CANCOM SE — Earnings Release 2010

Mar 24, 2011

CANCOM AG Germany - IT Services

Buy (old: Buy)				23-March-11
	Price target: EUR 15.00	(old: EUR 15.00)		Tim Wunderlich Analyst
Price:	EUR 9.17	Next result:	FY 2010: 31.03.11
Bloomberg:	COK GR	Market cap:	EUR 76.9 m	tim.wunderlich@ha-research.de
Reuters:	COKG.DE	Enterprise Value:	EUR 72.9 m	Tel.: +49 40 4143885 81

Strategic partnership with IBM offers attractive potential; BUY

CANCOM announced it has entered into a long-term strategic partnership with global giant IBM to jointly market its private Cloud Computing solution to the German Mittelstand. This should include shared trade-fair appearances, customer events and road shows.

The agreement has come into existence following IBM's thorough analysis of CANCOM's Cloud solution, underscoring its technological sophistication. For customers, the Cloud's appeal lies in its ROI of less than one year as it cuts operating costs by rationalising IT infrastructure, i.e. reducing the number of needed computing centres. Facing competition only from visionapp, CANCOM's Cloud solution is virtually unrivalled in Germany.

The rationale for IBM to enter the deal is simple: it does not have a proprietary Cloud solution meeting the needs of small- and medium-sized enterprises but sees a bright future for this market as its clientele is increasingly taking a shine to the Cloud. Winning a tender, IBM will benefit by selling hardware and software as add-ons and using its consultants for project implementation. In our view, it does not get a share of the Cloud Computing software margin.

More importantly, the partnership is highly lucrative to CANCOM as customer wins should come naturally on the back of IBM's distribution clout and renowned brand. This is seen to mark a big step for CANCOM to achieve its target of increasing its Cloud client base tenfold to 100 by 2013E.

As a result, CANCOM will add a highly profitable business to its current set-up: With 100 customers, annual maintenance revenues could amount to € 12m, translating into EBITDA of € 8-10m per year as the business is very scalable. This is not included in our estimates and hence provides significant upside potential. According to CANCOM, first positive impacts from the partnership should already be felt in 2011E. Remains a clear BUY with an unchanged PT of € 15 based on DCF.

Y/E 31.12 (EUR m)	2007	2008	2009	2010	2011E	2012E	2013E
Sales	300.1	364.1	422.5	549.3	605.1	639.0	667.7
Sales growth	13 %	21 %	16 %	30 %	10 %	6 %	5 %
EBITDA	8.0	8.8	10.4	19.2	23.1	25.8	26.9
EBIT	6.2	5.4	7.0	13.7	17.1	19.3	20.3
Net income	4.7	2.7	5.1	7.9	10.1	11.7	12.6
Net debt	6.2	3.9	-3.5	-1.5	-4.0	-12.0	-19.8
Net gearing	17.2 %	9.9 %	-8.0 %	-3.0 %	-7.0 %	-18.4 %	-27.3 %
Net Debt/EBITDA	0.8	0.4	0.0	0.0	0.0	0.0	0.0
EPS fully diluted	0.45	0.36	0.49	0.87	0.97	1.12	1.21
CPS	0.40	1.03	0.71	1.24	0.60	1.21	1.29
DPS	0.00	0.00	0.15	0.27	0.39	0.51	0.61
Dividend yield	0.0 %	0.0 %	2.0 %	3.5 %	5.2 %	6.7 %	8.1 %
Gross profit margin	28.8 %	29.1 %	27.5 %	27.6 %	27.2 %	27.9 %	27.9 %
EBITDA margin	2.7 %	2.4 %	2.5 %	3.5 %	3.8 %	4.0 %	4.0 %
EBIT margin	2.1 %	1.5 %	1.6 %	2.5 %	2.8 %	3.0 %	3.0 %
ROCE	10.6 %	8.5 %	10.3 %	17.7 %	19.4 %	20.1 %	19.7 %
EV/sales	0.3	0.2	0.2	0.1	0.1	0.1	0.1
EV/EBITDA	10.5	9.4	7.1	3.9	3.2	2.5	2.1
EV/EBIT	13.7	15.3	10.6	5.5	4.3	3.4	2.8
PER	16.1	28.2	15.4	9.9	7.7	6.7	6.2
Adjusted FCF yield	6.7 %	6.4 %	8.6 %	15.4 %	20.5 %	26.3 %	32.1 %

