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SAP delivered a highly disappointing set of results failing to meet the revenue expectations as well as the earnings expectations of Wall Street. The backlog in the cloud increased by 25% in the quarter which was a good sign. Also, revenue from the cloud increased by 22% from the previous quarter. The current cloud backlog and cloud revenue for S/4HANA increased by 79% which is why Q1 revenue increased by 9% overall. Furthermore, the company produced double-digit operating profit growth in Q1, u
Companies: SAP SE Sponsored ADR
Baptista Research
SAP delivered a mixed set of results in the final quarter of 2022 as it surpassed the revenue expectations of Wall Street but missed out on earnings. Despite the macroeconomic situation, 2022 was a decent year for SAP, highlighted by its cloud performance across all geographies. The company went ahead in increasing cloud revenue by 24%. Its cloud transformation is in full swing, with recurring revenue up to 79% in 2022. This year, cloud revenue also surpassed support revenue to become SAP's sing
This is our first report on SAP, the global ERP, market leader. The company delivered a mixed quarterly result as it managed to surpass Wall Street expectations on the revenue front with a strong double-digit cloud order entry growth but missed out on meeting earnings expectations. SAP’s performance in the North American and Latin American markets is particularly robust. Larger cloud transactions are becoming more common. The company’s cloud revenue has gradually become its largest revenue stre
SAP’s Q1 results were a mixed bag. While revenues were above consensus, profitability came in lower due to the impact of the Russia-Ukraine war. Nevertheless, the group reported better-than-expected momentum for its Cloud business. This was visible in the marked growth across all regions. The growth in S/4 HANA was also solid. Backed by these positives, the group is confident of making up for the negative impact from the war and confirmed its outlook.
Companies: SAP SE
AlphaValue
Throughout 2021, SAP continued to see an increasing shift towards cloud transition. The group’s ‘RISE with SAP’ programme continued to attract customers and S/4HANA showcased robust growth. These trends are expected to persist in 2022. Licensing revenues declined with a similar trend expected going forward. Operating profitability was lower than expected but the bottom line benefited from a strong contribution by Sapphire Ventures. The profitability target for 2022 is lower than expectations but
SAP, in Q3, built up on the traction seen in cloud transition in the previous quarter. SAP posted encouraging numbers as ‘Rise with SAP’ gathered further momentum and attracted new customers as well. S/4HANA also continued to attract customers as demand remained solid. Consequently, licence revenues declined. Similar to the previous quarter, the group once again raised its outlook up a notch. However, we see no monumental change to our estimates.
In Q2, SAP built on the good traction seen in its cloud transition through its Rise with SAP programme. This was visible in its current cloud backlog growth and cloud revenues. Licence revenues declined as expected. Good momentum was also seen in S/4 HANA and the group saw a general improvement in demand as reopening took place. After this release, the group raised its outlook albeit marginally. We will keep our recommendation unchanged.
SAP’s Q1 numbers were very similar to Q1 FY20’s in terms of revenues but lower in terms of operating profits. A clear positive, though, was the good traction in the group’s cloud business which was evident from the group’s current cloud backlog and cloud revenues. While it is still too early to call on 2025 plan, these developments are a good omen that SAP will be able to handle the transition well and deliver on its medium-term targets.
SAP’s Q4 figures showed a sequential improvement. They also helped it to surpass its revised FY20 guidance for revenue and achieve the high-end of the range in operating margins. FCF generation in particular was a positive and some ways ahead of the guidance. The group also put forward its FY21 outlook and reiterated its FY25 ambitions. The transformation will take time.
SAP’s Q3 results were average at best and missed our expectations. Consequently, the group not only lowered its FY20 guidance but also pushed its mid-term target out by two years from FY23 to FY25. These developments come as a result of two crucial mistakes: 1/being late to drive the push from licenses to cloud and 2/under-estimating how fast the transformation would occur, mostly aided by COVID. The result, a long road ahead to growth.
Companies: SAP SAP SAP SAP SAP 1SAP SAPGF
SAP today posted its final Q2 figures, confirming the preliminary results reported last week. The company raised its operating cash flow and FCF expectations for the year. It also announced the listing of Qualtrics, which it acquired in November 2018, while keeping a majority stake in the company, which looks logical given the synergies between both. All in all, this is positive news.
There were no major surprises in the figures compared to the pre-release in early April. The main surprise was the announcement regarding the departure of Jennifer Morgan, the co-CEO with Christian Klein, with the latter now taking over as sole CEO.
SAP’s 19Q4 results were mixed, though globally in line with consensus, with sales up +8% and a margin contraction of 590bp on an IFRS basis, while it expanded by 110bp on non-IFRS. It is always strange to observe such a difference trough in accounting methods. The cloud development quarter over quarter was also disappointing with a clear deceleration in new cloud bookings in relative terms. We remain unconvinced by SAP’s current equity story based on shifting from licences to cloud revenues.
As part of its Capital Markets Day, the SAP’s new team confirmed the mid-term targets (growth and margins) set earlier by the former CEO. While revenues of above €35bn and operating profit of c.€11.9bn by 2023 were both already known, the new target was on FCF, which is expected to grow by 15-25% per year and reach c.€8bn by 2023. The ambitions are there, but the execution will be more complicated in our view. We stick to our Reduce recommendation.
