The Sage Group (LON:SGE) has posted its half-year results this morning, unveiling improved organic revenue growth.
Highlights from the company statement:
The Group delivered organic revenue growth of 6.2% (H1 2015: 5.0%) and an organic operating profit margin of 25.4% (H1 2015: 26.4%).
The quality of the growth is demonstrated by recurring revenue growing at 10% (H1 2015: 8%) which includes growth of 35% (H1 2015: 25%) for software subscription revenue.
Organic figures neutralise the impact of foreign currency fluctuations and exclude the contribution from current and prior period acquisitions when relevant. A reconciliation of organic operating profit to statutory operating profit is shown on page 12. All H1 2015 comparatives and growth rates have been stated after the revenue reporting changes described in the FY15 full year results. Refer to notes 1 and 2 of interim financial statements for further details.
Statutory performance has been impacted by movements in key exchange rates during the year, particularly in Europe, South Africa and Brazil. Statutory figures also include the impact of acquisitions and disposals.
Stephen Kelly, Chief Executive Officer said: "Sage continues to perform and transform. We made a good start to FY16 with double digit recurring revenue growth as validation that customers are embracing closer subscription relationships. High quality organic revenue growth continued to accelerate H1 over H1.
"In this phase of the transformation, we have been very focussed on improving the capability of our management and creating a culture where customer obsession and innovation becomes a way of life at Sage. Our customers are the entrepreneurs who drive economic growth and prosperity. These entrepreneurs deserve awesome technology that is an enabler to their growth and success. The Sage cloud and partner ecosystem places the customer at the centre to provide a complete business solution from business start-up through scale-up to vibrant enterprise businesses.
"We are pleased with the early progress made and recognise there is still much to do in the transformation. We remain confident in achieving our full year targets of at least 6% organic revenue growth and organic operating margin of 27%."