The multimillionaire co-founder of Sage Group, the only British software company still in the FTSE 100, announced his retirement yesterday at the age of 42.

Graham Wylie has a stake worth £135m in the company he helped set up as a student 22 years ago, but has pledged not to sell any shares "for the foreseeable future".

He will not go short of cash. Last month Mr Wylie pocketed just over £7m by selling almost 5m shares in the company.

It was unclear last night how Mr Wylie intends to spend his retirement when he leaves at the end of May but he is something of a golf fan. He once spent £21,000 at a charity auction in Newcastle on a golf flag signed by Tiger Woods.

Sage was founded in 1981 by Mr Wylie, then a student at Newcastle University, academic Paul Muller, and local printer David Goldman.

Mr Wylie, who received a CBE for services to the software industry, wrote the company's first accountancy software package and went on to become its UK managing director.

Yesterday Sage's finance director, Paul Harrison, said that Mr Wylie told the board about his intention to leave several months ago. "Graham has been with the business for 22 years, which by anyone's standards is a fair stint."

He will be succeeded as head of Sage's UK business by Paul Stobart who has been on the board for seven years.

Mr Harrison said Mr Wylie decided "the right time" for his departure was the release of the company's trading statement yesterday. It showed that profits for the last six months will be 14% up on last year at about £74m.

A strong performance by its British and US businesses helped to offset a weak market in continental Europe.

Sage said it expects to report revenues of £282m for the six months to the end of March, up 4% on the previous year.

News of Sage's strong performance, despite the turbulence in the software market, pushed its shares up 14.5p, or 12%, to 135p, making it the FTSE 100's biggest climber.