Earnings release
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PRESS RELEASE FOR IMMEDIATE RELEASE April 22, 2025 Ad hoc announcement pursuant to Art. 53 LR Temenos announces Q1-25 results; solid growth in ARR, EBIT and FCF Reconfirming FY-25 guidance and providing Q2-25 growth outlook Q1-25 summary (proforma, excluding Multifonds) • Q1-25 ARR of USD 741m up 9% y-o-y c.c. • Strong high-teens growth in software licensing largely compensated for anticipated downsell from large SaaS Buy Now Pay Later (BNPL) customer • Q1-25 non-IFRS subscription and SaaS down -2% c.c.; some push out around deal signings at quarter -end given increased macroeconomic uncertainty • Q1-25 non-IFRS maintenance up 11% c.c. • Q1-25 non-IFRS EBIT up 8% c.c. with 1% point of margin expansion • Q1-25 non-IFRS EPS up 17% • Q1-25 free cash flow of USD 49m, up 12% • Good start to Q2-25 with a number of deals already signed • Q2-25 indicative growth rates for non -IFRS subscription and SaaS growth of 6-10% and ARR growth of at least 10% excluding Multifonds • FY-25 guidance reconfirmed (non-IFRS, constant currency , excluding Multifonds ), while recognizing increased macroeconomic uncertainty; ARR growth of at least 12%, Subscription and SaaS growth of 5-7%, EBIT growth of at least 5%, EPS growth of 7-9% reported and free cash flow growth of at least 12% reported • FY-28 targets reconfirmed (non -IFRS, constant currency, excluding Multifonds) with ARR to reach more than USD 1.2bn, EBIT to reach c.USD 450m and Free Cash Flow to reach c.USD 400m • Share buyback of up to CHF 250m announced today , to commence on April 28, 2025 and close by December 30, 2025 at the latest; shares to be proposed for cancellation at the 2026 AGM GRAND-LANCY, Switzerland, April 22, 2025 – Temenos AG (SIX: TEMN), a global leader in banking technology, today announces its first quarter 2025 results. Annual Recurring Revenue (ARR) Reported income statement The definition of non-IFRS adjustments is provided below. * Constant currency (c.c.) adjusts prior year for movements in currencies USDm, except EPS Q1-25 Q1-24 Change CC* Q1-25 Q1-24 Change CC* Annual Recurring Revenue 797.0 723.1 10% 10% 741.4 683.5 8% 9% Reported Proforma (excluding Multifonds) USDm, except EPS Q1-25 Q1-24 Change CC* Q1-25 Q1-24 Change CC* Subscription and SaaS 80.2 84.0 (5%) (3%) 80.2 84.0 (5%) (3%) Maintenance 120.9 112.7 7% 8% 120.9 112.7 7% 8% Services 31.2 33.1 (6%) (5%) 31.2 33.1 (6%) (5%) Total revenues 232.2 229.9 1% 2% 232.2 229.9 1% 2% EBIT 75.8 72.9 4% 3% 40.1 46.4 (14%) (15%) EBIT margin 32.6% 31.7% 1% pts 0% pts 17.3% 20.2% -3% pts -3% pts EPS (USD) 0.81 0.73 11% 0.40 0.44 (9%) Non-IFRS IFRS Reported
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PRESS RELEASE FOR IMMEDIATE RELEASE April 22, 2025 Proforma income statement and free cash flow excluding Multifonds Q1-25 business update • Sales environment remained stable until last two weeks of the quarter, which saw some push outs of deal signings; deals are expected to be signed in Q2-25 • Solid growth in ARR and maintenance providing visibility on future revenue and free cash flow • Strong high-teens growth in software licensing largely compensated for anticipated downsell from large SaaS BNPL customer • Continued execution of targeted investments across the business • Strong growth in profitability driven by excellent cost control and progress on cost savings initiatives • Continued execution of US strategy with opening of sizeable innovation hub in Florida • Simplification of product and technology organization and portfolio also progressing well, in line with strategic plan • Strength of balance sheet and free cash flow generation supports share buyback of up to CHF 250m (press release available here); shares to be proposed for cancellation at the 2026 AGM Q1-25 financial summary (non-IFRS, proforma excluding Multifonds except leverage) • ARR of USD 741.4m, up 9% c.c. • Non-IFRS subscription and SaaS of USD 76.8m. down 2% c.c. • Non IFRS maintenance revenue of USD 113.5m, up 11% c.c. • Non-IFRS total revenue of USD 220.3m, up 4% c.c. • Non-IFRS EBIT of USD 69.5m, up 8% c.c. • Q1-25 non-IFRS EBIT margin of 31.5%, up 1% pt c.c. • Non-IFRS EPS of USD 0.75, up 17% reported • Q1-25 free cash flow of USD 48.8m, up 12% y-o-y • Leverage at 1.3x at end of Q1-25 Commenting on the results, Temenos CEO Jean-Pierre Brulard said: ”In the first quarter, our good underlying performance was affected by the anticipated downsell from a large SaaS