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Financial performance

Watch Steve Hare introduce our Full Year 23 results.

Investment case

Building sustainable shareholder value

Our scale and experience form the foundations for our sustainable growth, and are core to Sage’s investment case.

Diversified and differentiated

  • Serving a wide range of SMBs across diverse geographies, with deep expertise across financials, payroll and HR.
  • Broad ecosystem of partners, accountants, resellers and
    ISVs who enrich and expand the reach of our offering.
  • Solutions backed by business advice and human
    customer support.

19 countries

Focused on innovation

  • Rolling out global cloud solutions across our markets, led by Sage Intacct.
  • Adding value to existing and new customers by delivering new cloud services.
  • Scaling and leveraging the Sage Network to deliver innovative AI-powered solutions, transforming the
    workflows of SMBs.

£342m R&D spend
in FY23


Delivering efficient, sustainable growth

  • Focused on scaling the business, with growth creating headroom to increase investment and expand margins.
  • Growth supported by favourable SMB drivers including the need to raise productivity through digitalisation and compliance.
  • Strong commitment to ESG supporting the long-term sustainability of Sage.

ARR growth 11 %
in FY23

Robust financial model

  • High-quality revenue base which is over 96 % recurring, with 79 % from software subscription.
  • Highly cash generative, low capital intensity business, with underlying cash conversion over 100 % for each of the last five years.
  • Organic and inorganic investment balanced with dividends and additional capital returns to shareholders where appropriate.

Cash conversion 116 %
in FY23

A summary of our recent financial performance and strategic KPIs.


 FY23  FY22  FY21
Alternative performance measures
     
Underlying total revenue £2,184m £1,982m  £1,909m
Underlying total revenue growth
10 %
4 %
0 %
Underlying recurring revenue
£2,096m
£1,875m
£1,751m
Underlying recurring revenue growth
12 %
7 % 3 %
Recurring revenue penetration
96 %
95 % 92 %
Underlying operating margin
20.9 %
19.5 % 19.7 %
Underlying basic EPS 32.3p
26.4p
23.1p
Underlying cash conversion
116 %
107 % 126 %
Statutory measures
     
Revenue £2,184m
£1,947m
£1,846m
Operating profit £315m
£367m
£373m
Operating profit margin
14.4 %
18.9 %
20.2 %
Basic EPS 20.7p
25.5p
26.3p
Dividend per share
19.30p
18.40p 17.68p


  FY23
 FY22  FY21
Annualised recurring revenue (ARR) growth 11%
12% 4%
Renewal rate by value
102%
101%
99%
Subscription penetration
79%
75% 69%
Sage Business Cloud penetration
84%
75% 66%


Definitions of Sage’s Alternative Performance Measures and KPIs can be found on pages 269-270 of Sage’s FY23 Annual Report and Accounts.

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