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SAP lays off unspecified numbers

Views 1 Views    Comments 0 Comments    Share Share    Posted 18-03-2009  
NEW DELHI: The German software giant SAP AG reportedly laid off an unspecified number of employees recently as part of its previously announced
plan to trim 3,000 jobs.

The lay offs were confirmed by a company spokesman according to the report. The spokesman said that the cuts were not directed at any one particular discipline or area of our business and were spread across the board.

SAP, which implemented cost savings in October after sales dropped sharply, said it would continue to slash costs and announced that it intended to reduce its workforce to 48,500 by the end of this year from 51,800 now.

The world`s biggest maker of business management software gave no target for its key software and software-related sales this year but based its margin forecasts on the assumption that core sales would be flat or 1 percent lower than 2008 sales of 8.62 billion euros.

Co-chief executive Leo Apotheker told Bloomberg television in January that SAP was still seeing demand for software despite the global economic slump and that it intended to avoid forced layoffs. However, seems that approach is not working.

SAP said it expects the staff reductions to result in 300 million to 350 million euros in annual cost savings beginning in 2010 but also in restructuring charges this year in a range of 200-300 million euros.

That would weigh on its 2009 operating margin by 2 percentage points to 3 percentage points, the company said. It forecast an operating margin of 24.5 percent to 25.5 percent versus 28.2 percent last year.

SAP said 2008 operating profit rose 4 percent to 2.84 billion euros ($3.75 billion) and total software and software-related sales gained 14 percent to 8.46 billion euros.

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