The key financial figures paint a mixed picture. On the one hand, sales increased more than budgeted to a new record level. This means that the SQS offering is in line with the market and continues to meet growing demand. On the other hand, costs rose even more sharply, causing the operating result and margin to fall. The two most important extraordinary cost drivers were the development of MS Dynamics 365 as the new system for enterprise resource planning (ERP) and customer relationship management (CRM) as well as the regulatory environment. The requirements of state accreditation and private authorisation bodies are leading to an ever-increasing administrative burden. In addition, in the name of impartiality and high qualification requirements, these bodies are restricting the opportunities to deploy auditors in a wide range of scopes. This reduces economies of scale, intensifies the shortage of skilled labour and thus drives up costs.

The results in the «Clients and Markets» area were pleasing. Customer satisfaction once again improved slightly at a high level. We also achieved our ambitious acquisition targets. SQS's services are therefore in high demand - both for the main standards ISO 9001, ISO 14001 and ISO 45001 as well as for branch-specific norms and standards. Thanks to 715 new customers, the already broad customer base was expanded even further. The fact that more than every second quotation issued led to a contract is also evidence of professional and efficient account management. On the other hand, cross-selling business lost momentum compared to previous years.

The SQS process landscape proved its worth in the reporting year. The QM Pilot process management system contains all of our specification documentation and reflects our day-to-day working methods and processes. The processes have also been continuously reviewed on the basis of a new high-level process organisation and as part of the D365 development and adapted where necessary. Both the internal audits and those conducted by the accreditation and other authorisation bodies led to pleasing results. The number of nonconformities could be further reduced from an already low level. The fact that there was not a single appeal against our certification decisions is also evidence of functioning processes and competent and conscientious employees. Only the productivity of the auditors was again slightly below target.

As part of the creation of the «Organisational Development and Human Resources» department (see explanations under 1.3.2 Organisation and environment), the key performance indicators were also adjusted in 2024. The qualitative indicators, which are evaluated every two years (last time in 2023 and next time in 2025) by means of the employee survey, remain relevant. Starting in 2025, we will consider unused holiday credits, days absent due to illness and employee overtime as additional key figures. The year 2024 will serve as the base year.

The Executive Management and the Board had already responded to the need for action arising from the context described above before the reporting year. In 2024, however, several ground-breaking measures were planned and implemented, which are reflected in a so-called future organisation and a new organisational chart:

Establishment of the department «Organisational Development and Human Resources»: This department reports directly to the CEO. Its mission is to ensure that SQS is and remains an attractive employer that can acquire, develop and retain the necessary human resources.

Strengthening the department «Finance, Controlling and Reporting»: This department, which also reports directly to the CEO, was reinforced in terms of personnel and expertise. This enables operational accounting, to serve as a basis for measures to control costs, increase efficiency and generally further develop the organisation.

Establishment of the division «Marketing, Public Affairs and Sales»: This new division, headed by a member of the Executive Management, consists of the departments «Marketing, Communication and Public Affairs» and «Market Development and Sales». This reorganisation is intended to achieve in particular three goals: efficient and effective communication with all relevant target groups (FB MAKOPA); the strengthening of sales; a seamless Customer-Journey through coordination and cooperation between marketing and sales.

Creation of four «Operations» divisions: These new divisions, each headed by a member of the Executive Management, allow for a stronger industry orientation and thus the fulfilment of increasingly specific customer needs.

Establishment of the specialist department «Sustainability Services»: This new department, managed by a member of the Executive Management, enables to centrally develop and offer services in strategic business unit 2. With the same objective, the product portfolio of the subsidiary SQS Deutschland GmbH has been transferred to this specialist department.

Realignment of the D365 project: Since 2022, SQS has been working on the development of a system for enterprise resource planning (ERP) and customer relationship management (CRM) based on the Microsoft Dynamics 365 (D365) software. As there is no standard solution on the market for accredited conformity assessment bodies, SQS and its development partner Ambit Group are entering uncharted territory. In 2024, due to the growing complexity of the project, we jointly concluded that the D365 target architecture needed to be simplified. This realignment postpones the system launch from 2025 to 2026.

Successful first financial year for SQS Italia S.r.l.: Italy is the world's second largest market for accredited certifications. The Italian government does not enforce numerous regulatory requirements itself, but rather through CABs that are approved by the accreditation body Accredia. In order to serve this large and dynamic market even better and, for example, to obtain accreditations that are only relevant for Italy, SQS founded in 2023 SQS Italia S.r.l. based in Milan. The subsidiary began several accreditation procedures in its first full financial year and was once again able to significantly increase its turnover. It benefited from the fact that, thanks to the support of and synergies with the Swiss parent company, it can operate a very lean and efficient business model, which is based in particular on the flexible use of freelance auditors. There is a good chance that SQS Italia will continue this joint success story in Italy.

Withdrawal from the Swissmedic notification: After other CABs withdrew, SQS was the only Notified Body based in Switzerland for the certification of products and quality management systems in accordance with the Medical Devices Ordinance (MedDO) for several years. In 2024, we decided to discontinue the associated activities and let the notification by Swissmedic expire at the end of March 2025. The decision had to do with the increased and still increasing regulatory requirements. In order to fulfil these in the medium and long term, we would have had to make major investments. However, an associated growth strategy was not possible because the market environment and -potential remained characterised by important regulatory and political uncertainties in the foreseeable future. These included, in particular, the unresolved recognition of Swiss medtech certificates by the European Union. Despite withdrawing from the MepV area, we continue to certify quality management systems in accordance with ISO 13485:2016.

Restructuring of SQS Germany GmbH:  The subsidiary, based in Constance, was founded in 2021 to ensure uninterrupted access to the European Single Market for Swiss companies in the context of the unresolved recognition of Swiss medtech certificates by the EU. Due to political and regulatory changes, the SQS Board decided in 2023 to discontinue the associated notification procedure in Germany. This limited the activities of the German subsidiary to the development and implementation of services in the area of sustainability. In 2024, the SQS management decided to merge the sustainability products of the parent company and the German subsidiary into one portfolio as of 1 January 2025 (see this press release), which will be managed by the new specialist division from Switzerland. This should facilitate customer- and needs-specific market development on the one hand and enable synergies on the other. Internal and external follow-up solutions have been found for the affected employees of SQS Deutschland GmbH.