INVESTOR RELATIONS FACTBOOK/media/Files/S/... · Consulting Services •IT Strategy & Design...

INVESTOR RELATIONS FACTBOOK

December 2018

© 2018 Software AG. All rights reserved.

2 |

This presentation includes forward-looking statements based on the beliefs of Software AG management.

Such statements reflect current views of Software AG with respect to future events and results and are

subject to risks and uncertainties. Actual results may vary materially from those projected here, due to

factors including changes in general economic and business conditions, changes in currency exchange,

the introduction of competing products, lack of market acceptance of new products, services or techno-

logies and changes in business strategy. Software AG does not intend or assume any obligation to update

these forward-looking statements.

This presentation constitutes neither an offer nor recommendation to subscribe or buy in any other way

securities of Software AG or any of the companies that are members of the Group at present or in the

future, nor does it form part of such an offer and it should not be understood as such. This presentation

does not constitute an offer of sale of securities in the United States of America. Securities may not be

offered or sold in the United States of America without registration or exemption from registration in

accordance with the U.S. Securities‘ Act of 1933 in its currently valid form.


SAFE-HARBOR-STATEMENT

1 |

A DAY IN THE LIFE OF SOFTWARE AG

06.15


2 |


06.59


3 |


07.45


4 |


10.00


5 |


11.15


6 |


13.00


7 |


17.00


8 |


17.30


9 |


18.00


3 |

SOFTWARE AG AT A GLANCE


Technology leader for almost 50 years in data management

and application development platforms

~ €3bn MARKETCAP

~ 66% Free Float

€870+ MILLION

IN REVENUE

50%+ recurring

75% product revenue

4,500+ EMPLOYEES**

R&D 26%

S&M 19%

Consulting

&Services

42%

Admin

13%

BY REGION*

* Based on FY 2017 **P&L as of December 31, 2017

43%

Americas

49%

EMEA

REVENUE

52%

DBP

25%

A&N

23%

Services

BY BUSINESS LINES*

4 |

Adabas & Natural

(Heritage)

• Application Development

• Data Management

System

• Modernization (e.g. ZiiP)

• System Support 2050+

BUSINESS LINES


*Group revenue split FY 2017

Share of

Revenue* 52%

Digital Business

Platform (Core)

• Integration &

Automation

• Real-time Analytics

& Decisions

• In-Memory Data

• Business & IT

Transformation

Share of

Revenue*

Consulting Services

(Professional Services)

• IT Strategy & Design

• Product Implementation &

Customized Solutions

• Education & Cloud

Services

• Global Delivery (on-

/offshore)

Share of

Revenue* 25% 23%

Cloud & IoT

(Extension)

• IoT solutions

• Industry 4.0/IIoT

Platform Device

Management

• Edge Computing

• Cloud-based

software

5 |

Revenue in €m:

DBP Product revenue

A&N Product revenue

PROFITABLE GROWTH


STRATEGY EXECUTION

2006 2017

284 224

455

Adabas & Natural

Extending Lifecycle

69

31.8%

24.7%

2012

EBITDA

EBITA, non-IFRS

Operating margin

2019

Project Helix Strategy Refresh

6 |

INFLECTION POINTS


WHEN DIGITAL BUSINESS PLATFORM TAKES THE LEAD

0%

20%

40%

60%

80%

100%

2010

License Revenue

0%

20%

40%

60%

80%

100% Maintenance Revenue

2012

0%

20%

40%

60%

80%

100% Business Segment Result

Adabas & Natural

Digital Business Platform

2018e

7 |

INDEX


Key Investment Indicators 1. 8

Business Model, Characteristics & GTM 2. 22

Markets, Positioning & Competition 3. 27

Digital Business Platform – Core Capabilities 4. 32

Customers References & Use Cases 6. 54

Financials 7. 61

Shares & Ownership 8. 81

IoT Platform – Offering and Core Capabilities 5. 36

8 |

1. KEY INVESTMENT INDICATORS


9 |

KEY INVESTMENT INDICATORS


1. Footprint: Established global player in enterprise software

• Blue Chip customer base built for almost 50 years

• Risk-balanced revenue by industry and geography

• Experienced management team and loyal expert staff

2. USP: Technology leadership and vendor neutrality

• Leadership in relevant product categories according to industry analysts

• Innovator: First Digital Business Platform

• Vendor independency allows system integration of large brands’ products

3. Financials: Solid profit base and high cash generation

• ⅔ of license revenue from growing market segments

• ½ of revenue is recurring (maintenance & SaaS)

• High operating margin (2017: 31.8%)

• Continuous return to shareholders (Dividend + SBB ≙ ¾ of free cash flow on average)

10 |

Telecom Chemicals/Pharma Energy/Utilities

Public Sector Logistic/Transport Consumer/Retail

BLUE CHIP CUSTOMER BASE


BUILT FOR ALMOST 50 YEARS (SAMPLES)

Chemicals/Pharma IoT Finance

Manufacturing

11 |

20%

19%

18% 12%

10%

Government Financial Services

IT Services Manufacturing

Services Telco & Media

Transport & Logistics Other

BALANCED RISK


REVENUE BY GEOGRAPHY AND INDUSTRY

Product Revenue by Region* Product Revenue by Industry*

43%

49%

8%

Americas

EMEA (14% Germany)

Asia Pacific

*Based on Group product revenue – FY 2017

12 |

EXPERIENCED MANAGEMENT TEAM


AND LOYAL EXPERT STAFF

Dr. Wolfram Jost

Chief Technology Officer

– since 2010 –

M&A Technical Market

Screening & Due Diligence;

Global SE Community;

Product Marketing &

Management; Industry

Analyst Relations; Co-Head

of Global Portfolio Innovation

Steering Team; Strategic

Customer Projects; Stand-

Alone Business Acquisitions

Sanjay Brahmawar Chief Executive Officer

– since 2018 –

Global Human Resources;

Global Legal; Global

Information Services (IT);

Processes, Audits,

Quality; Corporate Office;

Corporate PR; Marketing:

Corporate, Field, Digital;

Environmental, Social and

Governance (ESG)

Dr. Stefan Sigg Chief R&D Officer

– since 2017 –

Co-Head of Global Portfolio

Innovation Steering Team;

R&D Product Lines;

R&D Quality Assurance;

Architecture Team; GUI

Team; Co-Innovation

Customer Projects; Global

Support; Research

Arnd Zinnhardt Chief Financial Officer

– since 2002 –

Global Finance and

Controlling; Corporate

Investor Relations;

Treasury; Global

Purchasing; Mergers &

Acquisitions; Global

Taxes; Business

Operations

John Schweitzer Chief Customer Officer

– since 2018 –

Global Services, Sales

Regions; Global Alliance

& Channel; Global A&N

2050; Global Business

Operations: Industries,

Inside Sales; Sales

Operations; Sales

Enablement/Customer

Engagement

13 |





• Risk-balanced revenue by industry and geography










• Continuous return to shareholders (dividend + SBB ≙ ¾ of free cash flow on average)

