Sage sales, profits up
Sage, the UK's most successful software firm, has hit the numbers with full year profits up six per cent to £89.1m on revenue up 14 per cent to £557m.
This was not quite good enough for the market, which was expecting something a little more sparkling. Shares fell 9 per cent in morning trading. There is a big question mark over Sage's accounting policies, so far as many analysts are concerned. Sage has bought many software firms in recent years and retains the full book value of the acquisition on its balance sheet. The usual practice is to write off the value of an acquisition to zero over several years.
Sage robustly defends its practice, arguing that it has enhanced the value of the businesses it has bought, so has no need to amortise the goodwill. ®
Newcastle, England, Dec. 3 (Bloomberg) -- Sage Group Plc, the U.K.'s biggest maker of accounting software, said fiscal full-year profit rose 6 percent, boosted by sales to existing customers.
Net income for the year ended Sept. 30 was 89.1 million pounds ($139 million), or 6.99 pence a share, compared with 83.7 million pounds, or 6.59p a share, in the year-ago period, Sage said in a PR Newswire statement. Revenue rose 14 percent to 551.7 million pounds.
Sage, whose software competes with products from Intuit Inc., benefited as its 3 million small- and medium-sized business customers purchased upgrades of its software even as slowing economies prompted companies to cut expenses.
Shares of Sage, whose products also include the ACT! sales management software, yesterday rose 6.25 pence, or 4 percent, to 163p. They have declined 29 percent this year.