2014

SAP Announces Record Third-Quarter Results, Exceeds Euro 1 Billion In Third-Quarter Software Revenue

WALLDORF, Germany, Oct. 24, 2012 /PRNewswire/ --

  • Third-Quarter 2012 Software Revenue Increased 17% to €1,026 Million (12% at Constant Currencies)
  • Third-Quarter 2012 Non-IFRS Software and Software-Related Service Revenue Increased 19% to €3.21 Billion (13% at Constant Currencies)
  • Triple-Digit Growth in Key Innovation Areas: Cloud, SAP HANA, Mobile
  • Third-Quarter 2012 Non-IFRS Operating Profit Increased 10% to €1.24 Billion (4% at Constant Currencies)
  • Year-over-Year Comparison of 2012 Third-Quarter IFRS Operating Profit and Operating Margin Impacted by Profit in Q3 2011 of €723 Million From the Reduction in the TomorrowNow Litigation Provision
  • SAP Refines Full-Year Revenue Guidance and Includes the Expected Results of Ariba

SAP AG (NYSE: SAP) today announced its financial results for the third-quarter ended September 30, 2012.

(Logo:  http://photos.prnewswire.com/prnh/20110126/AQ34470LOGO)

BUSINESS HIGHLIGHTS IN THE THIRD-QUARTER

SAP delivered double-digit growth in the third-quarter. SAP had a strong performance in the Americas and solid double digit growth in APJ. SAP performed well in EMEA compared to the tremendous performance in EMEA last year. Demand for SAP's new innovation categories continued across all regions. SAP HANA revenue was €83 million, putting the company on track to meet full-year expectations of at least €320 million. Mobile revenue was €48 million which keeps SAP on track to meet full-year expectations of €220 million. SAP's cloud momentum continued in the third-quarter: 12 months new and upsell subscription billings increased fourteenfold. Even when including SuccessFactors in SAP's 2011 numbers the growth is triple digit at 116%[1]. For SuccessFactors on a stand-alone basis, 12 month new and upsell subscription billings grew 92%. Non-IFRS cloud subscription and support revenue increased twentyfold to €80 million. SAP's core business also saw solid growth. Key industries such as retail, health sciences, manufacturing and energy as well as continued expansion of sales through SAP partners also contributed to the third-quarter results.

"Our innovation strategy continues to deliver world-class value and market leading performance," said Bill McDermott and Jim Hagemann Snabe, Co-CEOs. "With SAP, businesses are innovating, achieving operational excellence and driving growth. We are proud of our relentless customer focus and confident that we'll continue to outperform the competition."

"I am pleased with SAP's overall performance in the third-quarter. This is the 11th consecutive quarter of double-digit non-IFRS software and software related service revenue growth for SAP," said Werner Brandt, CFO. "We continued to invest in our cloud business in the third-quarter. We remain focused on operating discipline and remain confident in our full-year outlook."

 

FINANCIAL RESULTS IN DETAIL


FINANCIAL HIGHLIGHTS – Third-Quarter 2012



Third-Quarter 20121)


IFRS



Non-IFRS2)




€ million, unless otherwise stated

Q3 2012

Q3 2011

% change

Q3 2012

Q3 2011

% change

% change

 const. curr.









Software

1,026

875

17

1,026

875

17

12

Support

2,105

1,812

16

2,106

1,813

16

10

Cloud subscriptions and support

63

4

1,475

80

4

1,900

1,700

Software and software-related service revenue

3,194

2,691

19

3,212

2,692

19

13

Total revenue

3,952

3,409

16

3,970

3,410

16

10

Total operating expenses

−3,031

−1,650

84

−2,731

−2,279

20

14

- thereof TomorrowNow litigation

−7

723

<-100

N/A

N/A

N/A

N/A

Operating profit

921

1,759

−48

1,239

1,131

10

4

Operating margin (%)

23.3

51.6

−28.3pp

31.2

33.2

−2.0pp

−2.1pp

Profit after tax

618

1,251

−51

836

860

−3


Basic earnings per share (€)

0.52

1.05

−50

0.70

0.72

−3


Number of employees (FTE)

61,344

54,589

12

N/A

N/A

N/A

N/A


1) All figures are unaudited.

2) For a detailed description of SAP's non-IFRS measures see Explanation of Non-IFRS Measures online. For a breakdown of the individual adjustments see page F8 in the appendix to this press release.

IFRS software revenue was €1,026 million (2011: €875 million), an increase of 17% (12% at constant currencies). IFRS software and software-related service revenue was €3.19 billion (2011: €2.69 billion), an increase of 19%. Non-IFRS software and software-related service revenue was €3.21 billion (2011: €2.69 billion), an increase of 19% (13% at constant currencies). IFRS total revenue was €3.95 billion (2011: €3.41 billion), an increase of 16%. Non-IFRS total revenue was €3.97 billion (2011: €3.41 billion), an increase of 16% (10% at constant currencies).

In the third-quarter of 2011, the reduction of the provision for the TomorrowNow litigation resulted in a significant profit from our discontinued TomorrowNow activities. This had a 21.2 percentage point positive influence on our third-quarter 2011 IFRS operating margin. For this reason the 2012 and 2011 IFRS profit and margin numbers are not fully comparable.

