The Sage Group Plc an Introduction

Home , Donald Brydon, Sage Group, Steve Hare (businessman)

An introduction

February 2016 What we do Sage is the market leader for integrated accounting, payroll and payment systems, supporting the ambition of the world’s entrepreneurs.

Sage began as a small business in the UK 35 years ago and over 13000 colleagues now support millions of entrepreneurs across 23 countries as they power the global economy. We reinvent and simplify business accounting through brilliant technology, working with a thriving community of entrepreneurs, business owners, tradespeople, accountants, partners and developers. And as a FTSE 100 business, we are active in supporting our local communities and invest in making a real difference through the philanthropy of the Sage Foundation.

The Sage Group plc - an introduction 2 Key facts about our organization

Market Finances Customers

Global company with over Revenue of 13,000 £1.4bn 3m employees

• One of the market leaders • Organic revenue growth of • Supporting customers, in the UK, North America, 6% for 2015 (2014: 5%)* managing over 30,000 calls Europe, South Africa, Asia • Organic operating profit each day and Brazil £380m* • Ecosystem including 100,000 • Local presence in 23 • Market capitalization of c. accountants globally countries globally £6bn

The Sage Group plc - an introduction * Data for financial year ending 30 September 2015 3 How we started

1981 2005 2015 Entered the Polish market Sage founded in Newcastle Launch of upon Tyne by David Goldman, 1989 Sage Live Paul Muller and Graham Wylie 1999 2008 Listed on the London Stock and Sage Became FTSE 100 Launch of Sage ERP X3 Exchange Impact …………………….. Entered the 2010 1991 Portuguese and Guy Berruyer Entered the US market Swiss markets became CEO 1981 - 1982 - 1983 - 1984 - 1985 - 1986 - 1987 - 1988 - 1989 - 1990 - 1991 - 1992 - 1993 - 1994 - 1995 - 1996 - 1997 - 1998 - 1999 - 2000 - 2001 - 2002 - 2003 - 2004 - 2005 - 2006 - 2007 - 2008 - 2009 - 2010 - - 2011 2012 - 2013 - 2014 - 2015 -

2014 1994 2007 Stephen Kelly joins Paul Walker appointed Tony Hobson Sage as CEO Chief Executive became Chairman of 2012 the board Entered the Brazilian market 1992 ………………………………… Entered the French market Donald Brydon became 2003 Chairman of the board Entered 7 new markets …………………….. Graham Wylie retired 2011 Launch of Sage One

The Sage Group plc - an introduction 4 Our three strategic regions

North America Europe • US and Canada • UK & Ireland, France, Spain, • Strong presence in small Germany, Switzerland, business, a market leader Poland, Portugal, Austria, in Canada Belgium and a subsidiary in • c.2,200 employees* Morocco • One of the market leaders in • Revenue of £477 million* the UK, France, Ireland, International Spain, Switzerland and Poland • Brazil, Africa (primarily South Africa), • c.7,200 employees* Australia, Middle East and Asia (primarily • Revenue of £753 million* Singapore, Malaysia and UAE) • One of the market leaders in South Africa, Australia and Malaysia • c.3,600 employees* • Revenue of £206 million*

The Sage Group plc - an introduction * Data for financial year ending September 2015 5 Our values

Customers first Velocity Do the right thing Innovate Make a difference

Our customers are at We are agile and action Our colleagues are aligned We create new ways of Sage is a great place to work the heart of everything we orientated; we keep things and we trust each other to do doing things and deliver and our colleagues make a do, they are why we are simple, deliver at pace and the right thing to enable our innovative solutions which our positive difference to local here and we wouldn’t exist over achieve. customers to succeed. customers need to help their communities by relentlessly without them. businesses grow. supporting our customers and their businesses to be successful.

The Sage Group plc - an introduction 6 Our software & support

Millions of the world’s small and medium businesses trust us to help turn their dream business ideas into a way of life.

We are giving our customers the power to control their businesses from the palm of their hands, using the smartest technology to reinvent and simplify business accounting. We enable our customers to focus on their business and help them to leapfrog to the future.

We help our customers navigate the intricacies of business accounting by answering over 30,000 queries a day, by offering legislative guidance to all customers and by championing the causes that matter to them.

The Sage Group plc - an introduction 7 Market opportunity

Population 72 million businesses in our existing geographies

Characteristics

0-9 employees 10-199 employees 200+ employees 68m 4m 150k

Opportunity It is estimated that only one in ten small and medium businesses are using a packaged solution to run their business. The remaining businesses represent the white space.

