François Bordonado - Investor Relations Bernard Charlès – Chief Executive Officer Thibault de Tersant – Chief Financial Officer

John King -- Barclays Josep Bori – BNP Paribas Jay Vleeschhouwer – Griffin Securities Michael Briest – UBS

Thank you for standing by, and welcome to the Dassault Systèmes 2012 Fourth Quarter and Full-Year Financial Results Call. At this time, all participants are in a listen-only mode. A short overview will be given, followed by a question-and-answer session. (Operator Instructions) I must advise you that this conference is being recorded today. I would now like to hand the conference over to François Bordonado, Investor Relations. Please go ahead. François Bordonado: Thank you, Sal. Thank you for joining Bernard Charlès, CEO; and Thibault de Tersant, CFO, on this conference call to discuss our fourth quarter and full-year 2012. In addition, earlier today, we held our vested presentation in Paris, which is also available in our website. Two brief reminders. First, Dassault Systèmes’ financial results are prepared in accordance with IFRS. We have provided supplemental non-IFRS financial information which is explained in the IFRS and non-IFRS reconciliation tables included in our earnings press release. And second, some of the comments we’ll make on this call will contain forward-looking statements which could differ materially from actual results. Please refer to our risk factors in today’s press release and in our 2011 Document de référence and 2012 financial report. Let me now turn the call over to Bernard Charlès. Bernard Charlès: Thank you, François-José. Thank you for joining us today and for your interest in Dassault Systèmes. 2012 was truly a unique year. With the unveiling of the new Dassault Systèmes, the 3DEXPERIENCE company, the launching of our Social Industry Experience strategy and the introduction of our first 12 industry solution experiences. It was a year of unprecedented transformation within Dassault Systèmes with 3DEXPERIENCE driving our strategy, our product road map on organizational and operational structure. And it was a year of record financial figures for the earnings operating profitability and cash flow. Looking at our financial and business results during 2012, I believe they position us well for our future expansion. Growth, we delivered 10% revenue growth in constant currency, with a pretty good dynamic all along the year in our largest industry, and excellent progress in target verticals. As expected, we crossed a new milestone, €2 billion in revenues, doubling our revenues in six years. Earnings per share increased 15% to €3.37, thanks to those increasing revenue and operating profitability. Our operating margin expanded 120 basis points to 31.6%, benefiting from revenue growth on the operational improvements. We continue to apply best practices everywhere in the company. As we grow our revenue base and reach key milestones, the improvements we are making throughout the company will be important levers. I’d like to insist on one point. We continue to make important investments in our business, growing our industry capacities, the sales platform, sales channels are also critical resources during 2012 in order to support the expansion of our addressable market to $32 billion. Expansion on diversification of our business progressed very well during 2012, too. We are enhancing our future opportunity with 20,000 new customers, thanks to our indirect channels’ capacity growth. We are also increasing our touch points with 10 million users among business, educational on consumers interacting with both our software applications, thanks to our brands. Our market footprint in high-growth countries is growing with our revenue increasing 16% in constant currencies during 2012. And we continue to expand in our target vertical which contributed nearly one quarter of our revenue in 2012. At the same time, our reserves in our core industries demonstrated good growth so we are just diversified from strength. Our fast-growing portfolio of industry solution experiences will further our vertical diversification and accelerate rollouts for customers. One year ago, on February 9, 2012, we unveiled for Dassault Systèmes a new horizon with 3DEXPERIENCE. And it is about placing the end-consumer experience at the heart of the innovation process. Whatever product or service you are buying, your ultimate opinion of that product or service is the experience you have with it. 3DEXPERIENCE represents an addressable market which should approximately lead double that we have been serving to date. We believe this market enables us to expand the domains we address and the users we serve. And this strategy also reinforces the meaning of what we do in 3D and 3DPLM. In conjunction, we expanded our mission with the purpose to provide business on people with 3DEXPERIENCE universe to imagine sustainable innovation, capital of harmonizing product nature and life. Our observation is that our customers no longer want to simply bring features and functions’ improvements to their products. They want to place their customers at the heart of the innovation process and deliver to them delightful experiences which will truly make a difference. So, what does it mean and how did we start to transform our self to become the 3DEXPERIENCE company? First of all, it means that we begin with the industries themselves. What are their key value drivers? How might they evolve in the years ahead? How do we have industries and companies within those industries deliver on the most important business value driver of their own customers? Second, internally. Industry research and development and marketing are closely connected in terms of building value-driven industry solutions, leveraging our significant ground application portfolio and embedding what is most critical for each targeted industry. So, it means that we need to support the complete value chain to deliver 3D experiences. Fourth, to ensure this value chain integration, we need to add one single platform, the 3DEXPERIENCE business platform. This is the business platform for our customers architected to be on premise, online, in a public cloud or in a private cloud, designed in a form of a compass. It will become the user interface to access all our application set. Thanks to the Version 6 architecture, it will leverage the IP created for a given customer process, ensuring value chain consistency with all other processes it will support. And finally, as we outlined last February, we bring significant strategic assets on key differentiators already to help drive our strategy forward. So, I think you have an understanding of where we are going. So, the question becomes how are customers receiving it. Well, I think