<PAGE> 1
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 three-month period ended March 31, 1999
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)
Neurottstrasse 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-_______.
<PAGE> 2
SAP AKTIENGESELLSCHAFT
SYSTEME, ANWENDUNGEN, PRODUKTE IN DER DATENVERARBEITUNG
FORM 6-K
On April 21, 1999, SAP Aktiengesellschaft Systeme, Anwendungen, Produkte in der
Datenverarbeitung, a stock corporation organized under the laws of the Federal
Republic of Germany (the "Company"), issued:
(i) a Press Release announcing its results for the three-month
period ended March 31, 1999, which Press Release is attached
as Exhibit 99.1 hereto and incorporated by reference herein;
and
(ii) a Press Release announcing the impact of the Company's
adoption of U.S. generally accepted accounting principles on
its results for the three-month period ended March 31, 1999,
which Press Release is attached as Exhibit 99.2 hereto and
incorporated by reference herein.
Any statements contained in the Exhibits hereto 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 filings with the
Securities and Exchange Commission (the "SEC"), including its most recently
filed Form 20-F and Form F-1, as filed with the SEC on June 22, 1998, and the
Company's Form 20-F for 1998 that is expected to be filed with the SEC in April
1999.
1
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EXHIBITS
Exhibit No. Exhibit
99.1 Press Release, dated April 21, 1999.
99.2 Press Release, dated April 21, 1999.
2
<PAGE> 4
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/ Dieter Matheis
__________________________________
Name: Dieter Matheis
Title: Chief Financial Officer
By: /s/ Hasso Plattner
__________________________________
Name: Hasso Plattner
Title: Co-Speaker of the
Executive Board
Date: April 26, 1999
3
<PAGE> 5
EXHIBIT INDEX
Exhibit No. Exhibit
99.1 Press Release, dated April 21, 1999.
99.2 Press Release, dated April 21, 1999.
4
<PAGE> 1
Exhibit 99.1
[SAP LOGO]
Press
Information
FOR IMMEDIATE RELEASE
SAP REPORTS 1999 FIRST QUARTER RESULTS; REVENUES INCREASE 22% TO
EUR 1.08 BILLION
IMPACT OF ADOPTION OF U.S. GAAP
WALLDORF, Germany - April 21, 1999 - SAP AG (NYSE: SAP), the world's leading
provider of Enterprise Resource Planning software, today announced its sales for
the quarter ended March 31, 1999. This is the first quarter in which financial
results are reported in accordance with U.S. Generally Accepted Accounting
Principles (U.S. GAAP). The Company has issued an additional press release
providing information on the impact of adopting U.S. GAAP. Revenues grew 22% to
EUR 1,076 million (1998 Q1: EUR 882 million)(US $1,163 million*). Net income was
unchanged at EUR 98 million ($106 million); pretax profit for the quarter fell
1% to EUR 172 million (1998: EUR 173 million)($186 million).
"The first quarter results are better than expected, taking into account the
effects of adopting U.S. GAAP, careful management of expenditures and headcount
increases, as well as several major contracts in Europe signed during the last
week of the quarter," said Henning Kagermann, SAP co-chairman and CEO. "However,
we expect that the positive effects on the quarterly results will even out over
the course of the year, so there should be little difference between results
prepared under U.S. and German GAAP on an annual basis," added Kagermann.
"We still anticipate a 20 to 25% increase in sales for fiscal 1999, with the
pretax profit margin improving up to one percentage point higher than last
year's 21.6% after U.S. GAAP," concluded Kagermann.
ADOPTION OF U.S. GAAP
SAP adopted U.S. GAAP effective January 1, 1999 and restated the 1998 fiscal
results for comparative purposes. Contractual terms for transactions consummated
during the first quarter of 1999 required significantly less revenue deferrals
than the comparable period last year; thus, revenues are approximately EUR 40
million higher than they would have been if recorded under
* US dollar equivalents are provided for reader convenience at the March 31,
1999 exchange rate of US $1.0808 = EUR 1
<PAGE> 2
German GAAP. In accordance with U.S. GAAP net unrealized losses on forward
coverage contracts were charged directly to shareholders' equity. Together these
two effects account almost completely for the difference between the pretax
results calculated using U.S. and German GAAP. Under German GAAP, revenues would
have increased 20% and pretax profit would have decreased 19%.
