François-José Bordonado - IR Bernard Charlès - President & CEO Thibault de Tersant - Senior EVP & CFO

Laurent Daure - Kepler Cheuvreux Brice Prunas - Exane BNP Gregory Ramirez - Bryan Garnier John King - Bank of America Merrill Lynch Stacy Pollard - JPMorgan Charles Brennan - Credit Suisse Derric Marcon - Societe Generale François-José Bordonado: Good morning everyone. I'm François-José Bordonado, Dassault Systemes' Investor Relations. From the company, we have Bernard Charlès, our President and Chief Executive Officer and Thibault de Tersant, our Senior Executive Vice President, Chief Financial Officer. I would like to welcome you to Dassault Systemes' 2015 Fourth Quarter Earnings Presentation which is also being webcasted and I would like to send our best regards to a number of our friend analysts who are currently listening from New York City, where I'm afraid it is 4:30 in the morning. At the end of the presentation, we'll take question from the audience and from participants on the webcasted call. Later today, we will also hold a conference call. Dassault Systemes' financial results are prepared in accordance with IFRS. In addition, we have provided supplemental non-IFRS financial information for an understanding of the differences between the two. Please see the reconciliation tables included in our press release. Now some of the comments we'll make during today's presentation will contain forward-looking statement which could differ materially from actual results. Please refer to our Risk Factors in our 2014 Document Référence. Let me now introduce Bernard Charlès, President and Chief Executive officer. Bernard Charlès: Thank you, François-José. Good morning and thank you very much for your interest in Dassault Systemes. 2015 was a good year and you have looked at the press release this morning but I would like to wish Thibault to give you some more insights about why you think it was a good year, and a good base for our long-term growth, double-digit organic new license as you may have noticed, EPS was up above 20%, organic operating margin has been improved. I remember the doubts at the beginning of 2015 on that topic, especially with the dilutive aspect of some of the acquisitions. So you can notice that the organic improvement has been a reality basically for 2015. Large account sales are progressing very well. Industry verticalization and diversification is also working very well and I will come back in more details on that, as well as the adoption of industry solution experience with the 3DEXPERIENCE platform. So I believe we delivered an old KPIs that we mentioned at the beginning of last year and they are I think well aligned with the perspective for the long-term. This is what we want to measure going forward. And last, but not least, our footprint in the worldwide market has increased significantly with 22,000 new clients in 2015 which I think, as you know, we continue to grow existing clients. So the footprint is an important aspect. I believe we're significantly over 200,000 enterprise clients in the world right now. So the agenda, the Q4 trends, the full-year status, the financial headlines, of course, and then what we see for 2016. So business review, first, what you can notice here is the new license grows double-digit at 11%, on the Q4 15% for the full-year. You can also see the strong operating margin under Q4 and the overall full-year operating margin at 30.8% which is a growth of one point on the full-year on 3.3 points, on the Q4, and of course the resulting EPS up 24% for the full-year. So I think operating margin leverage is there. The result on the EPS is we qualify it excellent. And the third point is strong new license for driving the top-line. On the balance of this software dynamic, clearly, the first parameter is the acceleration of the adoption of the 3DEXPERIENCE platform. The platform is much more than a version of a software; it's a new way to do business. The platform is what makes it possible for us to deliver industry solution experiences. And keep that in mind because I will give you a few names of industry solution experiences that shows that it's not anymore selling tools. We are about selling business solutions to companies. I will come back on that topic. So the adoption of the platform is an important aspect which has been supporting well the growth of CATIA as a product brand, as well as ENOVIA. As you know now ENOVIA is not anymore the platform itself, it's a collection of business applications. Strong recurring revenue for SOLIDWORKS. Beginning of this week there was a SOLIDWORKS world in Dallas. I just came back from there, and we've had an amazing, amazing dynamic with 8,000 participant at our event. So there is a lot of attention for the makers, small companies to really adopt the SOLIDWORKS solution. I think we're gaining share on that side too and strong SIMULIA grows as you can see. Also software is becoming a big line and that it's growing at 26%. So the total of this aggregate is up to 12% for the full-year 9% and we're pleased of course with CATIA, ENOVIA, and SOLIDWORKS as the core brands. But others are growing well too. On the other package you have not only SIMULIA but you have the manufacturing aspect. On the GEO side, America is up 14% on the full-year, 9% for Q4; Europe is up 11% for the full-year, 5% for Q4, and Asia 12% both for Q4 and full-year. What can we say about that? Good dynamic in Europe, good performance in Europe, good dynamic in America and we still have, continued to have a strong growth in Asia. Should be understood that the acquisition effect is stronger in 2015 in America than it is in Asia, so it shows that the organic growth in Asia is still strong. About the large accounts, noticeable is the new license revenue is up 19%. The average deal price is driven by the industry solutions and is up by 15% which really ends up being a factor for sales productivity. Our intent is to continue to grow the size of transactions taking advantage of industry solution and the way we package business offer for our clients, so we see as tangible results here with new license, sales productivity increasing 15%. On the 3DEXPERIENCE deployments are very large scale project, 80 of them were successful and we of course hope to increase that number. On the diversification side, we have also; I think good news on good demonstration that what we have developed on the investment we have done over the past years are really well targeted. The industry diversification represents 30% of the total revenue which is a two point increase as compared to 2014, year-end 2014, and two point that's a big factor. Why so? Because new sector by definition we start with a small footprint as compared to traditional sectors like aerospace, automotive, and others. And to grow two points you need to grow much faster of course in terms of provided the fact that the footprint is smaller on the new industries. Among those drivers, life science and energy process utility, as you know, it's a big sector, consumer packaged goods, consumer goods. The takeaway here is our industry solutions are very competitive in their sector and we do plan to continue to extend our total accessible market from that perspective. While the core industry is still growing almost double-digit not exactly it's 9% and we're really we want to continue to focus on the core industries of course. Why so? Because we are expanding the disciplines we cover. For example, point of sales for automotive companies using now 3D displays and many other digital information, manufacturing and production system of course are part of this. So a good balance of industry diversification. A few example here of I think prestigious names that been adopting our solution, as you know, we have invested a lot in the life science and we believe this sector is a sector where we have a lot of possibilities to expand in the future. Amgen has selected BIOVIA. BIOVIA, you may recall, is the new brand. BIOVIA is the CATIA of life science to make it short. We won BIOVIA and BIOVIA today is the number one brand in life science, it's a collection of products that we've created on the acquisition of a company that was called ACCELRYS in 2014. We have developed also internal technology called bio-intelligence and we're putting all these solutions together because we believe the life science sector is a sector that must adopt new platforms for innovation, and is behind many of the industry sectors. So that's a good illustration. Another may be astonishing, and we took it as a kind of an astonishing win may be for you. Chevron which is adopting the 3DEXPERIENCE platform and they're adopting it for perfect product on efficient plant operation. Well when you see the oil and gas industry and what has happened in the last two years, I think, it reveals that there is a lot of potential to improve plant operation but also packaging underway, they offer their final products to the market and that's a good illustration of it. In some way Chevron is adopting the P&G methods, the Procter & Gamble methods about transforming the way they package products and offer products using similar solutions. General Mills, France, with a famous brand, Häagen-Dazs. They are using their perfect shelf. What is this is how do you package product in such