DGAP-News: TeamViewer AG / Key word(s): Quarterly / Interim Statement TeamViewer AG: TeamViewer confirms preliminary Q3/9M results with healthy and profitable billings growth 2021-11-03 / 07:30 The issuer is solely responsible for the content of this announcement.

-----------------------------------------------------------------------------------------------------------------------

GOPPINGEN, GERMANY, 3 November 2021

TeamViewer confirms preliminary Q3/9M results with healthy and profitable billings growth . Billings growth at constant currencies of 18% in Q3 and 21% in 9M . Adjusted EBITDA Margin of 34% in Q3 and 48% in 9M, including planned brand investments . Growth to 628,000 subscribers, lower churn rate and higher NRR . Enterprise business accelerated its growth sequentially, up by 75% to EUR 77.8m billings on LTM basis,now representing 15% of total billings . Major partnerships with SAP and Google Cloud to drive Augmented Reality enterprise business . Strong financial profile with net leverage stable at 1.5x Adjusted EBITDA . Full-year guidance confirmed Key Figures 


EUR m, unless otherwise stated             Q3 21 Q3 20 ?     ? cc^1 9M 21 9M 20 ?    ? cc^1 
Billings (non-IFRS)                        125.8 106.4 +18%  +18%   393.9 332.1 19%  21% 
Adj. EBITDA (non-IFRS)                     42.3  58.2  -27%         189.3 189.3 +0% 
Adj. EBITDA Margin (%)                     33.6% 54.7% -21pp        48.1% 57.0% -9pp 
Revenue (IFRS)                             127.7 117.2 +9%          368.8 334.6 +10% 
Revenue from subscription model (non-IFRS) 127.4 108.1 +18%         366.3 294.9 +24% 
Levered Free Cash Flow                     32.5  29.7  +9%          89.8  109.4 -18% 
Subscribers (thousand, 30 Sept.)           628   567   +11% 
Employees (FTE, 30 Sept.)                  1,506 1,213 +24%

1) At constant currency

«We are clearly coming out of a challenging quarter. While billings growth and profit remain very attractive, we are not satisfied with those results. We will address this by reconfiguring some of our growth initiatives and our cost structure, which we will present in more detail at our Capital Markets Day. TeamViewer is well positioned to capitalize on global megatrends with strong positions in key growth markets and a broadened solutions portfolio combined with our compelling financial profile. The entire leadership team is fully convinced of the long-term growth prospects.»

_______

Oliver Steil, TeamViewer CEO

«We are pleased to finally see a normalization of the business activity post COVID effects. Our profitability continues to be one of the highest in the industry, our cash position is consistently strong and the leverage ratio low. The improvement of our Net Retention Rate and the increase of the average billings per customer reflect a positive momentum. This together with the steps we are taking to re-adjust TeamViewer's growth levers make us confident that we will deliver on our short- and mid-term ambitions.» _______

Stefan Gaiser, TeamViewer CFO

Business Update

TeamViewer has confirmed its preliminary Q3 results from the beginning of October. The company grew third quarter billings by 18% (18 cc^1) to EUR 125.8m compared to the same period last year and after 15% billings growth in Q2 2021. TeamViewer's first nine months billings in 2021 grew by 18% and 21% cc to EUR 393.9m compared to previous year's 9M period. TeamViewer thereby achieved to grow its billings by more than 75% within two years (9M 2019: EUR 224.3m). Adjusted EBITDA decreased to EUR 42.3m (Q3 2020: EUR 58.2m) due to the already communicated billings shortfall and significant planned investments in brand in Q3, ultimately resulting in an Adjusted EBITDA margin of 34% (Q3 2020: 55%).

TeamViewer increased its subscriber base by 11% year-over-year to 628,000 at quarter end. The enterprise business continued to grow very strongly by 75% on a last twelve-month (LTM) basis to EUR 77.8m, thereby accelerating its growth sequentially (Q2 2021: +66% LTM). Within the enterprise business, the share of contracts with value >EUR 50k moved from 34% in Q3 2020 to 48%, reflecting successful up- and cross-selling. Total subscriber churn improved from 15.7% in Q3 2020 to 14.6% in Q3 2021. ^1 At constant currencies

Broadened Solutions Portfolio to Attract Customers Across All Verticals

TeamViewer successfully broadened its solutions portfolio through strategic acquisitions and R&D investments in existing and new products. These efforts enable TeamViewer to further drive digitalization along the entire value chain and continue to attract new high-profile customers across all verticals such as global leading B2B coffee machine manufacturer Gruppo Cimbali and major Nordics telecom operator Tele2. In addition, TeamViewer won the largest Augmented Reality (AR) deal in the company's history to help one of the major U.S. car manufacturers in digitalizing its after-sales workflows and field service management using TeamViewer's frontline AR solutions. With the launch of TeamViewer Classroom, the company entered the promising sector of digital education with a fully GDPR-compliant online teaching solution dedicated to the needs of educational institutions.

