QUARTERLY STATEMENT Q3 2023

Table of key figures

CANCOM GROUP

in € million	9M 2023	9M 2022
Revenue	1,062.9	925.1	+ 14.9 %
Business volume	1,377.3	1,214.8	+ 13.4 %
Gross profit	406.9	321.0	+ 26.8 %
EBITDA	76.6	80.0	- 4.3 %
EBITDA margin	7.2 %	8.6 %	- 1.4 pp
EBITA	39.3	46.0	- 14.6 %
EBIT	33.3	42.7	- 22.0 %
Employees (average)	5,055	3,739	+ 35.2 %

in € million	30.09.2023	31.12.2022
Balance sheet total	1,508.8	1,305.1	+ 15.6 %
Equity	744.6	694.8	+ 7.2 %
Equity ratio	49.4 %	53.2 %	- 3.8 pp
Cash and cash equivalents	180.4	393.2	- 54.1 %

GERMANY

in € million	9M 2023	9M 2022
Revenue	829.3	843.4	- 1.7 %
EBITDA	53.0	68.9	- 23.1 %
EBITDA margin	6.4 %	8.2 %	- 1.8 pp

INTERNATIONAL

in € million	9M 2023	9M 2022
Revenue	233.5	81.6	+ 186.1 %
EBITDA	23.6	11.1	+ 113.0 %
EBITDA margin	10.1 %	13.6 %	- 3.5 pp

4 Fundamentals of the Group
5 Economic report
11 Forecast report
14 Consolidated balance sheet
16 Consolidated Statement of total comprehensive Income
19 Consolidated cash flow statement
20 Segment information

Interim Group Report

For the period from 1 January to 30 September 2023

FUNDAMENTALS OF THE GROUP

The CANCOM Group (hereinafter referred to as "CANCOM" or "CANCOM Group") is one of the leading providers of IT services and IT infrastructure in Germany and Austria. In addition to its activities in the aforementioned core markets, the Group has subsidiaries or branches in Switzerland, Slovakia, the Czech Republic, Romania, Belgium and the USA.

Structure of the CANCOM Group

The parent company of the CANCOM Group is CANCOM SE, based in Munich, Germany. It performs centralised financing and management functions for the Group companies, i.e. the investments it holds. In addition to the central management and financing activities of the parent company, the operating units are also supported in their daily business operations by centralised departments for purchasing, internal IT, warehousing/logistics, finance, vehicle and travel management, repair/service and human resources ("Central Services") as well as marketing/communication and product management. In addition, the operating units have access to an internal, specialised sales department ("Competence Center") across the entire organisation.

In addition to these centralised functions, CANCOM's operating units are primarily decentralised and operate in units that are primarily structured by region. The organisation comprises the regional units South, Southwest, Central, East, North and West as well as locations in Slovakia, Austria and Belgium. In addition, there are the supra-regional business units Managed Services, Public and eCommerce.

KBC Beteiligungs GmbH, based in Vienna, has been a wholly owned subsidiary of CANCOM SE since 7 June 2023. The subsidiary continues to fulfil the central financing and management functions for the subsidiaries of K-Businesscom AG. The company has branches in Austria and subsidiaries in the Czech Republic, Romania, Switzerland, the USA and Germany.

In its financial reporting, the CANCOM Group uses two segments in addition to the Group as a whole to report on its operating business performance: "Germany" and "International".

Reportable segments

The companies of the CANCOM Group with their registered office in Germany form the operating segment "Germany". Accordingly, all companies of the CANCOM Group based outside Germany are summarised in the "International" segment. The companies allocated to each segment based on their company head office can be found in the list of shareholdings published in the notes to the consolidated interim report of the CANCOM Group as at 30 June 2023.

Business model and sales markets

CANCOM's product and service offering is geared towards advising and supporting corporate customers and public sector clients in adapting IT infrastructures and processes to the requirements of digitalisation. CANCOM acts as a complete solution provider and sees itself as a hybrid IT service provider for the customer.

