DGAP-Adhoc

QSC lowers guidance following weak quarter

QSC AG / Key word(s): Preliminary Results/Profit Warning

16.10.2014 16:30

Dissemination of an Ad hoc announcement according to § 15 WpHG, transmitted
by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

---------------------------------------------------------------------------

QSC lowers guidance following weak quarter

Cologne, October 16, 2014. According to preliminary calculations, QSC's
operating business developed on a weaker note during the past quarter than
had been planned. Revenues totaled EUR 106.6 million, as opposed to EUR
113.8 million for the same quarter the year before. Contrary to
expectations, significant advances in both business with new ICT products
as well as IT Consulting and IT Outsourcing failed to materialize in the
face of a noticeable downturn in the economy following the summer vacation
season.

As a result of revenues that failed to materialize in high-margin lines of
business, preliminary calculations show that EBITDA of EUR 8.8 million in
the third quarter of 2014, too, was down from the previous year's level of
EUR 19.4 million; the year before, the return of a deferred income line
item in the amount of EUR 5.2 million per quarter had had the effect of
increasing profitability. Moreover, profitability was additionally burdened
by an unfavorable revenue mix in the company's largest business unit,
Direct Sales: QSC generated higher revenues here than otherwise customary
through sales of hardware and benefited less than customary from new
orders. Order bookings, themselves, rose sharply in the third quarter of
2014, reaching a total of EUR 55.3 million. According to preliminary
calculations, free cash flow stood at EUR 3.7 million, in contrast to EUR
6.5 million in the third quarter of 2013.

Following the second disappointing quarter in a row, QSC is adjusting its
guidance for the full 2014 fiscal year and is now focusing squarely on a
return to its customary high profitability. QSC anticipates revenues of at
least EUR 430 million and an EBITDA of at least EUR 40 million for the 2014
fiscal year. The full amount of the lower EBITDA will impact free cash
flow, which will now thus amount to at least EUR 6 million. At the same
time, during the fourth quarter of 2014 QSC will also be responding to a
stricter accounts receivable management on the part of major suppliers in
times of an economic downturn; this will produce an additional negative
working capital effect in the amount of some EUR -18 million. Altogether,
this will lead to a negative free cash flow of max. EUR -12 million for the
full 2014 fiscal year. QSC continues to plan to distribute a dividend of at
least 10 cents per share for the full 2014 fiscal year.

With a view to the disappointing second quarter of 2014, the company had
already launched an initial package of measures following the summer
vacation season: QSC is now broadening the "Clarity" program and expects to
see considerable cost savings during the course of fiscal 2015. Plus
several growth measures. To strengthen its core business and innovation
activities, the company is additionally planning to make one or two further
acquisitions over the course of the coming months. When at the end of
January 2015 it announces its initial preliminary numbers for fiscal 2014,
QSC will be offering an outlook for the 2015 fiscal year, including the
effects of a comprehensive package of measures aimed at regaining the
company's customary profitability.

Note:
The 9-month report of QSC AG will be available for download from
www.qsc.de/en/qsc-ag/investor-relations.html as of November 10, 2014. This
ad-hoc release contains forward-looking statements. They are based on
current expectations and predictions of future events by the Management of
QSC AG. Due to the risks of mistaken assumptions, actual results could vary
substantially from those made in such forward-looking statements.

Queries to:
QSC AG
Arne Thull
Head of Investor Relations
Phone: [phone]
Fax: [phone]
E-mail: [e-mail]


16.10.2014 The DGAP Distribution Services include Regulatory Announcements,
Financial/Corporate News and Press Releases.
Media archive at www.dgap-medientreff.de and www.dgap.de

---------------------------------------------------------------------------

Language: English
Company: QSC AG
Mathias-Brüggen-Straße 55
50829 Köln
Germany
Phone: [phone]
Fax: [phone]
E-mail: [e-mail]
Internet: www.qsc.de
ISIN: DE0005137004
WKN: 513700
Indices: TecDAX
Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr
in Berlin, Düsseldorf, Hamburg, Hannover, München, Stuttgart

End of Announcement DGAP News-Service

---------------------------------------------------------------------------