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4	4
5		-Summary
	5	+= Summary =
6	6
7		-Sage is the market leader for integrated accounting, payroll, and payment systems, supporting the ambition of the world’s entrepreneurs.
	7	+* Sage is the market leader for integrated accounting, payroll, and payment systems, supporting the ambition of the world’s entrepreneurs.
	8	+* With over 11,000 colleagues the comapny support millions of entrepreneurs across more than 20 countries as they power the global economy.
	9	+* Sage Business Cloud is a suite of unified solutions that add high value with common services, supported by a rich and robust marketplace of ISV apps and emerging tech across Artificial Intelligence, Machine Learning and automation.
8	8
9		-With over 11,000 colleagues the comapny support millions of entrepreneurs across more than 20 countries as they power the global economy.
10	10
11		-Sage Business Cloud is a suite of unified solutions that add high value with common services, supported by a rich and robust marketplace of ISV apps and emerging tech across Artificial Intelligence, Machine Learning and automation.
	12	+[[image:SGGEF0.png||height="280" width="718"]]
12	12
13	13
14		-Company Overview
	15	+= Company Overview =
15	15
16		-Sage is the market leader for integrated accounting, payroll, and payment systems, supporting the ambition of the world’s entrepreneurs.
	17	+Sage (OTC:SGGEF, UK:SGE) is the market leader for integrated accounting, payroll, and payment systems, supporting the ambition of the world’s entrepreneurs.{{footnote}}https://www.sage.com/en-gb/about-us/{{/footnote}}
17	17
18		-[[https:~~/~~/www.sage.com/en-gb/about-us/>>url:https://www.sage.com/en-gb/about-us/]]
19	19
20		-
21	21	Like many of the businesses the company serve, Sage began as a small business and has grown beyond what seemed imaginable. Today over 11,000 colleagues now support millions of entrepreneurs across more than 20 countries as they power the global economy.
22	22
23	23
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27	27	The company's social and mobile technology provides live information so you can make fast, informed decisions anytime, anywhere in the world. The company support its business builders for life by offering choice, support, expertise, and innovation. The company champion your causes and provide world-leading advice and support when you need it most.
28	28
29	29
30		-Products and Services
	29	+[[image:SGGEF1.jfif]]
31	31
	31	+
	32	+== Products and Services ==
	33	+
32	32	Sage serves millions of small and mid-sized customers around the world
33	33
34	34
35		-Small businesses
	37	+=== Small businesses ===
36	36
37	37	Small customers are typically owner-run businesses with professionals or small teams responsible for finances and human resources. They are looking to automate accounting and compliance while managing costs and cash flow. The company's solutions are simply tailored to their specific needs, enabling them to prioritise their time and stay on top of regulations.
38	38
39	39
40		-Mid-sized businesses
	42	+=== Mid-sized businesses ===
41	41
42	42	Mid-sized customers are often scaling and transforming, with functions structured around specialist teams and departments. They are focused on growth and efficiency, requiring insight and automation. The company's solutions give finance and HR professionals insights to help their organisations analyse, strategise, and anticipate, by effectively integrating processes and procedures.
43	43
...	...	@@ -45,12 +45,25 @@
45	45	Sage Business Cloud is a suite of unified solutions that add high value with common services, so customers can integrate and migrate data across solutions. This is supported by a rich and robust marketplace of ISV apps and emerging tech across Artificial Intelligence, Machine Learning and automation.