very well so far. The reception on the discussion has been very good in each of the 12 industries we target. We have some key customer wins to illustrate this later. During 2012, we introduced our first industry solution experiences. As we have discussed together, this offer helps company take full value from our brands in a very easy manner as we do all the work for them to bring together the appropriate applications on technology into a powerful solution but one that is easy to deploy and use, with visible reduction in implementation time and, therefore, bringing value faster. By doing so, we simplified deployments in turn as to achieve a better experience. Last quarter, I highlighted three of them, our Smart, Safe & Connected solutions for transportation and mobility, Perfect Shelf for consumer packaged goods on optimized plant construction for AEC. Let me share some more with you. Our winning program, 3DEXPERIENCE Solution, enables innovative aerospace and defense companies through integrated conceptual design to identify the milestone on challenges of a new program in order to ensure that all will be properly planned and will be delivered on time and will meet its commitments. This is, of course, very useful to win a new program. Our Perfect Package Industry Solutions helps consumer packaged goods companies who think package design for better, faster innovation, and to manage all the information among the various participants. It provides true concurrent package design by connecting the entire ecosystem of package design. Perfect Package combines apps from CATIA, ENOVIA, SIMULIA, NETVIBES and 3DSWYM. On the wind energy sector, we have introduced sustainable wind turbines. In order to improve competitiveness and development of the wind energy industry, companies need to improve wind turbine efficiency, quality, reliability in diverse operating conditions and also to lower manufacturing costs, operational costs and environmental footprint. Using our sustainable wind turbine solutions, customers can find efficient solutions to lower cost and pollution and have a complete solution from design to simulation and manufacturing including composite and, of course, credibility and cost of operations. Now let me introduce you to a recent acquisition. In December, we acquired SquareClock, an innovative start-up. Interestingly, it was formed by Dassault Systèmes employee who wanted to spin off to create the most entity on simple experience – I should say 3D experience to design a layout of it without any training. They have done a great job, needless to say, and are now pleased to join us to take their application to the international markets. SquareClock, which will naturally be placed inside the 3DVIA brand, provides cloud-based social 3D experience, product configuration and space-planning solution for retail professionals and residentials. Today, more markets are rising in our business than ever, thanks to the expansion on diversification during 2012, we continue to strengthen and extend relationship with customers in our core industries, reached more companies on users in other targeted industry, and broadened our industry coverage to natural resources. We are working with our largest clients within a global framework, leading to stronger expanded partnerships. We are enlarging our market footprint and opening new strategic relationships with companies in a number of industries and geographic markets to – the expansion of our customer base and customer relationships reflects our goal to provide solutions that deliver important values for our customers, helping drive innovation and helping drive the global efficiency, while at the same time, packaging manner offering a quick return on investment. More broadly, during 2012, Dassault Systèmes welcomed over 20,000 new customers. A large portion of this was driven by our indirect channels. First, we follow professional channel focused on the volume market and with our value solution channel, as we added more partners expanding our reach in two target industries. At the same time, our direct channel for large accounts add important multi-brand competitive win, thanks to the industry solution experience packaging. Pratt & Whitney Canada selection for process planning, requirement, management and quality is very significant to help increase the product value while decreasing its service cost. HAITEC in Taiwan focused on global efficiency from styling to engineering, on IP protection as its key challenges to be addressed with our software solutions. Nokia’s decision to sell its data system was based on its objectives to improve its collaboration both internally and externally while also enhancing the protection of its IP. Nokia will use our 3DEXPERIENCE platform for global collaboration across its design, production and supply chain with CATIA, ENOVIA and DELMIA and the V6 architecture. In addition, Nokia has adopted EXALEAD for intelligent – information intelligence. We are also increasing our touch points providing opportunities for us now on – into the future. We estimate that our software applications are reaching over 10 million users, business education – educational on customers – consumers rather. So, our phase channel, our commercial activity is well understood. Education is a very important area of focus. And here, as a company, we continue to grow the network presence at all levels of education. Under consumer, we are now accessing them with our different applications particularly EXALEAD, 3DVIA, Netvibes in addition to the business users of these three software applications family. We are seeing good traction from our software in all of the high-growth countries where total revenue increased 16% in constant currencies in 2012. These results reflect the work we have done in expanding our presence with our different channels, adding sales coverage in key industries, important to our development in the specific countries. High-growth countries accounted for 12% of the total revenue in 2012, up about 1 percentage point. Looking at our results by industries, we are benefiting from solid demand in our core industries and expansion in our user targeted market, target verticals, which we call new industries in our chart, represented about 24% of our total end-user revenue in 2012. During this past year, companies in the transportation and mobility and industrial equipment industry verticals displayed a healthy level of demand with softer revenue growth increasing double digit. In addition, we also saw good traction in consumer packaged goods, energy and construction. With the acquisition of Gemcom now under the brand of GEOVIA, we are now serving natural resources industry. With that, let me turn the call to Thibault.

