SAP Announces Second Quarter 2014 Results - WTVM.com-Columbus, GA News Weather & Sports

SAP Announces Second Quarter 2014 Results

Information contained on this page is provided by an independent third-party content provider. WorldNow and this Station make no warranties or representations in connection therewith. If you have any questions or comments about this page please contact pressreleases@worldnow.com.

SOURCE SAP SE

SAP Raises Cloud Outlook

Strong Cloud Momentum with 39% Growth and Broad Market Adoption of SAP HANA Continues - Validating "Run simple" Vision

WALLDORF, Germany, July 17, 2014 /PRNewswire/ --

  • Raising Full Year 2014 Non-IFRS Cloud Subscriptions and Support Revenue Outlook to €1,000 – €1,050 Million at Constant Currencies
  • Fastest Growing Enterprise Cloud Company at Scale: Non-IFRS Cloud Subscriptions and Support Revenue Increased 39% at Constant Currencies (32% at Actual Currencies)
  • Strong Cloud Billings: Non-IFRS Calculated Cloud Billings Increased 37% at Constant Currencies
  • Growing the World's Largest Business Network: Approximately 1.55 Million Connected Companies Transacting Approximately $540 Billion
  • Broad Market Adoption of SAP HANA as Real-Time Business Platform: 1,200 SAP Business Suite on HANA Customers
  • Delivered Second Quarter at High End of Full Year SSRS Outlook: Non-IFRS Software and Software-Related Service Revenue Increased 8% at Constant Currencies (4% at Actual Currencies to €3.48 Billion)
  • IFRS Operating Profit of €698 Million (2013: €988 Million) Impacted by Provision of €289 Million for Seven-Year Old Versata Litigation
  • Non-IFRS Operating Profit Increased 7% at Constant Currencies (4% at Actual Currencies to €1.24 Billion), Resulting in a 60 Basis Point Increase in Non-IFRS Operating Margin at Constant Currencies1
SAP Logo.

SAP SE (NYSE: SAP) today announced its financial results for the second quarter and first half ended June 30, 2014.

BUSINESS HIGHLIGHTS IN THE SECOND QUARTER 2014

SAP again delivered strong growth in the cloud and a solid performance in its core business. With non-IFRS cloud subscriptions and support revenue increasing 39% at constant currencies (32% at actual currencies) SAP is the fastest growing enterprise cloud company at scale2. Non-IFRS software and software-related service revenue grew 8% at constant currencies (4% at actual currencies).

At the Company's user conference SAPPHIRE NOW in May SAP launched the "Run simple" strategy with cloud and SAP HANA at its core to simplify the business experience and consumption for its customers. HANA is radically simplifying the technology stack. Cloud is radically simplifying the consumption of SAP's solutions. As a first example for "Run simple" the Company has included the SAP FIORI user experience within underlying licenses of SAP software.

"We are successfully executing our shift to the cloud helping customers run simple – from total workforce management in the cloud to frictionless commerce through the world's largest business network," said Bill McDermott, CEO of SAP. "And we are redefining customer engagement with our omni-channel e-commerce platform – all of this in real time demonstrating our clear commitment to be THE Cloud Company powered by SAP HANA."

"With 8% constant currency growth in non-IFRS software and software-related service revenue we are delivering solid growth at the high end of our full year outlook range. We continue to improve our profitability with operating profit up 7% on a non-IFRS constant currency basis leading to double-digit growth in non-IFRS EPS," said Luka Mucic, CFO of SAP. "As we continue to expand our cloud business we have increased our full year non-IFRS cloud subscriptions and support revenue outlook to €1,000 – €1,050 million at constant currencies."

SAP's annual cloud revenue run rate is now approaching €1.2 billion3 or $1.6 billion4. Non-IFRS calculated cloud billings5 increased 37% year-over-year at constant currencies. Non-IFRS deferred cloud subscriptions and support revenue was €448 million as of June 30, 2014, a year-over-year increase of 29% at constant currencies. SAP's cloud applications total subscribers now exceed 38 million, which is the most of any enterprise cloud vendor in the industry today. The Company has also launched "Industry Cloud" to build the deepest and broadest industry cloud solutions.

SAP is redefining customer engagement. Its hybris omni-channel e-commerce platform in combination with Cloud for Sales saw triple-digit growth in software revenue and cloud subscriptions and support revenue.

SAP is enabling the global "Network Economy" with approximately 1.55 million connected companies on the world's largest cloud-based business trading community. Trailing twelve month Ariba network spend volume6 was approximately $540 billion – two times the size of Amazon and eBay combined. The addition of Fieldglass expands our network capabilities by increasing our addressable market to cover flexible workforce in addition to materials and services.

The Company saw continued broad market adoption of SAP HANA as the Real-Time Business Platform across all industries and regions. SAP HANA is at the core of the Company's "Run simple" strategy: integrating all SAP solutions on ONE business platform in the Cloud. SAP saw accelerated HANA momentum and now has more than 3,600 HANA customers and more than 1,200 customers for SAP Business Suite on HANA. SAP HANA is also evolving into the leading technology platform with more than 1,500 startup companies building applications on SAP HANA and new strategic partnerships with HP and VMware.

