SAP Asia Pacific Japan Reports Double-Digit Q1 2007 Growth

April 24, 2007 by SAP News 0

SAP Customer and Partner Ecosystems Continue to Grow in Asia Pacific and Japan

SingaporeSAP Asia Pacific Japan today announced it once again achieved double-digit year-on-year quarterly growth with Asia Pacific Japan first quarter 2007 software revenue growing 16 percent in constant currency to €77 million. Asia Pacific Japan Q1 2007 software and software related service revenues grew 10 percent on a constant currency basis to €197 million. Total revenues in Asia Pacific grew 11 percent year-on-year in constant currency to €267 million.

SAP’s Global Core Enterprise Application Software market share† increased 2.4 percentage points during Q1 2007 as customers repeatedly chose SAP over competitor offerings. In Asia Pacific, leading analyst firms have also confirmed SAP’s market share leadership. More than 350 new customers selected SAP solutions in Asia Pacific and Japan in Q1 2007 — equivalent to nearly five new customers every working day.

“SAP Asia Pacific Japan has once again beaten the market with double-digit software license growth,” said Geraldine McBride, President & CEO, SAP Asia Pacific Japan. “Our organic growth strategy has been proven as the best and most customer-centric way to rapidly accelerate and transform our business. Looking forward, with some of the world’s leading and fastest growing economies in the region, we plan to more than double the size of our business by 2010.”

Enterprise SOA in APJ Today
More than 1,000 customers have gone live on SAP™ ERP 2005 since its launch – the fastest adoption rate of an ERP release in the Company’s history – as their stepping stone to enterprise service-oriented architecture (SOA). In Q1 2007, SAP Asia Pacific Japan helped to fuel that growth with more than eighty customers upgrading to the latest release of SAP’s enterprise resource planning (ERP) application. There are now more than 8,500 customers on SAP ERP, more than 1,000 of which are in Asia Pacific and Japan.

“We are right on schedule with our roadmap to deliver the entire SAP Business Suite on the BPP by the end of this year and we expect to continue to bring additional enterprise services to market throughout the year on top of the 1,000 already delivered,” said Ms. McBride. “We are the only business application software company offering a fully integrated enterprise solution suite on top of a Java-based, open platform today. Customers looking for enterprise SOA today come to SAP, which is why we saw more than 100% growth in SAP NetWeaver® sales in the region in Q1 2007.”

Power of the Portfolio
The first quarter of 2007 further accelerated SAP Asia Pacific Japan’s success serving small and midsize enterprises (SME) in the region, with revenues growing 2.5-times the overall SME software market. The SME business unit of SAP Asia Pacific Japan contributed nearly 50 percent of SAP’s revenue in the region. There are now more than 5,300 SAP SME customers in Asia Pacific and Japan, with more than 10 SME deals per working day added in the first quarter of 2007 alone. This is only expected to increase as customers continue to take advantage of the next version of SAP® All-in-One solutions as part of the Company’s expanding portfolio of SAP and SAP-certified partner solutions.

Safe Passage
A growing list of companies in Asia Pacific are making use of the SAP Safe Passage program to migrate away from the uncertainties arising out of Oracle’s acquisition of PeopleSoft, JD Edwards, Siebel and Retek. Globally, nearly 550 customers have taken advantage of the program, with more than 30 customers in Asia Pacific, of which six were in the first quarter of 2007 alone. One of these customers, India’s leading tire manufacturing company, MRF Limited, was drawn to replace existing applications from Oracle in favour of SAP’s leading SAP ERP and SAP™ CRM solutions, based on the SAP NetWeaver platform. (see separate SAP India release) MRF found the SAP solutions would provide superior visibility of their entire operations and the flexibility to respond to dynamic markets. MRF provides yet another example of the Safe Passage program’s ability to provide companies with a proven and affordable road map to protect their current investments and to begin the process of innovating their businesses today.

