Software AG U.S. Operations Contribute to Q1 2011 Growth
- Q1 total revenue grew 11 percent compared to the same period in 2010
- BPE business line revenue growth was driven by high customer interest in these innovative products with license revenue up nearly 30 percent
- IDS Scheer Consulting revenue grew double digits compared to Q1 of 2010 as a result of improved utilization and new deals
Reston, VA, 4/29/2011
Software AG further increased revenue and earnings according to plan in the first quarter of 2011, reconfirming the company’s sustained growth path. Product revenue in the first three months climbed year-over year by 12 percent, to €164.3 million, while Group revenue grew by 9 percent to €272.6. During the year, the company expects an increase in process innovation projects and affirms the growth forecast for the full year 2011, published in January.
U.S. Operations contributed to Q1 total revenue growth with 11 percent. In addition, the Business Process Excellence (BPE) business line grew with the U.S. seeing the largest share of sales based on customer demand for both webMethods and ARIS products. License revenue increased nearly 30 percent. IDS Scheer Consulting revenue outperformed Group results in the U.S. compared to Q1 of 2010 due to improved use of consultants and gaining new contracts.
According to Mark Edwards, Chief Executive Officer for the Americas & APJ regions (North America, Latin America, Asia Pacific Japan), “We continue to grow and innovate as the high demand for our products and services within the marketplace continues. We are the global technology leader and will further strengthen this position this year.”
Business lines see growth in product business
The Business Process Excellence (BPE) business line—which encompasses revenue from licenses, maintenance, and services for all integration and process software products (webMethods and ARIS) since the merger with IDS Scheer AG—achieved growth of 13 percent (10 percent at constant currency) in Q1 2011, with total revenue of €123.9 million. The pure product business revenue climbed 14 percent to €79.4 million, 11 percent at constant currency rates. This is a significantly above the 6 percent growth rate reported in the fourth quarter 2010. Customer interest in IT solutions for business process optimization rose substantially at this year’s CeBIT trade show, affirming Software AG’s strategy of positioning itself as an innovative market leader in the growth market of process software. Software AG maintained high growth rates in the innovation friendly U.S. market and could extend this above average sales performance to Brazil and Germany.
“We are particularly pleased with the performance of our BPE business line,” said Dean Mericka, President of Sales, Americas, Software AG. “In integration and process software projects, the number of large deals has increased by 15 percent from the same time period in 2010. U.S. customers are adopting innovative products and setting us apart from the competition.”
During the quarter under review, the Enterprise Transaction Systems (Adabas, Natural) business line showed a substantial increase in sales. In the product business, revenue of €79.1 million for licenses and maintenance exceeded that of the previous year by 10 percent. Licensing revenues achieved €30.4 million, an increase of 19 percent over Q1 2010 (€25.6 million). In the first quarter, the business line’s total revenue amounted to €96.8 million—9 percent (5 percent at constant currency) higher than the previous year’s total of €89.1 million. This has laid a solid foundation for the business line to achieve its objectives for the full year 2011.
Revenues for the IDS Scheer Consulting business stabilized at the previous year’s level with €51.9 million. Utilization of the consultants has improved over the previous year as has the business line's contribution to earnings. More expert process consultants are being hired to handle the increased orders.
Key figures *
|in millions of Euros|| |
∆ in %
|- Product revenues||164.2||146.7||+12%|
|- BPE business line||123.9||109.7||+13%|
|- ETS business line||96.8||89.1||+9%|
|Earnings per share (EPS) (in €)**||1.41||0.98||+44%|
|Free cash flow||49.1||59.8||-18%|
|- Employees in Germany ||1,990||2,185||-9%|
* IFRS unaudited
** Weighted average number of shares outstanding (basic) 28.443.602
*** Full time equivalent
About Software AG
With more than 1,000 U.S.-enterprise customers and 800 employees, Software AG's U.S. operation contributes one third of the company's total revenue and is Software AG's largest market presence and R&D location. Software AG has operated nationwide in the U.S. since 1973 through a fully-owned subsidiary, Software AG USA Inc., which is headquartered in Reston, Virginia – also an R&D hub for the company’s core data management and integration technologies. R&D labs for the development of Software AG’s webMethods product suite – offering SOA integration and BPM solutions – include facilities in San José/Silicon Valley, Seattle and Denver. For more information, visit www.softwareag.com/us.
Software AG is the global leader in Business Process Excellence. Our 40 years of innovation include the invention of the first high-performance transactional database, Adabas; the first business process analysis platform, ARIS; and the first B2B server and SOA-based integration platform, webMethods.
We offer our customers end-to-end business process management (BPM) solutions delivering low Total-Cost-of-Ownership and high ease of use. Our industry-leading brands, ARIS, webMethods, Adabas, Natural, CentraSite and IDS Scheer Consulting, represent a unique portfolio encompassing: process strategy, design, integration and control; SOA-based integration and data management; process-driven SAP implementation; and strategic process consulting and services.
Software AG had revenues of €1.1 billion in 2010 and has more than 5,600 employees serving 10,000 enterprise and public institution customers across 70 countries. Our comprehensive software and services solutions allow companies to continuously achieve their business results faster. The company is headquartered in Germany and listed on the Frankfurt Stock Exchange (TecDAX, ISIN DE 0003304002 / SOW).
Software AG – Get There Faster
Software AG | Uhlandstraße 12 | 64297 Darmstadt | Germany
Senior Manager, Public Relations
11700 Plaza America Drive, Suite 700
Reston, Virginia 20190
Tel: +1 703 391-6627
Fax: +1 703 390-7401