QSC back in the black
- QSC generates consolidated net income of € 0.6 million
- EBITDA rises to € 10.5 million despite lower revenues
- Focus on forward-looking business fields pays off
- Free cash flow improves to € 3.6 million
Cologne, 8 May 2017. With consolidated net income of € 0.6 million, the Cloud and ICT provider QSC returned to profitability in the first quarter of 2017. With revenues of € 88.7 million, as against € 98.9 million one year earlier, this digitiser to the German SME sector improved its EBIT by € 2.0 million to € 2.6 million and EBITDA by € 0.8 million to € 10.5 million. The EBITDA margin rose by 2 percentage points to 12%. QSC benefited in particular by focusing on its forward-looking business fields of Cloud, Consulting and TC for corporate customers, as well as from its leaner cost base. Together with moderate capital expenditure, QSC’s greater earnings strength led its free cash flow to improve substantially from € -0.8 million in the first quarter of the previous year to € 3.6 million in the first quarter of 2017.
Cloud revenues surge by 117%
Compared with the previous year, Cloud revenues rose by 117% to € 5.2 million in the first quarter of 2017. QSC also achieved revenue growth in Consulting (+7%) and in its TC business with corporate customers (+3%). As expected, revenues fell significantly short of the previous year’s figures in traditional Outsourcing (-17%) and conventional TC business with resellers (-28%). Stricter regulation alone will reduce TC revenues with resellers by almost € 4 million per quarter in 2017.
QSC confirms forecast for 2017
In the quarters ahead, QSC will continue to focus on those business fields in which it expects to generate growth in future – and here above all on the Cloud segment, as well as on Consulting and its TC business with corporate customers. Overall, QSC expects to generate revenues of between € 355 million and € 365 million in the current financial year, as further reductions in revenues in the TC business with resellers and the traditional Outsourcing business are expected in the coming quarters as well. Irrespective of this development, the Company expects to generate EBITDA of between € 36 million and € 40 million and free cash flow ahead of the previous year’s figure of € 8.4 million.
Comments QSC’s CEO, Jürgen Hermann: “Positioning ourselves as the digitiser to the SME sector and our reorganisation are paying off. We are growing in those areas where we aim to achieve growth and thus boosting our earnings and financial strength.”
|€ million||Q1 2017||Q1 2016||Change|
|Cloud revenues||5.2||2.4||+116.7 %|
|Consulting revenues||10.7||10.0||+7.0 %|
|Outsourcing revenues||26.7||32.1||-16.8 %|
|Telecommunications revenues||46.2||54.4||-15.1 %|
|– of which with resellers||23.2||32.0||-27.5 %|
|– of which with corporate customers||23.0||22.4||+2.7 %|
|Consolidated net income||0.6||-0.1||n/a|
|Free cash flow||3.6||-0.8||na|
|Capital expenditure||4.2||3.6||+16.7 %|
|Number of employees at 31 March||1,355||1,409||-3.8 %|
The complete Quarterly Statement can be downloaded at https://www.qsc.de/en/investor-relations. This Corporate News includes forward-looking statements. These are based on current expectations and forecasts as to future events made by the management of QSC AG. Due to risks or erroneous assumptions, actual results may deviate substantially from these forward-looking statements.
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