Good afternoon and good morning to all of you. My comments today are based upon our non-IFRS financial results. In our press release tables, you can find the reconciliation of our non-IFRS to IFRS data. In addition, revenue growth rates are stated in constant currency. Our fourth quarter revenue and earnings results were well in line with our financial objective, coming in at the high end. Total revenue was €568 million, compared to our guidance of €550 million to €560. Our non-IFRS EPS was €1.02 compared to our net IFRS EPS of €0.95 to €1. Looking now at the year in total, total revenue growth was 9% for the year and would have been 8% excluding the Gemcom acquisition and the Transcat divestiture. We posted record revenues, thanks to the double-digit sector revenue growth. With our central licensing model, customers have the flexibility to choose either new licenses or rentals or a combination of both. For the year, new licenses revenue increased 9, and rental revenue increased to about 17% in constant currency. We delivered record earnings per share of €3.37, up 15%, with operating-margin expansion of 120 basis points. During 2012, we have been carefully investing in our businesses, adding people in research and development, marketing and industry solutions, and others as the key area. We have also been expanding our international sales capacity during 2012 in both the value solutions and potential on sales channels. Turning to our cash flow and balance sheet, it had a strong increase in net operating cash flow during 2012. Now, let me share some more details. Overall, fourth quarter of software revenue growth of 9% in constant currency slowed a little from our full-year growth of 10%. However, looking at the components, you’ll see some marked differences which point to further weakening of the environment. As anticipated, we did see more revenue impact on new licenses revenue first due to the customer remittances and also because more companies elected to proceed on a rental basis. For recurring software revenue, we are seeing good renewal levels and, if you recall, FX rates. Our new licenses revenue increased 3% in the fourth quarter compared to 9% for the full year. We saw a lower level of seasonality in new licenses revenue compared to our historic average. And in comparison to the fourth quarter of 2011 where you may recall, we were above our historic average. Rental licensing also affecting new business activity increased about 20% in the fourth quarter and around 17% for the full-year 2012. Rentals were up 29% for CATIA and ENOVIA in the fourth quarter. Taking this further strengthening of rentals into account, we estimate that our new license activity in fourth quarter was, in fact, in the neighborhood of 8% to 9%. We did see some regional differences with respect to new licenses or rentals, with Asia seeing good new licenses revenue activity. Regionally, the highest growth in rentals came from Europe and also from the Americas. Turning to recurring software revenue, it was a good quarter and year. Recurring software revenue increased 11% in Q4 and 10% for the full year, benefiting from our new licensing activity, solid trend across the company with respect to maintenance renewal rates, and good growth as we discussed in our rental licensing. As anticipated, services and other revenue growth slowed in the fourth quarter to 3% compared to earlier in the year, largely reflecting the spinoff of Transcat. For the full year, revenue growth was 7%. We saw a very nice margin progression for the year, finishing at 5.7%, reversing the negative results for 2011 with an improvement of 7 points of margin. Turning now to the regional review, Asia has been showing good comparisons for the year, and this continued in the fourth quarter, leading to total revenue growth of 14% for both the fourth quarter and full year. Asia’s results reflect two key dynamics, first, Japanese customers resuming dynamics following the natural disaster in 2011; and second, strong demand from companies in Korea and China. In the Americas, total revenue increased 9% in constant currencies in the fourth quarter with double-digit software growth for several brands not fully visible, including ENOVIA. For the year, the Americas total revenue increased 7%. All in all, Americas’ growth strengthened in the second half of 2012. In Europe, we have seen a softening of the environment in the third and fourth quarters, with revenues increasing 5% in the fourth quarter. Our strongest performances came from our two largest markets, Germany and France. For the full year, revenue increased 8% so a pretty solid result. Moving now to our brands. Our PLM businesses grew 8% in the fourth quarter and 9% overall for the full year. The standout performance for the year was in our Simulation business with SIMULIA with strong demand across a number of industry, well-balanced growth across our three regions and strong interest by large customers, and also now by assembly customers. CATIA