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INVESTOR RELATIONS FACTBOOK

February 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 technologies 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 more than 40 years in data management

and application development platforms

~ €3,3bn MARKETCAP

~ 64% Free Float

€870+ MILLION

IN REVENUE

45%+ recurring

77% product revenue

4,500+ EMPLOYEES**

R&D 26%

S&M 19%

Consulting

&Services

42%

Admin

13%

41%

Americas

51%

EMEA

REVENUE

51%

DBP

26%

A&N

23%

Services

BY REGION* BY BUSINESS LINES*

* Based on Group product revenue – FY 2017 **P&L as of December 31, 2017

4 |

BUSINESS LINES


*Group revenue split FY 2017

Share of

Revenue* 52%

Growing Revenue

• IoT and Industry 4.0 Platforms

• Integration & Automation

• Analytics & Decisions

• In-Memory Data

• Business & IT Transformation

Share of

Revenue*

Growing Stability

• Application Development

• Data Management System

• Modernization

• System Support 2050+

Share of

Revenue*

Growing Margin

• Strategy & Design

• Product Implementation &

Customized Solutions

• Education & Cloud Services

• Global Delivery (on-/offshore)

25% 23%

5 |

Revenue in €m:

EBITDA

DBP Product revenue

A&N Product revenue

PROFITABLE GROWTH


STRATEGY EXECUTION

284 224

455

2006 2017

Adabas & Natural

Extending Lifecycle

69

31.8%

24.7%

Stable core + profitable

(program 2050+)

EBITA, non-IFRS

2012

Operating margin

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. 37

Customers References & Use Cases 6. 58

Financials 7. 64

Shares & Ownership 8. 81

IoT Platform – Offering and Core Capabilities 5. 41

8 |

1. KEY INVESTMENT INDICATORS


9 |

KEY INVESTMENT INDICATORS


1. Footprint: Established global player in enterprise software

• Blue Chip customer base built over 40+ 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 by industry analysts

• Innovator: First Digital Business Platform

• Neutral vendor to integrate systems from large brands

3. Financials: Solid profit base and high cash generation

• ⅔ of license revenue from growing market segments

• 45+ percent of revenue is recurring (maintenance)

• 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 OVER 40+ 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*

41%

51%

(14%)

8%

Americas

EMEA (14% Germany)

Asia Pacific

*Based on Group product revenue – FY 2017

12 |

EXPERIENCED MANAGEMENT TEAM


AND LOYAL EXPERT STAFF

Arnd Zinnhardt Chief Financial Officer

- since 2002 -

Finance, Controlling,

Taxes, Treasury,

Business Operations,

Mergers & Acquisitions,

Investor Relations,

Global Purchasing

Dr. Stefan Sigg Chief R&D Officer

- since 2017 -

Global R&D Operations,

R&D Quality Assurance,

Research Programs,

Product Innovations

Dr. Wolfram Jost Chief Technology Officer

- since 2010 -

Product Management,

Product Marketing,

Industry Analyst Relations

Product Innovations

Eric Duffaut Chief Customer Officer

- since 2014 -

Sales, Marketing, Partner

Ecosystem, Global

Consulting Services &

Support

Karl-Heinz Streibich Chief Executive Officer

- since 2003 -

Corporate Office,

Human Resources, Legal,

Information Services (IT),

Corporate Communications,

Processes, Audits & Quality,

Environmental, Social and

Governance (ESG)

13 |
















14 |

TECHNOLOGY LEADERSHIP


SOFTWARE AG IS A LEADER IN 8 MARKETS

* The Gartner document is available upon request from Software AG.

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.

• The Forrester Wave TM: In-Memory Data Grids,

Q3 2015

• The Forrester Wave TM: Hybrid Integration For

Enterprises, Q4 2016,

• The Forrester Wave TM: Enterprise Architecture

Management, Q2 2017

• Enterprise Architecture Tools, May 2017*

Magic Quadrants

• Integrated IT Portfolio Analysis Applications,

November 2017

• The Forrester Wave TM: Digital Process

Automation, Q3 2017

• The Forrester Wave TM: Streaming Analytics,

Q3 2017

• The Forrester Wave TM: Strategic Portfolio

Management, Q3 2017

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 won’t 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 |
















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 MAINTENANCE REVENUE


0

100

200

300

400

2010 2011 2012 2013 2014 2015 2016 2017

A&N

DBP

353 362 378 369 369

407

>45% of Group revenue

from maintenance

in €m

48%

maintenance

>90% recurring

412 422

20 |

200

300

400

500

600

2015 2017 2019 2021 2023 2025

*renewal rate ca. 93-95%

400

500

600

700

800

2015 2017 2019 2021 2023 2025


A) +10% CAGR

B) flat

€m

€m

€m

MAINTENANCE REVENUE SHOWS COMPOUND GROWTH

DBP maintenance:

Renewal rate: 93% (2015-2018), 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%

FY2016

29.7%

FY2015 26.8%

FY2013

27.9%

FY2014

SOFTWARE AG


INVESTMENT KPI

44%

mainte-

nance

32%

license

24%

consulting

Growing share of product and recurring revenues

€0.50

€0.60

2014 2016

Dividend increase

Free Cash Flow

conversion rate

around 115% of

Net profit.

20%

60%

100%

140%

180% yield: 1.7%

Operating margin* expansion

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

48%

mainte-

nance

29%

license

21%

consulting

32 – 35%

(2020 target)

cash-out ratio:

25 – 33%

31.8%

FY2017


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 force & Partners

• One-time payment for perpetual license

• Additional payment for capacity upgrades, extended usage and add-on products

• Price: Capacity/MIPS or CPU based

Maintenance:

• Annual payment (renewal rate >90%)

• Price based on license volume:

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

• A&N: 15% (mainframe); 20% (other)

Consulting Services

• Implementing own products

• 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)

Application PaaS

2007 2008 2009 2010 2011 2012 2013 2016


*A&N Portfolio (all other DBP)

Internet of

Things

2017

Artificial

Intelligence

* *

Streaming

Analytics

25 |

OUR PARTNER ECOSYSTEM A FORCE MULTIPLIER FOR SUCCESS

Sample of Strategic Global Alliance Partners

Increase value:

• Increase implementation success rate by extended partner service capabilities

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

• Accelerating innovation & solutions to provide systems of differentiation

• Effective sales and service delivery due to local coverage

• Successfully manage 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

• Easily share data 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

• Meet business demands faster

• Retain business logic independent from

platform decision

ADABAS & NATURAL Application Modernization

• Improve end-user experience and

interoperability of applications

• Leverage new technologies—the Web,

mobile, SOA or big data

• Retain investments without risk

• Increase end-user productivity

• Innovate faster

ADABAS & NATURAL


TRANSACTION PROCESSING


3. MARKETS, POSITIONING & COMPETITION

28 |

DIGITIZATION WEDGE SEPARATES


DIGITAL DISRUPTION

Any industry ... Pharma Retail Manufacturing Insurance

Digital Disruption

Internet of Things

Smart Business

Connected Customers

CUSTOMERS FROM ESTABLISHED COMPANIES


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 and 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

32 |

SOFTWARE AG RANKED AS A LEADER THE FORRESTER WAVE™: STREAMING ANALYTICS, Q3 2017

Source: The Forrester Wave™: Streaming Analytics, Q3 2017, Forrester Research,

Inc., September 7, 2017

The Forrester Wave is copyrighted by Forrester Research, Inc. Forrester and Forrester Wave are trademarks of

Forrester Research, Inc. The Forrester Wave is a graphical representation of Forrester's call on a market and is

plotted using a detailed spreadsheet with exposed scores, weightings, and comments. Forrester does not

endorse any vendor, product, or service depicted in the Forrester Wave. Information is based on best available

resources. Opinions reflect judgment at the time and are subject to change.

“Software AG’s Apama continues to be a broadly

applicable and perennially capable streaming

analytics platform.”

“With its recent acquisition of Cumulocity, Apama

deeply extends its reach deeper into industrial IoT

use cases by providing device management,

digital twin, and other connectivity-oriented

services.”

