Sage Group PLC Trading Statement (1933F)
July 26 2016 - 12:00PM
UK Regulatory
TIDMSGE
RNS Number : 1933F
Sage Group PLC
26 July 2016
Trading update for the nine months ended 30 June 2016
The Sage Group plc (the Group) is today issuing its trading
update for the nine months ended 30 June 2016.
Financial performance
Group organic revenue increased by 6.0% in the third quarter,
delivering growth of 6.1% for the first nine months of the
year.
Organic recurring revenue grew by 10.1% for the year to date,
continuing the momentum established in the first half of the year,
supported by software subscription revenue which grew by 33.2% over
the same period. Organic software and software related services
(SSRS) revenue continued the trend of the first half with new
upfront licence revenues declining as the planned transition to
subscription relationships progressed. Processing revenue growth
was in line with expectations, with payroll continuing to be
stronger than payments.
Regionally, the Group's performance was driven by continued
momentum in Europe and North America, supported by an improved
performance from the International region in the third quarter.
Management remains confident of meeting FY16 full year guidance:
delivering at least 6% organic revenue growth and 27% organic
operating margin.
Steve Hare, Chief Financial Officer, commented:
"The performance for the year to date demonstrates sustained
momentum and we are encouraged by the continued double digit growth
in high quality recurring revenue.
Our business transformation remains on track and we are focussed
on its execution whilst continuing to deliver on our commitments to
shareholders, customers and the communities we serve. We take great
confidence in the resilience of our strategy and business model to
deliver sustainable and high quality growth."
Foreign exchange
Management continues to monitor the impact of the result of the
EU Referendum held in the UK in June 2016. Although conscious of
the IMF's revised growth forecasts, we do not expect there to be a
material impact on the underlying operating performance of the
business. Exchange rate fluctuations have been a feature of the
year to date. The weakening of Sterling at the end of the third
quarter relative to the currencies in most of our non-UK operating
territories will generate a slight FX tailwind for FY16 if the
current exchange rates were to prevail for the remainder of the
financial year.
Financial position
The Group's financial position remains strong and net debt as at
30 June 2016 was GBP442m (GBP404m as at 31 March 2016). The
increase in net debt during the period is predominantly due to the
movement in exchange rates between Sterling and USD/Euro at the end
of the third quarter.
Analyst and investor conference call
Management are currently hosting Sage Summit in Chicago, the
world's largest event for Entrepreneurs and Small & Medium
businesses. Steve Hare, CFO of Sage will be hosting a conference
call at 12:00 CDT / 18:00 BST today which will be webcast from a
link on our investor relations website, www.sage.com/investors. The
call may also be accessed using the dial-in number +44 (0) 20 3427
1908 and pin code: 1874015. A replay of the call will also be
available for one week after the event: Tel: +44 (0) 20 3427 0598,
pin code: 1874015#
Enquiries
The Sage Group plc +44(0) 191 294 3000
Steve Hare, Chief Financial Officer
Simon John, VP Investor Relations
Tulchan Communications +44(0) 20 7353 4200
David Shriver
Jonathan Sibun
About Sage
Sage is the market leader for integrated accounting, payroll and
payment systems, supporting the ambition of the world's
entrepreneurs. Sage began as a small business in the UK 30 years
ago and over 13,000 colleagues now support millions of
entrepreneurs across 23 countries as they power the global economy.
We reinvent and simplify business accounting through brilliant
technology, working with a thriving community of entrepreneurs,
business owners, tradespeople, accountants, partners and
developers. And as a FTSE 100 business, we are active in supporting
our local communities and invest in making a real difference
through the philanthropy of the Sage Foundation.
For more information, visit www.sage.com
ENDS
This information is provided by RNS
The company news service from the London Stock Exchange
END
TSTUNAORNOABURR
(END) Dow Jones Newswires
July 26, 2016 12:00 ET (16:00 GMT)
Sage (LSE:SGE)
Historical Stock Chart
From Mar 2024 to Apr 2024
Sage (LSE:SGE)
Historical Stock Chart
From Apr 2023 to Apr 2024