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TMCNet:  SAS revenue rises 5.4 percent [The News & Observer (Raleigh, N.C.)]

[January 24, 2013]

SAS revenue rises 5.4 percent [The News & Observer (Raleigh, N.C.)]

(News & Observer (Raleigh, NC) Via Acquire Media NewsEdge) Jan. 24--Business software giant SAS generated $2.87 billion in revenue last year, a 5.4 percent increase that extended the Cary company's unbroken streak of revenue growth.

SAS is anticipating that 2013 will be even better as it gains traction with a new technology platform that enables faster data analysis for its customers. The server platform, which SAS calls High-Performance Analytics Server, is expected to boost sales this year as the company upgrades its software to take advantage of the better performance, said Jim Davis, senior vice president and chief marketing officer."I'm not disappointed at all in the 5.4 percent growth," Davis said. "But at the same time, with the new technology ... we are going in fully loaded into 2013." Davis called the new High-Performance technology one of SAS's few "defining moments" in its 37-year history. Last year the company reinvested 25 percent of its revenue -- more than $700 million -- in research and development.

Corporations, government agencies and others use SAS business intelligence and analytics software to analyze their operations and predict trends. Forrester Research recently called SAS "an analytics powerhouse." The privately held company said that categories that generated double-digit sales last year included customer intelligence, fraud detection, risk management and supply chain management.

Total revenue came in at the lower end of the forecast Davis provided in October.

By geography, SAS revenue grew by 7.2 percent in the Americas and 9.5 percent in Asia Pacific in 2012. Overall results were hurt by a mere 2.2 percent rise in EMEA -- Europe, the Middle East and Africa.

EMEA sales suffered from the continent's economic woes and a weak euro. After adjusting for currency fluctuations, EMEA sales rose 6.9 percent, Davis said.

"On the flip side, we are entering 2013 with the euro in a good position," he added. "If it can hang on this year, we're going to get the opposite effect." Davis also said sales to the federal government suffered in the fourth quarter of 2012 because of concerns that the country might careen over the so-called fiscal cliff, the automatic federal spending cuts and tax increases that were scheduled to take place at the beginning of the year.

U.S. sales accounted for 37 percent of total revenue in 2012 and the Americas overall accounted for 47 percent. EMEA sales contributed 41 percent and Asia Pacific accounted for 12 percent.

SAS's reliance on annual subscription fees from customer makes it harder to increase revenue compared to competitors that tend to charge a large upfront fee plus much smaller maintenance fees in subsequent years.

SAS also breaks out what it calls "new sales" -- sales to brand-new customers and sales to existing customer that expand their use of SAS software. Last year new sales rose 25 percent in Asia Pacific, 8 percent in Europe and just over 3 percent in the U.S., Davis said.

"I pay a lot of attention to the new sales growth rates," he said. "To me, that's a reflection of what we are selling today and is it ringing true with our partners and customers." SAS, which was founded in 1976, is one of the Triangle's largest employers with 4,925 workers at its sprawling Cary campus.

Last year the company increased its workforce by 7 percent, boosting its worldwide employment at the end of the year to 13,442 workers.

Employment in Cary rose 5 percent last year. The company is currently constructing a new building on its Cary campus, scheduled to open in 2014, that will house 690 offices.

SAS doesn't disclose its profit, but says it has been profitable every year since it was founded. In addition, its revenue has grown every year.

"To the best of my knowledge, there is no other software company out there that can claim that," Davis said.

Ranii: 919-829-4877 ___ (c)2013 The News & Observer (Raleigh, N.C.) Visit The News & Observer (Raleigh, N.C.) at Distributed by MCT Information Services

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