The range of services extends from strategic consulting for digital (business) processes to the partial or complete operation of IT systems (primarily by means of managed services and standardised as-a-service offerings), through to system design and integration, IT support, delivery and turnkey implementation of hardware and software, e-procurement and logistics services.

This broad-based product and service offering enables the CANCOM Group to generate revenue both on the basis of the Company's own capabilities and services (service business) and from remuneration and commissions for the sale of third-party IT products (sale of goods). Within this business model, management is pursuing a course of strategic transformation of the CANCOM Group into a hybrid IT service provider, in which the provision of IT services is to account for an increasing proportion of business activities.

In geographical terms, the CANCOM Group is primarily active in Germany and Austria. It also has market access in Switzerland, Romania, the USA and Belgium. CANCOM Group subsidiaries are active in Slovakia and the Czech Republic, providing services in the areas of service and support centres and software customisation and development.

A key external factor influencing CANCOM's business development is therefore the development of the IT market in the largest markets of Germany and Austria. For these markets as a whole - and therefore also for CANCOM - the general trend towards digitalisation is a key driver of development. The importance of IT processes in business, education, healthcare and administration is increasing. New applications for IT-supported solutions and investments to improve existing infrastructures are contributing to market development.

Important external factors beyond CANCOM's control that can have a positive or negative impact on business development include, in particular, data protection regulations, the general threat situation in the area of cyber security and the quality certifications required by customers, as well as environmental and social standards. As a provider of IT services and products, the CANCOM Group's business model is not subject to any particular industry-specific legal provisions, authorisation requirements or official supervision, i.e. external regulatory or politically influenced factors that go beyond the statutory regulations that generally apply to all companies. In addition, the availability of IT hardware and software on the global market is an external factor that cannot be influenced.

The CANCOM Group's customer base primarily comprises commercial end users, ranging from small and medium-sized enterprises to large companies and corporations, as well as public institutions.

ECONOMIC REPORT

Germany is the most important market for the CANCOM Group, accounting for over 75 percent of revenue. The most important foreign market is Austria. In addition to the general economic development in these national markets, the overall market for information and communication technology (ICT) - especially in Germany - also forms an important framework and basis for comparison when assessing CANCOM's economic development.

Germany

The Federal Statistical Office assumes that gross domestic product (GDP) in Germany fell by 0.1 percent in the third quarter of 2023 compared to the previous quarter. Growth of 0.1 percent was recorded in the second quarter of 2023. In the first quarter, economic development measured by GDP stagnated at +/- 0.0 percent compared to the previous quarter. Continued high inflation, a lower propensity to consume on the part of private households and falling spending by the public sector weighed

on economic development. Shortly after the end of the reporting period, the International Monetary Fund (IMF) adjusted its annual GDP forecast for Germany and now expects GDP to fall by 0.5 percent in 2023 compared to the prior year.

Austria

In Austria, CANCOM's most important foreign market, GDP in the third quarter was 0.6 percent lower than in the second quarter, according to the European statistics authority Eurostat. A decline of 0.8 percent was also recorded in the second quarter. Growth was only recorded in the first quarter of the year.

Gross domestic product (GDP) 2023*

(change compared to previous quarter in %)

	Q1 2023	Q2 2023	Q3 2023
Deutschland	+/- 0.0	+ 0.1	- 0.1
Österreich	+ 0.1	- 0.8	- 0.6

*) Source: Eurostat, October 2023.

ITC market

The expectations of the industry association Bitkom for the development of the ICT market in Germany, the CANCOM Group's most important market, weakened over the course of the first half of 2023. Nevertheless, Bitkom expects growth of 3.0 percent for the information technology market segment, which is particularly important for the CANCOM Group. The software and IT services submarkets are also expected to develop positively over the course of the year. Here, Bitkom expects growth of 9.6 percent and 5.3 percent respectively. Expectations in the IT hardware market segment are much gloomier. Here, Bitkom expects a decline of 3.6 percent over the year as a whole. The survey from July is only of limited value due to the time lag between this quarterly statement and the developments since the summer. Most recently, general economic data such as GDP development was slightly more positive than expected in the summer.