Notwithstanding adoption of U.S. GAAP, the decline in the value of the SAP
preferred share price required the reversal EUR 15.5 million of expenses
recorded in 1998 for the employees' stock appreciation rights program (STAR).
STRONG GROWTH IN EUROPE
The Europe, Middle East, and Africa (EMEA) region generated the biggest revenue
growth, increasing 36% to EUR 529 million (1998: EUR 390 million). In the
Americas, revenues increased 14% to EUR 448 million (1998: EUR 394 million); at
like-for-like exchange rates, sales in the Americas region would have grown 25%.
In the Asia-Pacific region, first quarter sales remained at last year's level of
EUR 99 million, an increase of 3% at last year's exchange rates. The 22% overall
growth in sales revenue would have been six percentage points higher at 1998
first quarter exchange rates.
Kevin McKay, CEO and President of SAP America, said, "While concern over the Y2K
issue still persists, we have noticed increased interest in SAP's R/3 and New
Dimension products as our inter-enterprise operability becomes more prominent
because of the Internet."
INCREASE IN REVENUES
Product sales, up 7% to EUR 615 million (1998: EUR 575 million), were the
largest contributor to revenue in the first quarter. Consulting revenue
increased 65% to EUR 343 million (1998: EUR 209 million). Revenue from training
rose 19% to EUR 110 million (1998: EUR 92 million). Product revenues as a
percentage of total first quarter revenues decreased from 65% to 57%.
"These impressive results again demonstrate SAP's great potential in the
enterprise resource planning market," stated Hasso Plattner, SAP co-chairman and
CEO. "It also confirms that our focus on the user as well our strategic Internet
orientation are right for the future."
HIGHLIGHTS OF THE FIRST QUARTER
Highlights included:
o Business Information Warehouse (SAP BW) Version 1.2B was delivered at the
end of March. Approximately 470 systems have now been shipped worldwide.
Customers include Hercules Inc. (United States), Clariant AG (Switzerland),
and RWE AG (Germany).
o The new SAP Business-to-Business Procurement (SAP B2B Procurement) software
became generally available at the end of March. Robert Bosch GmbH (Germany)
is one of the first companies to use this software for procuring goods and
services via the Internet.
o SAP's supply chain management software SAP Advanced Planner and Optimizer
(SAP APO) was first delivered at the end of 1998. More than 110 systems
have now been delivered worldwide. Customers include Colgate-Palmolive Inc.
and Motts (United States); Fischerwerke and Deutsche Goodyear (Germany).
<PAGE> 3
o The first of SAP's customer relationship management software products, SAP
Sales and SAP Service, were delivered on time at the end of March to the
first 13 customers.
o In March, results from EnjoySAP, the usability initiative, were presented
to an enthusiastic public in Palo Alto, CA and at CeBIT in Hanover,
Germany. EnjoySAP addresses user requirements which have resulted in a
redesign of the software. It is easier to learn, quicker to work with, and
more adaptable to the way individuals work.
KEY FIGURES (IN EUR MILLIONS)
<TABLE>
<CAPTION>
Q1 1999 Q1 1998 CHANGE % CHANGE
------- ------- ------ --------
<S> <C> <C> <C> <C>
Total Revenue 1,076 882 194 + 22
------
Income before income taxes 172 173 - 1 - 1
------ ------- ----- ----
Net income 98 98 0 0
------ ------ ----- ----
Number of employees (March 31) 20,406 15,010 5,396 + 36
------ ------ ----- ----
- - thereof Germany 8,045 6,224 1,821 + 29
------ ------ ----- ----
</TABLE>
Any statements contained in this document 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 filings with the
Securities and Exchange Commissions (the "SEC"), including its most recently
filed Form 20-F and Form F-1, as filed with the SEC on June 22, 1998, and the
Company's Form 20-F for 1998 that is expected to be filed with the SEC in April
1999.
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.
