SAP Asia Pacific Japan Q3 2008 earnings show strategic consistency, further strengthening SAP’s competitive position across the region

November 4, 2008 by SAP News 0

SAP Asia Pacific Japan continues its role as SAP’s global growth engine

SingaporeSAP Asia Pacific Japan (“APJ”) today announced a 24 per cent growth in its Q3 2008 Software Revenue to €146 million. Software and Software-Related Service Revenues in Asia Pacific Japan grew 24 per cent, to €294 million, while Total Revenue for the quarter grew 20 per cent, to €384 million. All revenue numbers quoted in this release are in Non-GAAP constant currency. All percentage growth figures are measured against the previous comparable period.

For the nine months to September 30, 2008, SAP APJ’s Software Revenue grew 40 per cent, highlighting the APJ region’s continued role as global growth engine for SAP worldwide. Over the same period, Software and Software-Related Service Revenues in APJ also grew 33 per cent, while Total Revenue grew 27 per cent.

Geraldine McBride, President and CEO, SAP Asia Pacific Japan said: “In spite of difficult market conditions, SAP APJ has delivered a solid third quarter performance. Key markets such as India and China continued their strong performance, while emerging markets in Southeast Asia continued to show further potential for revenue growth.”

“SAP APJ’s strategic approach to growing its share of the Region’s Business Software market remains unchanged by current economic circumstances. We remain convinced that developing compelling business cases for our Customers will ensure we continue to gain market share across the Region,” she continued.

“We have been introducing Customers of all sizes to ‘Best-Run Now’ value packages, which aim at streamlining budgeting and forecasting processes, helping to manage workforce productivity and deliver real value to Customer bottom-lines – all of which is particularly important in difficult times.”

Talent development remains important in Asia Pacific Japan

Even in the current difficult market circumstances, SAP APJ is continuing to invest in the growth of its high quality ecosystem via the expansion of education programs. During Q3 2008, SAP APJ launched the inaugural global post-graduate Education Foundations Program in Beijing, Dalian and Shanghai. The new program is an addition to SAP’s existing investment in education across the Region, and aims to promote the growth of the SAP Ecosystem by providing a direct source of skilled software professionals and qualified SAP consultants for Partners and Customers.

By 2010, the new program will provide more than 2,000 students every year with a high-touch, high-value learning experience, equipping them with the necessary skills to meet growing market demands in China. Following the successful launch in China, the program is soon to be rolled out to other key global markets.

Continued Strong Adoption of SAP by Customers in Q3 2008

Almost 40 per cent of all SAP APJ deals year-to-date came from new Customers, up significantly from the previous corresponding period.

“In difficult times Customers need us more than ever. SAP’s continued emphasis on the delivery of bottom-line value, wrapped together in a way which appeals to Customers of all types, is compelling,” said McBride. “The closer integration of Business Objects products into our Customer offerings has also played a role in successfully differentiating our offerings. All the large account deals we focused on across the Region in Q3 2008 were successfully closed.”

SAP APJ’s SME performance in Q3 was consistent, in line with previous quarters, generating double digit growth. During the quarter, SAP APJ also launched the Fast-Start Program for SAP Business All-in-One in the region. This innovative program delivers value and flexibility, allowing Customers to configure and cost their solutions online. The program met with immediate success, generating more than 100 new customers via SAP’s partner network.

The continued acceptance of SAP APJ’s Business Process Platform was further demonstrated by strong revenue growth during Q3 2008.

“In spite of difficult market conditions, we clearly see SAP APJ’s focused delivery of value to its Customers remaining the successful growth model for our Region,” concluded McBride.

Use of Non-GAAP Financial Measures
This press release contains certain financial measures such as Non-GAAP revenues, Non-
GAAP operating income, Non-GAAP operating margin, free cash flow, constant currency revenue and operating income measures, as well as U.S. Dollar based Non-GAAP revenue numbers. These measures are not prepared in accordance with U.S. GAAP and therefore are considered non-GAAP financial measures. Our non-GAAP financial measures may not correspond to non-GAAP financial measures that other companies report. The non-GAAP financial measures that we report should be considered as additional to, and not as a substitute for or superior to revenue, operating margin or our other measures of financial performance prepared in accordance with U.S. GAAP. See the Appendix at the end of the financial section of this press release for additional information regarding the Non-GAAP measures included in this press release and for the reconciliations to the corresponding U.S. GAAP measures.

About SAP
SAP is the world’s leading provider of business software(*), offering applications and services that enable companies of all sizes and in more than 25 industries to become best-run businesses. With approximately 76,000 customers (includes customers from the acquisition of Business Objects) in over 120 countries, the company is listed on several exchanges, including the Frankfurt stock exchange and NYSE, under the symbol “SAP.” (For more information, visit www.sap.com)

(*) SAP defines business software as comprising enterprise resource planning and related applications.

Any statements contained in this document that are not historical facts are forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Words such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “project,” “predict,” “should” and “will” and similar expressions as they relate to SAP are intended to identify such forward-looking statements. SAP undertakes no obligation to publicly update or revise any forward-looking statements. All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from expectations. The factors that could affect SAP’s future financial results are discussed more fully in SAP’s filings with the U.S. Securities and Exchange Commission (“SEC”), including SAP’s most recent Annual Report on Form 20-F filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates.

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Selection of Key Customer Wins for SAP Asia Pacific in Q3 2008

ANZ

CorpTech (Public Sector)
Officeworks Superstores Pty Ltd (Retail)

India
Goldshield Services Private Limited (Wholesale)
J K Lakshmi Cement Ltd (Building Materials)
Jindal Steel and Power Ltd (Primary Metal & Mini)
Walchandnagar Industries Limited (Engineering & Construction)

Japan
Central Finance Co., Ltd. (Banking)
Japan Airlines International (Passenger & Cargo)
Macnica Inc. (Wholesale)
Mitsubishi Electric Information (Professional Services)
Panasonic Corporation (High Tech & Electron)
Tomen Electronics Corp. (Wholesale)

North Asia
China Telecom System Integration Co., Ltd (Telecommunications)
Gansu Electric Power Corp. (Utilities & Waste)
Guangdong Power Grid Corporation Shenzhen Power Supply Bureau (Utilities & Waste)
Hubei Electric Power Corp. (Utilities & Waste)
Hunan Provincial Power Corp. (Utilities & Waste)
Qingdao Mesnac Co., Ltd. (Industry Machinery)
Qinghai Electric Power Corp. (Utilities & Waste)
SANY Holding Co., Ltd. (Industrial Machinery)
Shenzhen Noposion Agrochemicals Co., Ltd (Consumer Products)
Shougang Jingtang United Iron & Steel Co., Ltd (Primary Metal & Mini)
Halla Climate Control Corp. (Automotive)
Samsung SDS Co., Ltd. (Engineering & Construction)
Goldsun Development & Construction (Building Materials)
Shin Kong Mitsukoshi Dept. Store Co., Ltd. (Retail)
Universal Scientific Industrial Co., Ltd. (High Tech & Electron)
Wah Lee Industrial Corp. (High Tech & Electron)

South East Asia
CNOOC SES Ltd (Oil & Gas)
PT Indofood Sukses Makmur Tbk (Consumer Products)
Sarawak Energy Berhad (Professional Services)
San Miguel Corporation (Consumer Products)
Wuthelam Holdings Pte Ltd (Retail)

SAP Q3 2008 Financial Statements
Financial Statement (PDF)