46	46
47	47
	50	+(% style="width:1005px" %)
	51	+|(% style="width:225px" %)**Accounting software**|(% style="width:252px" %)**People and Payroll**|(% style="width:204px" %)**Business management**|(% style="width:321px" %)**Solutions for accountants and ​​bookkeepers**
	52	+|(% style="width:225px" %)Accounting|(% style="width:252px" %)Payroll|(% style="width:204px" %)Sage X3|(% style="width:321px" %)Sage for Accountants
	53	+|(% style="width:225px" %)Sage 50cloud Accounts|(% style="width:252px" %)Sage HR|(% style="width:204px" %)Sage 200|(% style="width:321px" %)Client management
	54	+|(% style="width:225px" %) |(% style="width:252px" %)Sage 50cloud Payroll|(% style="width:204px" %)Sage CRM|(% style="width:321px" %)Sage Accounting​
	55	+|(% style="width:225px" %) |(% style="width:252px" %)Sage 50 P11D|(% style="width:204px" %)Sage Intelligence|(% style="width:321px" %)Sage Payroll
	56	+|(% style="width:225px" %) |(% style="width:252px" %)Sage People|(% style="width:204px" %) |(% style="width:321px" %)​AutoEntry
	57	+|(% style="width:225px" %) |(% style="width:252px" %)Sage HR Advice Director|(% style="width:204px" %) |(% style="width:321px" %)Accounts Production and Tax
	58	+|(% style="width:225px" %) |(% style="width:252px" %)Sage HR Advice Manager|(% style="width:204px" %) |(% style="width:321px" %)Payroll Bureau
	59	+|(% style="width:225px" %) |(% style="width:252px" %)Sage 50 HR|(% style="width:204px" %) |(% style="width:321px" %)
	60	+|(% style="width:225px" %) |(% style="width:252px" %)Sage Employee Benefits|(% style="width:204px" %) |(% style="width:321px" %)
48	48
49		-<table>
50	50
51	51
52		-Financial Overview
	64	+[[image:SGGEF3.jpg]]
53	53
	66	+
	67	+= Financial Overview =
	68	+
54	54	In FY21 Sage achieved organic recurring revenue growth of 5% to £1,637m and organic total revenue growth of 3% to £1,778m. The increase in recurring revenue was underpinned by a 19% rise in Sage Business Cloud revenue to £997m, reflecting strength from new customer acquisition together with continued progress in migrating existing customers from desktop to cloud solutions.
55	55
56	56	Other revenue (SSRS and processing) declined by 18% to £141m, in line with its strategy to transition away from licence sales and professional services implementations.
...	...	@@ -64,84 +64,115 @@
64	64	The increase in cloud connected recurring revenue of 14% to £711m reflects growth in both the Sage 50 and Sage 200 franchises. This has been driven by the migration of existing customers, predominantly in International, as well as further growth from new customers acquired in the period.
65	65
66	66
67		-Revenue
	82	+[[image:SGGEF2.png]]
68	68
	84	+
	85	+== Revenue ==
	86	+
69	69	Organic total revenue increased by 3% in FY21 to £1,778m. Organic recurring revenue grew by 5% to £1,637m, supported by an 11% increase in software subscription revenue to £1,242m, reflecting the continued focus on attracting new customers and migrating existing customers to subscription and Sage Business Cloud. The decline in other recurring revenue of 10% to £395m reflects customers migrating from maintenance and support to subscription contracts. Other revenue (SSRS and processing) declined by 18% to £141m, in line with its strategy to transition away from licence sales and professional services implementations.
70	70
71		-North America
72	72
	90	+**North America**
	91	+
73	73	North America achieved organic recurring revenue growth of 7% to £641m and organic total revenue growth of 6% to £687m. Sage Business Cloud penetration is now 73%, up from 71% in the prior year, driven by growth in cloud native and cloud connected solutions, while subscription penetration is 66%, up from 61% in the prior year
74	74
	94	+
75	75	Cloud native growth was driven through Sage Intacct, which delivered recurring revenue growth of 22% to £164m reflecting continued strong progress driven by accelerating new customer acquisition.
76	76
	97	+
77	77	Recurring revenue in the US increased by 8% to £543m, driven by Sage Intacct together with continued growth in small and medium cloud connected products, primarily the Sage 200 franchise and supported by Sage 50 solutions. Total revenue for the US increased by 6% to £584m.
78	78
	100	+
79	79	In Canada, recurring revenue increased by 6% to £98m and total revenue by 5% to £103m, driven by growth in Sage 50 cloud and Sage 200 cloud solutions.
