Acquisitions result in software giant's profits leaping by 56%.
Accounting software giant Sage has announced a sparkling pre-tax profit increase of 56% and revealed the result was largely due to the contribution of recent acquisitions. The Newcastle-based company said the £26.7m leap in pre-tax profits, which rose from £47.6m to £74.3m, was also due to its businesses in France – where turnover increased 38% to £73.5m and operating profit rose 91% to £19.8m. The firm said the purchases of Peachtree Software in the US, and Tetra and Taxsoft in the UK were already proving important strategic developments. ‘Our performance in the second half of the year was especially strong and was boosted by a full six months of contribution from both Peachtree, which was acquired in February, and Tetra in April,’ said chairman Michael Jackson. The company also outlined its plans to build closer links with the accountancy community. ‘Our UK business has shown robust growth this year. Turnover at Sage Software Ltd was up by 33% to the year ending 30 September 1999, with 90,000 more registered users of our products. ‘As well as being valuable customers, accountants have a high degree of influence over their own clients’ choice of products,’ added Jackson. Sage hopes to expand the number of small companies that run their books through its website portal. At the moment 1,000 small businesses run their books through the portal, but they aim to have two million customers by 2003. Meanwhile, the firm demonstrated it is not about to rest on its laurels with the launch of Final Accounts Production, which it is says has been designed to simplify the production and generation of final accounts. Sage Final Accounts Production is an updated version of Sage Audit 2000 and is so easy to understand, the company claims, ‘it can be used by trainee accountants in practice’. The software will cost around £600 and is fully Web-enabled, giving users access to Sage’s free Internet service, www.sage.com A spokesperson said: ‘It’s important that as more and more accountants look to find time to introduce new services, they have the tools available to help them deliver traditional services efficiently and accurately.’