After Record 2006, SAS Is 'Locked and Loaded' for 2007

CARY, N.C. — SAS set a company record for revenues in 2006, but the privately held software giant is looking for even stronger growth and planning to hire hundreds of people in 2007.

After pushing through a reorganization last summer and launching its first-ever channel-partner program to put more feet on the ground for sales, SAS said Tuesday that its 2006 revenues hit $1.9 billion. That’s an increase of 12 percent over 2005’s total of $1.7 billion. In 2005, SAS grew revenues 10 percent.

But 2007 is shaping up to be an even better year, said Jim Davis, SAS’ chief marketing officer, and the company is planning to boost headcount by 3 percent to 5 percent. That means hundreds of new jobs, most of which will be in sales.

“Things do look good going into 2007,” Davis said. “We took care of the realignment that was necessary and we hired more sales people. Two things are going in our favor right now. We are in one of the hottest markets right now, and from an internal perspective we don’t anticipate having to deal with anything in 2007 like we did in 2006.

“We’re pretty much locked and loaded going into 2007,” Davis said.

In addition to new hires, SAS will announce in the near future another channel for sales efforts. SAS is finalizing details for a program to work with systems integrators to augment the program it launched last year to work with information technology services providers.

“It was a good year,” Davis told WRAL Local Tech Wire, referring to 2006. “Everyone was asking questions last summer about what’s going on at SAS. We said at the time, the reorganization made sense going forward, and I can promise you we made progress.

“We ended up the year with more employees than we started – about 3 percent,” he added. “And we increased our revenues 12 percent, or around $200 million.”

The realignment of some 200 positions enabled SAS to put more people into sales, where help was needed, Davis said. The company is looking to further expand its internal sales force.

In another move to increase revenues, SAS also plans to sell more services, with systems integrators playing a major role.

“Only 10 percent of our revenues come from services right now,” Davis said.

Services will be offered to support clients after they have purchased or upgraded SAS products. The systems integrators can help boost service revenues since “they are already in those companies,” Davis said.

If the services business grows as expect, Davis said, SAS could end up having to boost its own services group. “Our partners might need to backfill with SAS people,” he explained.

Davis is excited about the launch of the systems-integrator program as well for what it could mean to new product sales.

“If you think about it, in the past at SAS there has been one pipe, one channel, for sales – the employee base,” he said. “Going forward, we will have three pipes – the channel partners, the systems integrators and the direct channel. And this will have no impact on the direct channel. We plan to hire as many sales people as we can find.”

SAS, which is now 30 years old, increased revenues in several different market segments, including new software license revenue, which jumped almost 20 percent. In a statement, SAS said it had expected a much lower growth rate.

SAS products sold especially well in retail applications, such as for price optimization solutions, Davis said. Other big sellers remained industry-specific applications such as fraud detection. Overall, financial services produce 40 percent of SAS’ revenue.

“This year’s strong financial results validate the new course we set for the company several years ago when we began investing heavily in business- and industry-focused applications built on an enterprise intelligence platform,” SAS Chief Executive Officer and co-founder Jim Goodnight said in a statement. “We had a good year. Industry and packaged business solutions were up 49 percent over 2005. One of our core strengths, powerful predictive analytics, continued to represent a significant stream of revenue at 19 percent growth. Sales of business intelligence and data integration/warehousing were each up by nearly 50 percent, demonstrating the importance of an integrated intelligence portfolio.”

SAS added more than 1,300 customers in 2006, but revenues from existing customers accounted for 70 percent of sales.

Sales were evenly divided between the Americas and Europe-Middle East-Africa, with each accounting for 45 percent of revenues. Asia made up the remaining 10 percent.