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by Mark Halper, Contributing Editor Posted on Thursday, May 08, 2008 4:36:35 PM Sign Up to receive Daily News Alerts in your E-mail Inbox    | Abstract: | The enterprise software purveyor experienced a dose of sales weakness in North American market, but international sales carried the day.
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| Keywords: | Sage Software, Sage ERP |
British enterprise software vendor Sage Group continued to benefit from its push into service-enabled software, as it reported that revenue and EBITA for the first half of fiscal 2008 both rose by 9%, to £640.5 million and £138 million, respectively.
Operating margins for the six months ended March 31, 2008, registered a healthy 24%, which CEO Paul Walker attributed, in part, to the company’s emphasis on selling on-demand software subscriptions that provide customers with ongoing business support and product upgrades. The company received about 60% of its revenue from subscription contracts in the half, Walker said. CFO Paul Harrison added that such “recurring revenue” grew by 11%, while non-recurring software sales grew by 3%.
The upbeat report overcame a gloomy first half for Sage Software, the company’s North American division, where sales stagnated at £248. 5 million compared with £249 million in the same period a year earlier, and EBITA dropped 7% to £43.5 million. Sage blamed the decline on difficulties in the healthcare division, which the company is restructuring. Sage Software, the largest unit under the Sage umbrella, welcomed a new CEO this March, and officials are intent on getting the North American division back onto a solid growth track.
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