IFRS operating profit was €921 million (2011: €1.76 billion), a decrease of 48%. Non-IFRS operating profit was €1.24 billion (2011: €1.13 billion), an increase of 10% (4% at constant currencies). IFRS operating margin was 23.3% (2011: 51.6%), a decrease of 28.3 percentage points. Non-IFRS operating margin was 31.2% (2011: 33.2%), or 31.1% at constant currencies, a decrease of 2.0 percentage points (a decrease of 2.1 percentage points at constant currencies).

Non-IFRS operating profit and non-IFRS operating margin for the third-quarter 2012 were impacted by the acquisition of SuccessFactors, which impacted the non-IFRS operating margin by approximately 100 basis points. In addition, headcount grew by almost 6,800 FTE's year over year, thereof 2,300 FTE's from acquisitions.

IFRS profit after tax was €618 million (2011: €1.25 billion), a decrease of 51%. Non-IFRS profit after tax was €836 million (2011: €860 million), a decrease of 3%. IFRS basic earnings per share was €0.52 (2011: €1.05), a decrease of 50%. Non-IFRS basic earnings per share was €0.70 (2011: €0.72), a decrease of 3%. The IFRS and non-IFRS effective tax rates in the third-quarter of 2012 were 24.8% (2011: 28.7%) and 26.7% (2011: 23.3%), respectively. Third-quarter profit after tax and EPS were negatively impacted by a €64 million or €0.05 per share expense related to the currency hedging of the purchase price for the recently closed Ariba acquisition.

 

FINANCIAL HIGHLIGHTS – Nine Months 2012



Nine Months 20121)


IFRS

Non-IFRS2)

€ million, unless otherwise stated

9M 2012

9M 2011

% change

9M 2012

9M 2011

% change

% change

const. curr.









Software

2,722

2,328

17

2,722

2,328

17

12

Support

6,071

5,257

15

6,075

5,283

15

10

Cloud subscriptions and support

144

12

1,100

183

12

1,425

1,300

Software and software-related service revenue

8,937

7,597

18

8,980

7,623

18

13

Total revenue

11,200

9,733

15

11,243

9,759

15

10

Total operating expenses

−8,727

−6,520

34

−7,998

−6,830

17

13

- thereof TomorrowNow litigation

−1

711

<-100

N/A

N/A

N/A

N/A

Operating profit

2,473

3,213

−23

3,245

2,929

11

5

Operating margin (%)

22.1

33.0

−10.9pp

28.9

30.0

−1.1pp

−1.4pp

Profit after tax

1,723

2,242

−23

2,249

2,091

8


Basic earnings per share (€)

1.45

1.88

−23

1.89

1.76

8


Number of employees (FTE)

61,344

54,589

12

N/A

N/A

N/A

N/A


1) All figures are unaudited.

2) For a detailed description of SAP's non-IFRS measures see Explanation of Non-IFRS Measures online. For a breakdown of the individual adjustments see page F8 in the appendix to this press release.

IFRS software revenue was €2.72 billion (2011: €2.33 billion), an increase of 17% (12% at constant currencies). IFRS software and software-related service revenue was €8.94 billion (2011: €7.60 billion), an increase of 18%. Non-IFRS software and software-related service revenue was €8.98 billion (2011: €7.62 billion), an increase of 18% (13% at constant currencies). IFRS total revenue was €11.20 billion (2011: €9.73 billion), an increase of 15%. Non-IFRS total revenue was €11.24 billion (2011: €9.76 billion), an increase of 15% (10% at constant currencies).

For the first nine months ended September 30, 2011, the reduction of the provision for the TomorrowNow litigation resulted in a significant profit from our discontinued TomorrowNow activities. This had a 7.3 percentage point positive influence on our nine months ended September 30, 2011 IFRS operating margin. For this reason the 2012 and 2011 IFRS profit and margin numbers are not fully comparable.

IFRS operating profit was €2.47 billion (2011: €3.21 billion), a decrease of 23%. Non-IFRS operating profit was €3.25 billion (2011: €2.93 billion), an increase of 11% (5% at constant currencies). IFRS operating margin was 22.1% (2011: 33.0%), a decrease of 10.9 percentage points. Non-IFRS operating margin was 28.9% (2011: 30.0%), or 28.6% at constant currencies, a decrease of 1.1 percentage points (a decrease of 1.4 percentage points at constant currencies).

IFRS profit after tax was €1.72 billion (2011: €2.24 million), a decrease of 23%. Non-IFRS profit after tax was €2.25 billion (2011: €2.09 billion), an increase of 8%. IFRS basic earnings per share was €1.45 (2011: €1.88), a decrease of 23%. Non-IFRS basic earnings per share was €1.89 (2011: €1.76), an increase of 8%. The IFRS and non-IFRS effective tax rates in the first nine months of 2012 were 24.9% (2011: 28.7%) and 26.7% (2011:26.7%), respectively.

