CLOUD & SOFTWARE AG

Transcription

1 CLOUD & SOFTWARE AG THE NEW GROWTH DRIVER COMMERZBANK SECTOR CONFERENCE FRANKFURT, 30 AUGUST 2018

2 SAFE-HARBOR-STATEMENT This presentation includes forward-looking statements based on the beliefs of Software AG management. Such statements reflect current views of Software AG with respect to future events and results and are subject to risks and uncertainties. Actual results may vary materially from those projected here, due to factors including changes in general economic and business conditions, changes in currency exchange, the introduction of competing products, lack of market acceptance of new products, services or technologies and changes in business strategy. Software AG does not intend or assume any obligation to update these forward-looking statements. This presentation constitutes neither an offer nor recommendation to subscribe or buy in any other way securities of Software AG or any of the companies that are members of the Group at present or in the future, nor does it form part of such an offer and it should not be understood as such. This presentation does not constitute an offer of sale of securities in the United States of America. Securities may not be offered or sold in the United States of America without registration or exemption from registration in accordance with the U.S. Securities Act of 1933 in its currently valid form. 2

3 SOFTWARE AG AT A GLANCE Technology leader for more than 40 years in data management and application development platforms 870+ MILLION IN REVENUE 50%+ recurring 75% product revenue 41% Americas 51% EMEA BY REGION* REVENUE 26% A&N 23% Services 51% DBP BY BUSINESS LINES* 4,500+ EMPLOYEES** Consulting &Services 42% Admin 13% R&D 26% S&M 19% ~ 3bn MARKETCAP ~ 66% Free Float * Based on Group product revenue FY 2017 **P&L as of December 31,

4 BUSINESS LINES IoT and Industry 4.0 Platforms Integration & Automation Analytics & Decisions In-Memory Data Business & IT Transformation Application Development Data Management System Modernization System Support Strategy & Design Product Implementation & Customized Solutions Education & Cloud Services Global Delivery (on-/offshore) Growing Revenue Growing Stability Growing Margin Share of Revenue* 52% Share of Revenue* Share of 25% 23% Revenue* *Group revenue split FY

5 2018 TURNING POINT / DIGITAL BUSINESS DRIVING GROWTH 100% License Revenue 100% Maintenance Revenue 80% % % 60% 40% 40% 20% 20% 0% 0% 100% Segment Result 80% 60% 40% 20% 0% 2018e Digital Business Platform Adabas & Natural 5

6 DATA CENTERED ERA REQUIRES SOFTWARE CENTRICITY Entering the next computing cycle which is centered on data Source: Morgan Stanley Research, The Data Era Becomes Investable, April 9, 2018 Source: Bain & Company, 2017 Software AG is ready to reap proceeds from higher IT investments by providing a comprehensive workbench along the IT value chain. Software AG has singled out a distinct area of growth in (industrial) IoT to leverage its capabilities. 6

7 SOFTWARE AG IOT PLATFORM CAPABILITES ACQUISITIONS TO CATER THE IOT NEEDS IoT Acquisitions Strategic decision for IoT Big Data & Streaming Analytics Machine Learning Device Connectivity Time-series Analytics Artificial Intelligence Edge Computing 7

8 ESSENTIAL CAPABILITIES TO SUCCEED IN IOT Artificial Intelligence Big Data & Streaming Analytics Edge Computing IoT Machine Learning Device Connectivity Time-series Analytics 8

9 DIGITAL BUSINESS PLATFORM (DBP) & IOT EVOLUTION CREATING NEW DIGITAL BUSINESS IN REAL TIME ECONOMY DBP Connect business data & logic I ot Connect device & production process data Apply real-time analytics Build new digital business models (algorithms) Create new digital enterprise Software AG. All rights reserved.

10 MARKET AWARENESS OF LEADERSHIP IS BUILDING UP BEST IOT TECHNOLOGY PARTNER IN THE MARKET The Forrester Wave : HYBRID INTEGRATION (SAG WebMethods) Gartner Magic Quadrant: Full Life Cycle API Management The Forrester Wave : STREAMING ANALYTICS (SAG Apama) IoT Solutions (SAG Cumulocity*) Source: Gartner, Inc., Magic Quadrant for Full Life Cycle API Management, Paolo Malinverno, Mark O Neill., April 30, 2018 This graphic was published by Gartner, Inc. as part of a larger research document and should be evaluated in the context of the entire document. The Gartner document is available upon request from Software AG. Gartner does not endorse any vendor, product or service depicted in its research publications, and does not advise technology users to select only those vendors with the highest ratings or other designation. Gartner research publications consist of the opinions of Gartner's research organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose. *Cumulocity is the IoT solution portfolio of Software AG encompassing Hybrid Integration, In-Memory Computing and Streaming Analytics 10

11 DIGITAL BUSINESS PLATFORM & IOT GTM / DISTRIBUTION CHANNELS Direct Cloud OEM Project based Product Sales and Upgrades Standardized / Use Case Product Offerings (e.g. ARIS & Alfabet) Sales Scale with Partner Platform or Solution Software AG. All rights reserved.

