DGAP-News: CANCOM: Nine-month results confirm optimistic outlook for annual results 2018

CANCOM: Nine-month results confirm optimistic outlook for annual results 2018

- 9M 2018: Group sales up 19.1 percent and EBITDA (adjusted) 29.9 percent year-on-year. EBITDA margin (adjusted) rises to 8.1 percent.

- Best quarterly result ever in the third quarter of 2018.

- Strategic transformation is making good progress: Annual Recurring Revenue increased by around 45 percent compared to the previous year.

- Management Board very optimistic for 2018 annual results.

Munich, Germany, 12 November 2018 - Based on the best quarterly result in the company's history in the third quarter of 2018 and business development in the nine-month period as a whole, CANCOM Group management is optimistic about the remainder of the year. "The latest results show that we can successfully advance CANCOM's medium-term strategic transformation and at the same time our day-to-day business. Our current positive momentum will certainly also be reflected in our annual results for 2018," said Thomas Volk, CEO of CANCOM SE.

In the first nine months of fiscal year 2018, the CANCOM Group generated consolidated revenues of EUR 963.7 million (previous year: EUR 809.0 million). This corresponds to a strong improvement of 19.1 percent over the previous year. Organic sales growth, i.e. excluding the effects of acquisitions, amounted to 12.1 percent in this period.

At EUR 78.2 million, EBITDA (adjusted) was 29.9 percent up on the previous year (comparable previous year: EUR 60.2 million). This key figure shows the real profitability of the CANCOM Group before deduction of special investments and incidental acquisition costs in the current financial year. The CANCOM Group's EBITDA margin (adjusted) improved accordingly to 8.1 percent (comparable previous year: 7.4 percent).
Excluding the adjustment, EBITDA under IFRS amounted to EUR 71.0 million, up 17.9 percent year-on-year (comparable previous year: EUR 60.2 million).

The figures for the third quarter of 2018 included in these nine-month figures were EUR 355.2 million for Group sales (previous year: EUR 273.1 million), EUR 29.5 million for EBITDA (adjusted) (comparable previous year: EUR 21.6 million) and EUR 26.7 million for EBITDA according to IFRS (comparable previous year: EUR 21.6 million). These figures exceeded all previous quarterly figures in the CANCOM Group's corporate history.

High growth rate in strategically important Annual Recurring Revenue

In the Cloud Solutions Group segment, CANCOM increased revenue by 40.0 percent year-on-year to EUR 174.7 million in the reporting period from January to September 2018 (previous year: EUR 124.8 million). In the Cloud Solutions segment, the sustained high rate of increase in the Annual Recurring Revenue (ARR), i.e. the expected recurring revenues from managed service contracts, should also be highlighted. Increasing the ARR is a key objective of the CANCOM Group's strategy. As of the end of September 2018, CANCOM had improved its ARR by around 45 percent year-on-year to around EUR 125 million (previous year: EUR 86 million).
EBITDA (adjusted) in the Cloud Solutions Group segment amounted to EUR 44.1 million (comparable previous year: EUR 29.6 million). The EBITDA margin (adjusted) was 25.3 percent (comparable previous year: 23.7 percent).

In the Group segment IT Solutions, CANCOM also recorded a very satisfactory growth rate of 15.3 percent in the nine-month period, achieving sales of EUR 789.0 million (previous year: EUR 684.1 million). EBITDA (adjusted) amounted to EUR 42.9 million in the first nine months (comparable previous year: EUR 37.7 million). The EBITDA margin (adjusted) was 5.4 percent (comparable previous year: 5.5 percent).

The figures for the third quarter of 2018 were revenue of EUR 65.0 million for Cloud Solutions (previous year: EUR 45.1 million) and EUR 16.8 million for EBITDA (adjusted) (comparable previous year: EUR 11.3 million). In the IT Solutions segment, revenue in Q3 amounted to EUR 290.2 million (previous year: EUR 227.9 million) and EBITDA (adjusted) to EUR 16.2 million (comparable previous year: EUR 12.8 million). The Cloud Solutions segment's EBITDA (adjusted) in the third quarter was thus again above the value of the IT Solutions segment.

Optimistic outlook for 2018 annual results

With a view to the Group results for the full 2018 financial year, the Executive Board of CANCOM SE confirmed the existing forecasts. "Due to the current dynamic business development, we are very optimistic about annual sales in 2018. Our expectation to reach our annual targets for gross profit, EBITDA, EBITA and EBIT remains unchanged as well," explains Volk. The CANCOM Group's annual forecast foresees significant growth rates for both the Group and the segments in relation to organic growth and without adjustments. Together with the annual forecast, the Management Board confirmed that the total volume of special investments made in the 2018 financial year in growth projects and ancillary acquisition costs will amount to around ten million.

The CANCOM Group's complete interim statement as of 30 September 2018 is published in the Investors section of its website at www.cancom.de.

Note: The previous year's EBITDA figures mentioned above ("comparable previous year") were recaluculated retrospectively for the effect of this year's first-time application of IFRS 16 in order to ensure comparability.

About CANCOM
As a Digital Transformation Partner, CANCOM accompanies companies into the digital future. The CANCOM Group's range of IT solutions includes consulting, implementation, services and the operation of IT systems. Customers benefit from the extensive expertise and an innovative portfolio that covers the IT requirements of companies necessary for a successful digital transformation, for example with business solutions and managed services for IT trends such as cloud computing, analytics, enterprise mobility or security.
The worldwide more than 3,000 employees of the internationally active CANCOM Group and an efficient partner network ensure market presence and customer proximity in Germany, Austria, Switzerland, Belgium, Great Britain and the USA. The CANCOM Group is led by Thomas Volk (CEO), Rudolf Hotter (COO) and Thomas Stark (CFO). The company is headquartered in Munich. CANCOM has an annual turnover of over one billion euros and its parent company, CANCOM SE, is listed on the TecDAX and SDAX of the Frankfurt Stock Exchange (ISIN DE0005419105).

Contact:
Sebastian Bucher
Manager Investor Relations

Phone: +49 89 54054 5193
Email: [email protected]