QSC AG
Company Presentation
Results Q1 2009
1
Cologne, May 13, 2009
AGENDA
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- Operational Update Dr. Bernd Schlobohm, Chief Executive Officer
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- Financial Results Jürgen Hermann, Chief Financial Officer
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- Outlook Dr. Bernd Schlobohm, Chief Executive Officer
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- Questions & Answers
MAJOR ACHIEVEMENTS IN Q1 2009
- •Ongoing profitable revenue growth despite deep recession
- • Highly cost-efficient NGN enables QSC to grow in
- •Voice business with enterprise customers
- •Voice wholesale business
- •Increased focus on cost discipline and working capital improvement
- •Focus on high-margin products and services is paying off
- •IPfonie centraflex wins IT INNOVATION AWARD at CeBIT 2009
- •Two new board members: Joachim Trickl and Jürgen Hermann
FINANCIAL OVERVIEW FOR Q1 2009
- • Free cash flow of €4.0 million(Q1 2008: €-10.2 million)
- • Net profit of €1.4 million(Q1 2008: €-4.1 million)
- • EBITDA up 71% to €19.5 million (Q1 2008: €11.4 million)
- • Revenues up 10% to €107.6 million (Q1 2008: €97.5 million)
- • Significant reduction in CAPEX to €11.5 million(Q1 2008: €28.6 million)
- ⇒Good start to 2009 thanks to positive development in all 3 segments
4
BU WHOLESALE/RESELLERSGROWTH IN VOICE AND SHDSL BUSINESS
Break-up of revenues
- •47% of segment revenues from ADSL2+
- • 30% of segment revenues fromvoice wholesale
Major developments
- • NGN enables QSC to be a front runner in voice wholesale business
- • Growing demand among cable operators for voice services
- • SHDSL wholesale for carriers on stable growth course
- • ADSL2+ wholesale is growing moderately, fierce price competition
5
BU WHOLESALE/RESELLERADSL2+ GROWTH IS SLOWING DOWN
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BU PRODUCTSDIRECT ACCESS BUSINESS IS STABILIZING REVENUES
- Same level of revenues as in Q2,
- Growing demand for direct access
- QSC stopped actively marketingits remaining residential product,
7
BU MANAGED SERVICES ONGOING GROWTH IN DIFFICULT ENVIRONMENT
Major developments
- • In recession, it is taking somewhat longer to turn an initial contact into an order
- • 70% of new business stems from existing customers
- •New customer: ADAC in April 2009
- • Growth opportunity: Integration of VoIP in IP-VPN solutions
- • Growing demand for Managed and Hosted Services (Telco-Softwareas-a-Service)
AGENDA
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- Operational Update Dr. Bernd Schlobohm, Chief Executive Officer
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- Financial ResultsJürgen Hermann, Chief Financial Officer
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- Outlook Dr. Bernd Schlobohm, Chief Executive Officer
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- Questions & Answers
QSC STAYS ON GROWTH COURSE
FOCUS ON HIGHER-MARGIN PRODUCTS AND SERVICES IS PAYING OFF
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(1) Excluding depreciation and non-cash share-based payments
EFFICIENCY GAINS IN SELLING AND MARKETING
Drivers
- • QSC swiftly achieved synergies following the Broadnet merger
- •Strict cost discipline
12
VERY POSITIVE DEVELOPMENT OF EBITDA MARGIN
ALL 3 SEGMENTS ARE CONTRIBUTING TO PROFITS
14
QSC IS EARNING A SUSTAINABLE NET PROFIT
LOW AND STABLE LEVEL OF CAPEX IN 2009
SIGNIFICANT POSITIVE FREE CASH FLOW
QSC STRENGTHENED FINANCIAL POSITION IN Q1 2009
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AGENDA
-
- Operational Update Dr. Bernd Schlobohm, Chief Executive Officer
-
- Financial Results Jürgen Hermann, Chief Financial Officer
-
- Outlook Dr. Bernd Schlobohm, Chief Executive Officer
-
- Questions & Answers
OUTLOOK 2009POSITIVE DEVELOPMENT DESPITE RECESSION
- •Recession: Gloomy economic outlook for Germany
- •Growth in most market segments of relevance to QSC
- • Efficiency gains based on our services portfolio should provide relatively good insulation from the recessionary environment
- • QSC will concentrate on positive Free Cash Flow and Profitability
- •Sharpened focus on profitable revenues
- •More focused market segmentation ("what to sell & what not to sell")
