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The Sage Group plc | Annual Report & Accounts 2015
114
Results for the year
2 Segment information
This note shows how Group revenue and Group operating profit are split across the three reportable segments in which we operate,
being Europe, North America and International (South America, Africa, Australia, Middle East and Asia).
In May 2015, following the departure of the CEO of Sage Americas there was a change in the reporting segments with the Brazilian
business being moved out of the Americas segment. For reporting purposes Brazil has been combined with AAMEA, to form the new
International segment and the Americas segment was renamed to North America. The 2014 comparatives have been updated to align
with the new segmental reporting.
For each geographical region, revenue and operating profit are compared to prior year in order to understand the movements in the
year. This comparison is provided for statutory, underlying and organic revenue and operating profit.
– Statutory results are the IFRS statutory results.
– Underlying and underlying as reported are non-GAAP measures. Adjustments are made to statutory results to arrive at an underlying
result which is in line with how the business is managed and measured on a day to day basis. Adjustments are made for items that
are individually important in order to understand the financial performance. If included, these items could distort understanding of
the performance for the year and the comparability between periods. See note 3.6 for details of these adjustments.
In addition, the prior year underlying values are translated at current exchange rates, so that exchange rate impacts do not distort
comparisons. Prior year underlying values at prior year exchange rates are “underlying as reported”; prior year and current year values
at current year exchange rates are “underlying”.
– Organic is a non-GAAP measure. The contributions of current and prior year acquisitions and disposals are removed, so that results
can be compared to prior year on a like for like basis.
In addition, the following reconciliations are made in this note.
– Revenue per segment reconciled to the profit for the year as per the income statement.
– Statutory operating profit reconciled to underlying operating profit per segment (detailing the adjustments made).
Accounting policy
In accordance with IFRS 8, “Operating Segments”, information for the Group’s operating segments has been derived using the
information used by the chief operating decision maker. The Group’s Executive Committee has been identified as the chief operating
decision maker in accordance with their designated responsibility for the allocation of resources to operating segments and assessing
their performance, through the Quarterly Business Reviews chaired by the CEO and CFO. The Executive Committee use organic and
underlying data to monitor business performance. Operating segments are reported in a manner which is consistent with the operating
segments produced for internal management reporting.
The Group is organised into four key operating segments, with Brazil being aggregated with AAMEA with which there are similar
economic characteristics to form the International reporting segment. The UK is the home country of the parent. The reporting
segments and their main operating territories are as follows:
– Europe (France, UK & Ireland, Spain, Germany, Switzerland, Poland, Portugal and Sagepay)
– North America (US and Canada)
– International (Brazil, Africa, Australia, Middle East and Asia)
The Africa operations are principally based in South Africa; the Middle East and Asia operations are principally based in Singapore,
Malaysia and UAE.
Segment reporting
The tables below show a segmental analysis of the results for continuing operations.
The revenue analysis in the table below is based on the location of the customer which is not materially different from the location where
the order is received and where the assets are located.
Revenue categories are defined in Note 3.1. Processing revenue has been disclosed separately for year ended 30 September 2015 and the
prior year comparatives have been restated to this effect.