Commerzbank Sector Conference - Technology, Media & Telecoms - August 29, 2012 Arnd Zinnhardt, CFO
August 29, 2012 2 Safe-Harbor-Statement This presentation contains forward-looking statements based on 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.
August 29, 2012 3 Software AG Track Record 1.200 1.000 800 600 400 200 0 Total revenue ( m) 1,098 411 2004 2011 200 180 160 140 120 100 80 60 40 20 0 24 2004 FCF ( m) 188 2011 2,5 EPS ( ) 0,6 Dividend ( ) 2,0 1,5 2.05 0,4 0.46 1,0 0,5 0,0 0.65 0,2 0,0 0.25 2004 2011 2004 2011
August 29, 2012 4 Revenue Split Well Balanced Product Revenue by Region* Product Revenue by Industry** PIIGS < 4% 13% 8% 45% Retail Transport & Logistics Telecos Others 21% Financial Sector 33% Manufacturing 20% Public Sector Associations BRICS 13% IT Americas EMEA (ex Germany) Germany Asia Pacific *Based on product revenue (H1 2012) / **Q2 2012
August 29, 2012 5 Q2 2012 Actual versus Expectation (yoy in %) BPE ETS IDSC Total revenue (in m) Consensus (pre Q2; in m) Licenses +46% +20%... 76.0 65.2 Maintenance +16% -1%... 99.5 96.6 Product revenue +29% +6%... 175.5 161.8 Services & other -21% +4% -32% 83.1 98.4 Total revenue +9% +6% -31% 258.6 260.9
August 29, 2012 6 Outlook FY 2012 (in m) 2011 Outlook 2012 (as of July 24, 2012) H1 2012 Product Revenue Group 673.9 +2% to +7%* +3.4%* Total Revenue BPE 527.9 +5% to +15%* +1.1%* Total Revenue ETS 381.3-6% to -3%* -0.7%* EBIT Margin 24.5% 23.0% to 24.5% 21.8% * Net of currency, yoy
Business Lines - Cash Cow feeds Star - Star leads Cash Cow
August 29, 2012 8 Revenue by Business Line (Segment) Traditional Business (started 1970) Data Management (ADABAS) Application Modernization (Natural) 37% ETS 13% IDSC 50% BPE New Business (started 2004) Integration Technology Business Process Management (BPM) Real time BI SAP Consulting (acquired 2009 with IDS Scheer Group) (Revenue split based on H1 2012)
August 29, 2012 9 BPE New Business Outgrowing Revenue from Traditional Business (Revenue in m) Business Process Excellence Enterprise Transaction Systems 600 500 499 528 400 357 383 405 396 316 372 420 381 300 238 200 126 100 0 2006 2007 2008 2009 2010 2011
August 29, 2012 10 Transformation of Revenue Drivers 1bn ca. 45% ca. 70% New Business Organic Growth BPE Integration Technology Business Process Management Cloud Terracotta / Big Data Partner / Indirect Sales M&A / Strategic Acquisitions ca. 37% ca. 20% Traditional Business Data Management (ETS) ca. 18% ca. 10% SAP Consulting (IDSC) 2010 2015 Revenue split as % of Total Revenue 2015: according to mid-term plan
Strategy based on Technology
August 29, 2012 12 Growth Strategy Growth based on three pillars Organic Growth leverage technology leadership in enterprise infrastructure software Fast integration middleware High speed process automation High performance data management Innovation addressing Mega Trends for enterprise IT Cloud Big Data Mobile Collaboration Selective M&A in related business segments, e.g. Data Management Process Automation Analytics
August 29, 2012 13 Innovation through own R&D as well as Acquisitions 26% 26% 24% 27% Strategic Acquisitions 22% 22% 19% 18% 2009 2010 2011 2012 9% 9% 9% 8% 2007 2008 2008 2009 2010 BPE R&D cost + amortization of acquired IPR/products in % of product revenue 2011 BPE R&D cost (all expensed) ETS R&D cost (all expensed) Technology Tuck Ins
August 29, 2012 14 Top-ranked Technology Leader in All Major Segments BPMS SOA Governance Application Integration SOA Infrastructure Business Process Analysis Enterprise Architecture Tools B2B Gateway Comprehensive Integration Solutions BPMS ESB EA Management Suites Integrated SOA Governance SOA Service Life-cycle Management Elastic Caching Platforms
Innovation for IT Megatrends August 29, 2012 15
August 29, 2012 16 Terracotta: Innovation Big Data & In-Memory Without BigMemory With BigMemory Data in Database Memory Speed up Save Costs Data In Memory Database SLOW 100x FASTER than retrieving data from database SCALEABLE capacity for terabytes of data and 100,000s of transactions per second EXPENSIVE COMPLEX COST REDUCTION maximize utilization of RAM and reduce load on database SIMPLE to deploy, easy to install, plug & play HIGH PERFORMING - lower latency enables higher throughput and boost high volume transactions REALTIME access to business critical data in microseconds enables new business models
Thank you Please contact: Investor Relations Uhlandstrasse 12 64297 Darmstadt Germany phone: +49 (0) 6151 / 92-3046 fax: +49 (0) 6151 / 92-1933 web: softwareag.com e-mail: investor.relations@softwareag.com