Form 6-K

0001193125-14-151635.txt : 20140422 0001193125-14-151635.hdr.sgml : 20140422 20140422065933 ACCESSION NUMBER: 0001193125-14-151635 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20140422 FILED AS OF DATE: 20140422 DATE AS OF CHANGE: 20140422 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SAP AG CENTRAL INDEX KEY: 0001000184 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 000000000 STATE OF INCORPORATION: 2M FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 6-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-14251 FILM NUMBER: 14775220 BUSINESS ADDRESS: STREET 1: DIETMAR-HOPP-ALLEE 16 CITY: WALLDORF STATE: 2M ZIP: 69190 BUSINESS PHONE: 0114962277 MAIL ADDRESS: STREET 1: DIETMAR-HOPP-ALLEE 16 CITY: WALLDORF STATE: 2M ZIP: 69190 FORMER COMPANY: FORMER CONFORMED NAME: SAP AKTIENGESELLSCHAFT SYSTEMS APPLICATIONS PRODUCTS IN DATA DATE OF NAME CHANGE: 19960807 6-K 1 d712946d6k.htm FORM 6-K Form 6-K

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

April 22, 2014

Commission file number:

1-14251

SAP AG

(Exact name of registrant as specified in its charter)

SAP CORPORATION

(Translation of registrant’s name into English)

Dietmar-Hopp-Allee 16

69190 Walldorf

Federal Republic of Germany

(Address of principal executive offices)

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- .

TABLE OF CONTENTS


EXHIBITS			3
SIGNATURES			4
EXHIBIT INDEX			5
Exhibit 99.1

SAP AG

FORM 6-K

On April 17, 2014, SAP AG, a stock corporation organized under the laws of the Federal Republic of Germany (“SAP”), issued a press release (the “Press Release”) announcing SAP’s financial results for the first quarter ended March 31, 2014. The Press Release is attached as Exhibit 99.1 hereto and incorporated by reference herein.

This Press Release discloses certain non-IFRS measures. These measures are not prepared in accordance with IFRS and are therefore considered non-IFRS financial measures. The non-IFRS financial measures that we report should be considered in addition to, and not as substitutes for or superior to, revenue, operating income, cash flows, or other measures of financial performance prepared in accordance with IFRS.

Please refer to Explanations of Non-IFRS Measures online (www.sap.com/about/investor/index.epx) for further information regarding the non-IFRS measures.

Any statements contained in this document that are not historical facts are forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Words such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “project,” “predict,” “should” and “will” and similar expressions as they relate to SAP are intended to identify such forward-looking statements. SAP undertakes no obligation to publicly 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 SAP’s future financial results are discussed more fully in SAP’s filings with the U.S. Securities and Exchange Commission (the “SEC”), including SAP’s most recent Annual Report on Form 20-F for 2013 filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates.

EXHIBITS


Exhibit No.		Exhibit

99.1		Press Release dated April 17, 2014

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 AG
(Registrant)

By:		/s/ Christoph Huetten
		Name: Dr. Christoph Huetten
		Title: Chief Accounting Officer

By:		/s/ Sonja Simon
		Name: Sonja Simon
		Title: Head of Group Accounting and Reporting

Date: April 22, 2014

EXHIBIT INDEX


Exhibit No.		Exhibit

99.1		Press Release dated April 17, 2014

EX-99.1 2 d712946dex991.htm EXHIBIT 99.1 Exhibit 99.1

Exhibit 99.1

LOGO

For Immediate Release

April 17, 2014

SAP Announces First Quarter 2014 Results

Successfully Transitioning to the Cloud with 38% Constant Currency Growth in Non-IFRS Cloud Subscriptions and Support Revenue

•

Fast Cloud Growth Ahead of Annual Outlook Growth Range: Non-IFRS Cloud Subscriptions and Support Revenue Increased 38% at Constant Currencies (32% at Actual Currencies)

•

Strong Cloud Billings Growth: Non-IFRS Calculated Cloud Billings Increased 36% at Constant Currencies; Annual Cloud Revenue Run Rate Approaching €1.1 Billion

•

SSRS Revenue Growth Ahead of Annual Outlook Growth Range: Non-IFRS Software and Software-Related Service Revenue Increased 9% at Constant Currencies (4% at Actual Currencies to €3.06 Billion Impacted by Strong Currency Headwinds)

•

Broad Adoption of SAP HANA as the Real-Time Business Platform: More Than 3,200 HANA Customers, Approaching 1,000 Customers for Business Suite on HANA, Vibrant Ecosystem with More Than 1,200 Start-Ups Developing on HANA Platform

•

Growing Operating Profit and Accelerating Shift to the Cloud: Non-IFRS Operating Profit Increased 7% at Constant Currencies (2% at Actual Currencies to €919 Million Impacted by Strong Currency Headwinds)

•

Reiterating Full Year 2014 Outlook

WALLDORF, Germany – April 17, 2014 – SAP AG (NYSE: SAP) today announced its financial results for the first quarter ended March 31, 2014.

