Dr. Werner Brandt CFO and Member of the Executive Board, SAP AG
Cheuvreux 10th German Corporate Conference Frankfurt, January 17, 2011
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Î SAP at a Glance
SAP's Strategy: Expanding the Addressable Market
SAP's Product Strategy
Snapshot: Q4 & FY 2010 Preliminary Results
Summary
SAP at a Glance – Executive Summary
- Ŷ SAP is the undisputed market leader in enterprise business applications software
- Ŷ 105,000+ customers in 120 countries around the world
- Ŷ €12.5bn total revenue
- Ŷ 31%+ operating margin
- Ŷ Leading vertical strategy with more than 24 industry-specific solutions
- Ŷ Leader in large, midsized and small enterprise segments with tremendous growth opportunities in each segment
- Ŷ Unique ability to deliver to its customers software solutions on premise, on demand and on device all seamlessly integrated
SAP's Business Model Defensive Characteristics and Significant Growth Potential
© 2011 SAP AG. All rights reserved. / Page 5
SAP at a Glance
Î SAP's Strategy: Expanding the Addressable Market
SAP's Product Strategy
Snapshot: Q4 & FY 2010 Preliminary Results
Summary
SAP Accelerates the Expansion of its Addressable Market
Expansion of SAP's Addressable Market
- Expansion of addressable market due to:
- market growth within SAP's established solution categories
- addition of new solution categories 2
- With the acquisition of Sybase and the launch of OnDemand solutions and In-Memory Computing, SAP accelerates the expansion of its addressable market
Expanding SAP's Addressable Market Cloud Computing / On Demand
Integrated On-demand Suite for Small and Midsized Enterprises
- SAP Business ByDesign is a complete ondemand suite based on industry-leading architecture
- Available in six major countries since beginning of August (Feature Pack 2.5)
- Core to SAP's on-demand strategy
Line of Business Solutions for Large Enterprises
- Aimed at areas most suitable for on-demand extensions to an on-premise core, e.g.:
- Î Customer Relationship Management
- Î Expense Management
- Î Talent Management
- Î Carbon Management
- Seamless integration with on-premise SAP Business Suite
Expanding SAP's Addressable Market In-Memory Computing: Potential to Revolutionize Data Storage and Access
- The SAP in-memory computing engine is an integrated database and calculation layer that allows the processing of massive quantities of real-time data to provide immediate results:
- 100x 1,000x faster than traditional data processing
- Data is stored in-memory rather than on hard disk
- SAP launched its first product with in-memory technology (SAP HANA 1.0) in Dec. 2010. It demonstrates fundamental improvements in:
- Speed: Columnar storage of data enables breakthrough performance in scan, grouping and aggregation operations that are the heart of analytics
- Scalability: Performance scales linearly by the number of cores per blade
- Compression: SAP's technology employs advanced compression algorithms and data structures that minimize the memory footprint required to run the system
Expanding SAP's Addressable Market Mobile Solutions / On Device
- Make SAP solutions available on a broad number of devices
- Access SAP anytime and anywhere
- Based on Sybase's leading mobile solutions portfolio
- ~60% of world's population on Mobile already, more than 1 billion mobile workers globally as of today
- Corporate applications accessed from mobile devices growing at >40% p.a.
SAP at a Glance
SAP's Strategy: Expanding the Addressable Market
Î SAP's Product Strategy
Snapshot: Q4 & FY 2010 Preliminary Results
Summary
SAP's Product Strategy is a Reflection of its Market Expansion Strategy
On Premise: The Foundation of SAP's Business Innovation without Disruption & Lowest TCO in the Market
SAP Business Suite 7.0
- SAP's flagship product
- New modular, reduced-risk IT approach enables further TCO reduction for customers
- Enhancement package strategy: Win-win for customers and SAP
- Expanded industry specific footprint
- Embedded analytics tools
- Improved Usability (Mobile)
Analytics
- Comprehensive analytics suite
- Strategic New Categories
- New solutions outside the suite, e.g. transportation management, banking solution, etc.