Source: Company data, Hauck & Aufhäuser Close price as of: 22.03.2011

Source: Company data, Hauck & Aufhäuser

High/low 52 weeks:	11.40 / 5.28
Price/Book Ratio:	1.7
Relative performance (TecDAX):
3 months	-8.0 %
6 months	12.8 %
12 months	39.5 %

Changes in estimates

		Sales	EBIT	EPS
	old:	605.1	17.1	0.97
2011 ∆	-	-	-
	old:	639.0	19.3	1.12
2012	∆	-	-	-
	old:	667.7	20.3	1.21
2013	∆	-	-	-

Key share data:

Number of shares: (in m pcs)	10.4
Authorised capital: (in € m)	4.0
Book value per share: (in €)	5.5
Ø trading volume: (12 months)	60,000

Major shareholders:

Free Float	84.8 %
JP Morgan	5.3 %
AGI	3.0 %
Stefan Kober	2.5 %
Raymond Kober	2.5 %
Klaus Weinmann	1.9 %

Company description:

CANCOM is the 3rd largest independent system house and IT hardware reseller in Germany.

Financials

Profit and loss (EUR m)	2007	2008	2009	2010	2011E	2012E	2013E
Net sales	300.1	364.1	422.5	549.3	605.1	639.0	667.7
Sales growth	13.2 %	21.3 %	16.0 %	30.0 %	10.2 %	5.6 %	4.5 %
Increase/decrease in finished goods and work-in-process	0.9	0.3	1.0	0.7	1.0	1.0	1.0
Total sales	301.0	364.5	423.4	550.0	606.1	640.0	668.8
Other operating income	1.5	1.7	2.7	1.9	2.1	2.2	2.3
Material expenses	214.2	258.3	306.8	398.0	441.2	461.6	482.4
Personnel expenses	59.0	73.0	82.8	103.4	111.7	121.5	127.0
Other operating expenses	21.2	26.1	26.1	31.3	32.2	33.3	34.8
Total operating expenses	293.0	355.7	413.1	530.8	583.0	614.2	641.8
EBITDA	8.0	8.8	10.4	19.2	23.1	25.8	26.9
Depreciation	1.4	1.4	2.4	2.9	3.4	3.7	3.6
EBITA	6.6	7.4	7.9	16.3	19.7	22.1	23.3
Amortisation of goodwill	0.0	1.0	0.1	1.2	0.0	0.0	0.0
Amortisation of intangible assets	0.5	1.0	0.9	1.4	2.6	2.8	3.0
Impairment charges	0.0	0.0	0.0	0.0	0.0	0.0	0.0
EBIT	6.2	5.4	7.0	13.7	17.1	19.3	20.3
Interest income	0.2	0.3	0.2	0.2	0.2	0.2	0.2
Interest expenses	1.0	1.6	1.5	2.1	2.6	2.6	2.6
Other financial result	0.0	-0.1	0.0	0.0	-0.2	-0.1	0.0
Financial result	-0.9	-1.3	-1.3	-1.9	-2.6	-2.5	-2.4
Recurring pretax income from continuing operations	5.3	4.0	5.7	11.8	14.5	16.8	18.0
Extraordinary income/loss	0.0	0.0	0.0	0.0	0.0	0.0	0.0
Earnings before taxes	5.3	4.0	5.7	11.8	14.5	16.8	18.0
Taxes	-0.1	1.3	0.6	3.9	4.4	5.0	5.4
Net income from continuing operations	5.4	2.8	5.1	7.9	10.2	11.7	12.6
Result from discontinued operations (net of tax)	0.2	0.1	0.0	0.0	0.0	0.0	0.0
Net income	5.2	2.7	5.1	7.9	10.2	11.7	12.6
Minority interest	0.5	0.0	0.0	0.0	0.1	0.1	0.0
Net income (net of minority interest)	4.7	2.7	5.1	7.9	10.1	11.7	12.6
Average number of shares	10.4	10.4	10.4	10.4	10.4	10.4	10.4
EPS reported	0.45	0.26	0.49	0.76	0.97	1.12	1.21

