EANS-Adhoc: Software AG - The Integration and Process Software Business (BPE) Continues to Grow in Q3 2011
-------------------------------------------------------------------------------- ad-hoc disclosure pursuant to section 15 of the WpHG transmitted by euro adhoc with the aim of a Europe-wide distribution. The issuer is solely responsible for the content of this announcement. -------------------------------------------------------------------------------- quarterly report 18.10.2011 BPE license sales grew by 33 percent in Q3, 2011 (37 percent at constant currency) BPE product sales were up by 17 percent (21 percent at constant currency) Earnings turnaround in the IDS Scheer Consulting division Full-year forecast: Product revenue and earnings growth confirmed Darmstadt, October 18, 2011 - After an initial consolidation of the financial results for the third quarter 2011, Software AG (Frankfurt TecDAX: SOW) accounted for license growth in Business Process Excellence (BPE) of 37 percent (at constant currency) to EUR42 million (previous year EUR 31.4 million). Growth in the product business (license and maintenance) was 21 percent, at constant currency rates, amounting to EUR84 million (previous year EUR72.1 million). The largest increases in sales were reported in North America, Germany, Australia and South Africa. Sales of software licenses across all business areas improved by 7 percent to EUR75 million (previous year EUR69.6 million) or 11 percent at constant currency. The strong growth in BPE license revenue more than offsets the expected decline to EUR32 million (previous year EUR36.6 million) in Enterprise Transaction Systems (ETS) sales. With total maintenance revenues stable, Group product revenue (licenses and maintenance) increased to EUR169 million (previous year EUR166.2 million), an increase of 5 percent at constant currency. Software AG generated services revenues of EUR105 million (previous year EUR108.3 million) in the third quarter. Of this total, EUR63 million (previous year EUR60.5 million) were generated in the BPE and ETS services area and EUR43 million (previous year EUR47.8 million) by IDS Scheer Consulting (IDS). Software AG´s new services management team is focused on increasing profitability accepting slower revenue growth during this transition phase. Total Group turnover was EUR275 million (previous year EUR275.3 million), an increase of around 2 percent at constant currency rates. The continuing strength of the Euro in the third quarter resulted in lower stated revenues of approx. EUR7 million as foreign currency sales are converted into Euro. Through a stronger focus on profitability in the services business, IDS Scheer Consulting successfully managed a turnaround in earnings in the third quarter and will significantly increase its contribution to results in the second half of the year. Overall in the third quarter, the Software AG group achieved an operating profit (EBIT) of approx. EUR71 to EUR73 million (previous year EUR69.1 million). Software AG considers itself to be well on the way to achieving its full year growth targets in its core business, the sale of software licenses and maintenance. The ETS product revenue for the first nine months is 1 percent under the 2010 year level. This performance confirms the forecast for the full year 2011 of ETS product revenue within plus or minus 2 percent of the 2010 level. After nine months the BPE business division has delivered 10 percent revenue growth at constant currency rates. There is strong customer interest in integration and process software and this will continue to generate double digit growth, despite the macro-economic uncertainties. Therefore, the company confirms its product revenue growth target for 2011 of 10 to 15 percent at constant currency. In the IDS Scheer Consulting business division the company will remain focused on profitable projects. For the full fiscal year, this will have two consequences: first an expected increase in the EBIT margin of around 200 basis points to approx. 26 percent (previous year 24.0%); and second a total Group revenue growth of between 2 to 5 percent at constant currency. The profit after tax will therefore be 10 to 15 percent over the EUR175.6 million reported in 2010. The detailed financial results will be published by Software AG on October 27, 2011. Further inquiry note: Robert Adolph Manager Investor Relations Tel.: +49 (6151) 92 1237 E-Mail: robert.adolph@softwareag.com end of announcement euro adhoc -------------------------------------------------------------------------------- issuer: Software AG Uhlandstr. 12 D-64297 Darmstadt phone: +49 (0)6151 92 1899 FAX: +49 (0) 6151 92 1933 mail: investor.relations@softwareag.com WWW: http://www.softwareag.com sector: Software ISIN: DE0003304002 indexes: TecDAX, CDAX, HDAX, Prime All Share, Technology All Share stockmarkets: regulated dealing/prime standard: Frankfurt, free trade: Berlin, Hamburg, Stuttgart, Düsseldorf, Hannover language: English
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