Largest Ever Contract Win and Extensions

8 January 2012

SQS Software Quality Systems AG

("SQS" or the "Company")

Largest Ever Contract Win and Contract Extensions

SQS Software Quality Systems AG (AIM:SQS), the world's leading specialist in software quality services, is pleased to announce that the Company has been awarded a number of significant Managed Services contracts and contract extensions/renewals worth a total of €64m over the next three years, including its largest ever contract win and largest ever contract extension. The total order intake from Managed Services contracts during 2012 was €101m, up 52% from 2011.

SQS has signed its largest ever contract, worth at least €25m over the next three years, with an existing client in the automotive sector. The contract is to provide Managed Services and Specialist Services to the client, where previously SQS had provided traditional testing services only. Provision of traditional testing services will continue, such that revenues from the new contract will be more than 50% in addition to existing revenues from the client.

The Company has also been awarded its largest ever contract extension, worth €24m. This is to provide Managed Services to a tier-1 European bank over the next two years.

In addition, SQS has won a significant contract renewal, worth a further €15m in fees over the next year. This is also to provide Managed Services to a tier-1 global bank.

Dik Vos, CEO of SQS, commented: "We stated at the time of our interim results in September that one of our strategic goals was to focus on securing larger contracts and we are therefore especially delighted with our recent contract wins, extensions and renewals. These expand upon what were already some of our biggest contracts to date and are clear evidence of the high value our clients place upon our offerings, as well as the successful delivery of our Managed Services strategy."

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About SQS Software Quality Systems

SQS is the world's leading specialist in software quality. This position stems from 30 years of successful consultancy operation. SQS consultants provide solutions for all aspects of quality throughout the whole software product lifecycle driven by a standardised methodology and deep experience in various industries. Headquartered in Cologne, Germany, the company employs approximately 2,200 staff. Along with a strong presence in Germany and the UK, SQS has further subsidiaries in Egypt, Finland, France, India, Ireland, the Netherlands, Norway, Austria, Sweden, Switzerland, South Africa and the US. In addition, SQS maintains a minority stake in a company in Portugal. In 2011, SQS generated revenues of 189.1 million Euros.

SQS is the first German company to have a primary listing on the AIM (Alternative Investment Market) in London. In addition, SQS are also traded on the open market of the German Stock Exchange in Frankfurt am Main.

With over 7,000 completed projects under its belt, SQS has a strong client base, including half of the DAX 30, nearly a third of the STOXX 50 and 20 per cent of the FTSE 100 companies. These include, among others, Allianz, Beazley, BP, Centrica, Daimler, Deutsche Post, Generali, JP Morgan, Meteor, Reuters and Volkswagen as well as companies from every other conceivable industry.

For more information, see sqs.com