NEWCASTLE UPON TYNE (dpa-AFX) - Sage Group plc (SGE.L) reported Thursday that its first-quarter group organic revenue increased by 7.6 percent to 465 million pounds.
In its trading update for the three months ended December 31, 2018, the company said its recurring revenue increased by 10.5 percent to 387 million pounds, underpinned by software subscription growth of 27.7 percent to 237 million pounds.
However, Software and software related services or SSRS revenue declined by 5.8 percent to 65 million pounds, reflecting the managed decline in licences as the business transitions to subscription, offset by a slight increase in services.
Regionally, North America delivered revenue growth of 10.4 percent to 154 million pounds, with double digit recurring revenue driven by cloud connected solutions and Sage Intacct.
The UKI showed strong signs of recovery with revenue growth of 5.9 percent to 96 million pounds, and double digit recurring revenue growth driven by Sage 50 cloud connected migrations.
Sage announced on January 15, 2019 that it has entered into an agreement for the sale of Sage Payroll Solutions to iSolved HCM, LLC. This business was classified as held for sale and excluded from organic numbers at year end fiscal 2018.
Steve Hare, Chief Financial Officer, said, 'We have been encouraged by the strong start to FY19, reflecting the renewed focus on high-quality subscription and recurring revenue as we continue the journey to becoming a great SaaS business. Looking ahead we reiterate our full year guidance for FY19 as outlined at the FY18 results announcement.'
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