Profit and loss (common size)	2007	2008	2009	2010	2011E	2012E	2013E
Net sales	100.0 %	100.0 %	100.0 %	100.0 %	100.0 %	100.0 %	100.0 %
Increase/decrease in finished goods and work-in-process	0.3 %	0.1 %	0.2 %	0.1 %	0.2 %	0.2 %	0.2 %
Total sales	100.3 %	100.1 %	100.2 %	100.1 %	100.2 %	100.2 %	100.2 %
Other operating income	0.5 %	0.5 %	0.6 %	0.3 %	0.3 %	0.3 %	0.3 %
Material expenses	71.4 %	70.9 %	72.6 %	72.5 %	72.9 %	72.2 %	72.2 %
Personnel expenses	19.7 %	20.1 %	19.6 %	18.8 %	18.5 %	19.0 %	19.0 %
Other operating expenses	7.1 %	7.2 %	6.2 %	5.7 %	5.3 %	5.2 %	5.2 %
Total operating expenses	97.6 %	97.7 %	97.8 %	96.6 %	96.3 %	96.1 %	96.1 %
EBITDA	2.7 %	2.4 %	2.5 %	3.5 %	3.8 %	4.0 %	4.0 %
Depreciation	0.5 %	0.4 %	0.6 %	0.5 %	0.6 %	0.6 %	0.5 %
EBITA	2.2 %	2.0 %	1.9 %	3.0 %	3.3 %	3.5 %	3.5 %
Amortisation of goodwill	0.0 %	0.3 %	0.0 %	0.2 %	0.0 %	0.0 %	0.0 %
Amortisation of intangible assets	0.2 %	0.3 %	0.2 %	0.3 %	0.4 %	0.4 %	0.4 %
Impairment charges	0.0 %	0.0 %	0.0 %	0.0 %	0.0 %	0.0 %	0.0 %
EBIT	2.1 %	1.5 %	1.6 %	2.5 %	2.8 %	3.0 %	3.0 %
Interest income	0.1 %	0.1 %	0.0 %	0.0 %	0.0 %	0.0 %	0.0 %
Interest expenses	0.3 %	0.4 %	0.3 %	0.4 %	0.4 %	0.4 %	0.4 %
Other financial result	0.0 %	0.0 %	0.0 %	0.0 %	0.0 %	0.0 %	0.0 %
Financial result	-0.3 %	-0.4 %	-0.3 %	-0.3 %	-0.4 %	-0.4 %	-0.4 %
Recurring pretax income from continuing operations	1.8 %	1.1 %	1.3 %	2.1 %	2.4 %	2.6 %	2.7 %
Extraordinary income/loss	0.0 %	0.0 %	0.0 %	0.0 %	0.0 %	0.0 %	0.0 %
Earnings before taxes	1.8 %	1.1 %	1.3 %	2.1 %	2.4 %	2.6 %	2.7 %
Tax rate	-1.1 %	31.4 %	9.8 %	33.0 %	30.0 %	30.0 %	30.0 %
Net income from continuing operations	1.8 %	0.8 %	1.2 %	1.4 %	1.7 %	1.8 %	1.9 %
Income from discontinued operations (net of tax)	0.1 %	0.0 %	0.0 %	0.0 %	0.0 %	0.0 %	0.0 %
Net income	1.7 %	0.7 %	1.2 %	1.4 %	1.7 %	1.8 %	1.9 %
Minority interest	0.2 %	0.0 %	0.0 %	0.0 %	0.0 %	0.0 %	0.0 %
Net income (net of minority interest)	1.6 %	0.7 %	1.2 %	1.4 %	1.7 %	1.8 %	1.9 %

