense and related payroll taxes
Amortization of acquired intangibles
Other operating income and expense, net
OPERATING INCOME
Financial Statements
Consolidated Financial Statements
4
Year ended December 31,
2015
2014
€2,876,652
€2,346,660
(37,197)
(52,380)
€2,839,455
€2,294,280
Year ended December 31,
2015
2014
€884,834
€699,174
(37,197)
(42,509)
(52,380)
(43,293)
(159,561)
(133,376)
(12,360)
(39,309)
€633,207
€430,816
4
Data by geographic operations of the Company is established according to geographical location of the consolidated companies
and is as follows:
(in thousands)
2015
Europe
of which France
of which Germany
Americas
of which the United States
Asia
of which Japan
TOTAL
2014
Europe
of which France
of which Germany
Americas
of which the United States
Asia
of which Japan
TOTAL
Total revenue
Total assets*
Additions to
property,
equipment and
intangibles
€984,154
€3,656,664
463,345
214,496
2,612,147
442,781
1,206,888
2,150,243
1,154,515
1,954,114
648,413
357,888
504,523
136,901
€22,447
18,134
891
12,370
11,580
8,762
1,207
€2,839,455
€6,311,430
€43,579
€864,599
€2,541,800
€17,371
439,108
211,131
903,602
850,581
526,079
373,838
1,524,100
450,348
1,996,773
1,779,693
423,811
175,173
14,405
1,030
23,151
22,525
8,371
2,727
€2,294,280
€4,962,384
€48,893
* 2014 figures have been restated to reflect the finalized purchase price allocation for prior year business combinations for a total amount of €(5.7) million (see Note 16 Business
Combinations).
DASSAULT SYSTÈMES ANNUAL REPORT 2015
97
4 Financial Statements
Consolidated Financial Statements
The Company also receives data that identifi es the location of the Company’s end-user customers. Using such information,
revenue by geographic area would be as follows:
(in thousands)
Europe
of which France
of which Germany
Americas
of which the United States
Asia
of which Japan
TOTAL REVENUE
Note 4 Software Revenue
Software revenue is comprised of the following:
(in thousands)
New licenses revenue
Periodic licenses and maintenance revenue
Other software revenue
SOFTWARE REVENUE
Breakdown of software revenue by main product line is as follows:
(in thousands)
CATIA software revenue
SOLIDWORKS software revenue
ENOVIA software revenue
Other
SOFTWARE REVENUE
Year ended December 31,
2015
2014
€1,226,426
€1,052,804
246,439
357,021
889,504
755,552
723,525
347,837
229,522
340,223
659,022
574,994
582,454
293,065
€2,839,455
€2,294,280
Year ended December 31,
2015
2014
€716,539
€579,360
1,765,873
1,444,327
20,367
11,298
€2,502,779
€2,034,985
Year ended December 31,
2015
2014
€938,484
€838,527
569,827
301,878
692,590
447,683
262,849
485,926
€2,502,779
€2,034,985
98 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Consolidated Financial Statements
4
Note 5 Government Grants
Government grants and other government assistance were recorded in the consolidated statements of income as a reduction to
research and development expenses and to cost of services and other revenue expenses, as follows:
(in thousands)
Research and development
Costs of services and other revenue
TOTAL GOVERNMENT GRANTS
Note 6 Personnel Costs
Personnel costs
Personnel
payments
(€40.2 million in 2015 and €30.3 million in 2014, see
Note 7 Share-based Payments) and associated payroll taxes
share-based
excluding
costs,
(in thousands)
Personnel costs
Social security costs
TOTAL
Note 7 Share-based Payments
Year ended December 31,
2015
€34,780
1,308
€36,088
2014
€43,099
-
€43,099
4
(€2.3 million in 2015 and €13.0 in 2014), are presented in the
following table:
Year ended December 31,
2015
2014
€(1,102,733)
€(882,120)
(252,212)
(215,836)
€(1,354,945)
€(1,097,956)
Compensation expense related to share-based payments is recorded in the consolidated statements of income as follows:
(in thousands)
Research and development
Marketing and sales
General and administrative
Cost of revenue
TOTAL COMPENSATION EXPENSE RELATED TO SHARE-BASED PAYMENTS
Year ended December 31,
2015
2014
€(16,968)
€(12,500)
(14,799)
(11,077)
(7,062)
(1,365)
(5,828)
(850)
€(40,194)
€(30,255)
DASSAULT SYSTÈMES ANNUAL REPORT 2015
99
4 Financial Statements
Consolidated Financial Statements
Changes during 2015 and 2014 of unvested options and performance shares were as follows:
UNVESTED AT JANUARY 1, 2014
Granted
Vested
Forfeited
UNVESTED AT DECEMBER 31, 2014
Granted
Vested
Forfeited
UNVESTED AT DECEMBER 31, 2015
Number of awards
Performance
shares
Stock options
Total
2,088,510
2,312,000
4,400,510
1,359,880
624,450
1,984,330
(888,750)
(2,272,000)
(3,160,750)
(70,800)
2,488,840
(54,600)
609,850
(125,400)
3,098,690
1,034,600
1,965,555
3,000,155
(773,550)
-
(76,500)
(170,150)
(773,550)
(246,650)
2,673,390
2,405,255
5,078,645
As of December 31, 2015, total compensation cost related to unvested awards expected to vest but not yet recognized was
€95.6 million, and the Company expects to recognize this expense over a weighted average period of 2 years, no later than
September 4, 2018.
Performance shares
A summary of the Company’s performance shares plans is as follows:
Plans
2010-02
2010-04
2010-05
2014-A
2014-B
2015-A
2015-B
Date of General Meeting of Shareholders
05/27/2010 05/27/2010 05/27/2010 05/30/2013 05/30/2013 09/04/2015 09/04/2015
Date of grant by Board of Directors
09/29/2011 09/07/2012 09/07/2012 02/21/2014 02/21/2014 09/04/2015 09/04/2015
Total number of shares granted
406,400
539,230
150,000
529,940
150,000
734,600
300,000
Restated total number of shares
granted(1)
Acquisition period (in years)(3)
812,800(2) 1,078,460(2)
300,000
1,059,880
300,000
734,600
300,000
Three or
four(4)
Three or
four(4)
Two
Four
Four
Two
Two
Performance conditions
See Note(5)
See Note(5)
See Note(6)
See Note(7)
See Note(7)
See Note(7)
See Note(7)
Performance conditions is reached
at December 31, 2015
Yes
Yes
Yes
N/A
N/A
N/A
N/A
(1) For shares granted before July 17, 2014, total number of shares granted has been restated to reflect the two-for-one stock split effected on July 17, 2014 (see Note 23 Shareholders’
Equity).
(2) Including 28,000 shares granted to the Chief Executive Officer (“CEO”), subject to an additional performance condition related to the CEO’s variable compensation.
(3) Subject to the condition that the beneficiary be an employee or a director of the Company at the acquisition date.
(4) Three years in France and four years outside of France.
(5) Non-market performance conditions based on actually realized non-IFRS diluted earnings per share of the Group compared to the upper limit of the non-IFRS diluted earnings per
share objective during three years (2011, 2012 and 2013 for 2010-02 Shares and 2012, 2013 and 2014 for 2010-04 Shares). The shares granted to the CEO are also subject to
an additional performance condition related to variable compensation dependent on achieving performance criteria previously established by the Board.
(6) Performance condition related to the CEO’s variable compensation dependent on achieving performance criteria previously established by the Board.
(7) Performance condition measured based on two alternative criteria, the growth of the non-IFRS diluted earnings per share of the Group or the outperformance of the price of the
Dassault Systèmes share compared to the performance of the CAC 40 index (market condition) for each of the years 2015, 2016 and 2017 for 2014-A and 2014-B Shares, and
for the year 2016 for 2015-A and 2015-B Shares, compared to the year 2014. Such growth or difference must be at least equal to a threshold established by the Board. The 2015-
B Shares granted to the CEO are also subject to an additional performance condition related to variable compensation dependent on achieving performance criteria previously
established by the Board.
Performance shares granted in 2015 are measured at fair value based on the quoted price of the Company’s common stock on
the date of grant.
100 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Consolidated Financial Statements
4
Stock option
The main features of the Group stock option plans are as
follows: Options vest over various periods ranging from one to
four years, subject to continued employment, options expire
eight to ten years from grant date, or after termination of
employment, whichever is earlier, options have generally been
granted at an exercise price equal to or greater than the grant-
date market value of the Company’s share.
Pursuant to an authorization granted by the shareholders at
the General Meeting of Shareholders held on May 30, 2013,
the Board of Directors decided to grant 1,965,555 options to
subscribe to Dassault Systèmes shares to certain employees
on September 4, 2015, at an exercise price of €62.
Such options shall be vested at the end of an acquisition
period of one to three years, subject to the condition that
the benefi ciary be an employee of the Company at the
acquisition date and to the achievement of certain non-market
performance objectives. The options expire ten years from
grant date or after termination of employment, whichever is
earlier.
The weighted average grant-date fair value of options granted
in 2015 was €11.44. It was estimated on the date of grant
using a Black-Scholes option pricing model. Assumptions
used are as follows: weighted-average expected life of 6
years, expected volatility rate of 22%, expected dividend yield
of 0.70% and average risk-free interest rate of 0.41%. The
expected volatility was determined using a combination of the
historical volatility of the Company’s stock and the implied
volatility of the Company’s exchange-traded options adjusted
for other factors, such as a comparison to the Company’s peer
group.
A summary of the Company’s stock option activity is as follows:
4
OUTSTANDING AS OF JANUARY 1,
Granted
Exercised
Forfeited
OUTSTANDING AS OF DECEMBER 31,
Exercisable
2015
2014
Number
of shares
5,287,411
1,965,555
(1,769,020)
(171,850)
5,312,096
2,906,841
Weighted
average
exercise price
€23.73
€62.00
€19.91
€47.57
€38.40
€21.50
Number
of shares
7,094,974
624,450
(2,375,837)
(56,176)
5,287,411
4,677,561
Weighted
average
exercise price
€21.06
€45.50
€21.32
€29.22
€23.73
€20.90
A summary of the remaining contractual life and the exercise price of options outstanding as of December 31, 2015 is presented
below:
Stock option plan
2008-02
2010-01
2014-01
2015-01
OUTSTANDING AS OF DECEMBER 31, 2015
Number
of shares
Remaining
life (years)
Exercise price
1,455,264
1,451,577
463,850
1,941,405
5,312,096
1.91
2.40
6.40
9.68
5.28
€19.50
€23.50
€45.50
€62.00
€38.40
DASSAULT SYSTÈMES ANNUAL REPORT 2015
101
4 Financial Statements
Consolidated Financial Statements
Note 8 Other Operating Income and Expense, Net
Other operating income and expense, net are comprised of the following:
(in thousands)
Acquisition costs (1)
Costs incurred in connection with relocation activities (2)
Restructuring costs (3)
Other
OTHER OPERATING INCOME AND EXPENSE, NET
Year ended December 31,
2015
2014
€(5,552)
€(20,312)
(5,085)
(1,556)
(167)
(6,438)
(10,286)
(2,273)
€(12,360)
€(39,309)
(1) In 2014, transaction costs primarily relating to the acquisition of Realtime Technology AG (renamed “Dassault Systemes 3DExcite GmbH”), Accelrys (renamed
“Dassault Systemes Biovia Corp.”) and Quintiq.
(2) In 2015 and 2014, primarily composed of expenses related to the reorganization of the Group’s premises in North America.
(3) In 2014, primarily composed of severance costs relating to the termination of employees following the Company’s decision to rationalize its sales organization principally in
Europe, as well as severance costs related to the closure of offices in the Unites States.
Note 9
Interest Income and Expense, Net and Other Financial
Income and Expense, Net
Interest income and expense, net and other fi nancial income and expense, net for the years ended December 31, 2015 and 2014
are as follows:
(in thousands)
Interest income (1)
Interest expense (2)
INTEREST INCOME AND EXPENSE, NET
Foreign exchange losses, net (3)
Other, net
OTHER FINANCIAL INCOME AND EXPENSE, NET
Year ended December 31
2015
2014
€18,576
€22,869
(7,404)
11,172
(11,963)
671
(5,738)
17,131
(4,060)
1,865
€(11,292)
€(2,195)
(1) Interest income is primarily composed of interests on cash, cash equivalents and short-term investments.
(2) In 2015, mainly includes interest expense of €6.3 million due pursuant to two term loan facility agreements entered into in October 2015 and June 2013, respectively, for €650
and €350 million, respectively. In 2014, mainly include interest expense of €4.4 million due pursuant to a term loan facility agreement entered into in June 2013 for €350 million
(see Note 20. Borrowings).
(3) Foreign exchange losses, net are primarily composed of realized and unrealized exchange gains and losses on receivables and loans denominated in U.S. dollars, Australian dollar
and Canadian dollar in 2015 and U.S. dollars and Japanese yen in 2014.
102 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Note 10 Income Taxes
Deferred tax assets and liabilities are as follows:
(in thousands)
Deferred tax assets:
Accelerated depreciation and amortization for fi nancial statement purposes
Profi t-sharing and pension accruals
Provisions and other expenses
Net tax loss and tax credit carryforward assets
TOTAL DEFERRED TAX ASSETS
Deferred tax liabilities:
Amortization of acquired intangibles
Accelerated depreciation and amortization for tax purposes
Other
TOTAL DEFERRED TAX LIABILITIES
NET DEFERRED TAX LIABILITY
Financial Statements
Consolidated Financial Statements
4
Year ended December 31,
2015
2014*
€49,072
€44,118
53,686
80,449
44,418
42,551
88,813
53,358
227,625
228,840
(288,605)
(300,143)
(22,568)
(15,022)
(48,948)
(15,797)
(326,195)
(364,888)
€(98,570)
€(136,048)
4
* Restated to reflect the finalized purchase price allocation for prior year business combinations for a total amount of €3.0 million (see Note 16 Business Combinations).
The schedule of deferred tax assets and liabilities is as follows:
(in thousands)
Current deferred tax assets
Non-current deferred tax assets
TOTAL DEFERRED TAX ASSETS
Current deferred tax liabilities
Non-current deferred tax liabilities
TOTAL DEFERRED TAX LIABILITIES
NET DEFERRED TAX LIABILITY
Year ended December 31,
2015
€76,425
38,859
115,284
(11,383)
(202,471)
(213,854)
2014*
€60,712
25,633
86,345
(12,824)
(209,569)
(222,393)
€(98,570)
€(136,048)
* Restated to reflect the finalized purchase price allocation for prior year business combinations for a total amount of €3.0 million (see Note 16 Business Combinations).
Non-current deferred tax liabilities mainly include the tax effect of intangible assets created through business combinations
(primarily Accelrys, Quintiq and Apriso).
Change in deferred taxes can be summarized as follows:
(in thousands)
NET DEFERRED TAX LIABILITY AS OF JANUARY 1,
Changes included in the income statement
Business combinations
Other changes included in shareholders’ equity
Currency translation adjustments
NET DEFERRED TAX LIABILITY AS OF DECEMBER 31,
Year ended December 31,
2015
2014*
€(136,048)
€(15,243)
42,461
(1,398)
5,540
(9,125)
39,887
(158,905)
9,352
(11,139)
€(98,570)
€(136,048)
* Restated to reflect the finalized purchase price allocation for prior year business combinations for a total amount of €3.0 million (see Note 16 Business Combinations).
DASSAULT SYSTÈMES ANNUAL REPORT 2015
103
4 Financial Statements
Consolidated Financial Statements
The components of income before income taxes are as follows:
(in thousands)
France
Foreign
INCOME BEFORE INCOME TAXES
The components of income tax expense are as follows:
(in thousands)
France
Foreign
CURRENT TAXES
Change in deferred taxes
INCOME TAX EXPENSE
Year ended December 31,
2015
2014
€298,189
€243,410
334,898
202,342
€633,087
€445,752
Year ended December 31,
2015
€(116,418)
(153,179)
(269,597)
42,461
2014
€(90,613)
(102,576)
(193,189)
39,887
€(227,136)
€(153,302)
Differences between the income tax provision and the provision computed using the statutory French income tax rate are as
follows:
(in thousands)
Taxes computed at the statutory rate of 38%
Foreign tax rate differentials
R&D tax credit and other tax credits(1)
Tax exempt income
Adjustments of prior income tax provision
Other, net(2)
INCOME TAX EXPENSE
Effective tax rate
Year ended December 31,
2015
2014
€(240,573)
€(169,386)
6,852
17,374
6,218
518
(17,525)
3,233
15,831
4,634
(1,754)
(5,860)
€(227,136)
€(153,302)
35.9%
34.4%
(1) R&D tax credit and other tax credits derived mainly from research tax credits in France and in the United States.
(2) In 2015, includes mainly tax impact in connection with transfer of certain contracts in Asia, and French cotisation sur la valeur ajoutée des entreprises (“CVAE”). In 2014, included
mainly tax impact in connection with French CVAE.
At December 31, 2015, there were unrecognized tax losses and tax credit carried forward of €61.3 million, which are scheduled
to expire after 2021.
Note 11 Earnings per Share
Basic net income per share is determined by dividing net
income attributable to equity holders of the Company by the
weighted average number of common shares outstanding
during the period. Diluted net income per share is determined
by dividing net income attributable to equity holders of
the Company by the combination of the weighted average
number of common shares outstanding during the period and
the dilutive effect of stock options and performance shares.
104 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
The following table presents the calculation for both basic and diluted net income per share:
(in thousands, except shares and per share data)
Net income attributable to equity holders of the Company
Weighted average number of shares outstanding
Dilutive effect of share-based payments
Diluted weighted average number of shares outstanding
Basic net income per share
Diluted net income per share
Financial Statements
Consolidated Financial Statements
4
Year ended December 31,
2015
2014
€402,178
€291,241
252,480,762
250,855,961
4,111,621
4,430,104
256,592,383
255,286,065
€1.59
€1.57
€1.16
€1.14
Note 12 Cash and Cash Equivalents and Short-term Investments
Cash and cash equivalents are comprised of the following:
(in thousands)
Bank accounts
Cash equivalents
CASH AND CASH EQUIVALENTS
4
Year ended December 31,
2015
2014
€88,716
€71,864
2,191,818
1,032,342
€2,280,534
€1,104,206
At December 31, 2015 and 2014, approximately 26% and
35% of cash and cash equivalents was denominated in
U.S. dollars, respectively.
Short-term investments of €70.8 and €71.3 million at
December 31, 2015 and 2014, respectively, were primarily
comprised of bank certifi cates of deposit, mutual funds and
fi xed term deposits. At December 31, 2015 and 2014, short-
term investments included approximately 59% and 53% of
investments denominated in U.S. dollars, respectively.
Cash, cash equivalents and short-term
investments are
maintained on deposit with high credit-quality fi nancial
institutions, principally in France. The Company follows a
conservative policy for investing its cash resources, mostly
relying on short-term maturity investments. Investment rules
are determined and controlled by the Treasury department of
Dassault Systèmes SE.
The Company has adopted policies regarding fi nancial
ratings and the spread of maturity dates in order to ensure
the security and liquidity of its fi nancial instruments. The
Company’s management oversees the credit-worthiness of
its counterparts and the quality of its investments closely and
believes that it has minimal exposure to the risk of bankruptcy
of any one of them. The Company also closely oversees the
liquidity of its fi nancial assets held at these same counterparts.
In this regard, the Company follows in particular the credit
rating of each of its counterparties and, up to the present
time, all of its counterparties are rated in the Investment Grade
category by rating agencies. As a result, the Company believes
that it has very low exposure to credit or counterparty risk.
The Group has a central cash management operated by a
banking institution. In this context, the parent company of the
bank offered a guarantee to the Group in the amount of €459
million, and at the same time the Group offered a guarantee to
the bank for the same amount.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
105
4 Financial Statements
Consolidated Financial Statements
Note 13 Trade Accounts Receivable, Net and Other Current Assets
Trade accounts receivable and other current assets are receivables measured at amortized cost.
Trade accounts receivable
(in thousands)
Trade accounts receivable
Allowance for trade accounts receivable
TRADE ACCOUNTS RECEIVABLE, NET
The maturities of trade accounts receivable, net, were as follows:
(in thousands)
Less than 3 months past due
3 to 6 months past due
More than 6 months past due
TRADE ACCOUNTS RECEIVABLE PAST DUE
Trade accounts receivable not yet due
TOTAL TRADE ACCOUNTS RECEIVABLE, NET
Year ended December 31,
2015
2014
€759,609
€648,732
(20,468)
(21,070)
€739,141
€627,662
Year ended December 31,
2015
2014
€77,814
€96,694
12,970
8,065
98,849
640,292
11,756
9,593
118,043
509,619
€739,141
€627,662
The Company is not dependent on any of its principal clients. No single customer or sales channel partner represented more than
5% of the Company’s total revenue in 2015 and 2014.
Other current assets
Other current assets consist of the following:
(in thousands)
Prepaid expenses
Value added tax
Derivatives, current (1)
Other current assets(2)
TOTAL OTHER CURRENT ASSETS
Year ended December 31,
2015
2014
€42,964
€39,097
40,248
2,272
16,902
35,302
4,931
19,868
€102,386
€99,198
(1) See Note 21. Derivatives and Currency and Interest Rate Risk Management.
(2) 2014 figures have been restated to reflect the finalized purchase price allocation for prior year business combinations for a total amount of €1.4 million (see Note 16 Business
Combinations).
106 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Consolidated Financial Statements
4
Note 14 Property and Equipment
Property and equipment consist of the following:
(in thousands)
Computer equipment
Offi ce furniture and equipment
Leasehold improvements
Buildings
TOTAL
Year ended December 31, 2015
Year ended December 31, 2014
Gross
Accumulated
depreciation
Net
Gross
Accumulated
depreciation
Net
€172,640
€(123,572)
€49,068
€151,990
€(104,034)
€47,956
55,790
100,682
7,057
(35,806)
(40,177)
(1,288)
19,984
60,505
5,769
50,471
92,328
6,347
(28,676)
(30,714)
(975)
21,795
61,614
5,372
€336,169
€(200,843)
€135,326
€301,136
€(164,399)
€136,737
The change in the carrying amount of property and equipment as of December 31, 2015 is as follows:
(in thousands)
NET PROPERTY AND EQUIPMENT
AS OF JANUARY 1, 2015
Additions
Other changes
Depreciation for the period
Exchange differences
NET PROPERTY AND EQUIPMENT AS OF
DECEMBER 31, 2015
Computer
equipment
Offi ce furniture
and equipment
Leasehold
improvements
Buildings
Total
€47,956
€21,795
€61,614
€5,372
€136,737
26,415
(1,338)
(25,912)
1,947
3,756
(414)
(6,431)
1,278
4,164
120
(9,796)
4,403
298
-
(251)
350
34,633
(1,632)
(42,390)
7,978
€49,068
€19,984
€60,505
€5,769
€135,326
The change in the carrying amount of property and equipment as of December 31, 2014 is as follows:
(in thousands)
NET PROPERTY AND EQUIPMENT
AS OF JANUARY 1, 2014
Additions
Business combinations
Other changes
Depreciation for the period
Exchange differences
NET PROPERTY AND EQUIPMENT AS OF
DECEMBER 31, 2014
Computer
equipment
Offi ce furniture
and equipment
Leasehold
improvements
Buildings
Total
€35,391
€15,724
23,307
10,487
225
(23,480)
2,026
7,348
3,885
(1,130)
(5,401)
1,369
€44,301
14,862
6,957
(704)
(7,913)
4,111
€5,032
€100,448
-
-
-
(216)
556
45,517
21,329
(1,609)
(37,010)
8,062
€47,956
€21,795
€61,614
€5,372
€136,737
4
DASSAULT SYSTÈMES ANNUAL REPORT 2015
107
4 Financial Statements
Consolidated Financial Statements
Note 15 Non-Current Financial Assets
Non-current fi nancial assets consist of the following:
(in thousands)
Tax receivable(1)
Loans receivable, non-current
Investments
Derivatives, non-current(2)
Deposits and other non-current fi nancial assets
NON-CURRENT FINANCIAL ASSETS
Year ended December 31,
2015
2014
€79,860
€22,194
15,169
11,194
8,643
17,632
14,487
12,422
4,663
15,760
€132,498
€69,526
(1) In 2015 and 2014, tax payments following tax reassessments which are disputed by the Group with the relevant authorities (see Note 25 Commitments and Contingencies).
(2) See Note 21 Derivatives and Currency and Interest Rate Risk Management.
Note 16 Business Combinations
The estimated fair values of assets acquired and liabilities
assumed in connection with the Accelrys, Quintiq and
SIMPACK acquisitions presented in the Group’s consolidated
fi nancial statements as of December 31, 2014 were provisional
and have been fi nalized in 2015.
Realtime Technology AG (renamed
“Dassault Systemes 3DExcite GmbH”)
On January 13, 2014, the Company acquired 84% of Realtime
Technology AG (“RTT”), and further increased its share to
100% as of December 31, 2014, for total cash consideration
of approximately €190.8 million. Headquartered in Munich,
Germany, RTT is a leading provider of professional high-end
3D visualization software, marketing solutions and computer
generated imagery services.
The allocation of the purchase price resulted in €113.1 million
of goodwill primarily composed of the synergies between
RTT and the Company’s activities, with the introduction of
a new brand, 3DEXCITE, extending the Company’s offerings
to address marketing professionals in its core and target
industries.
States, Accelrys is a leading provider of scientifi c innovation
lifecycle management software for chemistry, biology and
materials sciences industries.
The allocation of the purchase price resulted in €325.1 million
of goodwill. The primary items that generated goodwill
include mainly the value of the synergies between Accelrys
and the Company’s activities, with the creation of the BIOVIA
brand, addressing science-based industries.
Quintiq Holding B.V.
its
On September 8, 2014, the Company completed
acquisition of 100% of Quintiq Holding B.V. (“Quintiq”), for
cash consideration of approximately €256.5 million, including
a contingent consideration of approximately €6.7 million
paid in 2015 in connection with sales performance achieved
in 2014. Based in Bois-Le-Duc, the Netherlands, Quintiq is a
global leader in operations management and optimization.
The allocation of the purchase price resulted in €119.5 million
of goodwill. The primary items that generated goodwill
include mainly the value of the synergies between Quintiq and
the Company’s activities.
Accelrys Inc. (renamed “Dassault Systemes Biovia
Corp.”)
On April 29, 2014, the Company completed its acquisition
of 100% of Accelrys Inc. (“Accelrys”), for cash consideration
of approximately €541.5 million. Based in San Diego, United
Other acquisitions
In July 2014, the Company completed its acquisition of 100%
of SIMPACK and Sobios SAS for total cash consideration of
approximately €46.9 million. These transactions resulted in
€20.0 million of goodwill.
108 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Consolidated Financial Statements
4
Purchase price allocation
The fi nal allocation of RTT, Accelrys, Quintiq and other acquisitions’ purchase prices to identifi able assets acquired and liabilities
assumed based on estimated fair values at the date of the acquisition is as follows:
(in thousands)
Cash and cash equivalents
Trade accounts receivable
Other assets
Intangible assets acquired(1)
Unearned revenue(2)
Other liabilities
Deferred taxes, net
TOTAL IDENTIFIABLE NET ASSETS
Goodwill
TOTAL PURCHASE PRICE
RTT
€13,176
22,050
8,727
73,506
(985)
(13,582)
(25,205)
€77,687
113,143
Accelrys
€46,762
22,046
16,521
243,432
(12,669)
(24,048)
(75,661)
Quintiq
€7,148
18,082
10,326
180,219
(4,679)
(25,133)
(48,980)
€216,383
€136,983
325,106
119,495
Other
acquisitions
€6,518
1,669
2,451
40,447
(2,169)
(13,025)
(9,059)
€26,832
20,036
Total
€73,604
63,847
38,025
537,604
(20,502)
(75,788)
(158,905)
€457,885
577,780
€190,830
€541,489
€256,478
€46,868
€1,035,665
4
(1) Intangible assets acquired are subject to amortization and include the following:
(in thousands)
Software
Customer relationships
Other
RTT
€49,506
20,000
4,000
Accelrys
€58,595
184,115
722
Quintiq Other acquisitions
€167,013
13,206
-
€25,647
14,800
-
Total
€300,761
232,121
4,722
TOTAL INTANGIBLE ASSETS ACQUIRED
€73,506
€243,432
€180,219
€40,447
€537,604
(2) The carrying values of unearned revenue were reduced to reflect the fair value of obligations assumed. As a result, approximately €82.1 million of revenues that would have
otherwise been recorded by these entities had they not been acquired by the Company will not be recognized in the Company’s consolidated statements of income.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
109
4 Financial Statements
Consolidated Financial Statements
Note 17 Intangible Assets
Intangible assets consist of the following:
(in thousands)
Software
Customer relationships
Other intangible assets
Year ended December 31, 2015
Year ended December 31, 2014*
Gross
Accumulated
amortization
Net
Gross
Accumulated
amortization
Net
€1,030,711
€(503,038)
€527,673
€981,032
€(399,873)
€581,159
972,529
27,796
(482,146)
(21,043)
490,383
6,753
903,952
26,781
(366,521)
(19,376)
537,431
7,405
TOTAL INTANGIBLE ASSETS
€2,031,036
€(1,006,227)
€1,024,809
€1,911,765
€(785,770)
€1,125,995
* Restated to reflect the finalized purchase price allocation for prior year business combinations for a total amount of €(44.6) million (see Note 16 Business Combinations).
The change in the carrying amount of intangible assets as of December 31, 2015 is as follows:
(in thousands)
Software
Customer
relationships
Other intangible
assets
Total intangible
assets
NET INTANGIBLE ASSETS AS OF JANUARY 1, 2015*
€581,159
€537,431
€7,405
€1,125,995
Business combinations
Other additions
Amortization for the period
Exchange differences
4,661
8,879
(83,054)
16,028
-
-
-
67
4,661
8,946
(84,720)
37,672
(1,229)
(169,003)
510
54,210
NET INTANGIBLE ASSETS AS OF DECEMBER 31, 2015
€527,673
€490,383
€6,753
€1,024,809
* Restated to reflect the finalized purchase price allocation for prior year business combinations for a total amount of €(44.6) million (see Note 16 Business Combinations).
The change in the carrying amount of intangible assets as of December 31, 2014 is as follows:
(in thousands)
Software
Customer
relationships
Other intangible
assets
Total intangible
assets
NET INTANGIBLE ASSETS AS OF JANUARY 1, 2014
€324,340
€331,052
Business combinations*
Other additions
Amortization for the period
Exchange differences
300,761
3,077
(69,299)
22,280
232,121
253
(68,930)
42,935
€3,396
4,722
46
€658,788
537,604
3,376
(1,103)
(139,332)
344
65,559
NET INTANGIBLE ASSETS AS OF DECEMBER 31, 2014*
€581,159
€537,431
€7,405
€1,125,995
* Restated to reflect the finalized purchase price allocation for prior year business combinations for a total amount of €(44.6) million (see Note 16 Business Combinations).
intangible amortization expense was €169.0 and
Total
€139.3 million for the years ended December 31, 2015, and
2014, respectively. The future amortization expense relating
to all intangible assets that are currently recorded on the
consolidated balance sheet at December 31, 2015 is estimated
to be the following:
(in thousands)
2016
2017
2018
2019
2020 and thereafter
Estimated intangible assets’ amortization expense
€159,768
146,108
135,998
128,424
454,511
110 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Note 18 Goodwill
The change in the carrying amount of goodwill as of December 31, 2015 and 2014 is as follows:
(in thousands)
GOODWILL AS OF JANUARY 1,
Business combinations
Exchange differences and other changes
GOODWILL AS OF DECEMBER 31,
Financial Statements
Consolidated Financial Statements
4
Year ended December 31,
2015
2014*
€1,563,269
€872,952
4,401
94,663
577,780
112,537
€1,662,333
€1,563,269
* Restated to reflect the finalized purchase price allocation for prior year business combinations for a total amount of €31.2 million (see Note 16 Business Combinations).
The Company performed annual impairment tests in the
fourth quarter of 2015 and 2014; no impairment of goodwill
was identifi ed as a result of these tests.
For the purpose of the impairment test, the Company
identifi ed 12 cash-generating units (“CGUs”) or groups of
CGUs as of December 31, 2015, generally corresponding to
the Company’s main software products. Each CGU represents
the lowest level within the Company at which goodwill is
monitored for internal management purposes. Goodwill tested
for impairment purposes was allocated to each CGU, or groups
of CGUs that were expected to benefi t from the synergies of
the combination.
4
Goodwill allocated to each CGU or groups of CGUs is as follows:
(in thousands)
December 31, 2014*
Acquisitions
and other changes December 31, 2015
Exchange differences
BIOVIA
SIMULIA
CATIA
ENOVIA
DELMIA
GEOVIA
QUINTIQ
3DEXCITE
Other
TOTAL
€372,394
226,207
217,553
149,823
132,500
124,011
119,495
113,143
108,143
-
-
4,401
-
-
-
-
-
-
€1,563,269
€4,401
€42,565
€414,959
21,724
8,469
15,087
12,341
(8,449)
-
-
2,926
€94,663
247,931
230,423
164,910
144,841
115,562
119,495
113,143
111,069
€1,662,333
* Restated to reflect the finalized purchase price allocation for prior year business combinations for a total amount of €31.2 million (see Note 16 Business Combinations).
The recoverable amount of each CGU or groups of CGUs has
been determined based on a value in use calculation. This
calculation uses cash fl ow projections based on fi nancial
budgets covering a fi ve- to ten-year period. The ten-year
period projections are used for activities that have longer
development cycles, representing approximately 62% of
the Group’s total goodwill as of December 31, 2015. Key
assumptions used to determine the value in use of assets are
derived from management objectives for revenue growth and
operating margin of each CGU or groups of CGUs. The pre-tax
discount rates are between 10.2% and 13.0%. Cash fl ows
beyond that fi ve- to ten-year period have been extrapolated
using a steady growth rate comprised between 2% and 3%,
refl ecting long-term growth rates in the software industry.
At December 31, 2015, based on management estimates, the
Company concluded that the value in use of each CGU or groups
of CGUs exceeded its carrying value. Management believes
that any reasonable possible change in key assumptions
described above on which recoverable amount is based would
not cause each CGU or groups of CGUs’ carrying amount to
signifi cantly exceed its recoverable amount. In particular, an
increase of 150 basis points in the pre-tax discount rate or a
decrease of 100 basis points in the long-term growth rates
would not cause each CGU or groups of CGUs’ carrying amount
to signifi cantly exceed its recoverable amount, except GEOVIA
for which an increase of 30 basis points in the pre-tax discount
rate or a decrease of 40 basis points in the long-term growth
rate would cause the recoverable amount to equal carrying
amount.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
111
4 Financial Statements
Consolidated Financial Statements
Note 19 Other Liabilities
Other liabilities are comprised of the following:
(in thousands)
Value added tax and other taxes
Provisions, current (1)
Borrowings, current (2)
Derivatives, current (3)
Other current liabilities (4)
TOTAL OTHER CURRENT LIABILITIES
Post-employment benefi ts (5)
Provisions, non-current (1)
Accrual for deferred lease incentives
Employee profi t sharing, non-current
Derivatives, non-current (3)
Other non-current liabilities
TOTAL OTHER NON-CURRENT LIABILITIES
Year ended December 31,
2015
€75,377
7,555
-
1,129
7,464
2014
€62,880
12,408
9,984
298
18,737
€91,525
€116,838
€104,307
€114,915
77,610
46,256
27,467
13,843
15,998
75,325
46,090
25,774
12,163
21,343
€298,012
€295,610
(1) See reconciliation of provisions below.
(2) See Note 20 Borrowings.
(3) See Note 21 Derivatives and Currency and Interest Rate Risk Management.
(4) 2014 figures have been restated to reflect the finalized purchase price allocation for prior year business combinations for a total amount of €(4.3) million (see Note 16 Business
Combinations).
(5) See Note 22 Post-employment Benefits.
The change in the carrying value of provisions as of December 31, 2015 is as follows:
(in thousands)
PROVISIONS AS OF JANUARY 1, 2015*
Additions
Utilization
Reversal of unused amounts
Exchange differences and oher
PROVISIONS AS OF DECEMBER 31, 2015
Tax risks
€60,107
20,631
(329)
(19,653)
1,557
€62,313
Claims,
litigation
and other
€15,478
2,849
(6,279)
(1,078)
424
Restructuring Total provisions
€12,148
6,680
(6,925)
(1,072)
627
€87,733
30,160
(13,533)
(21,803)
2,608
€85,165
€11,394
€11,458
* Restated to reflect the finalized purchase price allocation for prior year business combinations for a total amount of €(5.1) million (see Note 16 Business Combinations).
112 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Consolidated Financial Statements
4
Note 20 Borrowings
In October 2015, the Company entered into a new fi ve-year
term loan facility agreement, which maturity can be extended
by two additional years , for €650 million. The facility
was immediately fully drawn down and bears interest at
Euribor 1 month plus 0.50% per annum.
In June 2013, the Company entered into a term loan facility
agreement for €350 million, which was immediately fully
drawn down. The facility provides credit for a period of 6 years
and bears interest at Euribor 1 month plus 0.55% per annum.
In April 2010, the Company entered into a term loan facility in
Japan for JPY14,500 million (the equivalent of €115.0 million
as of the draw date) in order to fi nance a portion of the IBM
PLM acquisition. The facility bore interest at Japanese yen
Libor 1 month plus 0.60% per annum and was scheduled to
be repaid in ten equal semi-annual installments. The Company
repaid the last installment in June 2015.
The table below provides a breakdown of total borrowings by contractual maturity date as of December 31, 2015:
(in thousands)
Term loan facilities in euros
Payments due by period
Total
€1,000,000
Less than
1 year
€–
1-3 years
3-5 years
€–
€1,000,000
4
Note 21 Derivatives and Currency and Interest Rate Risk
Management
The fair market values of derivative
instruments were
determined by fi nancial institutions using option pricing
models.
All fi nancial instruments related to the foreign currency hedging
strategy of the Company have maturity dates of less than 3
years when the maturity of interest rate swap instruments is
less than 5 years. Management believes counter-party risk on
fi nancial instruments is minimal since the Company deals with
major banks and fi nancial institutions.
A description of market risks the Company is exposed to is
provided in paragraph 1.6.2 “Financial and Market Risks”.
Foreign currency risk
The Company transacts in various foreign currencies, primarily
U.S. dollars and Japanese yen.
In 2015, revenue denominated in U.S. dollars represented
36.8% of total revenue, compared with 33.5% in 2014. The
Company’s operating expenses denominated in U.S. dollars
represented 36.3% of total operating expenses in 2015,
compared with 33.7% in 2014.
As a result, the Company’s net operating exposure to U.S.
dollars amounted to €245.0 million in 2015 (8.6% of the
Company’s total revenue). The average value of the U.S. dollar
increased by 20% against the euro in 2015 following a fl at
year in 2014, resulting in a positive impact on the Company’s
revenue and operating income in 2015, and a neutral impact
in 2014.
In 2015, revenue denominated in Japanese yen represented
11.8% of total revenue, fl at compared with 2014. The
Company’s operating expenses denominated in Japanese yen
represented 4.3% of total operating expenses in 2015 and
4.6% in 2014.
As a result, the Company’s net operating exposure to
Japanese yen amounted to €239.2 million in 2015 (8.4% of
the Company’s total revenue), and this exposure was in part
hedged through market instruments at a level of €104.8
million, as further described below. The average value of the
Japanese yen increased by approximately 4% against the
euro in 2015, after a decrease in value of approximately 8%
in 2014, resulting in a favourable impact on the Company’s
revenue and operating income in 2015 and negative impact
2014.
The Company usually hedges exchange rate risk related to its
revenues and expenses coming from usual and predictable
activity arising in the normal course of operations. The
Company may also cover occasional exchange rate risk arising
from specifi c transactions, such as acquisitions paid for in
foreign currencies. Hedging activities are generally carried out
and managed by Dassault Systèmes SE for its own account
and on behalf of its subsidiaries. In certain cases, however,
the Company can authorize selected subsidiaries to enter into
hedging instruments directly.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
113
4 Financial Statements
Consolidated Financial Statements
The table below sets forth, for the year ended December 31, 2015, the euro value of the Company’s revenue, operating expenses
and net position, before and after hedging, denominated in U.S. dollars, Japanese yen and other currencies, principally the euro:
(in thousands)
Revenue
Operating expenses
NET POSITION
Hedge
NET POSITION AFTER HEDGE
Year ended December 31, 2015
U.S. dollars
Japanese yen
Euro and other
currencies
Total
€1,045,931
€334,958
€1,458,566
€2,839,455
(800,892)
€245,039
(95,757)
(1,309,599)
(2,206,248)
€239,201
€148,967
€633,207
-
104,815
-
104,815
€245,039
€134,386
€148,967
€528,392
With all other variables held constant, movements in euro/
U.S. dollar exchange rates by +10% or -10% would have had
an impact of €(22.3) and €27.2 million on operating income,
respectively. In addition, with all other variables held constant,
movements in euro/Japanese yen exchange rates by +10% or
-10% would have had an impact of €(21.7) and €26.6 million
on operating income, respectively.
To manage currency exposure, the Company generally uses
foreign exchange forward contracts. Except as indicated in the
table below, the derivative instruments held by the Company
are designated as accounting hedges, have high correlation
with the underlying exposure and are highly effective in
offsetting underlying price movements.
The effectiveness of forward contracts and currency options
is measured using forward rates and the forward value of the
underlying hedged transaction. During 2015 and 2014, the
portion of gains or losses from hedging instruments excluded
from the assessment of effectiveness and the ineffective
portions of hedges was nil.
At December 31, 2015 and 2014, the fair value of instruments used to manage the currency exposure was as follows:
(in thousands)
Forward exchange contract Japanese yen/euros – sale (1)
Forward exchange contract euros/Indian rupees – sale (1)
Forward exchange contract euros/ U.S. dollars – sale (1)
Forward exchange contract U.S. dollars/Indian rupees – sale (1)
Forward exchange contract Japanese yen/U.S. dollars – sale (1)
Cross currency swaps Canadian dollars/euros (2)
Cross currency swaps Australian dollars/euros (2)
Other instruments (2)
2015
Nominal
amount
€133,832
27,189
36,741
20,467
-
61,683
71,735
51,906
Year ended December 31,
2014
Fair value
€(792)
1,865
(666)
471
-
6,449
2,082
(40)
Nominal
amount
€38,163
28,901
-
27,977
5,507
73,412
72,064
37,861
Fair value
€2,438
2,320
-
472
946
1,863
1,548
(294)
(1) Instruments entered into by the Company to hedge the foreign currency exchange risk of forecasted sales.
(2) Derivatives not designated as hedging instruments. Changes in the derivatives’ fair value were recorded in other financial income and expense, net in the consolidated statement
of income. These instruments mainly relate to the acquisition of Gemcom.
Interest rate risk
Except for their impact on the general economic environment,
which is diffi cult to quantify, the Company believes that
changes in interest rates in 2015 did not materially affect
its revenue and earnings before fi nancial income. Similarly,
interest rates are not expected to affect its business or future
operating income. Therefore, the Company’s interest rate risk
is primarily a risk related to a reduction of fi nancial revenue.
In October 2015, the Company entered into interest rate
swap agreements for a total amount of €650 million that
have the economic effect of modifying forecasted interest
obligations relating to the €650 million new French term loan
facility (see Note 20 Borrowings) so that the interest payable
effectively becomes fi xed at 0.72% from October 2015 until
October 2020.
In July 2013 and October 2014, the Company entered
into interest rate swap agreements for a total amount of
€350 million that have the economic effect of modifying
forecasted interest obligations relating to the €350 million
French term loan facility (see Note 20 Borrowings) so that
the interest payable effectively becomes fi xed at 1.48% from
June 2014 until June 2018 and 1.04% from June 2018 until
July 2019.