“There is no stopping Apama to become the real-

time engine for digital transformation that extends

all the way from the factory floor to direct

customer interactions.”


33 |

SOFTWARE AG RANKED AS A LEADER


THE FORRESTER WAVE™: DIGITAL PROCESS AUTOMATION SOFTWARE (FORMERLY BPM PLATFORMS FOR DIGITAL BUSINESS - 2015), Q3 2017

Source: The Forrester Wave™: Digital Process Automation Software, Q3 2017,

Forrester Research, Inc., July 5, 2017






“Software AG, a longtime player in the traditional

BPM space, with its webMethods BPMS … offers

strong support for dynamic case management,

integrated RPA {Robotic Process Automation},

extensive document support, and process

modeling.”

34 |

SOFTWARE AG RANKED AS A LEADER


Source: The Forrester Wave™ Hybrid Integration For Enterprises, Q4 2016,

Forrester Research, Inc., November 18, 2016






“Software AG's DBP Integration Platform provides

typical integration capabilities, including

orchestration, transformation, messaging,

advanced routing, and wizard-based tooling. Its

platform supports multiple integration patterns,

including data integration and long-running

transactions.”

THE FORRESTER WAVE™: HYBRID INTEGRATION FOR ENTERPRISES, Q4 2016

35 |

SOFTWARE AG POSITIONED IN LEADERS QUADRANT


GARTNER’S 2017 MAGIC QUADRANT FOR ENTERPRISE ARCHITECTURE TOOLS

Figure 1. Magic Quadrant for Enterprise Architecture Tools

Source: Gartner, Inc., Magic Quadrant for Enterprise Architecture Tools, Samantha

Searle, Marc Kerremans, May 24, 2017

This graphic was published by Gartner, Inc. as part of a larger research document and should be evaluated in the

context of the entire document. The Gartner document is available upon request from Software AG.

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 designation. Gartner research

publications consist of the opinions of Gartner's research organization and should not be 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.

“The Leaders in [the] 2017 Magic Quadrant

“demonstrate clear support for delivering business-

outcome-driven EA, modeling and analysis. The

Leaders also demonstrate a clear vision of the

direction and maturation of the EA discipline, as well

as its relevance for digital business today and in the

future. The Leaders are responding to the needs of

leading EA practitioners that Gartner highlights in its

research

36 |

BLOOR RESEARCH, STREAMING ANALYTICS 2016


Software AG’s “comprehensive combination of

performance and scalability, streaming

analytics operators, graphical tools and solution

accelerators for application development” puts

it at the top of the class


4. DIGITAL BUSINESS PLATFORM – CORE CAPABILITIES

38 |

Core ERP (SOR) Legacy BI Things

PaaS SaaS

THE NEW DIGITAL IT ARCHITECTURE BIMODAL AND INTEGRATION CENTRIC

DIGITAL BUSINESS PLATFORM (PaaS Suite)

+ HYBRID

CLOUD

ON PREMISE

Systems of Differentiation (Digital Applications)

Big Data Partners Mobile Apps

Modular, Agile, Flexible, Fast, Differentiating


39 |

YOUR DIGITAL BUSINESS PLATFORM YOUR DIGITAL FUTURE WITHOUT COMPROMISE

+ HYBRID

CLOUD

ON PREMISES

ANALYTICS & DECISIONS Streaming Analytics & Artificial Intelligence In-memory Data