- Advantages:
- Independent release cycle (cheaper and easier to maintain)
- Stand-alone is possible and easy integration is guaranteed
In-Memory Technology / HANA
Breakthrough data management
On Demand: Lowest Time to Value Integrated to On Premise & Most Modern Platform
SAP Business ByDesign
- Six country versions available
- Subsidiary scenario
- New database (In-memory technology)
- On Demand platform convergence
LoB on Demand: People-Centric Apps
- Today already available: E-Sourcing, Carbon On Demand (OD)
- In 2011: Sales OD, Travel OD, Career OD
- Mobile consumption
- People centric design
- Collaborative in nature
On Device: Ease of Building Mobile Experiences and … … Ecosystem Innovation
Sybase 365 (Mobile Infrastructure)
- Helps to manage and operate a mobile infrastructure
- Enables mobile devices to execute business processes (e.g. mobile commerce)
Sybase Unwired Platform (Mobile Platform)
- The Sybase "Unwired Platform" allows SAP to bring enterprise applications to a broad range of mobile devices quickly and efficiently
- Manages the complexity of devices (e.g. devices that are "always on" or "sometimes on")
SAP Mobile & Ecosystem
The Sybase unwired platform is the opportunity to build mobile experiences for SAP (e.g. CRM running on an iPad), but also for SAP's partner ecosystem
Orchestration – Consistency, Lowest Cost & Customer Choice
Networked Solutions
SAP's blueprint of how to built a piece of software to make sure that all pieces fit together seamlessly
Built-in Orchestration
- SAP NetWeaver is the technology platform that runs all SAP applications
- It enables consistency across master data, systems to manage and takes customer experience to the next level
- Integration Out of the Box
Leveraging Sybase's Assets and Expertise
Leading Mobile Platform 1
- Sybase is the global leader in mobile application platforms and mobile device management
- "Make SAP available anytime, anywhere, for everyone"
Data Management and Analytics 2
- Sybase is a leading provider of high-performance databases in focus industries like financial services and telecommunications (Sybase ASE, Sybase IQ)
- Sybase databases will support SAP applications and get combined with the SAP Business Objects analytical front-end
In-Memory Technology 3
- Sybase's expertise in data storage, administration and security as well as its customer base enable SAP to shorten time-to-market for SAP's breakthrough In-Memory Technology
- In-Memory Technology facilitates real-time analytics and next-generation applications for on-premise and on-demand platforms
SAP at a Glance
SAP's Strategy: Expanding the Addressable Market
SAP's Product Strategy
Î Snapshot: Q4 & FY 2010 Preliminary Results Summary
Selected Income Statement Items – Overview Q4 & FY 2010 (Preliminary)
SAP announced record fourth quarter 2010 software revenue
- Full-year SSRS revenue increased 13% at const. curr. and exceeded company guidance
- Fourth quarter software revenue increased 24% at const. curr. to approx. €1.5bn
4th
Quarter 2010 Performance (all numbers are approximate) |
|
|
|
|
| Software revenue (IFRS) |
€1.50bn |
+34% |
+24%* |
|
| SSRS revenue (Non-IFRS) |
€3.30bn |
+28% |
+20%* |
|
| Total revenue (Non-IFRS) |
€4.08bn |
+28% |
+19%* |
|
| Operating margin (Non-IFRS) |
39% |
+4pp |
+3pp* |
|
Full Year 2010 Performance (all numbers are approximate)
| Software revenue (IFRS) |
€3.26bn |
+25% |
+16%* |
|
| SSRS revenue (Non-IFRS) |
€9.85bn |
+20% |
+13%* |
|
| Total revenue (Non-IFRS) |
€12.52bn |
+17% |
+11%* |
|
| Operating margin (Non-IFRS) |
31.5% |
+4pp |
+3pp* |
|
* at constant currency
|
FY 2010 – Performance vs. Guidance |
|
|
SAP's Outlook*
FY 2010 |
Actual Performance
FY 2010 |
Software and
Software Related
Service Revenue
(Non-IFRS) |
Increase in a range of
9% – 11%
at constant currencies |
9
Increase of ~13%
at constant currencies |
Operating
Margin
(Non-IFRS) |
Range of 30% – 31%
at constant currencies |
9
~30.5%
at constant currencies |
* Status as of Q3 2010
© 2011 SAP AG. All rights reserved. / Page 20 |
|
|
SAP at a Glance
SAP's Strategy: Expanding the Addressable Market
SAP's Product Strategy
Snapshot: Q4 & FY 2010 Preliminary Results
Î Summary
Summary
- SAP is the clear market leader in the enterprise business applications industry
- Strong growth opportunities supported by a sustainable, robust, long term business model
- Diversified revenue streams across geographies, industries and customer segments
- SAP's aspiration for further margin expansion
- Highly skilled workforce
- Excellent reputation and brand recognition