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TeamViewer AG: Q1 2021 – TeamViewer prepares the ground for long-term growth and achieves record billings

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DGAP-News: TeamViewer AG / Key word(s): Quarterly / Interim Statement
04.05.2021 / 06:45
The issuer is solely responsible for the content of this announcement.

GOPPINGEN, GERMANY, 4 MAY 2021

Q1 2021: TeamViewer prepares the ground for long-term growth and achieves record billings
 

 

Key Figures

EUR m,
unless otherwise stated

Q1 2021

Q1 2020

Δ yoy

Δ cc1

Billings (non-IFRS)

146.6

119.7

+22%

+26%

Adj. EBITDA (non-IFRS)

90.0

73.9

+22%

 

Adj. EBITDA Margin (%)

61.4%

61.7%

-0.3pp

 

Revenue (IFRS)

118.3

102.7

+15%

 

Levered Free Cash Flow

25.0

35.2

-29%

 

Subscribers (thousand LTM)2

603

514

+17%

 

Employees (FTE, 31 March)

1,378

928

+49%

 

1) Growth at constant currency 2) Last twelve months as of 31 March

 

«In the first quarter, we have continued our remarkable growth path, while setting the strategic course to build a truly global tech brand. We are delivering sustainable growth combined with high profitability and will continue to do so which underpins the strength of our business model. With two landmark sport partnerships we are investing significantly in our brand as well as in the marketing of our broadened solutions portfolio across all customer segments. Together with our investments in the enterprise segment and our recent acquisitions in adjacent markets, these strategic decisions put TeamViewer in a pole position to grow stronger for longer – to the benefit of all our stakeholders.»

_______

Oliver Steil, TeamViewer CEO

«On top of an outstanding growth against an extremely strong comparative quarter last year, we were also able to significantly drive our ESG agenda in the first three months of 2021. We embedded ESG in our financing, set the target to become climate neutral by 2030 latest and have received the confirmation by leading sustainability scientists that our offering helps our customers and users to significantly reduce their carbon footprint.»

_______

Stefan Gaiser, TeamViewer CFO

 

Q1 2021 Business Update

In the first quarter of 2021 TeamViewer recorded billings growth at constant currencies of 26% to EUR 146.6m. This is on top of an exceptionally strong Q1 in the prior year driven by significant extra demand after the outbreak of the COVID-19 pandemic. As a result, TeamViewer grew its Q1 billings by nearly 50% on average over two consecutive years. Adjusted EBITDA increased to EUR 90.0m, up 22% year-on-year, leading to a very strong adjusted EBITDA margin of 61.4%. This underlines TeamViewer’s unique financial profile of high growth combined with exceptional profitability.

Key growth drivers for TeamViewer were the strong customer retention and continued expansion of the enterprise business. TeamViewer’s subscriber base grew to 603,000, including 2,058 enterprise customers with a yearly contract value above EUR 10,000. Increasingly, large organizations are using TeamViewer for operational technology (OT) use cases including IoT and Augmented Reality (AR) technology. For example, Mitsubishi Electric Europe uses TeamViewer’s AR support solution in its offices across Central and Eastern Europe to enhance customer support experience and improve repair processes for their industrial control systems, drives, and robots. Switzerland-based global technology company Bühler Group has implemented TeamViewer’s enterprise solution including AR for remote maintenance and commissioning of critical infrastructure for production outlets across the globe.

Through two strategic acquisitions, TeamViewer further expanded its addressable market in the first quarter and invested in long-term growth. With the acquisition of Xaleon, TeamViewer entered the customer engagement space. Only three months later, its operations and technology are fully integrated, and the new solution suite TeamViewer Engage has been introduced to the market. It enables seamless digital customer interaction from first contact to closing contracts in virtual conversations. The second acquisition of Upskill, the US pioneer for industrial AR solutions, strengthens TeamViewer’s global leadership in enterprise AR solutions across all verticals and has significantly expanded the visibility and reach in the US, TeamViewer’s largest market.

To turn TeamViewer into a global tech brand, the company signed strategic five-year partnerships with two of the most successful and well-known sports brands in the world: football club Manchester United and Mercedes racing teams in formula 1 and formula E. Both partners have a very large global fanbase including APAC and the Americas as major growth regions. These landmark partnerships will enable TeamViewer to present its brand and its technology across all customer segments – through prominent brand placements across various assets and channels, through activation in social media and at live events, and through high-end hospitality for relationship-building. Another focus will be the joint creation of case studies that showcase how TeamViewer’s technology supports both teams on their path to digital transformation.

Moreover, TeamViewer hired new senior talent: The company appointed Lisa Agona as new global CMO and member of the management board which underscores the relevance of the marketing function for TeamViewer. In addition, senior enterprise software executive Patricia Nagle joined as new President Americas to further accelerate business development and expansion in the Americas region. Both new hires started in Q2.

 

Outlook

Operating in the very attractive growth markets around digitalization, connectivity, and industry 4.0 solutions, TeamViewer is best positioned to grow across all customer segments. The company has put comprehensive initiatives in place to further penetrate these markets and foster sustainable long-term growth targeting more than EUR 1bn billings in 2023 and continued high billings growth of at least 25% after 2023.

Following a strong first quarter, TeamViewer confirms its 2021 outlook and projects reported billings in a range of EUR 585m and EUR 605m and revenue to be in a range between EUR 525m and EUR 540m, assuming a US Dollar exchange rate of 1.20 per EUR and broadly stable other currencies. As announced in March 2021, the company expects an adjusted EBITDA margin of 49% to 51% for fiscal year 2021.

 

Financial Results

TeamViewer achieved record billings of EUR 146.6m in the first quarter 2021, up 22% year-on-year and up 26% adjusted for currency effects. Subscriber retention was a key focus in the first quarter and TeamViewer’s customer support and sales teams very successfully retained a large number of subscribers that were added in the first wave of global lockdowns in 2020. The net retention rate remained strong with 100%.

The expanded enterprise customer base contributed EUR 58.7m of billings during the last twelve months ending 31 March 2021, up 90% compared to the twelve-month period ending on 31 March 2020 (EUR 31.0m). At the same time, the share of contracts with annual values of EUR 50,000 or more has increased to 41% from 32% a year earlier. TeamViewer benefits form a well-diversified go to market model covering all customers segments which has shown strong growth across the EMEA and Americas regions and solid performance in APAC.

Billings and Revenue per Region

EUR m

Q1 2021

Q1 2020

Δ yoy

Δ cc1

Billings (non-IFRS)

146.6

119.7

+22%

+26%

EMEA

86.7

68.8

+26%

+27%

AMERICAS

44.9

38.1

+18%

+28%

APAC

14.9

12.8

+17%

+17%

Revenue (IFRS)

118.3

102.7

+15%

EMEA

63.2

56.4

+12%

AMERICAS

40.1

33.2

+20%

APAC

15.0

13.1

+15%

1) Growth at constant currency

 

Q1 2021 revenue increased by 15% year-on-year to EUR 118.3m (Q1 2020: EUR 102.7m), reflecting the discontinuation of the former perpetual license model. This effect will phase out during 2021 closing the growth differential to billings from 2022 onwards. A significant amount of Q1 billings have been booked towards the end of the quarter and will therefore be recognised as revenue later in the year contributing to TeamViewer’s full year 2021 revenue in the following quarters.

While continuing to invest across the sales, marketing and R&D organisations, adjusted EBITDA grew 22% year-over-year to EUR 90.0m. With 61.4%, the adjusted EBITDA margin remained virtually unchanged compared to Q1 2020. This high operating profitability continues to translate into very strong cash conversion. Levered Free Cash Flow amounted to EUR 25.0m (Q1 2020: EUR 35.2m) which already included prepayments related to the landmark sports partnerships. The company benefited from significantly lower interest paid for borrowings and lease liabilities of EUR 4.0m (Q1 2020: EUR 13.4m) as a result of fast deleveraging and the debt optimisation program which commenced last year. In Q1 2021 TeamViewer continued its financing activities with a EUR 300m promissory loan note linked to the ESG management score compiled by Sustainalytics and has thereby started to embed sustainability in its capital structure, too. In addition, a further reduction of funding costs and extension of maturities was achieved with a EUR 100m bilateral loan. The net proceeds were used to repay the drawn portion of the revolving credit facility RCF (EUR 52.7m) and will provide ample financial flexibility to execute on the company’s comprehensive growth initiatives. At the end of the first quarter, net leverage ratio stood at 1.6x with cash and cash equivalents of EUR 437.3m, providing TeamViewer with a strong liquidity position.

