QSC AG

THE DIGITISER OF THEGERMAN SME SECTOR

Commerzbank Sector Conference – TMT, Consumer & Real Estate

Frankfurt, 30 August 2018

QSC AG

Disclaimer

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This presentation contains statements relating to the future which are based on estimates of the QSC AG

(“QSC“) Management Board and which reflect its current views on future events. The statements

relating to the future correspond to the circumstances at the time of creating the presentation.

Statements of this nature are subject to risks and uncertainties which QSC is largely unable to influence.

These risks and uncertainties will be dealt with in detail in the risk report as part of financial reporting.

Although the statements relating to the future have been made with the greatest of care, their

correctness cannot be guaranteed. The actual results may therefore differ from the expected results

described here. QSC shall neither adjust nor update statements relating to the future after publication

of the presentation.

QSC AG

1. Business overview

QSC AG

Key figures at a glance

Revenues of

€357.9min 2017

Proprietary

TÜV and

ISO-certified

data centres on

20,000 m²

Proprietary

nationwide

All-IP-based

network

>30,000SME customers

years

of experience30

Awards Experton Industrie 4.0/IoT

Rising Star 2017

Experton Security

Leader 2016

Experton Cloud

Leader 2016

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~1,300 employees

in 12 locations

QSC AG

Our mission

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With decades of experience and

expertise in the areas of Cloud, Internet of Things,

Consulting, Telecommunications and Colocation,

QSC accompanies its customers securely

into the digital age.

QSC AG is the digitiser of the

German SME sector.

Secure.

Innovative.

At your side.

QSC AG

The base of digitization: Cloud solutions

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Our cloud solutions offer all the

benefits of cloud technology and

covers all aspects of a company’s

IT landscape:

Available on every end appliance

Needs-based invoicing

Available around the clock

Uncomplicated provision

Data security

QSC AG

Digital

QSC portfolio SAP HANA

Platform

SAP S/4HANA

Proprietary

IoT Cloud

platform for a

large number

of IoT and

Industry 4.0

scenarios

Managed

Security

Services

Certified

German

Data Centres

All-IP Voice

and Data

Services

Corporate

Network

Services

Workplace

Services

Application

Services

Communi-

cation as a

Service

Multi Cloud

Key digital

technologies*

Portfolio covers the key digital technologies

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IOT ALL-IPBIG DATACLOUD SECURITY

* Sources: Bitkom, Crisp Research, IDC, own research

QSC AG 8

1. We offer a full-range portfolio covering Cloud, IoT, Consulting, Colocation and

Telecommunications with a proprietary data centre and network infrastructure

2. We are an agile service provider, understanding the business and the needs of SMEs

3. We guarantee end-to-end quality

Proprietary TÜV and

ISO-certified

data centres in

Germany

Proprietary cloud and

multi-cloud solutions

Proprietary high-

performance data

and voice network

End-to-end

services covering all

aspects of digitisation

What makes QSC unique in the competitive environment

QSC AG

DAX enterprises

Major enterprises>5,000 IT seats/employees

Small and very small

enterprises<50 IT seats/employees

9Sources: Federal Statistical Office, 2016; techconsult “IT-Cloud-Index” 2015

3,500,000

approx. 16,000

approx. 50,000

30

550

Global Players

Providers

Number of German

companies by size

category

Web hosters

Larger SMEs200 – 5,000 IT seats/employees

SMEs50 – 200 IT seats/employees

Direct sales

Indirect sales

Additional USP: The clear focus on German SME sector

QSC AG

2. Financial development in H1 2018

QSC AG

Financial Highlights H1 2018: Revenues up by 6%

Revenues increased by 6% to € 186.2 million

Cloud revenues grew by 36%

TC revenues up by 14%

Profitability developed as expected; EBITDA came to € 18.2 million

Net profit increased by 18% to € 1.3 million

Successful increase in syndicated loan volume from € 70 million to € 100 million

QSC expects revenues to be at least at the upper end of the € 345—355 million range

predicted for FY 2018

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QSC AG

New vertical organisation is up and running and leading to numerous sales successes