BUSINESS HIGHLIGHTS IN THE FIRST QUARTER 2014

SAP is successfully transitioning to the cloud demonstrated by fast growth in cloud and a solid performance in the core business, which drove revenue growth in the first quarter 2014. Non-IFRS cloud subscriptions and support revenue increased 38% at constant currencies (32% at actual currencies). Non-IFRS software and support revenue increased 7% at constant currencies (2% at actual currencies). Non-IFRS software and software-related service revenue grew 9% at constant currencies (4% at actual currencies).

“We are well on our way to becoming THE cloud company powered by SAP HANA with fast growth in the cloud and broad adoption of HANA as the real-time business platform,” said Bill McDermott and Jim Hagemann Snabe, Co-CEOs of SAP. “We offer our entire Business Suite in the cloud and are leading the market with the most comprehensive end-to-end HR cloud solution. And our customers can manage all workers, goods and services through the world’s largest business network in the SAP cloud.”


*SAP Reports First Quarter 2014 Results*			Page 2

“Our 9% constant currency growth in non-IFRS software and software-related service revenue puts us ahead of our annual outlook growth range,” said Werner Brandt, CFO of SAP. “We slightly increased our operating margin while accelerating our cloud business. Operating profit was up 7% on a non-IFRS constant currency basis in the quarter driving strong operating cash flow, which increased by 9% to €2.35 billion. This result brought us back to positive net liquidity in a relatively short time frame after sizable acquisitions in the past two years.”

SAP’s annual cloud revenue run rate is now approaching €1.1 billion¹ or $1.5 billion². Non-IFRS calculated cloud billings³ increased 36% year-over-year at constant currencies. Non-IFRS deferred cloud subscriptions and support revenue was €454 million as of March 31, 2014, a year-over-year increase of 29% at constant currencies. SAP’s cloud applications total subscribers now exceed 36 million, which is the most of any vendor in the industry today.

SAP’s customer-facing solutions are defining the next generation of customer engagement. The hybris omni-channel e-commerce platform in combination with SAP Cloud for Sales is seeing triple-digit growth in software and cloud subscriptions and support revenue as companies redefine customer engagement and retention and unlock new cross-sell and upsell opportunities in real-time.

In Cloud for Procurement, SAP continues to scale the world’s largest Web-based business trading community with trailing twelve month Ariba network spend volume⁴ exceeding $0.5 trillion and around 1.5 million connected companies.

SAP HANA had a strong adoption rate in the first quarter, demonstrating that it is the leading real-time business platform. SAP now has more than 3,200 SAP HANA customers since market launch in June 2011 and close to 1,000 customers for SAP Business Suite Powered by SAP HANA, which was launched just one year ago. SAP HANA is also evolving into the leading technology platform: there are more than 1,200 startups from 57 countries building applications on SAP HANA. Of these startups, more than 60 already have commercially available products on the market today.

SAP is also expanding its vibrant partner ecosystem. Accenture will use the Ariba Network to power their procurement business process outsourcing practice. SAP expects this will significantly drive connected companies and transaction volume. Together the companies have also formed the Accenture and SAP Business Solutions Group, which includes dedicated experts from both companies, to jointly develop integrated, industry-specific solutions powered by SAP HANA and delivered via the Cloud.

SAP has also entered into a new strategic partnership with Adobe which combines Adobe Marketing Cloud with the SAP Hybris Commerce Suite and the SAP HANA platform. Adobe and SAP will deliver real-time customer engagement with relevant, contextual experiences across numerous marketing channels and customer touch-points. This will redefine customer engagement and retention in the fast changing and highly competitive consumer world.

The annual revenue run rate is the total of first quarter 2014 non-IFRS cloud subscriptions and support revenue (€221 million) plus Non-IFRS cloud-related professional services and other service revenue (€43 million) multiplied by 4. This definition has changed from the previous year. Please see the interim report for more details.

