IDS Scheer AG
IDS Scheer increases EBITA margin to 8.9% on revenue of EUR 259.4 million
IDS Scheer AG / Quarter Results 05.11.2009 Dissemination of a Corporate News, transmitted by DGAP - a company of EquityStory AG. The issuer / publisher is solely responsible for the content of this announcement. --------------------------------------------------------------------------- IDS Scheer increases EBITA margin to 8.9% on revenue of EUR 259.4 million Saarbruecken, 5 November 2009 In the first nine months of 2009, IDS Scheer AG generated revenues of EUR 259.4 million as against EUR 294.1 million in the same period of the previous year. This corresponds to a decline of 11.8%; changes in exchange rates had no significant effect on the total revenue. The development in revenue in fiscal 2009 is dominated by the difficult general market environment as well as the restructuring measures introduced a year ago. The resulting strict cost management led to an increase in operating earnings before interest, taxes and amortization (EBITA) of 42% to EUR 23.1 million (previous year: EUR 16.3 million). The EBITA margin was raised to 8.9% after 5.5% in the same period of the previous year. Operating earnings before interest and taxes (EBIT) climbed from EUR 14.7 million in the previous year to EUR 21.8 million, equivalent to a 48% growth rate. The EBIT margin was raised to 8.4% compared to 5.0% in the previous year. In the same period, consolidated net profit increased by only 7% to EUR 10.7 million; this is primarily due to the assessment of the utility of tax loss carry-forwards. Earnings per share (EPS, basic) increased from EUR 0.29 in the same period of the previous year to EUR 0.34. In the first nine months of 2009, revenue from ARIS licenses amounted to EUR 26.7 million (previous year: EUR 32.9 million). ARIS maintenance revenue increased by 13% to EUR 21.9 million. A gross profit margin of 96% was generated in products business, consisting of ARIS licenses and ARIS maintenance. Revenue from third-party licenses and maintenance was EUR 17.7 million after EUR 19.3 million in the same period of the previous year. This area reported a gross profit margin of 32%. Business volume in the consulting/services area declined to EUR 193.1 million (previous year: EUR 222.3 million), with the gross profit margin for this area at 20%. The order backlog in consulting/services amounted to EUR 92 million (previous year: EUR 106 million). As of 30 September 2009, IDS Scheer AG had 2,697 employees worldwide as against the 3,031 as of the previous year's reporting day. This 11% decrease was a result of the consolidation measures that were part of the company's global reorganization and restructuring. 61% of employees work in the DACH region (previous year: 56%), 26% in the EMEA region (previous year: 28%), 7% in the Americas region (previous year: 9%) and 6% in the Asia-Pacific region (previous year: 7%). Further key data In the first nine months of 2009, spending for research and development relating to the further development of the ARIS Platform was increased by 2% to EUR 11.1 million (previous year: EUR 10.9 million). Thus, research and development expenses increased to a 4.3% share of total revenue in the nine-month period (previous year: 3.7%). Thanks to the internal reorganization and strict cost management, IDS Scheer AG's structures were designed more efficiently and cost synergies were reaped with the result that significant earnings improvements were achieved in spite of lower sales. The cost of sales in the first nine months was reduced to EUR 168.2 million (previous year: EUR 194.7 million). The gross margin therefore improved to 35.1% (previous year: 33.8%). Sales and marketing costs were reduced by 14% to EUR 45.4 million. The synergies generated by merging the sales units led to significant efficiency improvements, enabling the company to lower the share of sales and marketing costs to 17.5% of revenue (previous year: 17.9%). General administration costs declined from EUR 20.9 million to EUR 15.8 million, which led to a reduced share of sales of 6.1% (previous year: 7.1%). The efficient processes created as part of the reorientation and the merger of internal functions to shared services had a significant positive impact. Cash flow from operating activities for the first nine months amounted to EUR 17.0 million versus EUR 8.1 million in the previous year. Precisely in times of general economic crisis, IDS Scheer is increasingly focusing on improving working capital. Free cash flow rose to EUR 15.6 million, thus more than tripling as against the previous year (EUR 5.0 million). Cash and cash equivalents rose by EUR 7.9 million in the first nine months to EUR 121.1 million as of 30 September 2009 compared to EUR 113.2 million as of the end of 2008 (30 September 2008: EUR 102.4 million). Takeover offer by Software AG IDS Scheer AG was informed on 13 July 2009 by SAG Beteiligungs GmbH, a wholly owned subsidiary of Software AG based in Darmstadt, of its decision to make a voluntary public takeover offer for all shares of IDS Scheer AG in accordance with Sections 29 et seq. of the German Securities Acquisition and Takeover Act (Wertpapiererwerbs-und Übernahmegesetz; WpÜG). On 23 October 2009, Software AG announced that at this date it held 90.002% of IDS Scheer AG shares via its wholly owned subsidiary SAG Beteiligungs GmbH. For further details of the takeover, please refer to SAG Beteiligungs GmbH's offer documents, the joint statement by the Executive Board and the Supervisory Board of IDS Scheer AG, and further information on the websites of the two companies at www.ids-scheer.com and www.softwareag.com. The aim of the takeover of IDS Scheer AG by Software AG is to create a global manufacturer of infrastructure software and Business Process Management with more than 6,000 employees and revenue of over EUR 1 billion (on the basis of figures for fiscal 2008). Outlook 'The Executive Board of IDS Scheer AG considers the company to be well positioned in the global market for Business Process Management. Our cost reduction measures implemented as part of the restructuring of the global organization have taken effect and will continue to have a positive impact on earnings. We are convinced that the future success of our company will also be determined by the rigorous continuation of restructuring measures and the innovation campaign which we have launched,' explains Peter Gérard, CEO and President of IDS Scheer AG. 'After considerable investment restraints were still observed among customers in the third quarter, we now expect that the situation is bottoming out. However, we see differing signals regarding the economic improvement on the international markets.' At the end of the third quarter, the Executive Board of IDS Scheer AG concretizes the outlook for 2009 as a whole. Due to the continued difficult market environment, revenue is now expected at a level of approximately EUR 350 million. When the results for the first six months were presented, the Executive Board anticipated that revenue would be towards the lower end of the published forecast corridor (EUR 370 million to EUR 390 million). Thanks to the positive effects of the cost reduction measures, the Executive Board now expects to generate an EBITA margin of more than 8%, thus exceeding the forecast earnings range of 7% to 8% in the year as a whole. Information and invitation for journalists and analysts: The complete interim report for the first nine months of 2009 is published online at www.ids-scheer.com/Interim_Reports CEO and President Peter Gérard and CFO Jörg Vandreier will explain the nine months results today, 5 November 2009, from 2 p.m. to 3 p.m. at an English-language teleconference for representatives of the press and analysts. The access number for the teleconference is provided on telephone number +49 681-210-1050 or -3201. ______________ For further information please contact: Susanne Paul / Ingrid Britz-Averkamp Investor Relations, Financial Press Tel.: + 49 (0) 681 / 210 3201 Fax: + 49 (0) 681 / 210 1231 E-Mail: susanne.paul@ids-scheer.com 05.11.2009 Financial News transmitted by DGAP --------------------------------------------------------------------------- Language: English Company: IDS Scheer AG Altenkesseler Straße 17 66115 Saarbrücken Deutschland Phone: +49 (0)681 210-1050 Fax: +49 (0)681 210-1231 E-mail: invest@ids-scheer.com Internet: www.ids-scheer.com ISIN: DE0006257009 WKN: 625700 Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin, Düsseldorf, Hannover, München, Hamburg, Stuttgart End of News DGAP News-Service ---------------------------------------------------------------------------
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