Outlook: Market for information technology (IT) 2023, Germany* (change compared to prior year in %)

*) Source: Bitkom/IDC, July 2023.

According to the UBIT Radar published by KMU Forschung Austria, companies in the IT sector in Austria expected the information technology market to develop positively at the beginning of 2023. 65.0 percent of companies expected business performance in the 2023 financial year to be good or better than in the same period of the prior year. The average expectation for revenue growth in the current financial year was 10.8 percent. The informative value of the figures for the business expectations of the Austrian market has also decreased due to the time lag between the publication of this quarterly statement and the publication of this quarterly statement. Nevertheless, the forecast high growth rates mean that the market can be expected to develop positively overall.

Business performance in the first nine months of 2023

In the reporting period from 1 January to 30 September 2023, the CANCOM Group generated revenue of € 1,062.9 million (prior year: € 925.1 million). A significant part of this very positive development was the acquisition of the KBC Group, which was included in the scope of consolidation as at 1 June 2023. The Germany segment generated revenue of € 829.3 million in the reporting period (prior year: € 843.4 million). Revenue in the International segment, which also includes the majority of the KBC Group's contribution, totalled € 233.5 million (prior year: € 81.6 million).

Revenue growth at Group level amounted to 14.9 percent. In Germany, the CANCOM Group's core market, demand weakened in the first nine months, particularly in the areas of e-commerce and workplace infrastructure. By contrast, business in the CANCOM Group's Consulting, Support Services and Managed Services / XaaS segments developed positively.

The CANCOM Group's EBITDA was negatively impacted by one-off effects and totalled € 76.6 million after the first nine months of 2023 (prior year: € 80.0 million). Higher costs due to inflation led to a decline in profitability. Non-recurring effects in connection with the efficiency and profitability programme and expenses in connection with the acquisition of K-Businesscom had an impact of around € 10.2 million on EBITDA.

Order situation

At the beginning of the first quarter of 2023, the order backlog was well above the historical level. The main reason for this development was the continued limited availability of IT hardware, which caused the order backlog to rise sharply. The

order backlog fell at the end of the first quarter and over the course of the second quarter, as the availability of IT hardware improved significantly on the one hand and customers became increasingly cautious, particularly in the area of IT hardware, on the other. At the end of the second quarter, the CANCOM Group had an order backlog in the trading sector that was at a normal level for the CANCOM Group.

However, the order situation does not reflect all of the CANCOM Group's business transactions. This is due to the customary contractual structure of many orders. They often cover longer periods in which the volume can vary (framework agreements). However, there can also be very short periods between the order and the realisation of revenue. Reporting on order volumes is therefore not meaningful and is therefore not included in the CANCOM Group's financial reports.

Employees of the CANCOM Group

As at 30 September 2023, the CANCOM Group employed 5,532 people (30 September 2022: 3,826). This corresponds to an increase of 44.6 percent compared to the prior year's reporting date.

The employees worked in the following areas:

CANCOM Group: Employees

	30.09.2023	30.09.2022
Professional Services	3,667	2,314
Sales	948	838
Central services	917	674
Total	5,532	3,826

The average number of employees in the first nine months of 2023 was 5,055 (prior year period: 3,738 employees).

The very significant growth on the reporting date can be explained by the acquisition of the KBC Group. As at the reporting date of 30 September 2023, the KBC Group employed 1,657 people. 1,213 of them work in Professional Services, 172 in Sales and 272 in Central Services.

