IXOS Software AG
IXOS: double-digit growth in revenues and earnings
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IXOS: double-digit growth in revenues and earnings – H1 2003/2004: consolidated
net income up 43%, license business up 14%, European business up 33%
Grasbrunn near Munich, February 3, 2004 – IXOS SOFTWARE AG (TecDAX: “XOS”,
NASDAQ: “XOSY”), Europe’s leading provider of enterprise content management
(ECM) solutions, recorded double-digit growth in H1 2003/2004, exceeding its own
projections. Consolidated revenues rose by 14% to EUR 69.0 million in the
period July 1 – December 31, 2003 (previous year: EUR 60.3 million). Adjusted
for exchange rate effects, revenues were up 22% year-on-year in the first half
year. EBIT increased by 13% to EUR 1.8 million (previous year: EUR 1.6 million).
Consolidated net income rose by 43% to EUR 1.7 million (previous year: EUR 1.2
million). This corresponds to earnings per share of EUR 0.08 (previous year: EUR
0.06). “Our highly competitive software solutions have enabled us to expand our
market position as the leading European provider of enterprise content
management solutions, and to substantially increase the profitability of the
Group,” said Robert Hoog, Chairman of IXOS’ Executive Board, commenting on the
H1 results.
IXOS was able to generate double-digit growth in consolidated revenues in the
second quarter of the current fiscal year as well, with an increase of 13% to
EUR 38.9 million (previous year: EUR 34.4 million). Adjusted for exchange rate
effects, revenues were up 21% year-on-year in the second quarter. EBIT rose
slightly year-on-year, at EUR 3.95 million (previous year: EUR 3.87 million).
Net income improved in Q2 by 7% to EUR 3.7 million (previous year: EUR 3.5
million). This corresponds to earnings per share of EUR 0.17 (previous year: EUR
0.16). “Despite extensive investment in developing and marketing our new
products, we recorded a high operating margin of 10% in the second quarter and
therefore demonstrated efficient cost management,” said CFO Peter Rau about the
results for the quarter. “We have also succeeded in substantially improving our
financial result in the first half of the year by eliminating exchange rate
risks,” Rau added.
License and maintenance business drive growth
In Q2 2003/2004, license revenues increased by 13% to EUR 16.5 million (previous
year: EUR 14.6 million). At the same time, IXOS increased its revenues in the
Maintenance business unit by 24% to EUR 12.3 million (previous year: EUR 9.9
million). This upward trend is due to the systematic expansion of the installed
base, which rose by around 30% to 3,000 product installations (previous year:
2,300). Revenues in the Professional Services business unit were up 2% to EUR
10.1 million (previous year: EUR 9.9 million), despite sustained price pressure.
“This underlines the growing customer demand for IXOS’ one-stop, end-to-end
product solutions and services,” said Richard Gailer, member of IXOS’ Executive
Board with responsibility for sales.
Strong growth in Europe
Regionally, IXOS was particularly successful in Q2 in the EMEA region (Europe
excluding Germany, the Middle East and Africa). This is due to the focused sales
organization in this region and the launch of the extended ECM product range.
In EMEA, revenues for the quarter rose by 43% to EUR 15.5 million (previous
year: EUR 10.9 million). Business development was particularly strong in the
United Kingdom, Switzerland, Scandinavia, and the Benelux countries. The Germany
sales region generated a 3% increase in its share of revenues, taking it to EUR
9.9 million (previous year: EUR 9.5 million). IXOS’ main successes here came in
the key target market of insurance and banks. At 10%, the software group also
achieved double-digit revenue growth in the Asia/Pacific region to EUR 5.1
million (previous year: EUR 4.7 million). This sales region is registering
increasing demand for IXOS’ solutions and, as a growth market, offers good
revenues potential for the Group. On a constant exchange rate basis, the
Americas sales region would have provided IXOS with a year-on-year increase in
revenues of 8% in Q2. However, the ongoing weakness of the dollar meant that
consolidated revenues in euros fell by 10% year-on-year to EUR 8.3 million
(previous year: EUR 9.3 million). IXOS has focused its sales activities in the
region and believes that there is healthy demand here for its content management
and e-mail compliance solutions. In terms of regions, Europe (EMEA) remains
IXOS’ most important sales region with a 40% share of revenues, followed by
Germany with 25%, the Americas with 22%, and Asia/Pacific with 13% of total
revenues.
Another driving force behind IXOS’ revenue increase was its close cooperation
with partners that began in 2003. The Company has extended its cooperation with
all worldwide leading systems integrators, generating around 30% of all new
license revenues in H1 2003/2004 with these partners. “In the second quarter,
the Company was able to enter into partnerships with the leading storage media
manufacturers Hitachi and StorageTek for the distribution and development of
joint storage and archiving solutions, and has already recorded initial joint
revenues,” said Gailer, commenting on the partnership strategy. The member of
the Executive Board with responsibility for sales believes that this will
provide further growth potential in the current fiscal year.
Solid financial structure
Consolidated total assets as of December 31, 2003 amounted to EUR 108.6 million
(June 30, 2003: EUR 108.3 million). The equity ratio improved to 67% (June 30,
2003: 65%). On December 31, 2003, IXOS employed 915 people worldwide (June 30,
2003: 919 employees).
IXOS remains upbeat for H2
IXOS’ Executive Board remains upbeat about the second half of the year and is
reiterating its projections. At the beginning of fiscal year 2003/2004, the
Group forecast revenue growth of at least 10% and positive income from
operations for the year as a whole. “There is healthy demand for our expanded
solutions offering, which we are increasingly marketing on a global scale.
Customers and business partners welcome the planned business combination with
the Canadian Open Text Group and see this as the right strategic move towards
positioning IXOS as the global market leader,” said Robert Hoog, Chairman of
IXOS’ Executive Board.
Open Text has made a public tender offer to all IXOS shareholders, and the
acceptance period ended on January 30, 2004. The results of this will be
published on February 5, 2004. The planned combination of the two companies is
set to create the global market leader for enterprise content management (ECM)
software. Against the current background of market consolidation, and driven by
its comprehensive product range and international presence, the new company will
be in an outstanding position to benefit disproportionately from the growth in
the ECM market.
IXOS-IR-Hotline ++49/89/4629-2400
end of message, (c)DGAP 03.02.2004
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WKN: 506150; ISIN: DE0005061501; Index: TecDAX, NEMAX 50
Listed: Geregelter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin-
Bremen, Düsseldorf, Hamburg, Hannover, München und Stuttgart
030755 Feb 04
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