80	80
81		-Northern Europe
82	82
	104	+**Northern Europe**
	105	+
83	83	Northern Europe (UK & Ireland) achieved organic recurring revenue growth of 4% to £391m and organic total revenue growth of 2% to £402m. Sage Business Cloud penetration is now 86%, up from 82% in the prior year, while subscription penetration is 90%, up from 85% in the prior year.
84	84
85		-International
86	86
	109	+**International**
	110	+
87	87	The International region achieved organic recurring revenue growth of 4% to £605m and organic total revenue growth of 1% to £689m. Sage Business Cloud penetration is now 47%, up from 35% in the prior year, while subscription penetration is now 62%, up from 56% in the prior year.
88	88
	113	+
89	89	The International region achieved organic recurring revenue growth of 4% to £605m and organic total revenue growth of 1% to £689m. Sage Business Cloud penetration is now 47%, up from 35% in the prior year, while subscription penetration is now 62%, up from 56% in the prior year.
90	90
	116	+
91	91	Central Europe achieved recurring revenue growth of 6% to £102m while total revenue increased by 4% to £132m. Growth in the region is driven by a combination of cloud connected and local products.
92	92
	119	+
93	93	In Iberia, while subscription revenue increased by 18%, overall recurring revenue decreased by 2% to £121m, reflecting a reduction in maintenance and support revenues, as non-subscription customers opted not to renew their maintenance and support contracts, principally during the first half. Total revenue decreased by 4% to £137m.
94	94
	122	+
95	95	Africa & APAC delivered strong recurring revenue growth of 9% to £125m, driven by a continued good performance in cloud native solutions, particularly Sage Accounting in Africa, and supported by growth in local products. Total revenue in Africa & APAC was broadly flat at £139m compared with the prior year.
96	96
97	97
98		-Operating profit
	126	+== Operating profit ==
99	99
100	100	The Group achieved organic operating profit of £343m (FY20: £380m), representing a margin of 19.3% (FY20: 22.0%). This margin reflects increased strategic investment in sales and marketing and product development (R&D) to drive growth. During the year, the Group reassessed its bad debt provision in connection with Covid-19, resulting in an £8m credit to operating profit.
101	101
	130	+
102	102	Underlying operating profit was £358m (FY20: £400m), representing a margin of 19.4% (FY20: 21.6%). The difference between organic and underlying operating profit reflects the operating profit from assets sold during the period (Sage’s businesses in Poland, Australia and Asia in FY21, and Sage Pay and the Brazilian business in FY20) and assets held for sale (Sage’s business in Switzerland and Sage’s South African payroll outsourcing business).
103	103
	133	+
104	104	EBITDA was £443m (FY20: £486m) representing a margin of 24.1%. The reduction in EBITDA reflects the additional strategic investment made during the year. While the charge for share based payments increased by £7m to £36m (FY20: £29m) reflecting the expansion of equity reward schemes, this was offset by an £8m reduction in underlying depreciation and amortisation to £49m (FY20: £57m) as a result of the Group’s property rationalisation programme and assets held for sale.
105	105
106		-Net finance cost
107	107
	137	+**Net finance cost**
	138	+
108	108	The statutory net finance cost for the period decreased to £26m (FY20: £31m), primarily reflecting the reduced impact from FX movements on intercompany balances, and is broadly in line with the underlying net finance cost of £25m (FY20: £25m).
109	109
110		-Taxation
111	111
	142	+**Taxation**
	143	+
112	112	The underlying tax expense for FY21 was £83m (FY20: £84m), resulting in an underlying tax rate of 25% (FY20: 23%). The statutory income tax expense for FY21 was £62m (FY20: £63m), resulting in a statutory tax rate of 18% (FY20: 17%).
113	113
114		-Earnings per share
115	115
	147	+**Earnings per share**
	148	+
116	116	Underlying basic earnings per share of 23.09p was 14% lower than the prior period (FY20: 26.74p), reflecting the decrease in underlying operating profit due to additional strategic investment.
