Annual Report 2007
Notes to the Consolidated Income Statement
1/3 forward
1| Revenue
License and maintenance revenues can be broken down by business division as follows:
| ETS | webMethods | Total | |||||
| € thousands | 2007 | 2006 | 2007 | 2006 | 2007 | 2006 | |
| Licenses | 153,026 | 122,344 | 88,313 | 43,398 | 241,339 | 165,742 | |
| Maintenance | 155,735 | 161,885 | 57,203 | 25,393 | 212,938 | 187,278 | |
| Product sales | 308,761 | 284,229 | 145,516 | 68,791 | 454,277 | 353,020 | |
Breakdown of license revenues by sector:
| 2007 | 2006 | ||||
| € thousands | in % | € thousands | in % | ||
| Public sector | 50,804 | 21.1 | 51,535 | 31.1 | |
| Banks and insurance companies | 60,098 | 24.9 | 37,952 | 22.9 | |
| Industry and other | 130,437 | 54.0 | 76,255 | 46.0 | |
| Total | 241,339 | 100.0 | 165,742 | 100.0 | |
Revenues from Professional Services
Professional service revenues include sales of €19,502 thousand, recognized in accordance with the percentage-of-completion method. The individual revenue and expense components of this item can be broken down as follows:
|
€ thousands |
2007 | 2006 |
| Expenses recognized in 2007 | 21,371 | 13,615 |
| Costs accumulated over the term of a (multi-year) project and not yet invoiced | 12,871 | 9,604 |
| Advance payments received | 3,826 | 1,871 |
| Recognized profit/loss | -1,869 | 1,150 |
| Revenue recognized under the POC method in 2007 | 19,502 | 14,765 |
| Retentions | 5 | 0 |
2| Cost of sales
The cost of sales amounted to €181,511 thousand (2006: €149,512 thousand) and primarily consists of personnel expenses incurred by the customer support and Professional Services businesses as well as purchased services in the service business.
3| Research and development expenses
The research and development expenses of €65,900 thousand (2006: €44,858 thousand) mainly contain personnel expenses for product development and related IT expenses.
4| Selling expenses
Selling expenses amounted to €159,208 thousand (2006: €127,246 thousand). In addition to personnel expenses relating to the sales division, these costs mainly include marketing expenses. The significant increase over the previous year was primarily the result of the successful takeover of webMethods Inc., USA.
5| General and administrative expenses
General and administrative expenses amounted to €59,299 thousand (2006: €52,337 thousand). They include administrative expenses which are attributable neither to cost of sales nor to sales activities.