Another forward-thinking Safe Passage customer making the decision to migrate from Oracle to SAP solutions in Q1 was Philippines-headquartered leading milk producer, Alaska Milk Corporation. “In order to further expand our leadership in the milk industry, we needed a solution that was built on a proven open and flexible platform. We also wanted to provide our distributors with solutions that would meet their needs, while still seamlessly interfacing with our enterprise systems. SAP ERP on SAP NetWeaver and SAP® Business One meet these criteria. After an extensive evaluation, we felt it was the right decision to move from our legacy client server-based Oracle technology to service-enabled SAP solutions,” said Wilfred Steven Uytengsu, President and Chief Operating Officer of Alaska Milk Corporation.

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Selection of Key Customer Wins for SAP Asia Pacific Japan in Q1 2007:

Australia / New Zealand
Wet Technologies Pte Ltd (Wholesale)
Waitakere City Council (Public Sector)

China
Nanfang Lee Kum Kee Co., Ltd. (Consumer Products)

PICC Holding Company (Insurance)

Hong Kong
Group Sense Ltd. (High Tech)
Mitshubishi Electric Hong Kong Group (Electronics)

India
GMR Group (Engineering & Construction)
MRF Ltd. (Automotive)

Indonesia
PT. Kaltim Parna Industri (Chemicals)
Yayasan Sejahtera Progress (Healthcare)

Japan
Marubeni-Itochu Steel Inc. (Metal)
Kobe Steel (Wholesale)

Korea
Daesang F&F (Consumer Products)
Donghee Industrial Co., Ltd. (Automotive)

Malaysia
Godell Parking Sdn Bhd (Automotive)
MKF Metal & Plastics Industries Sdn (Metal)

Philippines
Alaska Milk (Consumer Products)
Norkis Trading Co., Inc. (Automotive)

Singapore
StarHub (Info-communications)
ACR Capital Holdings Pte Ltd (Insurance)

Taiwan
Abnova Corporation (Healthcare)
Chang Ho Fibre Corporation (Chemicals)

Thailand
PTT ICT Solutions Company Limited (Oil & Gas)
Siam Commercial Bank Public (Banking)

† Based on software and software related service revenues on a rolling four quarter basis, SAP’s worldwide share of Core Enterprise Applications vendors, which account for approximately $34.8 billion in software and software related service revenues as defined by the Company based on industry analyst research, increased to 25.1% for the four quarter period ended March 31, 2007 compared to 24.5% for the four quarter period ended December 31, 2006. Compared to the four quarter period ended March 31, 2006, the year-over-year share gain was 2.4 percentage points.

Beginning in the first quarter of 2007, the Company began using software and software related service revenues for defining Core Enterprise Application Vendor Share because the Company believes that this is the most important indicator for vendor share oriented analysis with the realignment of its income statement structure. Prior to the first quarter of 2007, the Company had been using software revenues for defining Core Enterprise Application Vendor Share.

The Company provides share data based on the vendors of Core Enterprise Applications solutions, which account for approximately $34.8 billion in software and software related service revenues as defined by the Company based on industry analyst research. For 2007, industry analysts project approximately 7% year-on-year growth for core Enterprise Applications vendors. For its quarterly share calculation, SAP assumes that this approximate 7% growth will not be linear throughout the year. Instead, quarterly adjustments are made based on the financial performance of a sub set (approximately 25) of Core Enterprise Application vendors.

About Safe Passage
Safe Passage programs from SAP are comprehensive offerings from SAP addressing the concerns of Oracle customers of all sizes facing the uncertainties of the end of life of Oracle, PeopleSoft, JD Edwards, Siebel and Retek solutions. The elements of Safe Passage programs include: access to SAP’s best-in-class enterprise resource planning (ERP) and other market-leading solutions; financial protection for a customer’s existing investment in Oracle EBS, PeopleSoft, JD Edwards, Siebel Systems and Retek; SAP Financing options; immediate integration benefits through the SAP NetWeaver® platform; and migration support services. In addition, third-party maintenance for certain PeopleSoft and JD Edwards solutions is available through SAP subsidiary TomorrowNow and SAP’s network of channel partners focused on small and midsize enterprises. For more information, please visit www.sap.com/safepassage.