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Sage Group PLC on Wednesday raised its dividend after ‘significant’ margin expansion helped drive a marked improvement in profit, with North America a strong performer. The Newcastle upon Tyne, England-based accountancy software provider said pretax profit rose 14% to £484 million in the financial year that ended September 30 from £426 million the year prior. Operating profit increased 17% to £530 million from £452 million with an improved operating margin of 21.4% compared to 19.4%. Revenue increased 7.8% to £2.51 billion from £2.33 billion, or by 9% on an organic basis, and basic earnings per share improved 18% to 37.7 pence from 32.1p. Sage reported growth across all regions balanced between new and existing customers. In North America, revenue grew by 12%, with a strong performance from Sage Intacct together with continued growth in Sage 200 and Sage 50. In the UK, Ireland, Africa & Asia Pacific region, revenue increased by 9%, driven by Sage Intacct together with cloud solutions for small businesses including Sage 50. In Europe, revenue increased by 7%, with growth across accounting, payroll and HR solutions. Sage Business Cloud revenue increased by 13% to £2.08 billion from £1.84 billion, including cloud native revenue growth of 23% to £885 million from £718 million. Subscription penetration increased to 83% from 82%, driving growth in subscription revenue of 12% to £2.09 billion from £1.88 billion. Chief Executive Officer Steve Hare, said Sage delivered ‘another good performance’ in the financial year with ‘strong, broad-based revenue growth and significant margin expansion.’ He said AI is opening up ‘new possibilities’ and creating a ‘significant opportunity’ for Sage, enabling ‘us to enhance and accelerate the benefits our software provides’. Sage declared a final dividend of 14.4p, increasing the full-year payout by 6.8% to 21.85p from 20.45p a year ago, in line with ‘our progressive policy.’ In addition, Sage announced a £300 million share buyback, saying this reflects its strong cash generation, robust financial position, and the board’s confidence in Sage’s future prospects. The programme, to be run by JP Morgan Securities PLC and Morgan Stanley & Co International PLC, will start on Wednesday and is expected to end no later than March 19 next year. Looking ahead to the new financial year, which ends in September 2026, Sage expects organic total revenue growth to be 9% or above, while operating margins are expected to continue trending upwards. Shares in Sage were up 4.2% at 1,121.00p each in London on Wednesday morning. Copyright 2025 Alliance News Ltd. All Rights Reserved.
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