update software AG: release of preliminary earnings for the 2009 financial year

Vienna, Frankfurt, 28 January 2009 +++ update software AG, a leading provider of CRM solutions listed on the Frankfurt Exchange, has released its preliminary results for the 2009 financial year. As a consequence of the difficult economic environment, the Company suffered a decline in revenue of 14.5% to EUR 31.346 million, and its EBIT was also down from last year.

Revenue decline in Q4
In the quarter just ended, update Software AG reported revenue of EUR 7.974 million, down 21.1% year-on-year (Q4 2008: EUR 10.107 million). EBIT before non-recurring items (consisting of restructuring costs, provisions for impending losses and write-downs on holdings in the amount of 3.172 million) in Q4 was EUR 1.396 million, up 10,4% year-on-year (Q4 2008: EUR 1.264 million). EBIT after non-recurring items was EUR -1.777 million.

Accumulated revenue for the entire 2009 financial year totaled EUR 31.346 million, which corresponds to a decline of 14.5% (2008: EUR 36.644 million). Broken down by segments, revenue changed as follows: licensing and maintenance 16.9%, services 10.4%. Customer restraint in capital spending also had a marked impact on the Company’s earnings: as a result, update software AG reports preliminary EBIT before non-recurring items of EUR 1.201 million, which corresponds to a decline of 70,1% compared to one year earlier (2008: EUR 4.013 million). EBIT post non-recurring items was EUR -1,971 million. Net earnings will be released once the annual statements have been approved by the Company‘s Supervisory Board.

Cash on hand as of the balance sheet closing date was EUR 10.323 million, i.e. down 14,4% year-on-year (2008 closing date: EUR 12.064 million).

Commentary text:
“Thanks to our implementation of structural changes, and despite the continued difficult economic climate, update was able to post profits again in the second half of 2009, following a weak first half. However, non-recurring items in Q4 had a significant impact on our net earnings. The new business model that we have developed, which will provide update with unique value propositions superior to those of our competition, is our response to the challenges of the market as we start into the new decade”, says the Board of Management in commenting the results. Due to the transition to SaaS (Software as a Service), the Company expects its consolidated revenue for the 2010 financial year to remain unchanged, with operating income of EUR 0.

New customers who opted for update’s solutions in the quarter just ended include VITA 34 AG, nkt cables GmbH, and Dr. Loges + Co GmbH in Germany, the French GROUPE POINT P (Saint-Gobain Distribution), BAM Materieel B.V. in the Netherlands, and Swisspor AG headquartered in Switzerland.

Investor Relations Contact:
update software AG
Operngasse 17-21
1040 Vienna, Austria
Phone: +43 1 878 55 512
Fax: +43 1 878 55 9512
investor.relations@update.com