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SAP CEO braces for currency crunch

Thursday, April 17, 2014 - 02:40

Apr.17 - German business software maker SAP warned on Thursday that it expected the negative impact of volatile exchange rates to worsen in the second quarter as the strong euro weighs on its financial results. (ROUGH CUT - NO REPORTER NARRATION)

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**ROUGH CUT - NO REPORTER NARRATION** SAP said its software and software-related service revenues would take a 6 percentage point hit in the second quarter if exchange rates remained at March levels. Operating profit excluding special items would be 8 percentage points lower. That compares with a first-quarter impact of 5 percentage points on both software and software-related service revenues and operating profit. Shares in SAP were indicated to slide 3.3 percent when trading begins, according to pre-market data, while Germany's blue-chip index was seen unchanged. For the full year, SAP expects revenues to take a 4 percentage point exchange rate hit, while operating profit will be negatively impacted by 5 percentage points. At constant currencies, it still sees its full-year operating profit rising to 5.8-6.0 billion euros from 5.51 billion last year. SAP reported a 2 percent rise in first-quarter operating profit, excluding special items, to 919 million euros, fuelled by its web-based software products. That was below analysts' average expectation of 961 million euros in a Reuters poll.

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SAP CEO braces for currency crunch

Thursday, April 17, 2014 - 02:40