²	Translated into USD for reader’s convenience based on $/€ exchange rate of $1.38/€1.00 at the end of the first quarter 2014.

³	Calculated cloud billings is the total of a period’s cloud subscriptions and support revenue and of the respective period’s change in the deferred cloud subscriptions and support revenue balance.

⁴	Network spend volume is the total value of purchase orders transacted on the Ariba Network in the trailing 12 months.


*SAP Reports First Quarter 2014 Results*			Page 3

First Quarter 2014 Regional Revenue

SAP saw solid regional performance in EMEA, despite uncertainties in CIS due to the Crimea crisis. Non-IFRS software and software-related service revenue increased 8% year-over-year at constant currencies. This was the result of 39% growth in non-IFRS cloud subscription and support revenue at constant currencies and strong software revenue growth in markets such as Africa, Southern Europe and France.

The Americas region had a solid performance in the first quarter with 10% growth in non-IFRS software and software-related service revenue at constant currencies and 37% growth in non-IFRS cloud subscriptions and support revenue at constant currencies. In North America SAP saw a continued fast transition to the cloud and also strong software revenue performance from Canada. The Company continues to see strong demand in Latin America with tremendous growth opportunities across all markets. Highlights in Latin America included triple-digit software revenue growth at constant currencies in Colombia and Venezuela and high double-digit software revenue growth at constant currencies in Argentina.

In the APJ region SAP saw a mixed performance. Non-IFRS Cloud subscriptions and support revenue had a very strong quarter with a 43% growth rate at constant currencies. Non-IFRS software and software-related service revenue grew in the mid-single-digit range at constant currencies. While Japan was below expectations, China was a particular highlight. In China SAP achieved strong double-digit software revenue growth at constant currencies, which demonstrates the success of SAP’s long term commitment and growth strategy for China.


*SAP Reports First Quarter 2014 Results*			Page 4

FINANCIAL RESULTS IN DETAIL

FINANCIAL HIGHLIGHTS – First Quarter 2014


	First Quarter 2014¹⁾
	IFRS						Non-IFRS²⁾
€ million, unless otherwise stated	Q1 2014		Q1 2013		% change		Q1 2014		Q1 2013		% change		% change const. curr.
Cloud subscriptions and support		219		137		60		221		167		32		38
Software		623		657		–5		623		657		–5		1
Support		2,213		2,109		5		2,214		2,113		5		9
Software and support		2,836		2,765		3		2,838		2,770		2		7
Software and software-related service revenue		3,055		2,903		5		3,058		2,937		4		9
Total revenue		3,698		3,601		3		3,701		3,636		2		6
Total operating expenses		–2,975		–2,955		1		–2,782		–2,734		2		6
Operating profit		723		646		12		919		901		2		7
Operating margin (%)		19.5		17.9		1.6pp		24.8		24.8		0.0pp		0.1pp
Profit after tax		534		520		3		667		689		–3
Basic earnings per share (€)		0.45		0.44		3		0.56		0.58		–3
Calculated cloud billings		227		164		38		228		186		23		36
Number of employees (FTE)		66,750		64,598		3		N/A		N/A		N/A		N/A

1)	All figures are unaudited.

2)	For a detailed description of SAP’s non-IFRS measures see Explanation of Non-IFRS Measures online. For a breakdown of the individual adjustments see page F7 in the appendix to this press release.

IFRS cloud subscriptions and support revenue was €219 million (2013: €137 million), an increase of 60%. Non-IFRS cloud subscriptions and support revenue was €221 million (2013: €167 million), an increase of 32% (38% at constant currencies). IFRS software and support revenue was €2.84 billion (2013: €2.77 billion), an increase of 3%. Non-IFRS software and support revenue was €2.84 billion (2013: €2.77 billion), an increase of 2% (7% at constant currencies). IFRS software and software-related service revenue was €3.06 billion (2013: €2.90 billion), an increase of 5%. Non-IFRS software and software-related service revenue was €3.06 billion (2013: €2.94 billion), an increase of 4% (9% at constant currencies). IFRS total revenue was €3.70 billion (2013: €3.60 billion), an increase of 3%. Non-IFRS total revenue was €3.70 billion (2013: €3.64 billion), an increase of 2% (6% at constant currencies).

