AVEVA : Preliminary Results Statement

PRESS RELEASE

AVEVA GROUP PLC

RESULTS FOR THE YEAR ENDED 31 MARCH 2021

Strong second half performance following a Covid-affected first half

Strategic position further enhanced following acquisition of OSIsoft

AVEVA Group plc ('AVEVA' or 'the Group') announces its preliminary results for the year ended 31 March 2021.

On 19 March 2021, the Group announced the completion of the acquisition of OSIsoft, LLC ('OSIsoft) enhancing AVEVA's ability to accelerate the digital transformation of the industrial world.

The statutory results1 reflect 12 months of trading for standalone AVEVA and 13 days of trading for OSIsoft since the acquisition. To provide a better understanding of the combined trading performance and to improve transparency, non-statutory results are also shown for the combined Group on a pro forma 12-month basis2; and summary results are shown for the AVEVA and OSIsoft business on a 12-month standalone basis.

We believe that the pro forma results for the combined Group give the most insight both into the historic performance of the Group as it is structured today and the most appropriate basis from which to consider the outlook.

Highlights

Statutory results

• Revenue was £820.4m (FY20: £833.8m) including £803.0m from AVEVA and £17.4m from OSIsoft.
• Profit from operations was £36.6m (FY20: £95.0m).
• Proposed final dividend of 23.5 pence, representing a small increase versus the prior year after adjusting for the rights issue bonus factor.

Combined AVEVA Group on a 12-month pro forma basis (unaudited)

• On an organic constant currency basis3 pro forma revenue for the combined Group grew 2.2%, with both the standalone AVEVA business and OSIsoft delivering double digit revenue growth in the second half of the financial year.
• Pro forma constant currency Annualised Recurring Revenue (ARR)4 increased 8.6% to £704.8m (FY20: £648.9m).
• Pro forma revenue reduced by 1.4% to £1,196.1m (FY20: £1,213.2m) and adjusted5 EBIT grew 8.1% to
  £354.7m (FY20: £328.1m), representing a margin of 29.7% (FY20: 27.0%).
• The standalone AVEVA business was resilient, achieving revenue growth of 0.2% on an organic constant currency basis, while increasing recurring revenue as a percentage of total revenue to 67.9% (FY20: 62.2%) and adjusted EBIT margin to 27.1% (FY20: 26.0%).
• The standalone OSIsoft business performed well, strengthening its growth as the year progressed to achieve full year revenue growth of 6.6% on an organic constant currency basis, while increasing recurring revenue as a percentage of total revenue to 64.8% (FY20: 59.2%) and adjusted EBIT margin to 34.8% (FY20: 29.3%).
• The business environment has improved in most major markets following the disruption caused by Covid- 19 in the first half of FY20 and the board is confident in the outlook for AVEVA in FY22.

Chief Executive Officer, Peter Herweck said:

"The last year has been transformational for AVEVA. The Group reacted quickly to the Covid crisis, so that despite a challenging first half, the second half saw double-digit revenue growth. At the same time, our transition to Subscription continues at pace.

The acquisition of OSIsoft has established AVEVA as a clear global leader in operational industrial software, further enhancing our ability to lead the digital transformation of the industrial world, with a more diversified customer base, supporting their energy transition and sustainability journeys.

Initial customer feedback on the combination of AVEVA and OSIsoft has been extremely positive and I look forward to capturing the significant value opportunity over the coming years. Although early in the financial year, trading has started well for the enlarged AVEVA Group and it is performing in-line with our expectations."

Summary results

Year ended 31 March	2021	2020	Change
Combined AVEVA Group on a 12-month pro forma basis (unaudited)
Revenue	£1,196.1m	£1,213.2m	(1.4)%
AVEVA	£803.0m	£833.8m	(3.7)%
OSIsoft	£393.1m	£379.4m	3.6%
Annualised recurring revenue	£704.8m	£648.9m	8.6%
Adjusted EBIT	£354.7m	£328.1m	8.1%
AVEVA	£218.0m	£216.8m	0.6%
OSIsoft	£136.7m	£111.3m	22.8%
Profit before tax	£50.6m	£19.0m	166.3%
Adjusted profit before tax	£338.7m	£299.0m	13.3%
Adjusted diluted earnings per share	105.3p	94.1p	11.9%
AVEVA Group plc statutory results
Revenue	£820.4m	£833.8m	(1.6)%
Profit from operations	£36.6m	£95.0m	(61.5)%
Adjusted EBIT	£226.4m	£216.8m	4.4%
Diluted earnings per share 7	11.27p	34.60p	(67.4)%
Adjusted diluted earnings per share	81.31p	86.75p	(6.3)%

