EQS Group AG publishes results for 2019
Guidance for the 2020 financial year

Munich - 03 April 2020

EQS Group AG (ISIN: DE0005494165) successfully continued its strategic transformation to a technology company and achieved a revenue of EUR 35.37 million in the 2019 financial year. The slight revenue decline of 2 percent compared with the previous year resulted from the sale of ARIVA.DE AG. Adjusted by the sales revenue of the subsidiary which was deconsolidated in the middle of 2019, the company's revenue rose by 11 percent to EUR 31.87 million. Its EBITDA rose to EUR 2.55 million (adjusted for IFRS 16: EUR 0.496 million), taking into account the accounting guidelines for leases pursuant to IFRS 16. The Group's loss for the year totalled EUR -1.41 million and its earnings per share amount to EUR -0.90.

The company reports a volume of EUR 3.8 million for the figure New ARR representing the newly concluded annual recurring revenue order volume which was introduced for the first time. The number of new customers (Large Caps) stood at 320.

The Group achieved a revenue of EUR 8.78 million (-15%) in the period from October to December. Its EBITDA rose to EUR 1.90 million (adjusted: EUR 1.22 million by taking into account IFRS 16), and the consolidated profit for the year totalled EUR -0.689 million. Adjusted by the consolidation effects of ARIVA.DE AG, the company's revenue was up by 7 percent.

Segment development

The Compliance segment was able to rise its revenue in the year 2019 by 4 percent to EUR 19.29 million (EUR 18.50 million). Adjusted by ARIVA.DE AG, this revenue increase was 15 percent and thus significantly higher. The number of customers rose by 138 to 1,280 in terms of Large Cap customers; XML submission customers were up by 468 to 4,771 and the customers of the company's LEI awarding service increased by 7,809 to 37,575. Revenue in the Investor Relations segment declined by 9 percent to EUR 16.08 million (EUR 17.71 million) due to the deconsolidation of ARIVA.DE AG. Adjusted by ARIVA.DE AG, the revenue grew by 5 percent. The company was able to rise its number of customers by 134 to a total of 2,172.

The migration of customers to the new COCKPIT gained in momentum. More than 300 customers have signed up to the new platform.

Achim Weick, founder and CEO of EQS Group AG said: "The 2019 financial year was successful, but also challenging due to the delays which occurred in the onboarding process of our customers to the new COCKPIT. It also marked the turning point in our Cloud 2020 investment campaign and the earnings development. For the current financial year - which is, by the way, the 20^th since our foundation - we are very confident that we will be able to achieve all of our objectives. I am fully convinced that in five years' time, EQS Group AG will be the leading European cloud provider for global Investor Relations and Corporate Compliance solutions."

The revenue grew by 11 percent (adjusted) in the 2019 financial year and was thus lower than expected at the beginning of the year. The delayed completion of individual CRM and mailing functions in COCKPIT and Policy Manager resulted in a postponed onboarding of customers to the new platform and thus to lower revenue increases than planned and could not be compensated otherwise in view of a weaker economic development and the lower number of initial public offerings associated therewith. For three consecutive quarters, total expenses on the cost side rose underproportionally to earnings, as forecasted, due to the time sequence of the investment programme. This trend will sustainably continue in the upcoming quarters.

EQS Group AG sold its stake in the amount of 92 percent in ARIVA.DE AG to wallstreet:online AG with effect on 1 July 2019. The decision to fully sell the shares in ARIVA.DE AG is based on the strategic orientation of EQS Group AG to the fields of Corporate Compliance und Investor Relations. The price was significantly above the accumulated cost and thus led to extraordinary earnings in the amount of initially EUR 2.27 million. EQS Group AG assumes to achieve an additional purchase price payment of EUR 0.2 million to EUR 0.3 million in the 2020 financial year thanks to a revenue-depending earn-out component.

Due to the subdued expectations of business development in Asia and allocation of advertising budgets of German issuers, unscheduled amortization of goodwill was carried out at the subsidiaries EQS Asia Ltd. (EUR 0.782 million) and at the subsidiary EQS Financial Markets & Media GmbH (EUR 0.779 million). In Asia, the planned cross-selling of products to the acquired TodayIR customers did not materialize as expected. At our subsidiary EQS Financial Markets & Media GmbH, the expected recovery of media budgets of advertising customers failed to materialise for two consecutive years. Therefore, both goodwill was adjusted to the current value (discounted cash flow valuation).

The recurring revenue on the Group level had a quota of 83% in the fourth quarter. The value for Large Cap customers in Germany is still almost as high at 85%. This is based on a customer base of 1,246 customers.

Outlook: further growth in 2020 with lower investment activity

The Management Board expects an adjusted rise in revenue by 10 to 20 percent to between EUR 35.1 million and EUR 38.2 million and a significant improvement of the EBITDA in comparison with the previous year in a range of between EUR 3.5 million and EUR 4.5 million. For the figure New ARR which designates the contractually concluded annual recurring business volume, we expect a volume of EUR 4.5 million to EUR 5.5 million. And we plan to win 320 to 400 new customers (Large Caps). This forecast applies subject to the material impacts caused by the Corona virus.

The Management Board will explain the corporate results from 11:00 (CEST) in today's telephone conference which will be broadcasted live on the internet at www.eqs.com.

*Limited comparability due to new IFRS Accounting for Leases (IFRS 16) as of Jan. 1, 2019
** Prior-year figures adjusted. We refer to Point 2. "Significant accounting and valuation methods"
(2.4 Changes in the previous year's figures) in the notes of the annual report 2019

More information:

The figures for FY 2019 are audited.

Receive news from EQS Group AG free of charge on your mobile device: via DGAP News App directly to your AppleWatch or iPhone (http://newsapp.dgap.de/).

EQS Group is a leading international provider of regulatory technology (RegTech) in the fields of corporate compliance and investor relations. In working with EQS Group, thousands of companies worldwide inspire trust by fulfilling complex national and international disclosure obligations, minimizing risks and communicating transparently with stakeholders.

EQS Group's products are pooled in the cloud-based software EQS COCKPIT. They ensure the professional control of compliance workflows in the fields of whistleblower protection and case management, policy management, insider list management and disclosure obligations. In addition, listed companies benefit from a global newswire, investor targeting and contact management, IR websites, digital reports and webcasts for efficient and secure investor communications.

EQS Group was founded in 2000 in Munich, Germany. Today the group employs over 350 professionals and has offices in the world's key financial markets.

Contact:

André Marques

CFO

Tel.: +49 89-21029833

Mobile: +49 175-5250009

Email.: [email protected]