14 |

• Enterprise Architecture Tools,

October 2018

• Full Life Cycle API Management,

April 2018

• Integrated IT Portfolio Analysis Applications,

November 2017

• Enterprise Architecture Tools, May 2017

• The Forrester WaveTM: API Management

Solutions, Q4 2018

• The Forrester WaveTM: Streaming Analytics,

Q3 2017

• The Forrester WaveTM: Digital Process

Automation, Q3 2017

• The Forrester WaveTM: Strategic Portfolio

Management, Q3 2017

• The Forrester WaveTM: Enterprise Architecture

Management, Q2 2017

• The Forrester WaveTM: Hybrid Integration For

Enterprises, Q4 2016,

TECHNOLOGY LEADERSHIP


SOFTWARE AG IS A LEADER IN 9 MARKETS

Gartner is a registered trademark and service mark of Gartner, Inc. and/or its affiliates in the U.S. and

internationally, and is used herein with permission. All rights reserved.

Gartner does not endorse any vendor, product or service depicted in its research publications, and does not

advise technology users to select only those vendors with the highest ratings or other designations. Gartner

research publications consist of the opinions of Gartner’s research organization and should not e construed as

statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including

any warranties of merchantability or fitness for a particular purpose.

All statements in this report attributable to Gartner represent Software AG interpretation of data, research opinion

or viewpoints published as part of a syndicated subscription service by Gartner, Inc., and have not been reviewed

by Gartner. Each Gartner publication speaks as of its original publication date (and not as of the date of this

Presentation/Factbook). The opinions expressed in Gartner publications are not representations of fact, and are

subject to change without notice.

MAGIC QUADRANTS

For further information please follow the link.

https://www.softwareag.com/corporate/company/awards_analyst/default.html

15 | © 2018 Software AG. All rights reserved.

WORLD’S

1st

High-performance

transactional database

ADABAS &

NATURAL

THE FIRST

B2B server and

SOA integration

platform

WEBMETHODS

THE FIRST

Business process

analysis and

design platform

ARIS

THE FIRST

Big data & streaming

analytics platform

TERRACOTTA

APAMA

THE FIRST

True IoT

cloud platform

CUMULOCITY IoT

THE FIRST

INNOVATOR FOR COMPETITIVE DIFFERENTIATION

16 |

We will not lock

customers into

proprietary systems.

We make all leading

databases and application

platforms work in synergy

with one another.

NEUTRAL BECAUSE WE ARE


VENDOR INDEPENDENT

Our solutions work in

harmony with the existing

IT landscape.

17 |





• Risk balanced revenue by industry and geography










• Continuous return to shareholders (Dividend + SBB ≙ ¾ of free cash flow on average)

18 |

LICENSE REVENUE: ⅔ FROM GROWING IT MARKETS


0%

20%

40%

60%

80%

100%

2006 2008 2010 2012 2014 2016 2017

A&N

DBP

DBP offering focused on IT digitization segments, like IoT, streaming analytics etc.

19 |

RECURRING REVENUE


0

100

200

300

400

2010 2011 2012 2013 2014 2015 2016 2017

A&N

DBP

353 362 378 369 369

407 in €m

48%

maintenance

>90% recurring

412 429

MAINTENANCE & SAAS

Maintenance

& SaaS

63% of

Product

Revenue is

recurring

New KPI for DBP

Annual Recurring Revenue (as of Sept. 30, 2018)

DBP 209€m +11% yoy, acc.

thereof Cloud & IoT 27€m +111% yoy, acc.

20 |

200

300

400

500

600

2017 2019 2021 2023 2025

*renewal rate ca. 93-95%

400

500

600

700

800

2017 2019 2021 2023 2025


A) +10% CAGR

B) flat

€m

€m

€m

MAINTENANCE REVENUE SHOWS COMPOUND GROWTH

DBP maintenance:

Renewal rate: 93% (2018), 94% (2019-2021), 95% (2022-2025)

Net new maintenance ≙ 18% of license p.y.

Stable churn rate: - 4% CAGR

(regardless of license revenue)

DBP license growth:

A

A

B

B

Model assumptions:

A&N maintenance:

21 |

31.2% 29.7%

26.8%

27.9%

SOFTWARE AG


INVESTMENT KPI

44%

mainte-

nance

32%

license

24%

consulting

Growing share of product and recurring revenues

€0.55

€0.65

2015 2017

Dividend increase

Free cash flow

conversion rate

>100% of

net profit.

20%

60%

100%

140%

180%

Operating margin*

FY 2014 * non-IFRS EBITA in % of revenue FY 2017

49%

mainte-

nance &

SaaS

28%

license

23%

consulting

30 – 32%

(2018 target)

Cash-out ratio:

25 – 33%

31.8%

FY 2013

FY 2014

FY 2015

FY 2016

FY 2017


2. BUSINESS MODEL, CHARACTERISTICS & GTM

23 |

0%

10%

20%

30%

40%

50%

Q1 Q2 Q3 Q4

License Maintenance Services

BUSINESS MODEL


REVENUE STRUCTURE & LICENSE VOLATILITY License:

• Direct sales, partners and ecosystems

• Traditional: Perpetual or term license

• New: subscription and pay per use

• Pricing based on Capacity (HW:CPU, Devices; SW: Data Volume)

Maintenance + SaaS:

• Recurring Revenue (renewal rate >90%)

• Maintenance pricing based on license:

• DBP: up to 22% (new); (≤20% installed)

• A&N: 15% (mainframe); 20% (other)

Consulting Services:

• Implementing own products (focus)

• Cost-plus or fixed-price projects

• Own staff + freelance and partners

Ø quarterly share of respective

FY revenue 2014 – 2017

24 |

ACQUISITIONS SUPPORT TECHNOLOGY LEADERSHIP

Integration and BPM Business Process

Analysis Big Data (In-Memory)

2007 2008 2009 2010 2011 2012 2013

Application PaaS

2016


*A&N Portfolio (all other DBP)

Internet of

Things

2017

Artificial

Intelligence

* *

Streaming

Analytics

2018

25 |

OUR PARTNER ECOSYSTEM A FORCE MULTIPLIER FOR SUCCESS

Selection of Strategic Global Alliance Partners

Increase value:

• Increasing implementation success rate by extended partner service capabilities