In June 2010, the Company entered into interest rate swap
agreements for a total amount of JPY14,500 million that
had the economic effect of modifying forecasted interest
114 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Consolidated Financial Statements
4
obligations relating to the term loan facility in Japan (see
Note 20 Borrowings) so that the interest payable effectively
became fi xed at 0.41% until June 2015. In June 2015, the
Company made the last term loan facility repayment and the
related interest rate swap instruments also matured.
The effectiveness of interest rate swap agreements is measured
using forward interest rates. In 2015 and 2014, the portion of
gains or losses from hedging instruments excluded from the
assessment of effectiveness and the ineffective portions of
hedges was nil.
Financial revenue, which is composed of interest income
from cash, cash equivalents and short-term investments, is
sensitive to fl uctuations in interest rates. As of December 31,
2015, cash and cash equivalents and short-term investments
totaled €2,351.3 million, including €713.0 million sensitive
to fl uctuations in interest rates mostly in Europe. With all
other variables held constant, an increase in interest rates of
100 basis points would have had a positive impact in 2015
of €7.5 million on fi nancial income and a decrease in interest
rates of 100 basis points would have had a negative impact of
€8.7 million.
At December 31, 2015 and 2014, the fair value of instruments used to manage the interest rate risk was as follows:
(in thousands)
Interest rate swaps in euros
Interest rate swaps in Japanese yen
Note 22 Post-employment Benefi ts
Year ended December 31,
2015
Nominal
amount
Fair value
2014
Nominal
amount
Fair value
4
€1,000,000
€(13,426)
€350,000
€(12,145)
-
-
9,984
(15)
Contributions made to defi ned contribution plans were
€21.5 million and €16.2 million in 2015 and 2014 respectively.
Retirement indemnity benefi ts vest and are settled as a lump
sum paid to the employee upon the employee’s retirement.
The Company provides defi ned benefi t retirement indemnities
to the employees of its French operations, and sponsors
defi ned benefi t pension plans for certain employees in the
United States. The Company also has certain defi ned benefi t
plans in other countries, mainly in Germany and in Japan.
In France, defi ned employee benefi ts
include certain
gratifi cations paid upon anniversary of employment and
retirement indemnities that are based upon an individual’s
years of credited service and annualized salary at retirement.
In the United States, pension benefi ts are based upon
years of credited service and the employee’s average fi nal
salary. Retirement benefi ts are funded by the Company’s
contributions to segregated pension plan assets, in an amount
that is suffi cient to meet or exceed the minimum annual
funding requirements of the Employee Retirement Income
Security Act. In 2011, the Company decided to freeze the
American defi ned-benefi t pension plan, and in 2015, certain
American participants received a lump sum distribution of
their benefi t from the plan.
The projected benefi t obligation was determined using the prospective method, based on the following assumptions:
Assumptions
Assumptions used to determine the benefi t obligation:
Discount rate
Europe
2.10%
Average rate of compensation increase
2.50% – 2.80%
Americas
4.40%
N/A
Asia
0.90%
2.60%
Europe
2.10%
2.50% – 2.80%
Americas
4.05%
N/A
Asia
0.80%
2.60%
Year ended December 31, 2015
Year ended December 31, 2014
Assumptions used to determine the net periodic benefi t cost:
Discount rate
Europe
2.10%
Average rate of compensation increase
2.50% – 2.80%
Americas
4.05%
N/A
Asia
0.80%
2.60%
Europe
3.50%
2.50% – 3.00%
Americas
4.90%
N/A
Asia
1.20%
2.60%
Year ended December 31, 2015
Year ended December 31, 2014
DASSAULT SYSTÈMES ANNUAL REPORT 2015
115
4 Financial Statements
Consolidated Financial Statements
Components of net periodic benefit cost
The components of net periodic benefi t cost were as follows:
(in thousands)
Current service cost
Interest cost on benefi t obligations
Interest income on plan assets
Other
NET PERIODIC BENEFIT COST
Obligations and funded status
Changes in benefi t obligations and plan assets as of December 31, 2015 and 2014 are as follows:
(in thousands)
Benefi t obligations at beginning of year
Current service cost
Interest cost on benefi t obligations
Remeasurement (gains) losses*
Change in scope
Benefi ts paid
Settlement
Exchange rate differences and other changes
BENEFIT OBLIGATIONS AT END OF YEAR
Fair value of plan assets at beginning of year
Employer contribution
Interest income on plan assets
Benefi ts paid
Remeasurement (losses)
Settlement
Exchange rate differences and other changes
FAIR VALUE OF PLAN ASSETS AT END OF YEAR
NET DEFINED BENEFIT LIABILITY
Year ended December 31,
2015
€(7,961)
(4,942)
2,326
698
2014
€(6,405)
(5,185)
2,626
(549)
€(9,879)
€(9,513)
Year ended December 31,
2015
2014
€185,245
€139,304
7,961
4,942
(3,845)
-
(3,578)
(6,557)
6,815
6,405
5,185
30,558
1,042
(3,026)
-
5,777
€190,983
€185,245
€70,330
€62,262
7,109
2,326
(1,415)
(2,461)
(5,990)
4,246
€74,145
3,154
2,626
(1,245)
(841)
-
4,374
€70,330
€(116,838)
€(114,915)
* Remeasurement gains and losses mainly arise from changes in financial assumptions. A decrease of 150 basis points in the discount rates would increase the obligation by €50.6
million.
The benefi t obligation by geographical location is as follows:
Europe
Americas
Asia
TOTAL BENEFIT OBLIGATIONS
The fair value of plan assets by geographical location is as follows:
Europe
Americas
TOTAL FAIR VALUE OF PLAN ASSETS
116 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Year ended December 31,
2015
67%
23%
10%
100%
2014
66%
26%
8%
100%
Year ended December 31,
2015
49%
51%
100%
2014
47%
53%
100%
Plan assets
The weighted average asset allocations are as follows:
Debt instruments
Equity instruments
TOTAL
Financial Statements
Consolidated Financial Statements
4
Year ended December 31,
2015
73%
27%
100%
2014
76%
24%
100%
Cash flows
The Company does not expect to make any additional contributions to its pension plans in 2016.
The following benefi t payments, which refl ect expected future service, as appropriate, are expected to be paid:
(in thousands)
2016
2017
2018
2019
2020
2021-2025
4
Total
€(3,781)
(4,522)
(5,167)
(6,526)
(6,827)
(55,247)
Note 23 Shareholders’ Equity
Shareholders’ equity activity
As of December 31, 2015, Dassault Systèmes SE had
256,714,186 common shares issued with a nominal value of
€0.50 per share.
The General Meeting of Shareholders of May 26, 2014
decided to split the par value of the Dassault Systèmes share
in two. Consequently, the Board of Directors meeting held on
the same day decided to defi ne July 17, 2014 as the effective
date of this split. Thus, for all former shares of €1 of nominal
value held as of July 17, 2014, shareholders received two new
shares of par value €0.50 each.
Changes in shares outstanding as of December 31, 2015 and 2014 are as follows:
(in number of shares)
SHARES ISSUED AS OF JANUARY 1,
Dividend paid in shares
Exercise of stock options
Cancellation of treasury stock
SHARES ISSUED AS OF DECEMBER 31,
Treasury stock as of December 31,
SHARES OUTSTANDING AS OF DECEMBER 31,
Year ended December 31,
2015
2014
256,364,077
253,865,970
185,709
1,604,620
1,769,020
2,375,837
(1,604,620)
(1,482,350)
256,714,186
256,364,077
(2,863,505)
(4,770,624)
253,850,681
251,593,453
DASSAULT SYSTÈMES ANNUAL REPORT 2015
117
4 Financial Statements
Consolidated Financial Statements
The primary objective of the Company’s capital management
is to ensure that it maintains a strong credit rating and
healthy capital ratios in order to support its business and for
the purpose of increasing the profi tability of shareholders’
equity and earnings per share. The Company manages its
capital structure and adjusts it in light of changes in economic
conditions. To maintain or adjust the capital structure, the
Company may adjust the dividend payment to shareholders,
return capital to shareholders or issue new shares. No changes
were made in the objectives, policies or processes during the
years ended December 31, 2015 and 2014.
Dividend rights
Dassault Systèmes SE is required to maintain a legal reserve
equal to 10% of the aggregate nominal value of its issued
share capital. The legal reserve balance was €12.8 and
€12.7 million as of December 31, 2015 and 2014, respectively,
and represents a component of retained earnings in the
consolidated balance sheet. The legal reserve is distributable
only upon the liquidation of Dassault Systèmes SE.
Distributable profi t, consisting of net income of the year
increased by retained earnings from prior years and after
deduction for legal reserve when required, is available for
distribution to shareholders of the Company as dividends.
Allocation of this profi t is subject to approval by the General
Meeting of Shareholders following recommendations by the
Board of Directors.
In 2015 and 2014, the Shareholders’ Meeting approved the
distribution of a dividend of €108.5 and €103.4 million for
2014 and 2013 respectively, and offered shareholders the
Components of other comprehensive income
option to receive payment of their dividend in the form of new
Dassault Systèmes shares. Shareholders who opted to receive
payment of the 2014 and 2013 dividend in the form of new
Dassault Systèmes SE shares represented approximately 12%
and 68% of Dassault Systèmes’ shares, respectively, resulting
in the issuance of 185,709 and 802,310 (1,604,620 after
the two-for-one stock split) new ordinary shares in 2015
and 2014, respectively. The cash dividend was paid in 2015
and 2014 in an aggregate amount of €95.6 million and
€32.3 million, respectively.
Dividends per share were €0.43 and €0.42 (after the two-for-
one stock split) as of December 31, 2014 and December 31,
2013, respectively.
A dividend of €2.8 and €3.5 million was paid to non-controlling
interest in 2015 and 2014 respectively.
Stock repurchase programs
The General Meeting of Shareholders authorized the Board of
Directors to implement a share repurchase program limited to
10% of the Company’s share capital. Under this authorization,
the Company may not buy shares at a price exceeding €90
per share or above a maximum annual aggregate amount of
€500 million.
Furthermore, the Group signed a liquidity agreement for
an initial period until December 31, 2015, automatically
renewable for subsequent 12-month terms. On December 31,
2015, 2,625,732 shares were purchased, at an average price
of €64.95, and 2,574,744 shares were sold, at an average
price of €65.42.
(in thousands)
Cash flow hedges:
(Losses) arising during the year
Less: reclassifi cation adjustments for gains or losses included in the income statement
Year ended December 31,
2015
2014
€(5,655)
1,482
€(2,290)
(782)
€(7,137)
€(1,508)
118 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Note 24 Consolidated Statements of Cash Flows
Adjustments for non-cash items consist of the following:
(in thousands)
Depreciation of property and equipment
Amortization of intangible assets
Non-cash share-based payment expense
Deferred taxes
Other
ADJUSTMENTS FOR NON-CASH ITEMS
Changes in operating assets and liabilities consist of the following:
(in thousands)
(Increase) in trade accounts receivable
(Decrease) Increase in accounts payable
Increase in accrued compensation
(Decrease) in income tax payable
Increase in unearned revenue
Changes in other assets and liabilities
CHANGES IN OPERATING ASSETS AND LIABILITIES
Financial Statements
Consolidated Financial Statements
4
Notes
14
17
7
10
Year ended December 31,
2015
€42,390
169,003
40,194
(42,461)
(5,596)
2014
€37,010
139,332
29,950
(39,887)
21,343
€203,530
€187,748
Year ended December 31,
2015
2014
€(71,581)
€(56,170)
(16,905)
27,260
(52)
85,475
(417)
23,543
418
(50,567)
86,712
15,319
€23,780
€19,255
4
Note 25 Commitments and Contingencies
Leases
The Company leases computer equipment, premises and offi ce equipment under operating leases. Rent expense under operating
leases was €74.9 million for the year ended December 31, 2015 and €61.9 million for the year ended December 31, 2014.
At December 31, 2015, future minimum annual rental commitments under non-cancelable lease obligations were as follows:
(in thousands)
2016
2017
2018
2019
2020
2021 and thereafter
TOTAL FUTURE MINIMUM LEASE PAYMENTS
Operating leases
€77,353
70,045
65,645
58,219
53,112
220,489
€544,863
3DS Paris Campus (Headquarters facilities in Vélizy-
Villacoublay)
The Company has
leased approximately 60,000 square
meters of offi ce space for its headquarters facilities located in
Vélizy-Villacoublay, outside Paris, France since June 30, 2008.
In February 2013, the Company entered into a new lease
agreement for its headquarters facilities for a non-cancelable
initial term of 10 years beginning with the delivery of an
additional 13,000 square meters of offi ce space expected by
year end 2016. Future minimum rental payments until the end
of the lease amount to approximately €253.2 million in the
aggregate and have been included in the table presented above.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
119
4 Financial Statements
Consolidated Financial Statements
3DS Boston Campus
The Company has leased approximately 25,000 square meters
of offi ce space for its campus located in United States since
June 1, 2011, regrouping the primary operating facilities of
the Company’s main American activities. The total rented
space will progressively increase, reaching 30,000 square
meters in 2017. Future minimum rental payments amount to
approximately €105.2 million in the aggregate and have been
included in the table presented above.
Litigation and other proceedings
The Company is involved in litigation and other proceedings,
such as civil, commercial and tax proceedings, incidental
to normal operations. The Company is subject to ongoing
tax audits and tax reassessments in jurisdictions in which
the Company has or had operations. Certain of these
reassessments, in particular those related to acquisition
fi nancing, are being challenged by the Company which is
strongly confi dent in the technical merits of its positions and
will continue to defend them with the relevant tax authorities.
In this context, the Company made payments to the French
tax authorities for €57.7 million and €22.2 million in 2015
and 2014 respectively, but disputed them with the relevant
authorities.
It is not possible to determine with certainty the outcome
of the dispute in these matters. However, in the opinion of
management, after consultation with legal and tax counsel,
the resolution of such litigation and proceedings should not
have a material effect on the consolidated fi nancial statements
of the Company.
Note 26 Related-Party Transactions
Compensation of key management personnel
The table below summarizes compensation granted to the members of the Group Executive Committee and to the Chairman of
the Board of Directors as of December 31, 2015 and 2014:
(in thousands)
Short-term benefi ts (1)
Share-based compensation (2)
COMPENSATION OF KEY MANAGEMENT PERSONNEL
(1) Including gross salaries, bonus, incentives, profit-sharing, directors’ fees and fringe benefits.
(2) Expense recorded in the income statement for share-based payments (stock options and performance shares).
Year ended December 31,
2015
€9,368
15,052
2014
€8,311
12,442
€24,420
€20,753
In certain circumstances, the Group Chief Executive Offi cer is
entitled to an indemnity payment upon the termination of
his functions as Chief Executive Offi cer. The amount of the
indemnity due would be equivalent to a maximum of two
years of compensation as Chief Executive Offi cer and would
depend on satisfying the performance conditions established
for calculating his variable compensation.
Other transactions with related parties
The Company licenses its products for internal use to Dassault
Aviation, a sister company to the Company. The Chairman of
Dassault Systèmes SE is also the Chief Executive Offi cer of
the Industrial Group Marcel Dassault which controls Dassault
Aviation. Dassault Aviation licenses the Company’s products
on commercial terms consistent with those granted to the
Company’s other customers of similar size. These licenses
generated €16.8 and €14.1 million of software revenue for
the years ended December 31, 2015 and 2014, respectively.
The Company also provides service and support to Dassault
Aviation. Such activity generated service revenues of €6.8
and €8.0 million in the years ended December 31, 2015 and
2014, respectively. The balances of trade accounts receivable
with Dassault Aviation were €7.1 million, and €8.0 million at
December 31, 2015 and 2014, respectively.
120 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Consolidated Financial Statements
4
Note 27 Principal Dassault Systèmes Companies
The principal Dassault Systèmes SE subsidiaries included in the scope of consolidation as at December 31, 2015 are as follows:
Country
France
Germany
Germany
Consolidated companies
Dassault Data Services SAS
Dassault Systemes Deutschland GmbH
Dassault Systemes 3DExcite GmbH
Netherlands
Quintiq Applications B.V.
Italy
Sweden
United Kingdom
United Kingdom
Canada
Canada
United States
United States
United States
United States
United States
United States
United States
United States
United States
China
India
India
Dassault Systemes Italia Srl
Dassault Systemes AB
Dassault Systemes UK Limited
Dassault Systemes Biovia Limited
Dassault Systèmes Canada Inc.
Dassault Systemes Canada Software Inc.
Dassault Systemes Americas Corp.
Dassault Systemes Corp.
Dassault Systemes Simulia Corp.
Dassault Systemes Services, LLC
Dassault Systemes SolidWorks Corporation
Dassault Systemes 3DExcite Corp. (formerly “RTT USA, Inc.”)
Dassault Systemes Biovia Corp.
Quintiq, Inc.
Spatial Corp.
Dassault Systèmes (Shanghai) Information Technology Co., Ltd
3D PLM Software Solutions Limited
Dassault Systemes India Private Limited
South Korea
Dassault Systemes Korea Corp.
Japan
Japan
Australia
Malaysia
Dassault Systemes K.K.
SolidWorks Japan K.K.
Dassault Systemes Geovia Australia Pty Ltd
Quintiq Sdn Bhd
*
The Company determined that it has control over 3DPLM. As a result, 3DPLM is fully consolidated in the Company’s consolidated financial statements.
4
% of Interest
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
42%*
100%
100%
100%
100%
100%
100%
DASSAULT SYSTÈMES ANNUAL REPORT 2015
121
4 Financial Statements
Consolidated Financial Statements
4.1.2
Statutory Auditors' Report on the Consolidated Financial
Statements
This is a free translation into English of the Statutory Auditors’ report issued in French and is provided solely for the convenience
of English speaking readers . The Statutory Auditors’ report includes information specifi cally required by French law in such
reports, whether modifi ed or not.
This information is presented below the opinion on the consolidated fi nancial statements and includes an explanatory
paragraph discussing the Auditors’ assessments of certain signifi cant accounting and auditing matters. These assessments were
considered for the purpose of issuing an audit opinion on the consolidated fi nancial statements taken as a whole and not to provide
separate assurance on individual account captions or on information taken outside of the consolidated fi nancial statements.
This report should be read in conjunction with, and construed in accordance with, French law and professional auditing standards
applicable in France.
To the Shareholders
In compliance with the assignment entrusted to us by your General Meetings of Shareholders, we hereby report to you, for the
year ended December 31, 2015, on:
(cid:125) the audit of the accompanying consolidated fi nancial statements of Dassault Systèmes;
(cid:125) the justifi cation of our assessments;
(cid:125) the specifi c verifi cation required by law.
These consolidated fi nancial statements have been approved by the Board of Directors. Our role is to express an opinion on these
consolidated fi nancial statements based on our audit.
I. Opinion on the consolidated fi nancial statements
We conducted our audit in accordance with professional standards applicable in France. T hose standards require that we plan
and perform the audit to obtain reasonable assurance about whether the consolidated fi nancial statements are free of material
misstatement. An audit involves performing procedures, using sampling techniques or other methods of selection, to obtain
audit evidence about the amounts and disclosures in the consolidated fi nancial statements. An audit also includes evaluating
the appropriateness of accounting policies used and the reasonableness of accounting estimates made, as well as the overall
presentation of the consolidated fi nancial statements. We believe that the audit evidence we have obtained is suffi cient and
appropriate to provide a basis for our audit opinion.
In our opinion, the consolidated fi nancial statements give a true and fair view of the assets and liabilities and of the fi nancial
position of the Group as at December 31, 2015 and of the results of its operations for the year then ended in accordance with
International Financial Reporting Standards as adopted by the European Union.
II. Justifi cation of our assessments
In accordance with the requirements of A rticle L. 823-9 of the French Commercial Code (Code de commerce) relating to the
justifi cation of our assessments, we bring to your attention the following matters:
(cid:125) the paragraph “Revenue recognition” of the Note 2 to the consolidated fi nancial statements sets out the accounting principles
and methods used to account for revenue including fi rstly new software licenses along with related maintenance, and secondly
services and other revenue;
(cid:125) the paragraph “Business combinations and goodwill” of the Note 2 to the consolidated fi nancial statements set out the
accounting principles and methods used to determine the value of the assets and liabilities acquired through business
combinations, which are based on signifi cant assumptions and estimates made by management;
(cid:125) the paragraph “Share-based payment” of the Note 2 to the consolidated fi nancial statements sets out the accounting principles
and methods used to determine the fair value of the share-based payment awards granted to the certain employees and
executives, which is based on signifi cant assumptions and estimates made by management.
As part of our work, we verifi ed the correct application of the above-mentioned accounting principles and methods, examined the
assumptions used and their application, and verifi ed that the information provided in the Notes 4, 7, 16, and 18 was appropriate.
These assessments were made as part of our audit of the consolidated fi nancial statements taken as a whole, and therefore
contributed to the opinion we formed which is expressed in the fi rst part of this report.
122 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Consolidated Financial Statements
4
III. Specifi c verifi cation
As required by law, and in accordance with professional standards applicable in France, we have also verifi ed the information
presented in the Group’s management report.
We have no matters to report as to its fair presentation and its consistency with the consolidated fi nancial statements.
Neuilly-sur-Seine and Paris-La Défense, on March 18 , 2016
The Statutory Auditors
PricewaterhouseCoopers Audit
French original signed by:
Pierre Marty
ERNST & YOUNG et A utres
French original signed by:
Pierre-Antoine Duffaud
4
DASSAULT SYSTÈMES ANNUAL REPORT 2015
123
4 Financial Statements
Parent Company Financial Statements
4.2 Parent Company Financial Statements
4.2.1 Parent Company Financial Statements and Notes
The 2015 fi nancial statements presented below are the individual parent company fi nancial statements of Dassault Systèmes SE.
Presentation of the parent company fi nancial statements and the valuation methods used
The fi nancial statements for the year ended December 31, 2015 have been prepared in accordance with the 2014 French General
Chart of Accounts (Plan comptable général), the French Commercial Code and French regulatory requirements. They are presented
in the same manner and prepared using the same valuation methods as the preceding year.
Results of operations of Dassault Systèmes SE
In 2015, operating revenue increased 12.7% to €1,281.4 million from €1,137.2 million in 2014. The portion of revenue earned
from export sales amounted to €1,064.7 million, or 84.4% of net sales. Software revenue increased 13.1% to €1,002.6 million
in 2015 from €886.4 million in 2014.
Operating expenses increased 10.3% to €971.8 million in 2015, from €880.6 million in 2014. The main drivers of this change
were:
(cid:125) a 12.1% increase in personnel costs resulting from the increase in headcount, linked to the transfer of employees principally
from Archividéo SA and Sobios SAS as part of the merger operations (transmissions universelles de patrimoine or TUP), from
the full year impact of the 2014 TUP and from salary increases and hiring;
(cid:125) a 9.3% increase in other purchases and external expenses, mainly due to an increase in fees relating to the Group anti piracy
program, and in expenses relating to IT services principally for on-line service activities;
(cid:125) a 15.2% decrease in depreciation and reserves, mainly resulting from a lower risk of non-collectability in Europe;
(cid:125) a 15.2% growth in other expenses, principally due to an increase in royalties owed on Group products that are distributed.
Operating income increased 20.7% to €309.6 million in 2015 compared to €256.6 million in 2014.
Financial income for 2015 amounted to €74.9 million, compared with €30.2 million for the preceding year, showing an increase
of €44.7 million. This change was principally due to additional dividends received from subsidiaries in 2015.
Exceptional income and loss amounted to an income of €33.4 million in 2015 compared to a loss of €22.8 million in 2014. This
is principally explained by a capital gain of €43.2 million on a sale of a shareholding.
In 2015, income tax expense amounted to €76.1 million as compared to €45.2 million in 2014. The effective income tax rate
increased slightly to 20.3% in 2015 compared to 19.8% in 2014.
Net income increased to €299.5 million in 2015 compared with €183.0 million in 2014.
At December 31, 2015, cash and short-term investments stood at €2,035.2 million, compared with €954.9 million at
December 31, 2014. This increase was principally due to the new €650 million loan facility, and to the cash generated from the
Group’s operations in the absence of signifi cant acquisition.
124 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Statement of income
(in thousands of euros)
OPERATING REVENUE
Revenue
Of which exports
Other revenue
OPERATING EXPENSE
Other purchases and external expenses
Taxes, duties and similar payments
Personnel Costs
Depreciation, amortization and provisions
Other operating expense
OPERATING INCOME
FINANCIAL INCOME AND EXPENSE, NET
CURRENT INCOME
EXCEPTIONAL INCOME/(LOSS)
REGULATED AND OPTIONAL EMPLOYEE PROFIT-SHARING
Contractual employee profi t-sharing (intéressement)
Mandatory employee profi t-sharing
INCOME TAX EXPENSE
NET INCOME
Financial Statements
Parent Company Financial Statements
4
Year ended December 31,
Notes
2015
2014
1,281,356
1,137,227
3
1,260,846
1,125,687
1,064,663
20,510
942,156
11,540
(971,754)
(880,631)
(387,266)
(354,382)
(21,874)
(20,095)
4
(340,468)
(303,616)
(31,219)
(36,812)
(190,927)
(165,726)
5
6
7
309,602
74,880
384,482
33,446
(42,323)
(21,160)
(21,163)
(76,133)
299,472
256,596
30,167
286,763
(22,752)
(35,842)
(17,921)
(17,921)
(45,164)
183,005
4
DASSAULT SYSTÈMES ANNUAL REPORT 2015
125
4 Financial Statements
Parent Company Financial Statements
Balance sheet
(in thousands of euros)
Assets
NON-CURRENT ASSETS
Intangible Assets
Property and Equipment
Non-current Financial Assets
CURRENT ASSETS
Receivables
Marketable Securities
Treasury Shares
Cash and cash equivalents
PREPAID EXPENSES
FOREIGN CURRENCY TRANSLATION ADJUSTMENT
TOTAL ASSETS
(in thousands of euros)
Liabilities
SHAREHOLDERS’ EQUITY
Capital
Share and contribution premiums
Legal reserve
Retained earnings
Income (loss) for the fi scal year
Regulated provisions
PROVISIONS FOR CONTINGENCIES AND LOSSES
FINANCIAL LIABILITIES
TRADE PAYABLES
UNEARNED REVENUE
FOREIGN CURRENCY TRANSLATION ADJUSTMENT
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
126 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Year ended December 31,
Notes
2015
Net
2014
Net
10
11
12
13
14
14
2,412,937
2,552,145
317,845
35,794
312,474
37,612
2,059,298
2,202,059
2,602,789
1,356,173
460,799
2,029,351
106,822
5,817
23,095
25,633
291,924
947,409
109,382
7,458
19,975
20,430
5,064,454
3,948,723
Year ended December 31,
Notes
2015
2014
15
2,954,719
2,802,674
128,357
726,039
12,818
128,182
755,799
12,693
1,784,847
1,710,502
299,472
183,005
16
17
19
20
3,186
80,898
1,027,661
955,437
42,874
2,865
12,493
78,119
376,962
648,450
40,418
2,100
5,064,454
3,948,723
Financial Statements
Parent Company Financial Statements
4
Notes to the Annual Financial Statements for Years Ended
December 31, 2015 and 2014
CONTENTS
Note 1 Description of Business
and Key Events of the Year
Note 2
Summary of Signifi cant Accounting
Policies
Note 3
Revenue Breakdown
Note 4
Personnel Costs
Note 5
Financial Income and Expense, Net
Note 6
Exceptional Income/Loss
Note 7
Income Tax
Note 8
Performance Shares
Note 9 Additional Information
Note 10
Intangible Assets
Note 11 Property and Equipment
Note 12 Non-Current Financial Assets
Note 13 Receivables
128
128
131
131
132
133
133
134
134
135
135
136
136
Note 14 Treasury
Note 15 Shareholders’ Equity
Note 16 Provisions for Contingencies
and Losses
Note 17 Financial Liabilities
Note 18 Elements Concerning Related
Companies
Note 19 Trade Payables
Note 20 Unearned Revenue
Note 21 Financial Commitments
Note 22 Other Commitments
and Contingencies
Note 23 Additional Information
Note 24
Information Relating to Subsidiaries
and Shareholdings
137
137
139
140
140
141
141
142
143
143
144
4
DASSAULT SYSTÈMES ANNUAL REPORT 2015
127
4 Financial Statements
Parent Company Financial Statements
Note 1 Description of Business and Key Events of the Year
Description of business
Dassault Systèmes SE provides end-to-end software solutions
and services, designed to support companies’ innovation
processes, from specifi cation and design of a new product,
to its manufacturing, supply and sale to the customer,
through all stages of digital mock-up, simulation, and
realistic 3D virtual experiences representing user experience.
Dassault Systèmes SE also operates as both a holding company
and a provider of services for the Dassault Systèmes Group.
The Company’s global customer base includes companies in
12 industrial sectors: Aerospace & Defense; Transportation
& Mobility; Marine & Offshore; Industrial Equipment; High-
Tech; Architecture, Engineering & Construction; Consumer
Goods & Retail; Consumer Packaged Goods & Retail; Life
Sciences; Energy, Process & Utilities; Financial and Business
Services; and Natural Resources. To serve its customers,
Dassault Systèmes SE has developed a broad software
applications portfolio, comprised of 3D modeling applications,
simulation applications, social and collaborative applications,
and information intelligence applications, all powered by its
3DEXPERIENCE platform.
Dassault Systèmes SE is a European company (Societas
Europaea) incorporated under the laws of France. The Company’s
registered offi ce is located at 10, rue Marcel Dassault, in Vélizy-
Villacoublay, France. The Dassault Systèmes SE shares are
listed in France on Euronext Paris. These fi nancial statements
were established under the responsibility of the Board of
Directors on March 17, 2016.
Key Events of the Year
As part of its program to simplify the organization of its legal
entities throughout the world, Dassault Systèmes SE carried
out three merger operations (transmissions universelles de
patrimoine) during the year:
(cid:125) January 1, 2015, Archividéo SA and Simpoe SAS;
(cid:125) April 1, 2015, Sobios SAS.
Since June 15, 2015, Dassault Systèmes has been a European
company (Societas Europaea, SE) incorporated under French
law. The decision to adopt this new status refl ects the
international dimension of the Group and its growing presence
in Europe.
In October 2015, Dassault Systèmes SE entered into a new
fi ve year term loan facility agreement, which maturity can
be extended by two additional years , for €650 million. The
facility was immediately drawn down and bears interest
at Euribor 1-month plus 0.50% per annum (see Note 17
Financial Liabilities). The Company has entered into interest
rate swap agreements to fi x interest payable (see Note 21
Financial Commitments).
Note 2 Summary of Signifi cant Accounting Policies
The fi nancial year lasts for 12 months from January 1 through
December 31.
The annual fi nancial statements for the fi scal year ended
December 31, 2015 have been prepared and are presented in
accordance with the French General Chart of Accounts 2014.
General accounting conventions have been applied in keeping
with the principle of prudence, the principle of continuity
of accounting methods from one year to the next, the
independence of fi nancial years, and the assumption that the
business is a going concern. Assets and liabilities are initially
recorded at historical cost.
Signifi cant accounting polices applied are as follows:
Revenue
(1) new software
Dassault Systèmes SE derives revenue from three primary
licenses,
sources:
maintenance and other software revenue, which includes
software
the
development of additional functionalities of standard products
technical support and
licenses, periodic
license updates,
requested by clients; (2) consulting and training services and
other revenue; and (3) royalties from distribution agreements
signed primarily with the Group’s subsidiaries.
Revenues are disclosed net of taxes collected from customers
and remitted to governmental authorities.
New Software Licenses, Periodic Licenses, Maintenance
and Other Software Revenue – Software license revenue
represents fees earned from granting customers licenses to
use the Company’s software. The Company’s software license
revenue consists of perpetual and periodic license sales of
software products. Software license revenue is recognized (to
the extent Dassault Systèmes SE has no remaining obligations
to perform) when: evidence of an arrangement exists, delivery
and acceptance has occurred, the amount of revenue and
associated costs can be measured reliably, and it is probable
that the economic benefi ts associated with the transaction
will fl ow to the Company. In instances when any of the four
criteria are not met, Dassault Systèmes SE defers recognition
of software license revenue until all criteria are met. Revenue
128 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Parent Company Financial Statements
4
related to the licensing of software through value-added
resellers (VARs) is generally recognized when evidence of
a sale to an end-user customer is provided to the Company,
assuming all other revenue recognition criteria have been met.
Periodic licenses generally have a one-year term and the
corresponding fee is recognized ratably over the term of the
license.
Maintenance revenue represents periodic fees associated
with the sale of unspecifi ed product updates on a when-
and-if-available basis and technical support. Maintenance
agreements are entered into in connection with the initial
software license purchase. Maintenance support may be
renewed by the customer at the conclusion of each term.
Revenue from maintenance is recognized on a straight-line
basis over the term of the maintenance agreement.
Other software revenue mainly relates to the development
of additional functionalities of standard products requested
by clients and is recognized as the development work is
performed.
Recurring fees for periodic license, maintenance and other
software revenue are reported within software revenue; see
Note 3 Revenue.
Revenue under multiple-element arrangements, which
typically include new software licenses and maintenance
agreements sold together, is allocated to each element in
the arrangement primarily using the residual method based
upon the fair value of the undelivered elements. Discounts, if
any, are applied to the delivered elements, usually software
licenses, under the residual method. For maintenance, fair
value is generally determined based upon the expected
renewal rate.
Services and Other Revenue – Services and other revenue
consists primarily of fees from consulting services
in
methodology for design, deployment and support, and
The useful life of property and equipment is presented below:
training services. Services generally do not require signifi cant
modifi cation or customization of software products and are
accounted for separately to the extent they are not essential
to the functionality of software products. Service revenues
derived from time and material contracts are recognized as
time is incurred.
Service revenues derived from fi xed price contracts are
generally recognized using a percentage of completion basis.
For customer support contracts, when no performance pattern
is discernible, revenue is recognized ratably over the term of
the contract, generally one year, on a straight-line basis.
Research and development
Research costs are expensed as
incurred. T echnological
feasibility is not demonstrated before a working prototype
has been completed. Technological feasibility is generally
demonstrated shortly before the commercial release of
software products. As a consequence, costs incurred after
technological feasibility
is established and that could
potentially be capitalized are not material.
Intangible assets, property and equipment
Intangible assets, property and equipment are recognized at
cost, including ancillary expenses, when they are purchased,
at their production cost when they are produced internally,
and at their integration value when they are transferred.
resulting
Technical defi cits
from merger operations
(transmissions universelles de patrimoine) are recorded as
goodwill. Technical defi cits are considered as not depreciable
items. However, these items undergo impairment testing
when there is an evidence of risk and can be depreciated.
Intangible assets are amortized using the straight-line method
over their expected useful life (three to fi ve years for software
and fi ve to ten years for intellectual property).
4
Computer equipment
Fixtures and fi ttings
Offi ce furniture
Transportation equipment
Depreciation period
3 to 5 years
Over the term of the lease
10 years old
4 years
Depreciation, whether calculated using the straight-line or declining balance method, is calculated over the useful life of the asset.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
129
4 Financial Statements
Parent Company Financial Statements
Non-current Financial Assets
Provisions for Contingencies and losses
Investments in subsidiaries are recognized at cost without
revaluation of the transaction currencies. Expenses directly
related to the acquisition of equity securities are included in
the acquisition cost of these securities. Loans and advances to
subsidiaries are valued at their net realizable value.
Provisions for contingencies and losses are recognized as
liabilities to cover probable outfl ows of resources resulting
from a present obligation. These provisions are estimated
taking in account the most probable hypothesis at the closing
date.
Periodically and at a minimum at the annual closing period,
Dassault Systèmes SE reviews the net realizable value of
its investments and loans and advances to subsidiaries. In
particular, the net realizable value of securities takes into
account the amount of shareholders’ equity, long-term
profi tability and strategic factors. An impairment loss is
recognized if the net realizable value is less than the carrying
value for a long period of time.
Marketable Securities
Marketable securities are initially recorded at cost and are
depreciated, when applicable, by referring to their quoted
price in an active market at year end.
Receivables and payables
Trade receivables are reported at their net receivable value and
trade payables are reported at their nominal value. For trade
receivables, an allowance is recorded when the net realizable
value is lower than the carrying value taking into account, in
particular, aging and risk of non-collectability.
Foreign currency transactions
Transactions in foreign currencies are recorded in euros in
the income statement at the monthly average exchange
rate. Receivables, payables and cash in foreign currencies are
converted to euros in the balance sheet at the closing exchange
rate or at the hedged rate when they are subject to exchange
rate hedging. The conversion differences are recorded on
the balance sheet in “Unrealized Exchange Losses/Gains”. In
the event of unrealized losses, a provision for contingencies
(exchange loss) is recorded.
However, the current accounts used for the Group cash pooling
and the cash and cash equivalents (except for marketable
securities) are reevaluated at the closing rate and generate
exchange gains or
income
losses recorded
(expense), net. This impact is shown in foreign exchange gains
or losses, net.
in fi nancial
Derivatives
Dassault Systèmes SE can manage exposure to foreign
currency and interest rates with regards to revenue and cost
generated by its ongoing and predictable activity.
Dassault Systèmes SE can also mitigate a given foreign
currency exposure linked to specifi c operations, such as an
acquisition in foreign currency. In order to mitigate foreign
currency exposure, Dassault Systèmes SE uses, as needed,
only foreign exchange contracts or fi nancial instruments for
which total maximum losses are known from the outset.
Interest rate derivatives:
Financial income and expense resulting from the use of
derivatives are recorded in the income statement in the same
manner as income and expense from the covered transactions
when the derivatives are considered to be hedging transactions
from an accounting perspective. If the instruments do not
qualify as hedging, they are accounted for as follows:
(cid:125) net unrealized losses are fully reserved;
(cid:125) net gains are recognized in the income statement upon
settlement.
Exchange rate derivatives:
Exchange rate derivatives are included in Dassault Systèmes SE’s
currency position. Unrealized losses on these derivatives are
taken into account in determining the provision for unrealized
exchange losses.
Tax credit in favor of competitiveness and
employment (CICE)
Dassault Systèmes SE recognizes the tax credit in favor of
competitiveness and employment (the Crédit d’impôt pour
la compétitivité et l’emploi, or CICE) as an offset to personnel
costs.
130 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Notes on the Income Statement
Note 3 Revenue Breakdown
(in thousands of euros)
New licenses revenue
Periodic licenses and maintenance revenue
Royalties
TOTAL SOFTWARE REVENUE
Services
Other revenue
TOTAL REVENUE
The breakdown of software revenue by geographic area is as follows:
(in thousands of euros)
Europe
Asia
Americas
TOTAL SOFTWARE REVENUE
Note 4 Personnel Costs
Personnel costs are comprised of the following:
(in thousands of euros)
Salaries and wages
Social security costs
TOTAL PERSONNEL COSTS
Average Headcount by Category
Salaried employees by category
Managers
Supervisors and technicians
Employees
TOTAL AVERAGE HEADCOUNT (IN FULL TIME EQUIVALENTS)
Financial Statements
Parent Company Financial Statements
4
4
12/31/2015
12/31/2014
100,889
307,068
594,639
1,002,596
22,399
235,851
92,639
286,229
507,501
886,369
23,106
216,212
1,260,846
1,125,687
12/31/2015
12/31/2014
559,778
271,388
171,430
1,002,596
531,520
228,404
126,445
886,369
12/31/2015
12/31/2014
229,016
111,452
340,468
203,667
99,949
303,616
12/31/2015
12/31/2014
2,716
107
202
3,025
2,478
94
176
2,748
The merger operations (transmissions universelles de patrimoine) carried out in 2015 increased the headcount of
Dassault Systèmes SE by 37 employees.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
131
4 Financial Statements
Parent Company Financial Statements
Tax credit in favor of competitiveness and employment (CICE)
The tax credit in favor of competitiveness and employment (the Crédit d’impôt pour la compétitivité et l’emploi, or CICE) is based
on total compensation due for the current period. In 2015, an amount of €1.7 million of CICE was recognized (compared to
€1.6 million in 2014), and was allocated to funding working capital requirements.
Compensation of Executives
The total gross compensation paid to executive offi cers by Dassault Systèmes SE during 2015 was as follows:
(in thousands of euros)
Salaries
Benefi ts
Directors’ fees*
TOTAL COMPENSATION OF EXECUTIVES
*
Compensation is based on payments made. 2015 directors’ fees represent €71,000 paid in 2016.
12/31/2015
12/31/2014
4,308
3,909
21
69
21
57
4,398
3,987
Note 5 Financial Income and Expense, Net
Net fi nancial income and expense is as follows:
(in thousands of euros)
Interest income
Interest expense
INTEREST INCOME AND EXPENSE, NET
REVENUE FROM DISPOSALS OF INVESTMENT SECURITIES
NET FOREIGN EXCHANGE INCOME (EXPENSE), NET PROVISIONS FOR IMPAIRMENT
FINANCIAL INCOME AND EXPENSE, NET
12/31/2015
12/31/2014
63,105
(8,457)
54,648
16,821
3,411
74,880
30,415
(6,444)
23,971
19,972
(13,776)
30,167
Interest income is comprised primarily of dividends paid by Group subsidiaries for an amount of €48.9 million in 2015 compared
to €19.3 million in 2014 as well as from income from treasury investments.
132 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Parent Company Financial Statements
4
Note 6 Exceptional Income/Loss
Exceptional income for the year ended December 31, 2015 was €33.4 million compared to a loss of €22.8 million for the year
ended December 31, 2014. The change was primarily due to the recognition of a net capital gain on the sale of previously held
investments.
Note 7
Income Tax
The tax group included 11 entities at the end of December 2015.
Under the tax integration agreement, it is agreed that the
income tax expense of tax-integrated companies will be the
same as it would have been if each subsidiary had not been a
member of the Group. Without the tax integration agreements,
the income tax expense of Dassault Systèmes SE, the head of
the tax group, would have been €80.6 million in 2015.
The breakdown of income tax between current income and exceptional income for the year ended December 31, 2015, was as
follows:
4
(in thousands of euros)
Current income
Exceptional income
TOTAL
Income
before tax
Tax (expense)
credit
Income after
income tax
384,482
(8,877)
375,605
(93,954)
17,821
(76,133)
290,528
8,944
299,472
The effective income tax rate for the year ended December 31, 2015 was 20.3% against 19.8% in 2014.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
133
4 Financial Statements
Parent Company Financial Statements
Note 8 Performance Shares
Pursuant to an authorization granted by the Extraordinary General Meeting held on September 4, 2015, the Board of Directors
of Dassault Systèmes SE, meeting on the same day, decided to grant 734,600 performance shares to certain employees and
executives and 300,000 shares to the Chief Executive Offi cer in respect of the gradual process of associating the Chief Executive
Offi cer with the Company share capital.
The main characteristics of the performance share plans impacting 2014 and 2015 accounts are shown in the table below:
Plan
2010-02
2010-04
2010-05
2014-A
2014-B
2015-A
2015-B
Date of General Meeting
05/27/2010
05/27/2010
05/27/2010
05/30/2013
05/30/2013
09/04/2015
09/04/2015
Date granted by the Board
of Directors
Total number of shares
granted
Restated total number
of shares granted(1)
Vesting period (in years)(3)
09/29/2011
09/07/2012
09/07/2012
02/21/2014
02/21/2014
09/04/2015
09/04/2015
406,400
539,230
150,000
529,940
150,000
734,600
300,000
812,800(2)
1,078,460(2)
300,000
1,059,880
300,000
734,600
300,000
Three or
four (4)
Three or
four (4)
Two
Four
Four
Two
Two
Performance conditions
See note(5)
See note(5)
See note(6)
See note(7)
See note(7)
See note(7)
See note(7)
Performance conditions
is reached at
December 31 , 2015
Yes
Yes
Yes
N/A
N/A
N/A
N/A
(1) For shares granted before July 17, 2014, total number of shares granted has been restated to reflect the two-for-one stock split effected on July 17, 2014.
(2) Including 28,000 shares granted to the Chief Executive Officer (“CEO”), subject to an additional performance condition related to the CEO’s variable compensation.
