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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
For the periods ended September 30, 1998
SAP AKTIENGESELLSCHAFT SYSTEME,
ANWENDUNGEN, PRODUKTE IN DER DATENVERARBEITUNG
(Exact name of registrant as specified in its charter)
SAP CORPORATION
SYSTEMS, APPLICATIONS AND PRODUCTS IN DATA PROCESSING
(Translation of registrant's name into English)
NeurottstraBe 16
69190 Walldorf
Federal Republic of Germany
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F.
Form 20-F [X] Form 40-F [ ]
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes [ ] No [X]
If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b): 82-_______.
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SAP AKTIENGESELLSCHAFT
SYSTEME, ANWENDUNGEN, PRODUKTE IN DER DATENVERARBEITUNG
FORM 6-K
SAP Aktiengesellschaft Systeme, Anwendungen, Produkte in der
Datenverarbeitung, a stock corporation organized under the laws of the Federal
Republic of Germany, issued a press release dated October 20, 1998 (the "Press
Release") announcing financial information for the first nine months of 1998 and
certain product developments and initiatives. The Press Release is attached as
Exhibit 99.1 hereto and is incorporated by reference herein.
Exhibits
Exhibit No. Exhibit
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99.1 Press Release, dated
October 20, 1998
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
SAP AKTIENGESELLSCHAFT SYSTEME,
ANWENDUNGEN, PRODUKTE IN DER
DATENVERARBEITUNG
(Registrant)
By: /s/ Henning Kagermann
----------------------------------
Name: Prof. Dr. Henning Kagermann
Title: Member of the Board
By: /s/ Michael Junge
--------------------------------
Name: Michael Junge
Title: Head of Legal Dpt.
Date: October 26, 1998
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Exhibit Index
Exhibit No. Exhibit
- ----------- -------
99.1 Press Release, dated
October 20, 1998
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PRESS
INFORMATION
FOR IMMEDIATE RELEASE
Contact: Kevin S. McKay
SAP America
+1-610-355-4060
-or-
Michael Pfister
SAP AG
+49-6227-74-1758
-or-
Richard Taylor
Taylor Rafferty Associates
+44-171-606-1149
SAP 1998 NINE MONTHS SALES INCREASE 54% TO DM 5.9 BILLION
Walldorf, Germany, October 20, 1998 -- SAP AG, the world's leading provider of
enterprise business software, announced today that its strong growth continued
as planned in the third quarter of 1998. Revenue in the third quarter grew to DM
2.0 billion, an increase of 43% over the same period last year. Including a DM 9
million expense provision related to SAP's employee stock appreciation rights
(STAR) program, costs rose 46% to DM 1.7 billion. Pretax profits increased 50%
to DM 376 million in the third quarter. In the first nine months, revenues grew
54% to DM 5.9 billion, while pretax profits grew 45% to DM 1.2 billion.
SAP's strong performance in the period is mainly attributable to the continued
favorable market response to its products, supported by unequalled customer
commitment and rapid implementation. The company extended its record of rapid
growth despite the ongoing economic crisis in Japan and unfavorable exchange
rate trends. Compared to the very strong performance the company achieved in the
fourth quarter last year, the SAP Board is expecting growth to slow in the
fourth quarter this year. The Group expects some moderation of demand due to
year 2000 issues. "Against this background we are confident of our earlier
expectations that we will be able to grow pretax profits for the current year,
excluding provisions for the STAR program, by 30% to 35% and sales by around
40%," says Prof. Dr. Henning Kagermann, Co-Chairman of SAP AG.
[LETTERHEAD]
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Adverse currency effects slowed sales growth in the third quarter by 7
percentage points. Provisions for the STAR (Stock Appreciation Rights) employee
incentive program for the first nine months of the year totaled DM 44 million.
Excluding STAR program provisions, pretax profits would have risen 50% (instead
of 45%) in the first nine months, with costs increasing 57% instead of 58% to DM
4.9 billion. The pretax profit margin was 21% in the first nine months of 1998
versus 22% for the first nine months of 1997. Without the STAR provisions,
pretax profits would have grown 53% in the third quarter instead of 50%.
STRONG GROWTH IN THE AMERICAS AND EUROPE
The effects of the economic crisis in Japan on sales in Asia/Pacific (APA) were
offset by higher rates of growth in other regions. Revenues in the Americas
sales region rose 65% to DM 2.7 billion (1997: DM 1.6 billion) in the first nine
months. In Europe, the Middle East and Africa nine-month revenues were up 58% to
DM 2.6 billion (1997: DM 1.7 billion), while Asia/Pacific posted a sales
increase of 4% to DM 537 million (1997: DM 515 million). The proportion of
revenues generated outside Germany rose to 81% over 79% registered in the first
nine months last year. For the third quarter, sales in the Americas rose 55% to
DM 994 million (1997: DM 641 million), and up 50% to DM 866 million (1997: DM
576 million) in Europe, the Middle East and Africa combined.
"SAP Americas continued strong growth can be attributed to our highly successful
initiatives focused on penetrating the installed base, mid-market and new
industry sectors," said Kevin McKay, Chief Executive Officer, SAP America, Inc.
