Summary of Key Points from the Conference Call Industry Overview - **Industry**: Global IT Services - **Current Outlook**: Downgraded to Cautious for the US IT Services industry, with Europe also seen as disadvantaged. India IT Services remains In-Line, while Latin America is expected to experience lower growth [12][30][20]. Core Insights - **AI Impact**: AI is prioritized in customer budgets, which is limiting spending on traditional IT services. This shift is expected to pressure returns on invested capital (ROIC) as companies invest in their own intellectual property (IP) [12][16][21]. - **ROIC Trends**: US IT Services ROIC has declined from 50% in 2016 to 22% in 2024, with projections indicating further downward pressure. The industry could see ROIC fall to low teens by 2030 under base case scenarios, and potentially to around 5% in bear cases [33][18][26]. - **Contract Pricing**: New contracts are incorporating AI-driven productivity enhancements, potentially reducing costs by 20-30% immediately, which shifts risks to IT Services companies [17][22]. Financial Adjustments - **Price Target Changes**: - Accenture Plc: Downgraded from $325 to $271 - EPAM Systems Inc: Downgraded from $210 to $175 - TaskUs, Inc.: Downgraded from Overweight to Equal-weight with a price target of $16.50 [14][13]. - **Valuation Pressures**: Despite significant share price declines (~14% YTD), the outlook remains cautious due to expected low growth rates and limited margin expansion [12][30]. Investment Dynamics - **M&A Activity**: The majority of future investments are expected to come from mergers and acquisitions (M&A), with a notable increase in M&A spend from $4.4 billion in 2022 to over $10 billion in 2024 [24][25]. - **Investment in IP**: Companies are expected to focus on developing their own IP through acquisitions and R&D, which may pressure ROIC in the near to mid-term [23][24]. Market Sentiment - **CIO Survey Insights**: The CIO survey indicates that while AI-related spending is increasing, it is often at the expense of other IT priorities, leading to a decline in the share of IT budgets allocated to traditional IT services [70][74]. - **Growth Expectations**: IT Services budget growth is projected at +2.5% for 2025, slightly down from previous expectations, indicating a cautious spending environment [74][75]. Additional Considerations - **Long-term Risks**: The long-term outlook for IT Services remains uncertain, with potential for further declines in ROIC and valuation pressures due to the competitive landscape and the need for significant investment in AI capabilities [26][30][18]. - **Regional Variations**: India IT Services are expected to maintain an In-Line view, with selective Overweight positions on certain companies due to relative valuations, while Latin America faces a lower growth outlook [20][32]. This summary encapsulates the critical insights and financial adjustments discussed in the conference call, highlighting the challenges and strategic shifts within the Global IT Services industry.

Core Viewpoint - Netcompany Group A/S has announced a share buyback programme of up to DKK 500 million to adjust its capital structure and fulfill obligations related to share-based incentive programmes [1] Group 1: Share Buyback Programme Details - The share buyback programme will conclude no later than 30 January 2026 [2] - The programme will be executed in compliance with EU Market Abuse Regulation and related provisions [2][3] - Danske Bank A/S has been appointed as the lead manager for the share buyback programme, making independent trading decisions on behalf of Netcompany [3] Group 2: Terms and Conditions - The maximum total consideration for shares bought back is set at DKK 500 million, with a maximum of 3,700,000 shares to be repurchased [6] - The maximum number of shares that can be purchased per daily market session is limited to 25% of the average daily trading volume over the preceding 20 trading days [6] - Shares cannot be repurchased at a price exceeding the higher of the last independent transaction price or the highest independent bid on Nasdaq Copenhagen A/S [6] Group 3: Current Holdings - As of the announcement date, Netcompany holds 369,510 treasury shares, which is equivalent to 0.8% of the total share capital [4]

Company Overview - Netcompany has completed the acquisition of SDC, valuing SDC at DKK 1 billion, with a cash payment of DKK 1 billion to SDC's shareholders [1][5] - The newly formed entity, Netcompany Banking Services A/S, will fully integrate SDC's operations, creating a subsidiary of Netcompany [5] Industry Position - This transaction provides Netcompany with a strong foothold in the financial services sector, which is the highest spending vertical within IT services in Europe [2] - The total addressable market in Denmark, Norway, and Sweden is estimated to exceed DKK 44 billion, with an expected annual growth rate of over 10% towards 2028 [2] Financial Guidance - For 2025, Netcompany maintains its organic revenue growth expectation between 5% and 10%, with an adjusted EBITDA margin between 16% and 19% [6] - The transaction is anticipated to have a dilutive impact on EPS for the financial year 2025 but is expected to be EPS accretive from 2026 onwards, with double-digit percentage accretion by 2028 compared to 2024 [5][10] Integration and Future Plans - All SDC employees will relocate to Netcompany's headquarters in Copenhagen starting January 2026 to facilitate integration [5] - Netcompany plans to disclose expected non-organic revenue and EBITDA for 2025 in the Q2 Interim Report, along with annual synergies and integration costs in the Q3 Interim Report [7][8] Shareholder Returns - Netcompany intends to reinitiate its share buyback program in connection with the Q2 Interim Report, with leverage expected to be around 1.5x by the end of 2025 [9] - The ambition to buy back shares totaling DKK 2 billion from 2024 to the end of 2026 remains intact, with revised long-term financial aspirations to be communicated on 31 October 2025 [10]

Group 1 - Danske Bank A/S has notified Netcompany Group A/S regarding their direct and indirect holdings and voting rights in the company [1][2] - As of June 11, 2025, Danske Bank A/S controls 2,587,150 voting rights, which corresponds to 5.45% of the total voting rights in Netcompany [2]

Core Points - Danske Bank A/S has reported a change in its direct and indirect holdings in Netcompany Group A/S, now holding 2,465,823 voting rights, which corresponds to 4.93% of the total voting rights in the company [2] - This represents a decrease from their previous holding of 5.00% [2] - The announcement is made in accordance with the Danish Capital Markets Act [3] Additional Information - For further inquiries, contact Thomas Johansen, CFO, or Frederikke Linde, Head of IR at Netcompany Group A/S [4]

Core Viewpoint - Netcompany Group A/S has received regulatory approvals for the merger with SDC, which aims to create a combined company fully owned by Netcompany to enhance banking services [1]. Group 1 - The merger is part of a strategic initiative to form a new entity that will focus on the future of banking services [1]. - The announcement regarding the merger was initially made on February 10, 2025, under company announcement no. 09/2025 [1]. - The closing of the merger is still subject to customary closing conditions as outlined in the previous announcement [1].