Balance sheet (EUR m)	2007	2008	2009	2010	2011E	2012E	2013E
Intangible assets	25.7	28.3	31.5	39.9	38.8	37.5	36.0
Property, plant and equipment	3.0	5.4	6.5	7.6	8.2	8.5	8.9
Financial assets	0.2	3.5	0.2	2.4	2.4	2.4	2.4
FIXED ASSETS	28.9	37.3	38.2	50.0	49.5	48.5	47.4
Inventories	8.6	10.1	12.6	14.5	16.4	17.3	18.0
Accounts receivable	39.3	44.2	47.2	56.4	66.3	70.0	73.2
Other current assets	1.5	6.3	5.1	5.1	5.1	5.1	5.1
Liquid assets	11.8	18.3	25.8	31.5	34.0	42.0	49.8
Deferred taxes	3.1	2.5	2.6	2.6	2.6	2.6	2.6
Deferred charges and prepaid expenses	7.4	2.1	3.4	3.4	3.4	3.4	3.4
CURRENT ASSETS	71.5	83.4	96.7	113.4	127.7	140.3	152.1
TOTAL ASSETS	100.4	120.7	134.9	163.5	177.2	188.8	199.5
SHAREHOLDERS EQUITY	36.3	38.9	43.9	50.2	57.5	65.2	72.6
MINORITY INTEREST	0.0	0.0	0.0	0.0	0.1	0.2	0.2
Long-term debt	16.1	20.3	21.6	29.2	29.2	29.2	29.2
Provisions for pensions and similar obligations	0.2	0.2	0.0	0.0	0.0	0.0	0.0
Other provisions	7.9	3.2	4.3	4.3	4.3	4.3	4.3
Non-current liabilities	24.1	23.6	26.0	33.6	33.6	33.6	33.6
short-term liabilities to banks	1.9	1.8	0.7	0.7	0.7	0.7	0.7
Accounts payable	27.5	39.3	47.9	62.5	68.8	72.7	75.9
Advance payments received on orders	0.8	2.0	1.1	1.1	1.1	1.1	1.1
Other liabilities (incl. from lease and rental contracts)	6.6	12.6	10.7	10.7	10.7	10.7	10.7
Deferred taxes	0.7	1.3	2.0	2.0	2.0	2.0	2.0
Deferred income	2.5	1.2	2.7	2.7	2.7	2.7	2.7
Current liabilities	40.0	58.1	65.0	79.6	86.0	89.8	93.1
TOTAL LIABILITIES AND SHAREHOLDERS EQUITY	100.4	120.7	134.9	163.5	177.2	188.8	199.5

Balance sheet (common size)	2007	2008	2009	2010	2011E	2012E	2013E
Intangible assets	25.6 %	23.5 %	23.4 %	24.4 %	21.9 %	19.9 %	18.1 %
Property, plant and equipment	3.0 %	4.5 %	4.8 %	4.7 %	4.6 %	4.5 %	4.5 %
Financial assets	0.2 %	2.9 %	0.1 %	1.5 %	1.4 %	1.3 %	1.2 %
FIXED ASSETS	28.8 %	30.9 %	28.3 %	30.6 %	27.9 %	25.7 %	23.8 %
Inventories	8.5 %	8.4 %	9.3 %	8.9 %	9.2 %	9.1 %	9.0 %
Accounts receivable	39.1 %	36.6 %	35.0 %	34.5 %	37.4 %	37.1 %	36.7 %
Other current assets	1.5 %	5.2 %	3.8 %	3.1 %	2.9 %	2.7 %	2.6 %
Liquid assets	11.7 %	15.1 %	19.2 %	19.2 %	19.2 %	22.2 %	25.0 %
Deferred taxes	3.1 %	2.1 %	1.9 %	1.6 %	1.4 %	1.4 %	1.3 %
Deferred charges and prepaid expenses	7.3 %	1.7 %	2.5 %	2.1 %	1.9 %	1.8 %	1.7 %
CURRENT ASSETS	71.2 %	69.1 %	71.7 %	69.4 %	72.1 %	74.3 %	76.2 %
TOTAL ASSETS	100.0 %	100.0 %	100.0 %	100.0 %	100.0 %	100.0 %	100.0 %
SHAREHOLDERS EQUITY	36.1 %	32.3 %	32.5 %	30.7 %	32.5 %	34.5 %	36.4 %
MINORITY INTEREST	0.0 %	0.0 %	0.0 %	0.0 %	0.1 %	0.1 %	0.1 %
Long-term debt	16.0 %	16.9 %	16.0 %	17.9 %	16.5 %	15.5 %	14.7 %
Provisions for pensions and similar obligations	0.2 %	0.1 %	0.0 %	0.0 %	0.0 %	0.0 %	0.0 %
Other provisions	7.9 %	2.6 %	3.2 %	2.7 %	2.5 %	2.3 %	2.2 %
Non-current liabilities	24.0 %	19.6 %	19.3 %	20.6 %	19.0 %	17.8 %	16.9 %
short-term liabilities to banks	1.9 %	1.5 %	0.5 %	0.4 %	0.4 %	0.4 %	0.4 %
Accounts payable	27.4 %	32.5 %	35.5 %	38.2 %	38.8 %	38.5 %	38.1 %
Advance payments received on orders	0.8 %	1.6 %	0.8 %	0.7 %	0.6 %	0.6 %	0.6 %
Other liabilities (incl. from lease and rental contracts)	6.6 %	10.4 %	7.9 %	6.5 %	6.0 %	5.7 %	5.4 %
Deferred taxes	0.7 %	1.1 %	1.5 %	1.2 %	1.1 %	1.0 %	1.0 %
Deferred income	2.5 %	1.0 %	2.0 %	1.6 %	1.5 %	1.4 %	1.3 %
Current liabilities	39.9 %	48.2 %	48.2 %	48.7 %	48.5 %	47.6 %	46.7 %
TOTAL LIABILITIES AND SHAREHOLDERS EQUITY	100.0 %	100.0 %	100.0 %	100.0 %	100.0 %	100.0 %	100.0 %

