SAP Asia Pacific Reports Double-Digit 2006 Full-Year Growth

SAP Ranks #1 in All Enterprise Software Solutions in Asia Pacific for 4th Year Straight

SingaporeSAP Asia Pacific today announced it achieved yet another year of double-digit annual growth with Asia Pacific(1) 2006 software revenue growing 12 percent year-on-year in constant currency to €391 million. Asia Pacific Q4 2006 software revenue grew nine percent on a constant currency basis to €134 million. Software revenues in Japan increased 17 percent on a constant currency basis to €131 million for full-year 2006. Total revenues in Asia Pacific grew 15 percent year-on-year in constant currency to €1.1 billion, resulting in SAP’s second consecutive year of €1 billion revenue in the region. SAP’s Global Core Enterprise Application Software market share† increased 2.8 percentage points during 2006 as customers repeatedly chose SAP over competitor offerings. In Asia Pacific, leading analyst firms also confirmed SAP’s market share leadership in 2006.(2)

Nearly 2,000 new customers selected SAP solutions in Asia Pacific in 2006 — equivalent to nearly one new customer every working hour. More than two-thirds of those customers were small and midsize enterprises (SMEs), an increasingly important and rapidly growing segment of SAP Asia Pacific’s customer base. In 2006, SAP Asia Pacific announced its plans to more than triple its SME customer base by 2010. Even while SAP delivers value to more and more customers around the region, customer satisfaction levels are at an all time high.

“SAP Asia Pacific celebrates its second consecutive year of market-beating, double-digit software license growth, while our market share leadership continues to increase,” said Geraldine McBride, President, SAP Asia Pacific. “Rapid adoption of mySAP™ ERP 2005, the world’s first Business Process Platform (BPP), was key to this growth as customers looked for a stepping stone to enterprise SOA. Our momentum in the SME market has increased as we continue to deliver localized industry packages that help customers deploy rapidly with lower total cost of ownership. The customer comes first at SAP, which is why customers have made us number one year after year.”

#1 in Asia Pacific Enterprise Software

In its most recent biannual Asia Pacific (excluding Japan) market share analysis, IDC, a leading provider of global IT research and advice, found SAP to be the number one enterprise software vendor in the region for the fourth straight year, since the inception of the study.(3) Based on software license and maintenance revenue, SAP ranked number one in all enterprise applications and seven industry verticals tracked by IDC in APEJ in 1H06. The applications categories measured included Enterprise Resource Management (ERM), also known as ERP and including Human Capital Management (HCM), Customer Relationship Management (CRM), and Product Supply Chain (PSC), also known as Supply Chain Management (SCM). In addition, SAP was the leader serving the APEJ small and midsize business (SMB) market in 1H2006 in each application category IDC researched, including ERM, CRM and PSC, and number one in manufacturing, government and retail, banking, transportation, insurance and education.(4)

Investing for the Future in Asia Pacific

SAP Asia Pacific continued its commitment to organic growth in Asia Pacific by adding 1,579 full time equivalent employees in the region in 2006, a more than 25 percent increase in headcount in just one year. Particular growth occurred in China’s and India’s expanding R&D facilities and SAP’s award-winning Shared Services Centre in Singapore, which is now saving SAP more than US$2 million annually. 2006 also brought a number of new Centres of Excellence to the region in key industries such as retail and public sector. Looking forward to 2010, SAP has announced plans to invest US$1 billion in India over the next five years and triple its development headcount in China to more than 1,500. Due to expanding growth potential in
India, SAP Asia Pacific elevated India to “Hub” status in 2006. SAP Asia Pacific is now
organized into six interdependent Hubs reporting to President Geraldine McBride — Greater India; Southeast Asia; Australia and New Zealand; North Asia; and Japan.

Selection of Key Customer Wins for SAP Asia Pacific in Q4 2006:


United Group (Machinery)

WA Business News (Media)


E&E Linen (Hangzhou) Co., Ltd. (Retail)

Sino-French Life Insurance Co., Ltd. (Insurance)

Hong Kong

Fook Tin Technologies, Ltd. (Consumer)

Giant Electronics (High Tech)


Havell’s India Limited (Utilities)

Lanco Infratech Limited (Infrastructure)


Agis Electronics (Retail)

Taiho Nusantara (Automotive)


House Foods Corporation (Consumer Products)

Matsushita Electric Industrial (High Tech)


Humax Co., Ltd. (High Tech)

SI FLEX Co., Ltd. (High Tech)


Commerce Asset Ventures Private Equity Management (Financial Services)

Hornbill Airways (Transportation)

New Zealand

A&R Whitcoulls Group Holdings P/L (Retail)

Gallagher Group Limited (Metal Products)


Land Bank of the Philippines (Financial Services)

Robinsons Land Corp. (Service Provider)


CapitaLand Limited (Machinery)

National University of Singapore (Higher Education)


Megatone Electronics (High Tech)

Korenix Technology (High Tech)


Home Product Center Public (Retail)

United Broadcasting Corporation (Telecommunications)

1) SAP’s definition of “Asia Pacific” includes Japan.

2) See previous market share leadership announcements: “SAP Leads Enterprise Software Market in Asia Pacific and Worldwide” & “SAP Ranks #1 in All Enterprise Software Solutions and Seven Industry Verticals in Asia Pacific”

3) IDC Asia/Pacific Semiannual Software Tracker, 1H2006. Countries covered in the research include Australia, New Zealand, Korea, People’s Republic of China, Taiwan, Hong Kong, India, Singapore, Thailand, and Malaysia

4) IDC defines “SMB” as a company with between 10 and 499 employees.

† Core Enterprise Applications Vendor Share In previous quarters, worldwide peer group share was provided based on a peer group of Microsoft Corp. (business solutions segment only), Oracle Corp. (business applications only) and Siebel Systems, Inc. The Company believes that after the large amount of consolidation that has occurred among the larger companies in the software industry, the peer group has become too small to provide an adequate metric for the purpose of measuring growth of sales share. Therefore, the Company will now be providing share data based on the vendors of Core Enterprise Applications solutions, which account for approximately $16 billion in software revenues as defined by the Company based on industry analyst research. For 2006, industry analysts project approximately 4% year-on-year growth for core Enterprise Applications vendors. For its quarterly share calculation, SAP assumes that this approximate 4% growth will not be linear throughout the year. Instead, quarterly adjustments are made based on the financial performance of a sub set (approximately 30) of Core Enterprise Application vendors.