Yesterday evening Software AG pre-announced Q3 15 results above expectations thanks to unexpected licence sales in the A&N (Adabas & Natural) division, while the DBP (Digital Business Platform) division disappointed. The strong licence sales reported for A&N boosted the non-IFRS operating margin (+1.5ppt, while we expected -3ppt). FY15 company guidance has been updated, factoring less growth than initially expected on DBP, a less decline than feared on A&N, and a non-IFRS operating margin of 28-29% (vs. 27.5-28.5%). We deem the share price will react positively, but Software AG has not yet shown its ability to accelerate growth in DBP licence sales.
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