Ad hoc Disclosure (Inside Information according to article 17 MAR): Software AG publishes preliminary Q1 2019 financial results and raises 2019 Outlook for Adabas & Natural business line
Today, the Management Board of Software AG (MDAX, ISIN DE000A2GS401 / SOW) pre-announced its financial figures (IFRS, preliminary) for the first quarter of 2019. According to an initial consolidation of the results, the company showed higher than expected license revenue in the A&N business line driven by the capacity extensions of major deals. Due to a few deal slippages from Q1 to Q2, the revenue of DBP excluding Cloud & IoT increased only by 1% compared to the previous year’s level. Software AG’s Cloud & IoT revenue increase of 49% in Q1 does not yet fully reflect the company’s dynamic growth expectation for the full year (75% to 125%).
The slower start in the new year in DBP and Cloud & IoT was impacted by the reorganization of the salesforce in North America and a late global sales kick-off which led to a slower execution in Q1 versus the previous year. Including professional services of EUR 46.7 million (previous year: EUR 46.1 million), the company’s total revenue in the first quarter increased by 8 percent reaching EUR 201.4 million. Based on an initial consolidation of the results, the expected EBIT will be EUR 42.2 million, and in line with the prior year’s level. Reflecting the HELIX investments, the Group’s EBITA (non-IFRS) margin will be 25.6% (previous year 27.4%). Based on the current business development and the pipeline at the end of Q1 2019, Software AG’s Management Board raised its 2019 outlook for A&N to -3% to +3% (previously -5% to 0%) revenue growth at constant currency. The 2019 outlook for DBP (+3% to +7% revenue growth at constant currency), Cloud & IoT (+75% to +125% revenue growth at constant currency) and EBITA margin (non-IFRS) (28% to 30%) remain unchanged.
An analyst & media call will be held on Friday, 12 April 2019 at 09:00 CEST
The full Q1 financial figures will be published on April 18th, 2019.
Darmstadt, April 11, 2019
The Management Board