Second Quarter 2014 Regional Revenue

SAP saw a strong performance in EMEA, despite uncertainties due to the Ukraine crisis. Non-IFRS software and software-related service revenue increased 8% year-over-year at constant currencies. This was the result of 51% growth in non-IFRS cloud subscriptions and support revenue at constant currencies for the region as well as strong software revenue growth in the UK and France.

The Americas region had a solid performance. Non-IFRS software and software-related service revenue increased 6% year-over-year at constant currencies. The region continued the fast transition to the cloud with 34% growth in non-IFRS cloud subscriptions and support revenue at constant currencies. SAP also saw strong software revenue growth in Canada and continues to see strong demand in Latin America with tremendous growth opportunities.

In the APJ region SAP had a strong performance. Non-IFRS software and software-related service revenue grew by 12% at constant currencies. Non-IFRS cloud subscriptions and support revenue grew by 48% at constant currencies. Australia and Malaysia were highlights, with strong triple-digit software revenue growth at constant currencies.

FINANCIAL RESULTS IN DETAIL

 

FINANCIAL HIGHLIGHTS – Second Quarter 2014



Second Quarter 20141)


IFRS

Non-IFRS2)

€ million, unless otherwise stated

Q2 2014

Q2 2013

% change

Q2 2014

Q2 2013

% change

% change const. curr.









Cloud subscriptions and support

241

159

52

242

183

32

39

Software

957

982

-2

957

982

-2

1

Support

2,279

2,177

5

2,280

2,182

4

9

Software and support

3,237

3,159

2

3,238

3,164

2

6

Software and software-related service revenue

3,478

3,318

5

3,480

3,347

4

8

Total revenue

4,151

4,062

2

4,153

4,091

2

5

Total operating expenses

-3,453

-3,074

12

-2,917

-2,905

0

5

Operating profit

698

988

-29

1,236

1,186

4

7

Operating margin (%)

16.8

24.3

-7.5pp

29.8

29.0

0.8pp

0.6pp

Profit after tax

556

724

-23

938

850

10


Basic earnings per share (€)

0.47

0.61

-23

0.79

0.71

10


Number of employees (FTE)

67,651

64,937

4

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 F10 in the appendix to this press release.

IFRS cloud subscriptions and support revenue was €241 million (2013: €159 million), an increase of 52%. Non-IFRS cloud subscriptions and support revenue was €242 million (2013: €183 million), an increase of 32% (39% at constant currencies). IFRS software and support revenue was €3.24 billion (2013: €3.16 billion), an increase of 2%. Non-IFRS software and support revenue was €3.24 billion (2013: €3.16 billion), an increase of 2% (6% at constant currencies). IFRS software and software-related service revenue was €3.48 billion (2013: €3.32 billion), an increase of 5%. Non-IFRS software and software-related service revenue was €3.48 billion (2013: €3.35 billion), an increase of 4% (8% at constant currencies). IFRS total revenue was €4.15 billion (2013: €4.06 billion), an increase of 2%. Non-IFRS total revenue was €4.15 billion (2013: €4.09 billion), an increase of 2% (5% at constant currencies).

IFRS operating profit was €698 million (2013: €988 million), a decrease of 29%. Non-IFRS operating profit was €1.24 billion (2013: €1.19 billion), an increase of 4% (7% at constant currencies). IFRS operating margin was 16.8% (2013: 24.3%), a decrease of 7.5 percentage points. The IFRS operating profit and margin were negatively impacted by the Versata litigation provision. Non-IFRS operating margin was 29.8% (2013: 29.0%), or 29.5% at constant currencies, an increase of 0.6 percentage points at constant currencies.

IFRS profit after tax was €556 million (2013: €724 million), a decrease of 23%. Non-IFRS profit after tax was €938 million (2013: €850 million), an increase of 10%. IFRS basic earnings per share was €0.47 (2013: €0.61), a decrease of 23%. Non-IFRS basic earnings per share was €0.79 (2013: €0.71), an increase of 10%. The IFRS and non-IFRS effective tax rates in the second quarter of 2014 were 22.6% (2013: 24.8%) and 25.4% (2013: 26.8%), respectively.

 

FINANCIAL HIGHLIGHTS – First Half 2014



First Half 20141)


IFRS

Non-IFRS2)

€ million, unless otherwise stated

1H 2014

1H 2013

% change

1H 2014

1H 2013

% change

% change const. curr.









Cloud subscriptions and support

460

296

55

463

350

32

38

Software

1,581

1,638

-4

1,581

1,638

-4

1

Support

4,492

4,286

5

4,495

4,295

5

9

Software and support

6,072

5,924

3

6,075

5,934

2

6

Software and software-related service revenue

6,533

6,220

5

6,538

6,284

4

8

Total revenue

7,849

7,663

2

7,854

7,727

2

6

Total operating expenses

-6,428

-6,029

7

-5,699

-5,639

1

5

Operating profit

1,421

1,634

-13

2,155

2,088

3

7

Operating margin (%)

18.1

21.3

-3.2pp

27.4

27.0

0.4pp

0.3pp

Profit after tax

1,090

1,244

-12

1,604

1,539

4


Basic earnings per share (€)

0.91

1.04

-12

1.34

1.29

4


Number of employees (FTE)

67,651

64,937

4

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 F10 in the appendix to this press release.