IFRS operating profit was €723 million (2013: €646 million), an increase of 12%. This is a higher increase than the 2% growth (7% at constant currencies) in Non-IFRS operating profit (€919 million in 2014, €901 million in 2013) mainly due to a lower impact from acquisitions (deferred revenue write downs and acquisition-related charges) compared to 2013. IFRS operating margin was 19.5% (2013: 17.9%), an increase of 1.6 percentage points. Non-IFRS operating margin was 24.8% (2013: 24.8%), or 24.9% at constant currencies, an increase 0.1 percentage points at constant currencies.

IFRS profit after tax was €534 million (2013: €520 million), an increase of 3%. Non-IFRS profit after tax was €667 million (2013: €689 million), a decrease of 3%. IFRS basic earnings per share was €0.45 (2013: €0.44), an increase of 3%. Non-IFRS basic earnings per share was €0.56 (2013: €0.58), a decrease of 3%. The IFRS and non-IFRS effective tax rates in the first quarter of 2014 were 24.1% (2013: 16.3%) and 25.9% (2013: 21.4%), respectively.

Cash Flow – First Quarter 2014

Operating cash flow was €2.35 billion (2013: €2.16 billion), an increase of 9% year-over-year. Free cash flow was €2.22 billion (2013: €2.05 billion), an increase of 8% year-over-year. Free cash flow was 60% of


*SAP Reports First Quarter 2014 Results*			Page 5

total revenue (2013: 57%). At March 31, 2014, SAP had a total group liquidity of €5.06 billion (December 31, 2013: €2.84 billion), which includes cash and cash equivalents and short term investments. Net liquidity at March 31, 2014 was €750 million compared to -€1.47 billion at December 31, 2013.

BUSINESS OUTLOOK 2014

The Company reiterates the outlook for the full-year 2014, which remains unchanged from the outlook provided on January 21, 2014:

•

The Company expects full year 2014 non-IFRS cloud subscriptions and support revenue to be in a range of €950 – €1,000 million at constant currencies (2013: €757 million). The upper end of this range represents a growth rate of 32% which is similar to the respective 2013 growth rate after adjusting for acquisitions.

•

The Company expects full year 2014 non-IFRS software and software-related service revenue to increase by 6% – 8% at constant currencies (2013: €14.03 billion).

•

The Company expects full-year 2014 non-IFRS operating profit to be in a range of €5.8 billion – €6.0 billion at constant currencies (2013: €5.51 billion).

While the Company’s full-year 2014 business outlook is at constant currency, actual currency reported figures are expected to continue to be negatively impacted by currency exchange rate fluctuations. If exchange rates remain at the March 2014 level for the rest of the year, the Company expects non-IFRS software and software-related service revenue and non-IFRS operating profit growth rates at actual currency to experience a negative currency impact of approximately 6 percentage points and 8 percentage points respectively for the second quarter of 2014 and of approximately 4 percentage points and 5 percentage points respectively for the full year 2014.

The above mentioned indication for the expected currency exchange rate impact on actual currency reported figures replaces the earlier indication disclosed in SAP’s Annual Report on Form 20-F filed on March 21^st, 2014.


*SAP Reports First Quarter 2014 Results*			Page 6

Additional Information

2014 revenue and profit figures include the revenue and profits from hybris. The comparative numbers for 2013 do not include hybris until August 1, 2013.

For a more detailed description of all of SAP’s non-IFRS measures and their limitations as well as our constant currency and free cash flow figures see Explanation of Non-IFRS Measures online.

# #

First Quarter 2014 Interim Report

SAP’s first quarter 2014 Interim Report was published today and is available for download at www.sap.com/investor.

Webcast

SAP senior management will host a conference call for financial analysts and media on Thursday, April 17th at 2:00 PM (CEST) / 1:00 PM (GMT) / 8:00 AM (EDT) / 5:00 AM (PDT). The conference call will be web cast live on the Company’s website at www.sap.com/investor and will be available for replay.

About SAP

As market leader in enterprise application software, SAP (NYSE: SAP) helps companies of all sizes and industries run better. From back office to boardroom, warehouse to storefront, desktop to mobile device – SAP empowers people and organizations to work together more efficiently and use business insight more effectively to stay ahead of the competition. SAP applications and services enable more than 258,000 customers to operate profitably, adapt continuously, and grow sustainably. For more information, visit www.sap.com.

# # #

Any statements contained in this document that are not historical facts are forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Words such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “project,” “predict,” “should” and “will” and similar expressions as they relate to SAP are intended to identify such forward-looking statements. SAP undertakes no obligation to publicly 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 SAP’s future financial results are discussed more fully in SAP’s filings with the U.S. Securities and Exchange Commission (“SEC”), including SAP’s most recent Annual Report on Form 20-F filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates.

