Sage Group PLC (LSE:SGE) shares surged 19% to above 1,300p for the first time after the accounting software group reported improving profit margins and announced a £400 million share buyback.
In the year to 30 September, revenue grew 7% to £2.3 billion, with underlying revenue up 9.3% and organic recurring revenue growing 11%, which were all in line with the City analyst consensus.
Sage Business Cloud revenue increased 16%, driven by growth in cloud native revenue of 23% mostly from new customer acquisition.
Underlying profit (EBITDA) grew 16% to £622 million, with margin increasing by 160 basis points to 26.6%, which was ahead of forecasts.
CEO Steve Hare said: "Sage has delivered another successful year, achieving strong, broad-based revenue growth together with significantly higher profits and cash flows. We also invested further in our products and continued to execute well against our strategic priorities."
A final dividend of 13.5p was proposed, increasing the total payout for the year by 6% to 20.45p, with the share buyback "reflecting Sage's strong cash generation, robust financial position, and the board's confidence in Sage's future prospects", the company said.
On the outlook, Hare sees the company entering its 2025 financial year with "good momentum" and expects organic total revenue growth to be 9% or above, while operating margins are expected to "trend upwards in FY25 and beyond".