IFRS cloud subscriptions and support revenue was €460 million (2013: €296 million), an increase of 55%. Non-IFRS cloud subscriptions and support revenue was €463 million (2013: €350 million), an increase of 32% (38% at constant currencies). IFRS software and support revenue was €6.07 billion (2013: €5.92 billion), an increase of 3%. Non-IFRS software and support revenue was €6.08 billion (2013: €5.93 billion), an increase of 2% (6% at constant currencies). IFRS software and software-related service revenue was €6.53 billion (2013: €6.22 billion), an increase of 5%. Non-IFRS software and software-related service revenue was €6.54 billion (2013: €6.28 billion), an increase of 4% (8% at constant currencies). IFRS total revenue was €7.85 billion (2013: €7.66 billion), an increase of 2%. Non-IFRS total revenue was €7.85 billion (2013: €7.73 billion), an increase of 2% (6% at constant currencies).

IFRS operating profit was €1.42 billion (2013: €1.63 billion), a decrease of 13%. Non-IFRS operating profit was €2.16 billion (2013: €2.09 billion), an increase of 3% (7% at constant currencies). IFRS operating margin was 18.1% (2013: 21.3%), a decrease of 3.2 percentage points. The IFRS operating profit and margin were negatively impacted by the Versata litigation provision. Non-IFRS operating margin was 27.4% (2013: 27.0%), or 27.4% at constant currencies, an increase of 0.3 percentage points at constant currencies.

IFRS profit after tax was €1.09 billion (2013: €1.24 billion), a decrease of 12%. Non-IFRS profit after tax was €1.60 billion (2013: €1.54 billion), an increase of 4%. IFRS basic earnings per share was €0.91 (2013: €1.04), a decrease of 12%. Non-IFRS basic earnings per share was €1.34 (2013: €1.29), an increase of 4%. The IFRS and non-IFRS effective tax rates in the first half of 2014 were 23.4% (2013: 21.5%) and 25.6% (2013: 24.5%), respectively.

Cash Flow – First Half 2014

Operating cash flow was €2.58 billion (2013: €2.48 billion), an increase of 4% year-over-year. Free cash flow was €2.27 billion (2013: €2.22 billion), an increase of 2% year-over-year. Free cash flow was 29% of total revenue (2013: 29%). At June 30, 2014, SAP had a total group liquidity of €3.18 billion (December 31, 2013: €2.84 billion), which includes cash and cash equivalents and short term investments. Net liquidity at June 30, 2014 was -€1.06 billion compared to -€1.47 billion at December 31, 2013.

BUSINESS OUTLOOK 2014

The Company updated its outlook for the full-year 2014:

  • The Company now expects full year 2014 non-IFRS cloud subscriptions and support revenue to be in a range of €1,000 – €1,050 million (previously €950 – €1,000 million) at constant currencies (2013: €757 million). The upper end of this range represents a growth rate of 39%.
  • The Company continues to expect full year 2014 non-IFRS software and software-related service revenue to increase by 6% - 8% at constant currencies (2013: €14.03 billion).
  • The Company continues to expect full-year 2014 non-IFRS operating profit to be in a range of €5.8 billion – €6.0 billion at constant currencies (2013: €5.48 billion).

While the Company's full-year 2014 business outlook is at constant currency, actual currency reported figures are expected to continue to be negatively impacted by currency exchange rate fluctuations. If exchange rates remain at the June 2014 level for the rest of the year, the Company expects non-IFRS software and software-related service revenue and non-IFRS operating profit growth rates at actual currency to experience a negative currency impact of approximately 2 percentage points and 2 percentage points respectively for the third quarter of 2014 and of approximately 2 percentage points and 2 percentage points respectively for the full year 2014.

Additional Information
2014 revenue, profit and cash flow figures include the revenue and profits from hybris and Fieldglass. The comparative numbers for 2013 do not include Fieldglass and hybris was included first on August 1, 2013.

In the second quarter 2014 SAP recognized an expense resulting from a provision for the Versata litigation in the amount of €289 million. In contrast, the respective operating expense from the second quarter of 2013 decreased as SAP reversed the then-existing Versata provision of €33 million in response to the United States Patent and Trademark Office (USPTO) decision to cancel the disputed patent. The Versata litigation is a seven year old case that is still ongoing. Recent developments in the courts have made it probable that SAP will be required to pay Versata although the patent has been canceled by the USPTO. For more information about this litigation, see the Notes to the second quarter 2014 Interim Report (Interim Financial Statements section, Note (16)).

While the resulting provision for the Versata litigation impacts SAP's IFRS operating profit and margin it does not have an effect on SAP's non-IFRS operating profit and margin. Beginning with Q2 2014 SAP now additionally adjusts its non-IFRS operating expenses definition by excluding the expenses resulting from the Versata litigation. Prior period amounts have been adjusted to comply with the new definition.

