Profit warning: The profitability challenges of old software delivery projects and the decrease in new sales of software licenses weaken the outlook for the second half of the year – QPR Software Plc lowers its financial guidance for 2022

QPR SOFTWARE PLC                 STOCK EXCHANGE RELEASE               September 7, 2022 at 4 pm

INSIDE INFORMATION             

      

The Company has had to reassess the billing and profitability of some software-related delivery projects and their contracts signed in 2020 and early 2021. These are estimated to decrease the outlook of the consulting business and software maintenance for the year 2022.

The company's strategic focus on growing the SaaS (Software as a Service) business has changed the focus of new customer acquisition to SaaS contracts instead of software license deals. The operating environment has continued to be challenging. The increased instability of the operating environment in Europe due to Ukraine’s war, high inflation, and the consequences of the COVID-19 pandemic create uncertainty in acquiring new customers.

Due to the aforementioned factors, the company estimates that the revenue and operating profit for 2022 will fall short of the previous estimate. SaaS growth, which is at the core of the company's strategy, is not sufficient at this stage to compensate for the declining revenue. The company will initiate measures to improve profitability and will inform about the related actions later.

The updated financial guidance for 2022:

QPR Software Plc expects revenue and operating profit to be substantially below the reported figures for 2021 (turnover in 2021: 9,140 thousand euros, operating profit in 2021: -1,248 thousand euros) and SaaS revenue to grow by 25-35% compared to 2021 (2021: 1,283 thousand euros).

The previous financial guidance for 2022 (published on 22 April 2022):

Based on the increased sales offer base, continuous customer revenues, and consulting booking rate, QPR Software estimates that its turnover will increase in 2022 (2021: 9,140 thousand euros) supported by the growth of SaaS turnover.

QPR will announce the January-September 2022 interim report on 21 October 2022.

For further information, please contact:

QPR Software Plc

Jussi Vasama

Chief Executive Officer

Tel. +358 50 380 9893

About QPR Software

QPR Software Plc (Nasdaq Helsinki) provides process mining, performance management, and enterprise architecture solutions for digital transformation, strategy execution, and business process improvement in over 50 countries. QPR software allows customers to gain valuable insights for informed decisions that make a difference.

Dare to improve. www.qpr.com

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Nasdaq Helsinki

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www.qpr.com