QSC gains further earnings strength in strong quarter
- EBITDA increases to € 10.7 million in second quarter of 2016
- EBIT improves to € 2.0 million
- Consolidated net income positive for first time in eight quarters
- Substantial progress in organisational restructuring
- Cloud revenues more than double
Cologne, 8 August 2016. QSC AG, a provider of cloud and ICT services, can report a positive operating performance once again for the second quarter of its current financial year, with revenue growth in precisely those business fields in which this “digitiser of the German SME sector” expects to generate sustainable growth. At the same time, QSC made faster progress with implementing its cost-cutting programme than initially expected at the beginning of the year. Together with lower depreciation and amortisation, this progress enabled operating earnings (EBIT) to improve to € 2.0 million, as against € -2.2 million in the second quarter of 2015. The Company also generated positive consolidated net income for the first time in eight quarters. This key figure came to € 0.2 million, as against € -2.7 million in the second quarter of 2015.
Free cash flow rises to € 6.3 million
At € 99.2 million, revenues fell only slightly short of the previous year’s figure of € 100.9 million. While Cloud revenues more than doubled to € 4.0 million and revenues in the Consulting segment topped the € 10 million mark for the first time, consistent with expectations revenues declined in the conventional Telecommunications business with resellers and in the traditional Outsourcing business. Despite the overall decline in revenues, EBITDA for the past quarter improved slightly from € 10.6 million in the previous year to € 10.7 million. The free cash flow rose sharply to € 6.3 million, up from € 1.5 million in the second quarter of 2015.
QSC made progress with its cost-cutting programme, and especially its staff downsizing measures. As of 30 June 2016, the Company still had 1,396 employees and was thus approaching its target of around 1,350 employees by the end of 2016.
QSC confirms forecast
After the strong first half of 2016, QSC can confirm the forecast presented at the end of February. In 2016, it expects to generate revenues of € 380 million to € 390 million, EBITDA of € 34 million to € 38 million and a positive free cash flow. As communicated at the beginning of the year, in the second half of the year the Company will also make investments and incur one-off expenses for the expansion in the Pure Enterprise Cloud and the personnel restructuring measures still underway. The organisational restructuring is expected to be completed by the end of the year.
Comments QSC’s CEO, Jürgen Hermann: “QSC can look back on a strong first half of the year, one in which we made the expected progress in numerous areas.” Hermann referred in particular to the development in revenues: “QSC is growing in those areas where our future is to be found.” That was true of the Cloud segment, with its two main fields of Pure Enterprise Cloud and Internet of Things (IoT), and of the Consulting segment and TC business with corporate customers.
|€ million||Q2 2016||Q2 2015||Change|
|Cloud revenues||4.0||1.7||+135.3 %|
|Consulting revenues||10.5||10.0||+5.0 %|
|Outsourcing revenues||31.6||34.7||-8.9 %|
|Telecommunications revenues||53.1||54.5||-2.6 %|
|– of which with resellers||29.8||32.8||-9.1 %|
|– of which with corporate customers||23.3||21.7||+7.4 %|
|Consolidated net income||0.2||-2.7||n.a.|
|Free cash flow||6.3||1.5||+320.0 %|
|Capital expenditure||3.3||3.9||-15.4 %|
|Employees at 30 June||1,396||1,585||-11.9 %|
The complete Half-Year Report 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 results may deviate materially from these forward-looking statements.