Operating cash flow was €3.06 billion (2011: €2.97 billion), an increase of 3%. Free cash flow was €2.69 billion (2011: €2.64 billion), an increase of 2%. Free cash flow was 24% of total revenue (2011: 27%). At September 30, 2012, SAP had a total group liquidity of €3.93 billion (December 31, 2011: €5.60 billion), which includes cash and cash equivalents and short term investments. Net liquidity at September 30, 2012 was €278 million compared to €1.64 billion at December 31, 2011. This decrease in net liquidity was primarily the result of the annual shareholder dividend payment and the acquisition of SuccessFactors in the first nine months of 2012.

CHANGE IN SEGMENT REPORTING

Following its increased focus on the cloud business, in the third-quarter 2012 SAP changed both the structure of the components that the SAP management uses to make decisions about operating matters and the main profit measure used for the purposes of allocating resources to these components and measuring their performance. SAP now has two divisions – 'On Premise' and 'Cloud' which are further divided into operating segments. The On Premise division is comprised of two operating segments: 'On Premise Products' and 'On Premise Services'. In the third-quarter 2012, SAP's Cloud division was comprised of one operating segment: 'Cloud Applications'. Following the acquisition of Ariba SAP intends to establish a second operating segment in the Cloud Division, mainly consisting of the acquired Ariba business. Please see link to a Webinar at SAP's webpage for more information.

BUSINESS OUTLOOK

The Company is providing the following outlook for the full-year 2012, which has changed from the previous outlook provided on July 24, 2012. The Company has refined the outlook for non-IFRS software and software-related service revenue at constant currencies and has included Ariba's expected revenue and profit contribution from the acquisition date (October 1, 2012) to year end:

  • Including Ariba, the Company now expects full-year 2012 non-IFRS software and software-related service revenue to increase in a range of 10.5% – 12.5% at constant currencies (2011: €11.35 billion). This includes a combined contribution of approximately 2.5 percentage points from SuccessFactors and Ariba. The respective outlook provided in July which did not yet consider Ariba, was 10.0% – 12.0%.
  • Assuming that the macroeconomic environment does not deteriorate the Company expects to reach the upper end of the 10.5% - 12.5% non-IFRS software and software-related service revenue growth range (at constant currencies).
  • The Company continues to expect full-year 2012 non-IFRS operating profit to be in a range of €5.05 billion – €5.25 billion at constant currencies (2011: €4.71 billion). Full-year 2012 non-IFRS operating profit excluding SuccessFactors and Ariba is expected to be in a similar range. The outlook is unchanged from the outlook given in July.
  • The Company still projects a full-year 2012 IFRS effective tax rate of 26.5% – 27.5% (2011: 27.9%) and a non-IFRS effective tax rate of 27.0% – 28.0% (2011: 26.6%). The outlook is unchanged from the outlook given in July.

Additional Information

As of February 21, 2012 revenue, profit and cash flow figures include the revenue, profits and cash flows from SuccessFactors. For the prior-year period those numbers were not included. These results do not include any impact from the Ariba acquisition which closed on October 1, 2012.

TomorrowNow litigation update: Oracle, after the trial judge issued an order on  September 1, 2011, filed a motion seeking an early appeal from the ruling vacating the jury's damages award, which was denied by the judge. Consequently, Oracle elected to proceed with a new trial. In lieu of a new trial, the parties stipulated to a judgment in the amount of $306 million, while each preserving all rights for appeal. SAP remains determined to work through the legal process to bring this case to resolution.  Please see SAP's third-quarter 2012 interim report for more details.

We have updated our non-IFRS estimates for the full-year 2012. For the updated estimates please see SAP's third-quarter 2012 interim report. For a more detailed description of all of SAP's non-IFRS measures and their limitations as well as our constant currency and free cash flow figures see Explanation of Non-IFRS Measures online.

Third-Quarter 2012 Interim Report

SAP's Third-Quarter 2012 Interim Report was published today and is available for download at www.sap.com/investor. The interim report includes an update on SAP's sustainability performance.

Webcast

SAP senior management will host a conference call for financial analysts and investors on Wednesday, October 24th at 2:00 PM (CET) / 1:00 PM (GMT) / 8:00 AM (EDT) / 5:00 AM (PDT). The conference call will be web cast live on the Company's website at www.sap.com/investor and will be available for replay.

[1] This growth rate is a pro forma growth rate assuming that the acquisition of SuccessFactors was completed as of January 1, 2011.

About SAP

As market leader in enterprise application software, SAP (NYSE: SAP) helps companies of all sizes and industries run better. From back office to boardroom, warehouse to storefront, desktop to mobile device – SAP empowers people and organizations to work together more efficiently and use business insight more effectively to stay ahead of the competition. SAP applications and services enable more than 197,000 customers to operate profitably, adapt continuously, and grow sustainably. For more information, visit www.sap.com.

Any statements contained in this document that are not historical facts are forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Words such as "anticipate," "believe," "estimate," "expect," "forecast," "intend," "may," "plan," "project," "predict," "should" and "will" and similar expressions as they relate to SAP are intended to identify such forward-looking statements. SAP undertakes no obligation to publicly update or revise any forward-looking statements. All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from expectations. The factors that could affect SAP's future financial results are discussed more fully in SAP's filings with the U.S. Securities and Exchange Commission ("SEC"), including SAP's most recent Annual Report on Form 20-F filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates.

© 2012 SAP AG.  All rights reserved.

No part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of SAP AG.  The information contained herein may be changed without prior notice.

