Sage Group Plc (SGE), the U.K.’s biggest software maker, rose the most in almost five years after reporting revenue growth that exceeded analysts’ estimates.
Sales, excluding items such as acquisitions and currency fluctuations, rose 5 percent in the fiscal second half, beating the 3 percent analysts predicted on average, Numis Securities said today in a note. Full-year underlying revenue rose 4 percent to 1.26 billion pounds ($2.1 billion), Newcastle-upon-Tyne, England-based Sage said today.
Sage, which provides accounting and payroll software to more than 6 million mostly small and medium-sized businesses, forecast a 6 percent revenue gain for 2015. Operating income adjusted for non-recurring items during the year increased 2 percent to 376 million pounds.
“This moves management’s 6 percent 2015 growth target from ‘aspirational’ to ‘achievable,’” Numis analysts said. The figures also beat estimates of analysts at Espirito Santo Investment Bank in London, who recommend buying Sage shares and called today’s earnings “an encouraging set of results with positive underlying business momentum.”
The shares rose as much as 9.8 percent in London, the most since December 2008, leading gainers in the Stoxx 600 Technology Index. The stock added 9 percent to 378.50 pence at 10:19 a.m., giving Sage a market value of 4.2 billion pounds.
“The strategy is working and growth is accelerating,” Sage Chief Executive Officer Guy Berruyer said in a statement. “We remain confident of achieving our target of 6 percent organic revenue growth in 2015, and anticipate further progress during the year ahead.”
To contact the reporter on this story: Kristen Schweizer in London at email@example.com