Cash flow statement (EUR m)	2007	2008	2009	2010	2011E	2012E	2013E
Net profit/loss	5.2	2.7	5.1	7.9	10.2	11.7	12.6
Depreciation of fixed assets (incl. leases)	1.4	1.4	2.4	2.9	3.4	3.7	3.6
Amortisation of goodwill	0.0	1.0	0.1	1.2	0.0	0.0	0.0
Amortisation of intangible assets	0.5	1.0	0.9	1.4	2.6	2.8	3.0
Others	0.0	6.4	-0.2	0.0	0.0	0.0	0.0
Cash flow from operations before changes in w/c	7.0	12.5	8.3	13.4	16.2	18.2	19.2
Increase/decrease in inventory	0.2	-4.0	1.3	-1.9	-1.9	-0.9	-0.8
Increase/decrease in accounts receivable	-3.5	-4.8	1.1	-9.2	-9.9	-3.7	-3.2
Increase/decrease in accounts payable	1.3	-0.1	-1.1	14.6	6.3	3.9	3.3
Increase/decrease in other working capital positions	1.0	9.5	1.1	0.0	0.0	0.0	0.0
Increase/decrease in working capital	-1.1	0.5	2.4	3.5	-5.4	-0.8	-0.7
Cash flow from operating activities	6.0	13.1	10.7	16.9	10.8	17.5	18.5
CAPEX	4.2	3.2	4.7	5.5	5.5	5.5	5.5
Payments for acquisitions	4.7	3.0	-1.4	9.5	0.0	0.0	0.0
Financial investments	-0.1	-3.0	-0.6	2.3	0.0	0.0	0.0
Income from asset disposals	3.5	2.0	0.1	0.0	0.0	0.0	0.0
Cash flow from investing activities	-5.4	-1.2	-2.6	-17.3	-5.5	-5.5	-5.5
Cash flow before financing	0.6	11.9	8.0	-0.4	5.3	4.0	5.2
Increase/decrease in debt position	4.8	-4.4	0.3	7.6	0.0	0.0	0.0
Purchase of own shares	0.0	0.0	0.2	0.0	0.0	0.0	0.0
Capital measures	0.0	0.0	0.0	0.0	0.0	0.0	0.0
Dividends paid	0.0	0.0	0.0	1.6	2.7	4.0	5.2
Others	-0.8	-0.1	-1.2	0.0	0.0	0.0	0.0
Effects of exchange rate changes on cash	-0.2	-0.3	0.0	0.0	0.0	0.0	0.0
Cash flow from financing activities	4.0	-4.5	-1.1	6.1	-2.7	-4.0	-5.2
Increase/decrease in liquid assets	4.5	7.1	7.0	5.6	2.5	n/a	n/a
Liquid assets at end of period	11.8	18.9	25.8	31.5	34.0	42.0	49.8