Some software products marketed by SAP AG and its distributors contain proprietary software components of other software vendors. National product specifications may vary.

These materials are provided by SAP AG and its affiliated companies ("SAP Group") for informational purposes only, without representation or warranty of any kind, and SAP Group shall not be liable for errors or omissions with respect to the materials.  The only warranties for SAP Group products and services are those that are set forth in the express warranty statements accompanying such products and services, if any.  Nothing herein should be construed as constituting an additional warranty.

SAP and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP AG in Germany and other countries.  Please see http://www.sap.com/corporate-en/legal/copyright/index.epx#trademark for additional trademark information and notices.

Note to editors:

To preview and download broadcast-standard stock footage and press photos digitally, please visit www.sap.com/photos. On this platform, you can find high resolution material for your media channels. To view video stories on diverse topics, visit www.sap-tv.com. From this site, you can embed videos into your own Web pages, share video via e-mail links and subscribe to RSS feeds from SAP TV.

For customers interested in learning more about SAP products:

Global Customer Center:      

+49 180 534-34-24

United States Only:          

1 (800) 872-1SAP (1-800-872-1727)


For more information, press only:

Christoph Liedtke             

+49 (6227) 7-50383    

christoph.liedtke@sap.com, CET

Daniel Reinhardt              

+49 (6227) 7-40201   

daniel.reinhardt@sap.com, CET

Hubertus Kuelps              

+49 (6227) 7-40011   

hubertus.kuelps@sap.com, CET

Jim Dever                        

+1 (610) 661-2161   

james.dever@sap.com, ET

Claudia Cortes                

+65 6664-4450       

claudia.cortes@sap.com, SGT (GMT +8)


For more information, financial community only:

Stefan Gruber      

+49 (6227) 7-44872    

investor@sap.com, CET




Follow SAP Investor Relations on Twitter at @sapinvestor.

 

 

Appendix – Financial Information to Follow

 

FINANCIAL INFORMATION

FOR THE THIRD-QUARTER 2012

(Condensed and Unaudited)






Page




Financial Statements (IFRS)  



 Income Statements - Quarter          

F1


 Income Statements – Nine Months  

F2


 Statements of Financial Position       

F3-F4


 Statements of Cash Flows                                

F5




Supplementary Financial Information



Reconciliations from Non-IFRS Numbers to IFRS Numbers

F6-F7


Non-IFRS Adjustments        

F8


Revenue by Region          

F9-F10

 

 

Financial Statements (IFRS)


Consolidated Income Statements

For the three months ended September 30


€ millions, unless otherwise stated

2012

2011

Change

in %

Software

1,026

875

17

Support

2,105

1,812

16

Cloud subscriptions and support

63

4

1,475

Software and software-related service revenue

3,194

2,691

19

Consulting

616

578

7

Other services

142

140

1

Professional services and other service revenue

758

718

6

Total revenue

3,952

3,409

16





Cost of software and software-related services

−638

−513

24

Cost of professional services and other services

−619

−537

15

Total cost of revenue

−1,257

−1,050

20

Gross profit

2,695

2,359

14

Research and development

−547

−436

25

Sales and marketing

−984

−721

36

General and administration

−232

−168

38

Restructuring

−4

−1

>100

TomorrowNow litigation

−7

723

<-100

Other operating income/expense, net

0

3

−100

Total operating expenses

−3,031

−1,650

84

Operating profit

921

1,759

−48





Other non-operating income/expense, net

−92

0

N/A

Finance income

34

29

17

Finance Cost TomorrowNow litigation

0

7

−100

Other finance costs

−41

−38

8

Finance costs

−41

−31

32

Financial income, net

−7

−2

>100

Profit before tax

822

1,757

−53





Income tax TomorrowNow litigation

2

−276

<-100

Other income tax expense

−206

−229

−10

Income tax expense

−204

−505

−60

Profit after tax

618

1,251

−51

Profit attributable to non-controlling interests

0

0

0

Profit attributable to owners of parent

618

1,251

−51





Basic earnings per share, in €*

0.52

1.05

−50

Diluted earnings per share, in €*

0.52

1.05

−50


* For the three months ended September 30, 2012 and 2011, the weighted average number of shares was 1,192 million (diluted 1,193 million) and 1,190 million (diluted: 1,190 million), respectively (treasury stock excluded).


F1

 

 

 