Earnings situation, financial position and net assets of the CANCOM Group

Earnings situation

CANCOM Group: Revenue (in € million)
9M 2023	1,062.9
9M 2022	925.1

In the first nine months of the financial year, the CANCOM Group generated consolidated revenue of € 1,062.9 million (prior year: € 925.1 million). In organic terms1 , i.e. excluding the contribution of companies consolidated for less than 12 months, revenue totalled € 876.8 million. In the reporting period, CANCOM generated € 697.8 million (prior year: € 651.9 million) from the sale of goods, in particular hardware and software, and € 365.1 million (prior year: € 273.1 million) from the provision of services.

In the Germany segment, which covers the business activities of all companies in the CANCOM Group based in Germany, revenue in the reporting period totalled € 829.3 million (prior year: € 843.4 million). Organic revenue totalled € 808.4 million. In the International segment, which comprises the companies of the CANCOM Group that are not based in Germany, revenue rose to € 233.5 million (prior year: € 81.6 million). Organic sales in the segment totalled € 67.8 million.

In the third quarter of 2023, the CANCOM Group generated revenue of € 415.8 million (prior year: € 329.6 million). The Germany segment generated revenue of € 264.8 million (prior year: € 299.8 million). Sales in the International segment rose to € 151.0 million in the third quarter (prior year: € 29.8 million).

The CANCOM Group's business volume2 , i.e. before the application of IFRS 15 with transactions categorised as principal (gross disclosure) or agent (net disclosure), amounted to € 1,377.3 million in the first nine months (prior year: € 1,214.8 million). In the third quarter, the business volume totalled € 506.4 million (prior year: € 410.4 million).

The CANCOM Group's other operating income fell to € 8.0 million in the first nine months of 2023 (prior year: € 11.4 million). In the third quarter, other operating income totalled € 4.6 million (prior year: € 4.8 million).

The CANCOM Group's total operating performance totalled € 1,072.7 million in the first three quarters (prior year: € 941.6 million). In the third quarter, total operating performance totalled € 421.1 million (prior year: € 335.8 million).

CANCOM Group: Cost of materials

(in € million)
	9M 2023	9M 2022
Cost of materials/expenses for
purchased services	-665.8	-620.5

The cost of materials totalled € 665.8 million in the first nine months (prior year: € 620.5 million). In the third quarter, the cost of materials totalled € 259.4 million (prior year: € 226.8 million).

CANCOM Group: Gross profit (in € million) 9M 2023 406.9 9M 2022 321.0

The CANCOM Group's gross profit3 increased by 26.7 percent year-on-year to € 406.9 million in the first three quarters of 2023 (prior year: € 321.0 million). Organic gross profit totalled € 323.2 million. The gross profit margin rose to 38.3 percent in the reporting period (prior year: 34.7 percent). In the Group segment Germany, gross profit rose by 7.6 percent to € 317.2 million in the reporting period (prior year: € 294.7 million). Gross profit, which was generated organically, totalled € 305,7 million. In the International Group segment, CANCOM recorded gross profit of € 99.3 million (prior year: € 27.7 million). € 27.1 million of the gross profit was generated organically.

The third quarter of 2023 generated consolidated gross profit of € 161.7 million (prior year: € 109.1 million). Gross profit in the Germany segment rose to € 103.2 million in the third quarter (prior year: € 99.4 million). Gross profit in the International segment totalled € 61.8 million in the third quarter (prior year: € 10.1 million).