No part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of SAP AG. The information contained herein may be changed without prior notice.

Some software products marketed by SAP AG and its distributors contain proprietary software components of other software vendors. National product specifications may vary.

These materials are provided by SAP AG and its affiliated companies (“SAP Group”) for informational purposes only, without representation or warranty of any kind, and SAP Group shall not be liable for errors or omissions with respect to the materials. The only warranties for SAP Group products and services are those that are set forth in the express warranty statements accompanying such products and services, if any. Nothing herein should be construed as constituting an additional warranty.

SAP and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP AG (or an SAP affiliate company) in Germany and other countries. Please see http://www.sap.com/corporate-en/legal/copyright/index.epx#trademark for additional trademark information and notices.

Note to editors:

To preview and download broadcast-standard stock footage and press photos digitally, please visit www.sap.com/photos. On this platform, you can find high resolution material for your media channels. To view video stories on diverse topics, visit www.sap-tv.com. From this site, you can embed videos into your own Web pages, share video via e-mail links and subscribe to RSS feeds from SAP TV.


*SAP Reports First Quarter 2014 Results*			Page 7

For customers interested in learning more about SAP products:

Global Customer Center: +49 180 534-34-24

United States Only: 1 (800) 872-1SAP (1-800-872-1727)

For more information, financial community only:

Stefan Gruber +49 (6227) 7-44872 investor@sap.com, CET

For more information, press only:

Christoph Liedtke +49 (6227) 7-50383 christoph.liedtke@sap.com, CET

Daniel Reinhardt +49(6227)7-40201 daniel.reinhardt@sap.com, CET

Jim Dever +1(610)661-2161 james.dever@sap.com, ET

Claudia Cortes +65 6664-4450 claudia.cortes@sap.com, SGT (GMT +8)

Follow SAP Investor Relations on Twitter at @sapinvestor.

Appendix – Financial Information to Follow

LOGO

FINANCIAL INFORMATION

FOR THE FIRST QUARTER 2014

(Condensed and Unaudited)


	Page


Financial Statements (IFRS, Unaudited)
Consolidated Income Statements		F1
Consolidated Statements of Financial Position		F2
Consolidated Statements of Cash Flows		F3

Supplementary Financial Information (Unaudited)
Reconciliation from Non-IFRS Numbers to IFRS Numbers		F4-F5
Calculated Cloud Billings		F6
Explanation of Non-IFRS Adjustments		F7
Revenue by Region		F8

Financial Statements (IFRS, Unaudited)

CONSOLIDATED INCOME STATEMENTS OF SAP GROUP

For the three months ended March 31

€ millions, unless otherwise stated

2014

2013

Change
in %

Cloud subscriptions and support

219

137

Software

623

657

–5

Support

2,213

2,109

Software and support

2,836

2,765

Software and software-related service revenue

3,055

2,903

Professional services and other service revenue

643

698

–8

Total revenue

3,698

3,601

Cost of software and software-related services

–645

–604

Cost of professional services and other services

–591

–605

–2

Total cost of revenue

–1,236

–1,210

Gross profit

2,462

2,391

Research and development

–549

–557

–1

Sales and marketing

–968

–975

–1

General and administration

–205

–197

Restructuring

–15

–13

TomorrowNow litigation

–1

<–100

Other operating income/expense, net

–2

–3

–51

Total operating expenses

–2,975

–2,955

Operating profit

723

646

Other non-operating income/expense, net

–11

–10

Finance income

–26

Finance costs

–31

–44

–31

Financial income, net

–9

–15

–41

Profit before tax

704

621

Income tax expense

–170

–101

Profit after tax

534

520

Profit attributable to non-controlling interests

<–100

Profit attributable to owners of parent

534

520

Earnings per share, basic (in €)*

0.45

0.44

Earnings per share, diluted (in €)*

0.45

0.44

*	For the three months ended March 31, 2014 and 2013, the weighted average number of shares was 1,194 million (diluted 1,196 million) and 1,193 million (diluted: 1,195 million), respectively (treasury stock excluded).

Due to rounding, numbers may not add up precisely.