117	117
118		-Net debt and liquidity
119	119
	152	+**Net debt and liquidity**
	153	+
120	120	Group net debt was £247m at 30 September 2021 (30 September 2020: £151m), comprising cash and cash equivalents of £567m (30 September 2020: £848m) and total debt of £814m (30 September 2020: £999m).
121	121
	156	+
122	122	The Group’s debt is sourced from a syndicated multi- currency Revolving Credit Facility (RCF), US private placement (USPP) loan notes, and sterling denominated bond notes. The Group’s RCF expires in February 2025 with facility levels of £669m (split between US$719m and £135m tranches). At 30 September 2021, the RCF was undrawn (FY20: £294m)
123	123
124	124
125		-Trading update for the three months ended 31 December 2021
	160	+[[image:SGGEF4.jpg]]
126	126
127		-26 January 2022; The Sage Group plc issues a trading update for the three months ended 31 December 2021.
128	128
129		-[[https:~~/~~/www.sage.com/investors/-/media/files/investors/documents/pdf/downloads/results/q1%202022%20results/q1%20fy22%20trading%20update.pdf>>url:https://www.sage.com/investors/-/media/files/investors/documents/pdf/downloads/results/q1%202022%20results/q1%20fy22%20trading%20update.pdf]]
	163	+**Trading update for the three months ended 31 December 2021**
130	130
131		-Jonathan Howell, Chief Financial Officer, commented:
	165	+**26 January 2022**; The Sage Group plc issues a trading update for the three months ended 31 December 2021.{{footnote}}https://www.sage.com/investors/-/media/files/investors/documents/pdf/downloads/results/q1%202022%20results/q1%20fy22%20trading%20update.pdf{{/footnote}}
132	132
	167	+
	168	+**Jonathan Howell, Chief Financial Officer, commented:**
	169	+
133	133	“Sage has made a strong start to the year, accelerating growth in line with expectations. Sage Business Cloud has performed particularly well, driven by continued growth in both cloud native and cloud connected solutions, as the company execute on its strategy to be the trusted network for small and mid-sized businesses. Accordingly, the company reiterate its guidance for the full year, as set out in its FY21 results announcement.”
134	134
	172	+
135	135	Recurring revenue grew by 8% to £429m, underpinned by a 21% rise in Sage Business Cloud revenue to £280m, with continued strength in new customer acquisition. Software subscription revenue grew by 13% to £336m (Q1 21: £296m), increasing subscription penetration to 73% (Q1 21: 68%).
136	136
	175	+
137	137	Regionally, North America achieved growth in recurring revenue of 11% to £174m (Q1 21: £157m) reflecting further strength in Sage Intacct, together with growth in cloud connected products. In Northern Europe, recurring revenue increased by 7% to £102m (Q1 21: £96m), driven by accelerating growth in cloud native solutions including Sage Accounting and Sage Intacct. In International, recurring revenue increased by 5% to £152m (Q1 21: £145m), with growth across Sage Business Cloud supported by further progress in migrations.
138	138
	178	+
139	139	In terms of the portfolio view of recurring revenue, the Future Sage Business Cloud opportunity (products within, or to be migrated to, Sage Business Cloud) grew 10% to £394m. This was driven by strong growth in cloud native revenue of 44% to £90m (Q1 21: £62m) primarily through new customer acquisition, as well as further growth in the cloud connected portfolio. Sage Business Cloud penetration increased to 71% (Q1 21: 65%).
140	140
	181	+
141	141	Other revenue (SSRS and processing) decreased by 22% to £29m, in line with its strategy to transition away from licence sales and professional services implementations.
142	142
	184	+
143	143	Total Group revenue increased by 5% to £458m
144	144
	187	+
145	145	On 17 January 2022, Sage completed the previously announced acquisition of Brightpearl, a cloud native multichannel retail management system for the retail and ecommerce vertical. The acquisition accelerates its strategy for growth, including scaling Sage Intacct, broadening the value proposition for mid-sized businesses and expanding Sage’s digital network.
146	146
147		-References
	190	+
	191	+= References =
	192	+
	193	+{{putFootnotes/}}