a way that when you present them on the shelf you get the maximum efficiency in terms of marketing. This is probably a sector where we're not expecting Dassault Systemes, a few years ago and where we're bringing a significant value. Why so? Because if you want to do this kind of packaging for multiple countries, the leveling and the packaging has to be well thought, and it has to be, what we call, configured, in a sophisticated way, so you can sell your product under the best conditions and put them properly, provided the distribution of the retailer channels that you have. It's far more complex and people expect and we bring with the experience platform here since that have never been done in the past. So that's another proof. What I wanted to do with those proofs is to show that industry business solutions for new industries are relevant. And last, but not least, this type of industry solutions wins are driving the 3DEXPERIENCE platform based on the V6 architecture. And you notice here that on the second half the acceleration of the adoption of the new generation of platform is up 36%, from 20% first half, and on five points in 2015. I would like to look at the transformation of traditional industries. There is a lot of investment around the world in the transportation and mobility sector and many debates about sustainability of that sector. But it's clear there are also a lot of newcomers Tesla, well known Dassault Systemes 3DEXPERIENCE client. Faraday Future at CES made a reveal of what they are doing. And I would say that most of all the new players were inventing the mobility of the future smart connected cars of vehicles are adopting the Dassault Systemes 3DEXPERIENCE platform. I've taken the example of Faraday here. They have adopted the 3DEXPERIENCE platform. We are the only technology partner that they've announced. And they have adopted a solution which is called Target Zero Defect. And one solution is under that name which is how do you do vehicle integration and remove all possible risk of technical issues. And the second solution, business solutions that we have is Smart Safe & Connected. Why do I insist on that point? Because many of the observers are still asking us do you sell CATIA, or do you sell this product or these products. We are going to provide industry business solutions. So the commitment when we deliver those solutions is a customer if you use those solutions you minimize the number of mistakes you're going to do in the product integration, dear customer, if you select our solutions, you're going to do a smart vehicle that can be connected in a reliable way. You can see the gap between selling a nice tool to do a nice shape or selling a business solutions that helps you to do a connected safe vehicle. So the future of Dassault Systemes is about industry solution experience on that standpoint. Here is an illustration. I've used something that you can find by the way on YouTube about the revolution of how to design, create, produce those kind of equipment. You see here typical video that we presented in the past about traditional vehicles that are on the road today. But this is a new vehicle architecture, completely new revolutionary way to create electrical vehicle, modular. And you can notice the extreme simplicity of those vehicle but also the extreme sophistication of the architecture. The sophistication of the architecture is coming from the massive simplification of the end result. While the product is far more modular, you see for example here the electrical power engine configurations for different type of vehicles. So it's almost like illegal, where the performance of such kind of companies will be based on the portfolio you can create, based on a modular architecture and how can you produce them, those vehicle, in a very efficient way. That company is now creating a plant not in China but in Arizona with a revolutionary plant using Dassault Systemes digital manufacturing solutions to really create agile production systems, modular production systems. That's the core of how much we are transforming the future of manufacturing. So this is not a one-try. This is a trend that will apply to all manufacturing sectors in the world. So that's why I used that example. This is another illustration. Ship building sector is extremely competitive, huge CapEx, huge OpEx. Meyer Werft is a German company and you can see the complexity of such kind of ship, it's both a city, a luxury set of hotels, all confined in one extremely complex environment. There is no way that this could be done on ready on time without total digitalization of the process. And we're pleased to see that this customer who is a long-lasting customer of Dassault Systemes is now selecting the EXPERIENCE platform. But it goes beyond that story because this is about the future of extremely complex products that could be not a ship but an entire city. And you've noticed that last year, we signed with Singapore, where they are going to use our platform to do the actual twin of the city, so they can plan the evolution of the smart city at first using the stimulation platform. So we want to continue to grow and change the landscape of those industries by creating a full digital environment not only for the creation, but the production of the service of those products. Another more heavy industry equipment company, Doosan, as you may know, one of the largest market share in the world for us is both Japan and Korea and they continue to really alleviate our capacity to stay competitive despite the cost structure and this is another illustration of that. Now, because we are at the beginning of a New Year, I, every year give you a quick update about the strategy, which I don't do during the quarters, but I want to give you some inside about where we are going next. You remember that in 2012 we said Dassault Systemes will become 3DEXPERIENCE Company, the best company on that side by 2021. We then said we are going to do industry solution. We then said we are an economy of experience. Because we are in an economy of say experience how do you create experience? We are not in a product economy anymore. We are in an experienced economy. We you drive a Tesla, you don't have a product, you have a total experience of driving connected self autonomous. How do you create those kind of things? So let me tell you a few quick things about where we intent to invest and accelerate our investment in both R&D and customer acquisition. We believe that there are five drivers which are essential for the digitalization of the world. The fact that 70% are in cities, create the needs to think about products in different way. The utilization of resources must change. Of course, personalize health is happening, supply has to be transformed, and of course, we need to continue also to help education to be transformed. On the first topic I'm pleased to -- that Dassault Systemes is recognized as extremely contributive to the sustainable world with our purpose and vision about what we want to do, which is not less than harmonizing product in your life. That's why we invested and put more than €1 billion on life science to create new categories of products in natural resources, so you have the product, the biosphere, and geosphere, and you can do integration of those things. We are number two in the world, all sectors included. And I notice that that number one is BMW and the number three is SudoTech both are our clients. The second thing, the 3DEXPERIENCE platform is not a technical platform, it's a business platform. It helps to connect the criticality. If Uber exists today, it's because they have invented a new business model and they can run it online on a platform. The future of manufacturing is about doing the same. It's not going to be about producing more of the same thing, it's about changing completely, using the virtual world to optimize the physical world and provide new type of services. So we want to connect the disciplines, sales, marketing, engineering, and production. We want to connect the product innovation with the business innovation. When you create a product, what is the business model for product? So the 3DEXPERIENCE platform is a business platform. It can attract cost; it can help you build your future business model. And of course, we want to do not only software applications, but also provide content on services online. So it's a big deal. We are doing step-by-step. We are learning with customers, how to do it. But we are here for the long-term and for mainly creating this transition. So what it means is very profound, because it means that we have to be able to connect the way marketers works, the way people in sales work with how engineering and production work. So we are connecting those networks together. At Jaguar-Land Rover for example, we are able now to predict real time, weight and cost of a vehicle under development. Not only measure it at the end, but predict it at the beginning. So the landscape and the implication of the landscape is really significant even for clients using SOLIDWORKS. We want them to be connected to a business platform online. This is what you see here, design platform connected to the business platform. So a few illustrations in two big domains which are completely different from each