Sage struggles in subdued market
Company remains upbeat despite rising debt
Software specialist for small and medium businesses Sage said the weak pound had helped offset a subdued market for its products.
For the three months ended 31 December 2008 trading was in line with expectations.
Sage chief executive Paul Walker said: “We are pleased to report that, despite volatile conditions in many of our markets, overall trading remained in line with our expectations. Subscription revenues continue to show good growth, offsetting the anticipated contraction in software and software-related services."
Although the weak pound helped sales it did not help debt, which grew. Net debt was £649m on 31 December 2008 compared to £541m on 30 September 2008. But Sage remains within its banking covenants and has financing in place until 2011.
Analysts were predicting sales of £1.4bn and Ebitda (profits before bad stuff) of £320m for the year to 30 September 2009.
The markets were not too impressed though. Sage shares fell by more than three per cent this morning.
The company employs 14,500 people. ®