Consolidated Income Statements




For the nine months ended September 30








€ millions, unless otherwise stated

2012

2011

Change

in %

Software

2,722

2,328

17

Support

6,071

5,257

15

Cloud subscriptions and support

144

12

1,100

Software and software-related service revenue

8,937

7,597

18

Consulting

1,830

1,726

6

Other services

433

410

6

Professional services and other service revenue

2,263

2,136

6

Total revenue

11,200

9,733

15





Cost of software and software-related services

−1,743

−1,503

16

Cost of professional services and other services

−1,888

−1,672

13

Total cost of revenue

−3,631

−3,175

14

Gross profit

7,569

6,558

15

Research and development

−1,638

−1,402

17

Sales and marketing

−2,786

−2,140

30

General and administration

−664

−515

29

Restructuring

−8

−2

>100

TomorrowNow litigation

−1

711

<-100

Other operating income/expense, net

1

3

−67

Total operating expenses

−8,727

−6,520

34

Operating profit

2,473

3,213

−23





Other non-operating income/expense, net

−145

−34

>100

Finance income

86

78

10

Finance costs TomorrowNow litigation

−1

7

<-100

Other finance costs

−118

−119

−1

Finance costs

−119

−112

6

Financial income, net

−33

−34

−3

Profit before tax

2,295

3,145

−27





Income tax TomorrowNow litigation

1

−276

<-100

Other income tax expense

−573

−626

−8

Income tax expense

−572

−902

−37

Profit after tax

1,723

2,242

−23

Profit attributable to non-controlling interests

0

1

−100

Profit attributable to owners of parent

1,723

2,241

−23





Basic earnings per share, in €*

1.45

1.88

−23

Diluted earnings per share, in €*

1.45

1.88

−23


* For the nine months ended September 30, 2012 and 2011, the weighted average number of shares was 1,191 million (diluted 1,192 million) and 1,189 million (diluted: 1,190 million), respectively (treasury stock excluded).


Due to rounding, numbers may not add up precisely.


F2

 

 

 

Consolidated Statements of Financial Position

As at September 30, 2012, and December 31, 2011


€ millions

2012

2011

Cash and cash equivalents

3,926

4,965

Other financial assets

181

817

Trade and other receivables

2,962

3,493

Other non-financial assets

354

187

Tax assets

233

207

Total current assets

7,656

9,669




Goodwill

11,015

8,711

Intangible assets

2,527

2,024

Property, plant, and equipment

1,632

1,551

Other financial assets

596

538

Trade and other receivables

88

84

Other non-financial assets

53

39

Tax assets

165

146

Deferred tax assets

600

465

Total non-current assets

16,676

13,558

Total assets

24,332

23,227






F3







€ millions

2012

2011

Trade and other payables

835

937

Tax liabilities

417

409

Financial liabilities

1,808

1,331

Other non-financial liabilities

1,480

1,981

Provision TomorrowNow litigation

240

231

Other provisions

591

331

Provisions

831

562

Deferred income

2,032

1,046

Total current liabilities

7,403

6,266




Trade and other payables

52

43

Tax liabilities

425

408

Financial liabilities

2,119

2,925

Other non-financial liabilities

102

92

Provisions

312

268

Deferred tax liabilities

561

474

Deferred income

49

44

Total non-current liabilities

3,620

4,254

Total liabilities

11,023

10,520




Issued capital

1,228

1,228

Share premium

471

419

Retained earnings

12,880

12,466

Other components of equity

61

−37

Treasury shares

−1,340

−1,377

Equity attributable to owners of parent

13,300

12,699




Non-controlling interests

9

8

Total equity

13,309

12,707

Equity and liabilities

24,332

23,227




F4

 

 

 


Consolidated Statements of Cash Flows

For the nine months ended September 30


€ millions

2012

2011

Profit after tax

1,723

2,242

Adjustments to reconcile profit after taxes to net cash provided by operating activities:



Depreciation and amortization

622

536

Income tax expense

572

902

Financial income, net

33

34

Decrease/increase in sales and bad debt allowances on trade receivables

18

0

Other adjustments for non-cash items

28

32

Decrease/increase in trade receivables

588

473

Decrease/increase in other assets

−109

−58

Decrease/increase in trade payables, provisions and other liabilities

−345

−1,184

Decrease/increase in deferred income

820

667

Cash outflows due to TomorrowNow litigation

−8

−32

Interest paid

−135

−109

Interest received

67

65

Income taxes paid, net of refunds

−817

−602

Net cash flows from operating activities

3,057

2,966




Business combinations, net of cash and cash equivalents acquired

−2,731

−66

Cash payments for derivative instruments related to business combinations

−26

0

Total cash outflows for  business combinations, net of cash and cash equivalents acquired

−2,757

−66

Purchase of intangible assets and property, plant, and equipment

−370

−329

Proceeds from sales of intangible assets or property, plant, and equipment

30

26

Purchase of equity or debt instruments of other entities

−905

−1,560

Proceeds from sales of equity or debt instruments of other entities

1,517

518

Net cash flows from investing activities

−2,485

−1,411




Purchase of non-controlling interests

0

−24

Dividends paid

−1,310

−713

Purchase of treasury shares

−53

−158

Proceeds from reissuance of treasury shares

83

170

Proceeds from issuing shares (share-based compensation)

15

34

Proceeds from borrowings

1,000

519

Repayments of borrowings

−1,313

−1,005

Net cash flows from financing activities

−1,578

−1,177




Effect of foreign exchange rates on cash and cash equivalents

−33

15

Net decrease/increase in cash and cash equivalents

−1,039

393

Cash and cash equivalents at the beginning of the period

4,965

3,518

Cash and cash equivalents at the end of the period

3,926

3,911




F5

 

 

 

SUPPLEMENTARY FINANCIAL INFORMATION

(UNAUDITED)


RECONCILIATION FROM NON-IFRS NUMBERS TO IFRS NUMBERS

The following tables present a reconciliation from our non-IFRS numbers (including our non-IFRS at constant currency numbers) to the respective most comparable IFRS numbers. Note: Our non-IFRS numbers are not prepared under a comprehensive set of accounting rules or principles.



