Profit boost is State of the Art for Sage Group

Accountancy software developer Sage Group reported profit for the year up by 27 per cent, boosted by an acquisition in the US earlier this year.

Pre-tax profit rose to #47.6 million for the year ended 30 September, compared with #37.6 million for 1997. Turnover for the period increased by 26 per cent to #191.5 million against #152.1 million in 1997. Analysts had expected Sage to report pre-tax profit of about #46.3 million - about 18.2 per cent above last year.

Performance for the second half of the year was strong, benefiting from a full six months' contribution from US acquisition State of the Art, bought for $265 million in cash. State of the Art contributed #30.8 million to overall sales for the group and #6.1 million to pre-tax profit.

Sage, which targets SMEs, said it plans to grow through further acquisitions in Scandinavia, Spain, France and the US.

Analysts said there had been a healthy demand for the company's software as businesses looked to make their accounting systems millennium-compliant.

The company stated that all its products are year 2000 compliant and, where relevant, euro-compliant. This has helped drive demand for its software this year. Sage's shares have risen more than 80 per cent in the past 12 months.