Published: January 13, 2012
SAP Reports Best Ever Full-Year and Fourth Quarter -- Full-Year 2011 Software Revenue Increases 25% At Constant Currencies to euro 4 Billion
WALLDORF, Germany, Jan. 13, 2012 /PRNewswire/ -- After a preliminary review of its 2011 fourth quarter performance, SAP AG (NYSE: SAP) today announced its best ever full-year and fourth quarter performance.
SAP's record performance was driven by outstanding growth in its core applications business, strong momentum for analytics and mobile solutions and accelerated growth for SAP's breakthrough technology SAP HANA. With double-digit growth SAP outperformed the competition and gained significant market share.
SAP significantly exceeded its euro 100 million 2011 target for SAP HANA achieving software revenue of more than euro 160 million. SAP also exceeded its euro 100 million 2011 target for mobile solutions, which contributed more than euro 100 million in software revenue.
"In an uncertain environment, SAP delivered the best year in its 40 year history. We gained significant market share and achieved double-digit growth across all regions," said Bill McDermott and Jim Hagemann Snabe, co-CEOs of SAP. "Our innovation strategy is winning. Customers see the incredible value we deliver and recognize that SAP is the better choice."
"SAP achieved excellent results both on the top and bottom line, expanding our operating margin while we continued to invest in go-to-market activities to capture future growth opportunities," said Werner Brandt, CFO of SAP.
FINANCIAL RESULTS IN DETAIL
All 2011 figures in this release are approximate due to the preliminary nature of the announcement.
FINANCIAL HIGHLIGHTS - Fourth Quarter 2011
Fourth Quarter 2011(1)
---------------------
IFRS Non-IFRS(2)
---- ----------
euro billion, unless
otherwise stated Q4 2011 Q4 2010 % Q4 2011 Q4 2010 % %
change change change
const.
curr.(3)
--- -------
Software revenue 1.74 1.51 16% 1.74 1.51 16% 17%
---------------- ---- ---- --- ---- ---- --- ---
Software and software-
related service revenue 3.72 3.27 14% 3.72 3.31 12% 13%
------------------------ ---- ---- --- ---- ---- --- ---
Total revenue 4.50 4.06 11% 4.50 4.10 10% 10%
------------- ---- ---- --- ---- ---- --- ---
Operating profit 1.67 0.54 206% 1.78 1.62 10% 10%
---------------- ---- ---- --- ---- ---- --- ---
-thereof TomorrowNow
litigation 0.01 -0.94 101% 0 0 0% 0%
-------------------- ---- ----- --- --- --- --- ---
Operating margin (%) 37.0 13.4 23.6pp 39.6 39.6 0 0.1pp
------------------- ---- ---- ------ ---- ---- --- -----
1) All figures are preliminary and unaudited.
2) Adjustments in the revenue line items are for the support revenue that would have been recognized had the acquired entities 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 and discontinued activities.
3) Constant currency revenue and operating profit figures are calculated by translating revenue and operating profit 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 numbers of the previous year's respective period.
Fourth Quarter 2011
-- IFRS software revenue was euro 1.74 billion (2010: euro 1.51 billion),
an increase of 16% (17% at constant currencies).
-- IFRS software and software-related service revenue was euro 3.72 billion
(2010: euro 3.27 billion), an increase of 14%. Non-IFRS software and
software-related service revenue was euro 3.72 billion (2010: euro 3.31
billion), an increase of 12% (13% at constant currencies).
-- IFRS total revenue was euro 4.50 billion (2010: euro 4.06 billion), an
increase of 11%. Non-IFRS total revenue was euro 4.50 billion (2010:
euro 4.10 billion), an increase of 10% (10% at constant currencies).
-- IFRS operating profit was euro 1.67 billion (2010: euro 0.54 billion),
an increase of 206%. Non-IFRS operating profit was euro 1.78 billion
(2010: euro 1.62 billion), an increase of 10% (10% at constant
currencies).
-- IFRS operating margin was 37.0% (2010: 13.4%), an increase of 23.6
percentage points. Non-IFRS operating margin was 39.6% (2010: 39.6%), or
39.7% at constant currencies, an increase of 0.1 percentage points at
constant currencies.
-- Fourth quarter 2011 operating profit and operating margin were impacted
by SAP's continued investments in go-to-market activities intended to
capture future growth opportunities, resulting in a sequential increase
in headcount in sales and marketing by almost 500 full-time-equivalents
(FTEs). Total headcount for the Group grew in the fourth quarter by
almost 1,200 FTEs compared to the previous quarter.
