HANOVER, GERMANY (02/18/2000) - Software AG today released final results for the fiscal year and fourth quarter ending Dec. 31, pointing to record levels in its income growth and better-than-expected results in spite of the year 2000 switch.
For the 1999 fiscal year, the German system software vendor's EBIT (earnings before interest and taxes) rose 46 percent to 116 million marks, up from 79.4 million marks in fiscal 1998. Net income rose 44 percent to 75 million marks or 2.88 marks per share, up from 52.2 million marks or 2 marks per share year on year, Software AG said in a statement.
Sales at the Darmstadt, Germany-based company rose 14 percent to total 715.6 million, up from 626.4 million marks the previous year. Software AG's three main business areas -- licenses, maintenance and professional services -- all strongly contributed to the results, Software AG said.
In 1999, Software AG also purchased five software services companies in Europe and the U.S., with a total of 400 employees, which will help it expand rapidly in the area of professional services, the company said.
Software AG invested 102 million marks in research and development, or 22 percent of its product revenues.
Regionally, the best results came from Germany and Spain. Asia-Pacific recovered from the previous year. U.S. sales partner SAGA Systems Inc., however, saw disappointing results. Software AG has now established its own separate U.S. company -- Software AG Inc. -- which operates separately from SAGA, its former U.S. subsidiary.
Software AG did not release detailed figures for its fourth quarter. It only reported that sales grew 15 percent to 211.4 million marks, and that pretax profits rose 49 percent over the fourth quarter the previous year to 43.5 million.
Looking ahead, Software AG is optimistic about prospects for Xenon, a set of products and services designed to help companies develop electronic business applications using the XML (Extensible Markup Language) format. [See "UPDATE:
Software AG Unveils Xenon," Jan. 18.] Parts of Xenon will be shipped in the third quarter.
Since January, Software AG has concluded partnerships with five companies, including California-based Santa Cruz Operation Inc. (SCO), to sell its XML-based technology to their customers. This will give the German company much-needed access to market segments outside its traditional customer base.
Software AG, in Darmstadt, can be reached at +49-6151-92-0 or on the Web at http://www.softwareag.com/.