BNPL client and some push out of deal signings toward the end of the quarter , given increased macroeconomic uncertainty . We delivered high teens growth in software licensing driven mainly by subscription licenses and we are confident the delayed deals will be signed in Q2. We won a number of new SaaS core banking logos in Western Europe and North America in the quarter, demonstrating the strengt h of our SaaS and cloud capabilities and competitive positioning in the market. We also had a significant number of go-lives in the quarter as we continue to invest in customer lifecycle. We continue to make excellent progress on our strategic roadmap, with the opening of our innovation hub in Florida to serve our US requirements as well as the global market. We have also pressed ahead at speed with the simplification of our global USDm, except EPS Q1-25 Q1-24 Change CC* Subscription and SaaS 76.8 79.7 (4%) (2%) Maintenance 113.5 102.8 10% 11% Services 30.0 31.5 (5%) (4%) Total revenues 220.3 214.1 3% 4% EBIT 69.5 63.9 9% 8% EBIT margin 31.5% 29.9% 2% pts 1% pts EPS (USD) 0.75 0.64 17% Free cash flow 48.8 43.5 12% Proforma (excluding Multifonds) Non-IFRS
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PRESS RELEASE FOR IMMEDIATE RELEASE April 22, 2025 product and technology organization and our product portfolio to align with our strategic priorities. Furthermore, we are confident the business will continue to perform well in the current environment . Digital transformation is not discretionary and banks have a mandate to renovate their IT real estate to lower TCO and to enable their businesses to scale efficiently.” Commenting on the proforma results (excluding Multifonds), Temenos CFO Takis Spiliopoulos said: “We had solid growth in ARR in the quarter, up 9% in constant currency , driven by growth in subscription licenses and our maintenance revenue which again grew double-digit, benefiting from a good level of premium maintenance signings. With the push out of a number of deals into the second quarter, the high teens growth in software licensing was not sufficient to offset the anticipated decline in SaaS revenue. We maintained excellent control of our cost base in the quarter which was marginally up year-on-year in constant currency, benefiting from our sustained progress and solid execution on cost savings initiatives . Non-IFRS EBIT grew 8% in the quarter whilst we continued to execute on our targeted investments as planned. We generated USD 48.8m of free cash flow, increasing 12% year-on-year, and ended the quarter with leverage at 1.3x net debt to non-IFRS EBITDA, including the Multifonds balance sheet impact, which is well within our target operating leverage of 1.0 to 1.5x. As a reminder, the sale of Multifonds is expected to close in the second quarter. We have exceptionally given indicative growth rates for Q2-25, given the current market volatility, with non-IFRS subscription and SaaS expected to grow 6-10% and ARR to grow at least 10%. We have reconfirmed o ur guidance for FY -25, while recognizing the increased levels of macroeconomic uncertainty. Lastly, given the strength of our balance sheet and free cash flow, we have announced a share buyback of up to CHF 250m which will commence on April 28, 2025. The shares will be proposed for cancellation at the 2026 AGM” Revenue Reported IFRS and non-IFRS revenue was USD 232.2m for the quarter, an increase of 1% vs. Q1-24 Proforma non-IFRS revenue (excluding Multifonds) was USD 220.3m for the quarter, an increase of 3% vs. Q1-24 Reported IFRS and non-IFRS subscription and SaaS revenue for the quarter was USD 80.2m, a decrease of 5% vs. Q1-24. Proforma non-IFRS subscription and SaaS revenue (excluding Multifonds) for the quarter was USD 76.8m, a decrease of 4% vs. Q1-24. EBIT Reported IFRS EBIT was USD 40.1m for the quarter, a decrease of 14% vs. Q1-24. Reported non-IFRS EBIT was USD 75.8m for the quarter, an increase of 4% vs. Q1-24. Proforma non-IFRS EBIT (excluding Multifonds) was USD 69.5m for the quarter, an increase of 9% vs. Q1 -24. Earnings per share (EPS) Reported IFRS EPS was USD 0.40 for the quarter, a decrease of 9% vs. Q1-24. Reported non-IFRS EPS was USD 0.81 for the quarter, an increase of 11%. Proforma non-IFRS EPS (excluding Multifonds) was USD 0.75 for the quarter, an increase of 17% vs. Q1-24. Cash flow USD 48.8m of free cash flow (excluding Multifonds) was generated in the quarter, an increase of 12% vs. Q1-24. Revenue line items and new cloud ARR disclosure Temenos introduced new annual disclosure o f cloud ARR at the time of its Q4 -24 results announcement in February 2025, to provide transparency on the growth in cloud adoption. I ts revenue disclosure was also updated to reflect changes in customer demand and industry best practice, with increasing use of hybrid and public cloud . ‘Total software licensing’ was renamed as ‘subscription and SaaS’ to bring disclosure in line with leading global software players. ‘Subscription and SaaS’ comprise s