• Reducing time-to-value through broad industry and vertical footprint

• Accelerating innovation & solutions to provide systems of differentiation

• Providing effective sales and service delivery due to local coverage

• Managing successfully the transformation into a true DIGITAL business


26 |

Capabilities Benefits

ADABAS Data Management System

• Data management for high-performance

transaction processing

• Multi-platform availability

• Faster and more reliable data processing

• Easy data share with other systems

• Data management on platform of choice

NATURAL Application Development

• Platform for developing and operating

enterprise applications

• Eclipse™-based tool environment

• Cross-platform deployment

• Rapid delivery of applications

• Faster meeting of business demands

• Business logic retention independent of

platform decision

ADABAS & NATURAL Application Modernization

• Improving end-user experience and

interoperability of applications

• Leveraging new technologies—the Web,

mobile, SOA or big data

• Retaining investments without risk

• Increasing end-user productivity

• Accelerating innovation

ADABAS & NATURAL


TRANSACTION PROCESSING


3. MARKETS, POSITIONING & COMPETITION

28 |

DIGITIZATION WEDGE SEPARATES


DIGITAL DISRUPTION Digital Disruption

Internet of Things

Smart Business

Connected Customers

CUSTOMERS FROM ESTABLISHED COMPANIES

Retail Pharma Insurance Mobility … any industry! Manufacturing


Retail

Consumer

centric

supply

chains

Platform

as a

retailer

PROCESS

INNOVATION

Pharma

Personalized

medicine

Health card

as a

medical

service

platform

PRODUCT

INNOVATION

Individualized

production

Smart

products (I 4.0, MES, IoT)

Predictive

solutions

ORGANIZATIONAL

INNOVATION

Insurance

Platform as

a broker

Personalized

insurance

contract

SERVICE

INNOVATION

Mobility

Connected

cars

Platform

as a

broker

MOBILITY

INNOVATION

… any industry!

DIGITAL

INNOVATION!

Manufacturing

DISRUPT YOURSELF … IF NOT, OTHERS WILL OUTSTANDING CUSTOMER EXPERIENCE ENABLED BY DIGITAL PLATFORMS

http://www.google.de/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0ahUKEwjlsc6Bv8nSAhVJlxQKHcSNBu0QjRwIBw&url=http://infowebsystems.com/insurance/&bvm=bv.149093890,d.d24&psig=AFQjCNFSQzA1Zq5Kpjxj21JM3qmTHh0rEQ&ust=1489151232954630

http://www.google.de/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0ahUKEwjaurW1vsnSAhXGWxQKHW5bBesQjRwIBw&url=http://www.amrismartsourcing.com/pharma-news-2/this-week-in-pharma-45/&bvm=bv.149093890,d.d24&psig=AFQjCNHFsVRktIh9dpcByqDRLdNW__SOBg&ust=1489151113717688

https://www.google.de/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0ahUKEwi0uZKfv8nSAhWEtRQKHff7DlkQjRwIBw&url=https://convent.de/de/archiv/managed-events/connected-mobility-2016/&bvm=bv.149093890,d.d24&psig=AFQjCNHFfwWWU0q2N7dFUP_d7bhvO9B6Jw&ust=1489151351127705

https://www.google.de/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0ahUKEwj8m8jUvsnSAhVEVRQKHYT2DhQQjRwIBw&url=https://www.fcagroup.com/en-US/sustainability/we_care_about_environment/responsible_production/Pages/default.aspx&bvm=bv.149093890,d.d24&psig=AFQjCNEqmG6oYzY7pyIxpVz9RUSE3vjwaQ&ust=1489151181790942

30 |

Co-innovation through customers & vendors Innovation only through vendor

CHANGING THE GAME

Product Based

Application n

Application 2

Application 1

(Use case 1)

Microservices • Agile • Flexible/fast

Platform Based

Digital Business Logic (Innovation Layer)

DIGITAL PLATFORM

Use case 1 Use case 2 Use case n

Monolithic • Complex • Inflexible/slow

Digital Application 1 Digital Application 2 Digital Application n

PLATFORM VERSUS PRODUCT BASED INNOVATIONS


PRE-DIGITAL WORLD DIGITAL WORLD

31 |

SIMPLIFY & ACCELERATE


YOUR JOURNEY TO BECOMING A DIGITAL BUSINESS

Front office • Agile

• Innovative

• Dynamic

• Differentiating

Customer engagement systems

Core operational systems (ERP, SCM, …)

Finance & Controlling

Order Management

Customer Management

Procurement Supply Chain Management

Digital Business Applications Agility, Speed, Innovation, Differentiation

Sales Service Support

DIGITAL BUSINESS PLATFORM

Marketing

Sales

Back office • Stable

• Reliable

• Efficient

• Standardized


4. DIGITAL BUSINESS PLATFORM – CORE CAPABILITIES

33 |

Core ERP (SOR) Legacy BI Things

PaaS SaaS

THE NEW DIGITAL IT ARCHITECTURE BIMODAL AND INTEGRATION-CENTRIC

DIGITAL BUSINESS PLATFORM (PaaS Suite)

Systems of Differentiation (Digital Applications)

Big Data Partners Mobile Apps


+ HYBRID

CLOUD

ON PREMISES

EDGE

34 |



BUILDING BLOCKS

DIG

ITA

L B

US

INE

SS

PL

AT

FO

RM

BUSINESS & IT

TRANSFORMATION

powered by

ARIS & ALFABET

DEVICES powered by

CUMULOCITY

DATA &

ANALYTICS

powered by

APAMA & TERRACOTTA

PROCESS &

APPLICATIONS

powered by

WEBMETHODS

INTEGRATION &

API

powered by

WEBMETHODS

Dynamic Process

Automation

Low-Code

Applications

Hybrid

Integration

Process Transformation

& Management

Governance, Risk

& Compliance

Portfolio

Management

Enterprise Architecture

Management

Streaming Analytics &

Machine Learning

In-Memory Data &

Messaging

API

Management

Device

Connectivity

Device

Management

+ HYBRID

CLOUD

ON PREMISES

EDGE


35 |

DIG

ITA

L B

US

INE

SS

PL

AT

FO

RM



PLATFORM CAPABILITIES

BUSINESS & IT

TRANSFORMATION

PROCESS &

APPLICATIONS

DEVICES

Business Strategy

& Planning

Customer

Journeys

Design &

Analysis

Enterprise

Architecture

Portfolio

Management

Governance, Risk

& Compliance

Process

Mining

Low-Code

App Development

Mobile

Enablement

Task & Work

Management

Rules

Management

Content

Management

Dynamic

Orchestration

Process

Automation

Case

Management

Robotic Process

Automation

INTEGRATION &

API

DATA &

ANALYTICS

API

Gateway & Portal

API Lifecycle

Management Microservices

Master Data

Management

Managed

File Transfer

Application & Cloud

Integration

IoT & Big Data

Integration

B2B

Integration

Mainframe & Data

Integration

In-Memory

Store & Compute

Distributed

Caching Messaging

Event Routing &

Persistence

Alerts &

Actions

Streaming

Analytics

Machine

Learning

Edge

Analytics

Data Preparation

& Visualization

Device

Agents

Device

Connectivity

Device Lifecycle

Management

Connection

Management

Digital

Twin

Device

Operations

Cloud

Remote Access

Edge

Services

Device

Security


5. IOT PLATFORM – OFFERING AND CORE CAPABILITIES

37 |

Technology

leadership

Neutrality

Home base in highly

industrialized

Germany

Mid-size company

culture


G2M model of direct

customer ownership

Heritage of being a

software platform

company

IOT @ SOFTWARE AG USP AND SUCCESS FACTORS

38 |

HYBRID INTEGRATION


DRIVING “PERVASIVE” CONNECTIVITY

Hybrid

Integration

“Things”

