Independent software testing and quality management services provider, SQS Software Quality Systems AG (SQS.L) said Wednesday, in its trading update, that trading in the second half of the year progressed in line with expectations. It is slated to report preliminary results for the fiscal year on 10 March 2010.
The Cologne, Germany-based group's consultants design and oversee quality management processes during software and IT systems development and test the resulting products for errors and omissions. It supports clients across industries, including Deutsche Bank, Deutsche Telekom, Deutsche Post, Allianz, Meteor, BP, JP Morgan, UBS, Beazley, Volkswagen, and Daimler.
During the last quarter, the group saw improvement in rates of utilisation, with a return to normal utilisation levels in its services and consulting business. Although, price levels did not recover to historical level, price deflation experienced in the first half stabilised in the second half. SQS Software said it experienced improvements across its key markets of Germany and the UK and secured a number of new contracts, as the second half progressed. Austria and Switzerland continued to perform well. Nordic regions showed positive signs of recovery. Ireland operations continued to be weak, affected by the economic downturn.
The group further noted that new contracts secured include an international Nordic based fashion retailer for provision of a range of quality assurance and testing consultancy services; a German renewable energy solutions to integrate and execute the software testing of two development projects; a central European airport authority for settiong up of virtual test centre and IT integration for a German bank.
"We are pleased to report the improved utilisation rates and healthier end user markets that materialised during the second half of the year. We signed a number of significant contracts in the second half, many of which are ongoing, which contributed to a solid performance during that period and which provide good visibility into 2010. While we remain aware that markets have not yet fully recovered we are encouraged by recent developments and look forward to 2010," noted Rudolf van Megen, Chief Executive Officer of SQS.
In December, the group issued 57,045 new SQS ordinary €1 shares to its employees pursuant to an employee share purchase programme, resulting in proceeds to the tune of EUR 92,412.90 in cash.
During the first half of the fiscal, the group witnessed a sharp decline in its pre-tax profit to EUR 1.71 million on revenues of EUR 67.50 million, hurt by economic downturn.
SQS.L is currently trading at 242.90 pence, up 2.27% or 5.40 pence, on the LSE.
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