Sage Group shares up as profit and revenues rise

Accountancy software specialist Sage Group (LON:SGE) posted a rose in first half profits on Wednesday, sending shares up over 4 percent at market open.

Net profit for the six months ending March 31 rose to £146 million, up from £106 million in the same period last year. Organic revenue rose 6.4 percent to £838 million, from £787 million the year before.

Organic operating profit also rose 5 percent, with the operating margin increasing by nearly 10 percent to 25.2 percent. The company added that it expected to exceed full-year guidance of 6 percent revenue growth and confirmed expectations of at least 27 percent operating margin on an underlying basis.

Stephen Kelly, Sage’s Chief Executive Officer, said Wednesday’s announcement showed “positive results in line with market expectations”.

He added that “there are clear signs our strategy is working, with seven of our nine largest geographies, that collectively generate 95 percent of our revenues, now delivering growth in excess of our revenue guidance.”

“Our updated payments and banking strategy and the acquisition of Fairsail, show our commitment to the golden triangle of accounting, people & payroll and payments & banking, reinforced by our cloud capabilities. We are focused on Sage continuing to invest in growth, predominantly through new customer acquisition with cloud-products, and supported by bolt-on acquisitions that accelerate the strategy,” he concluded.

Sage Group is a United Kingdom-based company providing integrated accounting, payroll and payments solutions. Shares bounced higher on the news at market open before falling slightly, to trade up 1.54 percent at 694.00 (0854GMT).