AVEVA has a consistent track record of growing revenues and profits over the long term. We provide mission-critical solutions to some of the world’s biggest engineering contractors (EPCs) and Owner Operators. Demand in our end markets is driven by long term global trends, such as the growing global demand for Oil & Gas and the steadily increasing consumption of energy. AVEVA has successfully established a truly global infrastructure and is exposed to the world’s fastest growing economies. AVEVA is a technology leader within these markets.
World beating technology
AVEVA’s world-leading technology was originally developed and spun out of Cambridge University in 1967. In 1976, AVEVA introduced the world’s first 3D plant design system (PDMS) with an object-based engineering database. Innovation remains the lifeblood of the Company; during the course of the last five years alone, AVEVA has invested close to £150 million in Research & Development.
Growth track record
AVEVA is recognised as one of the world’s leading engineering, design and information management software providers to the process, plant and marine industries. Celebrating our 45th anniversary in 2012, we have achieved our long term success by working in close partnership with leading engineering companies to deliver continual and visionary innovation.
AVEVA’s products are most applicable in industries where scale and complexity are greatest. As a result, the principle driver of growth has been in the Oil & Gas industry, but with the recent global downturn in Oil & Gas, the focus has started to shift into other market sectors. AVEVA also has a strong position in the global Power market. The Marine industry is also traditionally a key area of strength, although that industry is currently experiencing a cyclical downturn, offset partly by offshore projects. AVEVA also sells into new growth markets and other related industries, for example Food & Beverage, Chemicals, Pharmaceuticals, Metals & Mining and Pulp & Paper.
Delivering value to our customers
Across these end markets, global EPCs, Owner Operators and shipbuilders trust AVEVA to help them create and operate the world’s most complex assets. More than 3,500 customers use AVEVA’s software solutions, which empower them to make thousands of accurate and timely design, engineering and business decisions, across the entire project and asset lifecycle – improving productivity, minimising risk and reducing costs.
Strong financial model
AVEVA licenses its software either through an upfront license and an associated annual fee, or via a rental contract. Hence AVEVA’s revenue has a high proportion of annually recurring fees, which currently stands at around 75% of total Group revenue. Approximately 90% of AVEVA’s revenue derives from software, leading to high profit margins of around 30-35%. This in turn translates into strong cash generation; typically AVEVA’s operating cash conversion is 100% and the balance sheet is consequently robust.
Regionally, AVEVA’s business is broadly spread – selling into all major territories around the world. One of AVEVA’s core strengths lies in being close to the customer and we now have offices in 30 countries, offering local support wherever our customers operate. We are seeing rapid expansion in the world’s fastest growing economies, particularly in India and China.