ACCOUNTANCY software firm Sage predicted a return to revenue growth yesterday as its boss of 16 years prepares to step down.
Chief executive Paul Walker said pent-up demand was generated as small businesses put off upgrading software during the downturn. He said this would boost the firm’s revenues as the economy continues to fight through a tentative recovery.
Walker’s departure looks set to drag out by as much as nine months despite rumours he was on the brink of leaving before the summer. Finance director Paul Harrison is a strong internal candidate to eventually fill the breach, as is British head Paul Stobart and US chief Sue Swenson.
Stringent cost cutting improved profitability, as it stripped an annualised £54m, or five per cent of its cost base. It reported a pre-tax profit of £177.5m, beating a £160.7m analyst consensus. However, revenue of £270m from the US and Europe – Sage’s two biggest markets – fell six per cent and four per cent respectively. Revenue of £122m in the UK was flat year-on-year.
Broker Panmure Gordon is forecasting full-year adjusted pre-tax profit of £350m.