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION OF SAP GROUP

as at March 31, 2014 and December 31, 2013


€ millions	2014		2013
Cash and cash equivalents		4,513		2,748
Other financial assets		705		251
Trade and other receivables		3,867		3,865
Other non-financial assets		432		346
Tax assets		147		142
Total current assets		9,664		7,352

Goodwill		13,694		13,688
Intangible assets		2,824		2,956
Property, plant, and equipment		1,832		1,820
Other financial assets		653		607
Trade and other receivables		73		98
Other non-financial assets		79		107
Tax assets		181		172
Deferred tax assets		348		294
Total non-current assets		19,685		19,742
Total assets		29,349		27,094

as at March 31, 2014 and December 31, 2013


€ millions	2014		2013
Trade and other payables		818		850
Tax liabilities		235		433
Financial liabilities		762		748
Other non-financial liabilities		1,567		2,263
Provision TomorrowNow litigation		224		223
Other provisions		265		422
Provisions		489		645
Deferred income		4,118		1,408

Total current liabilities		7,990		6,347

Trade and other payables		43		45
Tax liabilities		329		318
Financial liabilities		3,766		3,758
Other non-financial liabilities		115		112
Provisions		320		278
Deferred tax liabilities		102		115
Deferred income		67		74

Total non-current liabilities		4,744		4,699
Total liabilities		12,734		11,046

Issued capital		1,229		1,229
Share premium		566		551
Retained earnings		16,794		16,258
Other components of equity		–704		–718
Treasury shares		–1,276		–1,280
Equity attributable to owners of parent		16,609		16,040

Non-controlling interests		7		8
Total equity		16,616		16,048
Total equity and liabilities		29,349		27,094

Due to rounding, numbers may not add up precisely.

CONSOLIDATED STATEMENTS OF CASH FLOWS OF SAP GROUP

For the three months ended March 31


€ millions	2014		2013
Profit after tax		534		520
Adjustments to reconcile profit after taxes to net cash provided by operating activities:
Depreciation and amortization		235		233
Income tax expense		170		101
Financial income, net		9		15
Decrease/increase in sales and bad debt allowances on trade receivables		15		24
Other adjustments for non-cash items		24		17
Decrease/increase in trade and other receivables		–17		97
Decrease/increase in other assets		–86		–81
Decrease/increase in trade payables, provisions, and other liabilities		–827		–881
Decrease/increase in deferred income		2,727		2,446
Interest paid		–17		–7
Interest received		12		15
Income taxes paid, net of refunds		–427		–337

Net cash flows from operating activities		2,352		2,162

Business combinations, net of cash and cash equivalents acquired		–3		–12
Purchase of intangible assets and property, plant, and equipment		–130		–113
Proceeds from sales of intangible assets or property, plant, and equipment		14		12
Purchase of equity or debt instruments of other entities		–562		–250
Proceeds from sales of equity or debt instruments of other entities		85		143

Net cash flows from investing activities		–596		–220

Proceeds from reissuance of treasury shares		5		4

Net cash flows from financing activities		5		4

Effect of foreign exchange rates on cash and cash equivalents		4		50
Net decrease/increase in cash and cash equivalents		1,765		1,996
Cash and cash equivalents at the beginning of the period		2,748		2,477
Cash and cash equivalents at the end of the period		4,513		4,473

Due to rounding, numbers may not add up precisely.

SUPPLEMENTARY FINANCIAL INFORMATION

(UNAUDITED)

RECONCILIATION FROM NON-IFRS NUMBERS TO IFRS NUMBERS

The following table presents a reconciliation from our non-IFRS numbers (including our non-IFRS at constant currency numbers) to the respective most comparable IFRS numbers. Note: Our non-IFRS numbers are not prepared under a comprehensive set of accounting rules or principles.


	For the three months ended March 31
€ millions, unless otherwise stated	2014										2013						Change in %
	IFRS		Adj.*		Non- IFRS*		Currency Impact**		Non-IFRS Constant Currency**		IFRS		Adj.*		Non- IFRS*		IFRS		Non- IFRS*		Non-IFRS Constant Currency**
*Revenue Numbers*
Cloud subscriptions and support		219		1		221		10		231		137		30		167		60		32		38
Software		623		0		623		37		660		657		0		657		–5		–5		1
Support		2,213		2		2,214		83		2,297		2,109		4		2,113		5		5		9
Software and support		2,836		2		2,838		120		2,958		2,765		4		2,770		3		2		7
Software and software-related service revenue		3,055		3		3,058		130		3,189		2,903		35		2,937		5		4		9
Professional services and other service revenue		643		0		643		30		673		698		0		698		–8		–8		–4
thereof cloud-related		43		0		43		2		45		43		0		43		0		0		5