showed a good dynamic for most of the year, leading to new licenses revenue up 8% in 2012 and a very good dynamic on rentals, as well as maintenance renewals. In Q4, 29% increase in rentals for CATIA. Then we ended the year with a great fourth quarter. As anticipated, ENOVIA was more impacted by the weakening of the macro environment during the second half of the year with software revenue in fourth quarter which was flat. However, we did see a strong increase in rental licensing, up 29%. So, some of the new business activity is not entirely visible. For the full year, software revenue increased 7%. Some key points I would like to highlight are our strengthening position in consumables and retail with (inaudible) performing well. SOLIDWORKS software revenue increased 11% in the quarter and its growth was higher by 13%. We continue to see hesitancy in the market, with the quarter benefiting impact from some special programs and favorable comparison through fourth quarter of last year where recognition of late-quarter activity shifted to the first quarter. For the full year, SOLIDWORKS software revenue increased 12%, with new seats increasing 11%. Turning to our operating expenses. The increases are principally tracking the growth in employees and also higher marketing investments. The average head count increased about 6% compared to last year. And we invested in raising our visibility with our global advertising campaign. Moving now to our cash flow and balance sheet. Here are some key points I would like to share. It was a record year with net operating cash flow increasing 26% during 2012 to €566 million, thanks to our net earnings and working capital improvement. Net operating cash flow represented 133% of our non-IFRS net income. During the year, we used cash to expand into a new industry, natural resources, with the Gemcom acquisition to add dashboard intelligence with Netvibes and to bring intuitive room and store layout design with SquareClock. In total, net cash used for acquisitions amounted to €282 million. We also repaid our €200 million debt facility in December and the dividend paid this year increased by 33% to €88 million. Cash received for stock options and share repurchase were much lower in 2012 compared to 2011 when, at that time, several 10-year stock option programs were reaching maturity. The number of shares repurchased was slightly above €1 million. And revenue totaled €485 million, representing a decrease of about 1%, compared to last year. However, looking more closely at the changes due to activity, currency exchange rate and the spinout of Transcat, the unearned revenue is, in fact, higher by about €32 million activity-wise, so pretty much where we would expect it to be at this time of the year. Now, let’s discuss our initial financial objectives for 2013. The company will enter 2013 well-positioned. As Bernard outlined, we are pleased with the reception of our New Horizon 3DEXPERIENCE and also, by the reception of our Industry solution experiences. Customer response has been excellent. Our operational initiatives during 2012 have strengthened the entire organization and our expansion initiatives, particularly with respect to growing capacity in our indirect channels have also strengthened our partner networks. While we were improving, however, the macro environment has been softening. And we saw it in the second half. Therefore, in constructing our initial 2013 outlook, we look to the current business environment as the basis. In addition, we were and we are assuming a significant currency headwind in 2013 based upon what we see right now. With different factors with us to set an initial revenue growth objective of 5% to 7% in constant currencies for 2013, similar to our initial objective last year despite the softening of the macro environment. We anticipate a good level of recurring software revenue growth, just slightly offset by lower anticipated growth for new licenses and services. With respect to our margin outlook, we will continue to invest organically despite the environment and we look to our midterm growth objective for our business. Thanks to our ongoing focus on operating efficiency, these investments will be made while also maintaining a stable, in fact, actually, slightly increasing operating margin at around 32%. Our earnings outlook for growth of 2% to 7% reflects our revenue picture, as well as it assumes true cost and currency headwind all along the year. For the 2013 first quarter, our objectives are for revenue growth of 5% to 7% in constant currencies on growth in recurring software revenues, an operating margin of 28% to 29%, and earnings per share growth of between flat and 7% growth. Importantly, we have also assumed a U.S. dollar exchange rate of $140 per euro, and for the yen, ¥120 per euro for the whole year of 2013. Let me now turn the call back to Bernard. Bernard Charlès: Thank you, Thibault. During 2012, we strengthened the company in all areas. (Audio gap).

