QSC boosts revenues to € 32.3 million in third quarter of 2019
- Cloud and Consulting drive growth
- Financial and earnings position on target
- Full-year forecast for 2019 confirmed
Cologne, 11 November 2019 ― Having sold its telecommunications business as of 30 June 2019, QSC AG is now on a growth course. As already announced on 15 October 2019, growth in Cloud and Consulting, now the two largest segments, led revenues to rise to € 32.3 million in the past quarter. Excluding Plusnet, revenues for the second quarter of 2019 amounted to € 30.1 million. QSC therefore generated quarter-on-quarter growth of 7%*. Cloud revenues from the activities of Cloud Services and IoT rose to € 10.2 million, up 24% on the second quarter of 2019. Consulting revenues grew by 5% to € 10.6 million. The Outsourcing segment generated revenues of € 7.0 million, as against € 7.3 million in the previous quarter, while the Colocation business improved its revenues to € 4.6 million, up from € 4.5 million in the second quarter of 2019.
Sequential growth from quarter to quarter expected
Explains Company CEO Jürgen Hermann: “QSC is growing. The market is convinced by our integrated solution competence and sector expertise.” This is underlined, among other factors, by the new orders of around € 107 million received in the first nine months. Adds Hermann: “We are acquiring new customers from quarter to quarter and expanding our relationships with existing customers.” In view of this, he expects to see sequential growth in the current fourth quarter of 2019 and beyond. The Company has budgeted revenues of around € 33 million for the fourth quarter of 2019.
QSC’s earnings and financial position also developed on budget in the first quarter since the Plusnet sale. EBITDA for the third quarter of 2019 stood at € -2.2 million. Depreciation and amortisation totalled € 4.1 million, of which € 1.2 million on right-of-use assets for leases recognised under IFRS 16. Operating earnings (EBIT) amounted to € -6.3 million. Due to positive tax effects resulting from the Plusnet transaction, consolidated net income for the third quarter of 2019 amounted to € -2.6 million. As expected, the free cash flow came to € -11.8 million. This was due to the inclusion of one-off payments of € 8.8 million for transaction and consulting expenses, among other items, in the wake of the Plusnet sale and as a result of performance-based commission payments.
Given its business performance, which was on target, QSC can confirm its full-year forecast for 2019. According to this, which includes Plusnet contributions for the first half of 2019, the Company expects to generate revenues of more than € 235 million, EBITDA of more than € 140 million and free cash flow of more than € 130 million. At the end of the first nine months, revenues stood at € 204.9 million, EBITDA at € 143.6 million and the free cash flow at € 140.2 million.
Key figures for the third quarter of 2019 – the first quarter after the sale of the TC subsidiary Plusnet*
|€ million||Q3 2019|
|Consolidated net income||-2.6|
|Free cash flow||-11.8|
|Employees as of 30 September||896|
* In presenting revenues, this Corporate News, like the underlying Quarterly Statement, focuses on comparing the second quarter with the third quarter of 2019 and does not consider the revenues generated by Plusnet through to 30 June 2019. Comparison of total revenues – or with the previous year’s figures – would cloud any understanding of the current operating business performance. The TC business pooled at Plusnet traditionally accounted for well over half of QSC’s revenues and costs. This being so, we have also not provided any year-on-year comparison of the cost and earnings figures in this Corporate News or the Quarterly Statement. All disclosures are presented in the Quarterly Statement, which can be downloaded at www.qsc.de/en/investor-relations.
This Corporate News contains forward-looking statements that are based on current expectations and forecasts on the part of the management of QSC AG with regard to future events. Due to risks or erroneous assumptions, actual events may deviate materially from these forward-looking statements.
About QSC AG
QSC AG is digitalising the German SME sector and enabling its customers to enhance their business processes and business models with the utmost flexibility and efficiency. QSC has longstanding technological and application expertise in the fields of Cloud and Colocation, SAP and the Internet of Things. Its extensive service portfolio provides exactly what SME players need as they move into the digital age: from standardised pay-as-you-use services through to individualised full-range solutions for the retail, manufacturing and energy sectors. All services offer end-to-end quality and high security. QSC bases its relationships with customers on an entrepreneurial approach, a service-driven mindset and a desire to forge mutually beneficial partnerships.
QSC AG is based in Cologne and has around 900 employees at locations throughout Germany.
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