SAP Australia continues to stay red for another year again generated revenues of more than AU $ 1 billion for the year ended December 31, 2019.
For the year ended December 2019, revenue from SAP Australia was AU $ 1.19 billion, an increase of 2.4% over the previous year.
Cloud and its software provide the largest portion of the company’s total revenue, adding nearly AU $ 714 million, while its services account for AU $ 475 million.
“The company has generated growth and returned to profitability from total revenue as it continues to switch from upfront software revenue to subscription-based cloud revenue,” SAP Australia said.
The Australian SAP unit also reduced AU $ 40 million from its material costs, up from AU $ 580 million to AU $ 540 million – a 9.3% decrease year-on-year. It also paid less rent in 2019, paying only AU $ 4.8 million compared to AU $ 30 million from the previous year.
However, staff costs increased, 8.6 percentage points from AU $ 357 million to AU $ 388 million. This amount was paid to 1,255 employees.
The company’s depreciation and other costs also rose to AU $ 64.5 million and AU $ 212 million respectively, which increased 64% and 16%.
On the tax side, the company paid AU $ 642,000 in income tax.
Bundled together, SAP Australia suffered a total loss of AU $ 20.4 million, which is a slight increase from its total loss of AU $ 29 million in 2018.
Addressing the impact of COVID-19 on its operations, SAP Australia said it had a business continuity plan to respond to the outbreak, but was unable to comment on its overall impact.
“Management believes that this situation will not affect the company’s ability to provide services. Management continues to monitor the outbreak but cannot estimate its impact on the company’s performance on the date of approval of financial instruments,” SAP Australia said.
Earlier this week, SAP Australia’s parent company in Germany announced plans to notify around 9% of its 440,000 customer base security hole identified in several cloud-based products.
According to SAP, these problems were discovered after an internal review of the platform, which found that some of its cloud products did not meet one or more security standards according to law or contract.
The German software group did not elaborate on the nature of security weaknesses, because the problem had not yet received improvements in its infrastructure.
SAP proved resilient during the COVID-19 outbreak, with a slight increase in operating profit.
“Business activity in the first two months of the quarter was healthy. As the impact of the COVID-19 crisis quickly increased towards the end of the quarter, a large number of new businesses were postponed,” SAP said.
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