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PRESS RELEASE FOR IMMEDIATE RELEASE April 22, 2025 subscription, term license and SaaS revenue. Term license is expected to continue declining to around USD 20-30m p.a. steady state. FY-25 non-IFRS guidance reiterated The guidance for F Y-25 is non -IFRS an d in constant currencies , except for EPS and FCF which are reported . The guidance excludes any contribution from Multifonds. Free cash includes IFRS 16 leases and interest costs. FY-25 guidance reiterated • ARR growth of at least 12% • Subscription and SaaS growth of 5-7% • EBIT growth of at least 5% • EPS growth of 7-9% reported • FCF growth of at least 12% reported The Company has also assumed the following for FY-25 guidance: • FY-25 tax rate expected to be between 15 -17%, benefiting from one off tax impact of c.USD 15m from prior years ; normalized tax rate of 19-21% Currency assumptions for FY-25 guidance In preparing the FY-25 guidance, the Company has assumed the following: • EUR to USD exchange rate of 1.09; • GBP to USD exchange rate of 1.30; and • USD to CHF exchange rate of 0.86 FY-28 targets FY-28 targets exclude contribution from Multifonds. Free cash flow includes IFRS 16 leases and interest costs. • ARR of at least USD 1.2bn • EBIT of c. USD 450m • FCF of c. USD 400m The guidance provided above and other statements about Temenos' expectations, plans and prospects in this press release constitute forward-looking financial information and represent the Company’s current view and estimates as of April 22, 2025. We anticipate that subsequent events and developments may cause the Company’s guidance and estimates to change. Future events are inherently difficult to predict. Accordingly, actual results may differ materially from those indicated by these forward -looking statements as a result of a variety of factors. More information about factors that potentially could affect the Company’s financial results is included in its annual report available on the Company’s website.
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PRESS RELEASE FOR IMMEDIATE RELEASE April 22, 2025 Conference call and webcast At 18.30 CET / 17.30 GMT / 12.30 EST today, April 22, 2025, Jean-Pierre Brulard, CEO, and Takis Spiliopoulos, CFO, will host a webcast to present the results and offer an update on the business outlook. The webcast can be accessed through the following link: Q1 2025 webcast link Please use the webcast in the first instance to avoid delays in joining the call. For those who cannot access the webcast, the following dial-in details can be used as an alternative. Please dial in 15 minutes before the call commences. Switzerland / Europe: + 41 (0) 58 310 50 00 United Kingdom: + 44 (0) 207 107 06 13 United States: + 1 (1) 631 570 56 13 Non-IFRS financial Information Readers are cautioned that the supplemental non -IFRS information presented in this press release is subject to inherent limitations. It is not based on any comprehensive set of accounting rules or principles and should not be considered as a substitute for IFRS measurements. Also, the Company’s supplemental non -IFRS financial information may not be comparable to similarly titled non-IFRS measures used by other companies. The Company’s non-IFRS figures exclude share-based payments and related social charges costs, any deferred revenue write -down resulting from acquisitions, discontinued activities that do not qualify as such under IFRS, gain/loss from business disposals, acquisition/investment/carve out related charges such as financing costs, advisory fees and integration costs and fair value changes on investments, charges as a result of the amortization of acquired intangibles, costs incurred in connection with a restructuring program or other organizational transformation activities planned and controlled by management, and adjustments made to reflect the associated tax charge relating to the above items. Below are the accounting elements