other. On the city side, the Virtual Singapore isn't done just for fun to have nice things for the minister or the government, this is really real usage. I'll give you a very quick story. The question that we were asked were, can we predict how are the parents driving their kids to school? They suspected that 60% of the kids were going to school being driven by the parents with a car, which congest the city. We said okay. We have now the virtual twin of the city. Let's put a smart object with all the kids between 8 and 16 and we're going to track them on the city. And we will do big data analysis. And in less than a month we demonstrated that what the official consider being a 60% was only 30%, but we also discovered that the kids were going not at all using the mass transportation the way people were thinking about, they were doing completely something else. And the mass transportation was not well-coordinated for the kids. We also discover that young kids were much more sporty on walking more than the elder one. So we discover all this. This is what a digital virtual twin experience of the city can allow. But think about how much it can bring for waste management, energy management, smart transportation and more. This is what we are doing. It's a serious project and I think it will create a new standup for not only Singapore but for the new China cities. The second remark, so this is a big trend. Second trend is fab labs. How can entrepreneur creates things and do things not only ideas, but fabricate them? And we are now in one thousand fab labs in the world. We are connecting smart objects together on products like Netvibes for example, got the award for being the best development platforms for IoT, internet of things in the past weeks. So we are investing at this system to create platform where fab labs can help young entrepreneurs to develop new type of solutions, not wait for large companies, slow movers to invent those products, but let the young generation invent and create products. This is where Dassault Systemes is on the SOLIDWORKS World this week with 8,000 people in the meeting saying we want to create the products of the future is a part of that dynamic and that's why cloud is very critical for us. Last, but not least, we are really transforming also the business model. We have this great recurring revenue flow for companies, but we are also providing cloud environment under subscription. And we see now that even companies doing small airplanes are saying I'm going to do my airplane, on the cloud, I will not buy the equipment, I will not install the computers, I will take my PC connected to the Dassault Systemes cloud and develop my airplane, Elixir in France, Joby Aerospace space go there look at YouTube Joby Aerospace, J-O-B-Y Aerospace in the Silicon Valley creating new equipment on the cloud directly. So that's the way the world of creation manufacturing is happing those days. The Elixir is here. It's a small team. They said, we're going to create an airplane, we are going to certify it and it's going to fly at the end of 2016, 2017 all this on the cloud. So we are not really doing that just for fun. It's becoming a major transformation in terms of economical model for companies. And you see here some of the statement, you have the paper. SOLIDWORKS, we are also transforming the world of SOLIDWORKS. It's not anymore a package on a PC; it can be connected to a hub where you can get ideas from friends, real time around the world. Please can you help me to solve that problem? Yes. So it's we want this platform to be the RB&B of the creation. That's what we are doing at Dassault Systemes, and why we are transforming this logic of creation. So the landscape. This is an example of how quickly you can do? You go, you get your ID, you connect to the platform and just you can design slow browser part, share them with friends, you just send the link the guy can modify it. And here, you can see now that we are inventing smart robots that will create the part for you. This robot is showing you where the material should be automatically and then you just put the shape and the system will adapt and create the result in part. So the world of design, the world of production, and the world of creation is changing thanks to this kind of platform. This was for the support of little camera, but you can see it's becoming very fun. It's almost game like. This is not anymore the old way of doing design. This is what the new generation of kids wants to use to design and invent new type of solutions. You have the social part of it. You can share ideas, like videos on different platforms here, it's about the design. And of course, you can use your mobile phone or your iPad to see it and share it with friends. So that's a mega trend. We are in for the long-term. And the mega trend of design is really a mega trend where design is going to be done differently. [VIDEO PLAYING] Can you imagine that such kind of design now can be done on the cloud? No CapEx to install it in your company, you connect to it and you can do the design real time from Tokyo. That's what we have been doing in the last year to prepare our cloud environment for design. The second mega trend that is science. Of course, you see the bronze that serve each of those domains CATIA, SOLIDWORKS et cetera. So we have a second mega trend that we see in science, because 3D printing is transforming completely the way we are using materials as life science is. And of course, we have all the elements in place to make this be transformational. I will not go through all the technical aspect, but the challenge for the future is to invent new materials that will be completely different from what is available today, because we can now start from the atoms, reassemble the atoms, and create materials that will be reusable for 3D printing. In 3D printing, you can also have hybrid materials, because you put that by layers. And because you put that by layers you can continue to change the nature of materials to create extremely sophisticated rather simple new products. So the multi-physics, multi-discipline strategy on the fact that we can start from the atoms to the full behavior of an airplane is a very key part of the Dassault Systemes strategy. Here is a video that illustrates to you the type of stimulation we can do, whether it's flow structure. We can validate now for those customers which are more -- the more advanced. We can 100% validate the design in the digital world without having to do it on the physical prototyping. Are all industries there? Absolutely not. But are they going there? Absolutely, yes. Because there is no way forward aside of doing that, if you want to reduce cost and really create a higher reliable and highly safe products. On the last mega trend, we see a side of manufacturing is of -- in manufacturing is an holistic approach to manufacturing. Manufacturing will become a service. Manufacturing will not be, I have a plan, I improve to run that plan with more efficiency. It's going to become a service. We believe that different companies in the world will provide the manufacturing capacities to other sectors. It's going to become a service. So how do you transform the world, very static world of manufacturing to become manufacturing as a service? That's the platform we are building in place, building for Dassault Systemes, and creating real time optimization of how you produce things, justification of Apriso acquisition, justification of the many acquisition we did in that sector presently. And we believe that we are going to transform a sector which is very conservative, transaction based with old ERP system to a dynamically reconfigurable production system. So I know that you are already thinking about who are going to be our new competitors. But we want to change the landscape of that side. So this is about how you do modular, how do you adapt production systems and how you make them more agile. And you've this in almost all sectors, including even moving line for aerospace, where now it's a very, very different process, which is highly simplified for extremely more complex programs. Supply chain is becoming very critical. Up to now it was almost outside the optimization of the production system and it has to become inside, because the reality is no companies on the planet have a real crew about the green impact, no one. They know what they do themselves, but they don't know how the full scenario is happening with all the suppliers and that's a big problem for sustainability. So we need to create a digital view of everything which is happening to improve the sustainability in that world. So that's what I wanted to tell you about the strategy update. And here is a quick demo about supply chain after the acquisition of Quintiq. [VIDEO PLAYING] So the world of marketing is also evolving in a big way and that's connecting sales and marketing and creating new experiences is part of that. So with that, that's the -- last part was the long-term view where we're going, justifying what we have done up to now and why the basis are the right basis for the future. But to make sure that we do not over read the market. Let me call Thibault. So he will give you some insight about what we have done in 2015 and what we want to do for 2016.