Please continue to stand by. Your conference will resume shortly. Sir, hello? François Bordonado: Hello.

Hi. Hello. François Bordonado: Hello. What’s happening?

Sorry. Your line went quiet in the conference, so we couldn’t hear you. François Bordonado: Okay.

We can hear you now, if you’d like to continue. François Bordonado: We would like to continue to take the questions, please.

: John King -- Barclays: :

Thank you. Thank you, John. It’s Thibault. Can you hear us well, John, now? John King – Barclays: Yes, very well. Thank you.

Okay, very good. Okay. Well, I mean, we are trying to guide the best we can. And it’s not an easy exercise in the current environment. We have certainly good assets to do it. But how should I say it? It is not completely scientific. So, we are not trying to guide systematically to something lower other than what we are going to do, right? We are going to guide at a level that we believe very strongly we can deliver. And certainly, we welcome the fact that from time to time, we are able to deliver better than what we guide. But I cannot tell that we are deliberately trying to lower the guidance by 6% for each quarter. John King – Barclays: Thanks. Understood. And then if I could just – one other point, really, of clarity. You gave on the previous call the license revenue growth including the impact from the rental deals would have been more like 10%, I think, ex-currency. I just wanted to confirm that was the case and then whether there was anything from – whether you’ve included in that number the key for 2011 rentals as well, or what we should actually think about for that number? Thanks.

Right. Accretively, it’s a computation, actually. You look at the Q4 performance and you compare it to the full-year performance and you see that there is a peak of rental activity in Q4 compared to the full year and you can say then there’s better rental activity into what would have been new licenses purchase by customers. And in fact, the activity peak was very true for CATIA and ENOVIA in Q4. The rentals for CATIA and ENOVIA are up 18% for the full year and – roughly – and they’re up 29% in fourth quarter. So, I confirm, by the way, the fact that if you look at the new licenses for Q4 figure and you rectify it by just CATIA and ENOVIA better activities, if these new rentals would have been purchased licenses, then the new license revenue would have been up by 9% to 10%. John King – Barclays: Okay. Great. Thank you very much. Bernard Charlès: Yes. Welcome. Next question?