"By leveraging our acclaimed AcceleratedSAP implementation methodology and
TeamSAP initiatives, we have experienced significant success in the mid and
global markets. Our industry solutions have also enabled us to expand our
footprint with the acquisition of new customers and additional commitments from
existing customers across all of the industry sectors we targeted."
The economic crisis in Japan severely impacted performance in the APA region in
the third quarter, and was the main cause of the sales decline. Most other
sub-regions performed as expected. Overall, revenues in the APA region fell 20%
in the third quarter to DM 161 million, as compared with the prior-year figure
of DM 200 million. If the exchange rates in this region had remained constant
year on year, SAP would have posted 2% sales growth. "We have reviewed the
current situation in Japan in detail and do not expect the economy to rebound
quickly," says Prof. Dr. h.c. Hasso Plattner, Co-Chairman of SAP AG. "However,
SAP's position in Japan and the rest of Asia remains strong, and seizing the
long-term growth opportunities in the region remains a core commitment for us,"
he emphasized.
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R/3 SALES UP 49%
Product revenues accounted for the largest share of sales in the first nine
months, increasing 45% to DM 3.6 billion (1997: DM 2.5 billion). Consulting
revenues grew 76% to DM 1.5 billion (1997: DM 0.8 billion) and training revenues
increased 65% to DM 659 million (1997: DM 400 million). Product revenues thus
made up 62% of total sales against 66% in the first nine months of 1997. Sales
of R/3, SAP's flagship product, rose 49% to DM 3.5 billion (1997: DM 2.3
billion).
SAP Group headcount at September 30, 1998 was 18,330, an increase of 6,332, or
53% over September 30, 1997. Research and Development added the most new
employees, growing by 60% over last year. Since January 1,1998, SAP has added
5,474 new employees worldwide, including 1,740 in Germany.
SOLUTION MAPS, AND NEW DIMENSION PRODUCTS/INITIATIVES ANNOUNCED
SAP presented its "New Dimension" product range and Solution Maps for its 17
industry solutions at SAPPHIRE '98, held in Los Angeles in mid-September.
SAPPHIRE'98 was SAP's largest user conference ever, with over 15,000
participants and 260 exhibitors. "Six years ago SAP launched R/3 and
revolutionized the market for enterprise business software. Today we are moving
further and further in the direction of new user groups and concentrating
increasingly on improving our customers' experiences with SAP," emphasized
Plattner. "Our EnjoySAP initiative is focused on simplifying the software and
making it even more intuitive, so that it forms a natural complement to the
user's working environment," he continued.
SAP'S "NEW DIMENSION" PRODUCTS
The SAP products and initiatives previewed at SAPPHIRE include:
SAP BW
The SAP Business Information Warehouse (SAP BW) was released for general sale on
September 1. SAP BW is a separate decision-support and business analysis system
that operates independently of R/3.
SAP SEM
SAP announced the development of a Strategic Enterprise Management solution (SAP
SEM), based on the R/3 System. This solution contains a set of integrated
applications designed to enable senior management of large multinational
organizations to rapidly enhance value creation. SAP SEM consists of four new
applications - Business Planning and Simulation (BPS), Business Consolidation
and Sourcing (BCS), Corporate Performance Monitor (CPM) and
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Stakeholder Relationship Management (SRM) - which provide executives with the
right information at the right time.
SUPPLY CHAIN MANAGEMENT
The Advanced Planner and Optimizer (SAP APO) is currently being shipped to first
customers on schedule. This product is based on new technologies for rapid
planning optimization and execution and is designed to support production
processes involving large numbers of variants. The SAP Logistics Execution
System (SAP LES) showcased in Los Angeles offers an extensive software solution
for warehousing and transportation.
SAP FOCUS ON CUSTOMERS
With its new initiative SAP FOcus on CUStomers (SAP FOCUS), SAP presented its
plans for software solutions that enable organizations to intensify and optimize
their customer relationships in the sales, marketing and service areas. One such
solution is SAP Sales, including the software for sales force automation (SFA),
which is scheduled for shipment to first customers in the fourth quarter of this
year.
INDUSTRY SOLUTION MAPS
SAP has designed solution maps for each of its 17 industry solutions: the first
software provider to develop a tool of this kind. A solution map is a business
and planning blueprint that represents the industry's functional requirements in
detail. The solution maps state specifically which SAP products and those of its
partners match these requirements.
ENHANCED HR CAPABILITIES
SAP also announced SAP Accelerated HR, a solution for rapid implementation of
the HR component based on preconfigured applications and preinstalled technical
platforms. SAP Accelerated HR is initially available in the USA and Canada.
The Human Resources component SAP HR will be generally available in the new
Release 4.5 in the fourth quarter of 1998. It contains enhanced competency-based
management, self-service, payroll accounting functionality and a Manager's
Desktop.
# # #
Any statements contained in this press release that are not historical facts are
forward-looking statements as defined in the Private Securities Litigation
Reform Act of 1995. Words such as "believe" "expect" and "project" as they
relate to the company are intended to identify such forward-looking statements.
