Africa was the best-performing region for multinational enterprise software company Sage Group for the six months ended 31 March.
The group posted improved organic revenue growth of 6.2% (H1 2015: 5%), achieving double-digit recurring revenue growth of 10% (H1 2015: 8.1%). It also reported accelerated software subscription growth of 35.3% (H1 2015: 25.4%) in line with the planned transition and corresponding decline in SQL server reporting services revenue of 6.3% (H1 2015: -2%).
In its first half results, Sage says organic revenue of £44 million for Africa represents sustained organic growth of 17% (H1 2015: 16%), supported by strong recurring revenue growth of 26% (H1 2015: 17%).
Growth is being achieved by both Sage X3 and local growth products, the company notes, adding strong regional leadership is being developed to grow the African business more quickly outside of SA.
Anton van Heerden, executive VP and MD of Sage South and Southern Africa, says as far as the African market share (excluding SA) is concerned, the growth has been strong because the company came off a fairly low base.
"This allows for greater growth potential. The African market is also a lot less saturated than the South African market, which means the opportunity to convert businesses to automated accounting and payroll systems is bigger. We have seen strong growth of our Sage X3 Business Management Solution in the African market," says Van Heerden.
He points out the company is "very happy with South Africa's performance, especially with the growth in recurring revenues".
To support the company's growing business partner network in Nigeria and Kenya, Sage will grow its infrastructure in these regions, says Van Heerden. In addition, Sage will continue to invest in localising its technology to further meet and comply with the local requirements in these areas.
According to Van Heerden, Africa's greatest growth opportunity is the implementation of cloud solutions. He points out the availability of bandwidth in Africa is increasingly more reliable, making cloud solutions a more compelling alternative.
"We have a large business partner network that spans the continent, reselling our solutions and providing consulting and implementation services to our clients. Sage's offices in East Africa (Nairobi, Kenya) and West Africa (Lagos, Nigeria) provide local support to our business partners and customers in these areas. Business partners and customers in the southern countries are all supported from our Gauteng offices."
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