PROCESS & APPLICATIONS Dynamic Process Automation

Low Code Applications

INTEGRATION & API Hybrid Integration

API Management

DEVICES Device Connectivity

Device Management

BUSINESS & IT

TRANSFORMATION

Process Transformation &

Management

Governance, Risk &

Compliance

Portfolio Management

Enterprise Architecture

Management

INT

ER

NE

T O

F T

HIN

GS

powered by

ARIS & ALFABET

powered by

CUMULOCITY

powered by

WEBMETHODS

powered by

TERRACOTTA & APAMA

powered by

WEBMETHODS


40 |

DIGITAL BUSINESS PLATFORM YOUR DIGITAL CAPABILITIES

BUSINESS & IT

TRANSFORMATION

PROCESS &

APPLICATIONS

ANALYTICS &

DECISIONS

INTEGRATION &

API

DEVICES

INT

ER

NE

T O

F T

HIN

GS

Process

analytics

Business strategy

& planning

Design &

analysis

Risk & compliance

management

Portfolio

management

Enterprise

architecture

Customer

journeys

B2B & managed

file transfer

API & service

catalog

API

gateway

API

portal

Master data

management

Edge

services

Device

management

Device

agents

Device

connectivity

Application

integration Messaging

Cloud & Big Data

integration

Mainframe &

data integration

Process

automation

Case

management

Mobile

enablement

Task & work

management

Rules

management

Content

management

Dynamic

orchestration

Robotic process

automation

Low code app

development

Visual

analytics

In-Memory

store & compute

Machine

learning

Event routing

& persistence

Alerts &

actions

Distributed

caching

Predictive

analytics

Streaming

analytics

Edge

analytics



5. IOT PLATFORM – OFFERING AND CORE CAPABILITIES

42 |

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

43 |

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

44 |

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

45 |

CUMULOCITY IOT - A NEW IOT PLATFORM


COMBINING THE POWER OF CUMULOCITY WITH THE DIGITAL BUSINESS PLATFORM

46 |

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


47 |

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

48 |

SOFTWARE AG IOT PLATFORM SERVICES


Digital Business Platform Container

IoT

Analytics Device

Integration

Enterprise

& Cloud

Integration

IoT Integration

IoT Modeling &

Portfolio Mgmt

IoT Development

49 |

SOFTWARE AG MAIN ACQUISITIONS FOR IOT


EXTENDS OUR TECHNOLOGY LEADERSHIP

• 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

AI, machine learning & predictive analytics

• 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)

IoT PaaS – End-to-End Cloud Platform

50 |

51 |

5 PARTNERS – 5 PROMISES JOINT VENTURE

52 |

53 |

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


54 |

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



Device

Connectivity &

Management

Real-time

Analytics &

Visualization

Workflow

Automation …

General

Management

• ADAMOS JV, is responsible to

provide state-of-the-art software and

solutions, independent of specific

software vendors (no lock in)

• ADAMOS JV is 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 …


55 |

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 INNOVATION

& CERTIFICATION

COUNCIL

App App App

NEW

NEW


56 |

ADAMOS.COM

ADAMOS MARKETPLACES (ECO SYSTEMS)

ADAMOS

JV APP MARKET PLACE

APP INNOVATION

& CERTIFICATION

COUNCIL

App App App

ADAMOS

IoT SUITE



Device

Connectivity &

Management

Real-time

Analytics &

Visualization

Workflow

Automation …

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


57 |


6. CUSTOMER REFERENCES & USE CASES

59 |

Increase operational

efficiency

Optimize use of

assets

Better reliability

of equipment Improve product

quality

Efficiency & Optimizations

Offer higher-value

services with new

revenue models

“Assets as a service”

instead of owned

assets

Better customer

experience & new

engagements

Staying

competitive

New Business Models


SOFTWARE AG: EXAMPLE CUSTOMERS & USE CASES

60 |

FULLY TAILORED DEVICE & APPLICATION MANAGEMENT IoT PLATFORM ADOPTION

“The Deutsche Telekom ‘Cloud of Things’ [has] removed many concerns

about the perceived overheads for IoT deployment and allows our

customer’s equipment to be connected in minutes.”

- Alexander Lautz, Senior Vice President M2M, Deutsche Telekom

About Deutsche Telekom Deutsche Telekom is one of the world's leading telecommunications

companies, with 143 million mobile customers, 31 million fixed-network lines,

and over 17 million broadband lines.

Business Need Deutsche Telekom desired to expand its offering from its managed

connectivity foundations to provide a suite of capabilities to solve its

customers’ business problems, in particular those encountered through digital

transformation, limit the impact of connectivity price erosion.

