The result was in line with market expectations, which were sharply lowered last July after Sage warned that it had been hit by delays in launching new products, and distribution problems at DacEasy, its US subsidiary.
The profits warning led to a collapse in the shares from an all- time peak of 619p amid fears that Sage's growth had run into the buffers. But the results sent City analysts scurrying back to upgrade their pre-tax profit forecasts for this year by pounds 1.5m to pounds 12.5m.
Sage said that it had overcome both problems and trading trends indicated 'continuing growth and an improvement in profitability this year'.
David Goldman will hand over the chief executive's title to Paul Walker in January but will continue as group chairman.
Earnings per share improved from 30.9p to 32.5p. A final dividend of 6.6p lifts the total by 10 per cent to 9.92p. The group's net cash rose from pounds 4.2m to pounds 5.8m.