Sage advice is that UK rise offsets US dip

ACCOUNTANCY software firm Sage offset a disappointing performance in North America to post half-year figures ahead of market expectations.

The group further buoyed investors – shares rose 7.4 per cent to 226.5p yesterday – by pointing out that 60 per cent of its revenues came from recurring subscription contracts, leaving it well-positioned for growth in challenging economic conditions.

Sage reported adjusted pre-tax profits of £138 million for the six months to 31 March, a gain of 9 per cent on a year earlier, after businesses in the UK, mainland Europe and the rest of the world achieved good revenues and profit growth.

North America disappointed with flat revenues and a dip in profits, but Sage said it had taken steps to improve the division's healthcare arm.

The Newcastle-based firm axed North American chief executive Ron Verni and finance director Jim Eckstaedt last October after disappointing sales figures.

The figures improved on the guidance given by Sage earlier this year. Stockbroker Panmure Gordon said sales of £640m were £23m higher than market expectations, while profits beat consensus expectations by £9m.