 

Additional information

This Quarterly Statement and all information therein is unaudited.

Webcast

Senior management will host an analyst and investor conference call at 9:00 CEST on 4 May 2021 to discuss the results. It will be webcast live at www.webcast-eqs.com/teamviewer20210504. A replay will be available on the Investor Relations website under ir.teamviewer.com. The accompanying presentation can also be downloaded there.

###
 

About TeamViewer

TeamViewer is a leading global technology company that provides a connectivity platform to remotely access, control, manage, monitor, and repair devices of any kind – from laptops and mobile phones to industrial machines and robots. Although TeamViewer is free of charge for private use, it has more than 600,000 subscribers and enables companies of all sizes and from all industries to digitalize their business-critical processes through seamless connectivity. Against the backdrop of global megatrends like device proliferation, automation and new work, TeamViewer proactively shapes digital transformation and continuously innovates in the fields of Augmented Reality, Internet of Things or Artificial Intelligence. Since the company’s foundation in 2005, TeamViewer’s software has been installed on more than 2.5 billion devices around the world. The company is headquartered in Goppingen, Germany, and employs more than 1,300 people globally. In 2020, TeamViewer achieved billings of EUR 460m. TeamViewer AG (TMV) is listed at Frankfurt Stock Exchange and belongs to the MDAX. Further information can be found at www.teamviewer.com.

Contact

Press Contact TeamViewer
Martina Dier

Director, Communications
Phone: +49 (0)7161 97200 10
E-Mail: [email protected]

Investor Relations TeamViewer
Carsten Keller

Head of Investor Relations and Capital Markets
Phone: +49 (0)151 1941 7780
E-Mail: [email protected]

 

Financial Calendar

Annual General Meeting

15 June 2021

Q2 2021 Results / Half-Year Report 2021

3 August 2021

Q3 2021 Results

9 November 2021

 

 

IMPORTANT NOTICE

Certain statements in this communication may constitute forward looking statements. These statements are based on assumptions that are believed to be reasonable at the time they are made, and are subject to significant risks and uncertainties, including, but not limited to, those risks and uncertainties described in TeamViewer’s disclosures. You should not rely on these forward-looking statements as predictions of future events and we undertake no obligation to update or revise these statements. Our actual results may differ materially and adversely from any forward-looking statements discussed in these statements due to several factors, including without limitation, risks from macroeconomic developments, external fraud, lack of innovation capabilities, inadequate data security and changes in competition levels. All stated figures are unaudited.

Alternative performance measures (APMs)

This document contains certain alternative performance measures (collectively, “APMs”) including billings and Adjusted EBITDA that are not required by, or presented in accordance with, IFRS, German GAAP or any other generally accepted accounting principles. TeamViewer presents APMs because they are used by management in monitoring, evaluating and managing its business and management believes these measures provide an enhanced understanding of TeamViewer’s underlying results and related trends. The definitions of the APMs may not be comparable to other similarly titled measures of other companies and have limitations as analytical tools and should, therefore, not be considered in isolation or as a substitute for analysis of TeamViewer’s operating results as reported under IFRS or German GAAP. APMs such as billings and Adjusted EBITDA are not measurements of TeamViewer’s performance or liquidity under IFRS or German GAAP and should not be considered as alternatives to results for the period or any other performance measures derived in accordance with IFRS, German GAAP or any other generally accepted accounting principles or as alternatives to cash flow from operating, investing or financing activities.

TeamViewer has defined each of the following APMs as follows:

“Billings” represent the (net) value of goods and services invoiced to customers in a given period if realization is probable – it is defined as revenue adjusted for change in deferred revenue P&L-effective;

“Adjusted EBITDA” means EBITDA, adjusted for P&L-effective changes in deferred revenue as well as for certain special items relating to share-based compensations and other material items that are not reflective of the operating performance of the business.

“Adjusted EBITDA margin” means adjusted EBITDA as a percentage of billings.