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.

Second Quarter 2014 Interim Report
SAP's second quarter 2014 Interim Report was published today and is available for download at www.sap.com/investor.

Webcast
SAP senior management will host a conference call for financial analysts and media on Thursday, July 17th at 2:00 PM (CEST) / 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.

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 261,000 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.

© 2014 SAP SE.  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 SE.  The information contained herein may be changed without prior notice.

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

These materials are provided by SAP SE 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 SE (or an SAP affiliate company) in Germany and other countries.  Please see http://www.sap.com/corporate-en/about/legal/copyright/index.html#trademark for additional trademark information and notices.

 

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, financial community only:

Stefan Gruber 

+49 (6227) 7-44872 

investor@sap.com, CET




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

Andy Kendzie 

+1 (202) 312-3919 

andy.kendzie@sap.com, ET

Claudia Cortes 

+65 6664-4450 

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




Follow SAP Investor Relations on Twitter at @sapinvestor.

 

1 Starting in the second quarter 2014 SAP additionally adjusted its non-IFRS operating expenses definition by excluding the expenses resulting from the Versata litigation. Prior period amounts have been adjusted to comply with the new definition. Second quarter 2013 non-IFRS operating margin is now 29.0%.
2 Defined as enterprise application companies with an annual cloud revenue run rate above €1 billion.
3 The annual revenue run rate is the total of second quarter 2014 non-IFRS cloud subscriptions and support revenue (€242 million) plus non-IFRS cloud-related professional services and other service revenue (€54 million) multiplied by 4.
4 Translated into USD for reader's convenience based on $/€ exchange rate of $1.37/€1.00 at the end of the second quarter 2014.
5 Total of a period's cloud subscriptions and support revenue and of the respective period's change in the deferred cloud subscription and support revenue balance. The opening balance for Fieldglass deferred cloud subscriptions and support revenue at May 2, 2014 was €1 million (both on an IFRS and non-IFRS basis). In the second quarter 2014, Fieldglass contributed €11 million to SAP's cloud subscriptions and support revenue (both on an IFRS and non-IFRS basis).
6 Network spend volume is the total value of purchase orders transacted on the Ariba Network in the trailing 12 months.

 

Appendix – Financial Information to Follow

FINANCIAL INFORMATION

FOR THE SECOND QUARTER 2014

(Condensed and Unaudited)






Page



Financial Statements (IFRS, Unaudited)


    Consolidated Income Statements 

F1-F2

    Consolidated Statements of Financial Position 

F3

    Consolidated Statements of Cash Flows 

F4



Supplementary Financial Information (Unaudited)


    Reconciliation from Non-IFRS Numbers to IFRS Numbers 

F5-F8

    Calculated Cloud Billings 

F9

    Explanation of Non-IFRS Adjustments 

F10

    Revenue by Region 

F11-F12

Financial Statements (IFRS, Unaudited)

 

Consolidated Income Statements of SAP Group – Quarter


For the three months ended June 30

€ millions, unless otherwise stated


2014

2013

Change

in %

Cloud subscriptions and support


241

159

52

Software


957

982

-2

Support


2,279

2,177

5

Software and support


3,237

3,159

2

Software and software-related service revenue


3,478

3,318

5

Professional services and other service revenue


673

744

-10

Total revenue


4,151

4,062

2






Cost of software and software-related services


-698

-630

11

Cost of professional services and other services


-591

-609

-3

Total cost of revenue


-1,289

-1,240

4

Gross profit


2,862

2,822

1

Research and development


-566

-567

0

Sales and marketing


-1,049

-1,059

-1

General and administration


-218

-232

-6

Restructuring


-39

-17

>100

TomorrowNow and Versata litigation


-289

33

<-100

Other operating income/expense, net


-3

9

<-100

Total operating expenses


-3,453

-3,074

12

Operating profit


698

988

-29






Other non-operating income/expense, net


4

-2

<-100

Finance income


47

26

79

Finance costs


-30

-49

-39

Financial income, net


17

-23

<-100

Profit before tax


719

963

-25

Income tax TomorrowNow and Versata litigation


76

-9

<-100

Other income tax expense


-239

-230

4

Income tax expense


-163

-239

-32

Profit after tax


556

724

-23

Profit attributable to non-controlling interests


-1

0

38

Profit attributable to owners of parent


557

725

-23






Earnings per share, basic (in €)*


0.47

0.61

-23

Earnings per share, diluted (in €)*


0.47

0.61

-23


* For the three months ended June 30, 2014 and 2013, the weighted average number of shares was 1,194 million (diluted 1,197 million) and 1,193 million (diluted: 1,195 million), respectively (treasury stock excluded).


Due to rounding, numbers may not add up precisely.


