SQS Software Quality Systems AG Regulatory News (SQS)

13 Aug 2008 07:00

13 August 2008

SQS Software Quality Systems AG 

("SQS" or the "Company")

SQS Business Update

Contract signings, new partnership and completion of earn-out period 

SQS, the global leader in independent software testing and quality management services, is pleased to announce a number of contract wins within its new and fast growing business divisions of Offshoring and Change & Requirements Management. The Company is also pleased to announce that it has been honoured as Special Expertise Partner by SAP Germany and, lastly, the end of its 2 year earn out period with Cresta Ltd., which has performed significantly beyond expectations. 

SQS has secured a contract worth €3m to provide testing services to a news & data service provider based in Switzerland. SQS will utilise twelve members of staff to provide a mix of onshore and offshore testing services until 2011.

The Company has also signed an agreement to provide offshore testing services to a large Central-European bank for an initial 6 month calibration phase worth €0.6m. This is a preparatory phase during which the client will assess the extent of the off-shoring testing services it wishes to employ in the future. The contract, therefore, has the potential to lead to significantly greater revenue streams going forward. 

Both the above contracts are with new clients and demonstrate the appeal to organisations of off-shoring all or part of their software testing operations. Instrumental in winning deals of this kind has been SQS's ability to deliver an entire onsite/offshore "Multi Language" solution using a single unified methodology. These contract wins further validate SQS's off-shoring strategy, which has seen the Company rapidly expand its off-shore capabilities over recent years to become the leading provider within the industry, with facilities in Egypt, South Africa and India. 

In addition SQS has signed a deal to provide Change & Requirements Management services to a leading German car manufacturer until 2012. Although for a smaller sum than the above contracts the agreement is significant as it demonstrates the value of this relatively nascent offering from SQS. The service, which tracks and manages all requirement changes made during the software development lifecycle, is currently experiencing high levels of demand. 

Further to the above, SQS is proud to announce that it has been selected as a "Special Expertise Partner for Testing and Quality Management" by SAP Germany, a subsidiary of SAP AG, the world's leading provider of business software solutions. As well as the cache associated with such an accreditation, the partnership is expected to significantly strengthen the SAP testing business, based predominantly in Germany.

Finally, following the completion on 30 June of the two year earn-out period associated with the acquisition of Cresta Ltd. (now part of SQS UK), SQS is pleased to announce that the PBT targets set for this period were exceeded by a significant margin. The final numbers are still subject to audit but the acquisition can comfortably be declared a resounding success to date, with several of the key directors of Cresta continuing to work in senior positions within SQS.

Rudolf van Megen, Chief Executive Officer of SQS commented, "I am delighted to announce these contract wins as they lend proof to the validity of our new initiatives and strategy of expanding our off-shoring capabilities. The special partnership helps to secure our strong business relationship with SAP while providing an excellent reference point and giving further industry recognition. Finally, Cresta's surpassing of the high targets we set for it on acquisition have proven it to be an exceptional addition to the Group and demonstrate our ability to identify appropriate acquisitions and integrate them successfully."  

SQS will be announcing its interim results for the 6 months ended 30 June 2008, on 4 September 2008.

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About SQS

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.

Headquartered in Cologne, Germany, SQS now has more than 1,400 employees across Europe, Asia, North America and in Africa. The Group has a strong presence in Germany (Cologne, Munich, Frankfurt, Stuttgart, Goerlitz and Hamburg) and in the UK (London, Woking, Birmingham, Manchester, Belfast), Ireland, the Netherlands, Switzerland, Austria, Sweden, Norway, Finland, India, Egypt, the United States and South Africa. SQS also has a minor stake in an operation in Portugal and a partnership operation in Spain.

With more than 4,800 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.

www.sqs-group.com