SAP AG shares were buoyant yesterday morning as the Walldorf software giant reported better than expected figures. But chairman Dieter Hopp warned that the success could not continue at such a rate, despite a very strong start to the year. Net profits for the group soared 93% to the equivalent of $204.9m in 1994, as turnover rose 66% to $1,335.3m. Hopp cited the strength of the mark against the dollar as one of the reasons why he felt that the growth rate could not be maintained. This did not prevent a buying spree, fuelled in part by speculation that the shares will be added to the elite DAX-30 index in the autumn. This stock is unbelievable. It’s hard to predict a top, a Frankfurt trader told Reuters. The jump in revenues was largely due to the R/3 clien t-server system, where sales rose 218% to $711m, and customers rose to 1,500. The company said that sales were up 72% in first quarter trading, outstripping any rise in costs and the strong mark, which on its own resulted in considerable losses. It further warned that its 1995 profits would be reduced by DM30m if currency levels remained unchanged from their current positions. The board is seeking permission for a 10-for-one stock split, reducing the shares’ nominal value to five marks – pre-split, the shares are trading at 1,479 marks. Hopp said the company would be placing American Depositary Receipts with institutions in New York, but would not be seeking an exchange listing. The preference shares belonging to Hopp and the other three founders will be used as the basis for the placing in New York.