not included in the FY-25 non-IFRS guidance. • FY-25 estimated share-based payments and related social charges of c.5% of revenue • FY-25 estimated amortisation of acquired intangibles of USD 45m • FY-25 estimated restructuring/M&A related costs of USD 35m – Ends – About Temenos Temenos (SIX: TEMN) is a global leader in banking technology. Through our market-leading core banking suite and best-in-class modular solutions, we are modernizing the banking industry. Banks of all sizes utilize our adaptable technology – deployed on- premises, in the cloud, or as SaaS – to deliver next-generation services and AI -enhanced experiences that elevate banking for their customers. Our mission is to create a world where people can live their best financial lives. For more information, please visit www.temenos.com. Investor and media contacts Investors Adam Snyder Head of Investor Relations, Temenos Email: asnyder@temenos.com Tel: +44 207 423 3945 International media Conor McClafferty FGS Global on behalf of Temenos Email: Conor.McClafferty@fgsglobal.com Tel: +44 7920 087 914 Swiss media Martin Meier-Pfister IRF on behalf of Temenos Email: meier-pfister@irf-reputation.ch Tel: +41 43 244 81 40
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PRESS RELEASE FOR IMMEDIATE RELEASE April 22, 2025 Appendix I – Q1-25 IFRS primary statements TEMENOS AG All amounts are expressed in thousands of US dollars except earnings per share Three months to Three months to Twelve months to Twelve months to 31 March 2025 31 March 2024 31 March 2025 31 March 2024 Revenues Subscription and SaaS 80,152 84,043 446,619 436,351 Maintenance 120,890 112,716 472,454 434,020 Services 31,154 33,121 127,348 133,185 Total revenues 232,196 229,880 1,046,421 1,003,556 Operating expenses Sales and marketing (69,579) (65,623) (295,211) (296,638) Services (32,132) (31,235) (128,030) (134,365) Software development and maintenance (65,591) (63,880) (288,149) (276,892) General and administrative (24,808) (22,771) (110,102) (93,109) Total operating expenses (192,110) (183,509) (821,492) (801,004) Operating profit 40,086 46,371 224,929 202,552 Other expenses Net interest expenses (1,615) (3,233) (13,308) (19,823) Borrowing facility expenses (136) (142) (783) (590) Foreign exchange loss and movement in fair value from financial instruments (829) (1,930) (4,791) (6,418) Total other expenses (2,580) (5,305) (18,882) (26,831) Profit before taxation 37,506 41,066 206,047 175,721 Taxation (8,480) (8,801) (32,107) (39,357) Profit for the period 29,026 32,265 173,940 136,364 Earnings per share (in US$): basic 0.41 0.44 2.43 1.89 diluted 0.40 0.44 2.41 1.88
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PRESS RELEASE FOR IMMEDIATE RELEASE April 22, 2025 TEMENOS AG All amounts are expressed in thousands of US dollars 31 March 31 December 31 March 2025 2024 2024 Assets Current assets Cash and cash equivalents 134,556 114,154 302,456 Trade receivables 165,979 179,918 203,700 Other receivables and financial assets 111,741 107,709 121,033 412,276 401,781 627,189 Assets classified as held for sale 243,417 235,269 - Total current assets 655,693 637,050 627,189 Non-current assets Property, plant and equipment 48,027 50,841 56,936 Intangible assets 1,283,212 1,280,873 1,502,815 Trade receivables 223,679 206,435 169,438 Other long term assets 49,192 47,598 40,630 Deferred tax assets 58,394 53,891 62,730 Total non-current assets 1,662,504 1,639,638 1,832,549 Total assets 2,318,197 2,276,688 2,459,738 Liabilities and equity Current liabilities Trade and other payables 223,853 218,316 190,248 Deferred revenues 438,065 437,931 433,023 Income tax liabilities 118,366 115,645 85,279 Borrowings 265,011 257,157 185,605 1,045,295 1,029,049 894,155 Liabilities relating to assets classified as held for sale 42,849 44,390 - Total current liabilities 1,088,144 1,073,439 894,155 Non-current liabilities Borrowings 451,965 469,566 685,297 Deferred tax liabilities 55,703 55,876 101,836 Trade and other payables 3,518 1,722 2,450 Deferred revenues 16,361 18,956 23,701 Retirement benefit obligations 19,048 18,155 18,048 Total non-current liabilities 546,595 564,275 831,332 Total liabilities 1,634,739 1,637,714 1,725,487 Shareholders’ equity Share capital 254,764 254,764 254,764 Treasury shares (352,957) (403,945) (376,761) Share premium and capital reserves (287,522) (250,427) (159,131) Fair value and other reserves (217,837) (219,402) (196,691) Retained earnings 1,287,010 1,257,984 1,212,070 Total shareholders’ equity 683,458 638,974 734,251 Total equity 683,458 638,974 734,251 Total liabilities and equity 2,318,197 2,276,688 2,459,738