Good morning. So a quick summary on a few figures, you already know them. But I think there are a few highlights to give, nonetheless. Our software revenue first. It grew by 9% in Q4 and of course Q4 is fully an organic quarter, and it grew 12% for the year, and it was 8% growth from purely organic standpoint. This software revenue is made of two components essentially new licenses and this was part of our key objectives, as you know, for 2015. So we grew in Q4 by 11% and by 15% for the full-year, but the growth of new licenses for the full-year organically was 11% and that's consistent with the objectives of growing it double-digit. We already did it in 2014 and we will see later that we are planning to do it again in 2016. Recurring revenue, very important of course, 70% of our software revenue is recurring. It grew by 7% in Q4, 10% for the year, but 7% from an organic standpoint. So you can see that Q4 was in fact very equivalent to the full-year in performance when we look at organic figures. Services was going up by 3% in Q4, slightly better than the full-year which organically was 1% growth. Our focus is on embarking system integrators into the deployment. Margin was up in Q4 at 17.5% compared to 14.2% in Q4 of last year. Margins, speaking of margin that was our second key objective of the year which was to grow organically our margin by 100 basis points. And as you can see here we grew it by 120 basis points. Thanks to the Q4 performance which was good. Currencies were also of course a contributor of an additional 100 basis points and the acquisitions were dilutive by 120 basis points. So the net-net we grew operating margin by 1 point from 29.8% to 30.8% in 2015. EPS, as a consequence, grew by 22% in Q4, 24% for the full-year. And my favorite chart is the operating cash flow of course at €633 million for the full-year it was increasing by 27% compared to 2014, which I don't mean to probably highlight more than just the figure. Except to say that we have a net financial position of not far from €1.4 billion and €1 billion loan in addition to that. So the cash position of €2.4 billion at the end of the year. Little bit more details may be on cash flow for Q4. Of course a very nice increase at €103 million compared to €55 million last year. Nothing really to comment except you know that the net income was obviously increasing nicely, adjusted for non-cash, it was an increase of €33 million. And the other thing I want to highlight is of course the unearned revenue, which was also a good contributor at €51 million or €16 million differential compared to last year. In total, if you look at the annual revenue line in our balance sheet, excluding currency impact it is going up by 13% compared to the end of 2014. Let's turn now to the objectives. So in fact when we look at the macro environment it's difficult to see it as much stronger than in 2015, when we look at it for 2016, and what is for sure is that it's going to be more volatile. More volatile because of all the risks that have accumulated, and you are perfectly aware of them. But to mention a few geopolitical, currency, interest rates, and I'll stop here. Energy. That's an interesting debate but it's aside from our results, so we could cover it in private discussions because I think that it's always hard to see stock markets reacting negatively to something that is overall good news anyway. It's my humble opinion. So with that, what is for us, where is the optimism coming from? It is coming from the product cycle; it is coming from the acceleration that Bernard mentioned of good experience and the Version 6 architecture in Q4. With all the good references that has been deployed and created 80 deployments in 2015 of it in large accounts, this is the best business for selling and marketing it in 2016. Because of that acceleration, we believe we need to invest. We also mentioned multi-physics, I mean there are few areas that would be interesting to mention but we want to improve investments in R&D and sales in order to cover the market. With that, we are targeting in fact a revenue increase of 6% to 7%. In fact from an organic standpoint that's exactly the same we were targeting for 2015 and we did deliver organically 7% revenue increase in 2015, as you know. So it's not very different. We are also targeting a double-digit new license organic growth in 2016; it will be the third year. And a stable operating margin as reported, however, you need to know that we see a few currency headwinds and we have embedded into our guidance a few currency headwinds because when you look at British Pound, you look at the evolution of the Renminbi, you look at the Korean Won, you look at the Australian Dollar, and unfortunately the list is even longer than that, they are all weakening as you know. And so this assumption is leading to stable operating margin but in fact in order to deliver it, we still need to grow the organic ex-FX operating margin by 50 basis points. So all in all, I think it's a modest investment that is going to serve us very well for the growth in 2017. Based on that EPS, EPS should grow by 7%. And as I mentioned we have this currency headwinds it's going to ex-FX a double-digit growth of EPS in 2016. The last point I really want to mention on these objectives is the fact that first quarter in our estimate is going to be the weak quarter of 2016. And so we of course prefer to be upfront with that. There are few reasons for that. But one of them is the very strong first quarter we had in 2015. If you remember the 24% new license growth in first quarter of 2015, it was truly a very strong quarter and it's very difficult to repeat that kind of performance. In 2016, because of this volatile environment, we believe our customers are growing to tend to spend their investment budget in the other quarters other than the first. So you can see that all in all what we are targeting is to go over €3 billion in revenue in 2016 and with an EPS of €2.40 more or less give or take for the year. And with that, I think we have ended our presentation and we are now ready with Bernard to answer any questions you might have. François-José Bordonado: We will take first question from the room and then we will give the floor to the call.

