Peachtree 2008 Annual Report Download

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Results for the year ended
30 September 2008

Table of contents

  • Page 1
    Results for the year ended 30 September 2008

  • Page 2
    ..., including Sage Healthcare Division • UK business performed well in deteriorating market conditions - Growth sustained in key product lines - Customer support revenues remained strong • Strong full year performance in Mainland Europe and Rest of World - Good management execution combined with...

  • Page 3
    ... highlights Year ended 30 September 2008 Revenue Adjusted pre-tax profit^ Adjusted earnings per share^ Operating cash flow/EBITA†Dividend per share £1,295.0m £273.4m 14.44p 114% 7.21p y y y 7%* 3% 3% y 3% *At constant exchange rates ^Stated prior to amortisation of intangible fixed assets...

  • Page 4
    Subscription revenues underpin growth and cash flow (excluding Sage Healthcare Division) Organic revenue growth £400m Cash flow £800m £700m £600m £500m £400m £300m £200m £100m £0m Softwa re a nd s oftwa re ‐ rel a ted s ervi ces ...

  • Page 5
    Financial review

  • Page 6
    ...% excl Sage Healthcare Division Software and software-related services Licence, Training Professional services Business forms, Hardware +6% +2% 41% 714 786 59% 61% Subscription revenues Combined software/support contracts Maintenance and support Transaction revenues Hosted products +9% FY07...

  • Page 7
    ... North America investment in support • 2 - South Africa investment in infrastructure 25% 1 24% 2 3 4 5 23% - Driving down cost base • 3 - North America (Sage Healthcare Division) • 4 - France 22% 21% - Recent acquisitions • 5 - Early dilutive impact 20% FY07 NA SA SHD France UK Organic...

  • Page 8
    ...from operations Interest Tax Net capex 342.0 (25.7) (62.5) (38.6) Net debt 1 October 2007 Free cash flow Acquisitions Dividends FX translation Other (509.7) 215.2 (81.1) (106.2) (66.1) 6.9 (541.0) Free cash flow 215.2 Net debt 30 September 2008 Cash:profit conversion 114% Interest cover 10...

  • Page 9
    ...Property, plant and equipment Net deferred tax Net working capital Deferred income Tax liabilities Sept 2008 2,049.2 140.5 (21.6) 47.8 (352.2) (69.2) (3.9) (2.6) 1,788.0 ...expiring 2011 - £100m expiring 2010 • Deferred income growing - Tied to underlying subscription revenue - Provides future ...

  • Page 10
    Regional review

  • Page 11
    Organic revenue growth H1 vs H2 (excluding Sage Healthcare Division) 20% 15% 15% 13% 10% 9% 5% 3% 1% 1% -2% 14% 10% 8% 5% 8% 6% 4% 5% 0% UK -5% Mainland Europe North America* Rest of World Group* H108 H208 FY08 At constant exchange rates * Excluding Sage Healthcare Division 11

  • Page 12
    ... 3% organic revenue growth - Sage 50 continued to deliver strong growth - Payroll growth modest in absence of legislation change - Premium support and combined contracts continued strong growth £240m £200m £160m £246m £224m £120m • 2 acquisitions completed in the year for an EV of £40m...

  • Page 13
    ...excellent performance - Good execution by experienced management team - Strong performance across product portfolio with innovation in premium support 30% 25% 21% 20% 15% 10% 5% 0% -5% 9% 7% 5% 8% 19% 18% 14% Organic revenue growth 30% 25% • Spain strong growth in migrations and customer support...

  • Page 14
    ... Business Management Division flat - Peachtree flat overall for the year however H2 growth from migrations to Quantum - Both MAS and Peachtree affected by market conditions • Industry & Specialised Solutions Division +3% - Construction solutions driven by growth in support - Non Profit Solutions...

  • Page 15
    ... revenues - South Africa - Australia +20% +9% £100m £90m £80m £70m £60m £50m £40m £30m £79m £91m • Strong growth in both licence and support contracts • EBITA margin 26% (FY07: 26%) £20m £10m £0m 26% margin 26% margin FY07 Revenue FY08 EBITA At constant exchange rates 15

  • Page 16
    Business review and outlook

  • Page 17
    ...-level customers delaying migration to mid-market solutions • SMEs continue to need our products to run their businesses - Need to find efficiencies in running their businesses - Government initiatives creating more demand for up to date business management software and quality support - Quality...

  • Page 18
    ... million customers - Increase of 341,000 over the year - Geographically diverse - Rely on Sage as a business partner • Robust routes to market - Direct (constitutes majority of our revenues) - Business partners - Accountants - Business and financial advisors • Management teams with experience...

  • Page 19
    Customer support underpins our business • Maintenance and support revenue = 52% of total revenues Support only Contracts 0.6m Revenue £165m 1.7m Combined software /support contracts Contracts 1.1m contracts Revenue £508m £673m 19

  • Page 20
    ... software/support contracts - tiered offerings Support Tier 1 Telephone hotline assistance / e-mail support As above + 1 hour response time As above + dedicated support people / no call wait time Maintenance Software upgrade Other Discounts on training As above + on-line training + on-line...

  • Page 21
    ... organisational review • Review of product and services portfolio on-going - Optimise market positioning and customer targeting • Move to combined software/support model for Simply, Peachtree • Integrated product suite strategy launched this year - Extended Enterprise Solutions 21

  • Page 22
    ... healthcare sector - Excellent organisational and execution skills • Focus on operational efficiencies over the next year - Sales team efficiencies - Rationalisation of ancillary operations - Leverage distribution opportunities • Network services and customer support both stabilised • Market...

  • Page 23
    Outlook • Business model resilient - Subscription revenues continue to offset weakness in software revenues - Cash flow remains strong - Robust balance sheet with committed financing • Customer base of over 5m remains our competitive advantage - Market leader in most of our global markets - ...

  • Page 24
    Supplementary information

  • Page 25
    ... growth incl Sage Healthcare Division +3%* 509 500 41% 39% Software and software-related services Licence, Training Professional services Business forms, Hardware Subscription revenues Combined software/support contracts Maintenance and support Transaction revenues Hosted products -2%* 714...

  • Page 26
    UK Revenues Subscription Software and software-related services Total Profit EBITA EBITA margin £88.5m 36% £160.5m £85.2m £245.7m Customers* New customers Total customers 31,000 772,000 Support contracts New support contracts Total support contracts * Excluding ACT! 363,000

  • Page 27
    Mainland Europe Revenues Subscription Software and software-related services Total Profit EBITA EBITA margin £100.2m 22% £237.4m £219.9m £457.3m Customers* New customers Total customers 127,000 1,629,000 Support contracts New support contracts Total support contracts * Excluding ACT! 59,000 ...

  • Page 28
    North America Revenues Subscription Software and software-related services Total Profit EBITA EBITA margin £87.7m 18% £351.3m £149.6m £500.9m Customers* New customers Total customers 124,000 2,995,000 Support contracts New support contracts Total support contracts * Excluding ACT! 3,000 601,...

  • Page 29
    ... American operating divisions Small Business and Mid-Market accounting, ERP, CRM Business Management Division 47% FY08 revenue Industry-specific solutions and human resource management Industry & Specialised Solutions Division 16% FY08 revenue Emdeon Practice Services Sage Healthcare Division...

  • Page 30
    Rest of World Revenues Subscription Software and software-related services Total Profit EBITA EBITA margin £23.4m 26% £36.5m £54.6m £91.1m Customers* New customers Total customers 59,000 501,000 Support contracts New support contracts Total support contracts * Excluding ACT! 35,000 154,000