1 Organic share of key financial figures = respective key financial figure (GAAP or non-GAAP) contributions from companies that have been part of the scope of consolidation for less than 12 months
2 Business volume = Revenue before adjustment according to IFRS 15 (principal/agent classification); corresponds to accounting before 2020

Explanation of the Alternative Performance Measures (APM) used in accordance with the APM guidelines of the European Securities and Markets Authority (ESMA):

³ Gross profit = total operating performance (sales revenue + other operating income + other own work capitalised + capitalised contract costs) less cost of materials/expenses for purchased services

CANCOM Group: Personnel expenses

(in € million)

	9M 2023	9M 2022
Wages and salaries	-226.4	-169.8
Social security contributions	-44.3	-30.3
Equity-settled share-based payments	0	0.1
Expenses for retirement benefits	-1.4	-0.3
Share-based payments with cash settlement	-0.3	-0.1
Total	-272.4	-200.4

Personnel expenses totalled € 272.4 million in the first nine months of 2023 and were therefore higher than in the same period of the prior year (prior year: € 200.4 million). The personnel expenses ratio was 25.6 percent (prior year: 21.7 percent).

In the third quarter of 2023, personnel expenses amounted to € 106.1 million (prior year: € 64.8 million) and the personnel expense ratio was 25.5 percent (prior year: 19.7 percent).

Other operating expenses totalled € 58.2 million in the first three quarters of 2023 (prior year: € 39.8 million). For the third quarter, other operating expenses totalled € 20.7 million (prior year: € 14.8 million).

CANCOM Group: EBITDA (in € million)
9M 2023	76.6
9M 2022	80.0

After the first three quarters of 2023, the CANCOM Group's EBITDA4 totalled € 76.6 million (prior year: € 80.0 million). Organic EBITDA totalled € 56.6 million.

EBITDA in the Germany segment totalled € 53.0 million after nine months (prior year: € 68.9 million). Organic EBITDA totalled € 49.6 million. In the International segment, EBITDA totalled € 23.6 million (prior year: € 11.1 million) and organic EBITDA amounted to € 7.0 million.

In the third quarter of 2023, the CANCOM Group's EBITDA totalled € 35.0 million (prior year: € 28.9 million).

EBITDA in the Group's Germany segment totalled € 20.6 million in the third quarter (prior year: € 24.4 million). EBITDA in the International segment totalled € 14.4 million in the third quarter (prior year: € 4.5 million).

CANCOM Group: EBITDA margin (in %)

In the reporting period from January to September 2023, the CANCOM Group's EBITDA margin was 7.2 percent (prior year: 8.6 percent).

The EBITDA margin in the Germany segment was 6.4 percent in the reporting period (prior year: 8.2 percent). The EBITDA margin in the International segment was 10.1 percent (prior year: 13.6 percent).

In the third quarter of 2023, the EBITDA margin of the CANCOM Group was 8.4 percent (prior year: 8.8 percent). In the Germany segment, the EBITDA margin for the third quarter was 7.8 percent (prior year: 8.1 percent) and in the International segment it was 9.5 percent (prior year: 15.1 percent).

CANCOM Group: Depreciation and amortisation (in € million)

	9M 2023	9M 2022
Scheduled depreciation of property, plant and equipment	9.9	10.3
Scheduled amortisation of software	13.1	13.3
Scheduled amortisation of right-of-use assets	14.2	10.4
Scheduled amortisation on customer bases etc.	6.0	3.3
Impairment of goodwill	0.0	0.0
Total	43.2	37.2

Depreciation and amortisation rose to € 43.2 million in the reporting period (prior year: € 37.2 million). In the third quarter, depreciation and amortisation reached € 20.7 million (prior year: € 15.0 million).

The CANCOM Group's EBITA5 totalled € 39.3 million in the first nine months of the current financial year (prior year: € 46.0 million).

Explanation of the Alternative Performance Measures (APM) used in accordance with the APM guidelines of the European Securities and Markets Authority (ESMA):

⁴ EBITDA = Profit/loss for the period + income taxes + currency gains/losses + depreciation/amortisation of financial assets + income from investments + other financial result + interest result + depreciation/amortisation of property, plant and equipment, intangible assets and right-of-use assets

⁵ EBITA = profit for the period + income taxes + currency gains/losses + amortisation of financial assets + income from investments + other financial result + net interest income + amortisation of intangible assets resulting from company acquisitions (in particular customer bases, order backlogs)

EBITA in the Germany segment totalled € 21.1 million in the reporting period (prior year: € 35.8 million). In the International segment, on the other hand, EBITA totalled € 18.3 million (prior year: € 10.2 million).

