Quarterly figures: Software AG delivers a better than expected – Wirtschaftswoche

After selling the business with consulting for SAP software, Software AG has performed better than had been expected by analysts. The profit decline was slowed down.

Software AG has slowed the decline in earnings at the beginning only thanks to the weakness of the euro. Earnings before interest and taxes fell in the first quarter by four percent over the previous year period to 29.3 million euros, as the software company announced on Wednesday. Without the foreign exchange gains in business outside the euro zone, which accounts for nearly two-thirds, the operating profit would have decreased by 17 percent. Last year’s figure, however, is still the meantime sold business consulting for SAP software.

The share nevertheless increased by up to 3.4 per cent and was thus Leader in the TecDax. Firstly, the quarterly figures were not as bad as feared. Secondly, the Darmstadt had announced on Tuesday night that they feed 7.9 million shares, whereby the share capital reduced by more than nine percent. That leaves investors hoping for more dividends. In addition, the company is to be authorized at the general meeting on 13 May to further share buybacks.

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The IT group must continue zuzukaufen, in order to grow.

The authoritative for the Board performance indicator, the earnings before interest, taxes, depreciation and amortization, increased by five million euros to 48.1 million euros. As adjusted for the SAP business turnover of January fell slightly to March to 194 million euros, the operating margin improved to 25 percent.

Analysts polled by Reuters had expected weaker numbers of Hesse that since more than three years against the profit shrinkage fight. For the sales they had expected 192 million euros and EBIT of 26.8 million euros. CEO Karl-Heinz Streibich pointed out that the maintenance revenue increased to 100 million euros, which was the share of recurring revenues increase more than 50 percent.

The Software AG is after much hesitation to the trend towards rental software on the jumped Internet and hopes that the cloud business a boost. The first important products can also order as a cloud version of the client now. Over the next eighteen months the entire portfolio will be available. “This is a firm commitment,” Streibich said.