for the three months ended  September 30

€ millions, unless otherwise stated

2012

2011

Change in %


IFRS

Adj.*

Non-

IFRS*

Currency

impact**

Non-IFRS

constant

currency**

IFRS

Adj.*

Non-

IFRS*

IFRS

Non-IFRS*

Non-IFRS

constant

currency**

Revenue Numbers












Software

1,026

0

1,026

−45

981

875

0

875

17

17

12

Support

2,105

1

2,106

−108

1,998

1,812

1

1,813

16

16

10

Cloud subscriptions and support

63

17

80

−8

72

4

0

4

1,475

1,900

1,700

Software and software-related service

revenue

3,194

18

3,212

−161

3,051

2,691

1

2,692

19

19

13

Consulting

616

0

616

−35

581

578

0

578

7

7

1

Other services

142

0

142

−6

136

140

0

140

1

1

−3

Professional services and other

service revenue

758

0

758

−41

717

718

0

718

6

6

0

Total revenue

3,952

18

3,970

−202

3,768

3,409

1

3,410

16

16

10













Cost of software and software-

related services

−638

106

−532



−513

70

−443

24

20


Cost of professional services and

other services

−619

43

−576



−537

3

−534

15

8


Total cost of revenue

−1,257

149

−1,108



−1,050

73

−977

20

13


Gross profit

2,695

167

2,862



2,359

74

2,433

14

18


Research and development

−547

29

−518



−436

−4

−440

25

18


Sales and marketing

−984

67

−917



−721

19

−702

36

31


General and administration

−232

44

−188



−168

5

−163

38

15


Restructuring

−4

4

0



−1

1

0

>100

0


TomorrowNow litigation

−7

7

0



723

−723

0

<-100

0


Other operating income/expense, net

0

0

0



3

0

3

−100

−100


Total operating expenses

−3,031

300

−2,731

135

−2,596

−1,650

−629

−2,279

84

20

14













Operating profit

921

318

1,239

−67

1,172

1,759

−628

1,131

−48

10

4

Other non-operating income/expense, net

−92

0

−92



0

0

0

N/A

N/A


Finance income

34

0

34



29

0

29

17

17


Finance Cost TomorrowNow litigation

0

0

0



7

−7

0

−100

0


Other finance costs

−41

0

−41



−38

0

−38

8

8


Finance costs

−41

0

−41



−31

−7

−38

32

8


Financial income, net

−7

0

−7



−2

−7

−9

>100

−22


Profit before tax

822

318

1,140



1,757

−635

1,122

−53

2


Income tax TomorrowNow litigation

2

−2

0



−276

276

0

<-100

N/A


Other income tax expense

−206

−98

−304



−229

−32

−261

−10

16


Income tax expense

−204

−100

−304



−505

244

−261

−60

16


Profit after tax

618

218

836



1,251

−391

860

−51

−3


Profit attributable to non-controlling interests

0

0

0



0

0

0

0

0


Profit attributable to owners of parent

618

218

836



1,251

−391

860

−51

−3














Key Ratios












Operating margin in %

23.3


31.2


31.1

51.6


33.2

−28.3pp

−2.0pp

−2.1pp

Effective tax rate in %

24.8


26.7



28.7


23.3

−3.9pp

3.4pp


Basic earnings per share, in €*

0.52


0.70



1.05


0.72

−50

−3














F6

 