Fourth quarter 2011 non-IFRS operating profit excludes a deferred support revenue write-down from acquisitions of euro 1 million, acquisition-related charges of euro 115 million, profit from discontinued activities of euro 6 million, share-based compensation expenses of euro 3 million and restructuring expenses of euro 2 million (2010: euro 38 million, euro 99 million, expenses of euro 935 million, euro 9 million and -euro 2 million).
FINANCIAL HIGHLIGHTS - Full-Year 2011
Full Year 2011(1)
----------------
IFRS Non-IFRS(2)
---- ----------
euro billion, unless
otherwise stated FY 2011 FY 2010 % FY 2011 FY 2010 % %
change change change
const.
curr.(3)
--- -------
Software revenue 3.97 3.27 22% 3.97 3.27 22% 25%
---------------- ---- ---- --- ---- ---- --- ---
Software and software-
related service revenue 11.32 9.79 16% 11.35 9.87 15% 17%
------------------------ ----- ---- --- ----- ---- --- ---
Total revenue 14.23 12.46 14% 14.26 12.54 14% 15%
------------- ----- ----- --- ----- ----- --- ---
Operating profit 4.88 2.59 88% 4.71 4.01 18% 19%
---------------- ---- ---- --- ---- ---- --- ---
-thereof TomorrowNow
litigation 0.72 -0.98 173% 0 0 0% 0%
-------------------- ---- ----- --- --- --- --- ---
Operating margin (%) 34.3 20.8 13.5pp 33.0 32.0 1.0pp 1.1pp
------------------- ---- ---- ------ ---- ---- ----- -----
1) All figures are preliminary and unaudited.
2) Adjustments in the revenue line items are for the support revenue that would have been recognized had the acquired entities 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 and discontinued activities.
3) Constant currency revenue and operating profit figures are calculated by translating revenue and operating profit 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 numbers of the previous year's respective period.
Full-Year 2011
-- IFRS software revenue was euro 3.97 billion (2010: euro 3.27 billion),
an increase of 22% (25% at constant currencies).
-- IFRS software and software-related service revenue was euro 11.32
billion (2010: euro 9.79 billion), an increase of 16%. Non-IFRS software
and software-related service revenue was euro 11.35 billion (2010: euro
9.87 billion), an increase of 15% (17% at constant currencies). Our
latest non-IFRS software and software-related service revenue guidance
was the high end of the 10% - 14% range at constant currencies.
-- IFRS total revenue was euro 14.23 billion (2010: euro 12.46 billion), an
increase of 14%. Non-IFRS total revenue was euro 14.26 billion (2010:
euro 12.54 billion), an increase of 14% (15% at constant currencies).
-- IFRS operating profit was euro 4.88 billion (2010: euro 2.59 billion),
an increase of 88%. Non-IFRS operating profit was euro 4.71 billion
(2010: euro 4.01 billion), an increase of 18% (19% at constant
currencies). Our latest non-IFRS operating profit guidance was the high
end of the euro 4.45 - euro 4.65 billion range at constant currencies.
Full-year IFRS profit and margin numbers were favorably impacted by the
re-measurement of the TomorrowNow litigation provision while there was
no such effect on SAP's non-IFRS profit and margins.
-- IFRS operating margin was 34.3% (2010: 20.8%), an increase of 13.5
percentage points. Non-IFRS operating margin was 33.0% (2010: 32.0%), or
33.1% at constant currencies, an increase of 1.0 percentage points (1.1
percentage points at constant currencies). Our latest operating profit
guidance resulted in an expected non-IFRS operating margin increase in a
range of 0.5 - 1.0 percentage points at constant currencies.
Full-year 2011 non-IFRS operating profit excludes a deferred support revenue write-down from acquisitions of euro 27 million, acquisition-related charges of euro 448 million, profit from discontinued activities of euro 717 million, share-based compensation expenses of euro 69 million and restructuring expenses of euro 4 million (2010: euro 74 million, euro 304 million, expenses of euro 983 million, euro 58 million and -euro 3 million).
SAP will provide further details of its fourth quarter and full-year 2011 results as well as its outlook for the full-year 2012 on January 25th.
Additional Information
Full-year 2011 revenue, profit and cash flow figures include the revenue, profits and cash flows from Sybase. For the prior-year periods those numbers were only included since the acquisition (July 26, 2010).
For a more detailed description of the non-IFRS adjustments and their limitations as well as our constant currency and free cash flow figures see Explanations of Non-IFRS Measures online (www.sap.com/investor).
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 176,000 customers to operate profitably, adapt continuously, and grow sustainably. For more information, visit www.sap.com.
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