Solution • Private Edition of Cumulocity IoT Platform

• Deployment in Deutsche Telekom Data Centre

• Fully rebranded Deutsche Telekom

• Dashboard, business rule and user interface customisation for solution

business

• Fault detection, automated resolution management and SLA monitoring for

operations

• Documentation, technical forum and support for developers

• Rapid low cost Proof-of-Concept (PoC) package for end customer projects

Benefits • Innovative Flexible Offering – Leveraging “ready made” software

• Additional M2M / IoT Solution Revenue – Trusted solution partner

• Local Deployment – Ensuring data security and service management


61 |

SUPPLY CHAIN AUTOMATION & AUTOMATED BILLING FOR DISTRIBUTORS (ERP INTEGRATION)

“The Cumulocity solution for our Nespresso Capsule Dispensers helped

us to reduce out-of-order and out-of-stock situations to a minimum.”

Raoul Marechal, Technics and Operations Manager, Lyreco

About Lyreco Lyreco is one of the leading global distributors of office and work supplies,

delivering 235,000 boxes every day at a 99.4% service rate from 400,000 m2 of

distribution centres using 1,750 vans and drivers.

Business Need Nespresso customers expect the highest quality from the product, the machine

and the service. Lyreco sought to ensure that every Nespresso customer would

always be served the highest quality whenever they desired, and in the most

ecological way.

Solution • Cumulocity VendMe vending machine, stock and operations management

application

• Dedicated Edition of the Cumulocity IoT Platform

• Vending machine telemetry devices and cellular connectivity

• Fully integrated to Lyreco SAP Enterprise Resource Planning (ERP) system

• Formulation and deployment of vending operations specific business rules

• Android and iPhone smartphone vending operator app

• Set up and available in 2 weeks

Benefits

• Cost-Effective Service Assurance – Avoid out-of-stock / out-of-order

• Operational Cost Savings – Fully automated supply chain

• Future Proof – Open APIs ensure easy extensions and no lock-in


62 |

ABOUT WINORA

Winora manufactures bicycles in Germany since 95 years, with

highest standards of quality, functionality and safety. Technology

and design have significantly changed.

BUSINESS NEED:

With the ongoing digitalization and need for constant innovation,

Winora wanted to provide digital connected Smart eBikes to

their customers.

SOLUTION:

Deutsche Telekom connected the Bikes to the IoT platform,

enabling Winora customers to see online view of routes/sports

activities, theft alerts with GPS monitoring as well as crash-

detection with emergency notifications to friends/relatives.

BENEFITS:

• The project is ongoing, commercial launch was in Spring

2017.

• Presentation of the system in EuroBike event resulted in

extremely positive market and consumer feedback, as well

as an increase in ordering numbers for Sduro eBikes.


63 |

SOFTWARE TRANSFORMS


“The ability to respond quickly to client requests and roll out completely new service offerings in

two months gave us a huge strategic advantage. Our team, working with Software AG’s IoT

platform, made it happen.”

— Ton de Jong | CIO, Royal Dirkzwager

From data overload to data advantage with IoT For Royal Dirkzwager and their clients, knowing where a vessel is at sea is paramount. But the

world’s oceans are large and tricky to monitor. To cope with the continuous stream of

information—and to exploit it for added functionality and reduced costs—Royal Dirkzwager

turned to Apama Analytics & Decisions and webMethods Integration, part of the Software AG

Digital Business Platform. And just like that, the liability of overload turned into a strategic

advantage by sifting through and utilizing information to help Royal Dirkzwager’s clients make

better maritime logistics decisions.

Customer Profile Royal Dirkzwager tracks nearly 2 trillion ship locations a

year for 800 maritime organizations in real time.

New Challenges • Overwhelming data volumes

• Growing demand for precision ship tracking

• Increasing customer functionality requests

Software AG Solutions Digital Business Platform:

• Real-Time Analytics powered by Apama

• Application Integration powered by webMethods

Key Benefits • Increased real-time message handling from 500 to

1,500 per second

• Extended live ship tracking from 40km off-coast to

global capture

• Enabled accurate, customer-accessible ship ETAs

• Reduced new service turnaround time

ROYAL DIRKZWAGER


7. FINANCIALS

65 |

* 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

66 |

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

67 |

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

FY 2017 (in €m)

223.7

455.4

31.8%

FY 2018 Outlook (as of January 25, 2018)

30% to 32%

-6% to -2%1)