F1

 

 

Consolidated Income Statements of SAP Group – Half-Year


For the six months ended June 30

€ millions, unless otherwise stated


2014

2013

Change

in %

Cloud subscriptions and support


460

296

55

Software


1,581

1,638

-4

Support


4,492

4,286

5

Software and support


6,072

5,924

3

Software and software-related service revenue


6,533

6,220

5

Professional services and other service revenue


1,316

1,443

-9

Total revenue


7,849

7,663

2






Cost of software and software-related services


-1,343

-1,234

9

Cost of professional services and other services


-1,182

-1,215

-3

Total cost of revenue


-2,525

-2,448

3

Gross profit


5,324

5,215

2

Research and development


-1,116

-1,124

-1

Sales and marketing


-2,016

-2,034

-1

General and administration


-423

-429

-1

Restructuring


-54

-31

78

TomorrowNow and Versata litigation


-290

32

<-100

Other operating income/expense, net


-4

5

<-100

Total operating expenses


-6,428

-6,029

7

Operating profit


1,421

1,634

-13






Other non-operating income/expense, net


-7

-13

-48

Finance income


69

56

24

Finance costs


-61

-93

-35

Financial income, net


9

-37

<-100

Profit before tax


1,423

1,584

-10

Income tax TomorrowNow and Versata litigation


77

-9

<-100

Other income tax expense


-409

-331

23

Income tax expense


-332

-340

-2

Profit after tax


1,090

1,244

-12

Profit attributable to non-controlling interests


-1

0

>100

Profit attributable to owners of parent


1,091

1,245

-12






Earnings per share, basic (in €)*


0.91

1.04

-12

Earnings per share, diluted (in €)*


0.91

1.04

-12


* For the six months ended June 30, 2014 and 2013, the weighted average number of shares was 1,194 million (diluted 1,197 million) and 1,193 million (diluted: 1,195 million), respectively (treasury stock excluded).


Due to rounding, numbers may not add up precisely.


F2

 

 

Consolidated Statements of Financial Position of SAP Group


as at June 30, 2014 and December 31, 2013

€ millions


2014

2013

Cash and cash equivalents


3,123

2,748

Other financial assets


230

251

Trade and other receivables


3,614

3,865

Other non-financial assets


470

346

Tax assets


172

142

Total current assets


7,610

7,352

Goodwill


14,380

13,684

Intangible assets


2,907

2,956

Property, plant, and equipment


1,847

1,820

Other financial assets


726

607

Trade and other receivables


80

98

Other non-financial assets


105

107

Tax assets


192

172

Deferred tax assets


379

292

Total non-current assets


20,616

19,736

Total assets


28,226

27,089


as at June 30, 2014 and December 31, 2013

€ millions


2014

2013

Trade and other payables


846

850

Tax liabilities


205

433

Financial liabilities


580

748

Other non-financial liabilities


1,616

2,263

Provision TomorrowNow and Versata litigation


514

223

Other provisions


320

422

Provisions


834

645

Deferred income


3,304

1,408

Total current liabilities


7,385

6,347

Trade and other payables


50

45

Tax liabilities


355

318

Financial liabilities


3,791

3,758

Other non-financial liabilities


115

112

Provisions


211

278

Deferred tax liabilities


102

109

Deferred income


63

74

Total non-current liabilities


4,687

4,694

Total liabilities


12,072

11,041

Issued capital


1,229

1,229

Share premium


578

551

Retained earnings


16,156

16,258

Other components of equity


-582

-718

Treasury shares


-1,234

-1,280

Equity attributable to owners of parent


16,147

16,040

Non-controlling interests


7

8

Total equity


16,154

16,048

Total equity and liabilities


28,226

27,089


Due to rounding, numbers may not add up precisely.


F3

 

 

Consolidated Statements of Cash Flows of SAP Group


For the six months ended June 30

€ millions

2014

2013

Profit after tax

1,090

1,244

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



Depreciation and amortization

478

478

Income tax expense

332

340

Financial income, net

-9

37

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

16

38

Other adjustments for non-cash items

52

44

Decrease/increase in trade and other receivables

297

470

Decrease/increase in other assets

-188

-129

Decrease/increase in trade payables, provisions, and other liabilities

-593

-945

Decrease/increase in deferred income

1,855

1,735

Cash outflows due to TomorrowNow and Versata litigation

0

-1

Interest paid

-73

-80

Interest received

27

33

Income taxes paid, net of refunds

-709

-782

Net cash flows from operating activities

2,575

2,482




Business combinations, net of cash and cash equivalents acquired

-729

-99

Purchase of intangible assets and property, plant, and equipment

-304

-265

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

27

23

Purchase of equity or debt instruments of other entities

-713

-1,200

Proceeds from sales of equity or debt instruments of other entities

721

1,079

Net cash flows from investing activities

-998

-462




Dividends paid

-1,194

-1,013

Proceeds from reissuance of treasury shares

27

9

Proceeds from borrowings

500

0

Repayments of borrowings

-586

0

Net cash flows from financing activities

-1,253

-1,004




Effect of foreign exchange rates on cash and cash equivalents

51

-107

Net decrease/increase in cash and cash equivalents

375

909

Cash and cash equivalents at the beginning of the period

2,748

2,477

Cash and cash equivalents at the end of the period

3,123

3,386


Due to rounding, numbers may not add up precisely.