for the nine months ended September 30

€ millions, unless otherwise stated

2012

2011

Change in %


IFRS

Adj.*

Non-

IFRS*

Currency

impact**

Non-IFRS

constant

currency**

IFRS

Adj.*

Non-

IFRS*

IFRS

Non-IFRS*

Non-IFRS

constant

currency**

Revenue Numbers












Software

2,722

0

2,722

−122

2,600

2,328

0

2,328

17

17

12

Support

6,071

4

6,075

−245

5,830

5,257

26

5,283

15

15

10

Cloud subscriptions and support

144

39

183

−15

168

12

0

12

1,100

1,425

1,300

Software and software-related

service revenue

8,937

43

8,980

−382

8,598

7,597

26

7,623

18

18

13

Consulting

1,830

0

1,830

−81

1,749

1,726

0

1,726

6

6

1

Other services

433

0

433

−15

418

410

0

410

6

6

2

Professional services and other

service revenue

2,263

0

2,263

−96

2,167

2,136

0

2,136

6

6

1

Total revenue

11,200

43

11,243

−478

10,765

9,733

26

9,759

15

15

10













Cost of software and software-

related services

−1,743

253

−1,490



−1,503

216

−1,287

16

16


Cost of professional services and

other services

−1,888

108

−1,780



−1,672

28

−1,644

13

8


Total cost of revenue

−3,631

361

−3,270



−3,175

244

−2,931

14

12


Gross profit

7,569

404

7,973



6,558

270

6,828

15

17


Research and development

−1,638

97

−1,541



−1,402

36

−1,366

17

13


Sales and marketing

−2,786

177

−2,609



−2,140

96

−2,044

30

28


General and administration

−664

85

−579



−515

23

−492

29

18


Restructuring

−8

8

0



−2

2

0

>100

0


TomorrowNow litigation

−1

1

0



711

−711

0

<-100

0


Other operating income/expense,

net

1

0

1



3

0

3

−67

−67


Total operating expenses

−8,727

729

−7,998

307

−7,691

−6,520

−310

−6,830

34

17

13













Operating profit

2,473

772

3,245

−171

3,074

3,213

−284

2,929

−23

11

5

Other non-operating income/expense, net

−145

0

−145



−34

0

−34

>100

>100


Finance income

86

0

86



78

0

78

10

10


Finance costs TomorrowNow

litigation

−1

1

0



7

−7

0

<-100

N/A


Other finance costs

−118

0

−118



−119

0

−119

−1

−1


Finance costs

−119

1

−118



−112

−7

−119

6

−1


Financial income, net

−33

1

−32



−34

−7

−41

−3

−22


Profit before tax

2,295

773

3,068



3,145

−291

2,854

−27

7


Income tax TomorrowNow litigation

1

−1

0



−276

276

0

<-100

N/A


Other income tax expense

−573

−246

−819



−626

−136

−762

−8

7


Income tax expense

−572

−247

−819



−902

140

−762

−37

7


Profit after tax

1,723

526

2,249



2,242

−151

2,091

−23

8


Profit attributable to non-controlling interests

0

0

0



1

1

2

−100

−100


Profit attributable to owners of parent

1,723

526

2,249



2,241

−152

2,089

−23

8














Key Ratios












Operating margin in %

22.1


28.9


28.6

33.0


30.0

−10.9pp

−1.1pp

−1.4pp

Effective tax rate in %

24.9


26.7



28.7


26.7

−3.8pp

0


Basic earnings per share, in €*

1.45


1.89



1.88


1.76

−23

8



* Adjustments in the revenue line items are for support revenue, cloud subscription revenue, and other similarly recurring revenues that entities acquired by SAP would have recognized had they remained stand-alone entities but that SAP is not permitted to recognize as revenue under IFRS as a result of business combination accounting rules. Adjustments in the operating expense line items are for acquisition-related charges, share-based compensation expenses, restructuring expenses and discontinued activities.

** Constant currency revenue and operating income figures are calculated by translating revenue and operating income of the current period using the average exchange rates from the previous year's respective period instead of the current period. Constant currency period-over-period changes are calculated by comparing the current year's non-IFRS constant currency numbers with the non-IFRS number of the previous year's respective period.


Due to rounding, numbers may not add up precisely.


F7

 

 

NON-IFRS ADJUSTMENTS










€ millions, unless otherwise stated

7/1/ -

9/30/2012

1/1/ -

9/30/2012

7/1/ -

9/30/2011

1/1/ -

9/30/2011






Software and software-related service revenue (IFRS)

3,194

8,937

2,691

7,597

Adjustment for deferred revenue write-down

18

43

1

26

Software and software-related service revenue  (Non-IFRS)

3,212

8,980

2,692

7,623






Operating profit (IFRS)

921

2,473

1,759

3,213

Revenue Adjustments (per above)

18

43

1

26

Adjustment for discontinued activities

7

1

−723

−711

Adjustment for acquisition-related charges 

137

387

110

333

Adjustment for stock-based compensation expenses

152

333

−17

66

Adjustment for restructuring

4

8

1

2

Operating expense adjustments

300

729

−629

−310

Operating profit adjustments

318

772

−628

−284

Operating profit (Non-IFRS)

1,239

3,245

1,131

2,929






Profit after tax  (IFRS)

618

1,723

1,251

2,242

Revenue adjustments (per above)

18

43

1

26

Operating profit adjustments (per above)

300

729

−629

−310

Financial income, net adjustments

0

1

−7

−7

Adjustments pre-tax

318

773

−635

−291

Taxes on adjustments

−100

−247

244

140

Profit after tax (Non-IFRS)

836

2,249

860

2,091






Due to rounding, numbers may not add up precisely.










F8

 

 

 

REVENUE BY REGION

The following tables present our IFRS and non-IFRS revenue by region. Software revenue by region is based on location of negotiation whereas software and software-related service revenue by region and total revenue by region are based on customer location. The tables also present a reconciliation from our non-IFRS revenue (including our non-IFRS revenue at constant currency) to the respective most comparable IFRS revenue. Note: Our non-IFRS revenues are not prepared under a comprehensive set of accounting rules or principles.