Source: Company data, Hauck & Aufhäuser

Regional split (EUR m)	2007	2008	2009	2010	2011E	2012E	2013E
Domestic	0.0	322.2	386.1	510.0	566.0	598.0	624.0
yoy change	n/a	n/a	19.8 %	32.1 %	11.0 %	5.7 %	4.3 %
Rest of Europe	0.0	0.0	36.4	39.3	39.1	41.0	43.7
yoy change	n/a	n/a	n/a	8.0 %	-0.5 %	4.8 %	6.7 %
NAFTA	0.0	0.0	0.0	0.0	0.0	0.0	0.0
yoy change	n/a	n/a	n/a	n/a	n/a	n/a	n/a
Asia Pacific	0.0	0.0	0.0	0.0	0.0	0.0	0.0
yoy change	n/a	n/a	n/a	n/a	n/a	n/a	n/a
Rest of world	0.0	0.0	0.0	0.0	0.0	0.0	0.0
yoy change	n/a	n/a	n/a	n/a	n/a	n/a	n/a
TTL	0.0	322.2	422.5	549.3	605.1	639.0	667.7
yoy change	n/a	n/a	31.1 %	30.0 %	10.2 %	5.6 %	4.5 %

Key ratios (EUR m)	2007	2008	2009	2010	2011E	2012E	2013E
P&L growth analysis
Sales growth	13.2 %	21.3 %	16.0 %	30.0 %	10.2 %	5.6 %	4.5 %
EBITDA growth	38.7 %	9.1 %	18.4 %	85.3 %	20.3 %	11.6 %	4.5 %
EBIT growth	44.7 %	-13.0 %	29.8 %	97.0 %	24.8 %	12.8 %	5.5 %
EPS growth	85.5 %	-42.5 %	87.9 %	55.7 %	28.2 %	15.5 %	7.8 %
Efficiency
Total operating costs / sales	97.6 %	97.7 %	97.8 %	96.6 %	96.3 %	96.1 %	96.1 %
Sales per employee	233.3	229.3	237.7	281.7	292.3	297.2	301.8
EBITDA per employee	6.2	5.5	5.8	9.8	11.2	12.0	12.2
Balance sheet analysis
Avg. working capital / sales	6.2 %	4.5 %	2.8 %	1.6 %	1.7 %	2.1 %	2.1 %
Inventory turnover (sales/inventory)	35.1	36.1	33.6	37.9	37.0	37.0	37.0
Trade debtors in days of sales	47.8	44.3	40.8	37.5	40.0	40.0	40.0
A/P turnover [(A/P*365)/sales]	33.5	39.3	41.3	41.5	41.5	41.5	41.5
Cash conversion cycle (days)	15.5	3.1	-1.2	-6.5	-3.4	-3.8	-3.8
Cash flow analysis
Free cash flow	1.8	9.9	6.0	11.4	5.3	12.0	13.0
Free cash flow/sales	0.6 %	2.7 %	1.4 %	2.1 %	0.9 %	1.9 %	1.9 %
FCF / net profit	38.0 %	367.4 %	118.4 %	144.2 %	52.1 %	102.6 %	103.5 %
FCF yield	2.3 %	12.7 %	7.7 %	14.8 %	6.8 %	15.6 %	16.9 %
Capex / depn	221.5 %	4.0 %	120.4 %	141.9 %	91.7 %	84.6 %	83.3 %
Capex / maintenance capex	84.3 %	105.9 %	98.6 %	97.6 %	87.0 %	80.0 %	75.5 %
Capex / sales	1.4 %	0.0 %	1.0 %	1.4 %	0.9 %	n/a	n/a
Security
Net debt	6.2	3.9	-3.5	-1.5	-4.0	-12.0	-19.8
Net Debt/EBITDA	0.8	0.4	0.0	0.0	0.0	0.0	0.0
Net debt / equity	0.2	0.1	-0.1	0.0	-0.1	-0.2	-0.3
Interest cover	6.0	3.4	4.7	6.5	6.6	7.4	7.8
Dividend payout ratio	0.0 %	0.0 %	30.7 %	34.6 %	39.5 %	44.5 %	49.4 %
Asset utilisation
Capital employed turnover	4.8	5.7	6.0	6.5	6.6	6.4	6.2
Operating assets turnover	13.3	19.7	24.4	36.7	28.9	29.0	28.9
Plant turnover	99.4	67.4	64.7	72.0	73.5	74.9	74.8
Inventory turnover (sales/inventory)	35.1	36.1	33.6	37.9	37.0	37.0	37.0
Returns
ROCE	10.6 %	8.5 %	10.3 %	17.7 %	19.4 %	20.1 %	19.7 %
ROE	12.9 %	6.9 %	11.5 %	15.7 %	17.5 %	17.9 %	17.3 %
Other
Interest paid / avg. debt	6.6 %	7.8 %	6.6 %	8.0 %	8.7 %	8.7 %	8.7 %
No. employees (average)	1287	1588	1777	1950	2070	2150	2213
Number of shares	10.4	10.4	10.4	10.4	10.4	10.4	10.4
DPS	0.0	0.0	0.2	0.3	0.4	0.5	0.6
EPS reported	0.45	0.26	0.49	0.76	0.97	1.12	1.21
Valuation ratios
P/BV	2.1	2.0	1.8	1.6	1.4	1.2	1.1
EV/sales	0.3	0.2	0.2	0.1	0.1	0.1	0.1
EV/EBITDA	10.5	9.4	7.1	3.9	3.2	2.5	2.1
EV/EBITA	12.7	11.1	9.3	4.6	3.7	2.9	2.4
EV/EBIT	13.7	15.3	10.6	5.5	4.3	3.4	2.8
EV/FCF	47.3	8.3	12.3	6.6	13.8	5.4	4.4
Dividend yield	0.0 %	0.0 %	2.0 %	3.5 %	5.2 %	6.7 %	8.1 %

