SAP Operating Profit Rises, CEO Bullish
German software maker SAP said Wednesday its operating profit rose 2 percent in the fourth quarter and that it has not been affected by the world economic woes.
Its business model is likely to thrive this year as it offers customers solutions to cut costs, SAP CEO Henning Kagermann told "Squawk Box Europe."
SAP's operating profit was 1.112 billion euros ($1.65 billion), while net profit fell 6 percent to 756 million euros in the fourth quarter.
The world's biggest maker of business software said it expects software and software-related services revenue to grow by 12 to14 percent this year at constant currencies -- the same guidance it exceeded in 2007 with a 17 percent increase.
"We have no indication from anybody that they will change their spending behavior," Kagermann said. "Even if there is a slowdown in the economy in the future, we deliver the right solutions for companies to prepare for such a slowdown."
Banks, which last year were the fastest-growing customer group, still make up only 4 percent of the software maker's revenue so the subprime crisis is unlikely to dent SAP's prospects, he added.
Including sales from recently acquired Business Objects and excluding acquisition-related charges of about 180 million euros, revenue should rise by 24 to 27 percent at constant currencies, SAP said.
SAP's operating profit margin should inch up to 27.5 percent to 28 percent this year excluding the charges from a comparable figure of 27.3 percent in 2007, despite accelerated investments into the company's new Web-delivered software for smaller firms.
SAP does not plan any fresh acquisitions this year to fend off U.S. rival Oracle , but if good opportunities arise, they will be considered, Kagermann said.
"We will continue this share buyback, that's one thing, another thing is we want to get rid of the debt we had through acquisition of Business Objects as soon as possible," he added.