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Software giant on track to hit growth targets ; results [Newcastle Journal (England)](Newcastle Journal (England) Via Acquire Media NewsEdge) SOFTWARE giant, The Sage Group plc, says it is on track to hit ambitious growth targets. In an interim management statement, the Newcastle headquartered company reported revenue increased by 4.7%, over the first nine months of the year. During the third quarter - from April 1 to date - the group achieved 4.3% revenue growth. Performance in the fourth quarter was expected to be stronger and that the business remained on course to achieve the 6% organic revenue growth target set for 2015. Strong performance across the firm's subscription business helped to drive organic recurring revenue growth of 7.2% for the quarter. Pricing pressures created a weaker performance in Sage's payments business, particularly in North America, and the company said it remained cautious on the outlook for payments growth in the fourth quarter. Chief executive Guy Berruyer said: "The performance of the business continues to be solid and the overall growth trajectory is on track. "Recurring revenue growth of 7%, driven by a strong subscription performance, demonstrates our business has momentum, and we remain confident of achieving our target of 6% organic revenue growth in 2015." The results follow news this week of Gosforth-based Sage's acquisition of German payroll outfit, Exact Software Deutschland GmbH, in a deal worth EUR 16.25m (Pounds 12.87m). Exact Software Deutschland is the payroll business of Dutch software firm Exact Holding NV. Sage said the move - made by its German subsidiary Sage Software GmbH - represents a transformative acquisition for its payroll business in Germany, increasing payroll revenue to approximately EUR 30m (Pounds 23.7m) as well as establishing Sage as one of the two leading players in this segment in Germany. Exact's Lohn product provides payroll solutions ranging from payroll software products to full business process outsourcing solutions. In 2013, the firm reported revenue of EUR 10.5m (Pounds 8.3m). The deal requires approval from the German Federal Cartel Office and is expected to close in the third quarter of 2014. If successful, Exact Lohn is to be integrated into Sage's German business. The Sage Group's operating cash generation also remains strong. During the period, it paid an ordinary dividend to shareholders of Pounds 45m. It has likewise continued with its share buyback programme and, since April 1, a further 8.7m shares have been repurchased for a consideration of Pounds 33m. Net debt at June 20 was Pounds 345m, compared to Pounds 361m at March 31. We remain confident of achieving our target of 6% organic revenue growth in 2015Guy Berruyer (c) 2014 ProQuest Information and Learning Company; All Rights Reserved. |