F4

 

 

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 June 30

€ millions, unless otherwise stated

2014

2013

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












Cloud subscriptions and support

241

1

242

12

254

159

24

183

52

32

39

Software

957

0

957

29

987

982

0

982

-2

-2

1

Support

2,279

1

2,280

90

2,370

2,177

5

2,182

5

4

9

Software and support

3,237

1

3,238

119

3,357

3,159

5

3,164

2

2

6

Software and software-related service revenue

3,478

2

3,480

131

3,611

3,318

29

3,347

5

4

8

Professional services and other service revenue

673

0

673

26

699

744

0

744

-10

-10

-6

thereof cloud-related

54

0

54

2

56

39

0

39

39

39

44

Total revenue

4,151

2

4,153

157

4,310

4,062

29

4,091

2

2

5













Cloud subscriptions and support

241

1

242

12

254

159

24

183

52

32

39

Cloud-related professional services revenue

54

0

54

2

56

39

0

39

39

39

44

Cloud revenue

295

1

296

14

310

198

24

222

49

34

40













Operating Expense Numbers












Cost of software and software-related services

-698

86

-612



-630

76

-554

11

10


thereof cloud

-105

17

-87



-71

21

-50

47

75


Cost of professional services and other services

-591

33

-559



-609

23

-586

-3

-5


Total cost of revenue

-1,289

118

-1,171



-1,240

99

-1,140

4

3


Gross profit

2,862

120

2,982



2,822

129

2,951

1

1


Research and development

-566

35

-531



-567

17

-551

0

-3


Sales and marketing

-1,049

43

-1,006



-1,059

44

-1,015

-1

-1


General and administration

-218

12

-206



-232

24

-208

-6

-1


Restructuring

-39

39

0



-17

17

0

>100

0


TomorrowNow and Versata litigation

-289

289

0



33

-33

0

<-100

0


Other operating income/expense, net

-3

0

-3



9

0

9

<-100

<-100


Total operating expenses

-3,453

536

-2,917

-119

-3,036

-3,074

168

-2,905

12

0

5



F5

 

 


For the three months ended June 30

€ millions, unless otherwise stated

2014

2013

Change in %


IFRS

Adj.*

Non-IFRS*

Currency

Impact**

Non-IFRS

Constant

Currency**

IFRS

Adj.*

Non-IFRS*

IFRS

Non-IFRS*

Non-IFRS

Constant

Currency**

Profit Numbers












Operating profit

698

538

1,236

38

1,273

988

198

1,186

-29

4

7

Other non-operating income/expense, net

4

0

4



-2

0

-2

<-100

<-100


Finance income

47

0

47



26

0

26

79

79


Finance costs

-30

0

-30



-49

0

-49

-39

-39


Financial income, net

17

0

17



-23

0

-23

<-100

<-100


Profit before tax

719

538

1,257



963

198

1,161

-25

8


Income tax TomorrowNow and Versata litigation

76

-76

0



-9

9

0

<-100

>100


Other income tax expense

-239

-80

-319



-230

-81

-311

4

3


Income tax expense

-163

-156

-319



-239

-72

-311

-32

3


Profit after tax

556

382

938



724

125

850

-23

10


Profit attributable to non-controlling interests

-1

0

-1



0

0

0

38

38


Profit attributable to owners of parent

557

382

939



725

125

850

-23

10














Key Ratios












Operating margin (in %)

16.8


29.8


29.5

24.3


29.0

-7.5pp

0.8pp

0.6pp

Effective tax rate (in %)

22.6


25.4



24.8


26.8

-2.2pp

-1.4pp


Earnings per share, basic (in €)

0.47


0.79



0.61


0.71

-23

10




F6

 

 


