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Financial position

3.1 Cash flow provides additional strong mainstay

Software AG’s operating cash flow in the third quarter amounted to €47.8 million. This increase of 33 percent was significantly higher than the previous year’s value of €36.0 million, which was attributable primarily to the Company’s effective accounts receivable management. Free cash flow development was likewise especially pleasing: It increased by 37 percent, from €34.2 million in Q3 2008 to €47.0 million in Q3 2009. The percentage of free cash flow in the Group revenue therefore amounted to an excellent 22 percent (2008: 19 percent).

3.2 Total assets and capital expenditure

Due to the consolidation of IDS Scheer AG, Software AG’s total assets rose from €1,073.9 million as of September 30, 2008 to €1,698.2 million on September 30, 2009. Cash and cash equivalents increased from €83.1 million to €194.4 million. Equity climbed 16 percent to €612.1 million (2008: €524.7 million). In contrast, the equity-to-assets-ratio sank from 49 percent to 36 percent at the end of the quarter. On the liabilities side, non-current liabilities grew from €284.2 million to €507.2 million. The financial liabilities increased to €334.2 million as a result of the inclusion of acquisition financing totaling €166.2 million. Likewise, current liabilities climbed from €265.1 million to €578.9 million. The terms for the increased debt due to the takeover are good, and the debt is to be paid off by the end of 2013 with the help of our strong cash flow.