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April 24, 2019, 1:37 a.m. EDT

SAP announces 2023 targets, capital markets day

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By Patrick Costello

SAP (SAP.XE) released updated midterm guidance Wednesday and said it would hold a capital markets day in November to discuss initiatives building on its recently-launched restructuring program.

The German software company said it would target a non-IFRS cloud gross margin of 75% and approx. 500 basis points of non-IFRS operating margin improvement by 2023. SAP said it will detail the path to this target during a special capital markets day held on Nov. 12.

As part of its 2023 outlook, SAP said it is aiming for an annual dividend payout ratio of 40% or more of the prior year's after-tax profit.

The company will also evaluate a multi-year repurchase program and provide an update on this during its November capital markets day, it said.

SAP's strategy will focus on tuck-in acquisitions complementary to its existing portfolio while it maintains a "strong" balance sheet, it said.

The company also said it is forming a special executive board committee to oversee its operational review. SAP said it will "significantly" increase investment in its core product areas over the next five years.

The results of its operational review and additional targets will be laid out during the November CMD, SAP said.

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