For the six months ended June 30

€ millions, unless otherwise stated

2014

2013

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












Cloud subscriptions and support

460

2

463

22

485

296

54

350

55

32

38

Software

1,581

0

1,581

67

1,647

1,638

0

1,638

-4

-4

1

Support

4,492

3

4,495

173

4,667

4,286

10

4,295

5

5

9

Software and support

6,072

3

6,075

239

6,315

5,924

10

5,934

3

2

6

Software and software-related service revenue

6,533

5

6,538

261

6,800

6,220

64

6,284

5

4

8

Professional services and other service revenue

1,316

0

1,316

56

1,372

1,443

0

1,443

-9

-9

-5

thereof cloud-related

98

0

98

4

102

82

0

82

19

19

24

Total revenue

7,849

5

7,854

318

8,172

7,663

64

7,727

2

2

6













Cloud subscriptions and support

460

2

463

22

485

296

54

350

55

32

38

Cloud-related professional services revenue

98

0

98

4

102

82

0

82

19

19

24

Cloud revenue

558

2

560

26

587

378

54

433

47

30

36













Operating Expense Numbers












Cost of software and software-related services

-1,343

165

-1,178



-1,234

173

-1,060

9

11


thereof cloud

-188

36

-152



-154

58

-96

22

58


Cost of professional services and other services

-1,182

58

-1,124



-1,215

51

-1,164

-3

-3


Total cost of revenue

-2,525

223

-2,302



-2,448

224

-2,224

3

4


Gross profit

5,324

228

5,552



5,215

288

5,503

2

1


Research and development

-1,116

58

-1,057



-1,124

38

-1,086

-1

-3


Sales and marketing

-2,016

77

-1,939



-2,034

96

-1,939

-1

0


General and administration

-423

27

-396



-429

33

-396

-1

0


Restructuring

-54

54

0



-31

31

0

78

0


TomorrowNow and Versata litigation

-290

290

0



32

-32

0

<-100

0


Other operating income/expense, net

-4

0

-4



5

0

5

<-100

<-100


Total operating expenses

-6,428

729

-5,699

-237

-5,936

-6,029

390

-5,639

7

1

5



F7

 

 


For the six months ended June 30

€ millions, unless otherwise stated

2014

2013

Change in %


IFRS

Adj.*

Non-IFRS*

Currency

Impact**

Non-IFRS

Constant

Currency**

IFRS

Adj.*

Non-IFRS*

IFRS

Non-IFRS*

Non-IFRS

Constant

Currency**

Profit Numbers












Operating profit

1,421

735

2,155

81

2,236

1,634

454

2,088

-13

3

7

Other non-operating income/expense, net

-7

0

-7



-13

0

-13

-48

-48


Finance income

69

0

69



56

0

56

24

24


Finance costs

-61

0

-61



-93

0

-93

-35

-35


Financial income, net

9

0

9



-37

0

-37

<-100

<-100


Profit before tax

1,423

735

2,157



1,584

454

2,038

-10

6


Income tax TomorrowNow and Versata litigation

77

-77

0



-9

9

0

<-100

>100


Other income tax expense

-409

-144

-553



-331

-168

-499

23

11


Income tax expense

-332

-221

-553



-340

-159

-499

-2

11


Profit after tax

1,090

514

1,604



1,244

295

1,539

-12

4


Profit attributable to non-controlling interests

-1

0

-1



0

0

0

>100

>100


Profit attributable to owners of parent

1,091

514

1,605



1,245

295

1,540

-12

4














Key Ratios












Operating margin (in %)

18.1


27.4


27.4

21.3


27.0

-3.2pp

0.4pp

0.3pp

Effective tax rate (in %)

23.4


25.6



21.5


24.5

1.9pp

1.2pp


Earnings per share, basic (in €)

0.91


1.34



1.04


1.29

-12

4




* Adjustments in the revenue line items are for support revenue, cloud subscriptions and support 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, discontinued activities, and the Versata litigation.

** 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.


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.


F8

 

 

CALCULATED CLOUD BILLINGS

The following table presents the calculated cloud billings metric which we define as the total of a period's cloud subscription and support revenue and of the respective period's change in the deferred cloud subscription and support revenue balance. The table also reconciles the non-IFRS calculated cloud billings metric (including our non-IFRS at constant currency metric) to the respective IFRS based calculated cloud billings metric.


For the three months ended June 30

€ millions, unless otherwise stated

2014

2013


IFRS

Adj.*

Non-IFRS*

Cur-

rency

Impact**

Non-IFRS

Cons-

tant

Cur-

rency**

IFRS

Adj.*

Non-IFRS*

Cur-

rency

Impact**

Non-IFRS

Cons-

tant

Cur-

rency**

Cloud subscriptions and support

241

1

242

12

254

159

24

183

0

183

Closing balance deferred cloud subscriptions and support

445

3

448

30

478

354

7

361

9

370

Opening balance deferred cloud subscriptions and support

451

3

454

37

491

344

33

377

0

377

Change in deferred cloud subscriptions and support

      -6

0

       -6  

     -7  

-13  

10

-26 

-16  

9

-7  

Calculated cloud billings

235

1

236

5

241

169

-2 

167

9

176












Year-over-year changes (2014 vs. 2013, in %)

39%


41%


37%







* Adjustments in the revenue and deferred revenue line items are for cloud subscriptions and support 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 deferred revenue balances are calculated by translating the current period's opening and closing deferred revenue balances as well as the comparative period's closing deferred revenue balance using the opening exchange rates of the comparative 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.


F9

 

 

EXPLANATION OF NON-IFRS ADJUSTMENTS


€ millions, unless otherwise stated

4/1 –6/30/

2014

1/1 –6/30/

2014

4/1 –6/30/

2013

1/1 –6/30/

2013

Software and software-related service revenue (IFRS)

3,478

6,533

3,318

6,220

Adjustment for deferred revenue write-down

2

5

29

64

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

3,480

6,538

3,347

6,284






Operating profit (IFRS)

698

1,421

988

1,634

Revenue Adjustments (per above)

2

5

29

64

Adjustment for discontinued activities

0

1

0

0

Adjustment for Versata litigation

289

289

-33

-32

Adjustment for acquisition-related charges 

131

261

145

283

Adjustment for stock-based compensation expenses

76

124

39

109

Adjustment for restructuring

39

54

17

31

Operating expense adjustments

536

729

168

390

Operating profit adjustments

538

735

198

454

Operating profit (Non-IFRS)

1,236

2,155

1,186

2,088






Profit after tax  (IFRS)

556

1,090

724

1,244

Revenue adjustments (per above)

2

5

29

64

Operating profit expense adjustments (per above)

536

729

168

390

Adjustments pre-tax

538

735

198

454

Taxes on adjustments

-156

-221

-72

-159

Profit after tax (Non-IFRS)

938

1,604

850

1,539


Due to rounding, numbers may not add up precisely.