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PRESS RELEASE FOR IMMEDIATE RELEASE April 22, 2025 TEMENOS AG All amounts are expressed in thousands of US dollars Three months to Three months to Twelve months to Twelve months to 31 March 2025 31 March 2024 31 March 2025 31 March 2024 Cash flows from operating activities Profit before taxation 37,506 41,066 206,047 175,721 Adjustments: Depreciation and amortization 29,259 32,400 127,227 131,029 Other non-cash and non-operating items 17,869 13,917 79,380 85,152 Changes in working capital: Trade and other receivables (8,736) 11,157 (89,669) (52,429) Trade and other payables, and retirement benefit obligations 9,877 (6,351) 48,776 (8,684) Deferred revenues (6,921) (20,634) 26,874 61,798 Cash generated from operations 78,854 71,555 398,635 392,587 Income taxes paid (4,188) (1,878) (30,295) (52,972) Net cash generated from operating activities 74,666 69,677 368,340 339,615 Cash flows from investing activities Purchase of property, plant and equipment (1,473) (1,089) (5,410) (8,525) Disposal of property, plant and equipment - - 163 165 Purchase of intangible assets (640) (470) (3,303) (2,267) Capitalized development costs (17,857) (19,346) (68,833) (76,277) Repayment for long-term loans - - - 3,000 Settlement of financial instruments (3,333) 3,564 (1,826) 3,124 Interest received 354 799 1,624 2,445 Net cash used in investing activities (22,949) (16,542) (77,585) (78,335) Cash flows from financing activities Dividend paid - - (96,938) (88,273) Disposal of treasury shares - - 67,447 34,713 Acquisition of treasury shares - - (226,783) - Proceeds from borrowings 21,971 169,767 339,899 316,854 Repayments of borrowings (49,436) (15,002) (339,461) (316,888) Proceeds from issuance of bonds - - - 220,840 Repayment of bond - - (166,181) (200,192) Proceeds from long-term loans - - 467 - Payment of lease liabilities (3,178) (3,721) (14,533) (15,099) Interest paid (1,295) (336) (26,303) (21,208) Settlement of financial instruments - (1,541) 5,507 1,777 Payment of other financing costs (574) (1,101) (2,945) (3,682) Net cash used in financing activities (32,512) 148,066 (459,824) (71,158) Effect of exchange rate changes 1,197 (5,630) 1,169 265 Net increase / (decrease) in cash and cash equivalents in the period 20,402 195,571 (167,900) 190,387 Cash and cash equivalents at the beginning of the period 114,154 106,885 302,456 112,069 Cash and cash equivalents at the end of the period 134,556 302,456 134,556 302,456
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PRESS RELEASE FOR IMMEDIATE RELEASE April 22, 2025 Appendix II – reconciliation of IFRS to non-IFRS Q1-25 Income Statement Readers are cautioned that the supplemental non-IFRS information presented in this press release is subject to inherent limitations. It is not based on any comprehensive set of accounting rules or principles and should not be considered as a substitute for IFRS measurements. Also, the Company’s supplemental non -IFRS financial information may not be comparable to similarly titled non-IFRS measures used by other companies. To compensate for these limitations, the supplemental non -IFRS financial information should not be read in isolation, but only in conjunction with the Company’s consolidated financial statements prepared in accordance with IFRS. IFRS - Non- IFRS Reconciliation Thousands of US Dollars 2025 2025 2024 2024 IFRS Non-IFRS IFRS Non-IFRS adjustments Non-IFRS IFRS Non-IFRS adjustments Non-IFRS Subscription and SaaS 80,152 - 80,152 84,043 - 84,043 (5%) (5%) Maintenance 120,890 120,890 112,716 112,716 7% 7% Services 31,154 31,154 33,121 33,121 (6%) (6%) Total Revenue 232,196 - 232,196 229,880 - 229,880 1% 1% Total Operating Expenses (192,110) 35,711 (156,399) (183,509) 26,567 (156,942) 5% (0%) Restructuring (9,489) 9,489 - (5,300) 5,300 - 79% Amort of Acquired Intangibles (10,651) 10,651 - (10,846) 10,846 - (2%) Share based payment (15,571) 15,571 - (10,421) 10,421 - 49% Operating Profit 40,086 35,711 75,797 46,371 26,567 72,938 (14%) 4% Operating Margin 17% 33% 20% 32% -2.9% pts 0.9% pts Finance Costs (2,580) - (2,580) (5,305) - (5,305) (51%) (51%) Taxation (8,480) (6,365) (14,845) (8,801) (5,080) (13,881) (4%) 7% Net Earnings 29,026 29,346 58,372 32,265 21,487 53,752 (10%) 9% EPS (USD per Share) 0.40 0.41 0.81 0.44 0.29 0.73 (9%) 11% 3 Months Ending 31 March Change