SNP Schneider (DE:SHFG) preliminary H118 results indicate that the strongly anticipated tsunami of SAP S/4HANA transformations has continued to shift out as enterprises await greater clarity on the technological transition to the new cloud platform. After the Q1 results in May we reported that there had been several S/4HANA project delays, as such transformations are highly complex to implement. We understand this trend has continued. Nevertheless, SNP remains extremely confident that the tsunami is just a matter of time. In preparation, SNP has established new partnership with IBM Services incorporating a novel ‘Bluefield’ approach to target the potentially substantial S/4HANA market. We have removed our forecasts and will review them after the full Q2/H1 results on Thursday.
Trading update: Delays in project completions
H1 revenue was c €65m, representing c 35% growth over H117 while there was an adjusted loss before interest and tax (LBIT) of c €3.6m and a statutory LBIT of c €6.0m. The performance was primarily affected by delays in project completions, resulting in temporarily lower capacity utilization for Professional Services, particularly software licence revenue from SNP’s in-house products fell short of expectations. Management now expects FY18 group revenue to be €135–140m (previous guidance was €150–155m) with a slightly negative EBIT margin. This suggests the H2 EBIT margin will be in positive single digits.
To read the entire report Please click on the pdf File Below: