Sage’s business cloud boosts its half-year results

sage has presented the results corresponding to the first semester of its fiscal year 2022which show that its recurring revenues increased during said period by 8% to 1,010 million euros, a figure driven by the growth of its cloud revenues, Sage Business Cloudwhich improved its income by 21%, to 666.5 million euros, in the period.

Additionally, its annual recurring revenue is up 10%, thanks to increased recurring revenue from its cloud-native solutions. As for the company’s total organic revenue, it improved by 5% to 1,076.66 million euros. As for its operating profits, they have improved by 4%, to 214.4 million euros. Likewise, non-recurring net income was 64.1 million euros, compared to 43.11 million euros in the same period of the previous year.

The company’s interim dividend has risen by 4%, and it has close to 1,400 million euros of cash and financial liquidity, as well as a net debt over Ebitda of 1.5x. Annual recurring revenue from Sage’s cloud-native products is up 43% year-on-year, driven by new customers and migrations of cloud-connected products. The value renewal rate has reached 100% and Sage Business Cloud penetration is now 72%, up from 65% a year ago.

The company has delivered strong results across its core cloud-native solutions, including Sage Intacct, Sage Accounting, and Sage People, as well as steady growth across the Sage 50 and Sage 200 franchises. It has also accelerated its growth strategy with the purchase of Brightpearl. , a cloud-native retail operations management system. It has also ceased its business area in Switzerland and the payroll outsourcing area in South Africa, in order to be able to focus more on its main regions, as well as to end the group’s divestiture programme.

As for Sage’s forecasts for the current fiscal year, they remain stable. The company expects to see an organic increase in recurring revenue of between 8% and 9% in 2022, thanks to the strength of Sage Business Cloud, and especially, revenue from cloud-native apps and tools. At the same time, at Sage they foresee that other income, in line with the strategy they have implemented, will continue to decline. As for its organic operating margin, the company expects it to increase in 2022, thanks to Sage’s efforts to expand the group.

The Sage CEO Steve Harehas highlighted that the company has reached «a strong first half result, in line with expectations, showing further momentum and sustainable growth. Our strategic investment in sales, marketing and innovation has continued to drive revenue growth in the Sage Business Cloud, supported by increased levels of new customer acquisition. Cloud-native solutions, now accounting for around a quarter of the Group’s ARR, have shown particularly good performance«.

Hare has also underlined that although in Sage they are «aware of the growing macroeconomic and geopolitical uncertainty, our clients continue to trust and resist. Our goal is to break down the barriers to success by offering solutions that make your life easier, and we continue to make good progress on our strategic goals. I am confident that our ambition to become the trusted network for small and medium-sized businesses will drive Sage’s success as we focus on absolute revenue and profit growth.«.

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