.: Bernard Charlès: Yes, Laurent.

I have just two questions. The first is on your other product line. You emphasize on the strength of SIMULIA. So I was just wondering what were the drives to get to this 6% growth in the quarter. And the second question is more what happened on the M&A side, with Siemens acquiring simulation. I was wondering, what was your position on that? And if your margin expansion of less than 1 point this year on an organic basis, is it because you have not made M&A and then you want to grow more organically, and then you need to invest more in sales? So if you could elaborate on all that, will be great. Thank you.

Okay. So the other software line is growing 6% in Q4. As you may have seen it's growing 24% for the full-year and from purely organic standpoint it's growing 11% for the full-year. So I simply would like to mention that in this line, you find smaller brands which are earlier in their career and so there is more volatility from a quarter to another. So I think the real figure you need to bear in mind is that the other software from a purely organic standpoint grew by 11% during the year which is very consistent with the rest of the performance and as it should be little bit higher, you know that than average growth. Your second question is related to may be Bernard will want to take it on Siemens and CD-adapco. Bernard Charlès: Well of course we have looked at it. And there are many, many elements that we have taken into consideration to on that case. First of all revenue invested in CFD and we believe that the CFD market has been a very conservative market and today we have several patterns on the topic which are breakthrough, new approach for CFD. So when you are faced with an upcoming new approach to a domain which is quite scientific versus acquiring an installed base we've highly fragmented R&D. I think we came to the conclusion that we should continue our own path on that. It's an element which is necessary for the CFD but we think -- for the multi-physics sorry, as I presented a moment ago. But I think we can do a higher integration with our own technology than having to buy at high price, on having to invest later to transform an old architecture to a new one. My comment could be the same for Aviva which was almost a funny situation that happened last year. And you noticed that we did not even consider this as a credible option, as it correlates to where we see the megatrends. So those are for the two cases that you may have observed. Related to the M&A strategy, we want to get the freedom and we have the freedom to act with the cash capacity. But clearly we're going to continue to take the very same strategy. We don't look for M&A to acquire market share. We look at M&A to acquire scientific technology that fits on knowledgeable teams. Where all this fits clearly in the strategy that we have decided to implement related to what I presented this morning. So those are the criteria and we're going to continue to do the moves that we need to do to fulfill frankly a space that we're inventing because today none of the competitors are doing what we do and in fact the competitive landscape I think is even challenging. So from an M&A standpoint, we want to keep that flexibility. So I cannot say much for on a one-year because your question was bounded to do one-year 2016. But if you take a little bit wider scope of two to three years, we will continue to balance probably well both aspect of organic versus M&A from that standpoint. But this will be the result of moves where we acquire things that we think are valuable for the strategy, I just presented today. So that's -- it's all similar to what we've done in the past well targeted key technology, good team, well located commitment for the long-term and really common view on what we want to do.