Notes

1. Statutory results include the results for the standalone AVEVA Group for the 12 months to 31 March 2021 and results for OSIsoft since the acquisition date, compared to the results of the standalone AVEVA business only for FY20.
2. FY21 combined Group pro forma results include results for both AVEVA and OSIsoft for the 12 months to 31 March 2021, as if the acquisition of OSIsoft and the associated financing had occurred at the start of FY20.
3. Organic constant currency revenue excludes a currency translation reduction of £31.2 million; and adjusts for the disposals of Wonderware Italy, Germany and Scandinavia.
4. The annualised value of recurring revenue streams including Maintenance, Subscription and Cloud contracts.
5. Adjusted metrics are calculated before amortisation of intangible assets (excluding other software), share-based payments, gain/loss on fair value of forward foreign exchange contracts and exceptional items. Adjusted Earnings Per Share also includes the tax effects of these adjustments.
6. Recurring revenue is defined as subscription revenue plus maintenance revenue.
7. Basic and diluted EPS figures for the standalone AVEVA in comparative periods have been restated and adjusted for a bonus factor of 0.8 to reflect the bonus element of the November 2020 rights issue.

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Enquiries:

AVEVA Group plc

Matt Springett, Head of Investor Relations Tel: [phone]

FTI Consulting LLP

Edward Bridges / Dwight Burden Tel: [phone]

Conference call details

AVEVA will host a conference call for registered participants, at 09:30 (BST) today.

Conference calls dial in details:

UK: 020 3936 2999

USA: 1 646 664 1960

All other locations: [phone]

Conference call code: 848591

A replay of the call will be made available later in the day.

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Chairman's Statement

Overview

The last year was one of strong progress for AVEVA, despite the challenges posed by the Covid-19 pandemic. The Group adapted swiftly to the new operating environment, with the business demonstrating resilience. Although the first half of the financial year was significantly impacted by disruption, business improved in the second half as our customers and employees got used to new ways of working.

We continued to invest in AVEVA's future growth increasing our investment in core areas of Research & Development, such as Cloud and Artificial Intelligence, while completing the acquisition of OSIsoft, a global leader in real-time industrial data software and services.

We are proposing a final dividend of 23.5 pence per share, which represents a small increase after adjusting for the bonus factor in relation to the rights issue.

Strategic developments

Three years after the combination of heritage AVEVA and the Schneider Electric industrial software business created a global leader in industrial software, AVEVA acquired OSIsoft, further enhancing the Group's ability to accelerate the digital transformation of the industrial world, as a leading independent, hardware-agnostic software company. I would like to extend a warm welcome from the Board to all our new colleagues who have joined the Group from OSIsoft.

Combining the complementary product offerings of AVEVA and OSIsoft, which brings together industrial software applications with the market-leading industrial data platform, will enable AVEVA to broaden and deepen its relationships with customers, while further diversifying the Group's end markets and developing its ability to assist customers on their energy transition journeys. This is expected to result in substantial revenue synergies, in addition to £20 million of cost synergies.

We continue to align all aspects of our business to ESG best practice, creating products that meet the current and future needs of our customers whilst ensuring that we are encouraging an organisational ethos that embraces diversity and inclusion, such that AVEVA remains a great place to work and an employer of choice in a highly competitive marketplace.

Board developments

As I covered in my Statement last year, Emmanuel Babeau resigned as a Non-Executive Director, Vice Chairman of the Board and member of the Remuneration Committee effective 30 April 2020. Emmanuel was replaced by Olivier Blum as a Non-Executive Director and member of the Remuneration Committee. Peter Herweck assumed the role of Vice Chairman on the same date.

Peter Herweck stepped up to become AVEVA's CEO on 1 May 2021. He is very familiar with AVEVA's business having served on AVEVA's Board since 2018 and was instrumental in the creation of the AVEVA Group as it is now structured. Peter played a key role in both bringing together AVEVA and the Schneider Electric industrial software business and more recently AVEVA and OSIsoft.

Craig Hayman stepped down as CEO on 1 May and will retire from the Board following our AGM in July. During his three-year tenure, Craig has overseen the successful integration of the Schneider Electric industrial software business, the progress of the Group to a FTSE100 position, and the completion of the acquisition of OSIsoft. The Board would like to thank Craig for his service as CEO and wish him all the best for the future.

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Summary

The Board would also like to thank all our employees for their hard work and flexibility over the last year, particularly given the additional challenges arising from the Covid crisis. We also thank our customers, shareholders and other stakeholders for their continued support, and we look forward to a successful future together.

Philip Aiken AM

Chairman

25 May 2021

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