Mobile Apps

Social Networks On-Premises

Applications and Data Sources

Business

Process

Networks

Business

Partners

Subsidiaries

SaaS/Cloud

Services

EDW Mart

MDM

39 |

SOFTWARE AG ACQUIRES BUILT.IO FLOW™ IPAAS TO EXTEND LEADERSHIP IN HYBRID INTEGRATION

Flow iPaaS

Connect any app, service, or

device to automate workflows

Flow Embed

Embedded connectivity into any

SaaS application

• Brings modern Node.js

technology, FaaS and

160+ new connectors

• Integrating Built.io Flow with Software

AG´s leading iPaaS, IoT, API and B2B

capabilities uniquely delivers an

unmatched integration offering

• Software AG gains

analyst recognized

iPaaS offering

© 2018 Software AG. All rights reserved. © 2018 Software AG. All rights reserved.

40 |

COMPONENTS OF AN END-TO-END IOT SOLUTION


Business challenges

• Create IoT solutions for smarter products and higher-value services

• Deliver value of IoT solutions quickly: start small & scale in iterations

• Balance risk & innovation: leverage new technologies, but stay open and flexible

• Benefit from best practice, IoT methodology and proven tools

IoT Edge Platform IoT Endpoints

ERP

CRM

SaaS

IoT Cloud Platform Enterprise Applications

Gateway

Long-range

Communication

Integration Local

Communication Edge

Server

41 |

CUMULOCITY IOT - A NEW IOT PLATFORM


COMBINING THE POWER OF CUMULOCITY WITH THE DIGITAL BUSINESS PLATFORM

42 |

IoT Framework

Scale Out (Enterprise Level)

• Cross divisional end-to-end

company processes

• Coding, professional developers

• Existing and new IoT applications

fully interwoven

Growing Maturity Level over Time

Fle

xib

ilit

y &

So

ph

isti

cati

on

DIFFERENT USER LEVELS FOR DIFFERENT CUSTOMER NEEDS

IoT SaaS

Fast Entry

• Self-service, out-of-the-box

• Pre-defined solution accelerators

IoT PaaS

Fan Out (Departmental)

• High productivity, fast go-to-market

• Smart rules

• Focus on business users

© 2018 Software AG. All rights reserved. © 2018 Software AG. All rights reserved.

43 |

USE OF MACHINE LEARNING

… operationalizes these models to

enable organizations to respond

intelligently.


… uses machine learning to allow

organizations build models that

represent patterns of behavior.

Predictive Analytics Streaming Analytics

44 |

SOFTWARE AG IOT PLATFORM SERVICES


Digital Business Platform Container

IoT

Analytics Device

Integration

Enterprise &

Cloud

Integration

IoT Integration

IoT Modeling &

Portfolio Mgmt

IoT Development

45 |

• Follows a common

technology vision

• Is already integrated in

Digital Business Platform

• Enables smarter

applications across all

industry verticals

• Important capability for IoT

use cases

• Key customer wins

• Strong telco experience

(Nokia spin-off)

• Development of IoT

platform since 2010

• Integration

• Visualization and templates

• Real-time Analytics

• Device Management

• Connectivity:

Multi protocol / machine

languages (300+ industrial

protocols)

SOFTWARE AG MAIN ACQUISITIONS FOR IOT


EXTENDS OUR TECHNOLOGY LEADERSHIP

AI, machine learning &

predictive analytics

IoT PaaS –

End-to-End Cloud Platform

• Intuitive web-based self-

service analytics platform

for rapid fire visualization

• Enables domain experts to

analyze time series data in

real-time

Time-Series Analysis

47 |

ADAMOS.COM

OUR PROMISE


Global Alliance DMG MORI, Dürr, Software AG,

ZEISS, ENGEL and ASM PT

combine forces in ADAMOS for

Industry 4.0 and are open to

additional partners.

End-to-End With ADAMOS, companies can offer

their customers, partners and suppliers

a comprehensive digitization strategy.

Broad App Portfolio The ADAMOS App Factory Alliance

concentrates the partners’ technological

expertise and industry knowledge for the

quick, collaborative development of

apps.

Digital Marketplaces Partners represent their digital expertise

through their individual identities and

market-places for their customers (e.g.

CELOS powered by ADAMOS).

Open Platform The ADAMOS IIoT platform is

manufacturer-neutral and combines

“leading-edge” IIoT technology and

industry knowledge.

Strong Set-Up ADAMOS GmbH and the ADAMOS App

Factory Alliance has launched on October

1, 2017, with approx. 200 experts, five

digital marketplaces and more than 30

apps.

1

4

2

3

5 6

49 |

ADAMOS.COM

ADAMOS TOTAL VIEW

APP FACTORY

ALLIANCE

PARTNER

ECO SYSTEMS

ADAMOS

JV

… App App

APP MARKET PLACE

APP

INNOVATION &

CERTIFICATION

COUNCIL

App App App

App App App App

ADAMOS

IoT SUITE

GOVERNANCE (Standards, Interfaces, …)

App App App App App App App

NEW

Enterprise & Cloud Integration

Device

Connectivity &

Management

Real-time

Analytics &

Visualization

Workflow

Automation …

NEW

App App

NEW


50 |

ADAMOS.COM

ADAMOS JV (ADAMOS GMBH)

ADAMOS

JV

PARTNER

ECO SYSTEMS

… App App

APP MARKET PLACE

APP INNOVATION

& CERTIFICATION

COUNCIL

App App App

App App App App

ADAMOS

IoT SUITE


NEW


Device

Connectivity &

Management

Real-time

Analytics &

Visualization

Workflow

Automation …

NEW

App App

ADAMOS

JV

APP MARKET PLACE

ADAMOS

IoT SUITE



Device

Connectivity &

Management

Real-time

Analytics &

Visualization

Workflow

Automation …

ADAMOS

JV APP MARKET PLACE

ADAMOS

IoT SUITE


General

Management

• ADAMOS JV is responsible for the

provision of state-of-the-art software

and solutions, independent of

specific software vendors (no lock-in)

• ADAMOS JV is a IaaS/PaaS

operation unit with no direct access

to customers, but responsible for

partner management

• Shareholders of ADAMOS will be

the founders and further leading

mechanical engineering companies

at equal share (Premium Partner,

max 10)

• Additional Partners (none-

shareholders) are users of the

ADAMOS platform with minimum

commitment

Supervisory

Board

Technology

Council

Pricing

Committee



Device

Connectivity &

Management

Real-time

Analytics &

Visualization

Workflow

Automation …

51 |

ADAMOS.COM

ADAMOS APP FACTORY ALLIANCE

APP FACTORY

ALLIANCE

… App App

APP MARKET PLACE

App

App App App App

ADAMOS

IoT SUITE



NEW


Device

Connectivity &

Management

Real-time

Analytics &

Visualization

Workflow

Automation …

APP FACTORY

ALLIANCE


The App Factory Alliance is a strategic cooperation of the

partners’ software divisions

Each App Factory develops primarily apps for its eco-system

owner and has also direct access to customers.

