Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on SAP SE. We currently have 13 research reports from 1 professional analysts.
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In line with expectations but costs are out of control
21 Oct 16
The company reported third quarter results. Total revenues increased 7.8% to €5.38bn. Cloud subscription & support revenues grew 28.4% to €769m. We estimated an increase of 31.2% to €786m and the market around €787m. New cloud bookings (order entry) increased 24% to €265m. Software licence revenues grew 2% to €1.04bn (our estimate +3.5% to €1.04bn). Maintenance revenues increased surprisingly strong by 5.7% to €2.65bn (estimate: 2.2% to €2.56bn). EBIT, however, dropped by 9% to €1.1bn. We expected an EBIT increase of 10.5% to €1.3bn. Net income dropped 19% to €730m (estimate: +6.3% to €955m). Cloud subscription and support revenues grew 34% from €136m to €182m in the EMEA region, and were especially strong in Germany, France and the UK. In the Americas, cloud revenues increased 24% to €508m, and in Asia Pacific around 52% to €78m. In the third quarter, the company added 400 new SAP S/4 HANA customers (+40%). Around 4,100 customers are now using this cloud platform.
No read-through for SAP
01 Sep 16
Salesforce reported second quarter results ending in July. Revenues increased 25% to US$2.04bn. EBIT jumped 64.2% to US$32.5m and the EBIT margin improved from 1.2% to 1.6%. From an earnings perspective, the company is not really visible. Net income, however, jumped from a small loss to US$229.3m. Around US$205.3m was related to a tax benefit as a result of the release of a portion of the valuation allowance related to the acquisition of Demandware. Salesforce.com acquired Demandware for a total of US$2.6bn and was also bidding for Linkedin which was bought by Microsoft for a total of US$26.2bn. GAAP income turned from a loss of US$0.85m to a profit of US$229.6m. Non-GAAP related income increased 32.9% to US$170.4m or US$0.24 per share. This includes amortisation of purchased intangibles, share-based compensation and other unpleasant cost items. Business in the Americas contributed 73% to revenues, Europe 17% and Asia Pacific 10%. Management experienced some weaker demand at the end of the second quarter but still raised the full-year revenue guidance range to between US$8,275m and US$8,325m.
The world is not enough!
20 Jul 16
SAP reported a strong operating performance in Q2 16. Total revenues increased 5.4% to €5.2bn (our estimate: €5.3bn). Cloud revenues grew by 30.4% to €720m (our estimate: €722m). EBIT jumped 79.2% to €1.16bn which was also in line with our expectations. Our EBIT definition, however, differs from the company’s reported EBIT. We use IFRS numbers and include other operating expenses/income which is not part of the SAP calculation. Despite the strong cloud business, licence revenues grew by 6.2% to €1.04bn and maintenance revenues 2.6% to €2.6bn.
Times are changing
13 May 16
At the AGM, the shareholders approved the new compensation system for the executive board starting in 2016. The approval, however, was not so well explained as it should have been. Around 66.1% of the total capital or 812m shares/votes attended the AGM. Around 45.31% was against the new compensation system and 54.69% of the shareholders agreed. This is not a SAP-style approval. Nearly every topic on the agenda was approved by at least 95% of the attending shareholders or even more in the past. The good old days are over.
Licence growth below expectations
21 Apr 16
SAP reported final Q1 16 results. Revenues increased 5.1% to €4.72bn. The operating profit jumped 59% to €778m and the real EBIT margin increased from 10.9% to 16.5%. Total adjustments were reduced from €413m by €123m to €290m due to lower share-based payment expenses. In addition, the company faced additional non-operational expenses of €35m compared to €148m in Q1 15. These so-called non-operational expenses, mainly foreign currency exchange gains/losses, are excluded from SAP’s EBIT calculation. Total revenues in Germany increased 8%, in EMEA 5%, in the USA 10% but declined 7% in the rest of the Americas mainly in Brazil. Revenues in Asia Pacific remained stable, but increased 9% in Japan and declined 2% in other regions. According to management, business in China was the highlight with double-digit software revenue growth. Total cloud subscription and support revenues grew 35% to €677m; in EMEA 49%; 31% in the Americas and 27% in Asia Pacific. For SAP, the Americas are the largest cloud market with a total volume of €460m or 68% of total cloud revenues in Q1 16.