 

Operational metrics and other financial measures for information purposes

This document also includes further certain operational metrics, such as Net Retention Rate, and additional financial measures that are not required by, or presented in accordance with IFRS, German GAAP or any other generally accepted accounting principles (collectively, “other financial measures”). TeamViewer presents these operational metrics and other financial measures for information purposes and because they are used by the management for monitoring, evaluating and managing its business. The definitions of these operational metrics and other financial metrics may not be comparable to other similarly titled measures of other companies and have limitations as analytical tools and should, therefore, not be considered in isolation or as a substitute for analysis of TeamViewer’s operating results, performance or liquidity as reported under IFRS or German GAAP.

TeamViewer has defined these operational metrics and other financial measures for information purposes as follows:

“Levered free cash flow” (FCFE) means net cash from operating activities less capital expenditure for property, plant and equipment and intangible assets (excl. M&A), payments for the capital element of lease liabilities and interest paid for borrowings and lease liabilities; and

“Net leverage” means the ratio of net financial debt (sum of interest-bearing loans and borrowings, current and non-current, less cash and cash equivalents) to Adjusted EBITDA.

“Net retention rate (NRR)” means annual recurring billings (renewals, up- & cross sell) attributable to retained subscribers (subscribers which had been subscribers in the previous 12-month period) of the last 12-month period divided by all annual recurring billings of the previous 12-month period.

TeamViewer amended the NRR definition with the beginning of FY 2021 to facilitate a direct derivation from reported annual recuring billings. If calculated according to this new definition, the NRRs for FY 2020 and FY 2019 would be 104% and 105% compared to previously disclosed NRRs of 103% and 102% for FY 2020 and FY 2019, respectively.

The use by TeamViewer of any MSCI ESG research llc or its affiliates (“MSCI”) data, and the use of MSCI logos, trademarks, service marks or index names herein, do not constitute a sponsorship, endorsement, recommendation, or promotion of TeamViewer by MSCI. MSCI services and data are the property of MSCI or its information providers and are provided “as-is” and without warranty. MSCI names and logos are trademarks or service marks of MSCI. In 2020, TeamViewer received a rating of “AA” (on a scale of AAA-CCC) in the MSCI ESG ratings assessment.

Copyright(c) 2020 Systainalytics. All rights reserved. This publications contains information developed by Systainalytics (www.systainalytics.com). Such information and data are proprietary of Systainalytics and/or its third-party suppliers (Third Party Data) and are provided for informational purposes only. They do not constitute an endorsement of any product or project, nor investment advice and are not warranted to be complete, timely, accurate or suitable for a particular purpose. Their use is subject to conditions available at https://www.systainalytics.com/legal-disclaimers. In December 2020, TeamViewer received an ESG Risk Rating of 15.6 and was assessed by Systainalytics to be at “Low Risk” of experiencing material financial impacts from ESG factors.

ISS ESG: In February 2020, TeamViewer has been awarded “Prime” status with the ISS ESG Corporate Rating.

In April 2020 TeamViewer has received an ESG rating score from Vigeo Eiris.

 

Consolidated Profit & Loss Statement

€ thousand

 

Q1 2021

Q1 2020

Revenue

 

118,330

102,717

Cost of sales

 

(18,380)

(14,067)

Gross profit

 

99,950

88,650

Sales

 

(24,625)

(15,705)

Marketing

 

(12,994)

(8,691)

Research and development

 

(13,814)

(9,473)

General and administrative

 

(13,676)

(12,829)

Bad debt expenses

 

(4,495)

(5,157)

Other income

 

1,494

453

Other expenses

 

(3,078)

(137)

Operating profit

 

28,761

37,111

Finance income

 

403

40

Finance cost

 

(5,248)

(8,130)

Foreign exchange income

 

4,738

5,697

Foreign exchange costs

 

(18,718)

(13,253)

Profit before taxation

 

9,936

21,465

Income taxes

 

(6,690)

(9,339)

Profit/(loss) for the period

 

3,246

12,126

 

 

 

 

Basic number of shares issued and outstanding

 

200,000,000

200,000,000

Earnings per share (in € per share)

 

0.02

0.06

Diluted number of shares issued and outstanding

 

200,380,918

200,000,000

Diluted earnings per share (in € per share)

 

0.02

0.06

 

 

Consolidated Balance Sheet

€ thousand

 

 

31 March 2021

31 December 2020

Non-current assets

 

