The Channel logo

News

By | Joe Fay 3rd December 2008 16:20

Sage turns in solid '08, cautious on future

Waits for acquisition targets to get sensible on prices

Sage had to restrain itself from sounding too optimistic today as it announced full year results that showed revenues and profits up on the year.

The Newcastle-based accounting software vendor said it had produced solid results in a "difficult" market, and while remaining cautious, ventured that it would "weather these turbulent times".

Consolidated revenues for the year ending September 30 came in at £1.3bn, up seven per cent on the year, or 11.9 per cent. When adjusted for foreign currency changes, revenues were up seven per cent. Consolidated pre-tax profit was £241m, compared to last year's £223.3m. Adjusted pre-tax profit was up three per cent to £273.3m.

CEO Paul Walker played up the "strength and flexibility of its business model" when he said had "helped us achieve solid results in difficult market conditions". Unsurprisingly it saw markets weaken in the UK and North America, while Europe and the rest of the world recorded strong results. The firm saw a shift towards subscription revenues in the UK and North America, which offset the challenges in the traditional software market.

The firm has been on an acquisition drive for as long as anyone can remember, but said the last 12 months had been quiet on this front. It said it continued to evaluate a number of buys, but noted that "in many cases, vendor price acquisitions have not as yet adjusted to current market conditions." As the economy dissolves before our eyes, this may change soon, and the firm said its strong balance sheet and cash conversion put it at an advantage when it came to moving in and sweeping up the mess.

Compared to recent statements from large chunks of the business world, Sage's outlook statement was practically giddy.

It said it anticipated the economic climate "will remain uncertain for the near future".

But it added: "Our business model, together with consistently strong cash flows, robust balance sheet and high level of recurring revenue streams, provides a solid foundation for our operations."

In the first months of its new financial year, it said, "growth in subscription revenues had continued to offset weakness in software revenues.

"Although we remain cautious in our outlook, we expect demand for our customer support to continue, which combined with tight cost control and our strong geographic market positions, will allow us to weather these turbulent times." ®

comment icon Read 1 comment on this article alert Send corrections

Opinion

Chris Mellor

How long before Blue Big HQ pulls the plug on the whole thing?

Chris Mellor

Drives nails forged with Red Hat iron into VCE's coffin
Sleep Cycle iOS app screenshot

Trevor Pott

Forget big-spending globo biz: it's about the consumer... and he's desperate for a nap

Features

Windows 8.1 Update  Storeapps Taskbar
Chinese Buffet self-service
Chopping down the phone tree to scrump low-hanging fruit
An original member of the System/360 family announced in 1964, the Model 50 was the most powerful unit in the medium price range.
Big Blue's big $5bn bet adjusted, modified, reduced, back for more
Microsoft CEO Satya Nadella
Redmond needs to discover the mathematics of trust