As mentioned above; there is no problem reported while registering the virtual SLES12 SP2 server; however those appears as physical rather than virtual. At the same time; if I register other system configured with SLES11SP4; it displays correctly.
All these virtual hosts are installed on IBM Power E870 Frame.
Let me know if you need any more information on this to advice.
I have reviewed article available on https://www.suse.com/support/kb/doc/?id=7017181 and can confirm that SUSEConnect version is higher than the recommended.