 

 

 

Goodwill

 

 

665,076

646,793

Intangible assets

 

 

268,074

255,330

Property, plant and equipment

 

 

43,329

40,469

Financial assets

 

 

4,516

4,516

Other assets

 

 

966

857

Deferred tax assets

 

 

159

159

Total non-current assets

 

 

982,119

948,124

Current assets

 

 

 

 

Trade receivables

 

 

18,055

19,667

Other assets

 

 

33,107

7,594

Tax assets

 

 

52

52

Financial assets

 

 

1,443

4,456

Cash and cash equivalents

 

 

437,330

83,531

Total current assets

 

 

489,987

115,301

Total assets

 

 

1,472,106

1,063,425

 

 

Consolidated Balance Sheet (continued)

€ thousand

 

 

31 March 2021

31 December 2020

Equity

 

 

 

 

Issued capital

 

 

201,071

201,071

Capital reserve

 

 

381,012

366,898

(Accumulated losses)/retained earnings

 

 

(323,608)

(326,854)

Hedge reserve

 

 

(48)

(61)

Foreign currency translation reserve

 

 

320

(343)

Total equity attributable to owners of the parent

 

 

258,748

240,711

Non-current liabilities

 

 

 

 

Provisions

 

 

400

433

Financial liabilities

 

 

857,317

440,153

Deferred revenue

 

 

267

361

Deferred and other liabilities

 

 

2,576

1,614

Other financial liabilities

 

 

13,354

0

Deferred tax liabilities

 

 

27,926

29,186

Total non-current liabilities

 

 

901,839

471,747

Current liabilities

 

 

 

 

Provisions

 

 

3,475

2,225

Financial liabilities

 

 

31,755

82,099

Trade payables

 

 

7,889

8,304

Deferred revenue

 

 

227,968

214,811

Deferred and other liabilities

 

 

35,593

39,120

Other financial liabilities

 

 

2,891

29

Tax liabilities

 

 

1,948

4,378

Total current liabilities

 

 

311,519

350,966

Total liabilities

 

 

1,213,359

822,714

Total equity and liabilities

 

 

1,472,106

1,063,425

 

Consolidated Cash Flow Statement

€ thousand

 

Q1 2021

Q1 2020

Cash flows from operating activities

 

 

 

Profit before taxation

 

9,936

21,465

Depreciation, amortisation and impairment of non-current assets

 

11,937

9,613

(Gain)/loss from the sale of property, plant and equipment

 

(0)

3

Increase/(decrease) in provisions

 

1,217

(978)

Non-operational foreign exchange (gains)/
losses

 

15,306

6,689

Expenses for share-based compensation – equity settled

 

14,115

10,133

Net financial costs

 

4,845

8,091

Change in deferred revenue

 

13,062

4,123

Changes in other net working capital and other

 

(23,851)

3,682

Income tax paid

 

(12,586)

(8,104)

Net cash from operating activities

 

33,981

54,717

Cash flows from investing activities

 

 

 

Capital expenditure for property, plant and equipment and intangible assets

 

(3,859)

(5,155)

Proceeds from the sale of property, plant and equipment

 

(0)

0

Payments for the acquisition of non-current financial assets

 

0

(51)

Acquisition of subsidiaries

 

(19,097)

0

Net cash used in investing activities

 

(22,956)

(5,205)

 

 

Consolidated Cash Flow Statement (continued)

€ thousand

 

Q1 2021

Q1 2020

Cash flows from financing activities

 

 

 

Repayments of borrowings

 

(52,730)

0

Proceeds from bank borrowings

 

400,000

0

Payments for the capital element of lease
liabilities

 

(1,107)

(967)

Interest paid for borrowings and lease
liabilities

 

(3,975)

(13,349)

Net cash used in financing activities

 

342,188

(14,316)

 

 

 

 

Net change in cash and cash equivalents

 

353,213

35,195

Net foreign exchange rate difference

 

1,516

453

Net change from cash risk provisioning

 

(930)

(972)

Cash and cash equivalents at beginning of period

 

83,531

71,153

Cash and cash equivalents at end of period

 

437,330

105,829

 

04.05.2021 Dissemination of a Corporate News, transmitted by DGAP – a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases.
Archive at www.dgap.de

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