Karl-Heinz Streibich, Chief Executive Officer
Software AG has set itself an ambitious target: We plan to turn our Company into a €1 billion enterprise by 2011. This past quarter, we not only presented our vision and goals to you, but also made significant progress on our way to meeting these goals. Our major achievements included:
We are underlining our leading position in the growth market of service-oriented architecture (SOA) through the planned acquisition of U.S. software manufacturer webMethods Inc. - a leading provider of software solutions for integrating and optimizing business processes. This acquisition will provide us with access to an industry-leading product portfolio as well as increasing our image as an "SOA player" in the U.S. market. We intend to double our U.S. business with this move, providing a key impetus for surpassing the €1 billion revenue mark.
Our geographical expansion continues with the majority takeover of our Israeli sales partner, SPL Software. As a leading provider of IT services and solutions for the Israeli market, SPL has excellent contacts to Israeli institutions, companies, and government authorities.
We have expanded our product portfolio in order to maintain our leading position in the rapidly growing SOA market. The "Active Governance Framework" is a new concept for developing service-oriented architectures. It creates a foundation for planning, managing, and quantifying SOA projects enabling IT systems to be optimally adapted to corporate strategy. This allows our customers to gain the best possible corporate benefits from SOA.
We developed our second product, "SOA Value Assessment," together with a leading IT analyst. The SOA Value Assessment provides IT decision makers with a basis for optimally selecting and managing their enterprise software. The value assessment software performs a detailed analysis of individual SOA aspects such as productivity increases, process efficiency, infrastructure optimization and agility and making it possible to calculate their individual benefits. With the SOA Value Assessment, we support companies in using IT as a strategic business advantage.
Our new brand image complements the technology marketing we have already implemented. We plan to increase our name recognition and improve our image in order to tap into new growth potential. At CeBIT 2007 in March, we presented Software AG's new corporate image to the public for the first time. Our company was extremely well received at the trade fair: More than 650 potential customers, 60 journalists, and 14 politicians visited our booth!
The three crucial steps described above not only enabled Software AG to continue its global success story in the first quarter of 2007, but also served to significantly improve the Company's key figures. Revenues rose by 10 percent (currency adjusted: 15 percent) to €124.7 million, and operating earnings improved considerably by 16 percent to €25.0 million. We not only increased revenue but also increased our profitability. Therefore we once again successfully implemented our strategy of profitable growth in the first quarter. License revenues kept growing in both business lines: Enterprise Transaction Systems increased license revenues by 33 percent on a currency-adjusted basis, and license revenues for Crossvision more than doubled. The sustained, strong growth of our products for corporate-wide integration of business processes has reinforced Software AG's leading position in the market for service-oriented architecture.
Our first quarter figures have confirmed our forecasts for the current fiscal year. Taking SPL Israel into account, but excluding webMethods, we anticipate a currency-adjusted revenue increase of 14 percent and earnings per share ranging from €3.00 to €3.20.
Chief Executive Officer