SQS Software Quality Systems AG Regulatory News (SQS)

28 May 2008 07:00

AGM trading update

SQS Software Quality Systems AG (AIM: SQS.L) ("SQS" or the "Company"), the global leader in independent software testing and quality-management services, will hold its Annual General Meeting at 10.00 (09.00 UK time) this morning in Cologne. At the AGM, the Company will give shareholders the following update on trading: 

SQS is pleased to announce continued strong trading in the year to 31 December 2008, comfortably in line with management expectations and despite the adverse currency impact of the recent decline in the value of Sterling1. Demand for SQS services remains robust in all vertical markets, including financial services, as evidenced by the recent signing of a long-term contract with Anglo Irish Bank (announced 27 May 2008). The Company has not seen a slowdown as a result of current economic conditions, perhaps reflecting the importance of independent software testing.

In line with our strategic goal to diversify into new vertical markets, we are pleased to announce the win of clients in three new vertical markets - chemicals, gaming and the food & beverage industry - in addition to the ten verticals already served by SQS. 

The number of long-term contracts continues to increase, as exemplified by the 12-month contract with Anglo Irish Bank.

Investment in new consultants continues to support SQS's rapid rate of growth. From 809 consultants at the end of 2007, the Company expects to have hired a further 115 consultants before the end of June. In addition to the off-shore test centre in South Africa, SQS has increased its global delivery capabilities with a new German and French-speaking off-shore centre in Cairo, Egypt. In addition, the recently established "home-shore" testing centre in Goerlitz, near the border with Poland, is progressing well. Language and culture are the most critical factors in the success of off-shore services and SQS is committed to providing world-class testing facilities on a global basis. 

SQS continues to build upon its position as the world's leading independent software testing and quality-management company. The focus remains on organic and acquisitive growth, as well as opportunities to expand its services across Europe and into new regions such as Asia and the Pacific.

In its Annual General Meeting today, as well as other ordinary resolutions, SQS is seeking the approval of shareholders to buy back up to 10% of the current share capital of the Company. Should the Company choose to buy back shares, those shares can be held in treasury and used as consideration for the acquisition of companies.

Finally, the company is pleased to report that the special "double dividend" of €0.20 will be paid to shareholders tomorrow, 29 May. 

Note1. Approximately 40% of SQS's total group revenues come from the UK. In the year to date, Sterling has weakened by approximately 14% against the euro. 

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Notes to Editors 

SQS is the global leader in independent software testing and quality-management services. SQS consultants design and oversee quality management processes during software and IT systems development and test the resulting products for errors and omissions.

SQS has three components to its service offering:

IT professional services: within its broad range of software testing and quality-management services, SQS has enhanced its offerings in the fields of management consulting (e.g. project and risk management), application intelligence, and outsourcing/off-shoring. 

Tools, licences, and maintenance: SQS's specialist range of software testing tools which work independently from and as add-ons to the tools available from competitors has been enhanced by successful market deployment of version 8.0 of our SQS-Test Professional product. 

IT training and IT events: the training business was extended. Two certification schemes were established (INTCCM for Configuration Management and IREB for Requirements Management); this will continue to result in additional courses including certification. ISTQB and ISEB courses were updated for the new versions of the syllabus. 

With more than 4,000 completed projects under its belt, SQS has a strong customer base including 36 FTSE-100 companies, half of the DAX 30 and nearly a third of the STOXX-50. It supports clients in a wide range of industries, including major corporations such as Deutsche Bank, Deutsche Telekom, Barclays, BP, Boots, Credit Suisse, Volkswagen, and Daimler

The successful SQC conferences (Software and Systems Quality Conferences), held in Germany, the UK, Switzerland and in Ireland, are the largest quality management and software testing events in Europe. The total number of delegates having attended in 2007 increased to 1,550 (2006: 1,470); the number of exhibitors increased from 82 to 88 while the number of sponsors stayed the same at 26. 

www.sqs-group.com