May be if you can, on CD-adapco. I think you are in commercial partnership with them, is the move going to change something? And do I get it right that you don't -- you not going to make any M&A in simulation then? Bernard Charlès: Well that's a wrong conclusion to start with the last statement that you did. We've started to invest in bioscience, material science, this is simulation with Accelrys, it goes far beyond additional simulation techniques. So the simulation world is a world that we want to lead. But we don't want to lead for the past. We want to lead for the future and so it's clear that the simulation world for us is an area of further investment. But the scope is much more than traditional metallic environment or traditional environment it's about the future of material science and the future of hybrid simulation. So don't take the conclusion, and take the conclusion that simulation stay and remains a very strategic. But you know we need to know where we spend the money and where we don't spend it to really do these game changer solution we're doing and we demonstrated up to now that we were doing it well. So but it's not the only domain. I told you about the four megatrends, the new world of design is happening, the new world of production is happening, the new world of marketing is happening and we think for the first time our platform can connect those elements. So we're going to continue to expand exactly in the frame that I presented today. So the targets are not the same as they were three years ago.

Yes, good morning gentlemen, thanks for taking my question. I'm Brice Prunas from Exane BNP. My first question relates to your fiscal year '16 margin, where basically a part of the bolted on your name is that you can have significant margin expansion in the absence of acquisitions organically. So this year fiscal year '16 is a year without dilution from this acquisition. And in that figure I'm a bit surprised by the cushion of your margin guidance or point taken on the currency. Thibault, that is probably a bit of your usual cushion also. But maybe we could have expecting more. And my second one relates to long question on simulation. Do you believe today in the marketplace there is a decent target for fluid simulation after the one of Siemens, also one -- of the number one of the market that had already acquired? Do you still have some targets? Bernard Charlès: On the first question I will revert it under operating margin; we don't want to be your prisoner, that's my answer. So we have to invest for the long-term and we have to get the freedom to do what we have to do with our cash and still deliver on the target operating margin. So and as we don't never speak about any moves related to M&A we’re not going to start to do it today. On the second question which is the CFD, you're all assuming that the CFD tomorrow is the same as yesterday. I don't think so and that’s the game we're planning. We are going to transform the CFD world with the new patents we just got and that's a game plan. We bought CADA years ago that was the world leader in drawing. And we were forced to do it because we wanted to keep the exclusivity with IBM. At that time it was a wrong decision, but we had no choice, so we are buying the past just to keep the relationship with IBM. But this time we have more flexibility to not buy the past but that for the future, so for CFD, I'm convinced that we will come with solutions that are so innovative that customers will pick our solutions. But we need a little bit of time to do it. François-José Bordonado: One last question from the room.

Good morning, Gregory Ramirez from Bryan Garnier. I have one question related to your business model the move that you're making on the SOLIDWORKS. This is correctly a model which is essentially based on license, pure license sales. Obviously you increased the maintenance now in the future could it become more recurring. So how do you apprehend this business model change especially with the advent of cloud based solutions. And do you think that beyond 2016 there will be a change in the business model that will have an impact such as some of your competitors in the entry level have that we probably not obliging you to change rapidly the business model to move entirely to subscriptions that's to have a negative impact on your license sales and increasingly moving to subscriptions, so revenue growth could slow down? Bernard Charlès: I'll ask Thibault, this is an important question and I think there are few statements that we need to put in perspective here. As Thibault mentioned, we are doing a quite nice track record increasing the subscription aspect of SOLIDWORKS, and you have seen the track record in the past years. The reason why the subscription -- and we want to continue to do that. The reason why the subscription has been not growing nicely for SOLIDWORKS which was in a market where usually you would buy the license and put on your PC one-time shot, is because we've been providing online services for our users which are so valuable for them and they get those online services when they pay subscription. It's called MYSOLIDWORKS which provide support online, training online, and why have we done those steps because we are preparing exactly what you described in your second part of the question, which is to continue to expand the subscription model with valuable services that our users will want to have and they do want to have them. So the maintenance become absolutely secondary. The value is the new functions you get, the service you have online, and I think in the last three years, the track record is very speaks for itself on that standpoint. So to go to the last part of your question, I think the question you've asked I would like to extend it not only to SOLIDWORKS but to all the type of software we do. Cloud for Dassault Systemes is a huge opportunity to reach clients that we could not reach up to now. The architect, the video that it presented this morning; think about it. This client was a client that was using a software that was costing to buy one-shot $400. This client was using a $400 software per user. This company because of the cloud is moving to CATIA 3DEXPERIENCE, because they don't need now to -- for the CapEx to get access to that service, this real case. So here we are with a company that was using one-time charge $400 license. I will not name the competitor. And we replaced them with the power of 3DEXPERIENCE online on the cloud, where of course over few years the -- we will get the same revenue as for CATIA fully loaded license. So that's what is happening. Many companies that couldn't afford for complexity, administration, management, solutions with the cloud now can have access to it. So we are very careful about making sure that we make this work well for them. And I think 2015 was a key milestone. It does not create as Thibault might have mentioned really visible leverage yet. But I believe that for the future it's a huge opportunity on for us. For me, I don't see any risk beside of accessing to a bigger market. That's in short. And that was well understood for the future of SOLIDWORKS where we want to really adopt different terms and conditions as I presented briefly. We will discuss more of Q1 and Q2 about that with you. We want to provide fully subscription model not only, what we call PLC, primary license charge, and then subscription later. It fits with wherever we want to go and I don't think it will have any destabilization impact and can trust us for that. François-José Bordonado: We'll go -- will give the floor to the conference call and then we'll be back to the room. Elaine, please would you please give the floor to John King.

