Software giant Sage acquires UK cashflow firm as revenues rise
Software company Sage has reported a rise in recurring revenue thanks to sales of its cloud suite of products, and announced the purchase of UK-based Futrli.
The North Tyneside-based FTSE 100 firm said organic recurring revenue grew 8% to £866m, from £800m, in the six months to the end of March this year.
Underlying revenue growth was most significant across North America with a 10% rise to £377m, while its northern Europe business grew 7% to £212m, and its international revenue fell by 9% to £346m.
Sage said its organic operating profit beat expectations, rising 4% to £184m, while its underlying operating profit fell from £188m to £183m during the period due to £18m of amortisation associated with acquisitions, £15m of merger and acquisition related charges and a £1m deferred income adjustment from its purchase of Brightpearl.
In November last year, Sage completed the disposal of its Swiss business and in April, it disposed of its South African payroll outsourcing business. The move was said to allow resources to be focused on fewer, larger geographies.
Meanwhile, Sage completed the acquisition of UK cashflow forecasting tool Futrli which uses algorithms to provides forecasts based on data-analysed historical trends, using invoices, bills, journals, cash, and payment data – enabling customers to visualise the past, present, and future of their business.
Neal Watkins, EVP Product at Sage, said: "Futrli will form an important role in the way we support accountants and their clients to gain the visibility needed to deliver great advisory services - all as part of our Sage for Accountants solution."
In announcement to shareholders about Sage results, CEO Steve Hare said: "We achieved a strong first half performance, in line with expectations, demonstrating sustainable growth and building further momentum. Our strategic investment in sales, marketing and innovation has continued to accelerate revenues across Sage Business Cloud, underpinned by increasing levels of new customer acquisition. Cloud native solutions, which now account for around a quarter of Group ARR, have performed particularly well.
"While we are mindful of increased macroeconomic and geopolitical uncertainties, our customers remain confident and resilient. Our aim is to knock down barriers to their success, delivering solutions that make their lives easier, and we continue to make good progress against our strategic objectives.
"I am confident that our ambition to become the trusted network for small and mid-sized businesses will drive the success of Sage, as we focus on growing both revenue and earnings in absolute terms."