Cloud Services won PEAC Germany (formerly IKB Leasing) as a new customer and

will now build and run a multi-cloud solution for PEAC Germany

Outsourcing extended its contract with Imperial Tobacco and will start to integrate

cloud and multi-cloud solutions

Consulting is already migrating SportScheck’s database system to SAP HANA —

the new system will be based on QSC’s Pure Enterprise Cloud

TC is now collaborating with more than 30 regional energy providers and city carriers;

Saxony-based “eins” is among the latest customers

Annual Shareholders Meeting has approved the spin-off of TC business

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Operational Highlights H1 2018: Successful sales push

QSC AG

H1 2018: Higher revenues and higher profit

Revenues driven by two

segments: Cloud and TC

Gross profit and EBITDA

impacted by higher costs of

revenues (as a result of the

higher share of low-margin

TC business with resellers)

EBIT is benefiting from

lower depreciation

Sustainable net profit

since Q1 2017

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QSC AG

Profitability developed as expected

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QSC AG

Telecommunications: Double-digit growth of 14%

TC reseller business benefited from a

favourable market environment and the

highly efficent Next Generation Network (NGN)

Continued moderate growth in business

with corporate customers

Change in revenue mix and increased sales

activities have impacted the segment contribution

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TC revenues with resellers

TC revenues with corporate customers

TC total

Segment margin

QSC AG

Cloud: Business model starts to prove its scalability

Higher interest in Cloud Services and IoT solutions

led to revenue growth of 36% in H1 2018

Cost of revenues only increased by 15%

to € 10.9 million; clear proof of the

cloud business model’s scalability

Strong increase in profitability:

Segment margin soared to 11.5%

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Segment margin

QSC AG

Outsourcing: Revenues developed as expected

Revenues in Q2 2018 (€ 23.9 million) at the

same level as in Q1 2018 (€ 23.7 million)

Y-o-Y decrease mainly influenced by termination

of one large contract in Q3 2017

In the course of H2 2018 and at the beginning of

2019, two further contracts will be terminated

Ongoing revenue transition to the Cloud segment

Organisational restructuring has effects on

the segment contribution

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Segment margin

QSC AG

Microsoft

SAP

Microsoft and SAP

Segment margin

Consulting: Segment margin grew to 17% in H1 2018

Revenues at a stable level of between € 9 and

€ 10 million per quarter (Q2 2018: € 9.4 million;

Q1 2018: € 9.8 million)

Skills shortage has an influence on SAP

consulting, especially on S/4HANA business

Ongoing optimisation of current staff utilisation

ensures a high segment margin

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QSC AG

Moderate CAPEX in H1 2018

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Completion of initial investments in

cloud services has had positive effects

on CAPEX this year

Ongoing investments in modernisation

of infrastructure and data services as

well as customer projects

QSC aims to invest around € 20 million

in FY 2018 (same level as in 2017)

QSC AG

FCF showing strong increase in Q2 2018

Q1 2018 was influenced by high prepayments

for the full year as well as severance payments

In Q2 2018, FCF benefited from positive

development in operating business

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2nd quarter

1st quarter

QSC AG

Higher equity ratio and higher flexibility of financing

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Equity ratio up by 2 percentage

points compared to 31 Dec 2017

Increase in short-term debt

caused by reclassification of

first tranches of promissory

note loan (€ 100 million),

due in May 2019

Successful increase in syndi-

cated loan volume to € 100

million guarantees smooth

refinancing of promissory

note loan due in May 2019

QSC AG

Given the good first half of 2018, QSC is now expecting:

Revenues to be at least at the upper end of the € 345—355 million range

EBITDA of € 35—40 million

Free cash flow > € 10 million

Forecast: Growing optimism about revenue development

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QSC AG

QSC AG

Cloud & ITOProfit centre

The new vertical organisation at a glance

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ConsultingProfit centre

ColocationProfit centre

TelecommunicationsPlusnet GmbH

Internet of Things (IoT)Q-loud GmbH

QSC AG

New opportunities with corporate customers: NetCologne

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QSC provides central components

for the new cloud offering of

NetCologne

White label solution for the

development of cloud-based

telephone systems

Fast time to market (TTM)

thanks to flexible IT architecture

QSC AG

New opportunities with resellers: fibre optics

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More and more local authorities

are developing their own fibre

optic networks –

QSC can operate them

Since October 2017, QSC has

also been feeding this customer’s

network with voice, data and

IPTV functionalities

Fibre optic network will cover

50,000 FTTH and FTTB

connections

QSC AG

SECURITY & DOMAINS

SERVICES & SOLUTIONS

Colocation services: flexible and individual

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COLOCATION DATA CENTRE

Colocation rack

Cage & area

Twin data centre

Remote hands

Server, storage and network

VIRTUAL DATA CENTRE

Infrastructure as a service

Hybrid und private cloud

DevOps@QSC

Managed NetworkStorage on Demand

Managed OSManaged Virtualisation

Managed Monitoring

DDoS-Protection

Email Security VPN

DDoS Protection

Domains

Managed Solutions

Backup

Firewall SSL certificates

QSC AG

Consulting: QSC is an excellent SAP full-service provider

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QSC is an SAP Gold Partner

The partner status recognises performance in terms of service, quality and SAP

expertise. SAP customer projects and qualified customer references are included.

The award documents that the SAP-HANA offering as well as the project

implementation satisfy the high expectations of QSC customers.

The award is given to partners with special expertise and successful reference

projects for an SAP solution or sector.

SAP HANA Leader Germany 2017

The end-to-end approach – with which the SME sector is fully supported in

all SAP-HANA services – was highlighted above all else.

QSC publishes book on SAP

17 QSC authors, 1 topic: “Logistics with SAP”. The book was a bestseller at

SAP PRESS in November and December 2017.

QSC AG

Cloud: PEC convinces our customers

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Realisation

Provision of complete

business IT from the Pure

Enterprise Cloud

Highly available operation

in the QSC data centres

Database services

VoIP services

Operation of the entire

LAN/WAN

Assumption of all desktop

services

Outlook

Fast integration of

further life insurance

companies into the

IT environment

First life insurance

company has already

been acquired and

incorporated in the IT

by QSC

Objective

IT landscape is to grow

flexibly and swiftly with

the new business model

and rapidly increasing

data volumes

Secure operation of the

business IT in the German

judicial area

High availability

Provision of virtualised

enterprise workplace

environments

Cost efficiency through

modern procurement

model from the cloud

Sector: banks and

insurance companies

Revenues: € 1.3 billion

Headquarters: Bad

Homburg

QSC AG

IoT: Q-loud convinces with full-stack approach

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Concept &Consulting

Software Development

System Integration

SecureConnectivity

StandardisedHardware

HardwareDevelopment

IoTPlatform

EcosystemHardware Production

HardwareRetrofit

IoT Backend

Innovator (2016)

QSC AG

Q-loud convinces in Smart Energy (NB-IoT)

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Energie meter- Electricity

- Gas

- Heating

- Water

Q-loud-

IoT adapterEnergyCam,

NB-IoT modem

Q-loud-

IoT data source

Big Data analytics,

user application,

smart support

On site /third provider

Equipment Integration / hardware / operation Application / analytics

868 MHz

AES encryption

Q-loud

Gateway

TCP/IP

MNO

NB-IoT

Edge Connectivity

QSC AG

Contact

QSC AG

Arne Thull

Head of Investor Relations

T +49 221 669-8724

F +49 221 669-8009

invest@qsc.de

www.qsc.de

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QSC AG

QSC AG

Mathias-Brüggen-Str. 55

50829 Cologne, Germany