Please go ahead Mr. King. Your line is open. John King - Bank of America Merrill Lynch: Thanks. I had three questions, if I could. First one, Thibault, as you said there are a lot of concerns about the macro environment, in particular, in some of your core markets. So could you just talk about your visibility for 2016? What gives you the confidence that you think clients will ultimately spend the budgets that they have and leave your guidance intact? Second question, and perhaps this is part of the answer, is the 3DEXPERIENCE, I guess, pipeline, or maybe even before that, could you help me out with the new license growth for 3DEXPERIENCE in Q4 itself? I mean, it looks pretty strong. I think the metrics that you gave in terms of a share of new licenses show a pretty good uptick. So what were you seeing in Q4? And more importantly, what kinds of license growth would you expect from 3DEXPERIENCE, embedded within your double-digit, for 2016? And then, perhaps thirdly, for Bernard, I was interested by the initiative around cities for people. I appreciate at the moment you're focused very much on the macro-city planning view, but I wonder, the long-term, does that include a move more in to the traditional AEC and construction design market as well? Thanks.

Thank you, John. The visibility we have is -- first of all on the macro, Asia, your view that it's going to be more volatile and in fact all in all probably slightly weaker than in 2015. So the confidence we are getting it on two aspects. One is our pipe and we have a visibility over 2016 in it, in the new manner where we're doing it, especially for direct sales and despite supporting the objective. The second factor is the referencing. Bernard mentioned 80 deployments of 3DEXPERIENCE in 2015. These ones are going to bring benefits to this customers and will be visible. It's also the reason why we are investing, because we see this product cycle and we need to be ready for more growth in 2017 and beyond. So I will welcome all questions on the fact that we are only improving operating margin by 50 basis points in 2016. Your question on 3DEXPERIENCE in Q4. Thank you for asking. In fact the growth is so good that I had decided not to put it in the presentation. But if you want to know new licensees for 3DEXPERIENCE, we're up by 64% in Q4. So what we're targeting best on that is that the share of 3DEXPERIENCE in new licensees in 2016 should be over one-third of new licensees. Bernard Charlès: And John, related to the AEC to stay constantly what I said at the beginning of the week in public at the SOLIDWORKS World. Yes, I said clearly that based on the showcase, on the wins we got -- AEC stands for Architecture Engineering Construction by the way. Based on the success with cloud last year we believe that the time has come for us to accelerate the development of this market, not the development of the solution we have I think very credible solution. And we have asked partners to invest with us to make sure they have their competency. And there are some good news, because some of the competitors are laying off so we probably will find good profiles quickly, who are well-trained for the sector. And we are going to take advantage of that. So we are -- I think we are in a position to do I think good things in AEC starting this year. François-José Bordonado: Another question from the conference call, Elaine.

I'm sorry sir. Could you please repeat? François-José Bordonado: Would you please give the floor to Stacy Pollard, please?

Please go ahead Ms. Stacy Pollard of JPMorgan. Your line is open.

Two quick ones. Can you talk -- you discussed the pipeline and your expectations for 2016 as you looked across the macro. Can you discuss, perhaps, any particular industries or products that you see a significant shift as you go -- the difference from 2015 to 2016? And then secondly, can you touch on the competition? You are broadening your scope in a few ways; first of all, diversified industries. So, for example, who is your main competition in life sciences, CPG, and other diversified industries? But then also, you discussed the 3DEXPERIENCE and the strategic applications across this kind of design, science, manufacturing, and marketing. And is your competition shifting or broadening, as we look in to the future, around that?

So Stacey, in the pipe what we see is -- and these are not dramatic changes compared to 2015. But I think that varies a couple of industries where the performance could be better in 2016 compared to '15. One of them is aerospace. We are seeing traction, more traction in aerospace since the middle of 2015. Another one is Industrial Equipment, more reserved, because it's more linked to the macro. But for sure, we have in this field success stories in very, very good deployments that are showing the value. So I would say that marginally this industry should grow faster and finally hi-tech where I also believe that we should see more attraction. Bernard Charlès: Related to the competitive landscape, I think it's very clear that we are taking an approach on a path for future which is very different from all our competitors. It's not the first time we did it three times, every 10 years. We were the first to do the digital mock up in the world and it has created what Dassault Systemes 3D first digital mock up then PLM. We invented a market, created the market, and fulfilled the market. With 3DEXPERIENCE we are doing the same, it's not an extension of what we've been doing; it's a new game plan, so it takes time. I think our biggest challenge is frankly not the competition; it's about showing to the customer what is possible. In life science we have great wins last year with BIOVIA, Amgen being one of them and there are many users. But those customers who were buying the former BIOVIA called Accelrys as a toolkit are now discovering in pharma, in chemistry, and many other sectors they are life science at large they are discovering that they can rethink their innovation platform. That's what we're doing. So I think for us to challenge and I’m not trying to deviate Stacy at all the question. But I think for us the biggest challenge is to elevate the capacity of our partners to know what is possible and showcase with clients and then replicate those industry solutions that is what is happening in AEC, in life science, in EPU, Energy Process Utility sector. But you know that’s the definition of Dassault Systemes is to really be game changer; we don’t take the market the same way as the other. And I believe that if you are interested with our future you should look at us that way, don’t look at us to try to map us to what the user are doing because that’s not whether we on SOLIDWORKS is winning and we’ll accelerate because we’re changing the game planning design, not because we are putting more function in SOLIDWORKS because we are powering SOLIDWORKS with this 3DEXPERIENCE platform. So yes, we would probably find more niche players as competitors. But I think what slowed down the Dassault Systemes growth today is demonstrating what is possible to those industries and then building the credibility effects so we can accelerate application. And that’s why we need to continue to invest and I think 31% is very reasonable and we are long-term, so we need to invest on the right thing. François-José Bordonado: We will take one last question from the call and then we’ll be back to the room, Elaine?

