BackWeb could lose largest customer as SAP contract ends

Backweb Technologies's (Nasdaq: BWEB) OEM agreement with SAP has undergone a few changes since the two companies relationship began two and a half years ago. TheMarker has learned that the current agreement, responsible for 52% of BackWeb's revenues in the past year, came to an end March 15.

Apparently, BackWeb has not recognized revenue from SAP since then, although the two companies do still have ties and it is possible BackWeb will be compensated retroactively. In a conference call scheduled for Thursday, when BackWeb is slated to publish quarterly results, the company will apparently offer an update on the status of the contract ¿ whether SAP has signed a new agreement and if so, what are the terms.

SAP is BackWebss most significant customer, responsible for $10.7 million in revue in 2001. "We have strong relationships with partner like IBM, PricewaterhouseCoopers, SAP Portals, SAP, and Plumtree Consulting. We are not in a position to comment on relationships with the companies before April 18," BackWeb's spokeswoman said in an official statement. It appears BackWeb leans on a relatively small number of clients and in 2001 two other customers contributed an aggregate 11% of revenues.

CEO Eli Barkat confirmed the end of the contract with SAP and stated, "Our relationship with SAP is very strong and has expanded over the years. We are optimistic regarding a good, stable future relationship that will generate revenues. It is possible the SAP contract will not be in the same format as the past year, so there could be a hit to revenue in the short ¿term, but we believe future revenues will be even higher."