(3 ) The shares will be fully vested provided that the beneficiary is still in the Company’s employment or a Director on the vesting date.
(4 ) Three years in France and four years abroad.
(5 ) Non-market performance conditions based on non-IFRS diluted earnings per share of the Group realized compared to the upper limit of the non-IFRS diluted earnings per share
objective during three years (2011, 2012 and 2013 for 2010-02 Shares, and 2012, 2013 and 2014 for 2010-04 Shares). The shares granted to the CEO are also subject to an
additional performance condition related to variable compensation dependent on achieving performance criteria previously established by the Board of Directors.
(6 ) Performance condition related to the CEO’s variable compensation dependent on achieving performance criteria previously established by the Board of Directors.
(7 ) Performance condition measured based on two alternative criteria, the growth of the non-IFRS diluted earnings per share of the Group or the outperformance of the price of the
Dassault Systèmes share compared to the performance of the CAC 40 index (market condition) for each of the years 2015, 2016 and 2017 for 2014-A and 2014-B Shares, and
for the year 2016 for 2015-A and 2015-B Shares, compared to the year 2014. Such growth or difference must be at least equal to a threshold established by the Board of Directors.
The 2015-B Shares granted to the CEO are also subject to an additional performance condition related to variable compensation dependent on achieving performance criteria
previously established by the Board of Directors.
The expense related to performance shares plans, for personnel of subsidiaries of Dassault Systèmes SE is recharged when the
shares are defi nitively attributed to benefi ciaries. During the vesting period, Dassault Systèmes SE accrues only for the costs
related to the performance shares attributed to employees contributing directly to its activity.
Note 9 Additional Information
Research and Development Expenses
In 2015, Dassault Systèmes SE recorded a total of €225.8 million of research and development expenses, which corresponds to
22.5% of software revenue.
134 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Parent Company Financial Statements
4
Statutory Auditors’ Fees
The amount of Statutory Auditors’ fees recorded in the income statement for the year is as follows:
(in thousands of euros)
Certifi cation of the individual and consolidated fi nancial statements
Other services
TOTAL STATUTORY AUDITORS’ FEES
12/31/2015
12/31/2014
1,242
54
1,296
1,293
561
1,854
Notes to the Balance Sheet
Note 10 Intangible Assets
(in thousands of euros)
Goodwill
Patents, licenses and trademarks
TOTAL GROSS VALUE
Goodwill
Patents, licenses and trademarks
TOTAL AMORTIZATION AND PROVISIONS
Goodwill
Patents, licenses and trademarks
TOTAL NET VALUE
4
12/31/2014
2015 additions
2015 disposals
12/31/2015
302,484
102,234
404,718
(20,227)
(72,017)
(92,244)
282,257
30,217
312,474
25,003
8,064
33,067
(16,961)
(10,735)
(27,696)
8,042
(2,671)
5,371
–
–
–
–
–
–
–
–
–
327,487
110,298
437,785
(37,188)
(82,752)
(119,940)
290,299
27,546
317,845
The increase in goodwill derives from merger operations (transmissions universelles de patrimoine) in 2015 (see Note 1 Description
of Business and Key Events of the Year).
Note 11 Property and Equipment
(in thousands of euros)
Machinery and equipment
Fixtures and fi ttings
Offi ce furniture and equipment
TOTAL GROSS VALUE
Machinery and equipment
Fixtures and fi ttings
Offi ce furniture and equipment
TOTAL DEPRECIATION
Machinery and equipment
Fixtures and fi ttings
Offi ce furniture and equipment
TOTAL NET VALUE
12/31/2014
2015 additions
2015 disposals
12/31/2015
68,304
26,823
16,156
111,283
(52,327)
(11,461)
(9,883)
(73,671)
15,977
15,362
6,273
37,612
10,840
(4,191)
501
473
11,814
(9,779)
(1,937)
(997)
(12,713)
1,061
(1,436)
(524)
(899)
(104)
(915)
(5,210)
4,141
63
87
4,291
(50)
(41)
(828)
(919)
74,953
27,220
15,714
117,887
(57,965)
(13,335)
(10,793)
(82,093)
16,988
13,885
4,921
35,794
DASSAULT SYSTÈMES ANNUAL REPORT 2015
135
4 Financial Statements
Parent Company Financial Statements
Note 12 Non-Current Financial Assets
(in thousands of euros)
Investments in subsidiaries
Loans and advances to subsidiaries
Treasury Shares
TOTAL GROSS VALUE
Provision for impairment
TOTAL PROVISION FOR IMPAIRMENT
Investments in subsidiaries
Loans and advances to subsidiaries
Treasury Shares
TOTAL NET VALUE
12/31/2014
2015 additions
2015 disposals
12/31/2015
1,725,797
402,412
516,194
77,703
2,319,694
(117,635)
(117,635)
1,608,162
516,194
77,703
43,128
3,758
449,298
(34,500)
(34,500)
367,912
43,128
3,758
(254,959)
(268,597)
(77,703)
1,873,250
290,725
3,758
(601,259)
2,167,733
43,700
43,700
(211,259)
(268,597)
(77,703)
(108,435)
(108,435)
1,764,815
290,725
3,758
2,202,059
414,798
(557,559)
2,059,298
The increase in investments in subsidiaries mainly relates
to the recapitalization of Dassault Systemes UK Limited and
the acquisition of the securities of French subsidiaries of the
Group. Moreover, the decrease in investments in subsidiaries
refl ects the sale of securities as well as the cancellation of the
securities of the merged companies (see Note 1 Description of
Business and Key Events of the Year).
Note 13 Receivables
Receivables are as follows:
(in thousands of euros)
TRADE ACCOUNTS RECEIVABLE, NET
Trade accounts receivable and related items
Allowance for trade accounts receivable
OTHER CURRENT ASSETS
Current accounts receivable*
Income tax receivable
Intercompany credit notes
Value added tax
Foreign currency hedges
Capital transactions
Other
TOTAL RECEIVABLES
*
See Note 18 Elements Concerning Related Companies.
Less than 1 year
Due dates
over one year
12/31/2015
12/31/2014
116,295
137,383
(21,088)
335,972
231,479
92,080
84
10,346
–
134
1,849
452,267
–
–
–
8,532
–
–
–
–
8,532
–
–
116,295
137,383
(21,088)
344,504
231,479
92,080
84
10,346
8,532
134
1,849
116,453
138,723
(22,270)
175,471
83,321
69,595
84
13,168
3,939
531
4,833
8,532
460,799
291,924
The €168.9 million increase in receivable mainly results from the increase of the current accounts receivable, in line with the
Group activity.
136 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Parent Company Financial Statements
4
The increase in marketable securities is principally attributable
to the new loan facility (see Note 17 Financial liabilities), as
well as the cash generated by the operations of the Group.
An amount of €2,028.4 million of marketable securities are
held in monetary investments.
4
Number
of shares
authorized
and issued
4,267,010
(773,550)
420,063
50,988
(1,604,620)
2,359,891
Average price
(in euros)
Total
(in thousands
of euros)
43.84
37.17
62.36
73.70
48.42
46.86
187,085
(28,756)
26,196
3,758
(77,703)
110,580
Note 14 Treasury
Marketable Securities
At December 31, 2015, marketable securities amounted
to €2,029.4 million compared with €947.4 million at
December 31, 2014. Marketable securities, invested in Euros,
are also sourced by the Group multiple currency central cash
pool for which the American dollars represented 22.5% at
December 31, 2015.
Treasury Shares
Share repurchases are analyzed below in 2015:
TREASURY SHARES AS OF JANUARY 1, 2015
Vesting of shares
Repurchase of treasury shares (1)
Repurchase of treasury shares through liquidity agreement
Cancellation of shares (2)
TREASURY SHARES AS OF DECEMBER 31, 2015
(1) The Combined General Meetings of Shareholders authorized the Board of Directors to implement a share repurchase program not to exceed 10% of Dassault Systèmes SE’s share
capital. In addition, Dassault Systèmes SE is authorized to purchase shares at a price not exceeding €90 per share and that the aggregate amount may not exceed €500 million.
(2) Decision by General Shareholder Meeting on March 20, 2015.
Note 15 Shareholders’ Equity
Share Capital
Changes in share capital during the year ended December 31, 2015 were as follows:
SHARES AS OF JANUARY 1, 2015
Shares issued pursuant to exercise of share subscription options
Capital increase (1)
Capital reduction(2)
SHARES AS OF DECEMBER 31, 2015
(1) See “Dividend rights” below.
(2) Capital reduction due to the cancellation of securities as decided by the Board of Directors held on March 20, 2015.
Number
of shares
authorized
and issued
256,364,077
1,769,020
185,709
(1,604,620)
256,714,186
Par value
(in euros)
Capital
(in euros)
0.50
0.50
0.50
0.50
0.50
128,182,039
884,510
92,854
(802,310)
128,357,093
DASSAULT SYSTÈMES ANNUAL REPORT 2015
137
4 Financial Statements
Parent Company Financial Statements
Shareholder base
On December 31, the share capital of Dassault Systèmes SE was held by:
(%)
Public
Groupe Industriel Marcel Dassault
Charles Edelstenne and benefi ciaries (1)
Bernard Charlès
Treasury shares(3)
TOTAL
On December 31, the voting rights in Dassault Systèmes SE were held by:
(in % of exercisable voting rights) (2)
Groupe Industriel Marcel Dassault
Public
Charles Edelstenne and benefi ciaries (1)
Bernard Charlès
TOTAL
2015
50.5
41.2
6.1
1.1
1.1
100
2015
55.5
34.9
8.2
1.4
100
2014
49.8
41.1
6.1
1.1
1.9
100
2014
55.7
34.7
8.3
1.3
100
(1) At December 31, 2015, Mr. Edelstenne held 4,001,806 shares with all ownership rights and 3,318 shares through two family companies which he manages, representing a total
of 1.56% of the capital and 2.08% of the exercisable voting rights, as well as 11,613 ,3 82 shares with “usage” rights (usufruit). For the usage rights with respect to these
11,613 ,3 82 shares, representing 6.12% of the exercisable voting rights, Mr. Edelstenne can only exercise the right to vote on decisions of the General Meeting concerning the
allocation of profits; the holders of the bare property rights (nue-propriété) exercise the right to vote for other resolutions in compliance with Article 11 of the by-laws.
(2) The total number of exercisable voting rights in the table above is the net number of voting rights (which does not include shares for which voting rights are suspended), or the
number of votes which may be exercised in a General Meeting.
(3) Including 50,988 shares held through the liquidity contract.
Stock Option Plans
A summary of stock option activity is as follows:
(in euros)
OUTSTANDING AS OF JANUARY 1,
Number of options granted
Exercised
Forfeited
OUTSTANDING AS OF DECEMBER 31,
Exercisable
2015
2014
Number
of shares
authorized
and issued
5,287,411
1,965,555
(1,769,020)
(171,850)
5,312,096
2,906,841
Average price
23.73
62.00
19.91
47.57
38.40
21.50
Number
of shares
authorized
and issued
7,094,974
624,450
(2,375,837)
(56,176)
5,287,411
4,677,561
Average price
21.06
45.50
21.32
29.22
23.73
20.90
A summary of the remaining contractual life and the exercise price of options outstanding as of December 31, 2015 is presented
below:
SOP plan
2008-02
2010-01
2014 -01
2015 -01
OUTSTANDING AS OF DECEMBER 31, 2015
138 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Total of shares
Remaining life
(years)
Exercise price
1,455,264
1,451,577
463,850
1,941,405
5,312,096
1.91
2.40
6.40
9.68
5.28
19.50
23.50
45.50
62.00
38.40
Financial Statements
Parent Company Financial Statements
4
Movements in Shareholders’ Equity
Movements in shareholders’ equity for the year ended December 31, 2015 were as follows:
(in thousands of euros)
Share Capital
Share and contribution premiums
Legal reserve
Retained earnings
Income (loss) for the fi scal year
Regulated provisions
12/31/2014
Appropriation of
2014 earnings
128,182
755,799
12,693
1,710,502
183,005
12,493
93
12,801
125
74,345
(183,005)
-
Effect of
exercising
options
884
34,340
-
-
-
-
Net income for
2015 fi scal year
-
-
-
-
299,472
Other
(802)
(76,901)
-
-
-
-
(9,307)
12/31/2015
128,357
726,039
12,818
1,784,847
299,472
3,186
SHAREHOLDERS’ EQUITY
2,802,674
(95,641)
35,224
299,472
(87,010)
2,954,719
Dividend rights
The Combined General Meeting of Shareholders held on
May 28, 2015 approved a dividend of €108.5 million,
based on the existing shares as at February 28, 2015. The
General Meeting approved offering shareholders the option
to receive payment of their dividend for 2014 in the form of
new Dassault Systèmes SE shares. As a result, 185,709 new
ordinary shares were created. The cash dividend was paid in
the total amount of €95.6 million.
4
Note 16 Provisions for Contingencies and Losses
Movements of provisions for contingencies and losses were as follows:
(in thousands of euros)
Provisions for performance shares
Provisions for exchange losses
Provisions for post-employment benefi ts
Other provisions for contingencies and losses
Provisions for jubilee awards
TOTAL PROVISIONS
12/31/2014
Additions
Utilization
Reversal of
unused amounts
12/31/2015
30,919
20,427
18,152
3,767
4,854
78,119
24,514
25,633
3,535
1,717
393
(26,450)
(20,430)
–
(2,689)
(10)
–
–
(2,994)
(440)
–
55,792
(49,579)
(3,434)
28,983
25,630
18,693
2,355
5,237
80,898
Changes in provisions for contingencies and losses impacted captions of the income statement as follows:
(in thousands of euros)
Operating income
Financial income and expense, net
Exceptional income/(loss)
TOTAL
Additions
Utilization
24,340
25,633
5,819
55,792
(28,686)
(20,430)
(463)
(49,579)
Reversal of
unused amounts
(3,434)
–
–
(3,434)
Provisions for Post-employment Benefits
Dassault Systèmes SE’s commitment in terms of post-
employment benefi ts was evaluated and recognized using the
prospective actuarial future rights pro-rata method with the
use of a corridor.
This method takes into account rights acquired by employees
on the date of their retirement, computed on the basis of
the employees’ seniority and annual salary at the time of
retirement. These rights are acquired and paid to employees
when they retire as a fi xed amount.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
139
4 Financial Statements
Parent Company Financial Statements
The projected benefi t obligation at December 31, 2015 was
determined based on the following assumptions: retirement
between 60 and 65 years of age, discount rate of 2.10%,
average increase in salaries of 2.80% and a 2.10% expected
return on plan. Dassault Systèmes SE has an insurance policy
with Sogecap, a life insurance company affi liated with the
Société Générale, intended to cover the retirement payment
commitments. Pursuant to this policy, Dassault Systèmes SE
has invested a total of €11.1 million, including €3.0 million
paid in 2015. Actuarial gains and losses and the cost of past
service is spread in profi t using the corridor method. They
totaled €10.7 million to be spread over an average residual
employee service of 22 years.
Note 17 Financial Liabilities
Financial liabilities are as follows:
(in thousands of euros)
Bank loans and borrowings
Mandatory employee profi t-sharing scheme
Other fi nancial liabilities
TOTAL FINANCIAL LIABILITIES
Less than
1 year
1,321
3,135
19
1 to
5 years
12/31/2015
12/31/2014
1,000,000
1,001,321
351,888
15,357
7,829
18,492
7,848
20,339
4,735
4,475
1,023,186
1,027,661
376,962
In October 2015, Dassault Systèmes SE entered into a new term loan facility agreement for €650 million (See Note 1 Description
of Business and Key Events of the Year).
Note 18 Elements Concerning Related Companies
(in thousands of euros)
Loans receivable
Trade accounts receivable and related items
Current accounts receivable
Accounts payable and related items
Other operating liabilities
Current accounts with credit balances
Finance income: dividends collected and net interest received
12/31/2015
12/31/2014
290,315
41,634
231,479
1,603
–
757,806
61,324
514,616
30,581
83,322
2,231
–
453,637
30,384
140 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Parent Company Financial Statements
4
Less than
1 year
58,507
1,603
56,904
125,842
23,177
40,068
53,175
9,422
760,506
757,806
2,700
944,855
1 to
5 years
–
–
–
10,582
10,582
–
–
–
–
–
–
10,582
12/31/2015
12/31/2014
58,507
1,603
56,904
69,606
2,231
67,375
136,424
118,984
33,759
40,068
53,175
9,422
760,506
757,806
2,700
955,437
27,696
36,826
44,970
9,492
459,860
453,637
6,223
648,450
4
Note 19 Trade Payables
Trade payables are as follows:
(in thousands of euros)
ACCOUNTS PAYABLE AND RELATED ITEMS
Group trade payables
Third-party trade payables
TAX AND SOCIAL SECURITY PAYABLES
Mandatory and contractual profi t-sharing
Accrued vacation
Other employee expenses
Value added tax and other taxes and duties
OTHER OPERATING LIABILITIES
Current accounts payable*
Other liabilities
TOTAL PAYABLES
*
See Note 18 Elements Concerning Related Companies.
In accordance with articles L. 441-6 and D. 441-4 of the French Commercial Code related to information regarding payment due
dates, at December 31, 2015, the balance of Dassault Systèmes SE’s trade payables to its suppliers amounted to €11.6 million
(2014: €19.3 million). Due dates are as follows:
Due within 30 days
Due in more than 30 days
TOTAL
Note 20 Unearned Revenue
12/31/2015
12/31/2014
58.5%
41.5%
100.0%
49.9%
50 .1%
100.0%
Unearned revenue is composed primarily of deferred software, maintenance and support revenue relating to periods subsequent
to year end. Unearned revenue amounted to €42.9 million in 2015 compared to €40.4 million in 2014.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
141
4 Financial Statements
Parent Company Financial Statements
Note 21 Financial Commitments
Financial Instruments
At December 31, 2015 and 2014, the fair value of instruments used to manage currency and interest rate exposure was as
follows:
(in thousands of euros)
Interest rate swaps in euros(1)
Interest rate swaps in Japanese yen(2)
Interest rate swaps in Japanese yen(2)
Forward exchange contract Japanese yen/euros – sale(3)
Cross currency swaps Canadian dollars/euros(4)
Cross currency swaps Australian dollars/euros(4)
Forward exchange contract euros/U.S. dollars – sale(2)
Forward exchange contract euros/U.S. dollars – sale(2)
Forward exchange contract Japanese yen/U.S. dollars – sale(2)
Forward exchange contract Japanese yen/U.S. dollars – sale(2)
Other instruments(5)
Year ended December 31,
2015
Nominal
amount
Fair
value
1,000,000
(13,426)
–
–
133,832
61,683
71,735
36,741
36,741
–
–
21,853
–
–
(792)
6,449
2,082
(666)
666
–
–
(73)
2014
Nominal
amount
350,000
9,984
9,984
38,163
73,412
72,064
–
–
5,507
5,507
37,789
Fair
value
(12,145)
(15)
15
2,438
1,863
1,548
–
–
946
(946)
(297)
(1) Term loan facilities obtained by Dassault Systèmes SE in June 2013 and October 2015 respectively for €350 million and €650 million (see Note 1 Description of Business and Key
Events of the Year and Note 17 Financial liabilities)
(2) Dassault Systèmes SE has entered into hedging agreements for its subsidiaries.
(3) Instruments entered into by the Company to hedge the foreign currency exchange risk of forecasted sales.
(4) Hedging contracts with regards to loans made to subsidiaries to finance acquisitions; these instruments are not designated as hedging instruments.
(5) Derivatives not designated as hedging instruments.
The fair market values of derivative
instruments were
determined by fi nancial institutions using option pricing
models.
At the end of 2015, foreign exchange contracts have maturity
dates of less than 12 months. Swaps of cross currency and
interest rates have respectively a maturity less than three and
fi ve years.
Increases and Reductions in Future Income Tax
Payable
Increases and reductions in future income tax payable have
been evaluated on the basis of the standard corporate tax rate,
plus extraordinary contributions when applicable.
(in thousands of euros)
Nature of temporary differences
SHORT TERM
Provision for mandatory profi t-sharing
Depreciation of receivables
Provisions for Contingencies and losses
Other
LONG TERM (34.43% TAX RATE)
Provision for post-employment benefi ts
TOTAL TEMPORARY DIFFERENCES
Net reduction of the future corporate tax debt
(38.00% tax rate)
(34.43% tax rate)
142 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
12/31/2015
12/31/2014
42,553
21,163
21,088
–
302
18,692
18,692
61,245
–
21,087
43,030
17,921
22,270
2,537
302
18,151
18,151
61,181
16,351
6,249
Financial Statements
Parent Company Financial Statements
4
Note 22 Other Commitments and Contingencies
Leases
On December 31, 2015, commitments stood at €272.6 million
for real estate and equipment rentals including: €253.2 million
relating to the lease for the headquarters in Vélizy-Villacoublay
(compared with €273.1 million as of December 31, 2014);
and €8.6 million (compared with €10.9 million as of
December 31, 2014) related to the lease of the “Terre Europa”
site, next to the headquarters, effective as from July 2011.
In February 2013, Dassault Systèmes SE committed to lease
an additional 13,000 square meters of offi ce space and to
enter into a new lease for its headquarters facilities for a non-
cancelable initial term of ten years which will take effect when
construction is completed that is expected end of 2016.
Litigation and other proceedings
Dassault Systèmes SE is involved in litigation and other
proceedings, such as civil, commercial and tax proceedings,
incidental to normal operations. Dassault Systèmes SE is
subject to ongoing tax audits and tax reassessments. Certain of
these reassessments, in particular those related to acquisition
fi nancing, are being challenged by Dassault Systèmes SE,
which is strongly confi dent in the technical merits of its
positions and will continue to defend them with the relevant
tax authorities. In this context, Dassault Systèmes SE made
payments to the French tax authorities for €57.7 million and
€22.2 million in 2015 and 2014 respectively but disputed
them with the relevant authorities.
It is not possible to determine with certainty the outcome
of the dispute in these matters. However, in the opinion of
management, after consultation with legal and tax counsel,
the resolution of such litigation and proceedings should
not have a material effect on the fi nancial statements of
Dassault Systèmes SE.
Guarantee pledged
The Group has a central cash management operated by a
banking institution. In this context, the parent company of
the bank offered a guarantee to the Group in the amount of
€459 million, and at the same time Dassault Systèmes SE
offered a guarantee to the bank for the same amount.
4
Note 23 Additional Information
Events after the reporting period
Identity of the Consolidating Company
None.
Dassault Systèmes SE’s business is included in the consolidated
fi nancial statements of Groupe Industriel Marcel Dassault
SAS, whose registered offi ce is located at 9, Rond-Point des
Champs-Élysées – Marcel Dassault, 75008 Paris, France.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
143
4 Financial Statements
Parent Company Financial Statements
Note 24 Information Relating to Subsidiaries and Shareholdings
(in thousands
of euros)(1)
Location of
Headquarters
Dassault Systemes
Corp.(2)
Waltham –
USA
Dassault Systemes
UK Limited
Coventry –
UK
Dassault Systemes
Deutschland
GmbH
Dassault Systèmes
International SAS
Stuttgart –
Germany
Vélizy-
Villacoublay –
France
Dassault Systèmes
Israel Ltd
Kfar Saba –
Israel
Dassault Systemes
K.K.
Tokyo –
Japan
Dassault Systèmes
Canada Inc.
Montreal –
Canada
Dassault Systèmes
Provence SAS
Netvibes France
SAS
3DVIA SAS
Aix en
Provence –
France
Paris –
France
Paris –
France
Dassault Systemes
AB
Goteborg –
Sweden
Dassault Systemes
India Pvt Limited
Gurgaon –
India
Dassault Systèmes
Biovia SARL
Quintic SAS
Dassault Data
Services SAS
Vélizy-
Villacoublay –
France
Paris –
France
Vélizy-
Villacoublay –
France
Dassault Systemes
Italia Srl
Lainate –
Italy
Simpack France
SAS
Lyon –
France
Other foreign
subsidiaries
TOTAL
Gross book
value of
shares
Net book
value of
shares
% of
interest
Share
capital
and share
premiums
Reserves
and
retained
earnings
Net profi t
or loss Revenue
Dividend
rights
received
Loans and
advances
Guarantees
and
sureties
788,462
788,462
100
1,514,004
252,357
(42,077)
–
416,533
416,533
100
420,400
5,688
(7,699)
71,234
226,354
179,300
100
10,601
165,614
(34,637)
188,819
183,041
137,041
100
128,943
(224)
801
–
64,883
49,502
100
32,249
(24,918)
8,011
30,759
43,742
43,742
100
33,188
4,848
16,216
325,888
36,673
36,673
100
33,406
7,925
3,624
27,794
–
–
–
–
–
–
–
–
15,308
–
137,481
–
–
61,682
32,248
32,248
100
32,394
16,754
17,110
39,751
25,400
31,258
31,258
13,350
13,350
9,540
9,540
8,823
8,823
6,240
6,240
4,000
4,000
2,576
2,576
1,949
1,949
1,600
1,600
1,978
1,978
100
100
100
100
100
100
100
100
100
3,235
–
(3,117)
2,010
873
(1,820)
(6,865)
2,217
11
5,247
894
46,334
4,398
7,115
1,623
45,348
152
1,624
35
4,816
1
–
(852)
5,979
–
–
–
–
–
–
3,000
2,300
3,405
52,166
5,200
20
37
886
499
172
35,491
13
694
Not
disclosed
–
–
1,378
–
–
–
–
–
–
–
–
–
–
–
1,873,250 1,764,815
2,216,912
443,895 (43,343)
879,300
31,978
214,471
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
(1) The earnings of foreign subsidiaries are in general presented in local GAAP for the year 2014. The results and revenue have been converted using the 2015 average annual
exchange rates for the relevant currencies, while the shareholders’ equity of foreign subsidiaries have been converted using the closing rates in effect at year-end 2015.
(2) American holding company owning 100% of Dassault Systemes SolidWorks Corp., and Dassault Systemes Holding LLC, the latter itself holding principally 100% of
Dassault Systemes Simulia Corp. and Dassault Systemes Americas Corp.
144 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Parent Company Financial Statements
4
4.2.2 Selected fi nancial and other information
for Dassault Systèmes SE over the last fi ve years
(in euros)
Share capital
Share Capital
2011
2012
2013
2014
2015
123,092,729
125,096,778
126,932,985
128,182,039
128,357,093
Number of shares authorized and issued (2)
123,092,729
125,096,778
126,932,985
256,364,077
256,714,186
Statement of income data
Revenue
Result before income tax, profi t sharing, amortization
and provisions
Result before income tax, profi t sharing, amortization
and provisions and reversals of provisions
Income tax
Regulated employee profi t-sharing
Optional employee profi t-sharing
Net income
Data per share
Result after income tax and profi t sharing
and before amortization and provisions
Basic net income per share
Dividend per share (2)
Personnel
Average headcount
850,023,294
990,705,543 1,064,558,462 1,125,687,175 1,260,845,593
415,780,289
386,581,931
435,033,094
359,636,561
533,131,911
341,652,678
367,577,134
413,314,821
304,131,981
447,874,625
46,812,886
52,457,635
68,216,039
45,164,304
76,133,045
13,192,985
16,266,653
15,512,132
17,921,044
21,163,228
14,165,501
13,601,995
18,421,890
17,921,044
21,163,228
264,795,422
254,846,867
263,440,594
183,005,154
299,471,749
4
2.17
2.15
0.70
2.28
2.04
0.80
2.45
2.08
0.83
0.87
0.71
0.43
1.28
1.17
0.47(1)
2,141
2,372
2,541
2,748
3,025
Personnel costs paid during the year
140,056,445
164,250,610
180,114,271
203,666,853
229,015,587
Social security contributions paid during the year
70,506,943
88,239,898
86,640,481
99,949,422
111,452,364
(1) To be proposed for approval at the General Meeting scheduled for May 26, 2016.
(2) Historical data prior to 2014 does not reflect the two-for-one stock split of Dassault Systèmes SE shares carried out on July 17, 2014.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
145
4 Financial Statements
Parent Company Financial Statements
4.2.3
Statutory Auditors' Report on the Parent Company Financial
Statements
This is a free translation into English of the Statutory Auditors’ report on the fi nancial statements issued in French and it is
provided solely for the convenience of English-speaking users.
The Statutory Auditors’ report includes information specifi cally required by French law in such reports, whether modifi ed or not.
This information is presented below the audit opinion on the fi nancial statements and includes an explanatory paragraph discussing
the auditors’ assessments of certain signifi cant accounting and auditing matters. These assessments were considered for the
purpose of issuing an audit opinion on the fi nancial statements taken as a whole and not to provide separate assurance on
individual account balances, transactions or disclosures.
This report also includes information relating to the specifi c verifi cation of information given in the management report and in the
documents addressed to the shareholders.
This report should be read in conjunction with and construed in accordance with French law and professional auditing standards
applicable in France.
To the Shareholders,
In compliance with the assignment entrusted to us by your Shareholders’ Meetings, we hereby report to you, for the year ended
December 31, 2015, on:
(cid:125) the audit of the accompanying fi nancial statements of Dassault Systèmes;
(cid:125) the justifi cation of our assessments;
(cid:125) the specifi c verifi cations and information required by law.
These fi nancial statements have been approved by the Board of Directors. Our role is to express an opinion on these fi nancial
statements based on our audit.
I. Opinion on the fi nancial statements
We conducted our audit in accordance with professional standards applicable in France; those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the fi nancial statements are free of material misstatement. An
audit involves performing procedures, using sampling techniques or other methods of selection, to obtain audit evidence about the
amounts and disclosures in the fi nancial statements. An audit also includes evaluating the appropriateness of accounting policies
used and the reasonableness of accounting estimates made, as well as the overall presentation of the fi nancial statements. We
believe that the audit evidence we have obtained is suffi cient and appropriate to provide a basis for our audit opinion.
In our opinion, the fi nancial statements give a true and fair view of the assets and liabilities and of the fi nancial position of
the Company as at December 31, 2015 and of the results of its operations for the year then ended in accordance with French
accounting principles.
II. Justifi cation of our assessments
In accordance with the requirements of A rticle L. 823-9 of the French Commercial Code (Code de commerce) relating to the
justifi cation of our assessments, we bring to your attention the following matters:
(cid:125) The paragraph "Revenue" of the Note 2 to the fi nancial statements sets out the accounting principles and methods used to
account for revenue including fi rstly new software licenses along with the related maintenance, and secondly services and
other revenue. We verifi ed the appropriateness of the retained accounting principles and methods, their application and the
information disclosed in the notes;
(cid:125) The paragraph "Intangible Assets, Property and Equipment" of the Note 2 to the fi nancial statements summarizes the methods
of recognition and valuation of intangible assets. We verifi ed that the values in use of the business assets (" fonds de commerce")
were consistent with their carrying value;
(cid:125) The paragraph "Non-current Financial Assets" of the Note 2 to the fi nancial statements summarizes the methods of recognition
and valuation of fi nancial fi xed assets. We verifi ed that the values in use of the long-term equity interests were consistent with
their carrying values.
These assessments were made as part of our audit of the fi nancial statements taken as a whole, and therefore contributed to the
opinion we formed which is expressed in the fi rst part of this report.
146 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Parent Company Financial Statements
4
III. Specifi c verifi cations and information
We have also performed, in accordance with professional standards applicable in France, the specifi c verifi cations required by
French law.
We have no matters to report as to the fair presentation and the consistency with the fi nancial statements of the information
given in the management report of the Board of Directors and in the documents addressed to shareholders with respect to the
fi nancial position and the fi nancial statements.
Concerning the information given in accordance with the requirements of article L. 225-102-1 of the French Commercial Code
(Code de commerce) relating to remunerations and benefi ts received by the directors and any other commitments made in their
favour, we have verifi ed its consistency with the fi nancial statements, or with the underlying information used to prepare these
fi nancial statements and, where applicable, with the information obtained by your Company from companies controlling your
Company or controlled by it. Based on this work, we attest the accuracy and fair presentation of this information.
In accordance with French law, we have verifi ed that the required information concerning the purchase of investments and
controlling interests and the identity of the shareholders and holders of voting rights has been properly disclosed in the
management report.
Neuilly-sur-Seine and Paris-La Défense, on March 18 , 2016
The Statutory Auditors
P ricewaterhouseC oopers A udit
French original signed by:
Pierre Marty
ERNST & YOUNG et A utres
French original signed by:
Pierre-Antoine Duffaud
4
DASSAULT SYSTÈMES ANNUAL REPORT 2015
147
4 Financial Statements
Parent Company Financial Statements
4.2.4
Statutory Auditors' Report on Related Party Agreements
and Commitments
This is a free translation into English of a report issued in French and it is provided solely for the convenience of English speaking
users. This report should be read in conjunction with, and construed in accordance with, French law and professional standards
applicable in France.
To the Shareholders,
In our capacity as statutory auditors of your company, we hereby report on certain related party agreements and commitments.
We are required to inform you, on the basis of the information provided to us, of the terms and conditions of those agreements
and commitments indicated to us, or that we may have identifi ed in the performance of our engagement. We are not required to
comment as to whether they are benefi cial or appropriate or to ascertain the existence of any such agreements and commitments.
It is your responsibility, in accordance with Article R. 225-31 of the French Commercial Code (Code de commerce), to evaluate the
benefi ts resulting from these agreements and commitments prior to their approval.
In addition, we are required, where applicable, to inform you in accordance with Article R. 225-31 of the French Commercial Code
(Code de commerce) concerning the implementation, during the last fi nancial year, of the agreements and commitments already
approved by the General Meeting of Shareholders.
We performed those procedures which we considered necessary to comply with professional guidance issued by the national
auditing body (Compagnie Nationale des Commissaires aux Comptes) relating to this type of engagement. These procedures
consisted in verifying that the information provided to us is consistent with the documentation from which it has been extracted.
Agreements and commitments submitted for approval by the General Meeting of Shareholders
We hereby inform you that we have not been advised of any agreements or commitments authorized in the course of the year to
be submitted to the General Meeting of Shareholders for approval in accordance with Article L.225-38 of the French commercial
code (Code de Commerce).
Agreements and commitments approved in prior years
We hereby inform you that we have not been advised of any agreements or commitments already approved by the General
Meeting of Shareholders, whose implementation continued during the year.
In addition, we have been advised that the following agreements and commitments which were approved by the General Meeting
of Shareholders in prior years were not implemented during the year.
1. With Mr Bernard Charlès, directeur général
Nature and purpose
Indemnity in the event of the removal of Mr Bernard Charlès from corporate offi ce
Conditions
At its meeting on 26 May 2014, on the occasion of the renewal of Mr Bernard Charlès’ term of offi ce as directeur général, the
Board of Directors authorized, upon the proposal of the Remuneration and Selection Committee, the renewal of the agreement
granting Mr Bernard Charlès a compensation in case of the termination of his functions as directeur general according to the terms
adopted by the Board of Directors at its meetings on27 May 2010, 28 March 2008 and 27 March 2009.
At its meeting on 26 May 2014, the Board of Directors decided to make no change to the conditions, as defi ned by the Board
of Directors at its meeting on 27 March 2009, in which this compensation would be due in view of the recommendations of
the Remuneration and Selection Committee and in accordance with the recommendations integrated into the AFEP/MEDEF
Consolidated Corporate Governance Code (Code de gouvernement d’entreprise consolidé) of December 2008.
The amount of the indemnity due would be equivalent to a maximum of two years of remuneration of the directeur général and
would depend on meeting performance targets established for the calculation of his variable remuneration.
The amount paid would be calculated as a prorated percentage of the variable remuneration paid during the three years prior to
the departure in relation to the target variable remuneration for these same years.
148 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Financial Statements
Parent Company Financial Statements
4
4
Thus, the amount due would be calculated according to the following formula:
(cid:125) total gross remuneration (including variable remuneration but excluding benefi ts in kind and directors’ fees) due in respect of
his corporate offi ce for the two years ended prior to the date of departure,
(cid:125) multiplied by the fi gure resulting from the division i) of the amount of the variable remuneration paid to the directeur général during
the three years ended prior to the date of the departure (numerator), by ii) the amount of the target variable remuneration decided for
each of these same years by the Board of Directors according to the achievement of the targets fi xed for the company (denominator).
The indemnity may only be paid in the event of a change of control or strategy duly established by the Board of Directors that
results in a forced departure within the following twelve months. It could also be paid in a scenario of a forced departure without
being related to poor results of the company or to mismanagement by the directeur général; the Board of Directors can then
decide to grant all or part of the termination compensation.
The indemnity will not be due in a situation where the directeur général leaves the company on his own initiative to take up a new
position, or changes position within the group, or if he is able to claim a pension within a short time period.
Besides, in the event of exceptional events that could seriously damage the group’s image or income and have a signifi cant
negative impact on the stock market share price of your company, according to the assessment of the Board of Directors, or in
the event of misconduct independent of his functions and incompatible with the normal performance of his offi ce as directeur
général, the Board of Directors may establish that the indemnity will not be due.
2. With the board members of your company, in connection with the insurance policy " Civil
liability of the directors and the corporate offi cers " signed with the company Insurance Allianz
a. Nature and purpose
Advance to the Board Members of their expenses of possible legal defense instituted against them in the exercise of their mandate
Conditions
In its meeting on 24 July 1996, the Board of Directors authorized the decision to have your company advance their expenses
to a legal and compensations that the board members might have if their personal civil liability would be questioned, in case
the insurance policy signed with the company CHARTIS Insurance (Allianz), would not cover these advances and fi nancial
consequences.
b. Nature and purpose
Payment of the possible legal defense expenses of Board Members taking place in the United Sates.
Conditions
In its meeting on 23 September 2003, the Board of Directors authorized the decision to have your company pay the fees and
travel expenses that board members of the company and of its subsidiaries might have to meet to prepare their personal defense
before a civil, criminal or administrative jurisdiction of the United States if this defense were to be exercised within the scope of
an inquiry or investigations being carried out against your company.
Payment of these expenses is ensured on the three-part condition that the board members and senior executives concerned are
assisted by lawyers selected by the company, that the company remains in control of its strategic choices in terms of procedure
and methods of defense and that the expenses incurred be reasonable.
Neuilly-Sur-Seine and Paris-La Défense, March 18th 2016
The Statutory Auditors
PricewaterhouseCoopers Audit
French original signed by:
Pierre Marty
ERNST & YOUNG et Autres
French original signed by:
Pierre-Antoine Duffaud
DASSAULT SYSTÈMES ANNUAL REPORT 2015
149
4 Financial Statements
Legal and Arbitration Proceedings
4.3 Legal and Arbitration Proceedings
In the ordinary course of business, the Company is involved
from time to time in litigation, tax audits or regulatory
inquiries. The Company is subject to ongoing tax audits and tax
reassessments in jurisdictions in which it has or had operations.
Certain reassessments have been contested and the Company
is under discussion with the relevant tax authorities. To the
Company’s knowledge, there is no outstanding, suspended
or pending government proceeding, litigation or arbitration,
which has had during the last twelve months preceding
the publication of this 2015 Annual Report (Document de
référence), or is likely to have, a signifi cant impact on the
Company’s fi nancial position or results of operations.
150 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
5
CORPORATE
GOVERNANCE
5.1 Report of the Chairman
on Corporate Governance
and Internal Control
5.2 Report of the Statutory Auditors
on Corporate Governance
and Internal Control
152
CONTENTS
5.1.1 Composition and Practices of the Board of Directors 152
5.1.2 The Executive Committee
5.1.3 Declarations Regarding the Administrative Bodies
and Senior Management
5.1.4 Principles Established by the Board of Directors
pertaining to Compensation of the Executive
Offi cers and Directors
5.1.5 Application of the AFEP-MEDEF Code
162
163
163
166
5.1.6 Internal Control Procedures and Risk Management 167
5.1.7 Other information required by Article L. 225-37
of the French Commercial Code
170
5.3 Summary of the Compensation
and Benefi ts Due to Corporate
Offi cers (mandataires sociaux)
5.3.1 Compensation of the Company’s Corporate
Offi cers (mandataires sociaux)
5.3.2 Interests of Executive Management and
Employees in the Share Capital of Dassault
Systèmes SE
5.4 Transactions in the Company’s
Shares by the Management
of the Company
5.5 Statutory Auditors
171
172
172
176
181
184
DASSAULT SYSTÈMES DOCUMENT DE RÉFÉRENCE 2015 151
5 Corporate governance
Report of the Chairman on Corporate Governance and Internal Control
5.1 Report of the Chairman on Corporate Governance
and Internal Control
Report of the Chairman of the Board of Directors
to the Combined General Meeting of May 26, 2016
To the Shareholders of Dassault Systèmes,
The purpose of this report is to describe the composition
and practices of the Board of Directors of Dassault Systèmes
SE, the application thereto of the principle of balanced
representation of men and women, and the internal control
and risk management procedures established by the Company.
This report was drawn up in accordance with the French
Commercial Code and the regulations of the Financial Markets
Authority (AMF), based on work carried out by the finance,
legal and internal audit departments of Dassault Systèmes. It
has been reviewed by the Audit Committee and approved by
the Board of Directors on March 17, 2016.
Since its IPO in 1996, Dassault Systèmes has sought to
implement the best international standards of corporate
governance. Dassault Systèmes currently adheres to most of
the recommendations of the AFEP-MEDEF Code (available on
the MEDEF website: www.medef.fr) and therefore summarizes
in a table the reasons why it does not apply certain of these
recommendations (see paragraph 5.1.5 “Application of the
AFEP-MEDEF Code”).
5.1.1 Composition and Practices of the Board of Directors
5.1.1.1
Composition of the Board of Directors
The Board of Directors of Dassault Systèmes SE has nine
members, who are elected for a term of office of four years:
(cid:125) Charles Edelstenne (Chairman);
(cid:125) Bernard Charlès;
(cid:125) Jean-Pierre Chahid-Nouraï;
(cid:125) Nicole Dassault;
(cid:125) Arnoud De Meyer;
(cid:125) Odile Desforges;
(cid:125) Marie-Hélène Habert;
(cid:125) Toshiko Mori; and
(cid:125) Thibault de Tersant.
With regard to the composition of its Board of Directors,
Dassault Systèmes SE pays particular attention
to
independence, diversity of background and the representation
of women.
At present, 44% of the directors of Dassault Systèmes SE
are independent: Odile Desforges, Toshiko Mori, Jean-Pierre
Chahid-Nouraï and Arnoud De Meyer. This proportion exceeds
the recommendation of the AFEP-MEDEF Code for controlled
companies.
Dassault Systèmes SE has incorporated the definition of
independence contained in the AFEP-MEDEF Code into
the internal regulation of the Board of Directors, whereby a
director is independent when he or she has no relationship
whatsoever with Dassault Systèmes SE, the Group, the
Company or its management which might compromise his/
her free judgment.
At its meeting on March 17, 2016, the Board of Directors
reviewed, as it does each year, the independence criteria for
these directors. This decision by the Board is based on the
recommendations of the Compensation and Nomination
Committee, after a review of the responses of each director
to a questionnaire, with regard to each of the independence
criteria recommended by the AFEP-MEDEF Code, particularly
with regard to the absence of a business relationship. As none
of the independent directors have a business relationship with
the Group, the Board of Directors had to express an opinion, as
at present, neither on the materiality of any such relationship
nor on the criteria used to assess it.
Dassault Systèmes SE also makes every effort to ensure that
the Board has a significant number of women members.
As 44% of its directors are women, Dassault Systèmes SE
currently exceeds the thresholds of 40% enshrined in law and
recommended by the AFEP-MEDEF Code.
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The Board does also have an international dimension, with
a Belgian and a Japanese director accounting for 22% of the
members.
The average age of the directors was 66 at the date of this
Annual Report (Document de référence).
The above information is summarized in the table below.
