REG - Sage Group PLC (The) - Trading update for the 3 months ended 31 Dec 2024

SageAnnouncement

30/01/2025 07:00

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RNS Number : 1901V  Sage Group PLC (The)  30 January 2025

 

 

The Sage Group plc

Trading update for the three months ended 31 December 2024

 

The Sage Group plc (FTSE: SGE), a leader in accounting, financial, HR and
payroll technology for small and mid-sized businesses, today issues a trading
update for the three months ended 31 December 2024 1  (#_edn1) .

Jonathan Howell, Chief Financial Officer, commented:

"Sage has made a strong start to the year, achieving broad-based revenue
growth in line with expectations, despite the ongoing macroeconomic
uncertainty. We're innovating across our platform to deliver productivity and
insights to small and mid-sized businesses, transforming their workflows
through our products and AI-powered solutions. We reiterate our guidance for
the full year, as set out in our FY24 results announcement, as we continue to
focus on efficiently scaling the Group."

 Underlying Revenue Performance 2  (#_edn2)  Q1 25   Q1 24   % Growth  Organic

% Growth

 Total Revenue                               £612m   £558m   +10%      +9%
      of which Sage Business Cloud           £502m   £443m   +13%      +13%

 Total Revenue by Region
 North America                               £279m   £250m   +11%      +11%
 UKIA                                        £176m   £162m   +9%       +9%
 Europe                                      £157m   £146m   +8%       +7%

Total revenue increased by 10% to £612m in the first quarter, with all
regions contributing to growth.

In North America, revenue increased by 11% to £279m, with a good performance
from Sage Intacct together with continued growth in Sage 50 and Sage 200. In
the UKIA region, revenue grew by 9% to £176m, driven by Sage Intacct together
with cloud solutions for small businesses (including Sage Accounting and Sage
Payroll), alongside further growth in Sage 50 and Sage 200. In Europe, revenue
increased by 8% to £157m, with a strong performance across our accounting, HR
and payroll solutions.

Sage Business Cloud revenue increased by 13% to £502m, driven by balanced
growth from both new and existing customers, including cloud native revenue
growth of 22% to £208m (Q1 24: £170m).

Recurring revenue grew by 10% to £595m (Q1 24: £540m), reflecting continued
momentum in Annualised Recurring Revenue (ARR) during the quarter. Software
subscription revenue grew by 12% to £509m (Q1 24: £455m) resulting in
subscription penetration of 83% (Q1 24: 82%).

On an organic basis (excluding the impact of M&A), total revenue increased
by 9% to £611m (Q1 24: £560m), while recurring revenue increased by 10% to
£594m (Q1 24: £542m).

Foreign exchange

Sterling strengthened against the US dollar and other international currencies
compared with the prior period, leading to an exchange rate headwind.

Analyst and investor conference call

Jonathan Howell will host a webcast and conference call today at 8.30am UK
time. The webcast can be accessed via the following link:
https://edge.media-server.com/mmc/p/uf66bh7b
(https://edge.media-server.com/mmc/p/uf66bh7b) . To join the conference call,
please register via:
https://register.vevent.com/register/BI0186d0df8833490eb389b3f1c06f9fe4
(https://register.vevent.com/register/BI0186d0df8833490eb389b3f1c06f9fe4) .

Enquiries

Sage +44 (0) 77721 599502

Jonathan Howell, Chief Financial Officer

James Sandford, Investor Relations

David Ginivan, Corporate PR

FGS Global +44 (0) 20 7251 3801

Conor McClafferty

Sophia Johnston

About Sage

Sage exists to knock down barriers so everyone can thrive, starting with the
millions of small and mid-sized businesses (SMBs) served by us, our partners
and accountants. Customers trust our finance, HR and payroll software to make
work and money flow. By digitising business processes and relationships with
customers, suppliers, employees, banks and governments, our digital network
connects SMBs, removing friction and delivering insights. Knocking down
barriers also means we use our time, technology and experience to tackle
digital inequality, economic inequality and the climate crisis.

 1  (#_ednref1) All figures are on an underlying basis unless otherwise
stated.

 2  (#_ednref2) Underlying and organic results are presented on a constant
currency basis, while organic growth also excludes the impact of M&A.
Underlying and organic measures are defined on page 261 of Sage's FY24 Annual
Report.

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