12 CUSTOMER BASE IS MATCHING IOT GROWTH SECTORS IoT Demand by Sector ( ) Software AG Customer by Sector (Product Revenue 2017) 12% 5% 4% 20% 10% 12% 18% 19% Government IT Services Services Transp. & Log. Financial Services Manufacturing Telco & Media Other 12

13 SOFTWARE AG S SUCCESS STORIES IN IOT IOT ECOSYSTEMS INDUSTRY 4.0, TELCOS, AUTOMOTIVE, JV of leading machinery manufactures: DMG MORI, DUERR, ZEISS, ASM, ENGEL, KARL MAYER Transforming auto insurance through behavioral, contextual and driving analytics Strengthening Mindsphere platform across industries enabling powerful industry applications Enabling customers to use geo-sensing alerts, reduce theft and anticipate maintenance needs Leveraging Bosch IoT Cloud platform with Realtime predictive analytics technology KPN (NL), Telstra (AUS), Telia (SWE), Reliance Communications (India), NTT (Japan), Deutsche Telekom (T-Systems), Nokia or Huawei. 13

14 SOFTWARE AG S OPEN IoT ECOSYSTEM OVERVIEW Technology & Analytics Hardware & Devices System Integrator Consortia & Alliances Value-added reseller Infrastructure & Connectivity Software AG. All rights reserved.

15 OUTLOOK FULL YEAR 2018 FY 2017 (in m) FY 2018 Outlook (as of April 13, 2018) DBP Total Revenue - DBP (excl. Cloud & IoT) - DBP Cloud & IoT N/A % to +7% 1) % to +135% 1) Adabas & Natural Operating Margin Group (EBITA non-ifrs) 2) EPS non-ifrs 3) % % to -2% 1) 30% to 32% +5% to +15% 1) At constant currency rates 2) Adjusted for non-operating items (see non-ifrs earnings results) 3) Weighted average shares outstanding (basic/ias 33.19) FY 2017: 74.6m / H1 2018: 74.0m; based on new US-Federal-Tax and Euro/US-Dollar exchange rate of 1/

16 FINANCIAL DATA KEY FIGURES in m, IFRS H H Δ FY 2017 FY 2016 Δ Total Revenue %* %* BL DBP (including Cloud & IoT) %* %* Thereof Cloud & IoT %* 14.9 N/A N/A BL A&N %* %* BL Consulting %* %* Annual Recurring Revenue (Cloud & IoT) %* 14.8** N/A N/A EBIT % % EBITA (non-ifrs) % % EPS (in, non-ifrs) % % Dividend per share % Free cash flow % % Operating Margin Group (EBITA non-ifrs) 28.7% 28.4% 30bps 31.8% 31.2% 60bps Shareholders equity ratio 59.4% 58.7% 70bps 58.6% 61.1% -250bps *At constant currency ** at internal FX plan rate

17 ARR ANNUAL RECURRING REVENUE COMPONENTS AND DEFINITION Term- / Subscription License Rented on-premises software (Term / Subscription) is installed on systems of the customer and customer takes possession of the software Even though IFRS 15 provides upfront License Revenue Recognition - for ARR purposes the respective monthly / quarterly pro-rata amount will be used due to its recurring character Maintenance Maintenance from Perpetual and Term-/ Subscription contracts recognized for the respective period net of one-time effects Software as a Service (SaaS) Revenue from Software as a Service contracts including License, Maintenance and Hosting components net of one-time effects Usage Based Revenues from software usage (measured by number of connected devices, exchanged data volume etc.) in a given period of time Definition: ARR = Total Conctract Value (TCV) of active contracts at period end divided by contract duration in months, times

18 ARR DBP CLOUD & IoT DEVELOPMENT STATUS JUNE 30, 2018 in m %** Subscription License Maintenance SaaS 0 Apr Q1 30, 2017 Jun Q2 30, 2017 Sept Q3 30, 2017 Dec Q4 31, 2017 Apr Q1 30, 2018 Jun Q2 30, 2018 * Net of currency (based on prior year rates) ** vs. previous quarter status 18

19 Investor Relations Uhlandstrasse Darmstadt Germany T: +49 (0) 6151 / F: +49 (0) 6151 / W: softwareag.com E: investor.relations@softwareag.com 19