Cloud revenues up 33%, licence revenues down 12.4%!
11 Apr 16
The company reported preliminary Q1 16 results. Cloud subscriptions and support revenues increased 35.2% to €680m. Software support grew 4.3% to €2.56bn and licence revenues declined 12.4% to €610m. Real EBIT according to our definition grew 65.5% to €810m. The EBIT margin jumped from 10.9% to 17.1%. Net earnings per share grew 39% to €0.48 compared to €0.35 in Q1 15. According to management, business in Europe and Asia Pacific was solid. Business in Brazil suffered from economic uncertainties and business in North America experienced a slower start due to a strong fourth quarter.
Taking a prudent road
28 Nov 16
As flagged in September, H1 2017 profit is indeed below LY; adj. PBT of £0.5m compares with £1.5m in H1 2016 as Trakm8 invests heavily in new technology and acquisition integration. Management remains confident in another very strong H2 performance and in particular is focused on closing a couple of large high-margin software-related sales which would see the group meeting the original FY 2017 expectations of £5.9m adj. PBT. However, should these fall outside the March year-end, profits are only likely to be in line with last year’s £3.9m, albeit on a growing revenue base. Prudence dictates we assume a worst-case scenario in our forecasts so that surprise is only in the upside – if the deals close in the year, the company will meet those original revenue and profit expectations.
N+1 Singer - Morning Song 30-11-2016
30 Nov 16
Sanderson has delivered full year results in line with expectations and the 19 October trading update after a strong finish to the year compensated for a slower start. A healthy level of pre-contracted recurring revenue (50%), incremental sales to existing customers and new customer wins at higher average order values helped deliver solid revenue growth in both the Digital Retail (+9%) and Enterprise (+12%) divisions. A decent order book and good sales momentum suggest that the company is on track to deliver on unchanged profit expectations for the current year. We continue to view the valuation (FY17 EV/EBITDA 8.6x) as undemanding given an attractive combination of accelerating growth potential, strong cash generation and growing dividends.
N+1 Singer - Eckoh - In line interims, US secure payments gathers pace
29 Nov 16
Eckoh delivered interims in-line with expectations. UK growth was 11% whilst the US, reflecting a full period for PSS now accounts for 30% of sales. US Secure Payments wins gathered pace, with much larger contracts being won on SaaS-style pricing models and the pipeline at record levels. With contracts won in the first half feeding through strongly into the second half and given the group’s high level of recurring revenues (76%), the outlook remains positive for the rest of the year and we make no changes to forecasts. Eckoh has exceptional growth opportunities, particularly in the US, and we believe it can convert this to strong shareholder value.
N+1 Singer - Morning Song 05-12-2016
05 Dec 16
RTHM is acquiring a profitable Canadian listed mobile specialist for equivalent of US$42.5m consideration in shares (88.235m). This helps adds to two growth vectors RTHM is targeting; (i) adds unique exclusive audience (10m unique) and (ii) Exclusive demand Yahoo and Facebook. The business has 15 premium and owned and operated apps which provide users with rewards for activity. The business is expected to deliver c$9m of EBITDA in FY18 including $2m of cost synergies. This equates to just 4.7x EV/EBITDA. This marks what we see the first step in RTHM activity to scale the business and deliver on margin potential (see our initiation notes). Our initial estimates for EPS revisions are very significant - for FY18 are 2.3 cents (currently 0.6) and for FY19 4.3 (currently 2.5). There is a call at 830 for investors and we will revise post this.
N+1 Singer - Morning Song 29-11-2016
29 Nov 16
Vp has reported another impressive set of interims, confirming strong growth in most markets and a positive outlook. Recent acquisitions are bedding in well and the full year outturn is set to exceed previous expectations (5%/6% EPS upgrades in FY17/FY18). The recent Capital Markets Day provided a reminder of Vp’s qualities (specialist focus, high returns, strong cash generation) and its growth potential, which in our view are not reflected in a modest <11x P/E rating. We firmly believe the shares are due a re-rating and see intrinsic value in excess of 800p.