# # #
(Tables to follow)
<PAGE> 4
For more information, please contact:
MEDIA:
Michael Pfister, SAP AG, 49-6227-7-41758
John Milana, SAP America, 610-355-4054
INVESTOR RELATIONS:
Gundolf Moritz, SAP AG, 49-6227-7-44872
Jim Prout, Taylor Rafferty, 212-889-4350
<PAGE> 5
CONSOLIDATED INCOME STATEMENTS 1ST QUARTER 1999
SAP Group (in EUR millions)
<TABLE>
<CAPTION>
Q1 1999 Q1 1998 CHANGE
------- ------- ------
<S> <C> <C> <C>
Product revenue 615 575 7%
Consulting revenue 343 209 65%
Training revenue 110 92 19%
Service revenue 453 301 50%
Other revenue 8 6 43%
------- ------- ------
TOTAL REVENUE 1,076 882 22%
------- ------- ------
Cost of product -96 -77 25%
Cost of service -389 -263 48%
Research and development -138 -108 28%
Sales and marketing -225 -204 10%
General and administration -42 -48 -12%
Other income/expenses, net -12 -12 0%
------- ------- ------
TOTAL OPERATING EXPENSE -902 -712 27%
------- ------- ------
------- ------- ------
OPERATING INCOME 174 170 2%
------- ------- ------
Other non-operating income/
expenses, net -6 0 n.a.
Finance income, net 4 3 20%
------- ------- ------
INCOME BEFORE INCOME TAXES 172 173 -1%
------- ------- ------
Income taxes -74 -75 -1%
------- ------- ------
NET INCOME 98 98 0%
------- ------- ------
------- -------
DSO (IN DAYS) 108 100
------- -------
</TABLE>
<PAGE> 6
CONSOLIDATED BALANCE SHEETS 1ST QUARTER 1999
SAP Group (in EUR millions)
ASSETS
<TABLE>
<CAPTION>
03/31/1999 12/31/1998
<S> <C> <C>
INTANGIBLE ASSETS 85 75
PROPERTY, PLANT AND EQUIPMENT 678 645
FINANCIAL ASSETS 227 184
----- -----
FIXED ASSETS 990 904
INVENTORIES/ ACCOUNTS RECEIVABLE
AND OTHER ASSETS 1,786 1,676
LIQUID ASSETS 782 670
----- -----
CURRENT ASSETS 2,568 2,346
DEFERRED TAXES 199 114
PREPAID EXPENSES AND DEFERRED CHARGES 56 21
----- -----
TOTAL ASSETS 3,813 3,385
SHAREHOLDERS' EQUITY AND LIABILITIES
03/31/1999 12/31/1998
SHAREHOLDERS' EQUITY 1,950 1,818
MINORITY INTEREST 7 7
RESERVES AND ACCRUED LIABILITIES 569 653
OTHER LIABILITIES 631 600
DEFERRED INCOME 656 307
----- -----
TOTAL SHAREHOLDER'S EQUITY AND LIABILITIES 3,813 3,385
</TABLE>
<PAGE> 1
Exhibit 99.2
[SAP LOGO]
Press
Information
FOR IMMEDIATE RELEASE
SAP ANNOUNCES IMPACT OF ADOPTING U.S. GAAP ON FIRST QUARTER RESULTS
WALLDORF, Germany -- April 21, 1999 -- SAP AG (NYSE: SAP), the world's leading
provider of Enterprise Resource Planning software, today announced its results
for the first quarter of 1999 in a separate press release. The reported results
reflected the following for all future financial reporting periods:
- - Adoption of U.S. Generally Accepted Accounting Principles ("U.S. GAAP");
- - Change of global reporting currency from the Deutsche Mark to the euro;
- - Modification of the income statement reporting format.
"We are pleased with the smooth transition from German GAAP to U.S. GAAP, and
the concurrent change to euro reporting. This was done in a remarkably short
period of time, thanks to a strong working team and the SAP software systems,"
said Dieter Matheis, Chief Financial Officer of SAP AG. "These changes will
facilitate the comparison of our financial results to others within our
industry."
Each of the 1998 quarterly income statements have been restated below.