The company undertakes no obligation publicly to update or revise any
forward-looking statements. All forward-looking statements are subject to
various risks and uncertainties that could cause actual results to differ
materially from expectations. The factors that could affect the company's future
financial results are discussed more fully in the company's most recently filed
Form 20-F and Form F-1 as filed with the Securities and Exchange Commission on
June 22, 1998.
SAP AG preference and common shares are listed on the Frankfurt Stock Exchange
as well as a number of other exchanges. In the US, SAP's American Depositary
Receipts (ADRs), each worth one-twelfth of a preference share, trade on the New
York Stock Exchange under the symbol 'SAP'. SAP is a component of the DAX, the
index of 30 German blue chip companies. Additional information is available on
SAP AG's home page: http://www.sap.com.
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# # #
(Tables to follow)
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THIRD QUARTER REVENUES COMPARISON 1998 / 1997 (IN DM MILLIONS)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------
Q3 1998 Q3 1997 Change % Change
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
TOTAL REVENUES 2,021 1,417 604 43
- ----------------------------------------------------------------------------------------------------------------------------
Product revenues 1,180 915 265 29
- ----------------------------------------------------------------------------------------------------------------------------
Consulting revenues 559 317 242 76
- ----------------------------------------------------------------------------------------------------------------------------
Training revenues 233 147 86 59
- ----------------------------------------------------------------------------------------------------------------------------
Other revenues 49 38 11 43
- ----------------------------------------------------------------------------------------------------------------------------
PRETAX PROFIT 376 251 125 50
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
Employees (June 30) 18,330 11,998 6,332 53
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
1998 REVENUES BY QUARTER (IN DM MILLIONS)
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
Q1 1998 Q2 1998 Q3 1998 Q4 1998 1998
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
TOTAL REVENUES 1,682 2,175 2,021
- -----------------------------------------------------------------------------------------------------------------------------
Product revenues 1,065 1,396 1,180
- -----------------------------------------------------------------------------------------------------------------------------
Consulting revenues 408 513 559
- -----------------------------------------------------------------------------------------------------------------------------
Training revenues 197 229 233
- -----------------------------------------------------------------------------------------------------------------------------
Other revenues 12 37 49
- -----------------------------------------------------------------------------------------------------------------------------
PRETAX PROFIT 311 521 376
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
1997 REVENUES BY QUARTER (IN DM MILLIONS)
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
Q1 1997 Q2 1997 Q3 1997 Q4 1997 1997
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
TOTAL REVENUES 1,032 1,370 1,417 2,198 6,017
- -----------------------------------------------------------------------------------------------------------------------------
Product revenues 677 921 914 1,585 4,097
- -----------------------------------------------------------------------------------------------------------------------------
Consulting revenues 242 279 318 412 1,251
- -----------------------------------------------------------------------------------------------------------------------------
Training revenues 103 150 147 180 580
- -----------------------------------------------------------------------------------------------------------------------------
Other revenues 10 20 38 21 89
- -----------------------------------------------------------------------------------------------------------------------------
PRETAX PROFIT 181 401 251 834 1,667
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
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SAP GROUP
PRELIMINARY INCOME STATEMENT
THIRD QUARTER
(IN DM MILLIONS)
<TABLE>
<CAPTION>
1998 1997
<S> <C> <C>
SALES REVENUES 2,021 1,417
Increase in inventories of finished
goods and work-in process 17 1
Other operating income 53 8
2,091 1,426
Supplies and purchased goods (6) (5)
Purchased services (279) (156)
COST OF MATERIALS (285) (161)
Personnel expenses (798) (558)
Depreciation and amortization (71) (52)
Other operating expenses (576) (417)
OPERATING EXPENSES (1,445) (1,027)
OPERATING RESULT 361 238
Income from investments 1 1
Income from other securities and loans of financial assets 1 1
Write-down of financial assets 0 (1)
Net interest income 13 12
RESULT FROM ORDINARY OPERATIONS 376 251
</TABLE>
Note: Figures are reported under German accounting principles
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SAP GROUP
PRELIMINARY INCOME STATEMENT
NINE MONTHS JANUARY 1 - SEPTEMBER 30
(IN DM MILLIONS)
<TABLE>
<CAPTION>
1998 1997
<S> <C> <C>
SALES REVENUES 5,878 3,819
Increase in inventories of finished 26 1
goods and work-in process
Other operating income 138 56
6,042 3,876
Supplies and purchased goods (16) (12)
Purchased services (725) (397)
COST OF MATERIALS (741) (409)
Personnel expenses (2,265) (1,471)
Depreciation and amortization (190) (141)
Other operating expenses (1,687) (1,062)
OPERATING EXPENSES (4,142) (2,674)
OPERATING RESULT 1,159 793
Income from investments 2 2
Income from other securities and loans of financial assets 1 1
Write-down of financial assets (1) (1)
Net interest income 47 38
RESULT FROM ORDINARY OPERATIONS 1,208 833
</TABLE>
Note: Figures are reported under German accounting principles
# # #
