Software AG: US tax reform estimated to increase group EPS (earnings per share) by +5 to +10 percent

AD HOC DISCLOSURE (INSIDE INFORMATION ACCORDING TO ARTICLE 17 MAR)

Software AG: US tax reform estimated to increase group EPS (earnings per share) by +5 to +10 percent

Germany/Darmstadt, January 18, 2018 - Software AG (Frankfurt TecDAX: SOW) herewith announces that the recently unveiled US Federal Tax reforms will have a positive impact on the future business results of the group. According to initial calculations by the company, the profit after-tax is estimated to improve during the current fiscal year 2018 and will lead to an increase in group EPS (earnings per share) of +5 to +10 percent (Assumptions: EUR/USD conversion rate 1.18; Total shares outstanding 76,400,000; revenue structure remains unchanged). This tax relief will not only impact the results of the current fiscal year, but is also expected to impact subsequent years within a similar positive range. On the other hand, for fiscal 2017, the US Federal tax reform lead to a one-time tax burden in the mid-single digit million euro range. With a total Group revenue share of more than 30 percent, the USA is by far Software AG's most important single market. Software AG has also acquired multiple US software companies and related Intellectual Property Rights for major products. This generates corresponding royalty income subject to US taxation. Consequently, Software AG also considerably benefits at a Group level from the recently announced cuts on the US-Federal profit tax rates, declining from 35 to 21 percent. Further details will be announced following the publication of the preliminary Q4 and Full Year 2017 results at a conference call for financial analysts and media representatives on 25 January 2018 at 09.30 am CET.