Our next question comes from Charles Brennan of Credit Suisse. Please go ahead.

I've got two if that is possible. The first one is just to come back on your comments Thibault you’re investing in 2016 to support revenue growth in 2017. What's the right way to think about the scale of the payback on the investments? Do you think you need that investment just to sustain 6% to 7% growth or should we be naturally expecting growth to accelerate in 2017? And then the second question is just on SOLIDWORKS, it seems like units revenue growth has been pretty modest since the second quarter. I think it even set negative in the fourth quarter. How should we think about the balance between unit growth and price growth for 2016? Thanks.

Thank you for the questions, Charles. I think the well to be very clear, yes, of course we are investing because we believe that growth can accelerate in 2017 and beyond and that's actually very consistent with our five-year plan. You know that we are certainly very committed to deliver against our five-year plan. And so you will see that we have the product cycle engineered in the five-year plan and therefore the acceleration of revenue that we have always by the way seen in the past with such a product cycle. So we need to prepare for this growth acceleration, you're absolutely right about that. SOLIDWORKS units' two remarks on that front. You will probably remember that a few years ago we stepped this closing CATIA unit. I’m not making any announcement here by the way. But we did so because units were not representing anymore the true dynamic of CATIA because of the fact that CATIA was made of 180 different products and of course the only counter unit when you sell huge license, but all the rest of the business was not well recognized by the number of units. SOLIDWORKS is becoming multiproduct. This channel professional channel is now selling data management it is selling structural analysis, it is setting plastic intrusion, it is setting electrical wiring. So the enrichment of these products is the reason why SOLIDWORKS revenue is up in a nice fashion and units are becoming little bit less relevant, because when the channel is setting these more sophisticated advanced products of course these resources are busy at it and sell less basic licenses. However I'm confident that we will see a good traction going forward for SOLIDWORKS. As Bernard mentioned, we’re doing things which are going to be very relevant for this market. And so I also believe units should go up. But bear in mind that we are not just setting basic SOLIDWORKS licenses anymore in this channel.

Okay. François-José Bordonado: Another question from the room oh sorry, sorry Charles.

Can I just come back on the first part of the question, in previous product cycles; we've seen you delivering double-digit revenue growth. Do you think that sort of growth is achievable for 2017 or is that still a stretched target for you?

I think at this point, I’m not giving guidance for 2017 yet. But I’m ready to take a bet with you that there will be an acceleration in '17 and when appropriate we will come back with more guidance. François-José Bordonado: With this, we move to the room [indiscernible]. Q – Unidentified Analyst: Hi hello last year you had some headwind from recurring revenue in the renting from other customers. How do you plan to -- how do you see this business this year? And on the maintenance, and more generally on the recurring revenue side, you've been growing license faster than this line for several quarter now. When do you expect both to converge on the upper side for the maintenance, for recurring revenue in general?

So the headwinds are still there for the first half of 2016. But in terms of rentals with this kind of customers it's part of our expectations that we would not have headwinds anymore in the second half. And we would start to see some acceleration in aerospace to be confirmed. But I think this will happen in that manner. The convergence between new license growth and recurring is very interesting topic. And it takes time, as you know, I had done the model of that and I'm afraid that the complete convergence was only achieved after seven years. However it is true that that of course continuing to have double-digit new license growth is going to bring benefits on the recurring that for sure. And they should start to be much more visible actually in 2017.

Good morning. Derric Marcon, Societe Generale. I've got just two questions. First one, can you give us the year-over-year growth of acceleration in Q4? Now, I've got three, by the way. My second question is about the services, expected revenue growth from services in 2016. Would it be fair to say that it would be rather in line with 2015? And how, in that case, if I'm right, Quintiq, Accelrys, and the other recent acquisition you made will contribute to this growth, because services now is partly driven by the performance of this company. And my last question is about the embedded growth of the cost base for 2016. Could you help us to calculate that, please? Thank you. Bernard Charlès: So Derric, good questions. However Accelrys is now renamed BIOVIA, you should know about it. And I'm sorry but we're not breaking down each single brand because we have 12 and so that's difficult as an amount of data to release every quarter. Services for 2016, you're absolutely right. Our expectation is relatively flat services revenue growth in 2016. We have a few brands delivering growth in services and you're right about Quintiq. But we're also continuing our strategy of going to integrate those and supporting integrate those in order to be able to face the number of deployments we have had to do in 3DEXPERIENCE. The last question you asked I'm not sure the embedded what growth of expenses is that the question.

Exactly. The cost base if you go through 1st January how much your cost price -- cost base will grow this year. Bernard Charlès: It depends on whether you include salary raises or not that we'll do this year. But if you include them it's a 4% increase. If you don't it's slightly less. François-José Bordonado: Okay. So thank you very much for being with us this morning and of course we continue to be there to address any specific questions. Have a great day.