Business
Update on financial reporting
Update on financial reporting.
About this update from Sage Group Plc
Update on financial reporting 7 December 2023 As announced in Sage's FY23 results on 22 November 2023, The Sage Group plc. ("Sage" or the "Group") intends to simplify its revenue reporting to enable continued, clear understanding of progress and performance given the recent evolution of the Group, as set out below. These changes will be introduced in Sage's Q1 24 trading update, and will apply to Sage's future financial reporting. Move from recurring to total revenue Sage has previously provided revenue metrics and analysis based primarily on recurring revenue. Going forward, Sage will focus its reporting on total revenue, as total and recurring revenue growth rates increasingly converge as a result of the reduction in other revenue (SSRS), in line with the Group's strategy [1] . To facilitate comparison with prior periods, the appendix to this announcement sets out key total revenue figures for FY22 and FY23. Annualised Recurring Revenue (ARR) growth will continue to be provided as a strategic KPI. Focus on revenue performance by region Previously Sage has reported revenue performance by region, by portfolio and by type. Reflecting the strong progress made in Sage's transition to subscription and the cloud, revenue analysis by portfolio and by type, together with cloud native ARR and Sage Business Cloud penetration [2] , will no longer be provided. In future, Sage will principally report total revenue performance, including commentary on the drivers of growth, on a regional basis. In addition, certain metrics including cloud native total revenue, Sage Business Cloud total revenue and subscription revenue, will be disclosed on a Group basis. Sage's primary annual and interim financial statements and notes to the accounts will not be impacted by these changes. Enquiries: Sage: +44 (0) 7341 479956 FGS Global: +44 (0) 20 7251 3801 James Sandford, Investor Relations Conor McClafferty David Ginivan , Corporate PR Sophia Johnston APPENDIX - Underlying Total Revenue [3] FY23 - Underlying total revenue (£m) Q1 23 H1 23 Q3 23 YTD FY 23 North America 242 483 724 973 US [4] 420 846 Canada 63 127 UKIA 155 311 468 627 UK & Ireland 233 471 Africa & APAC 78 156 Europe 143 293 438 584 France 148 295 Central Europe 71 142 Iberia 74 147 Total revenue 540 1,087 1,630 2,184 Sage Business Cloud 397 802 1,222 1,657 of which cloud native 146 293 449 612 FY22 - Underlying total revenue (£m) Q1 22 H1 22 Q3 22 YTD FY 22 North America 210 420 633 849 US 363 734 Canada 57 115 UKIA 140 284 426 575 UK & Ireland 213 435 Africa & APAC 71 140 Europe 143 285 422 558 France 142 280 Central Europe 73 141 Iberia 70 137 Total revenue 493 989 1,481 1,982 Sage Business Cloud 304 621 947 1,324 of which cloud native 101 212 331 459 [1] Recurring revenue represented 96% and other revenue (SSRS) represented 4% of total Group revenue in FY23. [2] Sage's other strategic KPIs, including ARR growth, renewal rate by value and subscription penetration, will continue to be provided. [3] The above figures are provided at FY23 exchange rates. In line with Sage's APM definitions, FY23 figures will be retranslated at current period exchange rates when reported as comparator figures in FY24, to enable performance to be assessed on a constant currency basis. [4] Sage Intacct revenue performance will be included in the narrative going forward and will no longer be tabulated.