Sage says 2015 revenue rises likely to be in H2

3rd Dec 2014 07:35

Accountancy software group Sage hailed higher annual profits and the achievement of key financial milestones for 2014 and said it was on track to hit financial targets for 2015, although 2014 revenues fell. It also cautioned that revenue growth next year was likely to be weighted to the second half.Sage said a move to "higher quality" software subscription revenue had driven the results, with a 29% rise in the organic annual value of its software subscriber base to £220m.Software subscription revenue lifted 28% against 13% last year and recurring revenue made up 73% of group revenue versus 71% a year ago.The group said it had hit key financial milestones for 2014 with organic revenue growth of 5% against 4% last time and an organic operating profit margin of 27.5% against 27.1% a year ago.Operating profit climbed 65.3% to £298m but revenue fell 5% to just over £1.3bn.Sage said it was on track to achieve its financial targets for 2015."Revenue growth is increasing, the subscription base is growing and cloud momentum is building. The group remains confident of achieving 6% organic revenue growth in 2015, with the anticipated acceleration in growth weighted to the second half of the year, and organic operating profit margin of 28%."