N/A

FY 2017 (in €m)

223.7

455.4

31.8%

Current Reporting New Reporting

- IoT / Cloud N/A 14.9 +70% to +100%1)

- DBP excl. IoT / Cloud N/A +3% to +7%1) 440.5

EPS non-IFRS3) €2.38 +5% to +15% €2.38

68 |

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

69 |

Euro 34%

US Dollar 31%

Other 15%

CURRENCY IMPACT ON REVENUE


Q4 2017 / FY 2017

(in €m; yoy)

Q4

2017

Q4

in %

FY

2017

FY

in %

Licenses -7.3 -6% -7.2 -3%

Maintenance -5.2 -5% -2.2 -1%

Consulting & Other -1.2 -2% -0.6 0%

Total -13.7 -5% -10.0 -1%

Currency impact on revenue

34% revenue in Euro

66% revenue in foreign currency

Currency split FY 2017

BRL 4%

ZAR 3%

AUD 3%

GBP 6%

ILS 4%

70 |

REVENUE


Q4 2017 / FY 2017

(in €m) Q4

2017

Q4

2016

∆% ∆%

acc

FY

2017

FY

2016

∆% ∆%

acc

Product revenue 219.0 213.7 3% 8% 678.3 675.2 0% 2%

Licenses 115.3 107.5 7% 14% 256.7 263.0 -2% 0%

Maintenance 103.7 106.2 -2% 2% 421.6 412.2 2% 3%

Consulting 48.8 49.8 -2% 0% 198.8 195.2 2% 2%

Other 0.6 0.4 - - 1.9 1.4 - -

Total 268.4 263.9 2% 7% 879.0 871.8 1% 2%

Segment result 6.2 7% 20.8

71 |

DIGITAL BUSINESS PLATFORM SEGMENT REPORT Q4 2017 / FY 2017

(in €m) Q4

2017

Q4

2016

∆% ∆%

acc

FY

2017

FY

2016

∆% ∆%

acc

Licenses 77.8 78.1 0% 6% 186.9 186.3 0% 3%

Maintenance 66.9 66.3 1% 6% 268.5 255.1 5% 6%

Total revenue 144.7 144.4 0% 6% 455.4 441.4 3% 5%

Cost of sales -12.0 -9.2 30% 34% -33.3 -31.3 6% 8%

Gross profit 132.7 135.2 -2% 4% 422.1 410.1 3% 5%

Sales & Marketing -49.6 -52.1 -5% 0% -174.3 -172.4 1% 2%

Research & Development -25.7 -23.7 8% 9% -96.9 -89.9 8% 6%

Segment result 57.4 59.4 -3% 5% 150.9 147.8 2% 7%

Margin in % 39.7% 41.1% 33.1% 33.5%


72 |

ADABAS & NATURAL


SEGMENT REPORT Q4 2017 / FY 2017

(in €m) Q4

2017

Q4

2016

∆% ∆%

acc

FY

2017

FY

2016

∆% ∆%

acc

Licenses 37.6 29.4 28% 37% 69.9 76.8 -9% -6%

Maintenance 36.8 39.9 -8% -3% 153.1 157.1 -3% -3%

Product revenue 74.4 69.3 7% 14% 223.0 233.9 -5% -4%

Other 0.2 0.2 0% 5% 0.7 0.7 0% -1%

Total revenue 74.6 69.5 7% 14% 223.7 234.6 -5% -4%

Cost of sales -2.8 -3.1 -10% -7% -10.1 -11.7 -14% -12%

Gross profit 71.8 66.4 8% 15% 213.6 222.9 -4% -3%

Sales & Marketing -10.0 -13.8 -28% -24% -33.3 -38.0 -12% -11%


Segment result 55.7 46.5 20% 28% 156.5 162.4 -4% -3%

Margin in % 74.6% 66.9% 70.0% 69.2%

73 |

CONSULTING


SEGMENT REPORT Q4 2017 / FY 2017

(in €m) Q4

2017

Q4

2016

∆% ∆%

acc

FY

2017

FY

2016

∆% ∆%

acc

Total revenue 49.2 50.0 -2% 1% 199.9 195.9 2% 2%

