German telecommunications provider QSC AG (QSCGF.PK) Monday reported a decline in fiscal 2012 earnings, while revenues marginally increased from last year. For fiscal 2013, the company forecast lower revenues.
The firm, which is on its way to become a full-fledged ICT provider, said its board will propose a higher dividend that it aims as the minimum for the coming years.
Announcing its preliminary results, the company said its earnings before interest, tax, depreciation and amortization, or EBITDA, a key earnings measure, declined to 77.9 million euros from 79.9 million euros in the previous year. Earnings before taxes were 20.7 million euros, compared to 23.4 million euros in fiscal 2011.
Annual revenues rose 1 percent to 481.5 million euros from 478.1 million euros in the prior year.
"Our strategy is working. Step by step, QSC is withdrawing from TC business and participating in the growth of the ICT market. In fiscal 2013, we will be bringing further in-house Cloud product developments to market, winning additional Outsourcing projects and thus strengthening our position in the ICT market," said Chief Financial Officer Jürgen Hermann, who will succeed Bernd Schlobohm as Chief Executive Officer on May 30.
The company also said its board will propose a 1 cent increase in dividend to 0.09 euros per share.
For fiscal 2013, the company expects overall revenues to be at least 450 million euros, lower than that of 2012.
In spite of declining revenues, QSC anticipates higher profitability and a stronger financial position. EBITDA margin in 2013 is likely to rise to at least 17 percent, with an increase of nearly 24 euros million planned for free cash flow.
According to the firm, a significant rise in ICT revenues will be offset by further declines in TC revenues.
In last November, the German Federal Network Agency had lowered mobile termination fees by 45 to 47 percent and fixed-network termination fees by 20 to 40 percent. The company noted that various rulings by the German Federal Network Agency will result in additional decline of around 30 million euros in TC business.
For fiscal 2016, QSC has set its revenues to be between 800 million euros and 1 billion euros, along with an EBITDA margin of 25 percent and a free cash flow of between 120 million euros and 150 million euros.
On Frankfurt's Xetra, QSC shares closed Friday's regular trading at 2.61 euros, down 1.25 percent.
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