F10

 

 

REVENUE BY REGION

The following tables present our IFRS and non-IFRS revenue by region 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 June 30

€ millions

2014

2013

 Change in %


IFRS

Adj.*

Non-IFRS*

Currency

Impact**

Non-IFRS

Constant

Currency**

IFRS

Adj.*

Non-IFRS*

IFRS

Non-IFRS*

Non-IFRS

Constant

Currency**

Cloud subscriptions and support revenue by region












EMEA

60

0

60

2

61

41

0

41

47

47

51

Americas

160

1

162

9

170

103

24

127

55

27

34

APJ

21

0

21

1

22

15

0

15

38

38

48

Cloud subscriptions and support revenue

241

1

242

12

254

159

24

183

52

32

39













Software and software-related service revenue by region












EMEA

1,632

1

1,633

17

1,650

1,528

0

1,528

7

7

8

Americas

1,290

2

1,292

77

1,369

1,263

29

1,292

2

0

6

APJ

555

0

555

37

592

527

0

527

5

5

12

Software and software-related service revenue

3,478

2

3,480

131

3,611

3,318

29

3,347

5

4

8













Total revenue by region












Germany

597

0

597

0

598

593

0

593

1

1

1

Rest of EMEA

1,369

1

1,370

21

1,391

1,277

0

1,277

7

7

9

Total EMEA

1,967

1

1,967

21

1,989

1,869

0

1,869

5

5

6

United States

1,162

2

1,163

54

1,217

1,138

29

1,167

2

0

4

Rest of Americas

384

0

384

40

424

431

0

431

-11

-11

-2

Total Americas

1,546

2

1,547

94

1,641

1,569

29

1,599

-2

-3

3

Japan

134

0

134

11

146

147

0

147

-8

-8

-1

Rest of APJ

504

0

504

31

535

477

0

477

6

6

12

Total APJ

638

0

638

42

681

623

0

623

2

2

9

Total revenue 

4,151

2

4,153

157

4,310

4,062

29

4,091

2

2

5



F11

 

  


For the six months ended June 30

€ millions

2014

2013

 Change in %


IFRS

Adj.*

Non-IFRS*

Currency

Impact**

Non-IFRS

Constant

Currency**

IFRS

Adj.*

Non-IFRS*

IFRS

Non-IFRS*

Non-IFRS

Constant

Currency**

Cloud subscriptions and support revenue by region












EMEA

114

0

114

3

117

81

0

81

41

41

45

Americas

307

2

309

16

325

186

54

241

65

29

35

APJ

40

0

40

3

42

29

0

29

36

36

46

Cloud subscriptions and support revenue

460

2

463

22

485

296

54

350

55

32

38













Software and software-related service revenue by region












EMEA

3,071

2

3,072

41

3,113

2,878

0

2,878

7

7

8

Americas

2,471

3

2,474

140

2,614

2,355

64

2,419

5

2

8

APJ

992

0

992

81

1,073

987

0

987

1

1

9

Software and software-related service revenue

6,533

5

6,538

261

6,800

6,220

64

6,284

5

4

8













Total revenue by region












Germany

1,132

0

1,132

1

1,133

1,121

0

1,121

1

1

1

Rest of EMEA

2,602

1

2,604

51

2,655

2,427

0

2,427

7

7

9

Total EMEA

3,734

2

3,736

51

3,787

3,547

0

3,547

5

5

7

United States

2,225

3

2,228

98

2,326

2,123

64

2,187

5

2

6

Rest of Americas

740

0

740

73

813

816

0

816

-9

-9

0

Total Americas

2,965

3

2,968

171

3,139

2,939

64

3,003

1

-1

5

Japan

264

0

264

30

294

299

0

299

-12

-12

-2

Rest of APJ

886

0

886

65

950

877

0

877

1

1

8

Total APJ

1,149

0

1,150

95

1,245

1,177

0

1,177

-2

-2

6

Total revenue 

7,849

5

7,854

318

8,172

7,663

64

7,727

2

2

6



* Adjustments in the revenue line items are for support revenue, cloud subscriptions and support 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.


F12

Logo - http://photos.prnewswire.com/prnh/20110126/AQ34470LOGO

©2012 PR Newswire. All Rights Reserved.

Powered by WorldNow

1909 Wynnton Road
Columbus, Ga. 31906

FCC Public File
publicfile@wtvm.com
706-494-5400
EEO Report
Closed Captioning

All content © Copyright 2000 - 2014 Worldnow and WTVM. All Rights Reserved.
For more information on this site, please read our Privacy Policy and Terms of Service.