Double digit decline in cash flow at SAP
Second quarter results for German software giant SAP show a decline in cash flow
SAP, the financial software giant, has seen cash flow fall by 30% for the
first six months of this year compared with the same period last year.
Financial results out today from the German IT company highlights cash flow
has declined 30% in H1 2010 to €1.28bn (£1.07bn) from €1.82bn for the same
period in 2009.
The company said the year on year decrease is a result of receiving
significantly more payments in 2009 than 2010. This is due to a surge in late
payments from 2008. SAP also attributed the decline to a one-time payment, in
the second quarter of 2010, from a settlement of a lawsuit with the insurance
reimbursement expected later this year.
However, there was some good news. The business increased operating profit,
under IFRS, by 21% to €774m in the second quarter of 2010, up from €641m for the
same period in 2009.
Profits after tax also increased in Q2 2010 to €491m from €426m Q2 2009;
software related services increased 16% to €2.26bn compared to the same period
in 2009; and software revenues grew 17% to €637m from €543m compared to the
second quarter of last year.
Bill McDermott, Co-CEO of SAP said the increases to the top line was due to
growth in software and support revenue as well as “double digit growth” in
subscription revenue.
The latest report excludes acquisition related charges and discontinued
activities costing a total of €66m.
The business managed to secure Delta Air Lines and Malaysia Airports as
customers in the second quarter of 2010.
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