for the three months ended September 30

€ millions

2012

2011

 Change in %


IFRS

Adj.*

Non-

IFRS*

Currency

impact**

Non-IFRS

constant

currency**

IFRS

Adj.*

Non-

IFRS*

IFRS

Non-

IFRS*

Non-IFRS

constant

currency**

Software revenue by region












EMEA

374

0

374

−6

368

376

0

376

−1

−1

−2

Americas

458

0

458

−28

430

334

0

334

37

37

29

APJ

194

0

194

−11

183

165

0

165

18

18

11

Software revenue  

1,026

0

1,026

−45

981

875

0

875

17

17

12













Software and software-related service revenue by region












Germany

438

0

438

0

438

420

0

420

4

4

4

Rest of EMEA

957

0

957

−17

940

897

0

897

7

7

5

Total EMEA

1,395

0

1,395

−17

1,378

1,316

0

1,316

6

6

5

United States

921

18

939

−95

844

680

1

681

35

38

24

Rest of Americas

326

0

326

−8

318

258

0

258

26

26

23

Total Americas

1,247

18

1,265

−103

1,162

938

1

939

33

35

24

Japan

174

0

174

−16

158

137

0

137

27

27

15

Rest of APJ

377

0

377

−24

353

300

0

300

26

26

18

Total APJ

552

0

552

−41

511

437

0

437

26

26

17

Software and software-related service revenue

3,194

18

3,212

−161

3,051

2,691

1

2,692

19

19

13













Total revenue by region












Germany

575

0

575

0

575

577

0

577

0

0

0

Rest of EMEA

1,142

0

1,142

−21

1,121

1,086

0

1,086

5

5

3

Total EMEA

1,716

0

1,716

−21

1,695

1,663

0

1,663

3

3

2

United States

1,152

18

1,170

−121

1,049

888

1

889

30

32

18

Rest of Americas

423

0

423

−12

411

334

0

334

27

27

23

Total Americas

1,575

18

1,593

−133

1,460

1,222

1

1,223

29

30

19

Japan

197

0

197

−18

179

158

0

158

25

25

13

Rest of APJ

463

0

463

−29

434

366

0

366

27

27

19

Total APJ

661

0

661

−48

613

524

0

524

26

26

17

Total revenue 

3,952

18

3,970

−202

3,768

3,409

1

3,410

16

16

10














F9

 


for the nine months ended September 30

€ millions

2012

2011

 Change in %


IFRS

Adj.*

Non-

IFRS*

Currency

impact**

Non-IFRS

constant

currency**

IFRS

Adj.*

Non-

IFRS*

IFRS

Non-

IFRS*

Non-IFRS

constant

currency**

Software revenue by region












EMEA

1,069

0

1,069

−13

1,056

987

0

987

8

8

7

Americas

1,131

0

1,131

−76

1,055

909

0

909

24

24

16

APJ

522

0

522

−33

489

432

0

432

21

21

13

Software revenue  

2,722

0

2,722

−122

2,600

2,328

0

2,328

17

17

12













Software and software-related service revenue by region












Germany

1,245

1

1,246

−1

1,245

1,148

0

1,148

8

9

8

Rest of EMEA

2,845

1

2,846

−43

2,803

2,544

7

2,551

12

12

10

Total EMEA

4,090

2

4,092

−44

4,048

3,691

7

3,698

11

11

9

United States

2,456

41

2,497

−219

2,278

1,975

15

1,990

24

25

14

Rest of Americas

872

0

872

−12

860

709

2

711

23

23

21

Total Americas

3,328

41

3,369

−231

3,138

2,684

16

2,700

24

25

16

Japan

489

0

489

−48

441

398

1

399

23

23

11

Rest of APJ

1,030

0

1,030

−59

971

825

1

826

25

25

18

Total APJ

1,519

0

1,519

−107

1,412

1,222

2

1,224

24

24

15

Software and software-related service revenue

8,937

43

8,980

−382

8,598

7,597

26

7,623

18

18

13













Total revenue by region












Germany

1,666

1

1,667

0

1,667

1,617

0

1,617

3

3

3

Rest of EMEA

3,433

1

3,434

−52

3,382

3,143

7

3,150

9

9

7

Total EMEA

5,099

2

5,101

−52

5,049

4,760

7

4,767

7

7

6

United States

3,151

41

3,192

−281

2,911

2,591

15

2,606

22

22

12

Rest of Americas

1,138

0

1,138

−20

1,118

930

2

932

22

22

20

Total Americas

4,289

41

4,330

−300

4,030

3,521

16

3,537

22

22

14

Japan

557

0

557

−55

502

450

1

451

24

24

11

Rest of APJ

1,254

0

1,254

−70

1,184

1,003

1

1,004

25

25

18

Total APJ

1,812

0

1,812

−126

1,686

1,453

2

1,455

25

25

16

Total revenue 

11,200

43

11,243

−478

10,765

9,733

26

9,759

15

15

10













 

Software revenue by customer location


The table below shows the breakdown of software revenue by customer location.


€ millions

Q3 2012

1/1/-9/30/2012

Q3 2011

1/1/-9/30/2011

EMEA

373

1,105

377

988

Americas

459

1,090

333

907

APJ

194

527

165

432

SAP Group

1,026

2,722

875

2,328


* Adjustments in the revenue line items are for support revenue, cloud subscription revenue, and other similarly recurring revenues that entities acquired by SAP would have recognized had they remained stand-alone entities but that SAP is not permitted to recognize as revenue under IFRS as a result of business combination accounting rules.

** Constant currency revenue figures are calculated by translating revenue of the current period using the average exchange rates from the previous year's respective period instead of the current period. Constant currency period-over-period changes are calculated by comparing the current year's non-IFRS constant currency numbers with the non-IFRS number of the previous year's respective period.

For a more detailed description of these adjustments and their limitations as well as our constant currency figures, see our Web site www.sap.com/corporate-en/investors/newsandreports/reporting-framework.epx under "Non-IFRS Measures and Estimates".


Due to rounding, numbers may not add up precisely


F10

 

 

 

SOURCE SAP AG



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