In the third quarter, the CANCOM Group achieved EBITA of € 20.5 million (prior year: € 15.1 million). In the Group segment Germany, EBITA totalled € 9.7 million (prior year: € 10.9 million) and in the International segment € 10.7 million (prior year: € 4.2 million).

The CANCOM Group's EBIT6 totalled € 33.3 million in the first three quarters of the current financial year (prior year: € 42.7 million).

EBIT in the Germany segment totalled € 18.5 million in the reporting period (prior year: € 32.5 million) and EBIT in the International segment was € 14.8 million (prior year: € 10.2 million).

The CANCOM Group's EBIT for the third quarter of 2023 totalled € 16.9 million (prior year: € 13.9 million). EBIT in the Germany segment totalled € 8.7 million (prior year: € 9.7 million). By contrast, EBIT in the International segment totalled € 8.2 million (prior year: € 4.2 million).

CANCOM Group: Profit for the period
(in € million)

9M 2023		24.9
9M 2022		27.3

As a result of the first nine months of 2023, the CANCOM Group's net profit for the period totalled € 24.9 million (prior year: € 27.3 million).

In the third quarter of 2023, the CANCOM Group's net profit for the period totalled € 10.4 million (prior year: € 7.2 million).

Financial position and net assets

Principles and objectives of financial management

The core objective of CANCOM's financial management is to ensure liquidity at all times in order to guarantee day-to-day business operations. In addition, the aim is to optimise profitability and thus achieve the highest possible credit rating in order to secure favourable refinancing. The financing structure is primarily geared towards long-term stability and maintaining financial room for manoeuvre in order to exploit business and investment opportunities.

Capital structure of the Group

The CANCOM Group's total assets amounted to € 1,508.8 million as at the reporting date of 30 September 2023 (31 December 2022: € 1,305.1 million). Of this amount, € 744.6 million was attributable to equity and € 610.3 million to liabilities. The equity ratio of the CANCOM Group was therefore 49.3 percent at the end of September and thus below the level at the end of the 2022 financial year (31 December 2022: 53.2 percent). The debt ratio rose accordingly to 50.7 percent (31 December 2022: 46.8 percent). The shift in the balance sheet structure compared to December 2022 resulted primarily from the consolidation of K-Businesscom. As at 31 December 2022, there were no non-current liabilities to banks. Current financial liabilities to banks increased due to the assumption of liabilities from K-Businesscom and decreased in the reporting period. As at 30 September 2023, current liabilities to banks amounted to € 17.6 million (31 December 2022: € 0 million). Cash and cash equivalents as at the reporting date of 30 September 2023 cover this level of interest-bearing financial liabilities. As a result, the Group has no net financial debt and this key figure is negative ("net cash" situation).

Debt and equity

Current liabilities, i.e. liabilities with a remaining term of less than one year, totalled € 544.4 million as at the reporting date of 30 September 2023 (31 December 2022: € 479.8 million). The change compared to December 2022 is due to the increase in current liabilities to banks to € 17.6 million (31 December 2022: € 0 million), other current financial liabilities, which rose to € 83.2 million (31 December 2022: € 60.0 million), and current contract liabilities, which increased to € 53.2 million (31 December 2022: € 28.6 million). Trade payables decreased and amounted to € 315.4 million as at 30 September 2023 (31 December 2022: € 326.0 million).