Cost of sales -40.2 -39.0 3% 5% -156.9 -157.5 0% 0%

Gross profit 9.0 11.0 -18% -15% 43.0 38.4 12% 14%

Sales & Marketing -4.9 -4.8 2% 6% -19.1 -17.6 9% 10%

Segment result 4.1 6.2 -34% -31% 23.9 20.8 15% 17%

Margin in % 8.3% 12.4% 11.9% 10.6%

74 |

RESULTS


Q4 2017 / FY 2017

(in €m) Q4

2017

Q4

2016

∆% ∆%

acc

FY

2017

FY

2016

∆% ∆%

acc

Total revenue 268.4 263.9 2% 7% 879.0 871.8 1% 2%

Cost of sales -58.0 -54.3 7% 9% -213.4 -211.8 1% 1%

Gross profit 210.4 209.6 0% 6% 665.6 660.0 1% 2%

Margin in % 78.4% 79.4% 75.7% 75.7%


Sales & Marketing -68.1 -75.0 -9% -5% -243.5 -245.7 -1% 0%

Administration -20.9 -22.9 -9% -6% -75.9 -79.3 -4% -4%

Other income / expense -6.9 -6.7 - - -2.8 -8.6 - -

EBIT 82.7 75.1 10% - 222.8 213.9 4% -

Margin in % 30.8% 28.5% 25.3% 24.5%

75 |

EARNINGS


Q4 2017 / FY 2017

* Weighted average shares outstanding (basic) Q4 2017: 74.0m / Q4 2016: 76.2m / FY 2017: 74.6m / FY 2016: 76.2m

(in €m) Q4

2017

Q4

2016 ∆%

FY

2017

FY

2016

∆%

EBIT (before all taxes) 82.7 75.1 10% 222.8 213.9 4%

Financial result 1.9 -1.8 - 1.4 -4.4 -

Profit before taxes 84.6 73.3 15% 224.2 209.5 7%

Other taxes -1.9 -1.6 19% -7.2 -5.5 31%

Income taxes -34.5 -21.5 60% -76.4 -63.6 20%

Tax rate in % 43.0% 31.5% 37.3% 33.0%

Net income 48.2 50.2 -4% 140.6 140.4 0%

EPS in €* €0.65 €0.66 -2% €1.88 €1.84 2%

76 |

NON-IFRS EARNINGS


Q4 2017 / FY 2017

* Weighted average shares outstanding (basic) Q4 2017: 74.0m / Q4 2016: 76.2m / FY 2017: 74.6m / FY 2016: 76.2m

(in €m) Q4

2017

Q4

2016 ∆%

FY

2017

FY

2016 ∆%

EBIT (before all taxes) 82.7 75.1 10% 222.8 213.9 4%

Amortization on acquisition related intangible assets 6.6 7.3 -8% 29.6 29.1 2%

Share based payments 6.1 3.2 91% 20.7 14.2 46%

Restructuring / severances / legal case 2.0 2.9 -7% 4.7 11.8 -54%

Other impacts / impacts from M&A activities 1.0 1.7 -41% 1.7 3.0 -67%

EBITA (non-IFRS) 98.4 90.2 9% 279.5 272.0 3%

in % of revenue (Non-IFRS) 36.7% 34.2% 31.8% 31.2%

Net income (non-IFRS) 56.7 61.1 -7% 177.3 180.4 -2%

EPS in € (non-IFRS)* €0.77 €0.80 -4% €2.38 €2.37 0%

77 |

FY

2017

Amortization

(in €m)

Depreciation

* Estimated

FY

2018*

AMORTIZATION / DEPRECIATION IMPACT


(PRELIMINARY)

29.6

11.6

19.7

12.0

FY

2019*

Q1

2017

Q1

2017

7.8

2.9

Q2

2017

7.8

2.9

8.5

2.9

Q3

2017

6.7

2.8

Q1

2017

6.6

3.0

Q4

2017

17.7

12.0

78 |

CASH FLOW


Q4 2017 / FY 2017

* 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) Q4 2017: 74.0m / Q4 2016: 76.2m / FY 2017: 74.6m / FY 2016: 76.2m

