Other disclosures

1/3 forward

Seasonal influences

Revenues and pre-tax earnings per quarter were as follows in fiscal 2007:

in € thousands Q1 2007 Q2 2007 Q3 2007 Q4 2007 2007
Total revenue 172,581 167,093 157,797 186,544 684,015
in % of annual revenue 25.2 24.4 23.1 27.3 100.0
Earnings before taxes 28,163 37,946 30,412 40,570 137,091
in % of net income for the year 20.5 27.7 22.2 29.6 100.0


In order to show seasonal influences, the revenues of SPL Software Ltd., Israel from January 1, 2007 through March 31, 2007 as well as the revenues of webMethods, Inc., USA from January 1, 2007 through May 24, 2007 were added to the revenues of the Software AG Group. Prior years showed a similar structure of revenues per quarter, which primarily reflects the purchasing behavior of our customers.

Pre-tax earnings show unadjusted values for the Software AG Group, excluding minority interests of acquired companies from the beginning of the year up to the date of acquisition. Because of the acquisitions of these companies and the cost synergies achieved during fiscal year 2007, the presentation does not reflect the normalized profit allocation. For this reason, no forward-looking statements can be derived from this profit allocation.

Given the forward-looking nature of these disclosures, the presentation of the previous year’s figures was omitted.

Contingent liabilities

in € thousands June 30, 2008 Dec. 31, 2007 June 30, 2007
Guarantees 12,922 15,337 11,577
Warranties 632 0 0
Other 1,426 1,341 5,339

14,980 16,678 16,916


The carrying amount of collateral received is €521 thousand (Q2 2007: €0 thousand).

Other financial commitments

The Company has entered into rent and lease agreements for buildings, land, computer and telephone equipment, and vehicles. The obligations under these agreements for their remaining non-cancelable terms up until the end of fiscal 2008 amount to €6,006 thousand (Q2 2007: €7,407 thousand). Obligations of €40,650 thousand exist for the period up until the end of fiscal year 2013 (Q2 2007: €41,090 thousand until the end of fiscal 2012), and obligations of €5,943 thousand for the period after fiscal 2013 (Q2 2007: €17,267 thousand for the period after fiscal 2012). The lease agreements are operating leases as defined in IAS 17.

Stock option plans and stock appreciation rights program

Software AG has different stock option plans for members of the Executive Board, officers, and employees of the Group. In the first half of 2008, in accordance with IFRS 2, personnel expenses of €880 thousand (H1 2007: €1,482 thousand) were recognized for stock option plans with optional fulfillment through equity instruments, of which €571 thousand related to the second quarter (Q2 2007: €97 thousand). In addition, personnel expenses recognized in the first half of 2008 for stock option plans with fulfillment through cash settlement amounted to €1,608 thousand (H1 2007: €0 thousand), of which €764 thousand related to the second quarter (Q2 2007: €0 thousand). In the first half of 2008, a total of 63,372 (H1 2007: 367,756) stock options were exercised from the second stock option plan, of which 27,359 were exercised in the second quarter (Q2 2007: 40,689). A total of 3,504 (H1 2007: 21,418) options were withdrawn in the first half of 2008, of which 3,002 (Q2 2007: 4,689) were exercised in the second quarter. A further total of 125,031 (H1 2007: 270,893) stock options issued to Executive Board members and officers under this plan is outstanding.

Another 14,500 (H1 2007: 0) stock options with an exercise price of €72.36 were issued to officers and employees in the first half of 2008 as part of the third stock price-based compensation plan; as in the previous year, no stock options from the third compensation plan were issued in the second quarter. In addition, a total of 35,190 (H1 2007: 0) stock options were withdrawn from officers and employees due to departure from the Company in the first half of 2008, of which 14,190 (Q2 2007: 0) were withdrawn in the second quarter. In addition, a total of 85,613 (H1 2007: 0) stock appreciation rights were withdrawn from members of the Executive Board, officers and employees due to departure from the Company in the first half of 2008, of which 85,613 (Q2 2007: 0) were withdrawn in the second quarter. Another 160,613 (H1 2007: 0) subscription rights granted as stock options were converted into stock appreciation rights in the first half of 2008, of which 85,613 (Q2 2007: 0) subscription rights granted as stock options were converted in the second quarter. Thus 751,000 (H1 2007: 0) subscription rights were granted as stock options and an additional 1,100,000 (H1 2007: 0) as stock appreciation rights from the third stock price-based compensation plan as of the end of the quarter.
A total of 388,717 (H1 2007: 0) stock options were not measured due to expected employee fluctuation.

Please refer to the 2007 Annual Report for further disclosures on the option plans.