Hare said today he was “focused on growing the business in absolute terms, both organically and through acquisitions” after three years of “slimming down” the company.
Hare launched a turnaround at Sage when he took over in 2018. He has sold off parts of the business worth £500 million since then but today said disposals were over as Sage now gears up to grow again.
“The focus going forward now is to scale the business,” he told the Standard. Sage is forecasting revenue growth of 8% to 9% for next year before the impact of any deals.
Sage today reported a squeeze on annual profits due to increased investment. Operating profits for the year to 30 September dropped 8% to £373 million and revenue dipped 3% to £1.85 billion.
The squeeze on profits came as Sage invested more in tech to give it a platform for growth. Hare said Sage’s R&D spending has risen by 50% during his time in charge. That cash has gone towards “enhancing the product,” he said.
Sage builds accounting, invoicing and payroll software for small and medium sized businesses. It handles 10 billion invoices a year and claims to do payroll for 25% of Britain’s salaries employees.
Hare said there was “a lot of opportunity” for Sage as small business bounce back from the pandemic and go digital, but admitted there were “one or two headwinds.”
“Every single customer I speak to says it’s taking longer to hire. The second thing is there are some hiccups in the supply chain. I saw speaking with a builder the other day. Just getting timber, steel - there are longer lead times and it’s more expensive than it was.”
Hare said Sage was facing the same hiring pressures, with “a lot of competition” for software engineers, data scientists and AI specialists. But he said: “We have what we need to drive growth over the next few years.”
Shares rose 12.5p to 741.5p.