The Sage Group plc - an introduction 8 Our product focus

The golden triangle: • A strong value proposition we can provide to our customers in three mission critical areas—accounting, payroll and HR, and payments • We are focused on ensuring our solutions can be seamlessly integrated to The automate workflow and the movement of golden triangle money

The Sage Group plc - an introduction 9 Portfolio of Growth Products

Mid Market Sage X3

Sage 100 Sage 200 Small & Sage 300 Murano Sage Live Medium Evolution Office Line Symfonia …

Sage 50 Micro & Ciel Conta Plus Small Pastel Sage One Folhamatic …

The Sage Group plc - an introduction Excluding Payments as this is a vertical activity that runs throughout. 10 Our strategic pillars

Customers One Sage Winning in Capacity Revolutionize for life the market for growth business

Regardless of product, location, We’ll be one inclusive team of Our ambition is to be the Sage will be structured to best We will not only meet our and size we’re passionate smart experts executing at pace market leader: creating value serve our customers: removing customers’ needs, we’ll change about our customers and want and taking pride in putting our for customers, developing duplication of effort, simplifying the game completely. The Sage to serve them for life. customers first and foremost. innovative products, thriving in processes, and working as one ecosystem will be business’ unchartered territory. team. indispensable ally and the go-to source for advice.

The Sage Group plc - an introduction 11 Business model Activate

Attract new customers Heavily informed by our strategy, Develop deeper customer by winning in the market, relationships by bringing offering customer choice, the customer is at the start, middle the latest technology supporting a strong partner and other benefits and accountant ecosystem and end of the business model— of subscription to and providing first inactive customers. aligned with the customer lifecycle class support. and experience. Attract Our customer Grow with our journey customers by Create exceptional revolutionizing customer experiences business, providing to earn customers for life. additional features and The lifecycle is supported services. Identify when a Grow by our One Sage culture customer would benefit from and capacity for growth. migrating up to the next product solution.

Retain

The Sage Group plc - an introduction 12 Our ecosystem

We work with a thriving community of We work with a global network of around 20,000 accountants, partners, developers business partners who provide: and entrepreneurs, the engine room of • Implementation and customisation economies around the world. • Training and support

• Specialist sector knowledge Business partners are key not only in selling our software and services, but also Plus more than 48,500 accountants who belong to a in providing local expertise to customers Sage recommendation scheme and small business who demand increasing levels of tailored advisors who market and recommend Sage products software and specialized services. worldwide.

Recent partnerships include Microsoft, Salesforce, In November 2015, we launched our Global Partner pwc and Deloitte. Hundreds of partners helped co- Program to promote partner growth, and simplify our create our cloud-based Sage Live product, which, partner ecosystem into a four-tier model. with their help, was developed in just 26 weeks.

The Sage Group plc - an introduction 13 Colleagues

We are trusted by millions because we always put customers first and work collaboratively to create the best customer solutions.

All of our colleagues are guided by the five principles and values which we share, which shape how we think, plan and make decisions to deliver operational excellence and best serve our customers.

Our colleagues are empowered to give to the causes that matter to them through the Sage Foundation, to ensure that our company makes a real difference to our local communities.

The Sage Group plc - an introduction 14 Our executive committee

Stephen Kelly Sandra Campopiano Brendan Flattery Ivan Epstein Anna Campopiano Chief Executive Officer Chief People Officer President, Europe Chief Executive Officer, Chief Communications Sage International Officer (Interim)

Steve Hare Michael Robinson Klaus-Michael Santiago Solanas Marc Scheipe Gary Daniels Chief Financial Officer Company Secretary Vogelberg Group Chief Marketing President & CFO for Sage EVP – Global Product and Group Legal Director Group Chief Technology Officer North America (Interim) Delivery Officer

The Sage Group plc - an introduction 15 The Sage Foundation

The Sage Foundation has been set up to consolidate all the great philanthropic work we already do across the world; to formalize our approach to corporate philanthropy and to increase the impact we have.

Using a unique 2+2+2 model, we aim to help colleagues and organizations to create a positive impact on society by giving our time, money, expertise and technology. We will focus on creating social and economic opportunity in the communities in which we operate.

2% of employee time 2% of free cash flow 2 donated product licenses

The Sage Group plc - an introduction 16 We all work together to deliver…

Extraordinary Customer Experiences Awards

• Nearly 5,000 customer support staff UK: Winner of Financial Software Vendor of the Year globally 2015 at UK FD Excellence Awards • Two new Customer Business Centers in South Africa: Winner of Best Help Desk in the world Atlanta and Dublin to revolutionize the at the Contact Centre World Top Ranking Performer way we attract and support customers global finals 2013 • Over 30,000 calls per day for technical North America: Winner for Best New Cloud Products at K2 Quality Awards 2015 support, accounting questions and North America: Winner for Sage Advisor: advice on new legislation Personalizing the Customer Experience CXPA - Customer Experience Innovation Awards 2013 Spain: Madrid Regional Government: Madrid Excellence Award for Consumer Confidence 2013 Germany: Winner of the Cloud Leader award 2015, EXPERTON The Sage Group plc - an introduction 18 In conclusion

We are giving customers the power to control their businesses from the palm of their hand. We are changing the way that millions of businesses around the world track the movement of money through their business and helping them turn their dream business ideas into a way of life.

The Sage Group plc - an introduction 19 Thank you.

The Sage Group plc North Park Newcastle upon Tyne NE13 9AA www.sage.com