Interim Management Statement

RNS Number : 7070H

Sage Group PLC

16 July 2012

 

The Sage Group plc Interim Management Statement

16 July 2012

The Sage Group plc ("Sage") is today issuing its interim management statement which covers the period from 1 April 2012 to date.

Financial Performance

Despite a toughening economic environment, trading remains broadly in-line with expectations at the time of the interim results announcement on 9 May 2012.

North America continued to demonstrate the sequential quarter by quarter improvement in trading which was anticipated to be a feature of the year.

The variable trading performance evident in the first half in Europe continued in the third quarter.  The UK and Ireland business demonstrated good growth although conditions in mainland European markets have toughened.  Overall performance in Europe has been flat and the anticipated improvement in growth over the first half has not yet materialised.

AAMEA continues to perform well, with growth driven by strong performances by South Africa and Australia.  The expansion into the wider African continent continues to be a feature of the South African growth whilst Australia continues to grow ahead of GDP.

Acquisition of Folhamatic Group ("Folhamatic")

On 28 June 2012, we completed the acquisition of a controlling interest in Folhamatic, a leading provider of accounting, tax and payroll and regulatory content software in Brazil for an expected total consideration of £125m (R$398m) for 75% of the equity.  Folhamatic has a leading market position in a large and growing economy and the acquisition represents an important step in building Sage's presence in a key emerging market. 

Financial Position

The Group`s strong operating cash generation has continued and, during the quarter, the return of the £200m proceeds from the disposal of Sage Software Healthcare LLC to Vista Equity Partners was completed, with 71m shares repurchased. As previously announced, the share buyback programme is continuing and, to date, a further 6.2m shares have been repurchased for a consideration of £17.6m.  Net debt at 30 June 2012 was £121.7m (£122.1m net cash at 31 March 2012).

Guy Berruyer, Chief Executive, commented:

"The main trends we highlighted at our interim results in May continue to be a feature of our trading performance.  Whilst we remain cautious on the outlook for Europe, and watchful of this region's economic climate, the strong fundamentals of our business model remain and we continue to make good progress in executing against our business priorities.  We look forward to tomorrow's investor day where we will be sharing our plans for the future growth of the business."

About The Sage Group plc

The Sage Group plc is the leading global supplier of business management solutions to small and medium-sized enterprises. Formed in 1981, Sage was floated on the London Stock Exchange in 1989. Sage has over 6 million customers and more than 12,300 employees worldwide. We operate in over 23 countries covering the UK, mainland Europe, North America, South Africa, Australia, India and China. For further information pleasevisit www.sage.com

Enquiries:

The Sage Group plc [phone]

Guy Berruyer, Chief Executive
Paul Harrison, Cheif Finance Officer
Murdo Montgomery, Investor Relations

Tulchan Communications [phone]

David Shriver
Lucy Legh

 

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