- •Greater focus on the most profitable revenues
- •Further automatization
- •Strict cost discipline
OUTLOOK 2009QSC REITERATES GUIDANCE
- •Focus 2009: Improvement of cash flow and earnings
- •Free Cash Flow > €10 million
- •EBITDA of between €68–€78 million
- •Sustainable positive net income
- • Revenues of between €420–€440 million with improved quality of revenues
- •Further growth in Wholesale, especially Voice Wholesale
- •Stabilization of Products
- •Greater focus on and further growth in Managed Services
OUTLOOK 2009QSC IS MOVING UP THE VALUE CHAIN
AGENDA
-
- Operational Update Dr. Bernd Schlobohm, Chief Executive Officer
-
- Financial ResultsJürgen Hermann, Chief Financial Officer
-
- Outlook Dr. Bernd Schlobohm, Chief Executive Officer
- 4.Questions & Answers
FINANCIAL CALENDAR 2009
May 20, 2009 Annual Shareholders Meeting
- June 24, 2009 German & Austrian Corporate Conference Deutsche Bank, Frankfurt
- August 12, 2009 Publication of Quarterly Report II/2009
- August 25, 2009 9th German Technology & Telecoms Conference Commerzbank, Frankfurt
- November 9–11, 2009 German Equity Forum Fall 2009 Deutsche Börse, Frankfurt
November 12, 2009 Publication of Quarterly Report III/2009
CONTACT
QSC AGArne ThullHead of Investor RelationsMathias-Brüggen-Strasse 55 50829 CologneGermany
Phone +49-(0)221-6698-724 Fax +49-(0)221-6698-009 E-mail [email protected] Web www.qsc.de
SAFE HARBOR STATEMENT
This presentation includes forward-looking statements as such term is defined in the U.S. Private Securities Litigation Act of 1995. These forward-looking statements are based on management's current expectations and projections of future events and are subject to risks and uncertainties. Many factors could cause actual results to vary materially from future results expressed or implied by such forward-looking statements, including, but not limited to, changes in the competitive environment, changes in the rate of development and expansion of the technical capabilities of DSL technology, changes in prices of DSL technology and market share of our competitors, changes in the rate of development and expansion of alternative broadband technologies and changes in prices of such alternative broadband technologies, changes in government regulation, legal precedents or court decisions relating, among other things, to line sharing, rent for colocation and unbundled local loops, the pricing and timely availability of leased lines, and other matters that might have an effect on our business, the timely development of value-added services, our ability to maintain and expand current marketing and distribution agreements and enter into new marketing and distribution agreements, our ability to receive additional financing if management planning targets are not met, the timely and complete payment of outstanding receivables from our distribution partners and resellers of QSC services and products, as well as the availability of sufficiently qualified employees.
A complete list of the risks, uncertainties and other factors facing us can be found in our public reports and filings with the U.S. Securities and Exchange Commission.
DISCLAIMER
- • This document has been produced by QSC AG (the "Company") and is furnished to you solely for your information and may not be reproduced or redistributed, in whole or in part, to any other person
- • No representation or warranty (express or implied) is made as to, and no reliance should be placed on, the fairness, accuracy or completeness of the information contained herein and, accordingly, none of the Company or any of its parent or subsidiary undertakings or any of such person's officers or employees accepts any liability whatsoever arising directly or indirectly from the use of this document
- • The information contained in this document does not constitute or form a part of, and should not be construed as, an offer of securities for sale or invitation to subscribe for or purchase any securities and neither this document nor any information contained herein shall form the basis of, or be relied on in connection with, any offer of securities for sale or commitment whatsoever
STABLE SHAREHOLDER STRUCTURE SINCE IPO
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