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SAGE 50 BEHIND FIRST HALF GROWTH Featured

Stephen Kelly, SageCloud versions of Sage 50, which is really different products in different companies, drove revenue growth for Sage's first half ended March 31. And subscriptions continued to rise as license revenue fell—the latter off 9 percent in the United States. Overall, executives were in a good mood about results. In this week's earnings webcast, CEO Stephen Kelly said the company achieved "double-digit recurring revenue growth for the first time this decade."

CFO Stephen Hare added, "This growth was driven by Sage 50 cloud which was available through the period in Canada but was only launched in the U.S in February." The company said Sage 50 subscription units increased by around 25,000 in North America.  Worldwide net income was approximately $206.4 million in the recently ended half, up 10.8 percent from a year ago. Revenue was about $1.1 billion, an increase of 4.1 percent. Organic growth rose by 6 percent the company said. North American revenue reached about $369.5 million, an increase of 9 percent on a statutory basis. Organic revenue for the continent rose by 6 percent, compared to a 3-percent increase in that category in 2015. In North America, payment revenue was up 2 percent, compared to flat results for fiscal 2015. Meanwhile, sales of X-3 boomed, growing 17 percent worldwide, although product sales were flat in North America. In the cost-cutting area, Sage expects about $72.2 million annualized G&A savings by the end of the fiscal year. Kelly also reported personnel change at Sage has continued at a significant pace. When he delivered the fiscal 2015 results, he said 40 of the top 100 company employees were new. This week, he said the total was 70 new over the last 18 months.

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