Total revenue		3,698		3		3,701		161		3,862		3,601		35		3,636		3		2		6

Cloud subscriptions and support		219		1		221		10		231		137		30		167		60		32		38
Cloud-related professional services revenue		43		0		43		2		45		43		0		43		0		0		5

Cloud revenue		262		1		264		12		276		180		30		210		46		25		31

*Operating Expense Numbers*
Cost of software and software-related services		–645		79		–566						–604		97		–507		7		12
thereof cloud		–84		19		–65						–82		36		–46		2		41
Cost of professional services and other services		–591		25		–566						–605		28		–578		–2		–2

Total cost of revenue		–1,236		105		–1,132						–1,210		125		–1,084		2		4

Gross profit		2,462		108		2,570						2,391		160		2,551		3		1
Research and development		–549		23		–526						–557		22		–535		–1		–2
Sales and marketing		–968		34		–934						–975		52		–923		–1		1
General and administration		–205		15		–189						–197		9		–188		4		1
Restructuring		–15		15		0						–13		13		0		14		0
TomorrowNow litigation		–1		1		0						0		0		0		<–100		0
Other operating income/expense, net		–2		0		–2						–3		0		–3		–51		–51

Total operating expenses		–2,975		193		–2,782		–118		–2,900		–2,955		221		–2,734		1		2		6

*Profit Numbers*
Operating profit		723		196		919		43		962		646		255		901		12		2		7
Other non-operating income/expense, net		–11		0		–11						–10		0		–10		6		6
Finance income		22		0		22						30		0		30		–26		–26
Finance costs		–31		0		–31						–44		0		–44		–31		–31

Financial income, net		–9		0		–9						–15		0		–15		–41		–41

Profit before tax		704		196		900						621		255		877		13		3
Income tax expense		–170		–64		–233						–101		–86		–188		68		24

Profit after tax		534		133		667						520		169		689		3		–3
Profit attributable to non-controlling interests		0		0		0						0		0		0		<–100		<–100
Profit attributable to owners of parent		534		133		667						520		169		689		3		–3

*Key Ratios*
Operating margin (in %)		19.5				24.8				24.9		17.9				24.8		1.6pp		0.0pp		0.1pp
Effective tax rate (in %)		24.1				25.9						16.3				21.4		7.8pp		4.5pp
Earnings per share, basic (in €)*		0.45				0.56						0.44				0.58		3		–3

Adjustments in the revenue line items are for support revenue, cloud subscriptions and support revenue, and other similarly recurring revenues that entities acquired by SAP would have recognized had they remained stand-alone entities but that SAP is not permitted to recognize as revenue under IFRS as a result of business combination accounting rules. Adjustments in the operating expense line items are for acquisition-related charges, share-based compensation expenses, restructuring expenses, and discontinued activities.

Constant currency revenue and operating income figures are calculated by translating revenue and operating income of the current period using the average exchange rates from the previous year’s respective period instead of the current period. Constant currency period-over-period changes are calculated by comparing the current year’s non-IFRS constant currency numbers with the non-IFRS number of the previous year’s respective period.

For a more detailed description of these adjustments and their limitations as well as our constant currency figures, see our Web site www.sap.com/corporate-en/investors/newsandreports/reporting-framework.epx under “Non-IFRS Measures and Estimates”.

Due to rounding, numbers may not add up precisely.

CALCULATED CLOUD BILLINGS

The following table presents the calculated cloud billings metric which we define as the total of a period’s cloud subscription and support revenue and of the respective period’s change in the deferred cloud subscription and support revenue balance. The table also reconciles the non-IFRS calculated cloud billings metric (including our non-IFRS at constant currency metric) to the respective IFRS based calculated cloud billings metric.


	For the three months ended March 31
€ millions, unless otherwise stated	2014										2013
	IFRS		Adj.*		Non- IFRS*		Currency Impact**		Non-IFRS Constant Currency**		IFRS		Adj.*		Non- IFRS*		Currency Impact**		Non-IFRS Constant Currency**

Cloud subscriptions and support		219		1		221		10		231		137		30		167		0		167
Closing balance deferred cloud subscriptions and support		451		3		454		18		472		344		33		377		–11		366
Opening balance deferred cloud subscriptions and support		443		4		447		18		465		317		40		358		0		358
Change in deferred cloud subscriptions and support		8		–1		7		0		7		27		–7		19		–11		8
Calculated cloud billings		227		0		228		10		238		164		23		186		–11		175

Year-over-year changes (2014 vs. 2013, in %)		38				23				36

Adjustments in the revenue and deferred revenue line items are for cloud subscriptions and support revenue, and other similarly recurring revenues that entities acquired by SAP would have recognized had they remained stand-alone entities but that SAP is not permitted to recognize as revenue under IFRS as a result of business combination accounting rules.