COMPOSITION OF THE BOARD OF DIRECTORS OF DASSAULT SYSTÈMES SE
Director
Charles Edelstenne
Bernard Charlès
Thibault de Tersant
Jean-Pierre Chahid-Nouraï
Nicole Dassault
Arnoud De Meyer
Odile Desforges
Marie-Hélène Habert(1)
Toshiko Mori
Independence
Start of first
term of office Term expires in
Changes in 2015
Contribution
to the diversity of the
Board’s composition
04/08/1993
04/08/1993
04/08/1993
04/15/2005
05/26/2011
2018
2018
2018
2019
2019
Re-appointment
Re-appointment
04/15/2005
2019
Re-appointment
05/30/2013
2017
07/23/2014
2016
Ratification(2)
05/26/2011
2019
Re-appointment
X
X
X
X
Enhanced female
representation
Enhanced
international
representation
Enhanced female
representation
Enhanced female
representation
Enhanced female
and international
representation
5
(1) The renewal of the term of office of this director is to be proposed to the General Meeting of May 26, 2016.
(2) The appointment of Marie-Hélène Habert, who was co-opted in 2014, was ratified by the General Meeting of May 28, 2015.
A resolution will be submitted to the General Meeting of May 26, 2016 to appoint a new director, Mrs.Laurence Lescourret and to
amend the by-laws to allow the appointment of a director representing the employees, the term of whom is scheduled to begin
during 2016. For more information, see paragraph 7.1 “Presentation of the Resolutions Proposed by the Board of Directors to
the General Meeting on May 26, 2016”.
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The roles and duties performed by the Dassault Systèmes SE corporate officers (mandataires sociaux) in 2015 are indicated in
the table below.
CHARLES EDELSTENNE – CHAIRMAN OF THE BOARD
Biography: Charles Edelstenne qualified as a Chartered
Accountant. He has spent his whole career with Dassault Aviation,
where he started working in 1960 as Head of the Financial
Studies department. In 1975 he became General Secretary then
Vice-Chairman responsible for economic and financial affairs in
1986. From 2000 to 2013, he was Dassault Aviation Chairman-
Chief Executive Officer. In January 2013, Charles Edelstenne was
appointed Chief Executive Officer of Groupe Industriel Marcel
Dassault. He was founder, Manager then President and Chief
Executive Officer of Dassault Systèmes and is currently Chairman
of its Board of Directors.
End of current term: General Meeting called to approve the
financial statements for the year ended December 31, 2017.
Date of first appointment: 04/08/1993
Dassault Systèmes shares owned at December 31, 2015:
15,618,506 (including a majority of beneficial ownership shares)
Age: 78
Nationality: French
Professional address: Groupe Industriel Marcel Dassault –
9 Rond-point des Champs Élysées – Marcel Dassault, 75008 Paris
– France
Other current positions and Directorships:
Inside Dassault Group, in France: Chief Executive Officer and
member of the Supervisory Board of Groupe Industriel Marcel
Dassault SAS (GIMD)(1), Honorary Chairman and Director of
Dassault Aviation SA (listed company, subsidiary of GIMD),
Director of Sogitec Industries SA
Inside Dassault Group, outside France: Director of SABCA (listed
company, subsidiary of GIMD) (Belgium), Director of Dassault
Falcon Jet Corporation (United States)
Outside Dassault Group: Director of Thales and Carrefour (listed
companies), Honorary Chairman of Gifas(2), Manager of the
partnerships Arie, Arie 2, Nili and Nili 2
Other positions held during the past five years:
Chairman of Gifas and Cidef(3)
Chairman and CEO of Dassault Aviation SA (listed company,
subsidiary of GIMD), Chairman of the Board of Dassault Falcon Jet
Corporation and Chairman of Dassault International, Inc.
(1) GIMD is the main shareholder of Dassault Systèmes SE (See paragraph 6.3.2 “Controlling Shareholder”).
(2) Groupement des Industries Françaises Aéronautiques et Spatiales.
(3) Conseil des Industries de Défense Françaises.
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BERNARD CHARLÈS – PRESIDENT AND CHIEF EXECUTIVE OFFICER
Biography: Bernard Charlès has been Chief Executive Officer
(Directeur Général) of Dassault Systèmes since 2002 when Mr.
Edelstenne became solely the Chairman of the Company’s Board.
Since 1995, Mr. Charlès has had executive functions which he
shared with Mr. Edelstenne. Prior to holding this position, Mr.
Charlès served as Director of the New Technology, Research and
Development and Strategy department from 1986 to 1988 and as
Director of Strategy, Research & Development from 1988 to 1995.
Age: 58
Nationality: French
Professional address: Dassault Systèmes – 10 rue Marcel
Dassault, 78140 Vélizy-Villacoublay – France
Principal responsibility: President and Chief Executive Officer of
Dassault Systèmes SE
End of current term: General Meeting called to approve the
financial statements for the year ended December 31, 2017.
Main other current positions and Directorships (inside the
Dassault Systèmes Group, outside France):
Date of first appointment: 04/08/1993
Dassault Systèmes shares owned at December 31, 2015:
2,890,441
Chairman of the Board of Directors of Dassault Systemes Corp.,
Dassault Systemes SolidWorks Corp., Dassault Systemes Simulia
Corp., Dassault Systemes Biovia Corp. (United States), and
Dassault Systemes Canada Software Inc. (Canada); Chairman
of the Advisory Board (corporate body) of Dassault Systemes
3DExcite GmbH (Germany)
Other positions held during the past five years (all inside the
Group, outside France):
Chairman of the Board of Directors of Dassault Systemes Delmia
Corp., Dassault Systemes Enovia Corp., and Chairman of the
Supervisory Board of RealTime Technology AG (Germany)
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THIBAULT DE TERSANT – SENIOR EXECUTIVE VICE-PRESIDENT AND CHIEF FINANCIAL OFFICER
Biography: Thibault de Tersant has been Senior Executive Vice-
President and Chief Financial Officer of Dassault Systèmes since
2003. He joined Dassault Systèmes in 1988 as Executive Vice-
President and Chief Financial Officer. Prior to joining Dassault
Systèmes, Mr de Tersant served as a finance executive at Dassault
International.
End of current term: General Meeting called to approve the
financial statements for the year ended December 31, 2017.
Date of first appointment: 04/08/1993
Age: 58
Nationality: French
Professional address: Dassault Systèmes – 10 rue Marcel
Dassault, 78140 Vélizy-Villacoublay – France
Main position: Senior Executive Vice-President Chief Financial
Officer
Main other current positions and Directorships:
Inside Dassault Systèmes Group, in France: Chairman of Dassault
Systèmes International SAS
Dassault Systèmes shares owned at December 31, 2015:
127,051
Chairman of the Board of the Dassault Systèmes Endowment
Fund
Inside Dassault Systèmes Group, outside France: Chairman
of the Board of Directors of Spatial Corp., Director of Dassault
Systemes Corp., Dassault Systemes SolidWorks Corp., Dassault
Systemes Simulia Corp., Dassault Systemes Biovia Corp. United
States; member of the Advisory Board (corporate body) of
Dassault Systemes 3DExcite GmbH (Germany)
Outside Dassault Systèmes Group: Director of Temenos (listed
company) (Switzerland); Director of the DFCG (the French
National Association of Chief Financial Officers and Financial
Controllers)
Other positions held during the past five years (all inside the
Group, outside France):
Manager of Elsys SPRL, Director of Dassault Systemes Delmia
Corp., and Dassault Systemes Enovia Corp. (United States)
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JEAN-PIERRE CHAHID-NOURAÏ – INDEPENDENT DIRECTOR
Chairman of the Audit Committee
Chairman of the Compensation and Nomination Committee
Age: 77
Nationality: French
is an
Jean-Pierre Chahid-Nouraï
Biography:
independent
consultant. He was a managing director (administrateur délégué)
of Finanval Conseil from 1992 to 2007. Former member of the
Michelin management and Financial Manager, Mr. Chahid-Nouraï
was also an investment banker at MM. Lazard Frères et Cie,
Banque Veuve Morin-Pons, Financière
Indosuez and S.G.
Warburg, as well as a consultant with McKinsey & Co. He has
also contemporaneously taught finance at ESSEC, the Centre de
Formation à l'Analyse Financière, INSEAD and CEDEP (Centre
Européen d'Éducation Permanente).
Professional address: 56 rue de Boulainvilliers, 75016 Paris –
France
Main position: director
End of current term: General Meeting called to approve the
financial statements for the year ended December 31, 2018.
Other current positions and Directorships:
None
Date of first appointment: 4/15/2005
Dassault Systèmes shares owned at December 31, 2015: 2,054
Other positions held during the past five years:
Director of the Fondation Stanislas pour l’Éducation
NICOLE DASSAULT – DIRECTOR
Age: 85
Nationality: French
Professional address: Groupe Industriel Marcel Dassault –
9 Rond-point des Champs Élysées – Marcel Dassault, 75008 Paris
– France
Main position: member of the Supervisory Board (Conseil de
surveillance) of GIMD
Other current positions and Directorships:
Inside Dassault Group: Vice-Chairman and member of the
Supervisory Board (Conseil de surveillance) of Immobilière
Dassault SA, Chief Executive Officer (Directeur Général Délégué) of
Rond-Point Immobilier SAS, Director of Dassault Aviation (a listed
company), Dassault Medias SA, groupe Figaro SAS and Artcurial
SA and founding member of the Serge Dassault Foundation
Outside Dassault Group: Director of Société des Amis du Louvre
and Société des Amis du Musée d’Orsay
End of current term: General Meeting called to approve the
financial statements for the year ended December 31, 2018.
Date of first appointment: 05/26/2011
Dassault Systèmes shares owned at December 31, 2015: 0*
* Nicole Dassault is a shareholder of GIMD.
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ARNOUD DE MEYER – INDEPENDENT DIRECTOR
Chairman of the Scientific Committee
Member of the Compensation and Nomination Committee
Biography: Arnoud De Meyer is President of the Singapore
Management University. Mr. De Meyer is a specialist in the
management of innovation and has published numerous articles
and books on this subject. He was previously Director of Judge
Business School (University of Cambridge, U.K.) and Professor of
Technology Management at INSEAD and Deputy Dean of INSEAD
in France in charge of Administration and External Relations. He
has also taught at Waseda University and Keio Business School in
Japan and created the INSEAD Campus in Singapore.
End of current term: General Meeting called to approve the
financial statements for the year ended December 31, 2018.
Date of first appointment: 4/15/2005
Dassault Systèmes shares owned at December 31, 2015: 1,161
ODILE DESFORGES – INDEPENDENT DIRECTOR
Member of the Audit Committee
Biography: Odile Desforges graduated from the École Centrale
Paris in 1973. She began her career at the Transport Research
Institute, before joining Renault in 1981 as Planner and then
Product Engineer. In 1986, she joined the purchasing department.
She was Body Equipment Purchasing General Manager for
Renault/Volvo Purchasing Organization, then for Renault. In
1999, she became Executive-Vice-President of Renault-VI Mack
Group, before becoming in 2001 President of Volvo Group’s 3P
Business Unit.
In 2003, she was appointed Senior Vice-President, Purchasing,
and Chairwoman and Managing Director of Renault Nissan
Purchasing Organization (RNPO). Between March 1, 2009 and
July 1, 2012, she was Executive Vice-President, Engineering and
Quality, and a member of the Group Executive Committee.
End of current term: General Meeting called to approve the
financial statements for the year ended December 31, 2016.
Date of first appointment: 05/30/2013
Dassault Systèmes shares owned at December 31, 2015: 300
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Age: 61
Nationality: Belgian
Professional address: Singapore Management University –
81 Victoria Street, Singapore 188065 – Singapore
Main position: President of the Singapore Management
University
Other current positions and Directorships:
Outside France: Director of Temasek Management Services
Pte. Ltd, Singapore International Chamber of Commerce, SMU
Ventures Pte. Ltd, member of the Board of Directors of Singapore
National Research Foundation, Director of the Singapore
Symphony Orchestra
Other positions held during the past five years:
Director of Kylian Technology Management Pte. Ltd.
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Age: 66
Nationality: French
Professional address: 3 rue Henri Heine, 75016 Paris – France
Main position: director
Other current positions and Directorships:
In France: Director of Safran and Sequana (listed companies)
Outside France: Director of Johnson Matthey Plc (United
Kingdom)
Other positions held during the past five years:
Director of RNBV, RNTBCI and Renault Espana SA
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MARIE-HÉLÈNE HABERT – DIRECTOR
Biography: After a Master’s degree in Business Law and Taxation,
a business law practitioner diploma (Assas, 1988) and a Master’s
in Strategy and Marketing (Sciences Po, 1989), Marie-Hélène
Habert began her career at DDB Publicité in London as a media
planning consultant. She joined the Dassault Group in 1991 as
Deputy Director of Communications. Since 1998, she has been
Group Director of Communication and Patronage.
End of current term: General Meeting called to approve the
financial statements for the year ended December 31, 2015. A
resolution for her re-appointment will be submitted for approval
at the General Meeting of May 26, 2016.
Date of first appointment: 07/23/2014
Dassault Systèmes shares owned at December 31, 2015: 500*
* Marie-Hélène Habert is a shareholder of GIMD.
TOSHIKO MORI – INDEPENDENT DIRECTOR
Member of the Scientific Committee
Biography: Toshiko Mori is the Robert P. Hubbard Professor in the
Practice of Architecture at Harvard University’s Graduate School of
Design and was the Chairman of the department of architecture
from 2002 to 2008. She is principal of Toshiko Mori Architect, and
founder of VisionArc, a think-tank promoting global dialogue for a
sustainable future. Her firm’s recent work includes performance
spaces for the Brooklyn Children’s Museum and for ART/New
York, as well as the School of Environmental Science for Brown
University, a Master Plan for New York University, and a laboratory
facility for Novartis’ Cambridge Campus. She is also a member of
the World Economic Forum Global Agenda Council on The Future of
Cities, member of the G1 Summit (Japan), Master Jury Member of
the Aga Khan Prize and Master Jury Member of the Holcim Award
2014 for North America. Lastly she is a partner of Paracoustica, a
non-for-profit organization which builds portable concert halls for
the benefit of disadvantaged populations to foster an appreciation
of music.
End of current term: General Meeting called to approve the
financial statements for the year ended December 31, 2018.
Date of first appointment: 05/26/2011
Dassault Systèmes shares owned at December 31, 2015: 600
Age: 50
Nationality: French
Professional address: Groupe Industriel Marcel Dassault –
9 Rond-point des Champs Élysées – Marcel Dassault, 75008 Paris
– France
Main position: Director of Communication and Patronage,
Dassault Group
Other current positions and Directorships:
Inside Dassault Group: member of the Supervisory Board of
GIMD, permanent representative of GIMD on the Supervisory
Board of Immobilière Dassault, member of the Board of Directors
of Dassault Aviation (a listed company), member of the Strategy
Committee of Dassault Développement, Director of the Serge
Dassault Foundation, Director of Artcurial
Outside Dassault Group: Director of Biomérieux (a
listed
company), General Manager of H Investissements, General
Manager of HDH and member of the Strategy Committee of HDF
Age: 64
Nationality: Japanese
Professional address: Toshiko Mori Architect, 199 Lafayette
Street, New York NY 10012 – USA
Main position: Partner of Toshiko Mori Architect PLLC
Other current positions and Directorships:
Outside France: Robert P. Hubbard Professor in Harvard Graduate
School of Design, member of the American Institute of Architects
College of Fellows, member of the World Economic Forum Global
Agenda Council on Future of Cities, member of the Supervisory
Board of A + U Magazine, member of the G1 Summit (Japan),
Master Jury Member in Aga Khan Prize and member of the
Sydney Modern jury
Other positions held during the past five years:
President of World Economic Forum Global Agenda Council on
Design
Member of the Board of Directors of Architecture for Humanity,
member of the World Economic Forum Global Agenda Council on
Design & Innovation
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5.1.1.2
Practices of the Board of Directors
Separation of the offi ces of Chairman and Chief
Executive Offi cer
Dassault Systèmes separated the offices of Chairman of the
Board of Directors (Mr. Edelstenne) and Chief Executive Officer
(Mr. Charlès). In addition to the balance of powers that this
offers, it enables the Chairman and the Chief Executive Officer
to concentrate on their specific remits (described below)
within an experienced and harmonious management team
(Mr. Edelstenne previously held both roles as Chairman and
Chief Executive Officer of Dassault Systèmes SE).
The Chairman of the Board organizes and supervises the work
of the Board and reports thereon at the General Shareholders
Meeting. He ensures the proper functioning of the Board and
the committees of Dassault Systèmes SE and their compliance
with the best practices of good corporate governance, for
example, by making sure that the directors are capable of
fulfilling their duties. The Chief Executive Officer keeps him
regularly informed of significant matters concerning the
Company and in particular its strategy, organization and
investment projects. The Chairman also oversees maintaining
quality relations with shareholders in close coordination with
measures taken in this area by the Chief Executive Officer.
All of these tasks of the Chairman of the Board are directed
toward serving the Company, and his actions are taken into
account in reviewing and determining his compensation.
The Chief Executive Officer is vested by law with the most
comprehensive powers to represent Dassault Systèmes
SE, subject to the
in
paragraph 5.1.1.4 “Powers of the Chief Executive Officer”
below. He represents Dassault Systèmes SE in its dealings
with third parties.
limitations of powers
indicated
The Board of Directors has set up a number of special
committees to help it perform its tasks: the Audit Committee
(established in 1996), the Compensation and Nomination
Committee and the Scientific Committee (established in
2005). The committees report regularly to the Board as
to the performance of their missions. The composition
of these committees and their practices are described in
paragraph 5.1.1.3 “Composition, Practices and Activities of
the Board Committees”.
Main provisions of the Board’s internal regulation
The Board of Directors established its internal regulation
(amended on December 4, 2015) to reflect the conversion of
Dassault Systèmes SA into a European company. It defines
the objectives, and the rules governing the composition
and operation of the Board and its committees, and their
interactions. The Audit Committee has its own charter, which
was updated in March 2015.
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The internal regulation stipulates the frequency of the Board
meetings take place and how Board members may participate
in them. It also provides rules on the information and
disclosure provided to the Board members on a regular basis
(e.g. information on off-balance sheet commitments and the
cash position) and on when an event occurs that might have
a material impact on the Company’s prospects, outlook or on
the implementation of the Company’s strategy.
The internal regulation requires that, each year:
(cid:125) the Board reviews the independence of the directors;
(cid:125) the non-executive directors meet on one occasion without
the other directors to have a general discussion on the
practices of the Board of Directors, and if applicable, debate
specific subjects; and
(cid:125) the Board discusses its practices. Every three years, the
Board conducts a formal review.
With regard to the obligations applicable to directors,
the internal regulation provides a reminder of the legal
confidentiality requirements and reflects the ethical rules set
out in the AFEP-MEDEF Code, particularly in the area of conflicts
of interest. In terms of the number of positions held in other
companies, each director is required to inform the Board of
any other position held in another French or foreign company,
including in their committees. Moreover, the executive officers
(dirigeants mandataires sociaux) must first obtain the approval
from the Board prior to accepting a new term of office in a
listed company. The internal regulation also requires them to
hold, directly or indirectly, a relatively significant number of
Dassault Systèmes SE shares, and to comply with the Group’s
rules on the prevention of insider trading. These rules prohibit
directors from trading in any securities issued by Dassault
Systèmes if they are aware of any insider information and
during the trading blackout periods defined by the said rules.
Even outside of these blackout periods, directors must obtain
the Insider Committee’s prior approval for any transactions
involving Dassault Systèmes’ shares.
The Board of Directors’ activities in 2015
The Board of Directors met nine times in 2015, with an
attendance rate of 92%.
In addition to the deliberations on its agenda pursuant to the
law (notice of the General Meeting and approval of the annual
management report), the Board also discussed principally the
following issues:
(cid:125) the Company’s strategy (definition and review of strategic
directions, review of partnership, acquisition, financing and
guarantee transactions);
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(cid:125) the accounts and the budget (approval of the 2014 annual
financial statements and consolidated financial statements,
the consolidated financial statements for the first half of
2015, the 2015 forward accounts and the review of the
2015 quarterly results); the Board is kept informed as to
the Group’s financial position by reports from the Audit
Committee and presentations made at each meeting by the
Senior Executive Vice-President and Chief Financial Officer;
(cid:125) it holds a debate at least once a year on its practices, and
conducts a formal review every three years, in accordance
with its internal regulation and the AFEP-MEDEF Code.
During the evaluation conducted in 2015, the members of
the Audit Committee said that they wished to be assisted by
a third director, which has been welcomed by the Board and
the management and is the subject-purpose of a proposition
to appoint a new director (see Chapter 7 "General Meeting").
5.1.1.3
Composition, Practices and Activities
of the Board committees
Audit Committee
The Audit Committee consists solely of independent directors:
Odile Desforges and Jean-Pierre Chahid-Nouraï (Chairman of
this Committee). Both of them have been Company directors
and have financial or accounting expertise.
It is the task of the Audit Committee to oversee:
(cid:125) matters related to the preparation and the auditing of
accounting and financial information, in compliance with
the applicable regulations and its Charter;
(cid:125) the preparation process for financial information, the
effectiveness of the internal control and risk management
systems, the audit by the Statutory Auditors of the annual
financial statements and consolidated financial statements
and the independence of the Statutory Auditors and;
(cid:125) the relationship between Dassault Systèmes SE and its
Statutory Auditors. In this regard, the Audit Committee
is involved in appointing and reappointing the Statutory
Auditors and in appointing them for non-audit related
missions.
On all
recommendations to the Board of Directors.
these matters,
this Committee
reports
its
Lastly, it approves the annual plan for internal audits and gives
its opinion on the department’s organization.
In the performance of its missions, the Audit Committee is
given presentations by the Group’s financial management,
particularly regarding risks and, as the case may be, off-balance
sheet commitments, and during the audit of the financial
statements, a presentation from the Statutory Auditor on
the results of the statutory audit and the accounting options
selected. With regard to the efficiency of the internal control
and risk management systems, the Statutory Auditors informs
the Audit Committee of their main findings and the Internal
Audit Director reports to the Audit Committee the conclusions
of his work. In addition, the Committee may call on external
experts, having assessed their expertise and independence.
(cid:125) the review of the assessment of the internal control system;
(cid:125) the amendment of the Board’s internal regulation and the
Audit Committee’s charter;
(cid:125) the compensation of directors and allocation of shares and
share subscription options;
(cid:125) the composition and the functioning of the Board (review
of directors identified as independent, examination of
materiality of any business relationships with the Group);
(cid:125) the compliance of Dassault Systèmes SE with the rules and
recommendations on corporate governance;
(cid:125) the creation of a foundation in the form of an endowment
fund;
(cid:125) the conversion of Dassault Systèmes into a European
company.
Directors’ training
In accordance with the AFEP-MEDEF Code, each director may
request, if he or she considers it necessary, additional training
relating to Dassault Systèmes’ specific features, businesses
and markets. In addition, in 2015 an information day has been
organised for the independant directors. This information day
will be extended in 2016 to all the directors.
In addition, the members of the Audit Committee receive,
upon appointment, information on the specific accounting,
financial and operational aspects of the Group. Finally, the
director who represents the employees may, upon his or her
appointment, receive training appropriate to the exercise of
his or her term of office.
The Board’s review of its practices and performance
The Board of Directors is constantly seeking to improve its
practices. It has two ways of doing this:
(cid:125) it asks the non-executive directors for their comments on
the subject. The non-executive directors meet every year
to discuss the Board’s practices. In 2015, a presentation
was made to them on this topic, after which they were able
to have a discussion without the presence of the Dassault
Systèmes teams, before reporting on their discussion to the
Board;
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For reasons of organizational efficiency, meetings of the Audit
Committee take place on the same day as Board meetings.
However, as the documentation relating to the consolidated
and annual financial statements is sent out at least five
days before the Board approves the accounts, the members
of the Audit Committee have enough time to review the
documentation and to discuss it, if necessary, before the
Board meeting.
In 2015, the Audit Committee met eight times, including
three meetings at head office, which were attended by the
Senior Executive Vice-President and Chief Financial Officer,
the Company Finance Vice-President, the Group Controller,
the Financial Reporting Director, the Internal Audit Director,
the General Counsel and the Statutory Auditors of the
Company, with which regular discussions were held without
the management in attendance. The meetings preceding the
disclosure of the quarterly results took place by conference
call. The attendance rate for meetings of the Audit Committee
in 2015 was 100%.
During 2015, the Audit Committee had the opportunity to
express an opinion on the following various topics:
(cid:125) evolution of IFRS 15 relating to revenue recognition;
(cid:125) presentation of the OCDE recommendation relating to the
Base Erosion and Profit Shifting (BEPS);
(cid:125) Group’s IT security program;
(cid:125) Business Ethics & Compliance program;
(cid:125) to propose to the Board the nomination or renewal of
directors and examine the independence of those who are
so identified, based on criteria set out in the AFEP-MEDEF
Code;
(cid:125) to examine the Company’s policy for nominating, and to
be informed of the compensation policy for the managers,
including non-executive officers;
(cid:125) to discuss the employee profit-sharing and incentive plan
comprised of grants of performance shares and share
subscription options; and
(cid:125) to propose to the Board of Directors solutions in case of
vacancy of the position of Chairman of the Board and of
Chief Executive Officer.
When the Compensation and Nomination Committee carries
out its nomination work, it liaises with the Chief Executive
Officer and the Chairman.
In relation to its duties, the Committee met two times in 2015,
with an attendance rate of 100%. During these meetings,
the Committee made recommendations to the Board on the
following subjects:
(cid:125) the independence of directors, which was in reviewed in
relation to the responses of each director to a questionnaire;
(cid:125) the amount and allocation of the fees allocated to directors;
(cid:125) the renewal and the ratification of directors;
(cid:125) the compensation of executive officers
(dirigeants
(cid:125) setting up of a term loan facility agreement; and
mandataires sociaux);
(cid:125) possible acquisitions of target companies, as well as Group’s
(cid:125) the share plans and share subscription option plans for
corporate simplification scheme.
Group directors and employees.
Compensation and Nomination Committee
The Compensation and Nomination Committee is comprised
solely of independent directors: Mr. Chahid-Nouraï (Chairman)
and Mr. De Meyer.
The main duties of this Committee are:
(cid:125) to propose to the Board of Directors the amounts for
compensation and benefits of the executive officers
(dirigeants mandataires sociaux), including the formulas and
the rules to apply for determining variable compensation,
and to verify the application of these rules;
(cid:125) to evaluate the overall amount and the allocation of the
directors’ fees;
On a general and ongoing basis, the Compensation and
Nomination Committee monitors the compliance of Dassault
Systèmes with the law and best practice in the area of corporate
governance, particularly with regard to the composition of the
Board.
Scientifi c Committee
Like the other Board committees, the Scientific Committee is
comprised solely of independent directors: Ms. Toshiko Mori
and Mr. Arnoud De Meyer (Chairman of this Committee).
It meets at least once a year. The Committee reviews the
main directions of research and development, as well as
the Company’s technological achievements and makes
recommendations on these matters. The persons with principal
responsibility for these matters within Dassault Systèmes are
invited to the Committee’s meetings.
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The Scientific Committee met three times in 2015, with an
attendance rate of 83%. At these meetings, it reviewed a
number of topics central to Dassault Systèmes strategy and
in particular:
(cid:125) the actions and services relating to the Cloud carried out by
the Group with respect to the Biosphere for life sciences and
the Geosphere for the virtual planet and urban systems; and
(cid:125) the 3DEXPERIENCE platform which allows to connect
various elements within the value chain and the crowd
innovation. In this context, it has focused on opportunities
offered by the world of Makers and by the creation of the
3DEXPERIENCE Lab, the purpose of which is to catalyse
the innovation of young companies on the collaborative
capabilities of the Dassault Systèmes platform.
5.1.1.4
Powers of the Chief Executive Offi cer
Pursuant to French law, the Chief Executive Officer represents
Dassault Systèmes SE in dealings with third parties within the
5.1.2 The Executive Committee
limits set by the corporate purpose of the Company and by
the powers reserved by law to the shareholders or the Board
of Directors.
However, under the Dassault Systèmes SE’s by-laws, certain
decisions of the Chief Executive Officer are submitted to
the prior approval of the Board. This concerns, in particular,
acquisitions or the disposal of an entity, shareholding or asset
(excluding internal transactions) or the use of external funding
(bank loan or capital market issue), if the amount of the
transaction exceeds a threshold set each year by the Board.
This threshold, which was set by the Board on March 17,
2016, is € 500 million.
On March 17, 2016, the Board also renewed its authorization to
the Chief Executive Officer to grant guarantees, endorsements
or securities in the name of Dassault Systèmes SE up to an
aggregate amount of €500 million.
The Executive Committee assists the Chief Executive Officer. The Committee comprises the heads of the main business areas and
functions of Dassault Systèmes:
Bernard Charlès (1)
Dominique Florack
Thibault de Tersant (2)
Bruno Latchague
Monica Menghini
Pascal Daloz
Sylvain Laurent
Laurent Blanchard
Laurence Barthès
Philippe Forestier
Chief Executive Officer
Senior Executive Vice-President, R esearch and D evelopment
Senior Executive Vice-President, Chief Financial Officer
Senior Executive Vice-President, Global Field Operations (Americas), Industry solutions
and Indirect channels
Executive Vice-President, Chief Strategy Officer
Executive Vice-President, Brands and Corporate Development
Executive Vice-President, Global Field Operations (Asia-Oceania), Worldwide Business
Transformation
Executive Vice-President, Global Field Operations (EMEAR)(3), Worldwide Alliances and Services
Executive Vice-President, Chief People and Information Officer
Executive Vice-President, Global Affairs and Communities
(1) Mr. Bernard Charlès is also a director of Dassault Systèmes SE and an executive officer (dirigeant mandataire social) as defined by the AFEP-MEDEF Code.
(2) Mr. Thibault de Tersant is also a director of Dassault Systèmes SE.
(3) Europe Middle-East Africa Russia.
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5.1.3 Declarations Regarding the Administrative Bodies
and Senior Management
To Dassault Systèmes SE’s knowledge:
(cid:125) there is no family relationship between the Company’s
directors, or between a director and a member of the
Executive Committee (see paragraph 5.1.2 above for the list
of members), with the exception of Ms. Nicole Dassault and
her daughter Ms. Marie-Hélène Habert;
(cid:125) in the past five years, none of the directors or members of
the Group’s Executive Committee has been convicted of
fraud, been declared bankrupt or their property impounded
or liquidated, been subject to an official accusation and/
or penalty delivered by legal or regulatory authorities, or
been prohibited by a court from becoming a member of
an administrative, management or supervisory body of a
company, or from being involved in the management or
direction of the affairs of a company;
(cid:125) there are no potential conflicts of interest between the
duties to the Company of the members of the Board of
Directors and their private interests and/or other duties, and
no director or member of the Group’s Executive Committee
has been named to the Board or to an administrative,
management or supervisory body as a result of an
agreement between the Company’s main shareholders,
customers, suppliers or any other persons;
(cid:125) no director or member of the Group’s Executive Committee
is party to a service contract with Dassault Systèmes SE,
or one of its subsidiaries, which provides him or her with a
personal benefit; and
(cid:125) no loans or guaranties have been granted or established on
behalf of the directors or members of the Group’s Executive
Committee, and there are no assets used by the Company
which belong directly or indirectly to the directors, members
of the Group’s Executive Committee or their families.
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5.1.4 Principles Established by the Board of Directors pertaining
to Compensation of the Executive Offi cers and Directors
Dassault Systèmes SE’s compensation policy is designed
to attract, motivate and retain highly qualified individuals,
with the aim of ensuring the success of Dassault Systèmes.
This success depends on the achievement of its objectives,
in particular, strategic, business and financial objectives, over
the medium and long term. In setting criteria for determining
compensation, Dassault Systèmes seeks to strike a balance
between short-, medium- and long-term financial objectives,
in order to take into account the creation of stockholder value
and recognize individual performance.
Since 2013, the AFEP-MEDEF Code has recommended
submitting the elements of the compensation due or allocated
to each executive officer during the year to the vote of
shareholders. The shareholders of Dassault Systèmes SE were
therefore invited to vote at the 2015 General Meeting on the
compensation with respect to the 2014 financial year of the
Chairman of the Board (7th resolution) and the Chief Executive
Officer (8th resolution). These resolutions were approved by
98.02% and 96.20%, respectively.
The shareholders will be consulted again on the elements
of compensation for fiscal year 2015 (see paragraph 7.1
“Presentation of the Resolutions Proposed by the Board of
Directors to the General Meeting on May 26, 2016”).
The annual compensation of the Chairman of the Board is
a fixed amount. The compensation of each member of the
Executive Committee is comprised of a fixed portion and
a variable portion. The variable portion may represent a
significant part of the total compensation if the annual targets
are achieved or outperformed. The targets are reviewed every
year in order to be consistent with the Company’s strategic
orientations and include individual management targets.
Members of the Executive Committee within the French scope,
except for the Chief Executive Officer, are also eligible for profit-
sharing payments in the same manner as other employees
of Dassault Systèmes SE, as described in paragraph 5.1.4.5
“Employee Profit-sharing”.
Grants of share subscription options and performance shares
generally occur during identical periods. However, there may
be rare exceptions to this rule, depending on the knowledge of
inside information or the complex planning of the grants given
the numerous changes in the tax and legal frameworks.
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5.1.4.1
Compensation of Executive Offi cers
Each year the Board of Directors sets the amount of the
Chairman’s compensation (fixed only). At its meeting on
March 17, 2016, the Board of Directors set the amount of the
Chairman’s 2016 compensation at €982,000. The Chairman’s
compensation has therefore remained the same since 2014.
As regards the Chief Executive Officer, his annual target
compensation with objectives achieved for is comprised of a
fixed portion for 50%, paid monthly, and a variable portion
for 50%, paid annually in relation to the achievement of the
performance criteria previously set by the Board of Directors.
The level of achievement of the objectives determines the
amount actually paid for the variable compensation, which
can result in a payment below the target, or up to 140%.
Each year the Board of Directors sets the annual target
compensation with objectives achieved for the Chief Executive
Officer. Any significant change in his fixed compensation is
made over the long term and relates to the increase in the
Group’s scope and market footprint. In 2015, the Board of
Directors therefore significantly revised the Chief Executive
Officer’s base compensation, including the fixed part, to
account for the Group’s increased scope arising from the
multiple acquisitions made since 2005, the last time his
compensation was significantly revised. The Board of Directors
has decided for 2016 that the Chief Executive Officer’s fixed
annual compensation will remain the same as in 2015.
In addition, the Chief Executive Officer receives benefits in-kind,
as indicated in paragraph 5.3 “Summary of Compensation and
Benefits Due to Directors”, which contains all the information
with respect to compensation of the executive officers.
The amount of the variable compensation due to the Chief
Executive Officer for 2015, paid in 2016, was fixed at
€1,523,750 by the Board of Directors during its meeting held
on March 17, 2016, after review of the achievement of the
performance criteria set in 2015.
These criteria are set forth in the following table with an indication of their weighting:
Performance criteria categories
Diluted net profit per share on a non-IFRS consolidated basis (hereinafter referred to as the “EPS”)
for 2015 as announced by the Company
Company’s efficiency processes
Dassault Système’s competitive position
Composition of product portfolio
Implementation of the Group’s short-, medium- and long-term strategy
Type
Weighting
Quantitative
Quantitative
Quantitative
Qualitative
Qualitative
20%
20%
20%
20%
20%
During its meeting held on March 17, 2016, the Board of
Directors also set the foregoing performance criteria categories
to assess the payment of the CEO’s variable compensation
for 2016. Therefore, those performance criteria categories
show, for 2016, a limit of 40% to the purely qualitative
part of this variable compensation . In order to protect the
Company’s competitive position, the Board of Directors
considered that it was not appropriate to disclose further
details of the performance criteria. These criteria, which are
discussed by the Compensation and Nomination Committee
and the Board, are both internal and external in nature and
depend on the Group’s annual performance or its multi-year
strategy (medium- and long-term). In addition, they include a
strong “Social and Environmental Responsibility” dimension
in relation with the Group’s business, each of Dassault
Systèmes’ brands containing a promise of sustainable
(see paragraphs 2.2.2.1 “3DEXPERIENCE
development
platform for sustainability: apps and solutions for sustainable
development”, 2.1.4 “Rewarding performance and recognizing
employees” and 2.1.2.3 “Developing relations with the social,
regional and community environment”).
At its meeting of March 17, 2016, the Board of Directors set
for 2016 the annual target compensation with objectives
achieved for the Chief Executive Officer at €2,650,000 , half of
which will vary in relation to the achievement of the objectives.
This amount is the same to the amount for 2015 set forth by
the Board of Directors on March, 20, 2015.
The Chairman of the Board and the Chief Executive Officer are
not beneficiaries of an additional retirement plan, nor are they
entitled to any indemnities under a non-competition clause.
The Chairman and Chief Executive Officer also receive
director’s fees (see paragraph 5.3 “Summary of Compensation
and Benefits Due to Directors”).
5.1.4.2
Indemnities Due in the Event of the
Imposed Departure (départ contraint)
of the Chief Executive Offi cer
In accordance with the French Commercial Code and the
AFEP-MEDEF Code, the principle and the amount of the
indemnity paid to the Chief Executive Officer upon the
termination of his functions are subject to conditions, in
particular performance conditions. Thus the
indemnity
would be due in case of a change in control or strategy duly
acknowledged by the Board of Directors, which results in
an imposed departure (départ contraint) in the subsequent
12 months. The indemnity may also be paid if the imposed
departure is not linked to poor results of the Company or to
mismanagement by the Chief Executive Officer, the Board
of Directors being entitled to decide to pay all or part of the
indemnity. The Board decided to provide for this indemnity
payment, which is in addition to those recommended by the
AFEP-MEDEF Code, given the shareholder structure of the
Company and the length of service to the Company of the
Chief Executive Officer.
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However, the indemnity would not be due in the event the
Chief Executive Officer would leave the Company on his
own initiative to take a new position elsewhere, or would be
assigned a new position within the Company, or if he would
receive retirement benefits shortly after leaving. Furthermore,
in the event of exceptional circumstances seriously damaging
the image or results of the Company and significantly
reducing, in the opinion of the Board, the market price of the
Company’s shares or in the event of misconduct other than
in connection with his corporate functions (faute séparable de
ses fonctions) and incompatible with the normal performance
of his mandate, the Board may decide that the indemnity
payment is not due.
The amount of the indemnity due to the Chief Executive
Officer in the event of the termination of his functions will
be equivalent to a maximum of two years of compensation
as Chief Executive Officer and will depend on satisfying the
performance conditions established for calculating his variable
compensation. The amount paid would be calculated pro
rata with respect to the percentage of variable compensation
which was paid during the three years preceding his departure
as compared to the targeted variable compensation for such
years. The amount due would be calculated by applying the
following formula:
(cid:125) the aggregate gross compensation (including variable
compensation but excluding compensation in kind and
directors’ fees) due in connection with his position for the
two years completed prior to the date of departure;
(cid:125) multiplied by the quotient of (i) the amount of variable
compensation actually paid during the three financial years
completed prior to the date of departure with regard to
their respective years of reference (numerator), divided by
(ii) the amount of target variable compensation determined
for each of these years by the Board of Directors on the
basis of achievement of the objectives set for the Company
(denominator).
The indemnity is thus subject to performance conditions
related to achieving targets fixed for the variable compensation.
5.1.4.3
Performance Shares and Share
Subscription Options
The members of the Group’s Executive Committee are given
long-term incentives notably through grants of Dassault
Systèmes performance shares or share subscription options
to associate them with the development and performance
of the Company. In general, performance shares or share
subscription options may be granted to key employees of
the Company, and the number granted to each of them is
dependent on performance and level of responsibility.
T he General Meeting of September 4, 2015 set the maximum
number of shares which could be granted to the executive
officers (dirigeants mandataires sociaux) at 35% of the overall
amount approved (1,793,169 shares).
Officer (“2015-B Shares”) as part of the gradual process
of associating Mr. Charlès with the Company’s capital
that began several years ago, with the aim of recognizing
his entrepreneurial role during more than 30 years with
the Company and providing him with an equity interest
comparable to that of founders of companies in the same
sector or more generally his peers in technology companies
around the world.
These 300,000 2015-B shares represent 5.86% of the overall
amount approved by the General Meeting of September 4,
2015.
The vesting of these shares to the Chief Executive Officer
is subject to his remaining in office and two cumulative
performance conditions:
(cid:125) the first performance condition is identical to that of the
2015-A performance shares plan decided by the Board held
on September 4, 2015, for the benefit of certain employees
of the Group. This performance condition is based on the
two following alternative criteria: (i) intrinsic performance
of the Group measured by the increase of the EPS for
2016 compared to the EPS for 2014, it being specified
the objective of such increase must be at least equal to a
minimum (in percentage) set by the Board of September 4,
2015, or (ii) the performance of the Dassault Systèmes stock
price measured by reference to the difference between the
evolution of the stock price as at closing of the last trading
day for the years 2014 and 2016, with the value of the CAC
40 index as at closing of trading day at the same dates, this
performance must be at least equal to a minimum annual
threshold (in percentage points) set by the same Board; and
(cid:125) the additional performance condition, only applicable to the
Chief Executive Officer, relates to its variable remuneration
for the 2015 and 2016 years, actually paid in 2016 and
2017, the amount of which is depending upon the level of
achievement of performance criteria set by the Board.
In accordance with the AFEP-MEDEF Code and AMF
recommendations, the Board dated September 4, 2015 has
also set forth the commitment of the CEO to maintain in a
registered form at least 15% of the total amount of shares
he acquires as a consequence of the 2015-B grant, such
percentage being calculated after deduction of the number of
shares which would be necessary to sell to pay taxes, social
charges and expenses related to the sale of the total number
of shares vested.
The Chief Executive Officer also has formally agreed not to use
foward contrats in order to secure a capital gain in connection
with the acquisition of the sale or the exercise of share
subscriptions options, until the expiry of the legal lock-up
period. The Dassault Systèmes’ Insider Trading Rules already
imposed such restriction.
Further information concerning share subscription options and
performance shares is provided in paragraph 5.3 “Summary of
Compensation and Benefits Due to Directors”.
Within the framework of this authorisation, the Board of
Directors (which met on the same day) decided, on the
recommendation of the Compensation and Nomination
Committee, to grant 300,000 shares to the Chief Executive
Furthermore, on September 7, 2015, the Chief Executive
Officer acquired the 28,000 2010-04 performance shares
that were granted to him on September 7, 2012 (the 14,000
shares initially granted have been increased to 28,000 further
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to the two-for-one split of the Dassault Systèmes share on
July 17, 2014), after the Board of Directors determined that
the applicable performance conditions had been met.
Aside from Dassault Systèmes SE, no other Group company has
granted shares or options to corporate officers (mandataires
sociaux) in 2015.
5.1.4.4 Directors’ Fees
Since the General Meeting of May 26, 2014, the maximum
annual amount of directors’ fees is set at €350,000. For
2015, the amount of the directors’ fees actually granted to
the Dassault Systèmes SE directors was €314,000, of which
€154,000 was for their positions (fixed portion) and €160,000
was for attendance of meetings of the Board of Directors and
its committees (variable portion). In accordance with the
AFEP-MEDEF Code, the variable portion of the directors’ fees
is greater.
The distribution of the fees among the directors for 2015
is based on the following principles, which were set by the
Board of Directors in its meeting on May 28, 2015 and are
identical to those used for 2014: €15,000 per director, an
additional €15,000 for the Chairman of the Board of Directors
and an extra €4,000 for the Chairman of the Audit Committee
(these amounts are prorated for the actual period served
in the positions during the year); €2,000 per director for
physically attending a Board meeting; €4,000 per member
of the Audit Committee for physically attending a meeting
of that Committee; €2,000 per member of the Compensation
and Nomination Committee or Scientific Committee for
each meeting of these committees they physically attend;
and €1,000 each per conference call or videoconference in
relation to a meeting of the Board of Directors or one of these
committees.
5.1.4.5
Employee profi t-sharing
Finally Dassault Systèmes SE has profit-sharing plans for
all employees. The results of the year ended December 31,
2015, which are subject to approval by the General Meeting
on May 26, 2016, should thus enable the distribution of an
amount €42,326,455.75 in profit-sharing (intéressement et
participation).
