Sage PLC's (LON:SGE) profits fell by a third in its latest half-year as the accountancy software group upped marketing to encourage customers to switch to cloud-based services.
Profits dropped by 31% to £190mln in the six months to end-March, 2021, as margins fell and there were fewer disposal gains. Revenues were 4% lower at £937mln though the underlying performance was better.
Organic growth in the first half was 4.4% and over the whole year will be at the top end of its previous 3-5% guidance, Sage said.
Steve Hare, chief executive, added: "Sage performed strongly in the first half against tough comparators, with continued recurring revenue growth and increasing levels of new customer acquisition, principally in cloud-native solutions.
Hare also expressed confidence about the investment in its cloud-based business, saying this will prove itself as the global economy emerges from the pandemic.
"We believe that small and medium-sized businesses will lead the recovery, and I am confident that our strategic investment in Sage Business Cloud will continue to accelerate growth, as customers become stronger and more digitally-enabled."
The half-year dividend rises by 2% to 6.05p.