- more -
<PAGE> 2
- 2 -
QUARTERLY CONSOLIDATED INCOME STATEMENTS
SAP GROUP
(In Mio. EUR)
<TABLE>
<CAPTION>
-
Q1 Q2 Q3 Q4 1998 Q1 1999 Q1 '99 vs '98
-- -- -- -- ---- ------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Product revenue 575 726 626 793 2,720 615 7%
Consulting revenue 209 262 287 364 1,122 343 65%
Training revenue 92 107 109 104 412 110 19%
Service revenue 301 369 396 468 1,534 453 50%
Other revenue 6 19 25 12 62 8 43%
--- ----- ----- ------ ------ ----- ----
TOTAL REVENUE 882 1,114 1,047 1,273 4,316 1,076 22%
--- ----- ----- ------ ------ ----- ----
Cost of product -77 -79 -89 -124 -369 -96 25%
Cost of service -263 -305 -312 -376 -1,256 -389 48%
Research and development -108 -152 -143 -170 -573 -138 28%
Sales and marketing -204 -265 -245 -251 -965 -225 10%
General and administration -48 -53 -53 -54 -208 -42 -12%
Other income/expenses, net -12 -4 -3 -25 -44 -12 0%
---- ----- ----- ------ ------ ----- ----
TOTAL OPERATING EXPENSE -712 -858 -845 -1,000 -3,415 -902 27%
---- ----- ----- ------ ------ ----- ----
OPERATING INCOME 170 256 202 273 901 174 2%
Other non-operating income/
expenses, net 0 7 16 -7 16 -6 -
Finance income, net 3 5 3 3 14 4 20%
---- ----- ----- ------ ------ ----- ----
INCOME BEFORE INCOME TAXES 173 268 221 269 931 172 -1%
---- ----- ----- ------ ------ ----- ----
Income taxes -75 -116 -96 -117 -404 -74 -1%
---- ----- ----- ------ ------ ----- ----
NET INCOME 98 152 125 152 527 98 0%
---- ----- ----- ------ ------ ----- ----
</TABLE>
REVENUE BY REGIONS (IN EUR MILLIONS)
<TABLE>
<CAPTION>
REVENUE Q1 1999 Q1 1998 CHANGE %
- ------- ------- ------- --------
<S> <C> <C> <C>
EMEA 529 390 36
Americas 448 394 14
APA 99 99 0
Group 1,076 882 22
</TABLE>
<TABLE>
<CAPTION>
REVENUE Q1 Q2 Q3 Q4 1998
- ------- -- -- -- -- ----
<S> <C> <C> <C> <C> <C>
EMEA 390 531 448 553 1,921
Americas 394 478 516 609 1,998
APA 99 105 83 111 397
Total Group 882 1,114 1,047 1,273 4,316
</TABLE>
- more -
<PAGE> 3
- 3 -
REVENUE DEFERRALS
In accordance with U.S. GAAP ("SOP 97-2") software revenue recognition, certain
license revenues are required to be deferred either because of extended payment
terms, phased maintenance rates and/or maintenance rates which vary from
standard conditions.
In the first quarter of 1999, SOP 97-2 had a positive impact of approximately
EUR 40 million on product revenues, due to less revenue requiring deferral
because of changes in maintenance commencement dates, shorter payment terms and
increased revenue from existing customers who are currently at the standard
maintenance rates.
On a full year basis, considering the overall seasonality of revenue, the
Company does not expect a significant difference between U.S. and German GAAP.
ACCOUNTING FOR HEDGING GAINS/LOSSES
During the first quarter of 1999, the Company also adopted SFAS 133,
"Accounting for Derivative Instruments and for Hedging Activities",
prospectively. In accordance with SFAS 133, approximately EUR 18 million of net
unrealized foreign currency losses relating to hedging activities were charged
to shareholders' equity. Prior to the adoption of SFAS 133, such losses would
have been charged to earnings and accordingly were included in management's
initial pretax profit projections. Management does not believe that the adoption
of SFAS 133 will have a material impact on annual results.
STAR REVERSAL
Due to a decline in value of the SAP AG preference share price, amounts
previously accrued for the Company's STAR program (stock appreciation rights)
were reversed during the first quarter of 1999 which had the effect of
increasing pretax profit by approximately EUR 15.5 million as adjusted for U.S.
GAAP in 1998. During the second quarter of 1999, concurrent with the end of the
1998 program, the Company once again issued STAR grants to its worldwide
employee base. Accordingly, accruals may be recorded during the year that would
reduce income for the period.
###
Any statements contained in this document 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 filings with the
Securities and Exchange Commissions (the "SEC"), including its most recently
filed Form 20-F and Form F-1, as filed with the SEC on June 22, 1998, and the
Company's Form 20-F for 1998 that is expected to be filed with the SEC in April
1999.
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.
- more -
<PAGE> 4
- 4 -
For more information, please contact:
John Milana, SAP America, 610-355-4054
Joel Bernstein, SAP AG, 011-49-6227-74-7050
Jim Prout, Taylor Rafferty, 212-889-4350