Explanation of the Alternative Performance Measures (APM) used in accordance with the APM guidelines of the European Securities and Markets Authority (ESMA): 6 EBIT = profit for the period + income taxes + currency gains/losses + amortisation of financial assets + income from investments + other financial result + interest result At € 219.8 million as at the reporting date, non-current liabilities were significantly higher than the level on 31 December 2022 (31 December 2022: € 130.5 million). The main factor here was an increase in other non-current financial liabilities, which amounted to € 154.1 million as at the reporting date of the third quarter (31 December 2022: € 103.0 million). Non-current pension provisions and similar provisions increased to € 22.4 million (31 December 2022: € 1.1 million), also in connection with the acquisition of K-Businesscom, and deferred tax liabilities reached € 20.8 million (31 December 2022: € 11.7 million).

At € 744.6 million, equity was higher than the comparative figure as at the reporting date (31 December 2022: € 694.8 million). The increase is due to the higher capital reserve, which amounted to € 471.9 million on 30 September 2023 (31 December 2022: € 380.0 million). At € 235.6 million, retained earnings including profit carried forward and profit for the period were below the year-end figure (31 December 2022: € 279.6 million).

Significant financing measures

Current business and necessary replacement investments were financed from cash and cash equivalents and operating cash flow in the reporting period. The same applies to all other investments.

Assets

The assets side of the balance sheet showed current assets of € 890.7 million as at 30 September 2023 (31 December 2022: € 958.7 million). Cash and cash equivalents fell to € 180.4 million in the first nine months of 2023 (31 December 2022: € 393.2 million). The change in cash and cash equivalents was mainly influenced by the payment in connection with the acquisition of K-Businesscom. Trade receivables increased only slightly in the first nine months to € 414.2 million (31 December 2022: € 409.2 million). Current contract assets increased significantly to € 70.2 million (31 December 2022: € 1.7 million). Inventories also grew to € 115.0 million as at 30 September 2023 (31 December 2022: € 83.0 million).

Non-current assets amounted to € 618.1 million as at 30 September 2023 (31 December 2022: € 346.4 million). Changes occurred primarily in intangible assets, which amounted to € 89.0 million at the end of the third quarter (31 December 2022: € 57.4 million). Goodwill increased significantly to € 256.6 million as at 30 September 2023 (31 December 2022: € 125.2 million) due to the acquisition of K-Businesscom. Investments in companies accounted for using the equity method totalled € 15.1 million.

Cash flow and liquidity

Based on a result for the period of € 24.9 million (prior year: € 27.3 million), the cash flow from operating activities for the reporting period from January to September 2023 amounted to € -9.9 million (prior year: € -169.7 million). This significant improvement is due to the reduction in trade receivables, contract assets, capitalised contract costs and other assets in the amount of € 72.1 million (prior year: € -120.2 million). The lower increase in inventories of € -25.8 million (prior year: € -71.3 million) continued to have a positive effect. In contrast, the lower trade payables and other liabilities in the reporting period of € -111.1 million (prior year: € -39.0 million) had a negative impact.

Cash flow from investing activities in the first nine months of 2023 totalled € -101.8 million (prior year: € -33.4 million). The main influencing factor was the payments for the acquisition of subsidiaries, primarily in connection with the acquisition of KBC Beteiligungs GmbH and its subsidiaries. The corporate transaction led to payments of € -95.7 million less cash and cash equivalents acquired totalling € 12.1 million. The purchase price share of € 95.5 million from the non-cash capital increase was non-cash. Payments for investments in property, plant and equipment, intangible assets and right-of-use assets totalled € -18.1 million in the reporting period (prior year: € -23.2 million).

At € -100.6 million, cash flow from financing activities in the reporting period was below the figure for the same period of the prior year (prior year: € -164.9 million). In the comparative period, the figure was significantly influenced by the payment of € -117.4 million for the buyback of treasury shares as part of CANCOM SE's 2021/22 share buyback programme. In the reporting period, € -33.7 million was spent on the buyback of treasury shares as part of the 2023/2024 share buyback programme.

In the first nine months, there was therefore a decrease in cash and cash equivalents of € 212.4 million compared to cash and cash equivalents at the beginning of the financial year. Cash and cash equivalents amounted to € 180.4 million as at 30 September 2023 (31 December 2022: € 393.2 million).