Strategic Industry and Tech Partnerships to Address Growing Enterprise Demand

Recently, TeamViewer entered a strategic partnership with Google Cloud to bring its AR solutions to the Google Cloud platform. The first jointly developed solution is a hands-free order picking application that leverages Google Glass Enterprise Edition 2 equipped with TeamViewer's vision picking software from the Frontline AR suite. Through this partnership, TeamViewer and Google Cloud are co-developing and co-marketing enterprise AR solutions to better meet customer needs. The partnership is aimed to be extended to improve manufacturing, logistics, and supply chain processes within other industries. Moreover, TeamViewer Frontline was successfully certified as an SAP Endorsed App and is now available on the SAP(R) Store. Joint sales activities have been started, too. Both partnerships prove that TeamViewer's technology is highly relevant to complex use cases in the enterprise sector and plays a major role in the global tech ecosystem.

Financial Overview

TeamViewer's billings of EUR 125.8m in the third quarter and EUR 393.9m in the first nine months represent 18% and 21% cc growth compared against the respective prior year periods, which saw significant extra demand following the outbreak of the pandemic especially in the first six months. The Net Retention Rate improved significantly to 99% in Q3 after the decline in Q2 2021 (88%) due to post-COVID lower renewal values. At the end of September 2021, NRR stood at 96% on a LTM basis (98% cc).

Revenue from the subscription business model, which is now representing 99% of total revenues, increased by 18% to EUR 127.4m in the third quarter and by 24% to EUR 366.3m in the first nine months. However, revenue from discontinued perpetual licenses decreased by EUR 8.9m compared to the prior-year period to EUR 0.2m for Q3 and by EUR 37.2m to EUR 2.5m for the nine months-period. This depressed overall revenue growth to 9% year-over-year in Q3 2021 and 10% in the first nine months of the year. This effect will largely disappear by the end of Q4 2021.

TeamViewer's most mature market, EMEA, showed strong third quarter billings growth of 25% (24% cc), billings in the Americas grew by 17% (17% cc). APAC billings were below expectations with EUR 16.1m. Billings and Revenue per Region 


EUR m                Q3 21 Q3 20 ?   ? cc^1 9M 21 9M 20 ?   ? cc^1 
Billings (non-IFRS)  125.8 106.4 18% 18%    393.9 332.1 19% 21% 
EMEA                 60.0  48.0  25% 24%    210.6 172.9 22% 22% 
AMERICAS             49.6  42.3  17% 17%    133.0 113.3 17% 23% 
APAC                 16.1  16.1  0%  0%     50.3  46.0  9%  11% 
Revenue (IFRS)       127.7 117.2 9%         368.8 334.6 10% 
EMEA                 69.0  63.7  8%         197.6 183.2 8% 
AMERICAS             43.4  38.0  14%        125.6 108.5 16% 
APAC                 15.2  15.5  -2%        45.6  43.0  6% 1) At constant currency

The Adjusted EBITDA stood at EUR 42.3m in the third quarter and EUR 189.3m in the first nine months, corresponding to an Adjusted EBITDA margin of 34% and 48%, respectively. The marked decline in the third quarter (Q3 2020: Adjusted EBITDA margin of 55%) was mainly driven by brand investments compared to the same period of the previous year. This investment combined with the lower-than-expected billings growth and the effect of the discontinued perpetual licence model revenues resulted in a decrease of operating profit (IFRS) at EUR 18.3m (Q3 2020: EUR 43.8m). Net profit was at EUR 3.7m (Q3 2020: EUR 31.6m) in line with the development of the operating profit.

Levered free cash flow in Q3 2021 amounted to EUR 32.5m (Q3 2020: EUR 29.8m) and benefitted from strong cash conversion as well as significantly lower capex and interest payments. For the first nine months, levered free cash flow decreased by 18% to EUR 89.8m. Main drivers were planned payments for marketing partnerships and higher tax payments. During the third quarter 2021, cash and cash equivalents increased by EUR 36.9m to EUR 502.5m. The net leverage ratio was at 1.5x Adjusted EBITDA.

Outlook

TeamViewer confirms the outlook provided together with the pre-release of Q3 2021 financials on October 6 this year. Full year 2021 billings are expected in a range between EUR 535m to EUR 555m and revenue between EUR 495m to EUR 505m.

This assumes a US Dollar exchange rate of 1.20 per EUR and broadly stable other currencies. The adjusted EBITDA margin for the current business year is expected to be at 44% to 46%. Additional information

This Quarterly Statement and all information therein are unaudited.

Webcast

(MORE TO FOLLOW) Dow Jones Newswires

November 03, 2021 02:30 ET (06:30 GMT)