Sage Group PLC on Wednesday reported double-digit annual revenue growth, and began a share buyback of £350 million.

The Newcastle-upon-Tyne, England-based software business said the buyback programme will run until April 23.

Shares in Sage were up 10% at 1,097.00 pence each in London on Wednesday morning.

In addition, Sage reported that revenue for the year ended September 30 rose 12% to £2.18 billion from £1.95 billion a year prior, and annualised recurring revenue rose 11% to £2.19 billion from £1.96 billion. This was driven by growth across its Sage Business Cloud software portfolio, it said.

However, pretax profit dropped 16% to £282 million from £337 million the year before, as the firm’s operating profit margin shrunk to 14.4% from 18.9%. Sage also reported a 41% rise in its finance costs to £45 million from £32 million in financial 2022.

Diluted earnings per share were 21% lower at 20.43 pence, compared to 24.15p a year ago.

Sage proposed a final dividend of 12.75p per share, which brings its full-year dividend up 5% to 19.3p from 18.4p the previous year.

Looking ahead, the firm said it entered financial 2024 ‘with good momentum’ and expects organic revenue growth to be broadly in line with the prior year. It expects operating margin to improve in the current year and beyond, as it focuses on ‘efficiently scaling the group’.

Commenting on the results, Chief Executive Officer Steve Hare said: ‘Small and mid-sized businesses are continuing to digitalise, despite the macroeconomic uncertainty. We are building a resilient platform to deliver sustained, efficient growth, and I am confident that Sage is well positioned to take advantage of the market opportunity in 2024 and beyond.’

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