Your next question comes from Mr. Josep Bori. Please ask your question. Josep Bori – BNP Paribas: Hi. Thank you very much for taking my question. I’ll ask two if I can. The first one is a bit of a bigger picture one, but in terms of the penetration of V6 among your customer base, can you give us a sense of where you stand today? Probably it’s better by brand because I would assume that ENOVIA is for the handling and the foundation or the infrastructure layer and CATIA probably is at early stages. And then kind of the second set of short questions more on the rentals dynamic that we’ve been discussing on and on in the call. Just sorry about that. But just to understand, what sort of growth are you embedding in the guidance if you think about rentals drivers one side and traditional license in the other? I mean, is it going to be more driven by rentals or license? What’s your thought process in that specifically for Q1, I think? Because when I tried to do the math on the guidance you had provided, I’m kind of expecting a license growth that’s going to be quite low, even worse than what we’ve seen in Q4. Thank you. Bernard Charlès: Thank you, Josep. The – on the basic penetration, a few key statement first. Number one, in new markets with new industry solutions – when I say new markets, it should be – new industry sectors. We basically – by default is to go with the V6 architecture. Of course, at the beginning in those industries, the orders are small orders because those are more pilot programs. You never stock with huge, huge – big program at the beginning. You just expand as you are successful in implementation. Point number one. Point number two, for the existing – which to come back to your question or connect to your question. For the existing customers, we see three types of situation. The by-default situation is expanding user base, not touching the existing user base which often is in the V5 architecture to really reach new roles, new kind of things that the company wants to do on interviews, V6 capabilities, new industry solution capabilities in this area. That’s type number one. Some of those customers are really showcase customers, for example, going to system design or things that are not possible with the V5 portfolio. Type-two customers are those who are preferring the move to the 3DEXPERIENCE platform and wants to establish first a PLM backbone. If they do that, they might have some PDM legacy. Most of them, they are PDM legacies and this kind of things. And they want to establish a more out-of-the-box environment. You have seen in the last two years significant ENOVIA decisions coming from that category two. And then you have category three on that. It’s not by priority or type three, if you want, which our customers basically were saying, okay, I want to create the next-generation processes and I want to take all the out-of-the-box industry processes. And this happened a lot more in industrial equipment, for example, last year or electronics than it did in auto and – why we have a few in auto who are really going to the next-generation platform right now, and we’ve mentioned some of them. So, the penetration is – can be measured. If it’s measured in terms of use of the print, it’s rather small. But if it’s measured in terms of how we change the landscape going forward to expand the footprint, then it’s a significant level. So, basically, whether you are adding, expanding or building up new customer situations, we start with small installations. The only area where we start with big implementation is when the company like, we mentioned Pratt & Whitney Canada, but we have others, Dassault Aviation from U.S.A. Our biggest one, where it’s the largest, so, that’s basically the landscape right now. So, the main focus this year is to prepare the expansion of the footprint in such a way that when customers generalize the solution, the Industry solution experiences, they are ready to expand it, not to replace what they have but to significantly expand what they have. I think this is visible with the formidable growth. I think it would be more visible as we move on. I think the gross rental, Thibault? Those are the contribution of rental.

Yes. Josep Bori – BNP Paribas: Yes.

So, the rentals in 2013, the expectation is it could be slightly below the performance in Q4 for the full-year 2013 in rentals, which means that we would continue to have a good rental activity. The recurring in first quarter, we expect it to be both at the same level compared to Q4. So, you’re absolutely right, we are planning on a relatively weak new license revenue for the first quarter. However, when we look at the complete year for 2013, the way the guidance has been developed is with a progressive strengthening in new license activity across the year. The last point I should highlight also is the fact that the additional growth brought by the Gemcom acquisition, of course, ceases at the end of June with an effect on both new license and recurring for the second half. Josep Bori – BNP Paribas: Okay. Thank you very much. That’s very helpful. Any chance you could give a more precise kind of numeric range for license kind of full year for 2013 sort of a range, I don’t know, 5% to 10%, something like that?

Okay. So that – it’s my day of – you must appreciate that this exercise has become more difficult. I really want to say that when you look at Q4, it’s very obvious that it’s a little bit more difficult now to predict new licenses because of rentals becoming more popular. Josep Bori – BNP Paribas: Right.

But to answer your question, at the high end of our guidance, the expectations for new license growth today is in the range of – total revenue 5% to 7%. Josep Bori – BNP Paribas: Okay. Okay. Thank you very much. François Bordonado: Okay. Thank you, Josep. Next question?

