MUNICH (dpa-AFX) - The construction software manufacturer Nemetschek has come through the first quarter better than feared. Although the restructuring towards software subscriptions had a significant impact on earnings, the figures turned out better than experts had expected. Design and construction software was particularly convincing. "With the first quarter, we have created a good basis for achieving our goals for the full year," said CEO Yves Padrines. The stock rose sharply on Thursday.

The stock rose by a good five percent in the morning to 65.82 euros, which meant second place in the MDax. Although the share price is a long way from the record level of just over 116 euros in mid-2021, it has recovered to some extent since the interim low below 43 euros in the fall of 2022. Like so many technology shares, Nemetschek also went down last year, after the fantasy of investors around the tech industry in 2021 had caused a flight to the top and strong premiums. The group is currently worth more than seven billion euros on the stock market.

The start of the year has been better than expected, wrote analyst Knut Woller of Baader Bank. However, it is still unclear to him how strongly the economic problems have been reflected in the figures, after all, the design division has benefited from one-off effects.

For some time now, Nemetschek has been preparing investors for the fact that sales growth and earnings are unlikely to develop as strongly this year as in previous years, which were also driven by acquisitions. The group is currently in the process of converting its numerous brands into subscription models, which reduces the high one-off contributions from license sales and puts pressure on earnings. In the coming year, however, Nemetschek wants to achieve double-digit percentage growth in revenue again.

In the first three months, sales increased by 6.5 percent year-on-year to 204.6 million euros, as the Munich-based company announced. This was more than analysts had expected. In the design division with software for architects and engineers, there were follow-up effects from the previous quarter, it was said. In addition, customers had taken an announced price increase at the end of the quarter as an opportunity to bring forward their contracts. By contrast, the consequences of the gloomy market environment, particularly in Europe, and the longer sales cycles had slightly stabilized the situation in the division.

In the building segment, in which Nemetschek offers, among other things, software for the comprehensive use of building plans for construction companies, sales fell slightly. The important Bluebeam brand has been converting its business to subscriptions and cloud use for some time. The division's operating profit plunged by nearly a quarter. In software for building management, Nemetschek was able to increase sales. The market situation had stabilized slightly, even if the investment volume of building managers was still below the pre-crisis level, it said.

The small but usually strongly growing division with media software for film and video game productions achieved a comparatively small increase in sales of five percent in the first quarter. According to the company, a particularly high comparative value from the same period of the previous year was decisive for this. At that time, an acquisition in addition to the last sale of licenses in China had ensured high growth rates. In the second quarter of the year, Nemetschek wants to achieve double-digit percentage growth in the division again.

There was a damper on the Group's operating result due to the switch to subscriptions. Earnings before interest, taxes, depreciation and amortization fell by 12.7 percent to 61 million euros. Below the line, net profit fell by almost 15 percent to 36.3 million euros. However, profits were not as weak as had been feared on the market.

The management team headed by Padrines confirmed its forecast for the full year. In 2023, the plan is for currency-adjusted sales growth of 4 to 6 percent, while the operating margin is likely to be in the range of 28 to 30 percent, which is lower than in previous years. For the coming years, Nemetschek has already held out the prospect of a return to faster growth with higher margins./men/mis/jha/