Disclosure in respect of section 34b of the German Securities Trading Act (Wertpapierhandelsgesetz – WpHG)

Company	Disclosure
CANCOM AG	2

(1) Hauck & Aufhäuser or its affiliate(s) was Lead Manager or Co-Lead Manager over the previous 12 months of a public offering of this company.

(2) Hauck & Aufhäuser acts as Designated Sponsor for this company or offers Equity Advisory Services.

• (3) Over the previous 12 months, Hauck & Aufhäuser and/or its affiliate(s) has effected an agreement with this company for investment banking services or received compensation or a promise to pay from this company for investment banking services.
• (4) Hauck & Aufhäuser and/or its affiliate(s) holds 5 % or more of the share capital of this company.
• (5) Hauck & Aufhäuser holds a trading position in shares of this company.
• (6) Hauck & Aufhäuser and/or its affiliate(s) holds a net short position of 1 % or more of the share capital of this company, calculated by methods required by German law as of the last trading day of the past month.
• (7) Within the last five years Hauck & Aufhäuser was a member of the issuing syndicate of this company.
• (8) The research report has been made available to the company prior to its publication / dissemination. Thereafter, only factual changes have been made to the report

Historical target price and rating changes for CANCOM AG in the last 12 months

Valuation basis/rating key

Buy: Sustainable upside potential of more than 10% within 12 months.

Hold 23.08 % 33.33 %

Sell: Sustainable downside potential of more than 10% within 12 months.

Hold: Upside/downside potential limited. No immediate catalyst visible.

Competent supervisory authority

Bundesanstalt für Finanzdienstleistungsaufsicht – BaFin – (Federal Financial Supervisory Authority), Graurheindorfer Straße 108, 53117 Bonn and Lurgiallee 12, 60439 Frankfurt am Main, Germany

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8 Hauck & Aufhäuser Institutional Research