Sage looks to emerging markets as revenues climb 30%

Software giant Sage is eyeing opportunities in emerging markets as it aims to
build on a 30% rise in earnings to £1.1bn for the year ended 30 September 2007.

Emerging markets only accounted for £76m of Sage’s total revenue in the
financial year. The company acquired Creative, which has a presence in Malaysia
and Singapore, and is planning to be more active in emerging markets.

‘Emerging markets are where the growth is – we have been doing research in
the BRIC economies and have built good relationships there,’ said finance
director Paul Harrison, who also said acquisitions would be the preferred route
to entering new markets.

The UK market saw revenues rise from £204.4m to £217.7m as improvements to
the technology and service on the core Sage 50 small business accounting product
reaped dividends.

Harrison said Sage 50 was well-positioned for further growth and played down
fears that a Microsoft launch in the small business space would hurt growth

‘Microsoft has adopted a similar model in the US, where they enter the market
at a low price and eventually offer the product free of charge. We haven’t been
hurt there because service is so important and that is where we are strong,’
said Harrison.

Pre-tax profits Sage rose 14% to £251.3m and the company rebased its
dividend, which grew by 95% from 2.51p per share to 5.73p per share.

Sage shares were trading 7.4% higher at 208p following the announcement.

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