Europe clearly admits the domination of the cloud by the American majors. Independence is becoming increasingly urgent, especially since the Trump administration signed the Cloud Act in 2018, allowing it to ask American companies to deliver their customers’ data, including those stored outside the US. The German project, called Gaia-X, aims to create a European legal framework necessary for the development of a European cloud. Although the European Commission supports the initiative, it remains
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Made Tech has won a material expansion (worth up to £19.5m/2yrs) with a long-standing customer, The Department for Levelling Up, Housing and Communities (“DLUHC”). Coming off the back of a soft H1 bookings performance, we expect this win to materially boost investor sentiment and reassure how notwithstanding a tough backdrop (given an impending general election) MTEC continues to outcompete legacy providers and in-so-doing, grow its share of wallet with large/strategic customers. Landing near FY
Companies: Made Tech Group PLC
Singer Capital Markets
Eleco’s FY23 results show robust organic recurring revenue growth of +17% with recurring revenue +22% to £20.7m, adj EBITDA +2% ahead of the January update, and a confident outlook with Q1 ARR already at £24.5m vs £22.6m at FY23. At this point, the excellent start to FY24 leads us to reiterate our FY24-26E revenue, adj EBITDA, EFCF, and DPS, and we include the April 2024 acquisition of Vertical Digital in our FY24-26E net cash, as we explain below. As Eleco builds upon the successful acquisition
Companies: Eleco Plc
Cavendish
Companies: Cerillion Plc
Liberum
Cerillion has announced a very solid update, as H1 sales and EBITDA are both up 10% y/y to £22.5m and £10.9m respectively, notwithstanding the exceptionally strong base period (sales and EBITDA +27% and +38% resp.). Results therefore point to continued strong customer demand, reflecting how Cerillion’s out-of-the-box product continues to resonate and gain adoption, particularly in a ‘budget conscious’ environment, by offering faster time to market, greater configurability and at a lower cost. Me
As reported in March, underlying EBITDA profitability improved to record levels despite FX headwinds. Further platform and proposition developments were completed, key steps on its digital roadmap, and it has already won 7 contracts YTD. Alongside planned growth in private membership, this will at least offset the loss of one contract. Forecasts are left unchanged today and, as member engagement throttles back up, FX headwinds ease, and proof points of digital efficiency emerge, markets should b
Companies: Ten Lifestyle Group PLC
itim is a disruptive SaaS-based platform that enables store-based retailers to implement a proven Omni-channel solution. This morning, the group has announced an additional professional services contract with its long-standing client, The Entertainer. Following a year-long trial, The Entertainer is opening in over 800 Tesco stores across the UK & Ireland, alongside a supplier agreement for Tesco stores across Central Europe. Under the contract, The Entertainer will extend its use of itim's Unify
Companies: Itim Group PLC
WHIreland
GE Healthcare has announced the launch of the Voluson Signature 20 and 18 ultrasound systems, with the related press release noting these systems ‘comprehensively integrate artificial intelligence’ to improve the ultrasound procedure for clinicians and the women being scanned. These ultrasound systems include SonoLyst, the AI which incorporates Intelligent Ultrasound’s ScanNav Assist and ScanNav AutoCapture AI software. The launch of additional Voluson systems including the SonoLyst suite of AI
Companies: Intelligent Ultrasound Group Plc
22nd April 2024 * A corporate client of Hybridan LLP ** Arranged by type of listing and date of announcement *** Alphabetically arranged **** Potential means Intention to Float (ITF) has been announced Dish of the day Admissions: Delistings: What’s baking in the oven? ** Potential**** Initial Public Offerings: Reverse Takeovers: 16 April 2024: Electric Guitar (ELEG.L) Concurrent with its Admission to trading on AIM, Electric Guitar is proposing to acquire the entire issued share capital of 3radi
Companies: ARV CTL AFRN FEN HUW TENG BBSN EAAS VAL
Hybridan
Alphawave Semi has reduced guidance for FY23 and prospectively citing lower revenues from China, changes in expected revenue recognition from long-term contracts, and continuing investment in R&D. The share price has reacted negatively, giving up most of the gains since the trading statement at the end of January. Current consensus, which is a good match for pre-existing guidance, should be reduced, most likely following release of the FY23 results and full 1Q24 trading update due on 23 April. H
Companies: Alphawave IP Group PLC
Capital Access Group
Companies: FOG PEB KBT EMR TIME GETB JNEO
Devolver Digital encouragingly delivered 2023 results slightly ahead of expectations and provided a steady medium-term outlook that leads us to reiterate our 2024 Adjusted EBITDA estimates. Longer term, the company is now planning to further develop its two major planned titles, Human Fall Flat 2 and System Era's next major new release. We now expect those major titles to be released in 2026 rather than 2025, meaning we lower our 2025 Adjusted EBITDA forecast to $10.6m from $17.6m but introduce
Companies: Devolver Digital, Inc.
Zeus Capital
This report is intended to help UK small- and mid-cap investors gain a better understanding of software companies’ routes to market, and to highlight how one of the most important facets of the way in which they grow and deliver value is routinely ignored. We examine sales processes for six UK-listed companies and one that has recently been taken over, and consider why they have followed their respective paths.
Companies: Idox plc
Progressive Equity Research
Banquet Buffet*** Abingdon Health 9.25p £11.3m (ABDX.L) The lateral flow contract development and manufacturing organisation announces its unaudited interim results for the six months ended 31 December 2023. Revenue increased 117% to £2.4m (H1 2023: £1.1m). The Adjusted EBITDA loss decreased 47% to £1.2m (H1 2023: £2.2m). Furthermore, reduction in operating loss of 50% to £1.2m (H1 2023: £2.4m). The Board therefore expects that H2 2024 revenue will be significantly improved compared with H1 2024
Companies: CPX SLP FA/ FIPP ECR ETP ORCA
Companies: IGP RUA BOOM
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