Sage wields axe in N. America as sales disappoint

By Mark Potter and Dan Lalor

LONDON (Reuters) - The country's biggest software firm, Sage Group (SGE.L), reported slower-than-expected growth at its North American business on Thursday and said top managers at the division were leaving with immediate effect.

Shares in the Newcastle-based accounting and sales software specialist fell over 2 percent in early trade.

Sage, which has around 5.4 million mostly small business customers, said results for the year ended September 30 would be in line with analysts' expectations, with earnings before interest, tax and amortisation (EBITA) up 18 percent.

But revenues in North America -- almost half of the total -- were up just 4 percent excluding acquisitions, down from 6 percent the year before and below the group total of 7 percent.

"We had expected better growth in the second half of the year (in North America)," Finance Director Paul Harrison told reporters.

Sage declined to comment on why the division had fallen short of its hopes, but said the competitive landscape had not changed significantly and that Ron Verni and Jim Eckstaedt, the chief executive and finance director of its North American unit, respectively, had left the company with immediate effect.

Group Chief Executive Paul Walker said that, after a reorganisation of the North American business into four operating units in May, the company was looking for new leaders with experience of running a divisionalised business rather than people used to day-to-day management.

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