More than 90% of the employees of the French subsidiaries
held directly by Dassault Systèmes SE also benefit from
profit-sharing agreements. For more information on these
agreements, see paragraph 2.1.4 “Rewarding performance
and recognizing employees”.
5.1.5 Application of the AFEP-MEDEF Code
Dassault Systèmes refers to the recommendations of the
AFEP-MEDEF Code and reviews its corporate governance
practices on a regular basis in order to achieve continual
improvement in this area.
As permitted by such Code and the law, Dassault Systèmes SE
has not adopted all of the Code’s provisions, or has adopted
certain provisions in modified form, in view of its particular
situation or due to its compliance with other provisions of the
Code. These are summarized in the table below, together with
the reasons for their exclusion/modification.
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Recommendations of the AFEP-MEDEF Code
Explanation
Time period between the review of the financial
statements by the Audit Committee
and the approval by the Board of Directors
(Article 16.2.1)
Proportion of performance shares in executive
officer compensation
(Article 23.2.4)
Acquisition of shares by the executive officers
(dirigeants mandataires sociaux) benefitting
from grants of performance shares
(Article 23.2.4)
Indemnity payment in the event of the departure
of the Chief Executive Officer only in the case
of an imposed departure or due to a change
in control or strategy
(Article 23.2.5)
For reasons of organizational efficiency, meetings of the Audit Committee take place on the
same day as Board meetings. However, as the documentation relating to the consolidated
and annual financial statements is sent out at least five days before the Board approves the
accounts, the members of the Audit Committee have enough time to review the
documentation and to discuss it, if necessary, before the Board meeting.
A significant portion of the shares granted to the Chief Executive Officer is done as part of
the plan adopted several years ago to progressively associate with the Company’s capital,
with the goal of recognizing his entrepreneurial role during more than 30 years with the
Company and to provide him an equity interest comparable to that of founders of
companies in the same sector, and more generally, of his peers in technology companies
around the world.
Dassault Systèmes SE considers that the lock-up commitment of the Chief Executive
Officer of 15% of the shares which may be acquired as a result of grants, until he terminates
his functions, represents a mechanism with an effect equivalent to the recommendation in
the AFEP-MEDEF Code to subject the performance shares granted to executive officers to
the purchase of a fixed number of shares once such performance shares become available.
Dassault Systèmes SE respects the principles of the AFEP-MEDEF Code in this area and will
not pay an indemnity in the event of poor Company results or mismanagement by the Chief
Executive Officer. It nevertheless retains three cases for payment, one of which is not
explicitly provided for by such Code, in light of Dassault Systèmes SE’s shareholder base and
the long term of service of Bernard Charlès in the Company. It applies in the event of an
imposed departure (départ contraint) if the departure is not related to poor results of the
Company or mismanagement on the part of the Chief Executive Officer. In such case, the
Board could decide to pay all or a portion of the departure indemnity.
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5.1.6
Internal Control Procedures and Risk Management
Because Dassault Systèmes was listed on the stock market in
the United States until the end of 2008, Dassault Systèmes
defined and implemented an internal control procedure based
mainly on the COSO (Committee of Sponsoring Organizations
of the Treadway Commission) framework, as well as on the
AMF’s suggested reference framework regarding internal
control updated on July 22, 2010.
This Chairman’s report on internal control procedures applies
to Dassault Systèmes SE and its consolidated subsidiaries.
5.1.6.1 Defi nition and objectives of internal
control
According to the COSO accounting basis, internal control is
a process implemented by the Board of Directors, managers
and employees, aimed at providing a reasonable guarantee
with regard to achieving the following objectives: performing
and optimizing operations, the reliability of financial and
accounting information, and compliance with the laws and
regulations in force.
The internal control procedures within the Company, whether
at the level of Dassault Systèmes SE or its subsidiaries, are
designed to:
(cid:125) improve the performance and efficiency of operations
through optimized use of available resources (an objective
inspired by the COSO framework);
(cid:125) ensure the reliability, quality and availability of financial data
(an objective inspired by the COSO and AMF frameworks);
(cid:125) ensure that operations comply with legislation in effect and
the Company’s internal procedures (an objective inspired by
the COSO and AMF frameworks);
(cid:125) guarantee the security of assets, particularly intellectual
property, the human and financial resources and the
image of the Company (an objective inspired by the AMF
framework); and
(cid:125) prevent risks of error or fraud (an objective inspired by the
COSO and AMF frameworks).
5.1.6.2
Internal Control Participants
and Organization
All corporate governance bodies participate
implementation of the internal control processes.
in
the
The Board of Directors, concerned with the issue of internal
control, created in 1996 an Audit Committee, with the
mission described above (see paragraph 5.1.1.3 “Composition,
Practices and Activities of the Board Committees”).
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In parallel, the Company’s management has established the
following bodies:
5.1.6.3
Internal Control and Risk
Management Procedures
(cid:125) an Insider Committee responsible for setting and applying
the rules aimed at preventing insider trading. In particular,
this Committee informs all interested parties (employees,
directors, consultants, etc.) of the periods in which they
are prohibited from buying or selling Dassault Systèmes
securities. These blackout periods are longer than those
recommended by the AMF. In addition, as they have regular
access to privileged and insider information in relation to
their roles, the Group managers must obtain the Insider
Committee’s prior approval for any transactions involving
the Company’s securities (as defined in the Group’s
Insider Trading Rules). The Company applies the rules and
recommendations of the AMF regarding the prevention of
insider trading on a general basis;
(cid:125) an Internal Audit department reporting to the Senior
Executive Vice-President and Chief Financial Officer and
to the Audit Committee, one of its main missions is to
evaluate the relevance of Dassault Systèmes’ internal
control processes, to alert the management and the Audit
Committee regarding possible deficiencies or risks, and to
propose measures that will limit the risks and improve the
efficiency of operations. The Internal Audit department also
has the responsibility for the annual assessment, on behalf
of the management, of the internal control mechanisms
related to financial reporting;
(cid:125) an “Ethics & Compliance” department reporting to the
Chief Executive Officer, responsible for ensuring the
implementation and respect of the Code of Business
Conduct, as well as the Company’s specific policies,
recommendations and procedures regarding ethics and
compliance. This department is supported by an Ethics
Committee which meets every month and investigates any
alleged non-conformities brought to its knowledge.
The internal control is also based on the principle of giving
responsibility to each of the departments and subsidiaries
of the Company in its respective area of expertise, and on
delegations of powers to certain members of the Executive
Committee of the Company, such delegations having specific
fields of application.
Moreover, the subsidiaries’ local chief executive and financial
officers are responsible for preparing the subsidiaries’ financial
statements which are included in the Company’s consolidated
financial statements, and the annual financial statements and
management reports for each of their respective subsidiaries,
whether the accounts are prepared by their own financial teams
or by shared internal financial and accounting services centers
located particularly in Japan, in the United States and France.
The Company’s Financial Planning and Analysis department
is responsible for directing the financial objectives of the
Company in accordance with budget monitoring procedures
and, in this respect, performs specific controls and analyses
of the quarterly accounts. It is also responsible for identifying,
analyzing and warning of any differences from the previous
year, the previous quarter and the Company’s budget
objectives, which are subject to a quarterly update.
The internal control mechanisms developed by the Company
promote internal control in the following areas:
(cid:125) control report: The professional ethics of the Company are
set forth in the Code of Business Conduct, which describes
the manner in which Dassault Systèmes expects its business
to be conducted and which may serve as a reference tool
for all Group employees to help guide their behavior and
their interactions in their professional work. The Code
of Business Conduct, which applies to all employees of
Dassault Systèmes and is available on the Group’s internet
site and online community platform, addresses, in particular
(i) compliance with regulations applicable to the Company’s
business, (ii) individual interactions within the Company
and with its ecosystem, and (iii) protecting the Company’s
assets (in particular, the Company’s intellectual property
and that of its clients and partners). The Code also includes
rules governing conflicts of interest, insider trading and
financial reporting. The distribution of the Code of Conduct
is accompanied by training, which is specifically provided to
any new employee and to employees joining the Group as
part of the integration process for such acquisitions;
(cid:125) risk analysis: The main risks which may impact the
performance of the Company are identified, assessed and
regularly reviewed by the management of the Company.
These risks are described in paragraph 1.6.1 “Risks Related
to the Company’s Business”. This paragraph specifies the
measures taken by the Group to manage or limit these risks
whenever possible.
Operational risks are essentially managed by subsidiaries.
Risks in the area of IP protection, ethics and financial risks
are specifically monitored by Dassault Systèmes SE as well
as locally monitored;
(cid:125) protection and monitoring activities:
1) protecting its intellectual property is an on-going
concern for the Group. This protection is ensured by
implementing and monitoring corporate processes
designed to verify the Company’s rights before it
markets its software products. The Company also
protects
inventions through a reasonable and
well-considered approach to filing patents in several
jurisdictions. The Company’s principal brands are also
registered in a large number of countries. The Group is
continuing to actively develop its program designed to
fight against infringement concerning its products,
its
2) information systems security, which
is critical to
ensuring the protection of the source codes for the
Company’s applications, is continually evaluated, tested
and strengthened in the areas of network access or
performance, anti-virus protection, and the physical
information system
security of servers and other
facilities,
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5
objectives set by the Financial department of the Company
and from the previous quarter and financial year.
Thus, each of the subsidiaries prepares a detailed and
documented presentation of its sales activity for the past
quarter and the year, and performs a comparative analysis
of its financial results (revenues and costs) in comparison
with the budget targets of the current year and compared
to the same quarter for the previous year.
Budget projections are reviewed, analyzed and updated
each quarter by the teams of the Financial department
to take into account all changes in the market and the
economic environment, particularly as regards exchange
rates, and to present realistic objectives to shareholders and
financial markets;
(cid:125) improve the reliability of
its consolidation tools and
in order to establish and publish required
processes
financial information every quarter as soon as possible. The
consolidation procedure as defined by Dassault Systèmes
SE is based on:
1) giving responsibility to the chief financial officers in the
subsidiaries, who are required to certify the quarterly
statements transmitted to Dassault Systèmes SE and to
provide detailed business reviews and analyses before
the accounts are consolidated,
2) the use of consolidation tools that make data
transmission and processing secure and allow the
elimination of intra-group transactions,
3) standardization of processes and information systems,
particularly with respect to centralizing and recording
most of the transactions at shared services centers,
4) the implementation of an annual process to monitor off-
balance sheet commitments, related-party agreements
(conventions réglementées),
5) a detailed review by the Group’s financial division of
the quarterly accounts of Dassault Systèmes SE and its
subsidiaries,
6) the detailed analysis by the Company’s accounting
department of all the material software license and/or
services transactions in order to validate their correct
accounting recording;
(cid:125) systematize the processes by which the Audit Committee
and the Board of Directors review financial information prior
to publication;
5
(cid:125) structure
its
financial
communications
to ensure
simultaneous and equivalent publication of information
on its principal markets of financial results or any other
information that could have an impact on the price of its
shares.
3) the internal control policies related to the main processes
within the Company (information technology security,
sales administration, human resources, protection of
intellectual property, closing and publication of financial
statements, treasury management, client credit risk
management) are formalized and updated at the level of
both Dassault Systèmes SE and its main subsidiaries or
the related shared services centers,
4) key control points making it possible to prevent or
detect risks impacting the financial information in the
significant entities of the Company are documented,
5) tests are performed annually on these key control points
to evaluate their effectiveness,
6) the operational entities implement action plans with the
goal of continuous improvement;
(cid:125) monitoring: The Company has deployed processes
to monitor, review and analyze on a regular basis its
performance at the level of its main entities, brands,
distribution channels and geographical areas (governance,
budget reviews, activity reviews). In addition, quarterly
communication meetings are also held to ensure a better
dissemination of the Group’s strategy to all its managers
and discussions facilitating its implementation;
(cid:125) audit missions: In 2015, the Internal Audit department
carried out different missions within the Company’s
subsidiaries to verify compliance of the local internal control
procedures with the Company objectives. These missions,
authorized by the Audit Committee, result in the issuance of
recommendations to the local management teams and the
implementation of action plans when deemed necessary
to reinforce the audited processes and organizations.
The Internal Audit department carries out a review of the
implementation of these plans.
In addition, the Company has put in place internal preventative
measures to continue operations and limit the impact of a
significant loss in the event of major damage. As a result,
several secured computer systems protect source codes and all
electronic data stored on the servers, work stations and laptop
computers used in the different entities of the Company. The
computer protection systems are maintained in different sites.
5.1.6.4
Internal Control Procedures Relating
to the Preparation and Treatment of
Financial and Accounting Information
With respect to the internal control processes related to the
preparation of financial and accounting information, the
Company’s focus has been to:
(cid:125) implement a quarterly control system to update budget
objectives and identify and analyze any variation from the
DASSAULT SYSTÈMES DOCUMENT DE RÉFÉRENCE 2015 169
5 Corporate governance
Report of the Chairman on Corporate Governance and Internal Control
5.1.6.5
Evaluation of Internal Control
Since its voluntary delisting from the NASDAQ in October 2008,
Dassault Systèmes SE is no longer subject to the requirements
of the U.S. Sarbanes-Oxley Act with regard to the assessment
of its internal control procedures. The Company therefore
evaluates the internal control procedures applicable to its
in accordance with
principal processes and subsidiaries
European Regulations.
As the Company management aims to maintain a high level
of internal control within the Company, detailed assessment
work was again performed in 2015, as part of the process of
achieving continuous improvement and for the purpose of
preparing targeted action plans and audits. In this respect,
the scope of Group entities subjected to internal control
evaluations, in the form of self-evaluation questionnaires and
internal control reviews conducted in the months immediately
following acquisition continues to expand to entities that had
previously been considered immaterial and to newly acquired
companies. The results of the evaluation of the internal control
are presented to the Audit Committee. In addition, Internal
Control’s efficiency is assessed by the Statutory Auditors.
5.1.6.6
Limitations on Internal Control
The internal control system cannot provide an absolute
guarantee that the Company’s objectives in this area will be
achieved. Inherent limitations apply to all internal control
systems, related in particular to uncertainties the exercise
of individual judgments, or dysfunctions which may occur
as a result of human failure or simple error or in the external
environment.
5.1.7 Other information required by Article L. 225-37
of the French Commercial Code
5.1.7.1
Specifi c Modalities Related
to Shareholders’ Participation
in the General Meeting
Shareholders participate in the General Meetings of the
Company according to provisions specified by law and by
the Company’s by-laws (Articles 24 to 33). Thus, every
shareholder has the right to participate in General Meetings
and deliberations either personally or via a proxy, regardless
of the number of shares held, according to conditions
specified by Article 27 of the by-laws of Dassault Systèmes
(see paragraph 6.1.2 “Memorandum and Specific By-Laws
Provisions”).
In the case of the separation of the ownership of the shares,
the voting right belongs to the bare owner (nu-propriétaire),
except for decisions relating to the allocation of profits, where
it belongs to the beneficial owner (usufruitier).
5.1.7.2 Mention of the publication
of information provided
for by Article L. 225-100-3
of the French Commercial Code
The information required by Article L. 225-100-3 of the
French Commercial Code is indicated in paragraphs 6.3
“Information about the Shareholders” (concerning control
of GIMD), 6.2.4 “Delegations and Authorizations Granted to
the Board of Directors by the General Meeting” (concerning
share issues), 6.2.5 “Stock Repurchase Programs” (concerning
acquisition by Dassault Systèmes SE of its treasury shares),
6.1.2.2 “General Meetings” (concerning the conditions for
exercising voting rights) and 5.1.4.2 “Indemnity Due in the
Imposed Departure (départ contraint) of the Chief Executive
Officer” in this 2015 Annual Report (Document de référence)
which is also a part of the annual management report issued
by the Board of Directors.
The Annual Report (Document de référence) is available on
the AMF website (www.-amf-france.org) and on the Dassault
Systèmes website (www.3ds.com). A press release is issued to
announce when the Annual Report (Document de référence)
becomes available.
Charles Edelstenne
Chairman of the Board
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5
5.2 Report of the Statutory Auditors on Corporate
Governance and Internal Control
This is a free translation into English of the Statutory Auditors’ report issued in the French language and is provided solely for
the convenience of English speaking readers. This report should be read in conjunction with, and construed in accordance with,
French law and professional auditing standards applicable in France.
To the Shareholders,
In our capacity as Statutory Auditors of Dassault Systèmes SE , and in accordance with Article L. 225-235 of the French Commercial
Code (Code de commerce), we hereby report to you on the report prepared by the Chairman of your Company in accordance with
Article L. 225-37 of the French Commercial Code for the year ended December 31, 2015 .
It is the Chairman’s responsibility to prepare, and submit to the Board of Directors for approval, a report describing the internal
control and risk management procedures implemented by the Company and providing the other information required by Article
L. 225-37 of the French Commercial Code in particular relating to corporate governance.
It is our responsibility:
(cid:125) to report to you on the information set out in the Chairman’s report on internal control and risk management procedures
relating to the preparation and processing of financial and accounting information; and
5
(cid:125) to attest that the report sets out the other information required by Article L. 225-37 of the French Commercial Code, it being
specified that it is not our responsibility to assess the fairness of this information.
We conducted our work in accordance with professional standards applicable in France.
Information concerning the internal control and risk management procedures relating
to the preparation and processing of fi nancial and accounting information
The professional standards require that we perform procedures to assess the fairness of the information on internal control and
risk management procedures relating to the preparation and processing of financial and accounting information set out in the
Chairman’s report. These procedures mainly consisted of:
(cid:125) obtaining an understanding of the internal control and risk management procedures relating to the preparation and processing
of financial and accounting information on which the information presented in the Chairman’s report is based, and of the
existing documentation;
(cid:125) obtaining an understanding of the work performed to support the information given in the report and of the existing
documentation;
(cid:125) determining if any material weaknesses in the internal control procedures relating to the preparation and processing of financial
and accounting information that we may have identified in the course of our work are properly described in the Chairman’s
report.
On the basis of our work, we have no matters to report on the information given on internal control and risk management
procedures relating to the preparation and processing of financial and accounting information, set out in the Chairman of the
Board’s report, prepared in accordance with Article L. 225-37 of the French Commercial Code.
Other information
We attest that the Chairman’s report sets out the other information required by Article L. 225-37 of the French Commercial Code.
Neuilly-sur-Seine and Paris-La Défense, on March 18 , 2016
The Statutory Auditors
PricewaterhouseCoopers Audit
French original signed by:
Pierre Marty
ERNST & YOUNG et A utres
French original signed by:
Pierre-Antoine Duffaud
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5 Corporate governance
Summary of the Compensation and Benefi ts Due to Corporate Offi cers (mandataires sociaux)
5.3 Summary of the Compensation and Benefi ts Due
to Corporate Offi cers (mandataires sociaux)
5.3.1 Compensation of the Company’s Corporate Offi cers
(mandataires sociaux)
The tables below provide a summary, in accordance with the recommendations of the AMF and the AFEP-MEDEF Code, of the
compensation and benefits paid to the corporate officers of Dassault Systèmes SE, pursuant to Article L. 225-102-1 of the French
Commercial Code (see also paragraphs 5.1.4 “Principles established by the Board of Directors pertaining to compensation of the
Executive Officers and directors”, 5.3.2.1. “Dassault Systèmes Share Subscription Options” and 5.3.2.2. “Performance Shares”).
TABLE 1: SUMMARY OF THE COMPENSATION, OPTIONS AND SHARES AWARDED TO EACH EXECUTIVE OFFICER
(in euros)
Charles Edelstenne, Chairman of the Board
Compensation due for the year (detailed in Table 2)
Value of the variable multi-year compensation granted during the year
Value of the stock options granted during the year (detailed in Table 4)
Value of the performance share granted during the year (detailed in Table 6)
Bernard Charlès, Chief Executive Officer
Compensation due for the year (detailed in Table 2)
Value of the variable multi-year compensation granted during the year
Value of the stock options granted during the year (detailed in Table 4)
Value of the performance share granted during the year (detailed in Table 6)
2015
2014
1,025,000
1,024,000
N/A
N/A
N/A
N/A
N/A
N/A
2,887,684(1)
2,365,534
N/A
N/A
N/A
N/A
N/A
N/A
(1) As disclosed on March 24, 2015 in the 2014 Annual Report, the Board of Directors set, at its meeting on March 20, 2015, the total amount of the 2015 annual target compensation
with objectives achieved for the Chief Executive Officer to €2,650,000, half of which will vary in relation to the achievement of the objectives. This revision in the Chief Executive
Officer‘s base compensation was decided in 2015 to take into account the change in the Group’s scope resulting from the multiple acquisitions completed since 2005, the date of
the previous significant revision.
VALUE OF THE SHARES GRANTED TO THE CHIEF EXECUTIVE OFFICER AS PART OF THE PLAN TO PROGRESSIVELY
ASSOCIATE HIM WITH THE COMPANY’S CAPITAL
Such shares are granted to the Chief Executive Officer as part of the gradual process of associating him with the Company’s
capital that began several years ago, with the aim of recognizing his entrepreneurial role during more than thirty years with the
Company and providing him with an equity interest comparable to that of founders of companies in the same sector, and more
generally, of his peers in technology companies around the world.
(in euros)
Bernard Charlès, Chief Executive Officer
Value of the shares granted during the year (see Table 6) (1)
2015
2014
11,653,530(2)
5,620,500(3)
(1) Value based on the method chosen for the consolidated financial statements, before the spreading of the expense and taking into account the performance criteria.
(2) i.e., 300,000 2015-B Shares granted in 2015.
(3) i.e., 300,000 2014-B Shares the 150,000 shares initially granted have been multiplied by 2 following the two-for-one stock split on July 17, 2014 granted in 2014.
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TABLE 2: SUMMARY OF THE COMPENSATION OF EACH EXECUTIVE OFFICER
Gross compensation before tax of the executive officers (dirigeants mandataires sociaux) is set forth in the table below.
(in euros)
Charles Edelstenne, Chairman of the Board
Fixed compensation(1)
Annual variable compensation
Multi-year variable compensation
Extraordinary compensation
Directors’ fees(2)
Benefits(3)
TOTAL
Bernard Charlès, Chief Executive Officer
Fixed compensation
Annual variable compensation(5)
Multi-year variable compensation
Extraordinary compensation
Directors’ fees
Benefits(9)
TOTAL
2015
2014
Amount due in
respect of year
Amount paid
in 2015
Amount due in
respect of year
Amount paid
in 2014
982,000
982,000
982,000
982,000
N/A
N/A
N/A
43,000
N/A
N/A
N/A
N/A
42,000
N/A
N/A
N/A
N/A
42,000
N/A
N/A
N/A
N/A
36,000
N/A
1,025,000
1,024,000
1,024,000
1,018,000
1,325,000(4)
1,523,750(6)
1,325,000(4)
1,269,600(7)
1,058,000
1,058,000
1,269,600(7)
1,178,750(8)
N/A
N/A
28,000
10,934
N/A
N/A
27,000
10,934
N/A
N/A
27,000
10,934
N/A
N/A
21,000
10,934
2,887,684
2,632,534
2,365,534
2,268,684
5
(1) GIMD paid Mr. Charles Edelstenne, as GIMD’s Chief Executive Officer, gross fixed compensation of €800,000 in 2015 and in 2014.
(2) GIMD paid Mr. Charles Edelstenne, for his term as a member of GIMD’s Supervisory Board, directors’ fees of €27,222 in 2015 and €22,719 in 2014.
(3) GIMD granted benefits in kind related to the use of a car for Mr. Charles Edelstenne in an amount of €10,440 in 2015 and €10,063 in 2014.
(4) As disclosed on March 24, 2015 in the 2014 Annual Report, the Board of Directors set, at its meeting on March 20, 2015, the total amount of the 2015 annual target compensation
with objectives achieved for the Chief Executive Officer to €2,650,000, half of which will vary in relation to the achievement of the objectives. This revision in the Chief Executive
Officer‘s base compensation was decided in 2015 to take into account the change in the Group’s scope resulting from the multiple acquisitions completed since 2005, the date of
the previous significant revision. Consequently, in 2015, the fix compensation of the Chief Executive Officer has been raised to 1,325,000 euros, which represent a 25.2% increase
compared to 2014.
(5) The rules governing the determination of variable compensation of the Chief Executive Officer are described in paragraph 5.1.4 “Principles Established by the Board of Directors to
Determine the Compensation of the Company’s Executive Officers and members of the Group’s Executive Committee”.
(6) Variable portion of the compensation due for 2015 and paid in 2016, it being emphasized that the Board of Directors set, at its meeting on March 20, 2015, the total amount of
the 2015 annual target compensation with objectives achieved for the Chief Executive Officer to €2,650,000, half of which will vary in relation to the achievement of the
objectives. This revision in the Chief Executive Officer‘s base compensation was decided in 2015 to take into account the change in the Group’s scope resulting from the multiple
acquisitions completed since 2005, the date of the previous significant revision.
(7) Variable portion due for 2014 and paid in 2015.
(8) Variable portion due for 2013 and paid in 2014.
(9) These benefits are related to the use of a car provided by Dassault Systèmes SE.
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5 Corporate governance
Summary of the Compensation and Benefi ts Due to Corporate Offi cers (mandataires sociaux)
TABLE 3: DIRECTORS’ FEES AND OTHER COMPENSATION RECEIVED BY THE NON-EXECUTIVE DIRECTORS
The directors do not receive any compensation other than the fees set forth in the table below, except for Charles Edelstenne and
Bernard Charlès, whose compensation is set forth in Table 2 above, and Thibault de Tersant, Senior Executive Vice-President and
Chief Financial Officer, whose compensation is set forth in note 1 to the table below.
(in euros)
NON-EXECUTIVE DIRECTORS (MANDATAIRES SOCIAUX NON-DIRIGEANTS)
Directors’ fees paid
in 2015 for 2014
Directors’ fees paid
in 2014 for 2013
Thibault de Tersant(1)
Jean-Pierre Chahid-Nouraï
Nicole Dassault(2)
Serge Dassault (director until May 27, 2014)(3)
Arnoud De Meyer
Odile Desforges
Bernard Dufau(5)
Marie-Hélène Habert (director since July 23, 2014)(4)
André Kudelski(5)
Toshiko Mori
TOTAL
(1) The overall compensation received by Thibault de Tersant in 2015 and 2014 is set out below:
Thibault de Tersant, director, Senior Executive Vice-President and Chief Financial Officer
Fixed Compensation
Annual variable compensation
Multi-year variable compensation
Extraordinary compensation
Directors’ fees
Benefits(c)
TOTAL
27,000
53,000
22,000
10,000
38,000
42,000
–
9,657
–
28,000
229,657
21,000
32,956
16,200
18,600
24,600
14,835
17,408
–
15,164
24,600
185,363
Compensation
paid in 2015
Compensation
paid in 2014
480,000
250,000(a)
–
1,056
27,000
9,865
767,921
450,000
240,000(b)
–
281
21,000
9,838
721,119
(a) Variable portion due for 2014. In 2015, Thibault de Tersant also received €34,582.91 under the Company’s French profit sharing plans.
(b) Variable portion due for 2013. In 2014, Thibault de Tersant also received €33,606 under the Company’s French profit sharing plans.
(c) These benefits are related to the use of a car provided by Dassault Systèmes SE.
(2) GIMD paid Nicole Dassault €14,778 in directors’ fees in 2015 and €19,035 in 2014, in connection with her role as a member of the Supervisory Board of GIMD.
(3) GIMD paid Serge Dassault directors’ fees of €27,222 in 2015 and €26,403 in 2014, in connection with his role as a member of the Supervisory Board of GIMD, €630,000 in 2015
and €600,000 in 2014 in connection with his role as President of GIMD. GIMD also granted benefits in kind related to the use of a car to Mr. Dassault in an amount of €14,448 in
2015 and €16,024 in 2014.
(4) GIMD paid Marie-Hélène Habert directors’ fees of €25,325 in 2015 and €26,403 in 2014, in connection with her role as a member of the Supervisory Board of GIMD, €338,534
in 2015 and €334,584 in 2014 in connection with her role as Director of Communication and Patronage, Dassault Group. GIMD also granted her a bonus in an amount of €5,000
in 2015 and €5,140 in 2014 and benefits in kind related to the use of a car in an amount of €3,550 in 2015 and €3,803 in 2014.
(5) The term of office as directors of Bernard Dufau and André Kudelski ended at the General Meeting of May 30, 2013.
Other elements relating to the compensation of the directors are described in paragraph 5.1.4.4 “Directors’ Fees”.
TABLE 4: SUBSCRIPTION OR PURCHASE OPTIONS GRANTED IN 2015 TO EACH EXECUTIVE OFFICER BY THE ISSUER
AND BY ANY OF THE GROUP COMPANIES
(in euros)
Charles Edelstenne
TOTAL
Bernard Charlès
TOTAL
Plan number
and date
Type of options
(purchase or
subscription)
Value of
the options
Number of
options granted
in 2015
Exercise price
Exercise period
–
–
–
–
–
–
–
–
–
–
–
–
None
None
–
–
–
–
–
–
–
–
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TABLE 5: SUBSCRIPTION OR PURCHASE OPTIONS EXERCISED DURING 2015 BY EACH EXECUTIVE OFFICER
(in euros)
Charles Edelstenne
Bernard Charlès
TOTAL
Plan number
and date
–
2008-01 – 9/25/2008
Number of
options exercised
in 2015*
–
100,000
100,000
Exercise
price*
–
€19.075
*
Since the options exercised during 2015 were issued prior to the two-for-one stock split of the Dassault Systèmes share on July 17, 2014, the numbers listed in these columns take
into account the correlative multiplication of the number of shares subscribed and the division in half of the exercise price.
Mr. Bernard Charlès generally reinvests the gains realized through the exercise of subscription stock options in shares of Dassault
Systèmes SE, after accounting for taxes, social charges and transaction fees. In 2015, Mr. Bernard Charlès did not sell any
Dassault Systèmes shares.
TABLE 6: SHARES GRANTED IN 2015 TO EACH EXECUTIVE OFFICER BY THE ISSUER AND
BY ANY OF THE GROUP COMPANIES
Charles Edelstenne
Bernard Charlès
TOTAL
Number of shares
authorized and issued
performance shares
granted in 2015
Value of
the shares
(in euros) (1)
Date of
acquisition
Date of
availability
Performance
conditions
None
–
–
–
300,000(2)
€11,653,530
9/4/2017
9/4/2017
–
Yes
5
Plan number
and date
–
2015-B
9/4/2015
300,000
(1) Value based on the method chosen for the consolidated financial statements before the spreading of the expense and taking into account the performance criteria.
(2) Such shares are granted to the Chief Executive Officer as part of the gradual process of associating him with the Company’s capital that began several years ago, with the aim of
recognizing his entrepreneurial role during more than thirty years with the Company and providing him with an equity interest comparable to that of founders of companies in the
same sector, and more generally, of his peers in technology companies around the world.
TABLE 7: SHARES THAT HAVE BECOME AVAILABLE DURING 2015 FOR EACH EXECUTIVE OFFICER
Charles Edelstenne
Bernard Charlès
TOTAL
Plan number and date
No. 2010-03
9/29/2011
Number of shares
authorized and
issued that became
available in 2015
–
300,000(2)
300,000
Vesting conditions(1)
(1) The Board of Directors did not set any quantity of shares to be vested at the date of the availability of the shares granted. See also explanation in paragraph 5.1.5 “Application of
the AFEP-MEDEF Code”.
(2) Such shares are granted to the Chief Executive Officer as part of the gradual process of associating him with the Company’s capital that began several years ago, with the aim of
recognizing his entrepreneurial role during more than thirty years with the Company and providing him with an equity interest comparable to that of founders of companies in the
same sector, and more generally, of his peers in technology companies around the world. In accordance with the law, a part of these shares is subject to a holding period (see
paragraph 5.1.4.3 “Performance Shares and Share Subscription Options”). Such 300,000 shares reflect the two-for-one split of the Dassault Systèmes share effective on July 17,
2014 and the correlative multiplication of the number of shares that became available.
TABLE 8: GRANTS OF SHARE SUBSCRIPTION OR PURCHASE OPTIONS
See paragraph 5.3.2.1 “Dassault Systèmes Subscription Options” below.
TABLE 9: SHARE SUBSCRIPTION OPTIONS GRANTED TO THE TOP TEN EMPLOYEES WHO ARE NOT EXECUTIVE DIRECTORS
AND WHO RECEIVED THE MOST SHARE SUBSCRIPTION OPTIONS, AND OPTIONS EXERCISED BY THESE EMPLOYEES
See paragraph 5.3.2.1 “Dassault Systèmes Subscription Options” below.
TABLE 10: HISTORY OF THE PERFORMANCE SHARES GRANTED
See paragraphs 5.3.2.2 “Performance shares” below.
DASSAULT SYSTÈMES DOCUMENT DE RÉFÉRENCE 2015 175
5 Corporate governance
Summary of the Compensation and Benefi ts Due to Corporate Offi cers (mandataires sociaux)
TABLE 11: FOLLOW-UP OF THE AFEP-MEDEF’S RECOMMENDATIONS
As indicated in the table below, Dassault Systèmes SE complies with the main recommendations of the AFEP-MEDEF Code
regarding compensation and benefits granted to executive officers (dirigeants mandataires sociaux).
Employment
agreement
Additional
retirement plan
Indemnities or benefits
due or which may become
due in the event of
termination of or change
in present functions
Indemnities related
to a non-competition
clause
Executive officers
Charles Edelstenne
Chairman of the Board
Director since (1st appointment): 04/08/1993
Term: until the annual General Meeting to be
held in 2018
Bernard Charlès
Chief Executive Officer
Director since (1st appointment): 04/08/1993
Term: until the annual General Meeting to be
held in 2018
Yes
No
X
X
Yes
No
X
Yes
Yes
No
X
X
X*
No
X
X
*
The conditions for payment and the amount of the indemnities owed are described in paragraph 5.1.4.2 “Indemnities Due in the Event of the Imposed Departure (départ contraint)
of the Chief Executive Officer”.
There is no specific additional retirement plan (régime
complémentaire de retraite) for the executive officers. The
companies controlled by Dassault Systèmes SE have not
paid any compensation or granted any other benefits to the
executive officers (dirigeants mandataires sociaux) mentioned
above.
5.3.2
Interests of Executive Management and Employees
in the Share Capital of Dassault Systèmes SE
5.3.2.1 Dassault Systèmes Share Subscription
Options
As of December 31, 2015, there were four active shares
subscription options plans for the benefit of certain Company
managers and employees. One share subscription options plan
expired during 2015. The exercise price of share subscription
options granted pursuant to all the plans was fixed without a
discount compared to the most recent price of the Dassault
Systèmes share on the date of grant of the options.
The General Meeting on May 30, 2013 authorized the Board
of Directors to grant options to subscribe or to purchase
Company shares for a period of 38 months, provided that the
total of all outstanding stock options does not give a right to
more than 5% of Dassault Systèmes SE’s share capital. At its
meeting on September 4, 2015, the Board of Directors used
this authorization to grant to 600 beneficiaries 1,965,555
share subscription options (the “2015-01 Options”), the
exercise of which is subject to a performance condition.
The new shares created by the exercise of options between
January 1 and the date of the Annual General Meeting
deciding on the allocation of profit related to the most recently
completed financial year are entitled to receive the dividend
distributed with respect to that year. As a result, the new
shares are traded on the same line as the previously existing
shares.
However, the new shares created as from the day after this
A nnual General Meeting do not have a right to receive this
dividend. Those shares are temporarily quoted on a second
trading line until the date the shares trade ex-dividend (i.e.,
without the right to receive the dividend to be distributed on
Dassault Systèmes shares).
The following table provides certain information on the stock
options plans in effect during 2015.
176 DOCUMENT DE RÉFÉRENCE 2015 DASSAULT SYSTÈMES
Corporate governance
Summary of the Compensation and Benefi ts Due to Corporate Offi cers (mandataires sociaux)
5
GRANTS OF SUBSCRIPTION OR PURCHASE OPTIONS
(Corresponding to Table 8 of the AMF Position-Recommendation No. 2009-16)
For all the grants prior July 17, 2014, the figures in this table (options, shares and exercise price) reflect the two-for-one split of the
Dassault Systèmes share effective on July 17, 2014 and the correlative multiplication of the number of shares that may be exercised.
Stock option plan
General Meeting
Board of Directors
Total Number of shares to be
subscribed pursuant to options
exercise
(cid:125) by corporate officers
(mandataires sociaux)
Charles Edelstenne
Bernard Charlès
Thibault de Tersant
Starting point for exercising
the options
Expiry date
Exercise price (in euros)
Modalities of exercise
Number of shares subscribed
pursuant to options exercised
as of 12/31/2015
Cumulative number of options
canceled or null and void
as of 12/31/2015
Number of options outstanding
as of 12/31/2015
Number of shares subscribed
pursuant to options exercised
between 01/01/2016
and 02/29/2016
Number of options canceled
or null and void between 01/01/16
and 02/29/2016
Number of options outstanding
as of 2/29/2016
Number of shares subscribed
pursuant to options exercised
as of 02/29/2016
2008-01
2008-02
2010-01
2014-01
2015-01
Total
05/22/2008
05/22/2008
05/27/2010
05/30/2013
05/30/2013
09/25/2008
11/27/2009
05/27/2010
05/26/2014
09/4/2015
2,873,200
3,703,000
2,480,000
624,450
1,965,555
11,646,205
300,000
340,000
220,000
N/A
100,000
200,000
N/A
N/A
100,000(1)
100,000(1)
240,000
120,000
–
N/A
N/A
–
–
N/A
N/A
N/A
860,000
N/A
300,000
560,000
09/25/2009
11/27/2013
05/27/2014
02/21/2016
09/4/2016
09/24/2015
11/26/2017
05/26/2018
05/25/2022
09/3/2025
19.075
19.50
23.50
45.50
62.00
See note(2)
See note(3)
5
2,596,836
1,937,736
821,723
-
-
5,356,295
276,364
310,000
206,700
160,600
24,150
977,814
-
-
-
-
1,455,264
1,451,577
463,850
1,941,405
5,312,096
52,702
78,430
5,030
-
136,162
-
-
64,390
46,550
110,940
1,402,562
1,373,147
394,430
1,894,855
5,064,994
2,596,836
1,990,438
900,153
5,030
-
5,492,457
(1) The options granted to the Chief Executive Officer are subject to performance conditions related to his variable compensation actually paid out over three years, the amount of
which is itself dependant upon the satisfaction of the performance criteria defined by the Board of Diretors of Dassault Systèmes SE.
(2) The 2014-01 options are exercisable by one-third tranches as from February 21, 2016, February 21, 2017 and February 21, 2018, respectively, provided that the beneficiary
remains with the Company and fulfills the performance conditions related to the target for his or her respective brand.
(3) The 2015-01 options are exercisable by one-third tranches as from September 4, 2016, September 2017 and September 2018, respectively, provided that the beneficiary remains
with the Company and fulfills the performance condition relating to the diluted net profit per share on a non-IFRS consolidated basis (hereinafter referred to as the “EPS”), and/or
the achievement of the target for his or her respective brand.
For information regarding the dilutive effect on share capital
by the exercise of options, see also paragraph 6.2.1 “Share
Capital at February 29, 2016”.
At December 31, 2015, the only corporate officers
(mandataires sociaux) owning such share subscription options
were Bernard Charlès and Thibault de Tersant.
For information regarding the equity interests in Dassault
Systèmes SE of the corporate officers (mandataires sociaux),
see paragraphs 5.1.1 “Composition and Practices of the Board
of Directors” and 6.3 “Information about the Shareholders” in
this Annual Report (Document de référence).
DASSAULT SYSTÈMES DOCUMENT DE RÉFÉRENCE 2015 177
5 Corporate governance
Summary of the Compensation and Benefi ts Due to Corporate Offi cers (mandataires sociaux)
SUBSCRIPTION AND PURCHASE OPTIONS OF THE TOP TEN EMPLOYEES WHO ARE NOT EXECUTIVE OFFICERS AND
THE OPTIONS THEY EXERCISED DURING 2015
(Corresponding to Table 9 of the AMF Position-Recommendation No. 2009-16)
The following table sets forth, on a global basis, the total number and weighted average exercise price of shares subscribed by the
ten Company employees who exercised the largest number of Dassault Systèmes SE stock options during 2015 and who are not
corporate officers (mandataires sociaux) of the Dassault Systèmes SE.
Stock options granted in 2015
to the ten employees who received
the largest number of stock options
Stock options exercised in 2015
by the ten employees who exercised
the largest number of stock options*
Total of
options
Average
weighted price
per option
Plan.
2008-01
Plan.
2008-02
Plan.
2010-01
Plan. 2014-01
Plan. 2015-01
326,500
€62.00
–
–
–
381,695
€40.20
199,900
103,300
78,495
–
–
326,500
–
*
For all the grants prior July 17, 2014, the figures in this table (options and exercise price) reflect the two-for-one split of the Dassault Systèmes share effective on July 17, 2014
and the correlative multiplication of the number of shares that may be exercised.
5.3.2.2
Performance shares
The General Meeting of September 4, 2015 authorized
the Board of Directors to grant Dassault Systèmes shares,
representing up to 2% of Dassault Systèmes SE’s capital at
the date the Board of Directors granted them (i.e., 5,123,341
shares), this authorization being valid during a 38-month
period.
The Board meeting of September 4, 2015 used this
authorization to grant 734,600 “2015-A” performance shares
to 570 beneficiaries, and 300,000 “2015-B” shares to the
Chief Executive Officer (see paragraph 5.1.4.3 “Performance
Shares and Share Subscription Options”). This second grant is
compliant with the resolution of the General Meeting, which
limited the portion of shares that could be granted to the Chief
Executive Officer to 35% of the overall amount of shares as of
the date of the grant, i.e., 1,793,169 shares.
178 DOCUMENT DE RÉFÉRENCE 2015 DASSAULT SYSTÈMES
Corporate governance
Summary of the Compensation and Benefi ts Due to Corporate Offi cers (mandataires sociaux)
5
HISTORY OF PERFORMANCE SHARES GRANTED
(Corresponding to Table 10 of the AMF Position-Recommendation No. 2009-16)
For all the grants prior July 17, 2014, the figures in this table reflect the two-for-one split of the Dassault Systèmes share effective
on July 17, 2014 and the correlative multiplication of the number of shares.
Plan Number
General Meeting
2010-02
– France Plan
2010-02
– International
Plan
2010-04
– France Plan
2010-04
– International
Plan
2014-A
2015-A
Total
05/27/2010
05/27/2010
05/27/2010
05/27/2010
05/30/2013
09/04/2015
Date of the Board meeting
09/29/2011
09/29/2011
09/07/2012
09/07/2012
02/21/2014
09/04/2015
Total number of shares
granted, including the
number granted to:
(cid:125) to corporate officers
(mandataires sociaux)
Charles Edelstenne
Bernard Charlès
Thibault de Tersant
621,000(1)
191,800(1)
661,600(1)
416,860(1)
1,059,880
734,600
3,685,740
62,000
–
28,000(2)
34,000
–
–
–
62,000
–
28,000(2)
34,000
–
–
–
–
40,000
40,000
204,000
–
–
–
–
40,000
40,000
–
56,000(2)
148,000
Vesting date of shares
09/29/2014
09/29/2015
09/07/2015
09/07/2016
02/21/2018
09/04/2017
Date of end of holding period
09/29/2016
none
09/07/2017
Yes(3)
Yes(3)
Yes(4)
588,000
152,300
622,000
none
Yes(4)
–
none
Yes(5)
–
none
Yes(6)
5
–
1,362,300
33,000
39,500
39,600
76,300
60,750
900
250,050
-
-
-
340,560
999,130
733,700
2,073,390
(1) In the event of international mobility, the beneficiaries of the France Plan may be transferred under certain conditions to the International Plan and vice versa during the vesting
period. Therefore, the total number of vested shares under the France or International Plans may differ from the number of shares originally granted under these plans.
(2) The shares granted to the Chief Executive Officer are subject to an additional performance condition in relation to his variable compensation actually paid with respect to three
financial years set forth in the regulations of the plan in question, the amount of which is itself dependent on achieving performance criteria previously established by the Board
of Directors of Dassault Systèmes SE.
(3) The 2010-02 Shares will be fully vested at the end of the vesting period applicable to the beneficiary, provided the beneficiary remains with the Company and satisfies a
performance condition, which is measured according to the EPS actually realized compared to the high end of the range EPS as published for each of the 2011, 2012 and 2013
financial years.
(4) The 2010-04 Shares will be fully vested at the end of the vesting period applicable to the beneficiary, provided the beneficiary remains with the Company and satisfies a
performance condition, which is measured according to the EPS actually realized compared to the high end of the range EPS as published for each of the 2012, 2013 and 2014
financial years.
(5) The 2014-A Shares will be fully vested at the end of the vesting period, provided the beneficiary remains with the Company and fulfils each year over a three-year period at least
one of the following performance conditions: growth in the EPS compared to 2014, and such growth must be at least equal to a threshold (expressed as a percentage) established
at the Board meeting at which the shares were granted, or outperformance of the Dassault Systèmes share compared to the performance of the CAC 40 index; and this difference
must be at least equal to a threshold (expressed as a percentage) established at the same Board meeting.
(6) The 2015-A Shares will be fully vested at the end of the vesting period, provided that the beneficiary remains with the Company and fulfills at least one of the following
performance conditions whose achievement will be measured in 2017: growth in the EPS compared to 2014, and such growth must be at least equal to a threshold (expressed as
a percentage) established at the Board meeting at which the shares were granted, or outperformance of the Dassault Systèmes share compared to the performance of the CAC 40
index; and this difference must be at least equal to a threshold (expressed as a percentage) established at the same Board meeting.
DASSAULT SYSTÈMES DOCUMENT DE RÉFÉRENCE 2015 179
Performance conditions
Number of shares vested
as at 02/29/2016
Total number of shares
cancelled or lapsed
as at 12/31/2015
Performance shares
remaining at the end
of financial year
5 Corporate governance
Summary of the Compensation and Benefi ts Due to Corporate Offi cers (mandataires sociaux)
HISTORY OF THE SHARES GRANTS TO THE CHIEF EXECUTIVE OFFICER IN RESPECT OF THE GRADUAL PROCESS
OF ASSOCIATING THE CHIEF EXECUTIVE OFFICER WITH THE COMPANY SHARE CAPITAL
(See also paragraph 5.1.4.3 “Performance Shares and Share Subscription Options”)
The figures in this table reflect the two-for-one split of the Dassault Systèmes share effective on July 17, 2014 and the correlative
multiplication of the number of shares .
Plan Details
General Meeting
Board of Directors
2009
2010
2010-03
2010-05
2014-B
2015-B
06/06/2007 05/27/2010 05/27/2010 05/27/2010 05/30/2013 09/04/2015
11/27/2009 05/27/2010 09/29/2011 09/07/2012 02/21/2014 09/04/2015
Total number of shares granted to Bernard Charlès
300,000
300,000
300,000
300,000
300,000
300,000
Vesting date of shares
11/27/2011 05/27/2012 09/29/2013 09/07/2014 02/21/2018 09/04/2017
Date of end of holding period (1)
11/27/2013 05/27/2014 09/29/2015 09/07/2016 02/21/2018 09/04/2017
Performance conditions
See note (2)
See note (3)
See note (4)
See note (5)
See note (6)
See note (7)
Number of shares vested as at 3/20/2016
300,000
300,000
300,000
300,000
–
–
(1) Non applicable to the shares subject to the legal lock-up commitment set by the Board of Directors (see paragraph 5.1.4.3 “Performance Shares and Shares Subscription Options”).
(2) Performance condition related to variable compensation actually paid to the Chief Executive Officer with respect to the 2009 and 2010 financial years, the amount of which is itself
dependent on achieving performance criteria previously established by the Board.
(3) Performance condition related to variable compensation actually paid to the Chief Executive Officer with respect to the 2010 and 2011 financial years, the amount of which is itself
dependent on achieving performance criteria previously established by the Board.
(4) Performance condition related to variable compensation actually paid to the Chief Executive Officer with respect to the 2011 and 2012 financial years, the amount of which is itself
dependent on achieving performance criteria previously established by the Board.
(5) Performance condition related to variable compensation actually paid to the Chief Executive Officer with respect to the 2012 and 2013 financial years, the amount of which is itself
dependent on achieving performance criteria previously established by the Board.
(6) The same performance condition as that stipulated for the 2014-A performance shares granted by the Board on the same day to certain employees of the Group.
(7) Performance condition (i) identical to the one stipulated for the 2015-A performance shares and (ii) an additional condition tied to the variable compensation of the Chief Executive
Officer actually paid over the life of the plan, the amount of which is itself dependent on the achievement of performance criteria previously established by the Board meeting that
set his compensation (see paragraph 5.1.4.3 “Performance Shares and Share Subscription Options”).
180 DOCUMENT DE RÉFÉRENCE 2015 DASSAULT SYSTÈMES
Corporate governance
Transactions in the Company’s Shares by the Management of the Company
5
5.4 Transactions in the Company’s Shares
by the Management of the Company
Pursuant to Article 223-26 of the AMF’s General Regulations, the table below shows transactions involving securities issued
by Dassault Systèmes SE carried out in 2015 by directors or executive officers of the Company, or by persons related to them
(according to Article R. 621-43-1 of the French Monetary and Financial Code), on the basis of the declarations made by the
relevent parties to the AMF, available on www.amf-france.org.
Date and place Directors and Executive Officers
Nature of the transaction
Unit price
(in euros)
Gross amount
(in euros)
02/10/15
Euronext Paris Philippe Forestier
02/10/15
Euronext Paris Philippe Forestier
02/10/15
Euronext Paris Thibault de Tersant
02/10/15
Euronext Paris Thibault de Tersant
02/10/15
Euronext Paris Thibault de Tersant
02/10/15
Euronext Paris Thibault de Tersant
02/26/15
Euronext Paris Bruno Latchague
02/26/15
Euronext Paris Bruno Latchague
04/28/15
Euronext Paris Thibault de Tersant
04/28/15
Euronext Paris Thibault de Tersant
05/04/15
Euronext Paris Bruno Latchague
05/04/15
Euronext Paris Bruno Latchague
05/05/15
Euronext Paris Bruno Latchague
05/05/15
Euronext Paris Bruno Latchague
05/19/15
Euronext Paris Philippe Forestier
05/19/15
Euronext Paris Philippe Forestier
06/01/15
Euronext Paris Pascal Daloz
06/01/15
Euronext Paris Monica Menghini
06/01/15
Euronext Paris Monica Menghini
06/01/15
Euronext Paris Monica Menghini
06/01/15
Euronext Paris Monica Menghini
Exercise of share subscription options
19.08
190,750.00
Sale of shares
57.68
576,782.40
Exercise of share subscription options
19.08
45,780.00
Exercise of share subscription options
19.50
928,200.00
5
Sale of shares
Sale of shares
57.57
138,171.58
57.54 2,738,791.68
Exercise of share subscription options
23.50
940,000.00
Sale of shares
62.16 2,486,367.89
Exercise of share subscription options
19.50 1,170,000.00
Sale of shares
69.92 4,195,199.35
Exercise of share subscription options
23.50
785,910.50
Sale of shares
69.77 2,333,203.82
Exercise of share subscription options
23.50
118,722.00
Sale of shares
69.72
352,204.43
Exercise of share subscription options
19.50
195,000.00
Sale of shares
70.29
702,942.00
Exercise of share subscription options
19.08
138,770.63
Exercise of share subscription options
19.50
156,000.00
Exercise of share subscription options
23.50
188,000.00
Sale of shares
Sale of shares
70.40
563,200.00
70,40
563,200.00
DASSAULT SYSTÈMES DOCUMENT DE RÉFÉRENCE 2015 181
5 Corporate governance
Transactions in the Company’s Shares by the Management of the Company
Date and place Directors and Executive Officers
Nature of the transaction
Unit price
(in euros)
Gross amount
(in euros)
06/04/15
Euronext Paris Pascal Daloz
06/04/15
Euronext Paris Pascal Daloz
06/17/15
Euronext Paris Thibault de Tersant
06/25/15
Euronext Paris Bernard Charlès
06/25/15
Euronext Paris Pascal Daloz
06/25/15
Euronext Paris Thibault de Tersant
06/25/15
Euronext Paris Jean-Pierre Chahid-Nouraï
06/25/15
Euronext
06/25/15
Euronext
06/25/15
Euronext
06/25/15
Euronext
06/25/15
Euronext
06/25/15
Euronext
06/25/15
Euronext
06/25/15
Euronext
06/25/15
Euronext
06/25/15
Euronext
06/25/15
Euronext
06/25/15
Euronext
06/25/15
Euronext
Charles Edelstenne
Physical person associated
with Charles Edelstenne
Legal person associated
with Charles Edelstenne
Legal person associated
with Charles Edelstenne
Bernard Charlès
Bernard Charlès
Bernard Charlès
Bernard Charlès
Bernard Charlès
Bernard Charlès
Physical person associated
with Bernard Charlès
Physical person associated
with Bernard Charlès
07/30/15
Euronext Paris Thibault de Tersant
07/30/15
Euronext Paris Thibault de Tersant
08/26/15
Euronext
08/28/15
Euronext
09/02/15
Euronext
09/04/15
Euronext
Physical person associated
with Nicole Dassault
Physical person associated
with Nicole Dassault
Physical person associated
with Nicole Dassault
Physical person associated
with Nicole Dassault
09/16/15
Euronext Paris Bernard Charlès
182 DOCUMENT DE RÉFÉRENCE 2015 DASSAULT SYSTÈMES
Exercise of share subscription options
19.08 1,386,752.50
Exercise of share subscription options
19.08
476.88
Exercise of share subscription options
19.50
214,500.00
Reinvestment of dividends in shares
69.43
508,852.47
Reinvestment of dividends in shares
69.43
9,303.62
Reinvestment of dividends in shares
69.43
22,287.03
Reinvestment of dividends in shares
69.43
555.44
Reinvestment of dividends in shares
69.43 1,364,021.78
Reinvestment of dividends in shares
69.43 2,492,120.42
Reinvestment of dividends in shares
69.43
763.73
Reinvestment of dividends in shares
69.43
763.73
Reinvestment of dividends in shares
69.43
75,817.56
Reinvestment of dividends in shares
69.43
14,649.73
Reinvestment of dividends in shares
69.43
1,666.32
Reinvestment of dividends in shares
69.43
81,857.97
Reinvestment of dividends in shares
69.43
69.43
Reinvestment of dividends in shares
69.43
67,694.25
Reinvestment of dividends in shares
69.43
62,278.71
Reinvestment of dividends in shares
69.43
347.15
Exercise of share subscription options
19.50 1,170,000.00
Sale of shares
Acquisition of shares
Acquisition of shares
Acquisition of shares
Acquisition of shares
68.95 4,137,067.03
61.31 6,130,570.00
61.87 4,083,347.40
61.16 6,054,998.40
61.05 3,968,211.00
Exercise of share subscription options
19.08 1,907,500.00
Bernard Charlès
Reinvestment of dividends in shares
69.43
416.58
Corporate governance
Transactions in the Company’s Shares by the Management of the Company
5
Date and place Directors and Executive Officers
Nature of the transaction
Unit price
(in euros)
Gross amount
(in euros)
09/23/15
Euronext Paris Dominique Florack
09/29/15
Euronext Paris Bruno Latchague
10/28/15
Euronext Paris Thibault de Tersant
10/28/15
Euronext Paris Thibault de Tersant
Exercise of share subscription options
19.08 4,394,727.40
Sale of shares
64.61 1,938,225.00
Exercise of share subscription options
19.50 1,170,000.00
Sale of shares
69.69 4,181,283.84
5
DASSAULT SYSTÈMES DOCUMENT DE RÉFÉRENCE 2015 183
5 Corporate governance
Statutory Auditors
5.5 Statutory Auditors
Principal Statutory Auditors
PricewaterhouseCoopers Audit, member of the Compagnie
Régionale des Commissaires aux Comptes de Versailles, 63,
rue de Villiers – 92200 Neuilly-sur-Seine, represented by
Pierre Marty, whose first mandate began on June 8, 2005
and was renewed on May 26, 2011 for a period of six fiscal
years expiring at the General Meeting of Shareholders
approving the financial statements for the fiscal year ending
on December 31, 2016.
Ernst & Young et Autres, member of the Compagnie Régionale
des Commissaires aux Comptes de Versailles, 1/2, place des
Saisons – 92400 Courbevoie – Paris-La Défense 1, represented
by Pierre-Antoine Duffaud, was appointed on May 27, 2010
to replace Ernst & Young Audit; this mandate will expire at
the General Meeting of Shareholders approving the financial
statements for the fiscal year ending on December 31, 2015.
It will be proposed to the General Meeting of May 26, 2016
to renew Ernst & Young et Autres’ mandate, for a six fiscal
year period. This mandate will expire at the General Meeting
approving the financial statements for the year ending on
December 31, 2021.
Deputy Statutory Auditors
Yves Nicolas, 63, rue de Villiers – 92200 Neuilly-sur-Seine,
whose mandate began on May 26, 2011 for a period of six
fiscal years expiring at the General Meeting of Shareholders
approving the financial statements for the fiscal year ending
on December 31, 2016.
The company Auditex, 1/2, place des Saisons –
92400 Courbevoie – Paris-La Défense 1, whose mandate
was renewed on May 27, 2010 and will expire at the General
Meeting of Shareholders approving the financial statements
for the fiscal year ending on December 31, 2015.
It will be proposed to the General Meeting of May 26, 2016
to renew Auditex mandate, for a six fiscal year period. This
mandate will expire at the General Meeting approving the
financial statements for the year ending on December 31,
2021.
Principal Auditors’ fees and services
The following table presents the amount of fees paid to each of the Company’s principal Statutory Auditors in 2015 and 2014:
(in thousands, excluding VAT)
2015
2014
2015
2014
2015
2014
2015
2014
PricewaterhouseCoopers Audit
Ernst & Young et Autres
Amount
%
Amount
%
Audit
Audit opinion, review of statutory
and consolidated financial statements (1):
(cid:125) issuer
(cid:125) other consolidated subsidiaries
Other audit-related services (2):
(cid:125) issuer
(cid:125) other consolidated subsidiaries
SUBTOTAL
Other services(3)
Legal, tax, social
SUBTOTAL
TOTAL
€1,013
€1,065
1,636
1,390
-
339
2,988
139
139
512
167
3,134
136
136
32%
53%
0%
11%
96%
4%
4%
33%
42%
16%
5%
96%
4%
4%
€229
474
€228
342
54
227
984
901
901
49
1
620
717
717
12 %
25 %
3 %
12 %
52 %
48 %
48 %
17%
25%
4%
0%
46%
54%
54%
€3,127
€3,270
100%
100%
€1,885
€1,337
100%
100%
(1) Audit fees consist of fees billed for the annual audit services engagement and other audit services for the years ended December 31, 2015 and 2014, which are those services that
only the Statutory Auditor reasonably can provide, and include the Group audit, statutory audits, consents, attest services, and services provided in connection with documents
filed with the AMF.
(2) Audit-related fees generally consist of fees billed for assurance and related services that are reasonably related to the performance of the audit or review of the Company’s financial
statements or that are traditionally performed by the Statutory Auditor, and include due diligence services related to acquisitions, consultations concerning financial accounting
and reporting standards, attestation services not required by statute or regulation, and information system reviews. In 2015 and 2014, they primarily included fees related to
certain acquisitions.
(3) Fees billed by members of the Statutory Auditors’ respective networks to consolidated subsidiaries are related to the support in the execution of software licensing reviews and to
local and international tax compliance services, including the review of tax returns and tax services regarding statutory, regulatory or administrative developments and expatriate
tax assistance and compliance.
184 DOCUMENT DE RÉFÉRENCE 2015 DASSAULT SYSTÈMES
6
INFORMATION ABOUT
DASSAULT SYSTÈMES SE,
THE SHARE CAPITAL AND
THE OWNERSHIP STRUCTURE
CONTENTS
6.1 Information about Dassault
6.3 Information about the Shareholders 194
Systèmes SE
6.1.1 General Information
6.1.2 Memorandum and Specific By-Laws Provisions
186
186
187
6.3.1 Shareholder Base and Double Voting Rights
6.3.2 Controlling Shareholder
6.3.3 Shareholder Agreements
194
196
197
6.2 Information about the Share Capital 189
6.4 Stock Market Information
199
6.2.1 Share Capital at February 29, 2016
6.2.2 Potential Share Capital
6.2.3 Changes in Dassault Systèmes SE Share Capital
over the Past Three Years
6.2.4 Delegations and Authorizations Granted
to the Board of Directors by the General Meeting
6.2.5 Stock Repurchase Programs
189
189
190
191
193
DASSAULT SYSTÈMES ANNUAL REPORT 2015
185
6 Information about Dassault Systèmes SE, the share capital and the ownership structure
Information about Dassault Systèmes SE
6.1
Information about Dassault Systèmes SE
6.1.1 General Information
6.1.1.1
Commercial Name and Registered
Offi ce
Dassault Systèmes
10, rue Marcel Dassault – 78140 Vélizy-Villacoublay, France
Telephone: +33 (0)1 61 62 61 62
6.1.1.2
Legal form – Applicable Law –
Place of Registration and Registration
Number – APE code
Dassault Systèmes SE is a European company (Societas
Europaea) incorporated and registered under French law,
governed by the provisions of Council Regulation (EC)
no. 2157/2001 as well as by French provisions in force at
any time (hereinafter the “Law”). The Company is registered
with the Versailles trade and companies registry under
number 322 306 440. The Company’s APE code is 5829 C.
The conversion of Dassault Systèmes SA into a European
company was approved by the General Meeting on May 28,
2015 and became effective on June 15, 2015, the date on
which Dassault Systèmes SE was registered with the Versailles
trade and companies registry.
Dassault Systèmes SE is governed by a Board of Directors.
6.1.1.3 Date of Incorporation and Term
Dassault Systèmes SE was incorporated as a limited liability
company (société à responsabilité limitée) on June 9, 1981 for
a 99-year term starting on the date of its registration (until
August 4, 2080). The Company was transformed into a public
limited liability company (société anonyme) on April 8, 1993
and then into a European company (Societas Europaea) on
June 15, 2015.
6.1.1.4
Corporate Purpose
Pursuant to Article 2 of the Company’s by-laws, as amended
by the Extraordinary General Meeting on September 4, 2015,
Dassault Systèmes SE’s corporate purpose, in France and
abroad, is:
(cid:125) the conception, development, production, marketing,
purchase, sale, brokerage, rental, maintenance and the
provision of after-sale services of software, digital content
and/or computer hardware;
(cid:125) the supply and providing of services of data centers,
including the supply of online software services as a
service and the operation and supply of the corresponding
infrastructures;
186 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
(cid:125) the supply and providing of services to users notably in the
area of training, demonstration, methodology, display and
utilization; and
(cid:125) the supply and sale of computer resources, together or
separate from the supply or sale of software or services,
notably in the areas of 3D design, solutions, modeling,
simulation, manufacturing, operations planning, collaboration,
lifecycle management, business intelligence, marketing or 3D
for public at large in the domains of products, nature and life.
The purpose of the Company shall also be:
(cid:125) the creation, acquisition,
rental and management-
lease of any on-going business, signing leases, and the
establishment and operation of any facilities;
(cid:125) the acquisition, operation or sale of any industrial or
intellectual property rights as well as any knowhow in the
field of computers; and
(cid:125) more generally, taking an interest in any business or
company created or to be created as well as in any legal,
economic, financial, industrial, civil commercial, personal or
real property enterprise connected directly or indirectly, in
whole or in part, with the purposes above or any similar or
related purposes.
6.1.1.5
Fiscal Year
The 12-month fiscal year covers the period from January 1st to
December 31st of each year.
6.1.1.6 Documents on Display
Dassault Systèmes SE’s by-laws, minutes of the General
Meetings and Board of Directors’ reports to the General
Meetings, reports of the Statutory Auditors, financial
statements for the last three years and, more generally,
all documents provided or made available to shareholders
pursuant to the L aw may be viewed at Dassault Systèmes SE’s
registered office.
Some of these documents are also available on the Group’s
website (www.3ds.com/investors/regulated-information).
Information about Dassault Systèmes SE, the share capital and the ownership structure
Information about Dassault Systèmes SE
6
6.1.2 Memorandum and Specifi c By-Laws Provisions
Dassault Systèmes SE’s by-laws were modified twice during
the financial year ended December 31, 2015.
6.1.2.2 General Meetings
The first amendment was introduced following the approval
of the conversion of Dassault Systèmes SA into a European
company by the General Meeting on May 28, 2015. The second
amendment related to the modification of Dassault Systèmes
SE’s corporate purpose (Article 2), which was approved by the
Extraordinary General Meeting on September 4, 2015.
6.1.2.1 Allocation of Profi ts
(Article 36 of the Company’s By-Laws)
The profits for each year, less any losses from prior periods,
where appropriate, are first allocated to the reserves as required
by Law. A sum of 5% is deducted to form the legal reserve
fund. This deduction ceases to be compulsory when said fund
reaches one-tenth of share capital; it becomes compulsory
once again when the legal reserve falls below this amount.
The distributable profit is composed of the profit from the
year less any losses from prior periods as well as the amounts
allocated to reserves as required by Law or the Company’s by-
laws, and increased by retained profits.
The General Meeting then deducts from this distributable
profit the amounts deemed appropriate to allocate to any
optional, ordinary or special reserves or to the retained
earnings account.
As appropriate, any remaining balance is distributed to all
shares proportionately to the unredeemed paid-up value.
However, except in the event of a share capital reduction, no
distribution can be made to shareholders if the equity is, or
would be as a result of the distribution, less than the amount
of the share capital plus the reserves that cannot be distributed
under the law or the by-laws.
The General Meeting may decide to distribute amounts taken
from available reserves, either to pay or increase a dividend,
or distribute a special dividend. In this case, the resolution
explicitly identifies from which reserves these amounts are
to be withdrawn. Nevertheless, the dividends are distributed
in order of priority starting with the distributable profit of
the year.
After the approval of the financial statements by the General
Meeting, any losses are recorded in a special account and
carried forward against the profits of future years, until they
have been eliminated.
In case of stripping of the ownership of the shares, Article 11
of the by-laws reserves for beneficial owners the right to
vote on decisions relating to the allocation of profits (see
paragraph 6.1.2.3 “Shares and Voting Rights” below).
Notice and agenda of meeting
(Articles 25 and 26 of the Company’s by-laws)
General Meetings are convened by the Board of Directors or,
if the Board of Directors fails to convene a General Meeting,
by the Statutory Auditor(s). One or more shareholders who
together hold at least 10% of the subscribed capital may also
(i) request the Board of Directors to call and (ii) set the agenda
of such General Meetings. The request to convene the meeting
shall set out the items to be put on the agenda.
Notice of the meeting is made through an announcement
placed in a journal of legal notices in the department of the
registered office, and in the French Bulletin of required legal
notices (Bulletin des Annonces Légales Obligatoires – BALO).
Shareholders holding registered shares for at least one month
from the date of the announcement are also notified of all
General Meetings by letter sent by standard mail or, at their
request and expense, by registered letter. The General Meeting
cannot be held less than 15 days after the announcement is
published or the letter is sent to registered holders.
One or more shareholders, representing at least the required
percentage of capital, also have the possibility of requesting
that items and proposed resolutions be added to the agenda in
accordance with the Law.
Conditions for admission (Article 27 of the Company’s
by-laws)
Every shareholder has the right to participate in General
Meetings either in person or by proxy, provided his/her shares
are fully paid-up and:
(cid:125) for holders of registered shares, that they are held in
a registered account (directly or through a financial
intermediary) at 0:00 a.m. (Paris time) on the second
business day preceding the meeting;
(cid:125) for holders of shares in bearer form, that they are recorded
in a bearer securities account maintained by the accredited
intermediary at 0:00 a.m. (Paris time) on the second
business day preceding the meeting.
The registration of shares in a bearer securities account
maintained by the accredited intermediary shall be validated
by a shareholding certificate (attestation de participation)
issued by the accredited intermediary to the holder of the
shares. This certificate must be attached to the voting or
proxy form or to the request for an admission card issued in
the shareholder’s name. A certificate can also be issued to
a shareholder who wishes to attend in person the General
Meeting and who has not received an admission card by the
second business day preceding the meeting.
6
DASSAULT SYSTÈMES ANNUAL REPORT 2015
187
6 Information about Dassault Systèmes SE, the share capital and the ownership structure
Information about Dassault Systèmes SE
Shareholders may vote by mail using a form that will be sent to
them under the conditions indicated by the notice of meeting.
The form, duly completed and accompanied, as the case may
be, by a shareholding certificate (attestation de participation),
must be received by Dassault Systèmes SE at least three days
before the date of the General Meeting, or it will not be taken
into consideration.
A shareholder may be represented by his/her spouse or by
any other natural or legal person who has been appointed as
proxy, under conditions provided by the Law. The shareholders
who are legal entities are represented by the natural persons
duly authorized to represent them with respect to third parties
or by any person to whom the power of proxy has been
transferred.
A shareholder, who is a non-French resident as defined in
Article 102 of the French Civil Code, may be represented at
General Meetings by an accredited intermediary registered
according to the provisions of the Law. Such shareholder
will be considered present in calculating the quorum and the
results of voting.
If the Board of Directors so decides when convening the General
Meeting, any shareholder may also participate and vote at
the meeting by video-conference or by any other means of
telecommunications permitting him/her to be identified and
to participate effectively. Such participation must comply with
the conditions and means set forth in the provisions of the
Law. Such shareholder will be accounted for in calculating the
quorum and the results of voting.
Actions needed to amend shareholders’ rights
(Articles 13, 31 and 32 of the Company’s by-laws)
Only an Extraordinary General Meeting can amend
shareholders’ rights in compliance with the provisions of the
Law.
Except as may be otherwise provided for under the provisions
of the Law and with the exception of reverse share splits carried
out in accordance with the Law, no majority may impose on
shareholders an increase in their commitments. If new classes
of shares are created, only an Extraordinary General Meeting
and a Special Meeting of Shareholders of the specific class of
shares may approve any amendment to the rights of these
classes of shares.
6.1.2.3
Shares and Voting Rights
Rights, privileges and restrictions attached
to each class of shares (Articles 13 and 39 of the
Company’s by-laws)
All the shares are of the same class and are entitled to, under
the Company’s by-laws, the same rights to the allocation of
profits and any amounts distributed in the event of liquidation
(see also paragraph 6.1.2.1 “Allocation of Profits (Article 36
of the Company’s By-Laws)”). However, a double voting right
is attributed to any fully paid-up share held in registered form
for at least two consecutive years in the name of the same
holder (see paragraph “Double voting rights (Article 29 of the
Company’s by-laws)” below).
Conditions for exercising voting rights
(Articles 11 and 29 of the Company’s by-laws)
The right to vote attached to shares or dividend-right shares is
proportional to the portion of capital they represent.
Voting is carried out by show of hands, by roll call or secret
ballot, as decided by the secretariat of the meeting or the
shareholders. Shareholders may also vote by mail, by video-
conference or by any other means of communication, as
indicated in the preceding paragraph. For the calculation of
the majority, the votes cast shall not include votes attaching
to shares in respect of which the shareholder has not taken
part in the vote or has returned a blank or spoilt ballot paper.
In case of stripping of the ownership of the shares, the voting
right attached to the share belongs to the bare owner (nu-
propriétaire), except for the decisions relating to the allocation
of profits for which it belongs to the beneficial owner
(usufruitier).
Double voting rights (Article 29 of the Company’s by-
laws)
Each share gives the right to one vote. Nevertheless, since
2002, a double vote has been awarded to all fully paid-up
shares held in registered form for at least two consecutive
years in the name of the same holder. In the case of a capital
increase by incorporation of reserves, profits or premiums,
this double voting right will be attached on the date of their
issuance to free registered new shares allotted to a shareholder
in consideration for his or her old shares giving rise to
such right.
Under the Law, any share converted into a bearer share or
changing hands shall lose the right to the double voting right
except in the case of a transfer from a registered account to
another registered account at inheritance or a gift inter vivos to
a spouse or a relative entitled to succeed to the donor’s estate.
The double voting right may also be cancelled by a resolution
of the shareholders at an Extraordinary General Meeting,
provided the approval of the Special Meeting of Shareholders
having a double voting right.
Limitations on voting rights
The by-laws contain no restrictions on the exercise of voting
rights attached to Dassault Systèmes SE shares except in
the event of stripping of the ownership of the shares (see
paragraph “Conditions for exercising voting rights (Articles 11
and 29 of the Company’s by-laws)” above).
6.1.2.4 Declarations Concerning Crossing of
the Ownership Thresholds (Article 13
of the Company’s By-Laws)
In addition to the legal obligation to inform Dassault Systèmes
SE and the Financial Markets Authority (AMF) in the event
a shareholder’s interest passes the thresholds set out in
188 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Information about Dassault Systèmes SE, the share capital and the ownership structure
Information about the Share Capital
6
Article L. 233-7 of the French Commercial Code, any natural
or legal person, acting alone or in concert with others, who
acquires directly or indirectly shares representing at least
2.5% of Dassault Systèmes SE’s share capital or voting rights,
or a multiple thereof, must inform Dassault Systèmes SE of
the total number of shares or voting rights which it holds.
This information must be sent to Dassault Systèmes SE by
registered letter with return receipt requested, within four
trading days following the date of acquisition.
This declaration must be made each time the number of shares
held exceeds this threshold of 2.5% (or one of its multiples), up
to 50% (inclusive) of the total number of Dassault Systèmes
SE shares or voting rights, or falls below it. The shareholder
must certify in each declaration that it includes all shares or
voting rights held or owned, in accordance with Article L. 233-
7 et seq. of the French Commercial Code. The declaration must
also indicate the date or dates on which the acquisitions or
divestitures occurred.
In the event of non-compliance of this requirement, the
shares exceeding the fraction of 2.5% which should have
been declared will lose their voting rights, upon the request
recorded in the minutes of the General Meeting of one or more
shareholders holding a portion of Dassault Systèmes SE share
capital or voting rights equal to at least 2.5% of the capital
or voting rights. The voting rights will be lost for all General
Meetings held until the expiration of two years following the
date on which the required declaration is made.
6.1.2.5
Terms in the Company’s By-Laws,
Charter or Regulation Which Could
Delay, Postpone or Prevent a Change
in Control
Other than the aforementioned double voting right (see
paragraph 6.1.2.3 “Shares and Voting Rights”) and the
reporting obligation when holdings exceed 2.5%
(see
paragraph 6.1.2.4 “Declarations Concerning Crossing of the
Ownership Thresholds (Article 13 of the By-Laws)”), Article 10
of the by-laws provides that Dassault Systèmes SE may, at
any time and in compliance with the provisions of the Law,
request that a central depositary maintaining the Company’s
share register, communicate to it the name (or corporate name
for legal entities), the nationality, the year of birth or the year
of incorporation and the postal and, where applicable, e-mail
address of holders of Dassault Systèmes SE shares in bearer
form which grant, immediately or over time, the right to vote
at General Meetings, as well as the number of shares held
by each of these shareholders and, where appropriate, any
restrictions applicable to such shares.
6.1.2.6
Terms in the Company’s By-Laws
Concerning Modifi cations in Share
Capital Which Are More Restrictive
than the Law
The by-laws of Dassault Systèmes SE do not contain any
provisions concerning modifications of share capital which are
more restrictive than those provided under the Law.
6
6.2
Information about the Share Capital
6.2.1 Share Capital at February 29, 2016
At February 29, 2016, the Company’s share capital was comprised of 256,850,348 fully paid-up shares with a nominal value
of €0.50 per share. At December 31, 2015, the Company’s share capital was €128,357,093, divided into 256,714,186 shares.
6.2.2 Potential Share Capital
At February 29, 2016, outstanding share subscription options
(whether or not exercisable) would, if all were exercised, result
in the issuance of 5,064,994 new shares, representing 1.97%
of the Company’s share capital at that date (on a diluted basis).
On the basis of the closing price of the Company’s shares
on February 29, 2016 (€69.89 per share), the exercise of
all exercisable issued options, whose exercise price was less
than that closing price, would have resulted in the issuance of
2,872,387 new shares, representing 1.12% of the Company’s
DASSAULT SYSTÈMES ANNUAL REPORT 2015
189
6 Information about Dassault Systèmes SE, the share capital and the ownership structure
Information about the Share Capital
share capital at that date (on a diluted basis). The dilutive effect
per share at December 31, 2015 is also set forth in Note 11 to
the consolidated financial statements.
In connection with the acquisition of the SolidWorks company
in 1997, Dassault Systèmes SE issued shares to the holders of
shares subscription options and warrants issued by SolidWorks
prior to this acquisition. These Dassault Systèmes shares
have historically been held by the Group’s wholly-owned
U.S. subsidiary, SW Securities LLC. No other SolidWorks
share subscription options or warrants remain outstanding at
this time. At December 31, 2015, as at February 29, 2016,
SW Securities LLC held 503,614 shares, or approximately
0.20% on these dates, of the Company’s share capital. Similar
to treasury stock, the shares held by SW Securities LLC do not
have voting rights and are not eligible for dividends.
Other than the share subscription options granted
in
connection with stock option plans and share grants as
described in paragraph 5.3.1 “Compensation of the Company’s
corporate officers” and paragraph 5.3.2 “Interests of Executive
Management and Employees in the Share Capital of Dassault
Systèmes SE”, there are no other securities giving a right to
subscribe shares of Dassault Systèmes SE, and there is no
agreement which could result in a capital increase. Dassault
Systèmes SE has not issued any securities which do not
represent an interest in its share capital.
Pledges of shares
To the Company’s knowledge, there was no pledge of Dassault
Systèmes shares in registered form and representing a
significant portion of its share capital as of February 29, 2016.
6.2.3 Changes in Dassault Systèmes SE Share Capital
over the Past Three Years
Date
Operation
February 28,
2013
Capital increase resulting from the exercise
of share subscription options
Nominal amount of
changes in share capital
(in euros)
Amount in share
capital
(in euros)
Number of
shares created
or canceled
Total number
of shares
292,488
125,389,266
292,488
125,389,266
June 25,
2013
Capital increase by a dividend payment in shares
741,175
126,130,441
741,175
126,130,441
February 28,
2014
Capital increase resulting from the exercise
of share subscription options
March 21,
2014
Share capital reduction through cancellation
of treasury stock
940,826
127,071,267
940,826
127,071,267
(741,175)
126,330,092
(741,175)
126,330,092
June 20,
2014
July 9,
2014
July 17,
2014
Capital increase by a dividend payment in shares
802,310
127,132,402
802,310
127,132,402
Capital increase resulting from the exercise
of share subscription options
729,347
127,861,749
729,347
127,861,749
Split of the share nominal value by two
-*
127,861,749 127,861,749*
255,723,498
February 28,
2015
Capital increase resulting from the exercise
of share subscription options
March 20,
2015
Share capital reduction through cancellation
of treasury stock
555,900
128,417,649
1,111,800
256,835,298
(802,310)
127,615,339
(1,604,620)
255,230,678
June 22,
2015
Capital increase by a dividend payment in shares
92,854.50 127,708,193.50
185,709
255,416,387
February 29,
2016
Capital increase resulting from the exercise
of share subscription options
*
The nominal value of the share was reduced from €1 to €0.50 on July 17, 2014.
716,980.50
128,425,174
1,433,961
256,850,348
The changes in equity resulting from the operations through December 31, 2015 set forth above are included in the “Consolidated
Statements of Shareholders’ Equity” in the consolidated financial statements.
190 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Information about Dassault Systèmes SE, the share capital and the ownership structure
Information about the Share Capital
6
6.2.4 Delegations and Authorizations Granted to the Board
of Directors by the General Meeting
The following table summarizes the delegations and authorizations granted by the General Meeting to the Board of Directors
and with effect during the 2015 financial year and as of the date of this Annual Report (Document de référence). It includes
authorizations to increase share capital and to repurchase and cancel the Company’s own shares.
Resolutions
and General
Meetings
(“GM”)
Description of the delegation of authority granted to the Board of Directors
Utilization in 2015
SHARES BUYBACK AND CANCELLATION OF SHARES
14th
resolution
GM of
05/28/2015
15th
resolution
GM of
05/28/2015
Authorization: buy back or purchase Dassault Systèmes SE shares.
Duration: approximately 12 months (expiring at the GM approving the financial statements for the fiscal
year ended on 12/31/2015).
Cap: 10% of share capital within the limit of €500 million and a maximum price per share not exceeding €90.
See paragraph 6.2.5
“Stock repurchase
programs”
Authorization: cancel shares purchased under the buyback program.
Duration: approximately 12 months (expiring at the GM approving the financial statements for the fiscal
year ended on 12/31/2015).
Cap: 10% of share capital in a 24-month period.
See paragraph 6.2.5
“Stock repurchase
programs”
ISSUANCE OF SECURITIES
16th
resolution
GM of
05/28/2015
17th
resolution
GM of
05/28/2015
18th
resolution
GM of
05/28/2015
19th
resolution
GM of
05/28/2015
20th
resolution
GM of
05/28/2015
Authorization: increase the share capital by issuance of shares or securities giving right to shares of
Dassault Systèmes SE and issue securities giving right to debt securities, with preemptive right of
shareholders.
Duration: 26 months, i.e. until 07/28/2017.
Cap: For a maximum nominal amount of €12 million for shares or securities – For a maximum nominal
amount of €750 million for debt securities.
Authorization: increase the share capital by issuance of shares or securities giving right to shares of
Dassault Systèmes SE and issue securities giving right to debt securities, with waiver of preemptive right
of shareholders, by public offering.
Duration: 26 months, i.e. until 07/28/2017.
Cap: For a maximum nominal amount of €12 million for shares or securities – For a maximum nominal
amount of €750 million for debt securities (to be deducted from the aforementioned overall nominal limits).
Authorization: increase the share capital and issue securities giving right to debt securities, without
preemptive rights of shareholders, under the delegation referred to in the previous line, by a private
placement, under section II of the Article L. 411-2 of the French Monetary and Financial Code.
Duration: 26 months, i.e. until 07/28/2017.
Cap: To be deducted from the aforementioned overall nominal limit of €12 million (16th resolution).
Authorization: increase the share capital by incorporation of reserves, profits or premiums.
Duration: 26 months, i.e. until 07/28/2017.
Cap: Up to the aforementioned overall nominal limit of €12 million (16th resolution).
Authorization: increase the share capital to remunerate contributions in kind of shares or equity-linked
securities.
Duration: 26 months, i.e. until 07/28/2017.
Cap: 10% of share capital.
None
None
None
None
None
6
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6 Information about Dassault Systèmes SE, the share capital and the ownership structure
Information about the Share Capital
Resolutions
and General
Meetings
(“GM”)
Description of the delegation of authority granted to the Board of Directors
Utilization in 2015
ISSUANCE FOR THE BENEFIT OF EMPLOYEES AND EXECUTIVE OFFICERS
Authorization: grant free shares, existing or to be issued, for the benefit of certain employees and/or
corporate officers of Dassault Systèmes SE and its affiliated entities as defined in Article L. 225-197-2 of
the French Commercial Code.
Duration: 38 months, i.e. until 07/28/2018.
Cap: 2% of share capital.
This authorization has been cancelled and replaced by the authorization below
None
Authorization: grant free shares, existing or to be issued, for the benefit of certain employees and/or
corporate officers of the Company and its affiliated entities as defined in Article L. 225-197-2 of the
French Commercial Code.
Duration: 38 months, i.e. until 11/04/2018.
Cap: 2% of share capital.
Described in
paragraph 5.3.2.2
“Performance
shares”
Authorization: grant stock options giving right to subscribe to new shares or purchase existing shares for
the benefit of certain employees and/or corporate officers of Dassault Systèmes SE and its affiliated
entities as defined in Article L. 225-180 of the French Commercial Code.
Duration: 38 months, i.e. until 07/30/2016.
Cap: 5% of share capital.
See
paragraph 5.3.2.1
“Dassault Systèmes
SE Share Subscription
options”
Authorization: increase the share capital for the benefit of members of a corporate savings plan of
Dassault Systèmes SE and its affiliated entities.
Duration: 26 months, i.e. until 07/28/2017.
Cap: For a maximum nominal amount of €5 million to be deducted from the overall limit set forth by
the 16th resolution of the General Meeting on May 28, 2015 .
This authorization has been cancelled and replaced by the authorization below
2nd resolution
EGM of
09/04/2015
Authorization: increase the share capital for the benefit of members of a corporate savings plan of
Dassault Systèmes SE and its affiliated entities.
Duration: 26 months, i.e. until 11/04/2017.
Cap: For a maximum nominal amount of €5 million to be deducted from the limit set forth by
the 16th resolution of the General Meeting on May 28, 2015 .
None
None
21st
resolution
GM of
05/28/2015
1st resolution
EGM of
09/04/2015
16th
resolution
GM of
05/30/2013
22nd
resolution
GM of
05/28/2015
The authorizations to purchase the Company’s shares and to
cancel these purchased shares expire at the end of the General
Meeting to be held on May 26, 2016. It is thus proposed to
this General Meeting to renew these authorizations (see
paragraph 6.2.5.2 “Description of the Share Repurchase
Program Proposed to the General Meeting on May 26,
2016”). It will also be proposed to renew the authorization
allowing the Board of Directors to grant options giving right
to subscribe to shares or purchase shares for corporate
officers and/or employees of Dassault Systèmes and its
affiliated companies and the authorization allowing the Board
of Directors to increase the share capital for the benefit of
members of a corporate savings plan of Dassault Systèmes,
without pre-emptive rights (see paragraph 7.1 “Presentation
of the Resolutions Proposed by the Board of Directors to the
General Meeting on May 26, 2016”).
192 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
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Information about the Share Capital
6
6.2.5 Stock Repurchase Programs
6.2.5.1
Transactions carried out by Dassault
Systèmes SE in 2015 and early 2016
Transactions carried out by Dassault Systèmes SE in
2015
During 2015 financial year, Dassault Systèmes SE purchased,
under the authorizations granted to the Board of Directors by
the General Meetings of May 26, 2014 and May 28, 2015,
420,063 of its own shares.
These shares were purchased at an average price of €62.36
per share, giving a total cost of €26,196,107.81 (excluding
tax), given that there was no acquisition of blocks of shares
on the over-the-counter market. The transaction costs paid
by the Company in connection with these shares repurchased
amounted to €9,430.56, all taxes included (plus the tax on
financial transactions for an amount of €52,392.22).
These 420,063 shares were entirely allocated for purposes
of coverage of the Company’s obligations resulting from
performance share grants.
The shares repurchased before 2015 were used as follows:
(cid:125) 1,604,620 shares were canceled by the Board of Directors
of March 20, 2015;
(cid:125) 773,550 shares, which had been allocated to cover the
Company’s obligations resulting from share grants decided
prior to 2015, were transferred to the beneficiaries (see
paragraph 5.3.1 “Compensation of the Company’s corporate
officers”).
The Company directly held, on December 31, 2015, 2,359,891
(including 50,988 shares through the liquidity agreement) of
its own shares of a nominal value of €0.50 each, which had
been repurchased at an average price of €46.86, representing
0.92% of share capital at that date. Out of these 2,359,891
shares, 2,308,903 shares are at the disposal of Dassault
Systèmes SE and are allocated to cover the Company’s
obligations resulting from performance shares grants.
Pursuant to the authorization granted in 2014, on January 5,
2015, Dassault Systèmes SE signed a liquidity agreement
in accordance with the Code of Ethics of the AFEI (French
association of investment firms) recognized by the Financial
Markets Authority (AMF), with Oddo et Cie(1) for an annual
amount of €50,000 implemented from January 7, 2015 for
an initial period until December 31, 2015, automatically
renewable for subsequent 12-month terms.
During 2015, 2,625,732 shares have been purchased and
2,574,744 shares have been sold within the framework of this
liquidity agreement. As at December 31, 2015, the following
resources appeared on the liquidity account:
(cid:125) 50,988 Dassault Systèmes shares; and
(cid:125) €7,903,018.92 in cash.
Transactions carried out by Dassault Systèmes SE in
early 2016
Since the beginning of 2016, Dassault Systèmes SE has
acquired 502,437 of its own shares.
These shares were purchased at an average price of €65.14
per share, giving a total cost of €32,729,925.75 (excluding
tax). The transaction costs paid by the Company in connection
with these shares repurchased amounted to €11,782.76, all
taxes included (plus the tax on financial transactions for an
amount of €65,459.85).
Under this liquidity agreement, since January 1, 2016 until
February 29, 2016, 311,440 shares were purchased and
294,430 shares were sold.
During 2015 and since the start of 2016, the Company has
not performed any transactions on derivative securities linked
to its shares and has not purchased or sold any of its shares
by exercising them or through the maturity of such derivative
securities.
6.2.5.2 Description of the Stock Repurchase
Program Proposed to the General
Meeting on May 26, 2016
Pursuant to Articles 241-2 et seq. of the General Regulations
of the Financial Markets Authority (AMF) and L. 451-3 of the
French Monetary and Financial Code, and in accordance with
European Regulations, this description relates to the terms
and objectives of the Company’s share repurchase program
that will be submitted for approval at the General Meeting of
May 26, 2016.
Breakdown of treasury stock by purpose as of the date
of this document
On February 29, 2016, Dassault Systèmes SE held 2,877,820
of its own shares directly and 503,614 indirectly. These
2,877,820 shares were allocated to the following objectives:
(cid:125) coverage of the Company’s obligations resulting from share
grants decided in 2012, 2014 and 2015: 2,811,340 shares;
(cid:125) liquidity agreement signed with Oddo et Cie (1) on January 5,
2015 and renewed for the financial year 2016: 66,480
shares.
6
(1) Agreement initially entered into with Corporate Finance transferred to Oddo et Cie by virtue of universal estate transfer with effect as at March 1, 2016.
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6 Information about Dassault Systèmes SE, the share capital and the ownership structure
Information about the Shareholders
Purposes of the new repurchase program
1) Cancel shares in order to increase the return on equity and
net income per share.
2) Provide securities
(representing no more than 5%
of the Company’s share capital) for payment, or for
exchange, particularly in connection with external growth
transactions.
3) Ensure that there is a market or liquidity for the shares
of Dassault Systèmes under a liquidity agreement with
an accredited financial service provider, in accordance
with a Code of Ethics recognized by the Financial Markets
Authority (AMF).
4) Meet obligations related to shares subscription options or
other share grants to employees or corporate officers of
Dassault Systèmes SE or of an affiliated company.
5) Meet the Company’s cash obligations based on an increase
in the market price of Dassault Systèmes SE shares, as
made to employees and corporate officers of the Company
or of an affiliated company.
6) Provide shares in connection with the exercise of rights
attached to securities providing access to the capital of
Dassault Systèmes SE.
7) Carry out any market practice which may be authorized by
the law or by the Financial Markets Authority (AMF).
The purposes 1-4 and 6 above correspond to the terms of
European Regulation no. 2273/2003 of December 22, 2003,
in application of the directive 2003/6/EC of January 28,
2003, and market practices accepted by the Financial Markets
Authority (AMF).
The General Meeting of May 26, 2016 will also be asked to
authorize the Board of Directors to cancel, as the case may be,
all or part of the shares which it may repurchase in connection
with the share repurchase program and to carry out the
corresponding reduction in share capital.
Maximum proportion of share capital,
maximum number, characteristics of the
securities that the Company proposes to acquire,
and maximum purchase price
The Board of Directors may repurchase Dassault Systèmes
shares representing up to 10% of the Company’s share
capital at the date of the General Meeting authorizing the
program, i.e. 25,685,034 shares at February 29, 2016, the
most recent date for determining the capital as of the date
of this description. The purchase price of the shares would be
capped at €100 per share and subject to the limits stipulated
by the applicable regulations. The maximum amount of the
funds used for the purpose of buying back shares would be
€500 million.
Duration of the stock repurchase program
The program would last about 12 months, starting on
the General Meeting of May 26, 2016. This authorization
should be valid until the Ordinary General Meeting approving
the financial statements for the financial year ending
December 31, 2016.
6.3
Information about the Shareholders
6.3.1 Shareholder Base and Double Voting Rights
The table below sets forth certain information concerning
Dassault Systèmes SE’s shareholder base over the last three
fiscal years. Pursuant to the Financial Markets Authority
(AMF) recommendation no. 2009-16, it specifies:
(cid:125) the theoretical or “gross” voting rights, taking into account
the voting rights attached to the shares without voting
rights, in accordance with Article 223-11 of the General
Regulations of the Financial Markets Authority (AMF) and
used as a denominator by shareholders to calculate their
percentage of shares held and voting rights for the purposes
of regulatory declarations (in particular the declarations
with regards to exceeding the threshold); and
(cid:125) the voting rights that can be exercised at the General
Meeting (“GM” in the table below) or “nets”, not taking into
account shares without voting rights.
Double voting rights are attributed to all fully paid-up shares
held in registered form for at least two consecutive years in
the name of the same holder.
The major shareholders of Dassault Systèmes SE do not hold
voting rights which are different from voting rights of other
shareholders (such as double voting rights).
194 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Information about Dassault Systèmes SE, the share capital and the ownership structure
Information about the Shareholders
6
Shareholders
AT DECEMBER 31, 2015
Shares
% of capital
Theoretical
voting rights
% of theoretical
voting rights
Voting rights
exercisable in the
General Meeting
% of voting
rights
exercisable in
the General
Meeting
Groupe Industriel Marcel Dassault
105,716,646
41.18%
210,104,554
55.12%
210,104,554
55.53%
Charles Edelstenne (1)
and beneficiaries (2)
Bernard Charlès
Treasury stock (3)
Indirect treasury stock (4)
Directors and senior management (5)
Public
TOTAL
AT DECEMBER 31, 2014
15,618,506
6.08 %
31,033,732
8.14%
31,033,732
2,890,441
2,359,891
503,614
867,821
128,757,267
256,714,186
1.13% (6)
0.92%
0.20%
0.34%
5,239,723
2,359,891
503,614
914,765
1.37% (6)
5,239,723
0.62%
0.13%
0.24%
–
–
914,765
50.15 %
131,042,738
34.38%
131,042,738
100% 381,199,017(7)
100% 378,335,512(7)
8.20%
1.38% (6)
–
–
0.24%
34.65%
100%
Groupe Industriel Marcel Dassault
105,386,646
41.11%
208,709,314
55.04%
208,709,314
55.74%
Charles Edelstenne (1)
and beneficiaries (2)
Bernard Charlès
Treasury stock (3)
Indirect treasury stock (4)
Directors and senior management (5)
Public
TOTAL
AT DECEMBER 31, 2013
15,562,944
2,751,624
4,267,010
503,614
348,474
6.07%
30,978,146
8.17%
30,978,146
1.07% (6)
1.66%
0.20%
0.14%
4,719,926
4,267,010
503,614
390,618
1.24% (6)
4,719,926
1.13%
0.13%
0.10%
–
–
390,618
127,543,765
49.75%
129,610,747
34.19%
129,610,747
256,364,077(7)
100% 379,178,925(7)
100% 374,408,301(7)
8.27%
1.26% (6)
–
–
0.11%
34.62%
100%
6
Groupe Industriel Marcel Dassault
52,193,954
41.12%
103,855,288
55.28%
103,855,288
55.78%
Charles Edelstenne (1)
and beneficiaries (2)
Bernard Charlès
Treasury stock
Indirect treasury stock (4)
Directors and senior management (4)
Public
TOTAL
7,739,539
1,174,641
1,413,229
251,807
24,986
64,134,829
126,932,985
6.10%
15,391,802
8.21%
15,391,802
0.93% (6)
1.11%
0.20%
0.02%
1,973,688
1,413,229
251,807
39,389
1.05% (6)
1,973,688
0.75%
0.13%
0.02%
–
–
39,389
50.52%
64,909,781
34.56%
64,909,781
100%
187,866,910
100%
186,201,874
8.28%
1.06% (6)
–
–
0.02%
34.88%
100%
(1) Including shares held in trust for the benefit of his family and managed by Mr. Edelstenne.
(2) At December 31, 2015, Mr. Edelstenne held 4,001,806 shares with all ownership rights and 3,318 shares through two family companies which he manages, representing a total
of 1.56% of the capital and 2.08% of the exercisable voting rights, as well as 11,613,382 shares with “usage” rights (usufruit). For the usage rights with respect to these
11,613,382 shares, representing 6.12% of the exercisable voting rights, Mr. Edelstenne can only exercise the right to vote on decisions of the General Meeting concerning the
allocation of profits; the holders of the bare property rights (nue-propriété) exercise the right to vote for other resolutions in compliance with Article 11 of the by-laws.
(3) Including 50,988 shares through the liquidity agreement.
(4) Shares held by SW Securities LLC. This company is a subsidiary of Dassault Systèmes SE, Dassault Systèmes’ shares held by it do not have voting rights.
(5) Excluding Mr. Edelstenne and Mr. Charlès, “management” includes the officers listed in paragraph 5.1.2 “The Executive Committee” of this Annual Report (Document de référence).
(6) For further information, see Table 5 of paragraph 5.3.1 “Compensation of the Company’s Corporate Officers (mandataires sociaux)”.
(7) The number of shares and voting rights making up the share capital were doubled after the two-for-one stock split applied to Dassault Systèmes’ shares on July 17, 2014.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
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6 Information about Dassault Systèmes SE, the share capital and the ownership structure
Information about the Shareholders
rights amounted
The overall number of voting
to
381,199,017 as at December 31, 2015 (the number of
exercisable voting rights was 378,335,512) and, as at
February 29, 2016, 381,332,631 (with the number of
exercisable voting rights amounting to 377,951,197). The
difference between the number of theoretical and exercisable
voting rights is explained by the treasury stock and shares
controlled by the Company.
Investment management
MFS
(MFS) notified Dassault
Systèmes SE that as of September 17, 2015 the funds
managed by companies within its group (i) held more than
2.5% of the share capital of Dassault Systèmes SE and (ii)
crossed downward the 2.5% threshold of the voting rights of
Dassault Systèmes SE.
Based on shareholders’ obligations to declare if they exceed the
threshold, there are no other shareholders (except as indicated
above) who held 2.5% (threshold set forth in the Company’s
by-laws), directly or indirectly, alone or in agreement with
other shareholders or more than 5% of the Company’s share
capital or voting rights at December 31, 2015.
Although Dassault Systèmes SE voluntarily delisted its shares
from NASDAQ in October 2008, it continues to maintain its
ADR (“American Depositary Receipts”) program, which are
still traded on the over-the-counter market (see paragraph 6.4
“Stock Market Information”). On February 29, 2016 there were
7,594,253 American Depositary Shares (“ADS”) outstanding
and the number of recorded ADS holders, holding them either
for themselves or for third parties amounted to 55.
In January 2016, Dassault Systèmes SE commissioned a
survey on the Company’s shares from an external specialized
services provider. According to this survey, institutional
investors holding more than 2,000 shares each numbered 474
and held 42.8% of the Dassault Systèmes SE share capital as
at December 31, 2015.
As at February 29, 2016, Dassault Systèmes SE held 66,480
shares within the framework of the liquidity agreement entered
into with Oddo et Cie, and 2,811,340 treasury shares. Out of
these 2,811,340 treasury shares, 922,500 shares have been
bought during the buyback program adopted by the General
Meeting of May 28, 2015 and the remaining , i.e. 1,888,840
shares within the framework of a program of earlier buybacks,
which represents approximately 1.09% of the share capital as
at February 29, 2016, with no voting rights or dividend rights
being attached to these shares.
At December 31, 2015, 131,303,888 Dassault Systèmes
shares (i.e. approximately 51.15% of the capital) are held in
registered form; they provide entitlement to 252,976,302
exercisable voting rights (i.e. approximately 66.36% of the
gross voting rights).
In accordance with Article L. 225-102 of the French
Commercial Code, the number of Dassault Systèmes shares
held by employees through the corporate savings plan (plan
d'épargne entreprise) was 340,230 shares at December 31,
2015, or approximately 0.13% of the total number of shares
at that date.
6.3.2 Controlling Shareholder
GIMD (Groupe Industriel Marcel Dassault) is the principal
shareholder of Dassault Systèmes SE with, as of December 31,
2015, 41.18% of the share capital and 55.53% of the exercisable
voting rights (i.e. 55.12% of theoretical voting rights). With
more than 50% of the voting rights of Dassault Systèmes SE,
GIMD controls Dassault Systèmes. GIMD is wholly-owned by
the members of the Dassault family.
In order to ensure that the control of GIMD is not exercised
in an “improper” manner under the meaning of the General
Regulations of the Financial Markets Authority (AMF), the
Board of Directors of Dassault Systèmes SE is made up of
44% of independent directors i.e. a proportion exceeding
the requirement stipulated in the AFEP-MEDEF Code for
controlled companies, and that all of the committees under
the Board (Audit Committee, Compensation and Nomination
Committee, Scientific Committee) are only made up of
independent directors.
As GIMD possesses more than one third but less than half
of the shares and more than half of the voting rights in the
Company, GIMD may not increase its stake by more than 1%
of the total number of shares of the Company in a period of
12 consecutive months, unless it launches a public tender
offer on all the equity securities issued by Dassault Systèmes,
except for an exemption from the obligation to make an offer
based on Article 234-9 (6°) of the General Regulations of the
Financial Markets Authority (AMF), which the latter can grant
at its discretion.
196 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Information about Dassault Systèmes SE, the share capital and the ownership structure
Information about the Shareholders
6
6.3.3 Shareholder Agreements
In 2011, 2013, 2014 and 2015, Dassault Systèmes was informed about collective undertakings concluded concerning the
holding of shares whose characteristics are summarized in the tables hereafter in accordance with Financial Markets Authority
(AMF) recommendation no. 2009-16.
Collective undertakings concluded in 2015
System
Date of signing
Duration of collective undertakings
At least two years
December 17, 2015
December 17, 2015
At least two years
Article 787 B of the General Taxation Code
Article 787 B of the General Taxation Code
Contractual duration of the agreement
Permanent with cases of termination
Permanent with cases of termination
Conditions for renewal
No specific conditions stipulated
No specific conditions stipulated
Capital and voting rights % concerned by
the agreement (at the date of its execution)
24.85% of the share capital and 33.33% of
the voting rights
24.66% of the share capital and 33.20% of the
voting rights
Names of the signatories having the capacity
of executives (1)
Mr. Charles Edelstenne
Mr. Bernard Charlès
Mr. Charles Edelstenne
Mr. Bernard Charlès
Name(s) of the signatorie(s) having close
links with executives
Names of the signatories holding at least 5%
of the capital and/or voting rights of
Dassault Systèmes SE
Groupe Industriel Marcel Dassault
Groupe Industriel Marcel Dassault
Groupe Industriel Marcel Dassault
Mr. Charles Edelstenne and beneficiaries (2)
Groupe Industriel Marcel Dassault
Mr. Charles Edelstenne and beneficiaries (2)
(1) Pursuant to Article 885 O bis of the General Taxation Code.
(2) See Note 2 under the table of paragraph 6.3.1 “Shareholder Base and Double Voting Rights”.
6
Collective undertakings concluded in 2014
System
Date of signing
Duration of collective undertakings
At least two years
February 27, 2014
Article 787 B of the General Taxation Code
Article 787 B of the General Taxation Code
December 16 and 17, 2014
At least two years
Contractual duration of the agreement
Permanent with cases of termination
Permanent with cases of termination
Conditions for renewal
No specific conditions stipulated
No specific conditions stipulated
Capital and voting rights % concerned by
the agreement (at the date of its execution)
25.0% of the share capital and 33.8% of
the voting rights
24.7% of the share capital and 33.4% of the
voting rights
Names of the signatories having the capacity
of executives(1)
Mr. Charles Edelstenne
Mr. Bernard Charlès
Mr. Charles Edelstenne
Mr. Bernard Charlès
Name(s) of the signatorie(s) having close
links with executives
Names of the signatories holding at least 5%
of the capital and/or voting rights of
Dassault Systèmes SE
Groupe Industriel Marcel Dassault
Groupe Industriel Marcel Dassault
Groupe Industriel Marcel Dassault
Mr. Charles Edelstenne and beneficiaries (2)
Groupe Industriel Marcel Dassault
Mr. Charles Edelstenne and beneficiaries (2)
(1) Pursuant to Article 885 O bis of the General Taxation Code.
(2) See Note 2 under the table of paragraph 6.3.1 “Shareholder Base and Double Voting Rights”.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
197
6 Information about Dassault Systèmes SE, the share capital and the ownership structure
Information about the Shareholders
System
Date of signing
Duration of collective undertakings
At least two years
July 11, 2011
October 29, 2013
At least two years
Collective undertakings concluded
in 2011 still in force
Collective undertaking concluded in 2013
Article 787 B of the French Tax Code
Article 787 B of the French Tax Code
Contractual duration of the agreement
Permanent with cases of termination
Permanent with cases of termination
Conditions for renewal
No specific conditions stipulated
No specific conditions stipulated
Capital and voting rights % concerned
by the agreement (at its date of execution)
29.6% of the share capital and 41.8%
of the voting rights
28.2% of the share capital and 41.7%
of the voting rights
Names of the signatories having the capacity
of executives(1)
Mr. Charles Edelstenne
Mr. Bernard Charlès
Mr. Charles Edelstenne
Mr. Bernard Charlès
Name(s) of the signatorie(s) having close
links with executives
Names of the signatories holding at least 5%
of the capital and/or voting rights of
Dassault Systèmes SE
Groupe Industriel Marcel Dassault
Groupe Industriel Marcel Dassault
Groupe Industriel Marcel Dassault
Mr. Charles Edelstenne and beneficiaries(2)
Groupe Industriel Marcel Dassault
Mr. Charles Edelstenne and beneficiaries(2)
(1) Pursuant to Article 885 O bis of the French Tax Code.
(2) See Note 2 under the table of paragraph 6.3.1 “Shareholder Base and Double Voting Rights”.
The same shares can be subject to several joint lock-up agreements.
198 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Information about Dassault Systèmes SE, the share capital and the ownership structure
Stock Market Information
6
6.4 Stock Market Information
Stock Exchange
Shares of Dassault Systèmes have been listed on Compartiment
A of Euronext Paris (ISIN code FR0000130650) since June 28,
1996. Its shares were also listed on the NASDAQ in the form
of ADS (American Depositary Shares) under the symbol
DASTY until October 16, 2008. The ADS are still traded
under this symbol on the U.S. over-the-counter market. One
ADS represents one ordinary share (see paragraph 6.3.1
“Shareholding and Double Voting Rights”).
For dividend policy, see the paragraph 7.1 “Presentation of
the Resolutions Proposed by the Board of Directors to the
General Meeting on May 26, 2016”.
Share price history and trading volumes of Dassault Systèmes shares from January 1, 2015
(in euros except for Volume of shares traded)
Volume of
shares traded
Share price
on last day
of the month
Highest share
price during
the month
Lowest share
price during
the month
January 2015
February 2015
March 2015
April 2015
May 2015
June 2015
July 2015
August 2015
September 2015
October 2015
November 2015
December 2015
January 2016
February 2016
5,006,706
7,599,064
7,102,507
8,694,220
6,573,144
7,210,403
6,975,163
6,491,880
8,966,921
6,486,389
5,360,353
5,010,962
6,224,855
7,085,498
54.92
62.53
63.14
68.80
71.17
65.22
68.77
61.89
66.00
71.84
75.33
73.77
71.19
69.89
55.31
63.48
64.23
71.43
73.00
71.75
72.90
70.33
66.95
72.66
75.59
76.97
73.42
71.90
48.85
53.17
60.04
61.03
66.86
65.17
63.70
58.92
59.84
65.73
71.22
70.93
64.11
63.50
6
Person Responsible for Financial Communications
François-José Bordonado
Vice-President, Investor Relations
Indicative Timetable for the Publication of Financial
Information for 2016
(cid:125) First quarter of 2016: April 21, 2016
To obtain all financial information and documents published
by the Company, please contact:
Investor Relations Service
10, rue Marcel Dassault – CS 40501
78946 Vélizy-Villacoublay Cedex – France
Telephone: +33 (0)1 61 62 69 24
Fax: +33 (0)1 70 73 43 59
e-mail: investors@3ds.com
(cid:125) Second quarter of 2016: July 21, 2016
(cid:125) Third quarter of 2016: October 21, 2016
(cid:125) Fourth quarter of 2016: February 2017
DASSAULT SYSTÈMES ANNUAL REPORT 2015
199
6 Information about Dassault Systèmes SE, the share capital and the ownership structure
200 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
7
GENERAL
MEETING
CONTENTS
7.1 Presentation of the Resolutions
Proposed by the Board of
Directors to the General Meeting
on May 26, 2016
202
7.2 Draft Resolutions Proposed
by the Board of Directors
to the General Meeting
on May 26, 2016
208
DASSAULT SYSTÈMES ANNUAL REPORT 2015
201
7 General Meeting
Presentation of the Resolutions Proposed by the Board of Directors to the General Meeting on May 26, 2016
7.1 Presentation of the Resolutions Proposed
by the Board of Directors to the General Meeting
on May 26, 2016
Annual fi nancial statements and allocation
of the results
We invite you to approve the annual financial statements of
Dassault Systèmes SE (or the “Company” for the purposes
of the present Chapter 7 “General Meeting”) for the year
ended December 31, 2015, prepared on the basis of French
accounting principles, as they have been presented
in
paragraph 4.2 “Parent company financial statements”.
Dassault Systèmes SE has paid dividends every year since
1986. The decision to distribute dividends and their amount
depend on the profits and the financial position of Dassault
Systèmes SE as well as other factors. Dividends which have
been distributed but are not collected by a shareholder escheat
to the French State at the end of the five-year period following
the date of their payment.
Based on the financial statements and the management report of the Board of Directors included in this Annual Report (Document
de référence), a profit of €299,471,748.73(1) has been realized for the year ended December 31, 2015, which we propose that
you allocate as follows:
(cid:125) to the legal reserve
(cid:125) for distribution to the 256,850,348 shares making up the share capital as of February 29, 2016 of a dividend
of (€0.47 euro × 256,850,348 shares)(2)
(cid:125) to retained earnings
which, increased by the retained earnings from prior years of €1,784,847,265.29, brings the amount of retained
earnings to
€17,505.45
€120,719,663.56
€178,734,579.72
€1,963,581,845.01
(1) After allocation to the legal reserve, this profit increased by the retained earnings from prior years of €1,784,847,265.29, results in a distributable profit of €2,084,301,508.57.
(2) The aggregate amount of dividend will be increased, based on the number of new shares created between March 1, 2016 and the date of the General Meeting of May 26, 2016,
consecutively to the exercise of subscription options, it being specified that the maximum number of shares which could be issued upon the exercise of subscription options is
2,872,387, i.e., a maximum amount of a supplementary dividend of €1,350,021.89.
Further new shares created by exercise of options until the
date of the annual General Meeting deciding on the allocation
of profit related to the preceding year will receive the dividend
distributed with respect to that year (see paragraphs 5.3.2.1
“Dassault Systèmes Share Subscription Options” and 6.4
“Stock Market Information”).
by SW Securities LLC, a company which is controlled by the
Dassault Systèmes Group, as of the date of payment, shall
be allocated to “retained earnings”, in accordance with the
provisions of Article L. 225-210 of the French Commercial
Code and the contractual provisions in force between SW
Securities LLC and Dassault Systèmes SE.
Therefore, we propose to the General Meeting of May 26, 2016
to approve for the year 2015 the distribution of (i) a dividend
of €0.47 per share comprising the capital as of the date of this
General Meeting, resulting – on the basis of the number of
shares comprising the share capital as of February 29, 2016
– in an aggregate amount of €120,719,663.56 and (ii) where
applicable, an additional aggregate maximum amount of
€1,350,021.89, which corresponds to the maximum number
of new shares which could be issued between March 1, 2016
and the date of the General Meeting (i.e., 2,872,387 shares).
Shares will be traded ex-dividend as of June 2, 2016 and
dividends made payable as from June 24, 2016.
On the date of payment, the amount of the dividend
corresponding to (i) the treasury shares of Dassault Systèmes
SE and (ii) the treasury shares of Dassault Systèmes SE held
In addition, prior to distribution of the dividend, the Board of
Directors, or if so delegated, the Chief Executive Officer, will
determine the number of additional shares issued as a result of
the exercise of shares subscription options between March 1
and the date of the General Meeting on May 26, 2016. The
amount required for payment of dividends for shares issued
during this period shall be taken from “retained earnings”.
The amount distributed in this way may be taken into account
for determining shareholders’ total revenue subject to the
progressive rate of income tax for the year during which it was
received after application of an uncapped deduction of 40%
(as provided by Article 158-3-2 of the French Tax Code). The
dividend shall be subject to a non discharging withholding of
the income tax to the rate of 21% (as provided by Article 117
quater of the French Tax Code).
202 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
General Meeting
Presentation of the Resolutions Proposed by the Board of Directors to the General Meeting on May 26, 2016
7
Pursuant to Article 243 bis of the French Tax Code, it is noted that dividends per share paid over the last three years have been
as follows:
Dividend (in euros)
Number of shares eligible for dividends
2014
0.43
2013
0.83
2012
0.80
255,644,058 126,746,027* 125,572,474*
*
The number of shares was given before the two-for-one stock split of the Dassault Systèmes SE share on July 17, 2014.
Sumptuary expenses and general charges set forth in
Article 223 of the French Tax Code
In accordance with the provisions of Article 223 quater of the
French Tax Code, we inform you that no non-deductible tax
expenses and charges have been borne by the Company and
consequently no taxation has been borne by the Company in
this respect.
Consolidated fi nancial statements
In addition to the 2015 parent company annual financial
statements, it is also proposed to approve the Company’s
consolidated financial statements for the year ended
December 31, 2015, prepared in accordance with IFRS
standards as described in paragraph 4.1.1 “Consolidated
Financial Statements”.
Option to receive payment of dividends in the form of
shares
It is proposed that each shareholder be granted the option to
choose in whole or in part, to receive payment of the dividends
noted above, in cash or in the form of new shares of the
Company. If the option for payment in the form of new shares
is chosen, in whole or in part, the new shares will be issued
at a price equal to the average of the closing prices quoted
on Euronext Paris during the 20 stock exchange sessions
preceding the date of the General Meeting less the amount
of the dividend and rounded up to the next one hundredth of
a euro.
Shareholders may choose in whole or in part, for the payment
of the dividend in new shares between June 2 and June 15,
2016, inclusive, by sending their request to the financial
intermediaries that are authorized to pay the dividend or, for
shareholders listed in the direct registered share accounts held
by the Company, to its authorized representative (Société
Générale, securities department, 32 rue du Champ de Tir, CS
30812, 44308 Nantes Cedex 3). Accordingly, shareholders
who have not chosen payment of dividends in shares before
the end of this period or who have chosen only partial
payment, will receive the dividend in cash for the portion for
which payment in shares was not chosen as from June 24,
2016. For shareholders who have chosen to receive payment
of the dividend in shares, the new shares will be delivered as
of the same day.
If the option selected does not correspond to a whole number
of shares, the shareholder may choose between receiving a
number of shares rounded up to the next whole number, by
paying the difference in cash on the day the option is selected,
or receiving a number of shares rounded down to the next
whole number, and the balance in cash.
Related-party agreements (conventions réglementées)
The following agreements, which were approved in accordance
with Articles L. 225-38 et seq. of the French Commercial Code,
were in effect during the year ended December 31, 2015:
(cid:125) the following undertakings made by the Company in
connection with its “Directors & Officers” liability insurance
policy entered into with Allianz (ACS):
(cid:125) to reimburse, under certain conditions, the cost of
legal defense of directors in the event of their personal
liability being sought, and indemnify the directors for
the financial implications of such liability payment of
the costs in relation with legal defense related thereto, to
the extent they would not be covered by that insurance
policy (approved by the Board of Directors’ meeting held
on July 24, 1996),
(cid:125) to assume, under certain conditions, the cost of legal
defense of directors of the Company should they have to
prepare their personal defense before a civil, criminal or
administrative court in the United States in connection
with an inquiry or investigation conducted against the
Company (approved by the Board of Directors’ meeting
held on September 23, 2003);
(cid:125) agreement regarding the Company’s undertakings to the
benefit of Bernard Charlès, relating to indemnities which
would be due upon the termination of his functions as Chief
Executive Officer.
These agreements were reviewed by the Board of Directors
at its meeting on March 17, 2016, in accordance with the
provisions of Article L. 225-40-1 of the French Commercial
Code.
The Statutory Auditors have prepared a special report
pursuant to Articles L. 225-40 and L. 225-40-1 of the French
Commercial Code, as set forth in paragraph 4.2.4 “Special
Report of the Statutory Auditors on Related-party Agreements
and Commitments”. The General Meeting has been asked to
take note of this report which refers to no new agreements .
7
DASSAULT SYSTÈMES ANNUAL REPORT 2015
203
7 General Meeting
Presentation of the Resolutions Proposed by the Board of Directors to the General Meeting on May 26, 2016
Advisory opinion on the compensation elements
due or granted with respect to 2015 to Mr. Charles
Edelstenne, Chairman of the Board of Directors, and
Mr. Bernard Charlès, Chief Executive Offi cer
In accordance with the recommendation of the AFEP-MEDEF
Code, it is proposed that the General Meeting issue an advisory
opinion on the compensation elements due or granted with
respect to 2015 to each executive officer as defined by this
Code, namely Mr. Charles Edelstenne, Chairman of the Board
of Directors and Mr. Bernard Charlès, Chief Executive Officer,
whose compensation elements are summarized in the tables
below (See also paragraphs 5.1 “Report of the Chairman
on Corporate Governance and Internal Control” and 5.3.1
“Compensation of the Company’s Directors (mandataires
sociaux)”).
COMPENSATION ELEMENTS DUE OR GRANTED WITH RESPECT TO 2015 TO MR. CHARLES EDELSTENNE, CHAIRMAN
OF THE BOARD OF DIRECTORS
Compensation element
(in euros) Observations
Amount
Fixed compensation (1)
982,000 Gross fixed compensation for 2015 set by the Board of Directors on March 20, 2015, upon the
proposal of the Compensation and Nomination Committee.
Annual variable compensation
N/A Mr. Charles Edelstenne receives no annual variable compensation.
Deferred annual variable
compensation
Multi-year variable
compensation
Directors’ fees (2)
N/A Mr. Charles Edelstenne receives no deferred annual variable compensation.
N/A Mr. Charles Edelstenne receives no multi-year variable compensation.
43,000 Gross amount of directors’ fees due for 2015.
Extraordinary compensation
N/A Mr. Charles Edelstenne receives no extraordinary variable compensation.
Granting of share subscription
options and/or performance
shares
Indemnity upon start or
termination of function
N/A Mr. Charles Edelstenne does not hold any share subscription options and was not granted any
performance shares.
N/A Mr. Charles Edelstenne receives no indemnity upon start or termination of function.
Non-competition indemnity
N/A Mr. Charles Edelstenne receives no non-competition indemnity.
Additional retirement plan
N/A No additional retirement plan was implemented by Dassault Systèmes SE.
Benefits (3)
N/A Mr. Charles Edelstenne receives no benefits in kind.
(1) See also paragraph 5.1.4.1 “Compensation of Executive Officers”. In 2015, GIMD paid Mr. Charles Edelstenne, as GIMD’s Chief Executive Officer, gross fixed compensation of
€800,000.
(2) GIMD paid Mr. Charles Edelstenne €27,222 in directors’ fees in 2015 in connection with his mandate as a member of the Supervisory Board of GIMD. See also paragraph 5.1.4.4
“Directors’ Fees” on the conditions for distributing the directors’ fees at Dassault Systèmes SE.
(3) In 2015, GIMD granted benefits in kind related to the use of a car in an amount of €10,440 to Mr. Charles Edelstenne.
204 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
General Meeting
Presentation of the Resolutions Proposed by the Board of Directors to the General Meeting on May 26, 2016
7
COMPENSATION ELEMENTS DUE OR GRANTED WITH RESPECT TO 2015 TO MR. BERNARD CHARLÈS, CHIEF
EXECUTIVE OFFICER
Compensation elements
Amount
(in euros) Observations
Fixed Compensation
1,325,000 Fixed gross compensation with respect to 2015 set by the Board of Directors on March 20,
2015 (1).
Annual variable compensation
1,523,750 Variable gross compensation with respect to the 2015 actually paid and decided by the
Deferred annual variable
compensation
Multi-year variable
compensation
Directors’ fees (2)
Board of Directors on March 17, 2016 (1).
N/A Mr. Bernard Charlès receives no deferred annual variable compensation.
N/A Mr. Bernard Charlès receives no multi year annual variable compensation.
28,000 Gross amount of directors’ fees due for 2015.
Extraordinary compensation
N/A Mr. Bernard Charlès receives no extraordinary compensation.
Granting of share subscription
options and/or performance
shares
Indemnity upon start or
termination of function
11,653,530 (3) Mr. Bernard Charlès was granted 300,000 2015-B shares by the Board of Directors on
September 4, 2015 (4) (5).
N/A Mr. Bernard Charlès receives under certain conditions an indemnity upon the termination of
his functions, the amount of which would not exceed two years of the Chief Executive
Officer’s compensation and would depend on the satisfaction of the performance conditions
for the payment of his variable compensation.
In accordance with Article L. 225-40-1 and L. 225-42-1 of the French Commercial Code, this
commitment on the part of Dassault Systèmes SE was authorized by the Board of Directors
on May 26, 2014 and approved by the General Meetings on May 28, 2015. The Board of
Directors reviewed this commitment on March 17, 2016 as it remained in effect during
2015 (5 ).
Non-competition-indemnity
N/A Mr. Bernard Charlès receives no non-competition indemnity.
Additional retirement plan
N/A No additional retirement plan was implemented.
Benefits
10,934 These benefits are related to the use of a car provided by Dassault Systèmes SE.
(1) See also paragraph 5.1.4.1 “Compensation of Executive Officers”, and 5.3.1 Table 2 "Summary of the compensation of each Executive Officer".
(2) See also paragraph 5.1.4.4 “Directors’ Fees” on the conditions for distributing the directors’ fees at Dassault Systèmes SE.
(3) Value based on the method chosen for the consolidated financial statements, before the spreading of the expense and taking into account the performance criteria.
(4) Such shares are granted to the Chief Executive Officer as part of the gradual process of associating him with the Company’s capital that began several years ago, with the aim of
recognizing his entrepreneurial role during more than thirty years with the Company and providing him with an equity interest comparable to that of founders of companies in the
same sector, and more generally, of his peers in technology companies around the world.
7
(5 ) See also paragraph 5.1.4.3 “Performance Shares and Share Subscription Options”.
(6 ) See also paragraph 5.1.4.2 “Indemnities Due in the Event of the Imposed Departure (départ contraint) of the Chief Executive Officer”.
Re-appointment of a director
The term as director of Ms. Marie-Hélène Habert, whose
appointment on an interim basis by the Board of Directors on
July 23, 2014 was ratified by the General Meeting of May 28,
2015, expires at General Meeting of May 26, 2016. You are
invited to re-appoint her as a director for a four-year term.
For a presentation of the directors, see paragraph 5.1.1.1
“Composition of the Board of Directors”.
If this proposal is approved, the Board of Directors will still
include four women directors out of its nine members, i.e. a
proportion of 44%, which is greater than that recommended
by the AFEP-MEDEF Code and the law on the representation
of women on Boards of Directors.
The proportion of independent directors (44%) will remain
greater than that recommended by the AFEP-MEDEF Code for
controlled companies.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
205
7 General Meeting
Presentation of the Resolutions Proposed by the Board of Directors to the General Meeting on May 26, 2016
Appointment of one new director
After seeking an opinion from the Compensation and Nomination Committee, the Board of Directors proposes to appoint one
new director, Mrs. Laurence Lescourret.
In compliance with Article R. 225-83 of the French Commerical Code, information regarding the director proposed for nomination
by the General Meeting of Shareholders is set forth below.
MRS. LESCOURRET – DIRECTOR CANDIDATE
Biography: Laurence Lescourret has been an associate professor
at the Finance Department of ESSEC Business School since 2010.
She is also a director of ESSEC’s “Capital Markets and Regulation”
Excellence Center and an affi liate academic researcher at the
Centre de Recherche en Economie et Statistique (CREST).
She holds a PhD in fi nance from HEC Paris (2003), a Master in
management from EDHEC, a Master “104 Finance” from Paris
Dauphine University, and a Master in political economy analysis
from the Ecole d’Economie de Paris. Between 2004 and 2011, she
was fi rst an assistant professor, co-director and ultimately director
of the ESSEC Finance Department. She also taught at ENSAE
between 2000 and 2010.
As an academic researcher, she is the author of several publications
on organizing and regulating capital markets and has received
distinction for her work. She was the 2013 recipient of the Vega
Prize from the Federation of European Securities Exchanges and
received the 2015 award for best research article on derivative
products granted by the IFSID (Montreal Institute of Structured
Finance and Derivatives).
End of current term: General Meeting called to approve the
fi nancial statements for the year ended December 31, 2019.
Dassault Systèmes shares owned at December 31, 2015: 0
Age: 42
Nationality: French
Professional address: ESSEC Business School – Avenue Bernard
Hirsch – 95021 Cergy-Pontoise - France
Main position: Associate professor in the fi nance department –
ESSEC Business School
Other current positions and Directorships:
None
Other positions held during the past five years:
Member of the supervisory board of Groupe ESSEC
Determination of amount of directors’ fees
The General Meeting is invited to increase to €420,000 for the
current and subsequent years, the maximum annual amount
of directors’ fees allocated to directors, which is currently set
at €350,000.
This increase is justified by the necessity to hold an additional
meeting of the Board of Directors since the transformation
of Dassault Systèmes SE into a Societas Europaea, and by
the designation of two additional directors, one of which is
representing the employees.
Auditex (which is a member of the Ernst & Young network)
also expires this year. You are also invited to re-appoint it for
the same term.
In accordance with the law, (i) the Chief Executive Officer did
not participate in the vote of the Board of Directors on this
re-appointment proposal and (ii) the Audit Committee issued
a positive recommendation on the re-appointment proposal.
The amount of the professional fees received by Ernst & Young
et Autres is stated in paragraph 5.5 of this Annual Report
(Document de référence).
Re-appointment of a Principal Statutory Auditor, Ernst
& Young et Autres, and its deputy, Auditex
Ernst & Young et Autres was appointed Principal Statutory
Auditor on May 27, 2010. Since its term of office expires
during the General Meeting called to approve the financial
statements for the year ended December 31, 2015, you are
invited to re-appoint it for a six-year term, until the General
Meeting called to approve the financial statements for the
year ended December 31, 2021. The term of its deputy
Authorization to repurchase shares of the Company
The authorization to repurchase shares of the Company
granted to the Board of Directors at the General Meeting on
May 28, 2015 will expire at the General Meeting of May 26,
2016. Under this authorization, share repurchases were
made in 2015 and at the beginning of 2016 , as described in
paragraph 6.2.5 “Stock Repurchase Programs”. In additions,
repurchases were also made in 2015 and at the beginning
of 2016 to stimulate the market or provide liquidity for the
206 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
General Meeting
Presentation of the Resolutions Proposed by the Board of Directors to the General Meeting on May 26, 2016
7
Company’s shares through the intermediary of an investment
services provider by means of a liquidity contract complying
with a Code of Ethics accepted by the Financial Markets
Authority (AMF) and initially entered into between Dassault
Systèmes SE and Oddo Corporate Finance. This agreement has
been automatically renewed for 2016.
Additional share repurchases may be made until the date of the
General Meeting, and will be described in the Annual Report
(Document de reference) for the year ending December 31,
2016.
We invite you to renew the authorization to the Board of
Directors to repurchase shares of the Company according to
the conditions set forth in Articles L. 225-209 et seq. of the
French Commercial Code, within the limit of 10% of the capital
of the Company at the date of the General Meeting of May 26,
2016, for a maximum purchase price of €100 per share and
within the limits stipulated in the applicable regulations. The
maximum amount of funds dedicated to repurchase shares of
the Company may not exceed €500 million.
Should you approve this proposal, the authorization will be
valid until the annual General Meeting approving the financial
statements for the year ending December 31, 2016.
This authorization to repurchase shares may be used for the
following purposes:
1)
2)
3)
4)
5)
to cancel shares for the purpose of increasing the
profitability of shareholders’ equity and income per
share, subject to adoption by the Extraordinary Meeting
of Shareholders of the resolution permitting shares to be
cancelled;
to provide securities representing no more than 5% of the
share capital of the Company in payment or in exchange,
including external growth transactions;
to stimulate the market or provide liquidity for the
Company’s shares through the
intermediary of an
investment services provider by means of a liquidity
contract complying with a Code of Ethics accepted by the
Financial Markets Authority (AMF);
to perform all obligations related to stock options grants
or other grants of shares to employees or directors of the
Company and its affiliates;
to cover the Company’s commitments pursuant to rights
to cash payments based on increases in the share price of
the Company, granted to the employees and directors of
the Company and its affiliates;
6)
to provide shares upon exercise of rights to the Company’s
share capital which are attached to issued securities;
7)
to implement any stock exchange market practice which
may be recognized by law or by the Financial Markets
Authority (AMF).
The share repurchase program is described in paragraph 6.2.5
“Stock Repurchase Programs”, where all relevant information
is presented.
In light of the possible cancellation of the repurchased shares,
we propose that you also authorize the Board of Directors
to cancel, as the case may be, for the same period, all or a
portion of the shares which it has repurchased and to reduce
in a corresponding amount the share capital, within a limit of
10% of its amount.
Authorizations with respect to the access of the
employees to the share capital
Authorization granted to the Board of Directors by the General
Meeting to grant options to subscribe or to purchase shares
on May 30, 2013 expires on July 30, 2016. You are invited to
reauthorize the Board of Directors to grant options to subscribe
or to purchase shares.
This authorization would be granted for a period of 38 months,
and the maximum number of options that may be granted by
the Board of Directors that are still unexercised could not give
a right to subscribe or acquire a number of shares exceeding
5% of capital. Information relating to the uses by the Board of
Directors of the authorization granted in 2013 by the General
Meeting, and to all Dassault Systèmes SE option plans is
contained in paragraphs 6.2.4 “Delegations and Authorizations
Granted to the Board of Directors by the General Meetings”
and 5.3.2 “Interests of Executive Management and Employees
in the Share Capital of Dassault Systèmes SE”.
This authorization would supersede, for the unused portion,
the prior authorizations granted to the Board of Directors.
In accordance with the law and as a result of the proposal to
authorize the granting of options to subscribe or purchase
shares, there will also be a proposal to enable the Board of
Directors to carry out capital increases reserved for employees
of the Company and/or of associate companies and members
of Company savings plans. The maximum nominal amount of
the capital increases that may be carried out through the issue
of new shares or securities giving access to capital would be
€5 million. This new authorization will cancel and replace the
one given by the General Meeting of September 4, 2015.
Furthermore, pursuant to the AFEP-MEDEF Code and the
recommendation of the Nomination and Compensation
Committee, it is proposed to cap the number of options that
could be granted to executive officers within the meaning of
this Code at 35% of the authorized overall amount.
7
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Amendments to by-laws
The General Meeting is invited to make two series of
amendments to the Dassault Systèmes SE by-laws.
The purpose of these revisions is to take into account the
provisions relating to the director representing employees
described in Article L. 225-27-1 of the French Commercial
Code, to which the Company will be subject because, as of
December 31, 2015, the Group has had more than 10,000
employees for the second consecutive year.
It is in this framework that the General Meeting is required
to approve the amendment of the Company by-laws to
anticipate the terms for the appointment of the director
representing employees on the Board of Directors. Because
the Board of Directors of Dassault Systèmes SE has fewer than
12 members, only one director representing employees shall
be appointed within six months of the General Meeting, i.e.,
by November 26, 2016.
The draft amendment to the by-laws, prepared by the Board of
Directors to be submitted to the vote of the General Meeting,
states that the director representing employees shall be
appointed by the trade union organization that has obtained
the most votes in the first round of the elections for Works
Council members.
This method of appointment allows for fair representation of
the employees on the Board.
The Dassault Systèmes SE Works Council was consulted in
accordance with the law, and it issued an opinion with respect
to the method of appointment selected.
In addition, we propose to modify the articles of association
of Dassault Systèmes SE in order to extend to 85 years old,
the maximum age of the President of the Board of Directors,
and to allow the Board of Directors to appoint a Vice-Chairma n
if it deems fit. Should this draft resolution be adopted by
the General Meeting on May 26, 2016, the C ompensation
and N omination C ommitee will recomme nd to the Board to
appoint Bernard Charlès as Vice-Chairma n of the Board.
information about the proposed
You can find further
resolutions in the draft resolutions submitted hereafter to you.
7.2 Draft Resolutions Proposed by the Board
of Directors to the General Meeting
on May 26, 2016
Ordinary General Meeting
❘ First resolution
❘ Second resolution
Approval of the parent company annual financial statements
Approval of the consolidated financial statements
The General Meeting, after the reading of the management
report of the Board of Directors and the report of the Statutory
Auditors, in addition to the explanations made orally, hereby
approves the report of the Board and the parent company
annual financial statements for the year ended December 31,
2015, as they have been presented.
The General Meeting consequently approves any transactions
disclosed by such financial statements or summarized in such
reports and in particular, in accordance with the provisions of
Article 223 quater of the French Tax Code, the fact that there
is no non-deductible tax expenses and charges referred to in
Article 39.4 of the French Tax Code, and that consequently
such transactions did not give rise to corporate income tax.
The General Meeting, after the reading of the report of the
Board of Directors with respect to management of the Group
included in the management report and the report related to the
consolidated financial statements of the Statutory Auditors,
in addition to the explanations made orally, hereby approves
in all respects the report of the Board and the consolidated
financial statements for the year ended December 31, 2015,
as they have been presented.
The General Meeting consequently approves any transactions
disclosed by such consolidated financial statements or
summarized in such reports.
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❘ Third resolution
Allocation of the results
The General Meeting, upon the proposal of the Board of Directors, hereby resolves to allocate the profit of the year amounting to
€299,471,748.73(1) as follows:
(cid:125) to the legal reserve
(cid:125) for distribution to the 256,850,348 shares making up the share capital as of February 29, 2016 of a dividend
of (€0.47 euro × 256,850,348 shares)(2)
to retained earnings
which, increased by the retained earnings from prior years of €1,784,847,265.29, brings the amount of retained
earnings to
€17,505.45
€120,719,663.56
€178,734,579.72
€1,963,581,845.01
(1) After allocation to the legal reserve, this profit increased by the retained earnings from prior years of €1,784,847,265.29, results in a distributable profit of €2,084,301,508.57.
(2) The aggregate amount of the dividend will be increased, based on the number of new shares created between March 1, 2016 and the date of the General Meeting of May 26,
2016, consecutively to the exercise of subscription options, it being specified that the maximum number of shares which could be issued upon the exercise of subscription options
is 2,872,387, i.e., a maximum amount of a supplementary dividend of €1,350,021.89.
Shares will be traded ex-dividend as of June 2, 2016 and
dividends made payable as from June 24, 2016.
On the date of payment, the amount of the dividend
corresponding to (i) the treasury shares of Dassault Systèmes
SE and (ii) the treasury shares of Dassault Systèmes SE held
by SW Securities LLC, a company which is controlled by the
Dassault Systèmes Group, as of the date of payment, shall
be allocated to “retained earnings”, in accordance with the
provisions of Article L. 225-210 of the French Commercial
Code and the contractual provisions in force between SW
Securities LLC and Dassault Systèmes SE.
In addition, prior to distribution of the dividend, the Board of
Directors, or if so delegated, the Chief Executive Officer will
determine the number of additional shares issued as a result of
the exercise of shares subscription options between March 1,
2016 and the date of this General Meeting; the amount
required for payment of dividends for shares issued during this
period shall be taken from “retained earnings”.
The amount thus distributed may be taken into account
for determining shareholders’ total revenue subject to the
progressive rate of income tax for the year during which it was
received after application of an uncapped deduction of 40%
(as provided by Article 158-3-2 of the French Tax Code). The
dividend shall be subject to a non discharging withholding of
the income tax to the rate of 21% (as provided by Article 117
quater of the French Tax Code).
Pursuant to Article 243 bis of the French Tax Code, it is noted that dividends per share paid over the last three years have been
as follows:
7
Dividend (in euros)
Number of shares eligible for dividends
2014
0.43
2013
0.83
2012
0.80
255,644,058 126,746,027* 125,572,474*
*
The number of shares was given before the two-for-one stock split of the Dassault Systèmes SE share on July 17, 2014.
❘ Fourth resolution
Option to receive payment of dividends in the form of shares
The General Meeting, after the reading of the Board of
Directors’ report, and finding that the capital is fully paid up,
decides to offer each shareholder the possibility of choosing,
in whole or in part, to receive payment of the dividend decided
in the third resolution, and to which he is entitled, in the form
of new shares in the Company.
Each shareholder may decide, in whole or in part, to receive
payment of the dividend in cash or in shares.
If the shareholder chooses to receive payment of the dividend
in the form of shares, the new shares will be issued without
a discount at a price equal to the average of the closing prices
quoted on the regulated market of Euronext Paris during the
20 stock exchange sessions preceding the date of the General
Meeting less the net amount of the dividend decided in the
third resolution rounded up to the next one hundredth of a
euro. Such new shares will be eligible for dividends as from
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Draft Resolutions Proposed by the Board of Directors to the General Meeting on May 26, 2016
January 1, 2016, and will have all the rights and privileges
with the other shares issued by Dassault Systèmes SE.
Shareholders may choose in whole or in part, payment of the
dividend in cash or new shares between June 2 and June 15,
2016, inclusive, by sending their request to the financial
intermediaries that are authorized to pay the dividend or, for
shareholders listed in the direct registered share accounts held
by the Company, to its authorized representative (Société
Générale, securities department, 32 rue du Champ de Tir,
CS 30812, 44308 Nantes Cedex 3). Failing exercise of such
option as at June 15, 2016 at the latest, the dividend will only
be paid out in cash.
Shareholders who have not chosen payment of dividends
in shares before the end of this period or who have chosen
only partial payment, will receive the dividend in cash for the
portion for which payment in shares was not chosen as from
June 24, 2016. For shareholders who have chosen to receive
payment of the dividend in shares, the new shares will be
delivered as of the same day.
If the amount of dividend for which payment in the form
of shares has been chosen does not correspond to a whole
number of shares, the number of shares to be received by
the shareholder will be rounded up to the next whole number
with the shareholder paying the difference in cash on the
day he/she chose to receive payment in the form of shares,
or alternatively the number of shares to be received by the
shareholder will be rounded down to the next whole number
and the shareholder will receive the balance in cash.
The General Meeting gives full powers to the Board of
Directors, with the right of sub delegation to the Chairman of
the Board under the conditions provided by law, to carry out
the payment of dividends in new shares, to stipulate the terms
of application and implementation, to record the number
of new shares issued under this resolution, to make any
necessary changes in the Company’s by-laws relating to the
share capital and the number of shares it contains, and, more
generally, to do whatever may be appropriate or necessary.
❘ Fifth resolution
Related-party agreements (conventions réglementées)
The General Meeting, having reviewed the special report
of the Statutory Auditors on the agreements governed by
Articles L. 225-38 et seq. of the French Commercial Code,
acknowledges the report, which did not include any new
agreements .
2015 to Mr. Charles Edelstenne, Chairman of the Board of
Directors, as indicated in the 2015 Annual Report (Document
de référence), under Chapter 5 “Corporate Governance”,
paragraph 5.3.1 “Compensation of the Company’s Corporate
Officers (mandataires sociaux)”.
❘ Seventh resolution
Advisory opinion on the compensation elements due or
granted with respect to 2015 to Mr. Bernard Charlès, Chief
Executive Officer
The General Meeting issues a favorable opinion on the
compensation elements due or granted with respect to 2015 to
Mr. Bernard Charlès, Chief Executive Officer, as indicated in the
2015 Annual Report (Document de référence), under Chapter 5
“Corporate Governance”, paragraph 5.3.1 “Compensation of
the Company’s Corporate Officers (mandataires sociaux)”.
❘ Eighth resolution
Re-appointment of Ms. Marie-Hélène Habert as director
The General Meeting notes that Ms. Marie-Hélène Habert’s
term as director expires at this General Meeting and re-appoints
her for a four-year period. This term of office will expire at the
General Meeting approving the financial statements for the
year ending December 31, 2019.
❘ Ninth resolution
Appointment of a new director
The General Meeting decides to appoint Mrs. Laurence Lescourret
as director of the Company for a four-year term. This term
of office will expire at the General Meeting approving the
financial statements for the year ending December 31, 2019.
❘ Tenth resolution
Determination of the amount of directors’ fees
The General Meeting sets forth the amount of the directors’
fees to be distributed among the directors at €42 0,000 for
the current and subsequent years, until otherwise decided
by the General Meeting. It gives all powers to the Board of
Directors to allocate the directors’ fees, in whole or part, under
conditions that it shall determine.
❘ Sixth resolution
❘ Eleventh resolution
Advisory opinion on the compensation elements due or
granted with respect to 2015 to Mr. Charles Edelstenne,
Chairman of the Board of Directors
The General Meeting issues a favorable opinion on the
compensation elements due or granted with respect to
Re-appointment of a Principal Statutory Auditor
The General Meeting, after the reading of the report of the
Board of Directors, decides to re-appoint Ernst & Young et
Autres, whose registered office is located at 1-2 place des
Saisons – Paris la Défense 1 – 92400 Courbevoie, France, as
Principal Statutory Auditor for a term of six years, until the
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7
General Meeting called to approve the financial statements for
the year ending December 31, 2021.
Ernst & Young et Autres has already indicated that it accepted
its re-appointment.
❘ Twelfth resolution
Re-appointment of a Deputy Statutory Auditor
The General Meeting, after the reading of the report of the
Board of Directors, decides to re-appoint Auditex, whose
registered office is located 1-2 place des Saisons – Paris la
Défense 1 – 92400 Courbevoie, France, as Deputy Statutory
Auditor for a term of six years, until the General Meeting
called to approve the financial statements for the year ending
December 31, 2021.
Auditex has already
appointment.
indicated that
it accepted
its re-
❘ Thirteenth resolution
Authorization to repurchase shares of Dassault Systèmes SE
The General Meeting, after the reading of the report of the Board
of Directors, authorizes the Board of Directors to repurchase a
number of shares representing up to 10% of the share capital
of Dassault Systèmes SE at the date of the General Meeting, in
accordance with the terms and conditions provided by Articles
L. 225-209 et seq. of the French Commercial Code.
This authorization may be used by the Board of Directors for
the following purposes :
to cancel shares for the purpose of increasing the
profitability of shareholders’ equity and earnings per
share, subject to adoption by the Extraordinary General
Meeting of the four teenth resolution;
to provide securities (representing no more than 5%
of the share capital of the Company) in payment or in
exchange, particularly in connection with external growth
transactions;
to animate the market and provide liquidity of the
Company’s shares through the
intermediary of an
investment services provider by means of a liquidity
contract complying with an Ethical Code accepted by the
Financial Markets Authority (AMF);
to perform all obligations related to stock options grants
or other grants of shares to employees or directors of the
Company and its affiliates;
to ensure coverage of the Company’s commitments
resulting from rights granted to the employees and
directors to cash payments based on increases in the
share price of the Company;
to provide shares upon exercise of rights to the Company’s
share capital which are attached to issued securities;
1)
2)
3)
4)
5)
6)
7)
The acquisition, sale, transfer or exchange of such shares may
be effected by any means allowed on the market (whether
or not the market is regulated), multilateral trade facilities
(MTF) or through a systematic internalizer or over the counter,
in particular acquisition of blocks, and at the times deemed
appropriate by the Board of Directors or any person acting
pursuant to a sub delegation and according to the law.
Such means shall include (i) use of available cash flow, (ii)
the use of any derivative financial instrument negotiated on
a market (whether or not the market is regulated), MTF or
through a systematic internalizer or over the counter, and (iii)
the implementation of optional transactions (purchase and
sale of options, provided however that the use of these means
does not create a significant increase of the volatility of the
stock exchange price).
The maximum amount of funds dedicated to repurchase of
shares of the Company may not exceed €500 million, this
condition being cumulative with the cap of 10% of the capital
of the Company.
Dassault Systèmes SE may not purchase shares at a price
per share which exceeds €100 (excluding acquisition costs),
and in any case the price per share shall not exceed the
maximum price provided by the applicable legal rules, subject
to adjustments in connection with transactions on its share
capital, in particular by capitalization of reserves and free
allocation of shares and/or regrouping or split of shares.
This authorization can be used by the Board of Directors for all
the treasury shares held by Dassault Systèmes.
This authorization shall be valid commencing on the date
of this General Meeting until the Ordinary General Meeting
approving the financial statements for the year ending
December 31, 2016. The General Meeting hereby grants
any and all powers to the Board of Directors with option of
delegation when legally authorized, to place any stock orders
or orders outside the market, enter into any agreements,
prepare any documents including information documents,
determine terms and conditions of Company transactions on
the market, as well as terms and conditions for purchase and
sale of shares, file any declarations, including those required
by the Financial Markets Authority (AMF), accomplish any
formalities, and more generally, carry out any necessary
measures to complete such transactions.
The General Meeting also grants any and all powers to the
Board of Directors, in case that the law or the Financial
Markets Authority (AMF) appear to extend or to complete
the authorized objectives concerning the share repurchase
program, in order to inform the public, pursuant to applicable
regulations and laws, about the potential changes of the
program concerning the modified objectives.
In accordance with the provisions of Articles L. 225-211 and
R. 225-160 of the French Commercial Code, the Company
or the intermediary in charge of securities administration for
the Company shall keep registers which record purchases and
sales of shares pursuant to this program.
7
to implement any stock exchange market practice which
may be recognized by law or by the Financial Markets
Authority (AMF).
This authorization shall replace and supersede the previous
share repurchase program authorized by the Combined
General Meeting of May 28, 2015, in its fourteenth resolution.
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Extraordinary General Meeting
❘ Fourteenth resolution
Authorization granted to the Board of Directors to reduce the
share capital by cancellation of previously repurchased shares
in the framework of the share repurchase program
The General Meeting, after the reading of the report of the
Board of Directors and the special report of the Statutory
Auditors, hereby authorizes the Board of Directors, pursuant to
the provisions of Article L. 225-209 of the French Commercial
Code, to:
(cid:125) reduce the share capital by cancellation, in one or several
transactions, of all or part of the shares repurchased by the
Company pursuant to its share repurchase program, up to a
limit of 10% of the share capital over periods of twenty-four
months;
(cid:125) deduct the difference between the repurchase value of
the canceled shares and their nominal value from available
premiums and reserves.
The General Meeting hereby gives, more generally, any
and all powers to the Board of Directors to set the terms
and conditions of such share capital reduction(s), record the
completion of the share capital reduction(s) made pursuant
to the cancellation transactions authorized by this resolution,
amend the by-laws of the Company as may be necessary, file
any declaration with the Financial Markets Authority (AMF)
or other institutions, accomplish any formalities and more
generally take any necessary measures for the purposes of
completing this transaction.
This authorization is granted to the Board of Directors for
a period ending at the end of the General Meeting called
to approve the financial statements for the year ending
December 31, 2016.
❘ Fifteenth resolution
Authorization granted to the Board of Directors to grant
options to subscribe or to purchase shares to the corporate
officers (mandataires sociaux) and employees of Dassault
Systèmes SE and its affiliated entities giving rise by virtue
of law, to a waiver by the shareholders to the preferential
subscription right
The General Meeting, after review of the report of the Board
of Directors and the special report of the Statutory Auditors:
1) authorizes the Board of Directors, under the provisions
of Articles L. 225-177 et seq. of the French Commercial
Code, to grant options giving rights to the subscription of
new shares or the purchase of existing shares (“Options”)
to the employees and corporate officers (mandataires
sociaux) of the Company or companies affiliated with it as
defined by Article L. 225-180 of the French Commercial
Code, or those among them that individually hold less
than 10% of the capital of the Company (“Beneficiaries”);
2) decides that this authorization shall be granted for a term
of 38 months from the date of this meeting;
3) decides that the maximum number of Options that
may be granted by the Board of Directors that are still
unexercised may not give a right to subscribe or acquire a
number of shares exceeding 5% of capital. This limit shall
be assessed at the time that the Options are granted by
the Board and take into account not only the new options
thus offered, but also from those that would result from
the previous grants that remain unexercised;
4) decides that the maximum number of Options that may
be granted to executive officers (dirigeants mandataires
sociaux) under the AFEP-MEDEF Code shall represent no
more than 35% of the overall amount authorized by this
General Meeting;
5) decides that the list of the grantees of the Options among
the Beneficiaries and the number of Options granted to
each of them shall be freely determined by the Board of
Directors;
6) notes that, in accordance with the law, that no Option
to subscribe or purchase may be granted during the
periods prohibited by Article L. 225-177 of the French
Commercial Code;
7) decides that the subscription price of the new shares or
the purchase price of existing shares through the exercise
of Options shall be determined by the Board of Directors
on the date that the Options are granted and that (i)
should share subscription options be granted, the price
thereof may not be less than 80% of the average trading
price of the share on the Euronext Paris market during
the twenty trading sessions preceding the date when the
Options will be granted and (ii) should share purchase
options be granted, the price thereof may not be less than
the value indicated in (i) above or the average purchase
price of the shares referred to in Article L. 225-179 of the
French Commercial Code.
The exercise price of the Options as determined above
may not be modified unless the Company performs one
of the financial transactions or securities trades referred
to in Article L. 225-181 of the French Commercial Code.
In this case, the Board of Directors will, pursuant to the
laws and regulations in force, adjust the exercise price and
the number of shares that may be acquired or subscribed
by exercising the Options, as applicable, to take into
account of the impact of the transaction;
8) notes that this authorization constitutes, for the
Beneficiaries of the share subscription options, an
express waiver by the shareholders of their pre-emptive
subscription right to the shares that may be issued as the
Options are exercised;
9) gives all powers to the Board of Directors for the purpose
of setting the terms and conditions for the Options, which
include but are not limited to the following:
(cid:125) the period of validity of the Options, with the
understanding that the Options must be exercised within
a maximum period of 10 years,
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(cid:125) the date(s) or periods for the exercise of the Options,
with the understanding that the Board of Directors may
(a) bring forward the dates or periods for the exercise
of Options, (b) extend the exercisability of the Options
or (c) modify the dates or periods during which the
shares obtained through the exercise of Options may be
transferred or converted into bearer shares,
(cid:125) any clauses that prohibit the immediate resale of all or
part of the shares obtained through the exercise of the
Options, and such time limit imposed for the lock-up
of shares may not exceed three years from the exercise
of the Option, without prejudice to provisions of Article
L. 225-185, paragraph 4 of the French Commercial Code,
(cid:125) as appropriate,
limiting, suspending, restricting or
prohibiting the exercise of Options or the transfer or
conversion into bearer form of the shares obtained
through the exercise of the Options, for certain periods
or after certain events, and such a decision may affect
some or all of the Options or shares or some or all of the
Beneficiaries,
(cid:125) determining the dividend eligibility date, retroactive or
otherwise, for the new shares from the exercise of share
subscription options;
10) decides that the Board of Directors shall also have, with
the option to delegate under the conditions set by law,
all powers to record the capital increases in the amount
of the shares that shall be actually subscribed by the
exercise of the subscription Options, amend the by-laws
accordingly, and, at its sole discretion, if it considers it
appropriate, deduct the fees involved in carrying out the
capital increases from the premiums relating to these
capital increases as well as the sums necessary to increase
the legal reserve to one-tenth of the new share capital
after each capital increase, and carry out all formalities
necessary for the listing of the securities thus issued and
all declarations with any bodies and do anything else that
may be necessary;
11) decides that this authorization supersedes as of this date
the unused portion of the similar authorization granted
by the sixteenth resolution of the Combined General
Meeting of May 30, 2013.
❘ Sixteenth resolution
Authorization of the Board of Directors to increase the share
capital for the benefit of members of a corporate savings plan,
without pre-emptive rights
The General Meeting, having reviewed the report of the
Board of Directors and the special report of the Statutory
Auditors, pursuant to the provisions of Articles L. 3332-1
et seq. of the French Labor Code and Articles L. 225-138-1
and L. 225-129-6, first and second paragraphs, of the French
Commercial Code:
1) authorizes the Board of Directors to increase the share
capital of the Company, in one or several transactions,
at its sole discretion, by a maximum nominal amount
of €5 million through the issue of new shares or other
securities giving access to the share capital of the
law,
Company under the conditions prescribed by
reserved for members of corporate savings plans of the
Company and/or its affiliated entities within the meaning
of Articles L. 225-180 of the French Commercial Code
and L. 3344-1 of the French Labor Code;
2) stipulates to eliminate the pre-emptive rights of
shareholders to subscribe for the new shares to be
issued or other securities giving access to share capital
and securities to which these securities give entitlement
under this resolution for the benefit of the members of
the plans referred to in the previous paragraph and waives
the rights to the shares or other securities that would be
allocated through the application of this resolution;
3) stipulates that the maximum nominal amount that may
be issued under this authorization shall be included in
the maximum nominal amount for capital increases of
€12 million set under the sixteenth resolution of the
General Meeting of May 28, 2015;
4) stipulates that the subscription price for the new shares
will be at least 80% of the average listed price of the
Company’s shares on Euronext Paris in the 20 trading
days preceding the day on which subscriptions open,
where the lock-up period set by the savings plan in
accordance with Article L. 3332-25 of the French Labor
Code is shorter than ten years, and 70% of this average
where the lock-up period is ten years or more. However,
the General Meeting of Shareholders expressly authorizes
the Board of Directors, if it deems it appropriate, to reduce
or cancel the above-mentioned discounts, within the legal
and regulatory limits, in order to take account of, inter
alia, the legal, accounting, tax and social security rules
applicable locally;
5) stipulates that the Board of Directors may also replace all
or part of the discount with the free allocation of shares
or other securities giving access to the share capital
of the Company, whether existing or to be issued, it
being specified that the total benefit resulting from this
allocation and, if applicable, from the discount mentioned
above, cannot exceed the total benefit that members of
the savings plan would have received if this difference
had been 20% or 30%, depending on whether the lock-
up period set by the plan is greater than or equal to ten
years;
6) stipulates that the Board of Directors may proceed, in
accordance with Article L. 3332-21 of the French Labor
Code, the free allocation of shares or other securities
giving access to the share capital of the Company to be
issued or already issued under a bonus scheme, provided
that the inclusion of their monetary value, valued at the
subscription price, does not result in the legal or regulatory
limits being exceeded;
7) stipulates that the characteristics of the other securities
giving access to the share capital of the Company will be
determined by the Board of Directors according to the
conditions laid down by the regulations;
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8) stipulates that the Board of Directors will have all the
necessary powers, with the option for delegation or sub-
delegation, in accordance with the legal and regulatory
provisions, within the limits and under the conditions
specified above, to determine all the terms and conditions
of transactions and, in particular, to decide on the amount
to be issued, the issue price and the terms of each issue,
and to define the terms for the free allocation of shares or
other securities giving access to share capital, in application
of the authorization given above, to determine the
opening and closing dates for subscriptions, to set, within
the maximum limit of three years, the period granted to
subscribers to pay for their shares, to determine the date,
which may be retroactive, from which the new shares
will be eligible for dividends, to apply for their admission
to listing on the stock market wherever they are advised
to do so, to record the capital increase in the amount of
shares effectively subscribed for, to make all necessary
arrangements to carry out the capital increases, carry out
all formalities arising therefrom and amend the by-laws
accordingly, and at its sole discretion, and if it deems it
appropriate, to deduct the fees involved in carrying out
the capital increases from the premiums relating to these
capital increases as well as the sums necessary to increase
the legal reserve to one-tenth of the new share capital
after each capital increase;
9) stipulates that this authorization cancels and replaces
all previous authorizations relating to capital increases
reserved for members of corporate savings plans, and
in particular, that granted by the General Meeting of
September 4, 2015 in the second resolution;
10) the authorization thus granted to the Board of Directors is
valid for 26 months from the date of this General Meeting.
❘ Seventeenth resolution
Amendments to by-laws
The General Meeting, after review of the report of the Board of
Directors, decides to:
1. amend paragraphs 1 and 3 of Article 14 of the by-laws
“Board of Directors”, which states as follows:
“Article 14 – Board of Directors
1. Composition
The Company shall be administered by a Board of
Directors established in accordance with the Law.
Directors shall be appointed and their positions renewed
by an ordinary shareholders meeting, which may remove
them at any time.
However, in the event of merger or split-up, d irectors may
be appointed by an extraordinary shareholders meeting.
Directors may be individuals or legal entities. Directors
who are legal entities must, at the time of their
appointment, designate a permanent representative, who
shall be subject to the same conditions and obligations
and who shall incur the same civil and criminal liability as
if he were a d irector on his own behalf, without prejudice
to the joint and several liability of the legal entity that
he represents. This mandate of permanent representative
shall be given to him for the duration of the mandate of
the legal entity that he represents; it must be renewed
whenever the mandate of the legal entity is renewed.
When the legal entity revokes its representative, it must
so notify the Company, immediately, by registered letter
and appoint a new permanent representative under the
same terms; the same shall hold true in the event of death
or resignation of the permanent representative.
An individual d irector may have multiple mandates in a
board of directors or supervisory board, in so far as the
rules of Law are complied with.
An employee of the Company may be appointed as
d irector only if his/her employment contract predates
his appointment and that the contract corresponds to an
actual job. The number of d irectors bound to the Company
by an employment contract may not exceed one third of
the d irectors in office.”
[…]
“3. Vacancy of Seats – Cooptation
In the event of vacancy due to the death or resignation
of one or more of the directors, the Board of Directors
may make temporary appointments between two
Shareholders Meetings.
However, if only one or two directors remain in office, such
director or directors, or otherwise the auditor(s), must
immediately convene the Ordinary Shareholders Meeting
to fill the remaining seats on the Board of Directors.
Provisional appointments made by the Board of
Directors shall be subject to confirmation by the next
Ordinary Shareholders Meeting. In the absence of such
confirmation, the resolutions adopted and the acts
accomplished previously by the Board of Directors shall
remain valid nevertheless.
A director appointed in replacement of another shall
remain in office only for the un-elapsed remainder of his
predecessor’s term of office.”
2. add a paragraph 4 to Article 14 of the by-laws “Board of
Directors”, entitled “Director representing employees”,
which states as follows:
“4. Director representing employees
In accordance with Article L. 225-27-1 of the French
Commercial Code, the Board of Directors also includes a
director representing employees appointed by the trade
union organization that has obtained the highest number
of votes in the first round of the elections referred to in
Articles L. 2122-1 and L. 2122-4 of the French Labor
Code in the Company and its direct or indirect subsidiaries
whose registered office is located on French territory.
The failure to appoint a director representing employees
pursuant to and under the conditions of the law and this
214 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
General Meeting
Draft Resolutions Proposed by the Board of Directors to the General Meeting on May 26, 2016
7
article does not impair the validity of the deliberations of
the Board of Directors.
The term of office of a director representing employees
is four years.
The term of office of the director representing employees
shall expire at the end of the General Meeting called to
approve the parent company financial statements for the
previous year held during the year in which his or her
term of office expires.
In the event of vacancy of a director representing
employees, for whatever reason, his or her replacement
shall be appointed according to the same procedure as the
director in question and shall remain in office only for the
remainder of his or her predecessor’s term. Up to the date
of such replacement, the Board of Directors may meet
and deliberate validly.
If, at the close of a year, the provisions of Article L. 225-27-
1 of the French Commercial Code are no longer applicable
to the Company, the term of the director representing
employees expires at the end of the Ordinary General
Meeting called to approve the financial statements for
that year.
Paragraphs 1 to 3 of this Article shall not apply to the
director representing employees, with the exception of the
rules on simultaneous offices referred to in paragraph 1
and the rules relating to reappointment referred to in
paragraph 2.
Subject to the provisions of this Article or of the provisions
of the law, the director representing employees has the
same status, rights and responsibilities as other directors.”
3. amend paragraphs 1 and 3 of Article 15 of the by-laws
“Chairmanship – Organization of the Board of d irectors”
as follows:
"1. From among its individual members, the Board of
Directors shall elect a Chairman and set his term of office,
which term may not exceed his term of office as Director.
The Board of Directors may also, under the same
conditions, elect a Vice-Chairman.
The Chairman may not be more than eighty-five years
of age. Should he exceed this age limit , he shall be
considered to have resigned automatically.
In the case of a temporary incapacity or death of the
Chairman, the Vice-Chairman shall serve as Chairman on
an interim basis and, in the event that no Vice Chairman
has been appointed, the Board of Directors may appoint a
Director to assume the role of Chairman. The replacement
of the Chairman by the Vice-Chairman or by the delegate
shall end on the date of resumption of the duties of the
Chairman or as the case may be, upon the election of a
new Chairman.”
[…]
“3. Should the Chairman be absent or unavailable to
preside over a meeting of the Board of Directors, the
Vice-Chairman shall serve as Chair, and in the event that
no Vice-Chairman has been appointed, the Board shall
appoint, for that relevant meeting, one of its members
present to chair the meeting.”
4. amend the title of Article 20 as follows:
"Article 20 - Compensation of Directors, the Chairman
of the Board of Directors, the Vice-Chairman, Senior
Management, agents of the Board of Directors and
members of committees."
5. amend paragraph 2 of Article 20 of the by-laws
"Compensation of Directors, the Chairman of the Board of
Directors, the Vice-Chairman, Senior Management, agents
of the Board of Directors and members of committees"as
follows:
The compensation of the Chairman of the Board of
Directors and the compensation of the Directeur general,
and, as the case may be, the compensation of the
Vice-Chairman and the Directeurs généraux délégués,
shall be determined by the Board of Directors. It may be
fixed or proportional, or both."
7
6. amend the first item of the second paragraph of Article 28
"General Meetings - Secretariat - Minutes" as follows:
"Shareholders meetings shall be chaired by the Chairman
of the Board of Directors. In his absence, such meetings are
chaired by the Vice-Chairman or by a Director specifically
delegated by the Board of Directors for that purpose."
The other provisions of the By-laws remain unchanged.
. Ordinary and Extraordinary General Meeting
❘ Eigh teenth resolution
Powers for formalities
The General Meeting hereby grants any and all powers to the bearer of an original, a copy or an excerpt of the minutes of these
deliberations for the purpose of carrying out any legal formalities for publication.
DASSAULT SYSTÈMES ANNUAL REPORT 2015
215
T Cross-reference tables
Annual fi nancial report
CROSS-REFERENCE TABLES
Annual fi nancial report
The cross-reference table below allows to identify the information included in the annual financial report provided by the
Article L. 451-1-2 of the Monetary and Financial French Code and by the Article 222-3 of the General Regulation of the Autorité
des marchés financiers.
Annual financial report
1. Parent Company Financial Statements
2. Consolidated Financial Statements of the Group
3. Management Report
4. Certification of the Person Responsible for the Reference Document
5. Statutory Auditors Report on the Parent Company Financial Statements
6. Statutory Auditors Report on the Consolidated Financial Statements
7. Principal Accountants Fees and Services
Reference Document
Paragraphs
4.2
4.1
Pages
124
86
See Annual Management report
cross-reference table below
–
4.2.3
4.1.2
5.5
3
146
122
184
216 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Cross-reference tables
Annual management report
T
Annual management report
The cross-reference table below identifies in the Reference Document the information included in the annual management report
to be provided by the Company’s Board of Directors, as required by Articles L. 225-100 et seq. of the French Commercial Code.
Annual management report
1. Business Trends Analysis
2. Analysis of Results
3. Financial Operations Analysis
4. Description of Main Risks and Uncertainties
5. Financial Instruments Use
6. Risk Factors such as Pricing, Credit, Liquidity in Cash and Treasury
7. Current Delegations to the Board of Directors and their Use during the Fiscal Year 2015
8.
9.
Information Required by the Article L. 225-100-3:
Possible Consequences in Case of a Public Tender Offer
Information Required by the Article L. 225-211 of the French Commercial Code,
Relating to the Shares Repurchases
10. Situation during the Fiscal year 2015
11. Foreseeable Trend of the Situation
12. Substantial Events Occurred since the End of 2015
13. Research & Development Activities
14. Business and Results of Operations of the Parent Company Dassault Systèmes SE
15. Business and Results of the Parent Company’s Subsidiaries during the Fiscal Year 2015
16. 2016 Business Outlook
17. Selected Financial Information of Dassault Systèmes SE over the Last Five Fiscal Years
18. Employees’ Involvement in the Capital of the Issuer the Last Day of the Fiscal Year
19. Compensation and Benefits Granted to each Director (mandataires sociaux)
of Dassault Systèmes in 2015
20. List of the Terms and Responsibilities of the Directors (mandataires sociaux)
of Dassault Systèmes in 2015
21. Social and Environmental Information
Reference Document
Paragraphs
Pages
3.1
3.1
3.1
1.6
72
72
72
28
4.1.1 – Notes 2, 21
92, 113
1.6.2
6.2.4
5.1.7.2
6.2.5
3.1, 4.1, 4.2
3.1.1.1, 3.2
4.2.1 – Note 23
1.5
1.3, 1.4, 4.2
1.3.2, 1.4
3.1.1.1, 3.2
4.2.2
6.3.1
5.3
5.1.1.1
2
35
191
170
193
72, 86, 124
72, 83
143
27
12, 14,124
13, 14
72, 83
145
194
172
152
37
22. Equity Holdings or Controlled Companies, Subsidiaries with a French Head-Office
4.2.1 – Notes 1, 24
128, 144
23. Table of Transactions in the Company’s Shares by the Management of the Company
24. Information on the Payment Cycles for Suppliers
25. Chairman of the Board’s Report on Corporate Governance and Internal Control
26. Dividends Paid over the Last Three Fiscal Years
5.4
4.2.1 – Note 19
5.1
7.1
181
141
152
202
T
DASSAULT SYSTÈMES ANNUAL REPORT 2015
217
T Cross-reference tables
Cross-reference table including the European Directive no. 809/2004 – Annex 1 items
Cross-reference table including the European Directive no. 809/2004 – Annex 1 items
The cross-reference table below identifies the information included in the Reference Document, and reflects the transposition of
the European Directive no. 809/2004 in its Annex 1, adopted by the European Commission of April 29, 2004.
European directive – Annex 1 items
Reference Document
Paragraphs
Pages
1.
2.
3.
4.
5.
6.
7.
8.
PERSONS RESPONSIBLE
1.1 Name and function of the persons responsible
1.2 Declaration of the persons responsible
STATUTORY AUDITORS
SELECTED FINANCIAL INFORMATION
RISK FACTORS
INFORMATION ABOUT THE ISSUER
5.1 History and development of the Company
5.2
Investments
BUSINESS OVERVIEW
6.1 Principal activities
6.2 Principal markets
6.3
6.4
Exceptional factors
Extent to which the issuer is dependent on patents or licenses, industrial,
commercial or financial contracts or new manufacturing processes
6.5 Basis for any statements made by the issuer regarding its competitive position
ORGANIZATIONAL STRUCTURE
7.1 Brief description of the Group
7.2
List of the significant subsidiaries
PROPERTY, PLANT AND EQUIPMENT
8.1
Existing or planned material tangible fixed assets
8.2 Any environmental issues that may affect the issuer’s utilization
of the tangible fixed assets
OPERATING AND FINANCIAL REVIEW
9.
10. CAPITAL RESOURCES
11. RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES
12. TREND INFORMATION
13. PROFIT FORECASTS OR ESTIMATES
14. ADMINISTRATIVE, MANAGEMENT AND SUPERVISORY BODIES
AND SENIOR MANAGEMENT
14.1
Information relating the Board of Directors and Senior Management
14.2 Administrative, Management and Supervisory Bodies
and Senior Management Conflicts of Interests
15. REMUNERATION AND BENEFITS
3
3
184
6
28
8
11
14
18
28
14
12
13
5.5
1.1
1.6
1.2.1
1.2.2
1.4.1
1.4.2
None
1.6
1.4.1
1.3.1
1.3.2
2.2.2.3,
4.1.1 – Notes 14,
25
60,107,119
2.2.2.3
3.1
3.1.4
1.5
1.6.1.1
3.2
60
72
83
27
28
83
5.1.1, 5.1.2
5.1.3
152, 162
163
15.1 Amount of remuneration paid and benefits in kind
5.3
15.2 Amount set aside or accrued to provide pension, retirement or similar benefits
5.3.1 – Table 11
172
176
218 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Cross-reference tables
Cross-reference table including the European Directive no. 809/2004 – Annex 1 items
T
European directive – Annex 1 items
16. BOARD PRACTICES
16.1 Date of expiration of the current term of office
16.2 Service contracts with the issuer
16.3
Information about the committees
Reference Document
Paragraphs
5.1
5.1.1.1
5.1.3
5.1.1.3
Pages
152
152
163
160
16.4 Statement of compliance with the regime of corporate governance
5.1, 5.1.5
152, 166
17. EMPLOYEES
17.1 Number of employees
17.2 Shareholdings and stock options
17.3 Arrangement involving the employees in the issuer’s capital
18. MAJOR SHAREHOLDERS
18.1 Shareholders having more than 5% of interest in the issuer’s capital or of voting rights
18.2 Existence of different voting rights
18.3 Control of the issuer
18.4 Arrangement, known to the issuer, the operation of which may
at a subsequent date result in a change in control of the issuer
19. RELATED PARTY TRANSACTIONS
20. FINANCIAL INFORMATION CONCERNING THE ISSUER’S ASSETS
AND LIABILITIES, FINANCIAL POSITION AND PROFITS AND LOSSES
20.1 Historical Financial Information
20.2 Pro forma Financial Information
20.3 Financial Statements
20.4 Auditing of Historical Annual Financial Information
20.5 Date of the latest financial statements
20.6
Interim and Other Financial Information
20.7 Dividend Policy
20.8 Legal and Arbitration Proceedings
20.9 Significant Change in the Issuer’s Financial or Trading Position
21. ADDITIONAL INFORMATION
21.1 Share Capital
21.2 Memorandum and By-laws
22. MATERIAL CONTRACTS
23. THIRD-PARTY INFORMATION, EXPERTS’ STATEMENTS
AND DECLARATION OF ANY INTEREST
24. DOCUMENTS AVAILABLE TO THE PUBLIC
25.
INFORMATION ON HOLDINGS
2.1.1
5.1.1, 5.3.2
39
152,176
None
6.3
6.3.1
6.1.2.3
6.3.2
6.3.3
194
194
188
196
197
4.1.1 – Note 26,
4.2.4, 7.1
120,148,202
4.1
86
Not applicable
4.1, 4.2
86, 124
4.1.2, 4.2.3, 4.2.4
122, 146, 148
December 31,
2015
3.3
7.1
4.3
None
6.2, 6.3
6.1.2
1.4.3
Not applicable
84
202
150
189,194
187
26
T
6.1.1.6
186
1.3.2, 4.1.1 –
Note 27,
4.2.1 – Note 24
13, 121,144
DASSAULT SYSTÈMES ANNUAL REPORT 2015
219
T Cross-reference tables
NRE correspondence table
NRE correspondence table
Article R. 225-105-1 of the French Commercial Code items
EMPLOYMENT
Total employees and distribution by gender, age and geographic location
New hires and departures
Compensation
ORGANIZATION OF WORKING TIME
Absenteeism
LABOR RELATIONS
Organization of employee relations and employee communications,
consultation and negotiation procedures
Summary of collective agreements
HEALTH AND SAFETY
Health and safety conditions
Summary of agreements reached with labor unions
or employee representatives regarding health and safety
Work accidents frequency and seriousness, and professional illnesses
TRAINING
Training policies
Total training time
EQUAL TREATMENT
Measures for the equal treatment of women and men
Measures for the employment of disabled persons
Anti-discrimination policy
PROMOTION OF AND RESPECT FOR THE PROVISIONS OF THE BASIC CONVENTIONS
OF THE INTERNATIONAL LABOR ORGANIZATION ON
Respect for the freedom of association and the right to collective negotiation
Eliminating discrimination at work
Eliminating forced labor
Eliminating child labor
INFORMATION ON SOCIETAL COMMITMENTS
AND COMMITMENTS TO SUSTAINABLE DEVELOPMENT
Regional, economic and social impact of the business in terms of employment
and regional development, on nearby or local populations
Relations with individuals and organizations interested by the Company’s business
(job placement associations, educational establishments, environmental protection
associations, etc.), partnership and sponsorship
Sub-contractors and suppliers: social responsibility. Taking social and environmental issues
into account in the purchasing policy. Importance of sub-contracting. Taking suppliers’ and
sub-contractors’ social and environmental responsibility into account in relations with them
Good citizen practices (actions to prevent corruption and measures to protect the health
and safety of consumers) and other measures to support human rights
GENERAL POLICY ON ENVIRONMENTAL ISSUES
Organizing the Company to take into account environmental issues.
If need be, environmental assessment or certification processes
Employee training and information actions regarding environmental protection
Resources devoted to the prevention of environmental risks and pollution
Amount of provisions and guarantees for environmental risks
220 ANNUAL REPORT 2015 DASSAULT SYSTÈMES
Reference Document
Paragraphs
Pages
2.1.1, 2.1.7
2.1.2, 2.1.7
39,56
42,56
2.1.4
2.1.1
2.1.5
2.1.5
2.1.5
2.1.5
2.1.5
2.1.2
2.1.2
2.1.2
2.1.2
2.1.2
2.1.5
2.1.2
2.1.5
2.1.5
2.1.2
2.1.2
2.1.1
2.1.5
2.2.1
2.2.3
2.2.6
2.2.6
50
39
52
52
52
52
52
42
42
42
42
42
52
42
52
52
42
42
39
52
58
65
67
67
Article R. 225-105-1 of the French Commercial Code items
POLLUTION AND WASTE MANAGEMENT
Measures for preventing, recycling or eliminating waste
SUSTAINABLE USE OF RESOURCES
Water consumption
Consumption of raw materials
Measures taken to improve the efficiency of the use of raw materials
Energy consumption
Measures taken to improve energy efficiency and the use of renewable energy
CLIMATE CHANGE
Greenhouse gas emissions
Cross-reference tables
NRE correspondence table
T
Reference Document
Paragraphs
Pages
2.2.2.5 and 2.2.4
61, 65
2.2.2.5
2.2.2.5 and 2.2.4
2.2.2.5 and 2.2.4
2.2.2.5
2.2.2.5
2.2.2.5
61
61, 65
61, 65
61
61
61
Information not published due to lack of relevancy
Explanation
Frequency/severity rate of work accidents.
Professional illnesses.
Consideration of noise pollution
Land use
Water supply in accordance with local constraints
Adaptation to the consequences of climate change
Biodiversity protection
Given the nature of Dassault Systèmes’ activity, the number of work
accidents is low and consists of only a few cases per year.
This indicator is not calculated.
Given Dassault Systèmes’ activity, these topics are not covered.
The Group is not aware of any noise pollution that could negatively
impact the environment, nor is it aware of any impact on biodiversity.
With regards to land use, the Group is only a commercial user,
and the Group is not aware of any local constraints with regards
to water supply. The Group does not believe that it is at risk
with regards to climate change in the near-or mid-term.
T
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224 ANNUAL REPORT 2015 DASSAULT SYSTÈMES