**

(in €m) Q4

2017

Q4

2016 ∆%

FY

2017

FY

2016 ∆%

Operating cash flow 43.4 46.5 -7% 189.4 203.7 -7%

./. CapEx* -2.8 -4.9 -27.5 -16.7

Free cash flow 40.6 41.6 -2% 161.9 187.0 -13%

in % of revenue 15.1% 15.8% 18.4% 21.4%

Free cash flow per share*** €0.55 €0.55 0% €2.17 €2.45 -11%

79 |

365.8

Dec. 31,

2017

Dec. 31,

2017

Assets Liabilities

BALANCE SHEET


(in €m)

Dec. 31,

2016

Dec. 31,

2016

374.6

305.9

55.7

1,161.6

1,957.2

Cash and cash equivalents

Financial assets

Trade and other receivables

Fixed assets

(Goodwill 921.4 / 936.6)

Total

59.4

Non-financial assets

301.5

327.0

133.1

1,195.6

1,957.2

Financial liabilities

Other liabilities

Deferred income

Shareholders’ equity

(ratio 58.6% / 61.1%)

Total

279.6

55.3

1,125.9

1,907.5

80.9

310.6

357.8

120.8

1,118.3

1,907.5

80 |

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)


8. SHARES & OWNERSHIP

82 |

SHAREHOLDER STRUCTURE


32.7% 59.3%

Software AGFoundation

Own Shares

InstitutionalInvestors

Private Investors

1) according to notification of voting rights above 3% threshold

Number of total shares: 76,400,000

Thereof Free Float: ~ 64%

Number of shares outstanding: ~ 74m

Registered shares since Oct. 2, 2017

Share Data Major Free Float Shareholders1)

35.3%

26.2%

21.6%

16.3%

Germany

North America

Continental Europe(excl. Germany)

UK & Ireland

Rest of World

Share Info

SOW, SOW:GR, SOWGn.DE

ISIN: DE000A2GS401

ADR symbol: STWRY

Indices: TecDAX, DAX100, TechAllShare

Deutsche Asset Mgt. Investment 4.91% 20.10.2017

OWNERSHIP REGIONAL SPLIT(FREE FLOAT)

83 |

0.30* 0.33* 0.37* 0.38*

0.43* 0.46 0.46 0.46

0.50 0.55

0.60

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

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 2013-17

Buy-back own shares

2013 - 2014

Cancellation of

treasury shares

April 30, 2015

Buy-back own

shares 2015

Sept. 8, 2015 -

Dec. 4, 2015

Until cancellation / capital reduction:

Share capital: 86,943,945.00 €

Number of shares: 86,943,945

€m 225

9.2%

€m 70

3.4%

- 9.1%

-3.29%

Until cancellation / capital reduction:



Cancellation of

treasury shares

March 14, 2017

Buy-back own

shares 2017

March 13, 2017 -

May 11, 2017

3.266%

Own shares

Position after

cancellation

March 15, 2017

Since cancellation / capital reduction:



0.38%

85 |

0

50

100

150

200

250

2012 2013 2013 2014 2014 2015 2015 2016 2016 2017

Share Buy-Back +Dividends

Free Cash Flow

CASH RETURN TO SHAREHOLDERS


Ø ¾ FREE CASH FLOW TURNS INTO DIVIDENDS AND SBB

€m

86 |

SOFTWARE AG FOUNDATION


ANCHOR SHAREHOLDER

The Software AG Foundation is one of Germany’s ten largest foundations

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

Founded by Dr. hc. Peter M. Schnell in 1992

Disburses financial support amounting to approx. € 30 million annually

Principle of a “self-help grant” (supports nonprofit organizations)

The Foundation focuses on many different projects in 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 —

is the major shareholder

Creating sustainable value

88 |

ANALYST COVERAGE


Baader Helvea E.R.

Barclays Capital

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 latest consensus of analysts‘ financial estimates visit our

IR website on: www.softwareag.com

Banks / Broker who cover Software AG on a regular base

http://www.softwareag.com/corporate/inv_rel/stockinfo/estimates/default.asp

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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