Core activities within the App Factory Alliance:

app development best practices

common standards and procedures

common app certification rules and processes

common market place for shared apps (op. by ADAMOS)

common I4.0 solutions cross partners for customers

Benefits for members are:

1. App development network

2. Large variety of applications

3. Cost efficiency: shared innovation & development

4. Reselling: own applications to other partners

5. Time-to-market: joint roadmaps, re-usability and sharing.

App App App

NEW

NEW


APP

INNOVATION &

CERTIFICATION

COUNCIL

52 |

ADAMOS.COM

ADAMOS MARKETPLACES (ECO SYSTEMS)

ADAMOS

JV APP MARKET PLACE

APP INNOVATION

& CERTIFICATION

COUNCIL

App App App

ADAMOS

IoT SUITE


NEW

• Eco systems provide apps for the

the digital market places, which are

built in the App Factory Alliance

• Each partner keeps their own digital

innovation identity to the market

• Digital market places are operated

on the ADAMOS IoT Platform

• Partners can use a market place

blue-print to get started faster

• Market places are cloud based and

have a pricing model „pay per use „

for risk sharing

• Small partners without an own

market place can use the ADAMOS

market place

PARTNER

ECO SYSTEMS

… App App App App App App

NEW

App App



Device

Connectivity &

Management

Real-time

Analytics &

Visualization

Workflow

Automation …


6. CUSTOMER REFERENCES & USE CASES

55 |

Increase operational

efficiency

Optimize use of

assets

Augment reliability

of equipment Improve product

quality

Efficiency & Optimization

Offer higher-value

services with new

revenue models

Implement “Assets as

a service” instead of

owned assets

Enhance customer

experience & new

engagements

Stay

competitive

New Business Models


SOFTWARE AG: EXAMPLE CUSTOMERS & USE CASES

56 |

APPLIED REAL-TIME INTELLIGENCE


AIR-SUPPLY MONITORING OF PAINT SYSTEMS

• Real-time signals from

paint shop robots

• Anomaly detection score

(IO / NIO)

• Detect anomalies in real-

time at the edge

(Industry PC)

• Closed-loop analytics

(real-time execution and

re-training of machine

learning models)

57 |

NORDEX: WIND FARM MANAGEMENT

Situation

• Installed wind power capacity of more than 21 GW in over 25 markets,

generating sales of EUR 3.4 billion in 2016 with 5,000 employees.

• Wind turbine manufacturing plants in Germany, Spain, Brazil, the United

States and India.

Business Needs

• Autonomous wind farm management of the critical operations at both

farm and individual turbine level based on data from numerous sensors.

• Data reduction: analyze and aggregate data onsite independent from the

cloud

• Wind turbine and farm management to be performed with the same

software architecture from edge to cloud with identical APIs, data models

and analytics.

Solution (Roll-Out)

• Cumulocity IoT Edge (200 wind turbines)

• Cumulocity IoT Cloud (Hybrid)

• Cloud Fieldbus


58 |

WIND TURBINES FEED ANALYTICS NEEDED FOR PREDICTIVE MAINTENANCE

© 2018 Software AG. All rights reserved © 2018 Software AG. All rights reserved.

59 |

> 2000* Data parameter combinations

~ 400k Crashes analyzed

10 mio. customers worldwide

Miles of driving data


380 bn.

World’s leading insurance

telematics provider (today: 40% market share)

Global car insurance market outlook

1bn+ cars worldwide on the road

TAM: ~ $650bn insurance contract volume

(Octo’s market share today: ~ $35bn)

Other services

Crash & claims

*vehicle, weather, traffic, socio-demographics …

Current statistics / figures Risk analytics

VEHICLE DATA TELEMATICS PLATFORM NEW DISRUPTIVE BUSINESS MODEL

60 |

BOSCH IOT CLOUD (BIC)


STRATEGIC CO-INNOVATION OVERVIEW

Bosch – a long-standing Software AG customer

Current co-innovation areas

for IoT & IIoT:

Use of Software AG products

within Bosch IoT Cloud (BIC)

End user tooling for Streaming

Analytics use cases

Predictive Analytics integration

Joint development of BIC services,

e.g. on “Location Awareness”

with Bosch Software Innovations Strategic

partner


7. FINANCIALS

62 |

* EPS basic, 2007 – 2010 pro-forma, adjusted for share split (2011)

in €m, IFRS 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007

Total Revenue 879.0 871.8 873.1 857.8 972.7 1,047.3 1,098.3 1,119.5 847.4 720.6 621.3

BL DBP 455.4 441.4 431.5 394.5 422.9 385.5 339.6 321.5 247.2 210.7 149.9

BL A&N 223.7 234.6 248.0 245.3 274.5 310.5 313.9 355.4 328.5 332.1 310.2

BL Consulting 199.9 195.8 193.6 218.0 275.4 351.3 444.8 441.4 271.3 177.8 161.1

Group License 256.7 263.0 271.9 270.1 330.1 318.9 295.2 327.4 269.9 272.0 241.3

Group Maintenance 421.6 412.2 406.9 371.3 375.6 393.3 378.7 369.4 310.6 267.1 212.9

EBIT 222.8 213.9 209.4 176.0 205.5 248.3 269.2 268.6 218.2 180.5 136.8

EBITA (non-IFRS) 279.5 272.0 259.1 239.3 260.7 298.9 n/a n/a n/a n/a n/a

EPS (in €, non-IFRS)* 2.38 2.37 2.22 1.96 2.07 2.31 n/a n/a n/a n/a n/a

Dividend cash out 44.3 41.9 39.5 39.5 36.3 38.2 39.9 37.0 32.6 31.5 28.5

Free cash flow 161.9 187.0 170.0 132.7 159.1 170.7 187.7 217.8 188.4 133.4 82.2

Net cash / Net debt 55.2 73.1 -25.7 -15.1 -50.4 49.7 -60.9 -167.2 -271.8 -70.3 -133.0

Shareholders‘ equity 1,118.3 1,196.8 1,089.8 1,013.4 965.6 1,060.1 951.5 769.3 647.2 549.1 462.5

Employees (FTE) 4,596 4,471 4,337 4,421 5,238 5,419 5,535 5,644 6,013 3,526 3,479

FINANCIAL DATA


KEY FIGURES

63 |

1. Return on equity: Operating EBIT / Equity

2. Return on cap. employed: Operating EBIT / (Fixed assets + Working capital)

3. Current assets ./. Cash and Cash Equivalents ./. Current liabilities

4. Current assets ./. Current liabilities / Total revenue

5. (Operating Cash flow ./. Capex) / Revenue.

