UK's Sage reports strong profit rise as it rolls out AI

LONDON (Reuters) -Britain's Sage reported a 16% rise in underlying operating profit on Wednesday after it grew both its top line and its margin, and said it expected another year of progress as its customers benefit from AI capabilities in its products.

The company, which supplies accountancy and payroll software to small and medium sized businesses, announced a share buyback of up to 300 million pounds ($393 million) and a 7% increase in its dividend, which it said reflected confidence in its prospects.

Chief Executive Steve Hare said the company had deployed its AI-powered Sage Copilot, underpinned by its own domain-specific large language models, to about 150,000 customers.

"I've spoken to customers who've told me that it's saving them 10-12 hours a week of admin, and that's time that they can use to really focus on growing their businesses," he said.

Shares in Sage rose 3.7% in morning deals.

The company reported a 10% rise on an organic basis in annualised recurring revenue to 2.57 billion pounds ($3.37 billion) for the year to end-September, and a 16% rise in underlying profit to 600 million pounds.

($1 = 0.7627 pounds)

($1 = 0.7627 pounds)

(Reporting by Paul Sandle; editing by Sarah Young)