SAP’s primary source of cash is our strong operating cash flow. Over the past several years, the principal use of cash focused on:
- Capital expenditure to support our growth
- Quick repayment of financial debt
- Acquisitions and venture activities
- Payment of attractive dividends
- Share buy-backs to return excess cash to shareholders
Prime principle of our financial risk management is to safeguard liquidity at a level to be able to meet all our financial obligations – including your investment – at all times.
Minimum Operating Group Liquidity
Ensured by stable cash flows driven by recurring revenue streams
Revolving Credit Facility
Serves as a back-up credit facility with a relationship-defining character for our 20 participating banks
M&A Driven External Debt Financing
Optimal positioning of SAP in the current industry transformation, especially towards cloud business
The primary objective of our financial risk management is to maintain liquidity in the Group at a level that is adequate to meet our obligations. Most SAP companies have their liquidity managed by the Group, so that liquid assets across the Group can be consolidated, monitored, and invested in accordance with Group policy. High levels of liquid assets help keep SAP flexible, sound, and independent. In addition, various credit facilities are currently available for additional liquidity, if required.
We manage credit, liquidity, interest rate, equity price, and foreign exchange rate risks on a Group-wide basis. We use selected derivatives exclusively for this purpose and not for speculation.
Our balance sheet structure is conservative – with a high equity ratio, modest financial leverage, well-balanced maturity profile, and sufficient debt capacity.