IFRS unless stated different

FY 2017 FY 2016 FY 2015 FY 2014 FY 2013 FY 2012 FY 2011 FY 2010 FY 2009 FY 2008

FY 2007

Operating margin (EBITA, non-IFRS)

31.8 31.2 29.7 27.9 26.8 28.5 n.a. n.a. n.a. n.a. n.a.

EBITDA margin 30.0 29.1 29.7 26.4 26.6 28.6 28.7 28.1 30.3 28.6 25.7

EBIT margin 25.3 24.5 24.0 20.5 21.1 23.7 24.5 24.0 25.8 25.1 23.3

ROE1 19.9 17.9 19.2 17.4 21.3 23.4 28.3 34.9 33.7 32.9 31.8

ROCE2 18.0 15.2 16.1 12.6 14.6 18.2 20.5 27.4 20.9 26.2 22.5

Net Working Capital (€m)3 -€298.1 -€200.2 -€155.9 -€98.1 -€213.5 -€41.6 -€23.8 -€194.4 -€211.3 -€74.1 -€55.0

Working Capital ratio4 7.7 20.0 16.6 25.7 24.3 26.2 17.5 -8.2 0.8 3.2 4.2

Free Cash Flow margin5 18.4 21.4 19.5 15.5 16.4 16.3 17.1 19.5 22.2 18.5 13.2

Corporate tax rate 37.3 33.0 32.4 33.7 32.0 31.2 31.7 31.0 32.7 34.0 35.4

WACC6 4.95 4.05 4.13 4.35 5.12 5.1 5.7 6.8 5.5 6.8 8.4

Equity ratio 58.6 61.2 60.1 54.8 48.4 59.8 56.6 48.1 39.1 51.8 47.2

DSO (Days Sales Outstanding) 103 113 111 115 107 105 93 100 109 120 119

Capex (€m) €27.5 €16.7 €15.5 €10.5 €12.7 €13.3 €10.9 €9.7 €12.1 €6.6 €11.8

Capital Employed7 (€m) €1,248.4 €1,381.9 €1,282.8 €1,326.0 €1,346.3 €1,313.0 €1,262.0 €929.6 €1,002.2 €669.9 €655.2

KEY FINANCIAL RATIOS


IN % OF REVENUE

6. Pro forma, not applied for corporate management

7. Fixed assets + Working capital

64 |

DBP Total Revenue

Adabas & Natural

Operating Margin Group

(EBITA non-IFRS)2)

OUTLOOK


FULL YEAR 2018

1) At constant currency rates 2) Adjusted for non-operating items (see non-IFRS earnings results) 3) Weighted average shares outstanding (basic/IAS 33.19) FY 2017: 74.6m / FY 2018: 74.0m; based on new US-Federal-Tax and Euro/US-Dollar exchange rate of 1/1.18

- IoT / Cloud

- DBP excl. IoT / Cloud

EPS non-IFRS3)

FY 2018 Outlook (as of April 13, 2018)1)

30% to 32%

-6% to -2%

N/A

FY 2017 (in €m)

223.7

456.4

31.8%

14.9 +100% to +135%

+3% to +7% 441.5

+5% to +15% €2.38

65 |

KEY REVENUE METRICS FY


441.4

234.6

455.4

223.7

0

100

200

300

400

500

DBP Revenue A&N Revenue

FY 2016

FY 2017

€m

31.20% 31.80%

0%

10%

20%

30%

EBITA (non-IFRS) in % of Group Revenue

66 |

CURRENCY IMPACT ON REVENUE


Q3 2018 / YTD 2018 (9 MONTHS)

Euro 35%

US Dollar 30%

Other 14%

ILS 4%

BRL 4%

AUD 4%

GBP 6%

(in €m; yoy)

Q3

2018

Q3

in %

YTD

2018

YTD

in %

Licenses -0.8 -1% -6.0 -4%

Maintenance -1.9 -2% -16.7 -5%

SaaS 0 - -0.4 -3%

Consulting & Other -0.4 -1% -4.0 -3%

Total -3.2 -2% -27.1 -4%

Currency impact on revenue

35% revenue in Euro

65% revenue in foreign currency

Currency split YTD 2018

CAD 3%

67 |

REVENUE Q3 2018 / YTD 2018 (9 MONTHS)


(in €m) Q3

2018

Q3

2017

∆% ∆%

acc

YTD

2018

YTD

2017

∆% ∆%

acc

Product revenue 165.9 149.9 11% 13% 465.8 460.1 1% 6%

Licenses 56.7 44.5 28% 29% 144.4 136.7 6% 10%

Maintenance 104.7 103.0 2% 3% 308.8 316.9 -3% 3%

SaaS / Usage based 4.5 2.4 88% 89% 12.6 6.5 95% 101%

Services 42.7 47.2 -10% -9% 134.8 149.9 -10% -7%

Other 0.2 0.2 - - 0.5 0.6 - -

Total 208.8 197.3 6% 7% 601.2 610.6 -2% 3%

68 |

DIGITAL BUSINESS PLATFORM (INCLUDING DBP CLOUD & IoT)

SEGMENT REPORT Q3 2018 / YTD 2018 (9 MONTHS)


(in €m) Q3

2018

Q3

2017

∆% ∆%

acc

YTD

2018

YTD

2017

∆% ∆%

acc

DBP (excl. Cloud & IoT) 104.7 97.5 7% 8% 296.0 301.3 -2% 3%

- thereof Licenses 37.1 32.5 14% 15% 96.2 102.4 -6% -2%

- thereof Maintenance 67.7 64.9 4% 5% 199.8 198.9 0% 5%

DBP Cloud & IoT 9.1 3.7 144% 144% 20.7 10.2 104% 108%

Total revenue 113.8 101.2 12% 13% 316.7 311.5 2% 6%

Cost of sales -8.5 -7.8 9% 9% -26.2 -22.1 18% 22%

Gross profit 105.3 93.5 13% 14% 290.5 289.4 0% 5%

Sales & Marketing -42.9 -38.0 13% 14% -123.7 -124.7 -1% 3%

Research & Development -24.2 -22.6 8% 8% -71.1 -71.2 0% 3%

Segment result 38.2 32.9 16% 18% 95.7 93.5 2% 9%

Margin in % 33.6% 32.5% 30.2% 30.0%

Annual Recurring Revenue as of September 30

290.3 264.5 10% 11%

69 |

DBP CLOUD & IoT SEGMENT REPORT Q3 2018 / YTD 2018 (9 MONTHS)


(in €m) Q3

2018

Q3

2017

∆% ∆%

acc

YTD

2018

YTD

2017

∆% ∆%

acc

Licenses 3.6 0.7 429% 429% 5.6 2.0 177% 179%

Maintenance 1.0 0.7 53% 53% 2.6 1.7 52% 54%

SaaS / Usage based

4.5 2.4 88% 89% 12.6 6.5 95% 101%

Total revenue 9.1 3.7 144% 144% 20.7 10.2 104% 108%

Annual Recurring Revenue as of September 30

27.0 12.8 111% 111%

70 |

ADABAS & NATURAL



(in €m) Q3

2018

Q3

2017

∆% ∆%

acc

YTD

2018

YTD

2017

∆% ∆%

acc

Licenses 16.1 11.3 43% 48% 42.7 32.3 32% 38%

Maintenance 36.0 37.4 -4% 0% 106.5 116.4 -8% -2%

Product revenue 52.1 48.7 7% 11% 149.1 148.7 0% 6%

Other 0.2 0.2 - - 0.5 0.5 - -

Total revenue 52.3 48.9 7% 11% 149.6 149.2 0% 6%

Cost of sales -1.9 -2.6 -23% -22% -4.6 -7.4 -37% -33%

Gross profit 50.4 46.3 9% 13% 145.0 141.8 2% 8%

Sales & Marketing -8.7 -7.3 19% 23% -23.1 -23.4 -1% 4%

Research & Development -5.9 -5.6 5% 2% -17.4 -17.6 -1% -2%

Segment result 35.8 33.4 7% 12% 104.5 100.8 4% 11%

Margin in % 68.4% 68.3% 69.8% 67.6%

71 |

CONSULTING



(in €m) Q3

2018

Q3

2017

∆% ∆%

acc

YTD

2018

YTD

2017

∆% ∆%

acc

Total revenue 42.7 47.2 -10% -9% 134.8 150.0 -10% -7%

Cost of sales -33.3 -35.6 -6% -6% -106.8 -115.9 -8% -5%

Gross profit 9.4 11.6 -19% -17% 28.0 34.0 -18% -15%

Sales & Marketing -4.0 -4.4 -8% -7% -12.7 -14.2 -11% -8%

Segment result 5.4 7.2 -26% -24% 15.3 19.8 -22% -20%

Margin in % 12.5% 15.3% 11.4% 13.2%

72 |

RESULTS


Q3 2018 / YTD 2018 (9 MONTHS)

(in €m) Q3

2018

Q3

2017

∆% ∆%

acc

YTD

2018

YTD

2017

∆% ∆%

acc

Total revenue 208.8 197.3 6% 7% 601.2 610.6 -2% 3%

Cost of sales -45.8 -48.7 -6% -5% -143.7 -155.3 -7% -5%

Gross profit 163.0 148.6 10% 12% 457.4 455.3 0% 6%

Margin in % 78.0% 75.3% 76.1% 74.6%

Research & Development -30.2 -28.2 7% 7% -88.5 -88.8 0% 2%

Sales & Marketing -58.9 -53.6 10% 11% -169.4 -175.3 -3% 1%

Administration -19.2 -17.0 13% 14% -54.2 -55.0 -1% 1%

Other income / expense -0.2 0.6 - - 3.5 3.8 - -

EBIT 54.5 50.4 8% - 148.8 140.0 6% -

Margin in % 26.1% 25.5% 24.7% 22.9%

73 |

EARNINGS


Q3 2018 / YTD 2018 (9 MONTHS)

* Weighted average shares outstanding (basic) Q3 2018: 74.0m/ Q3 2017: 74.0m | YTD 2018: 74.0m / YTD 2017: 74.9m

(in €m) Q3

2018

Q3

2017 ∆%

YTD

2018

YTD

2017

∆%

EBIT (before all taxes) 54.5 50.4 8% 148.8 140.0 6%

Financial result 1.4 -0.3 - 3.4 -0.3 -

Profit before taxes 55.8 50.1 12% 152.2 139.7 9%

Other taxes -1.6 -1.6 0% -4.8 -5.3 -10%

Income taxes -16.1 -14.7 10% -43.5 -42.0 4%

Tax rate in % 31.7% 32.5% -31.7% 33.9%

Net income 38.1 33.8 13% 103.9 92.4 12%

EPS in €* €0.51 €0.46 13% €1.40 €1.23 14%

74 |

NON-IFRS EARNINGS


Q3 2018 / YTD 2018 (9 MONTHS)

* Weighted average shares outstanding (basic) Q3 2018: 74.0m / Q3 2017: 74.0m | YTD 2018: 74.0m / YTD 2017: 74.9m

(in €m) Q3

2018

Q3

2017 ∆%

YTD

2018

YTD

2017 ∆%

EBIT (before all taxes) 54.5 50.4 8% 148.8 140.0 6%

Amortization on acquisition related intangible assets 5.5 6.7 -19% 16.0 23.0 -31%

Share based payments 2.9 5.9 -51% 8.9 14.6 -39%

Restructuring / severances / legal case 0.6 0.4 54% 2.1 2.7 -21%

Other impacts / impacts from M&A activities 0.3 0.2 - 0.7 0.9 -

EBITA (Non-IFRS) 63.8 63.6 - 176.5 181.2 -3%

in % of revenue (Non-IFRS) 30.5% 32.2% 29.4% 29.7%

Net income (Non-IFRS) 44.7 43.1 4% 123.5 120.6 2%

EPS in € (Non-IFRS)* €0.60 €0.58 3% €1.67 €1.61 4%

75 |

* Estimated

AMORTIZATION / DEPRECIATION IMPACT


(PRELIMINARY)

Q2

2018

5.2

2.7

Q1

2018

5.3

2.7

FY

2018*

21.4

10.8

FY

2019*

21.0

11.2

FY

2020*

14.0

11.2

Q3

2018

5.5

2.7

(in €m)

Amortization

Depreciation

Q4

2018

5.4

2.7

76 |

CASH FLOW


Q3 2018 / YTD 2018 (9 MONTHS)

* Cash flow from investing activities except acquisitions and except investments in debt instruments

** yoy change because of one time property investment at Darmstadt

*** Based on weighted average shares outstanding (basic) Q3 2018: 74.0m / Q3 2017: 74.0m | YTD 2018: 74.0m / YTD 2017: 74.9m

(in €m) Q3

2018

Q3

2017 ∆%

YTD

2018

YTD

2017

∆%

Operating cash flow 38.6 37.6 3% 133.7 146.0 -8%

./. CapEx* -2.2 -2.1 -8.7 -24.7

Free cash flow 36.4 35.5 3% 125.0 121.3 3%

in % of revenue 17.4% 18.0% 20.8% 19.9%

Free cash flow per share*** €0.49 €0.48 2% €1.69 €1.62 4%

**

77 |

SEP 30,

2018

SEP 30,

2018

Assets Liabilities

BALANCE SHEET


(in €m)

