Peachtree 2015 Annual Report Download - page 36

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Our strategy applied continued
Liing our eyes to the future
Weanticipate the shape of our business will evolve as we implement our strategy and will remain
focused on generating strong free cash flow supporting our progressive dividendpolicy throughout.
TRANSITION PHASE
Priorities:
– Earn customers for life bymaintaining and enhancing our customer experience through
the transition
– Continue our progressive transition to subscription relationships
– Implement our target global operating model to generate capacity for growth
– Revolutionise business by investing in Global and Local growth products, optimising product
integration and creating seamless migration pathways for growing customers
Revenue mix
Subscription revenue growth is expected to outpace overall recurring revenue growth via
a combination of new and existingcustomers opting for subscription and a corresponding
reduction inrevenue generated by stand alone maintenance and support contracts.SSRS
revenues are expected to decline, but eventually flaen. We expect that there will always be
some demand for SSRS pricing of soware, especially amongst larger customers, as well
asprofessional services and training, which will continue to be a feature of our value proposition.
Revenue growth
We expect to continue to grow organic revenues at around 6%, but will drive the quality of the
growth by delivering more value to customers. The sources of this growth will be execution of the
cross-sell, migration and reactivation initiatives amongst our on-plan and off-plan installed
customer base and growth in new customers.
Organic revenue growth
of at least
6%
Organic operating profit
of at least
27%
Margin
We will see a shi in our spending mix through the transition phase. The implementation of
our global operating model will introduce some savings, for example leveraging our purchasing
powerthrough a newly establishedglobal procurement function. These savings will be reinvested
in other global priorities, such as enhancing our digital presence within the global marketing
function. We therefore expect to maintain an operating margin of at least 27%, it will become
a beer quality margin withgreater efficiency andcapacity for growth.
Recurring
Subscription
Traditional maintenance
and support
Soware and soware
related services
Processing
The Sage Group plc | Annual Report & Accounts 2015
34