Constant currency revenue figures are calculated by translating revenue of the current period using the average exchange rates from the previous year’s respective period instead of the current period. Constant currency deferred revenue balances are calculated by translating the current period’s opening and closing deferred revenue balances as well as the comparative period’s closing deferred revenue balance using the opening exchange rates of the comparative period.

Due to rounding, numbers may not add up precisely.

EXPLANATION OF NON-IFRS ADJUSTMENTS


€ millions, unless otherwise stated	1/1 - 3/31/2014		1/1 - 3/31/2013
Software and software-related service revenue (IFRS)		3,055		2,903
Adjustment for deferred revenue write-down		3		35
Software and software-related service revenue (Non-IFRS)		3,058		2,937

Operating profit (IFRS)		723		646
Revenue Adjustments (per above)		3		35
Adjustment for discontinued activities		1		0
Adjustment for acquisition-related charges		130		137
Adjustment for stock-based compensation expenses		48		70
Adjustment for restructuring		15		13
Operating expense adjustments		193		221
Operating profit adjustments		196		255
Operating profit (Non-IFRS)		919		901

Profit after tax (IFRS)		534		520
Revenue adjustments (per above)		3		35
Operating profit expense adjustments (per above)		193		221
Adjustments pre-tax		196		255
Taxes on adjustments		–64		–86
Profit after tax (Non-IFRS)		667		689

Due to rounding, numbers may not add up precisely.

REVENUE BY REGION

The following table presents our IFRS and non-IFRS revenue by region based on customer location. The table also presents a reconciliation from our non-IFRS revenue (including our non-IFRS revenue at constant currency) to the respective most comparable IFRS revenue.

Note: Our non- IFRS revenues are not prepared under a comprehensive set of accounting rules or principles.


	For the three months ended March 31
€ millions	2014										2013						Change in %
	IFRS		Adj.*		Non- IFRS*		Currency Impact**		Non-IFRS Constant Currency**		IFRS		Adj.*		Non- IFRS*		IFRS		Non- IFRS*		Non-IFRS Constant Currency**
Cloud subscriptions and support revenue by region

EMEA		54		0		54		2		56		40		0		40		35		35		39
Americas		147		1		148		7		155		83		30		113		77		30		37
APJ		19		0		19		1		20		14		0		14		33		33		43

Cloud subscriptions and support revenue		219		1		221		10		231		137		30		167		60		32		38

Software and software-related service revenue by region

EMEA		1,439		1		1,440		24		1,463		1,351		0		1,351		7		7		8
Americas		1,180		2		1,182		63		1,245		1,092		35		1,127		8		5		10
APJ		436		0		436		44		481		460		0		460	–	5	–	5		4

Software and software-related service revenue		3,055		3		3,058		130		3,189		2,903		35		2,937		5		4		9

Total revenue by region
Germany		535		0		535		0		535		528		0		528		1		1		1
Rest of EMEA		1,233		1		1,234		30		1,264		1,150		0		1,150		7		7		10
Total EMEA		1,768		1		1,769		30		1,799		1,678		0		1,678		5		5		7
United States		1,064		1		1,065		44		1,109		985		35		1,019		8		4		9
Rest of Americas		356		0		356		33		390		385		0		385		–8		–7		1
Total Americas		1,419		2		1,421		78		1,499		1,370		35		1,404		4		1		7
Japan		129		0		129		19		149		153		0		153		–15		–15		–3
Rest of APJ		382		0		382		34		416		401		0		401		–5		–5		4
Total APJ		511		0		511		53		564		553		0		553		–8		–8		2
Total revenue		3,698		3		3,701		161		3,862		3,601		35		3,636		3		2		6

Constant currency revenue figures are calculated by translating revenue of the current period using the average exchange rates from the previous year’s respective period instead of the current period. Constant currency period-over-period changes are calculated by comparing the current year’s non-IFRS constant currency numbers with the non-IFRS number of the previous year’s respective period.

Due to rounding, numbers may not add up precisely.

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Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents