Business Context and Reporting Period
This Form 6-K filing by SAP SE (SAP Aktiengesellschaft) dated January 13, 2004, incorporates an Ad-Hoc release regarding preliminary financial results for the fourth quarter and full year ended December 31, 2003. SAP is a global provider of business software solutions. The filing notes that detailed results will be provided on January 22, 2004.
Key Financial Metrics
Fourth Quarter 2003 (Preliminary)
- Software Revenues: Approximately €930 million (down 3% reported vs. Q4 2002; up 4% on a constant currency basis).
- Total Revenues: Approximately €2.2 billion (down 3% reported vs. Q4 2002; up 4% on a constant currency basis).
Full Year 2003 (Preliminary)
- Software Revenues: Approximately €2.15 billion (down 6% reported vs. 2002; up 1% on a constant currency basis).
- Total Revenues: Slightly above €7.0 billion (down 5% reported vs. 2002; up 3% on a constant currency basis).
- Pro Forma Operating Margin: Expected to increase by approximately 4 percentage points to around 27% (2002: 23%).
- Adjustments: Pro forma margin excludes stock-based compensation (approx. €130 million) and acquisition-related charges (approx. €24 million).
The filing does not provide specific values for net profit, cash flow, debt, or liquidity metrics.
Material Changes vs. Prior Period
Reported revenues declined year-over-year for both the fourth quarter and the full year 2003 due to unfavorable currency fluctuations. However, on a constant currency basis, both software and total revenues grew in the fourth quarter (4%) and the full year (1% for software, 3% for total). Profitability improved significantly, with the pro forma operating margin rising from 23% in 2002 to an expected 27% in 2003.
Guidance, Outlook, and Risks
SAP expects to significantly exceed its previously published targets for pro forma operating margin and pro forma earnings per share. The company attributes revenue performance mainly to strong results in the United States and Germany. The filing includes standard forward-looking statement disclaimers, noting that actual results may differ materially due to various risks and uncertainties discussed in prior SEC filings.
Investor Verification Checklist
- Verify the final audited figures for Q4 and full-year 2003 when released on January 22, 2004.
- Confirm the reconciliation of pro forma operating margin to GAAP operating margin, specifically the treatment of the €130 million stock-based compensation and €24 million acquisition charges.
- Assess the impact of currency fluctuations on reported versus constant currency revenue growth.
- Review the detailed breakdown of revenue by region and product line in the upcoming full report.