Thank you. Your next question comes from Jay Vleeschhouwer. Please ask your question. Jay Vleeschhouwer – Griffin Securities: Thank you. Good afternoon. Bernard, Thibault, I’d like to start with a couple of questions regarding your industry solutions. Could you talk about what your rollout plan might be for this year in terms of expanding either existing solutions or introducing whole new ones? And in terms of the business impact, is it necessarily the case that, industry solutions for any given or average customer would result in more revenues to you from that customer than under your prior method of selling solutions perhaps on a more product-by-product or ad hoc basis? Bernard Charlès: By the end of the year, we will have – by the end of year 2013, we will have 29 industry solution experiences. Industry solution experiences are very broad in a sense. Smart, Safe & Connected, for example for automobile and transportation. Mobility is a very wide. Smart, Safe & Connected means you can do virtual crash test. You can build systems engineering for the vehicle, whatever vehicle it is, whether it’s electrical or end-user gasoline engine, whatever. So, in the fast-moving consumer goods, it can be perfect package which means – perfect package means all the process, all the way from design to artwork, packaging and labeling on many other of those questions. So, customers, basically. The value of this is clarity on the business process we touch, clarity on cycle time, on savings. And we are really building a very interesting track record which is very precious to really facilitate basically the customer investment, not as a delta investment but as a way to reduce their current operating cost and understand when they can get the return investment on the current operation cost that they have. So, the ramp-up is going very well. It started first in industrial equipment. Industrial equipment is a very huge market. In fact, it’s almost the number one sector for us, and it’s expanding with automation on many other things like this. So, that’s, in short, what the plan is and why it’s a higher value for customer and easier for them to decide. Jay Vleeschhouwer – Griffin Securities: Okay. With respect to sales and distribution, in light of your comments about capacity, could you talk about your expectations of the relative growth you think may occur this year in terms of BT versus the value channel? Bernard Charlès: We usually don’t communicate that, but I think it’s quite consistent across the board. Thibault, any...

In terms of capacity... Bernard Charlès: Oh, in terms of capacity, also.

We are putting the emphasis on indirect channel. Bernard Charlès: Yes, yes, yes. Last year, the capacity in the indirect channel was significantly expanded. And we – in the years to come, we plan to ramp up this, especially it was expanded in new industries with new type of partners who basically understand those industries. And most of them never serve the other markets we have been serving before, the traditional one. So, they are really brand-new partners committed to really develop certain kind of industries with completely different background and we think that’s very good. The mission this year is to ramp up, then grow and be successful in their sales process. Jay Vleeschhouwer – Griffin Securities: Okay. Just a question on product and market strategy. First of all, is it still your intention to introduce a full CGM version of SOLIDWORKS as had been talked about over the last year or two, something to fully parallel the Parasolid-based version of SOLIDWORKS beyond what you’ve introduced so far with mechanical conceptual? And secondly, could you talk about your long-term strategy or ambitions for the AEC market? Bernard Charlès: On the first question, the – we have, in the last years, removed a lot of external components which were inside SOLIDWORKS. It has been and visible to customers, at least – and visible in terms of moving to the next level of SOLIDWORKS and visible in terms of benefits of performance, scalability and capacity. So, it has been successfully done. We have cleaned up a lot of the dependencies and external components that we thought were not really the right one long term. Related to your question about the Parasolid component, the – we believe that in the next year, the collection of SOLIDWORKS applications will evolve a lot. It’s already evolving with electrical, plastic, now mechanical and conceptual. So, now with SOLIDWORKS Composer as we are building SOLIDWORKS, simplicity style with SOLIDWORKS Composer also. So, the portfolio around SOLIDWORKS is expanding rapidly not only with third party but also with our own applications, and mechanical conceptual is a good illustration of that. Now, in that trend, those applications are going to leverage social, connected on mobile, on the go. Therefore, the scope is very different from an add-on. It’s really expanding the footprint. That’s the strategy we will continue to – now, does this mean that in XYZ years from now, the portfolio will be all on the cloud, private, public and so on? Social, mobile? We have clearly said that a lot of application are coming on iPad this year, on Touch, which basically changed completely the game because, of course, going with those new operating systems on this new connectivity, the platform is not the same and we have stated that the platform will be this 3DEXPERIENCE platform. So, that’s basically the answer. There is no intent to just replace components for what they do today without going to evolution of the needs that customers are expecting to be connected, mobile, touch taking advantage of this social environment that they want to use now for collaboration. So, it’s not a migration of component. It’s the re-definition of next-generation system. Jay Vleeschhouwer – Griffin Securities: All right. And lastly, a quick clarification for Thibault. Perhaps you disclosed it earlier this morning. What was the V6 percentage of new PLM license revenues, please?

It’s 22%, Jay. I also expect the fact that even new rental activity, you find a lot of Version 6. And so, this indicator is, in fact, not the best to understand the increasing footprint of Version 6 in our new license activity, but it is what it is. Jay Vleeschhouwer – Griffin Securities: Okay. Would there be a way to compensate for that phenomenon to give us a more indicative V6 percentage?

Yes, sure. For example, it’s 11% of total revenue. Jay Vleeschhouwer – Griffin Securities: Okay. Thanks very much.

You’re welcome. Bernard Charlès: We’ll take a final question.

Certainly. The last question comes from Michael Briest. Please ask your question. Michael Briest – UBS: Great. Thank you. Bernard, maybe a couple for you first. Perhaps in terms of big decisions this year around V6, obviously some of the automotive companies have made a decision. Do you think there’s any chance that we could get some big decisions in favor of V6 this year? Or do they get pushed out into a later period? And then secondly, in the core PLM space, obviously you’ve made that acquisition today, but what appetite do you see for core PLM amongst larger enterprises to be delivered through the cloud? And then I’ve got a couple of small ones for Thibault. Bernard Charlès: Thank you for the question. There is a lot of things going on with V6 base architecture, new activities, new roles, new processes within the installed base. We have a lot of those around the world. And we want to continue to promote that because this is the expansion of footprint, the replacement of existing supplemental solutions that you might have already, whether it’s legacy code or something. So, we continue to surround, complement and expand the installation we have. And this is the case especially in installation. So, we had nice decisions last year, and we expect to continue to see new decisions this year from that perspective. So, the answer to your question is absolutely yes. Now, we are very careful to not spend time in looking at a topic that is usually with software what they call migration when there is no value to it. So, we prefer to expand the footprint, cover new processes, simplify the customers’ landscape in such a way that when all this is expanded for the customer, it becomes relevant to go to the next-generation processes which they can support with the industry solution experience. Related to the core PLM on the cloud, I think it will happen faster in new industries like CG and CPG than it will on traditional manufacturing companies. First, in A&D, there are a lot of issues related to IP security and many, many other issues. So, that’s one aspect and even in the auto sector or transportation mobility, at large, it will be cloud but it will be private cloud, not public cloud. Clearly, in CG and CPG, we see the use and the opportunity to go faster on our own cloud if we consider, we call this public cloud, it’s not really public per se but it’s public from the fact that the application is running in a shared public environment. So, that’s the way we see it right now. We think that the social aspect is under connected and mobility will accelerate that aspect of having core 3DEXPERIENCE platform online. Michael Briest – UBS: Okay. And then, Thibault, just maybe to get a picture on the rental versus license side of things, what proportion of PLM, say, in Q4 or 2012 was sold on a rental model as opposed to one premise?

Well, for PLM as a whole, we don’t really count number of seats anymore because it’s not so evident with the rich portfolio we have in applications. So, I think – I give many measures, but one that you can keep is the fact that rentals as a percentage of total recurring for PLM – rentals as a percentage of total recurring is 20%. There are no rentals for SOLIDWORKS. So, for PLM, rentals are one-fourth of recurring. Michael Briest – UBS: Okay. And then, just finally, I think you mentioned this morning that you put through a bad-debt provision which impacted deferred and, I guess, debtors. I mean, there’s obviously normally a provision, but could you just sort of quantify how much is it? I think at the half year stage, it was about €9 million provisions. Does it move significantly higher?

Yes. There was a movement to bad debt in two occasions, and the amount is about €10 million. Michael Briest – UBS: So, you took a hit in Q4...

I can even do the full list of small elements. The fact is that at the end of the day, the margin was at 32 million from the standpoint of pure activity. Michael Briest – UBS: Okay. So, the – I mean, it’s bad debts because someone has genuinely gone bad and you won’t get it or is it prudent provisioning?

No, we do a prudent provisioning always, but this bad debt is linked to the insolvency of one of our – the final insolvency, I should say, for one of our creditors. Michael Briest – UBS: Okay. That’s great. Thank you very much. Bernard Charlès: Thank you. With that, we want to thank you for participating to this conference call and to this morning’s analyst presentation in Paris. Thank you for following the company and your interest in Dassault Systèmes. Of course, we stay connected, and we’ll be happy to continue to address any questions you have. With that, have a great day. Talk to you in a quarter from now. Thanks a lot.

That does conclude our conference for today. Thank you, all, for participating. You may now all disconnect.