Growth stalls at Sage

Weakness in Europe and the continued migration of customers onto subscription-based software has hampered growth at accountancy software provider Sage . Chief executive Guy Berruyer says that his management team have been working to "accelerate growth" and these plans will be unveiled on 17 July. Until then, shareholders will have to remain content with a 30 per cent dividend hike and an ongoing share buy-back programme.

European revenues rose a modest 1 per cent to £400m in the 12-month period as decent underlying revenue growth in UK and Ireland and Germany was offset by a 8 per cent slump in sales in Spain and a flat performance in France. The US did little to lift the numbers, either, posting flat revenues of £199m. And although emerging territories, including Africa, Asia and Australia, posted double-digit top-line growth, this segment only account for 11 per cent of the group total.

Moreover, increases in subscription-based software sales have barely offset declines in the traditional software business, with underlying subscription sales rising 5 per cent to £451m and traditional software sales falling 4 per cent to £221m.

Deutsche Bank expects full-year adjusted EPS to fall from 21.5p to 20.1p.

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