Sage profits grow 11% in 2011

Sage reported an 11% increase in pre-tax profits to £330.8m on a turnover of £1.3bn for the year to 30 September, but warned of future uncertainty among its small and medium-sized clients.

While the headline profit figure reached double figures - an important psychological target for Sage and its investors - the FTSE100-listed accounting software giant achieved 4% organic growth both worldwide, and in its UK and Ireland business. Profitability was maintained by internal focus and investments in boosting profit margins, and favourable tax settlements also helped.

Chief executive Guy Berruyer attributed Sage’s successful period to a new management structure, the sale of the loss making US Sage Healthcare division and enhancements to its product portfolio.

In the UK, Berruyer commented, “We saw several significant launches in the year including Sage 50 Mobile, and Sage One which has now passed 1,000 paying customers. Sage ERP X3 grew rapidly in the UK off a small base. Our Accountants’ Division has continued to perform well with good demand for a new tiered offering as well as our iXBRL compliant product.”

The results showed “concrete progress” after his first year at the helm, but Berruyer admitted he was “concerned” for next year.

“As we look forward, there are clearly significant macro-economic concerns which may impact SMEs, particularly in the eurozone, and our customers are telling us through our Sage Business Index that they see the outlook remaining uncertain,” he said.

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