As a result, the CANCOM Group had a positive balance of cash and cash equivalents at the balance sheet date and was able to draw on unused credit lines with financial institutions at the balance sheet date of this interim report. The CANCOM Group is therefore in an exceptionally strong position to meet its payment obligations at all times.

Overall statement on the net assets, financial position and results of operations of the CANCOM Group

In the first three quarters of 2023, the CANCOM Group generated revenue of € 1,062.9 million and EBITDA of € 76.6 million. An EBITDA margin of 7.2 percent was therefore achieved. The development of the CANCOM Group was significantly accelerated by the very positive contribution of the KBC Group.

The CANCOM Group's earnings, financial and asset situation remains good. However, the Executive Board's aim is to achieve profitable growth for the CANCOM Group as a whole; accordingly, the Executive Board is not entirely satisfied with the CANCOM Group's performance in the first nine months of the financial year.

Events after the end of the reporting period

There were no significant events for the CANCOM Group after the reporting period.

Risks and opportunities of future development

In the reporting period, there were no significant changes to the published assessment of the opportunities and risks relating to the future development of the CANCOM Group. This is particularly the case as the effects of current geopolitical developments and the risks of weaker economic development were already assessed as "high" in the risk report of the 2022 Annual Report under the risk item "Economic and (geo)political risks".

Following the acquisition of the KBC Group in June 2023, the KBC Group's risk and opportunity inventory was analysed and consolidated during the reporting period. Minor adjustments were required to the risk items "Project and business-related risks", "Strategic risks" and the risk item "Economic, regulatory, market and sector-related risks".

The adjustments led to individual changes in loss potentials and probabilities of occurrence. Only the risk cluster "project risks", which falls into the risk category "project and business-related risks", resulted in an overall risk adjustment from "low" to "medium".

The CANCOM Group's existing risk inventory was also reviewed for plausibility and consistency during the reporting period. In future, the risk of SAP implementation will be considered in the area of internal risks due to current developments and progress and will no longer be managed as a separate risk cluster. The overall assessment of internal risks remains unaffected by this, but the damage potential increases to a "medium" rating.

The CANCOM Group's risks are limited, both individually and in interaction with other risks, and do not currently jeopardise the continued existence of the company in any way.

FORECAST REPORT

Premises of the forecast

The forecasts for the CANCOM Group and CANCOM SE include all information known to the Executive Board at the time this report was prepared that could have an impact on business development. The outlook is based, among other things, on the expectations described below with regard to economic development and the development of the IT market.

With regard to the CANCOM Group as a whole and the individual markets represented in the Group segments, unforeseeable events could influence the expected development of the company or individual Group segments from today's perspective. Such events include, for example, the consequences of short-term legal or regulatory changes. Such events are not taken into account in the forecast.

The forecast developments in the key financial performance indicators relate to the development of the CANCOM Group in its Group structure as at the reporting date of 31 December 2022 (scope of consolidation), taking into account the integration of the business activities of the KBC Group as at 1 June 2023.

Development of the overall economy and the IT market

Overall economy

With a revenue share of around 75 percent, Germany is the most important market for the CANCOM Group. The most important foreign market is Austria. GDP is currently expected to decline in both markets in 2023.

Outlook for gross domestic product 2023* (change from prior year in %)
Germany	- 0.5
Austria	- 0.2

*) Source: Deutsche Bank Research, October 2023

The economic outlook for both national markets deteriorated over the course of the third quarter. In Germany, the decline for the year as a whole is now more pronounced than had been expected in the summer. The forecast for Austria has also been revised and now assumes a decline in GDP for the year as a whole.

In addition to the general economic development in these national markets, the overall market for information and communication technology - especially in Germany and Austria - also forms an important framework and basis for comparison when assessing the economic development of the CANCOM Group.