DEC 31,

2017

DEC 31,

2017

365.8

279.6

55.3

1,125.9

1,907.5

Cash and cash equivalents

Financial assets

Trade and other receivables

Fixed assets

(Goodwill 968.7/ 921.4)

Total

80.9

Non-financial assets

310.6

357.8

120.8

1,118.3

1,907.5

Financial liabilities

Other liabilities

Deferred income

Shareholders’ equity

(ratio 60.2% / 58.6%)

Total

406.9

244.2 66.8

1,176.9

1,942.5

47.7

315.4

301.6

156.7

1,168.8

1,942.5

78 |

HEADCOUNT BY FUNCTIONAL AREAS* AND GEOGRAPHY


26% 1,176 (+6%)

19% 862 (+2%)

13% 623 (+3%)

42% 1,935 (+1%)

Research &Development

Sales &Marketing

Administration

Consulting &Services

26% 1,201 (+5%)

18% 823 (-4%)

13% 823 (+7%)

43% 1,997 (+2%)

Germany

India

USA

Rest of World

* According to P+L structure as of December 31, 2017

Total: 4,596 (FTE)

79 |

ALLOCATION OF CLOUD HOSTING REVENUE


NEW: WITHIN IoT/CLOUD REVENUE LINE (ADJ. FY 2017)

DBP FY 2017 (reported)

€455.3m

Consulting FY 2017 (reported)

€199.9m

Adj. DBP FY 2017

€456.4m (incl. Hosting)

Adj. Consulting FY 2017

€198.8m (excl. Hosting)

Cloud Hosting Revenue Q1 2017 Q2 2017

Q3 2017

Q4 2017

FY 2017

(€m) 0.216 0.248 0.294 0.303 1.061

80 |

IoT / CLOUD REVENUE SPLIT FOR 2017


In €m Q1 Q2 Q3 Q4 FY 2017

License 0.7 0.7 0.7 1.5 3.5

Maintenance 0.4 0.6 0.7 0.7 2.4

SaaS* 1.9 2.2 2.4 2.6 9.1

IoT / Cloud

Revenue 3.0 3.5 3.7 4.8 14.9

* Incl. Cloud Hosting Revenue


8. SHARES & OWNERSHIP

82 |

SOW, SOW:GR, SOWGn.DE

ISIN: DE000A2GS401

ADR symbol: STWRY

Indices: MDAX, TecDAX, DAX100

Number of total shares: 74,000,000

Thereof Free Float: ~ 66%

Number of shares outstanding: ~ 74m

Registered shares since Oct. 2, 2017

33.7% 61.3%

Software AGFoundation

Own Shares (0.03%)

InstitutionalInvestors

Private Investors

38.9%

23.0%

19.6%

18.4%

Germany

North America

Continental Europe (excl.Germany)

UK + Ireland

Rest of World

BlackRock, Inc 5.004% Oct. 1, 2018

Deutsche Asset Mgmt. Investment 4.91% Oct. 20, 2017

Norges Bank 3.41% Oct. 5, 2017

Axxion S.A. 3.30% Mar.13, 2018

** according to notification of voting rights above

3% threshold of shares outstanding

SHAREHOLDER STRUCTURE


Share Data Major Institutional Shareholders** Share Info

OWNERSHIP REGIONAL SPLIT*

* Institutional Investors based on

public files, November 2018

83 |

0.30* 0.33* 0.37* 0.38*

0.43* 0.46 0.46 0.46

0.50 0.55

0.60 0.65

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

DIVIDEND POLICY


FOCUS ON CONTINUITY

Dividend by fiscal year

(in € per share)

* According to the 1:3 stock split, rounded

84 |

CASH USE:


SHARE BUY-BACK Buy-back own

shares 2013 – 2014

Avg. Share Price

2013: 29,27 € | 2014: 26,72 €

Cancellation of

treasury shares

April 30, 2015

Buy-back own

shares 2015

Sept. 8 - Dec. 4, 2015

Avg. Share Price: 25,81 €

Until cancellation/cap. reduction:

Share capital: 86,943,945.00 €

Number of shares: 86,943,945

€ 225m

9.2%

€ 70m

3.4%

- 9.1%

- 3.29%

Until cancellation/cap. reduction:



Cancellation of

treasury shares

March 14, 2017

Since cancellation/cap. reduction:



Own shares

Since March 27, 2018

Buy-back own

shares 2017

March 13 - May 11, 2017

Avg. Share Price: 38,49 €

€ 89m

3.27%

0.03%

Cancellation of

treasury shares

March 27, 2018

- 3.14%

Since cancellation/cap. reduction:



85 |

CASH RETURN TO SHAREHOLDERS


Ø ¾ FREE CASH FLOW TURNS INTO DIVIDENDS AND SBB

0

50

100

150

200

250

2012 2013 2013 2014 2014 2015 2015 2016 2016 2017 2017 2018

Free Cash Flow

Share Buy-Back +Dividends

€m

86 |

SOFTWARE AG FOUNDATION


ANCHOR SHAREHOLDER

One of Germany’s ten largest foundations

(capital stock € 1bn+, Software AG shares and other assets)

Founded by Dr. h.c. Peter M. Schnell in 1992.

Disburses financial support amounting to approx. € 30 million annually

Imparts aid on principle of “self-help grant” (support of nonprofit organizations)

Focuses on many projects in different areas, including:

• science and research, environment

• support for the elderly and disabled, support for children and young people

• education and training


Code of Business

Conduct and Ethics Values such as trust, respect,

sincerity and transparency shape

our international collaboration

and business.

Promoting Employee

Engagement We foster our employees'

personal and professional

development.

Corporate University

& University Relations Helping universities and their

students excel through grants

and collaboration.

Software AG We believe that moral

principles and economic

rewards not only go together,

they belong together.

CORPORATE SOCIAL RESPONSIBILITY

Software AG

Foundation One of Germany’s largest

charities & major shareholder of

Software AG

Creating sustainable value

88 |

ANALYST COVERAGE


Baader Helvea E.R.

Barclays Capital

Berenberg Bank

Bryan, Garnier & Co

Commerzbank

Crédit Suisse

Deutsche Bank

DZ Bank

Equinet

Goldman Sachs

Hauck & Aufhäuser

HSBC

Independent Research

J.P. Morgan Cazenove

Kepler Cheuvreux

LBBW

MainFirst Bank AG

Metzler

Morgan Stanley

Oddo BHF

Société Générale

UBS I.R.

Warburg Research

For the latest consensus of analysts‘ financial estimates

please visit our IR website

Banks / Broker who cover Software AG on a regular base

https://investors.softwareag.com/en

89 |

INVESTOR RELATIONS


Uhlandstrasse 12

64297 Darmstadt

Germany

phone: +49 (0) 6151 / 92 1900

fax: +49 (0) 6151 / 9234 1900

softwareag.com

e-mail: [email protected]

mailto:[email protected]

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