Bentley Systems shares rise 2.9% after Q3 profit beat

Bentley Systems (BSY) topped third-quarter profit estimates and raised its constant currency ARR growth range to 12.5% to 13.5%.

Shares rose 2.9% at 3:59 p.m. ET, from a $43.64 close.

Revenue of $421.51 million was in line with the $424.84 million consensus estimate. Total revenues rose 12.2% from a year earlier, or 12.7% on a constant currency basis.

Here's how the company did:

• Adjusted EPS: 36 cents vs. 27 cents a year earlier, against 33 cents expected
• Net income per diluted share: 29 cents vs. 18 cents a year earlier
• Total revenues: $421.51 million vs. $375.55 million a year earlier
• Free cash flow: $101.4 million vs. $110.7 million a year earlier

Subscriptions revenues were $386.8 million, up 12.4% from a year earlier, or 12.9% on a constant currency basis.

Operating income margin was 29.1%, compared with 22.5% a year earlier. AOI less Operating SBC was 32.1% of revenue, compared with 28.1%.

Raised ARR growth range

The raised range excludes the impact of the Cohesive divestiture.

Annualized recurring revenues reached $1,582.8 million at Sept. 30, up from $1,405.2 million a year earlier. Constant currency ARR growth was 13%.

The dollar-based net retention rate for the last twelve months was 110%, compared with 109% a year earlier.

Revenues excluding the Cohesive divestiture, AOI less Operating SBC and free cash flow remain on track within their outlook ranges.

CFO Werner Andre said the company has "ample financial flexibility to fund programmatic acquisitions, return capital through dividends and opportunistic share repurchases, and repay our 2027 convertible notes at maturity." Net debt leverage stood at 1.7 times.

Deals completed in October

On Oct. 13 it divested Cohesive, a business providing IBM Maximo-related implementation and consulting services, by contributing it to Naviam, an IBM Maximo partner. In exchange it received an equity interest in Naviam and warrants to acquire additional equity interests in it.

On Oct. 29 it acquired Eliis, a seismic interpretation software company. The company expects the acquisition to complement its Seequent subsurface portfolio.

Nine-month results

Total revenues for the nine months ended Sept. 30 were $1,256.4 million, up 13.2% from a year earlier. Adjusted EPS was $1.09, against $0.94 a year earlier, and net income per diluted share was 83 cents, compared with 67 cents.

Operating cash flow for the nine months was $374.4 million, compared with $396.9 million a year earlier. Trailing twelve-month free cash flow was $489.3 million, compared with $460.1 million.