CANCOM SE — Investor Presentation 2013

May 17, 2013

Deutsche Bank Markets Research

Rating Hold

Europe Germany

Technology IT Software & Services

Q1-13 review

Company

Cancom Alert

Reuters Bloomberg Exchange Ticker COKG.DE COK GR GER COKG

Prelims confirmed

Cancom confirmed its Q1-13 pre-released results on 15 May. Revenue of EUR 135m were down by 4% yoy. The EBITDA of EUR 7m was flat yoy. EPS of EUR 0.28 improved slightly yoy due to an exceptionally high tax rate in Q1-12. After an initial profit warning in March, Q1 ended strongly driven by a better-thanexpected IT Solutions segment and a significant profitability increase in E-Commerce. After the recent share price run-up we think the market fully values recent improvements. This report transfers coverage of Cancom from Benjamin Goy to Uwe Schupp, effective immediately.

IT Solutions: flat revenue, E-Commerce: focus on profitability

IT Solutions posted revenue of EUR 104m, flat yoy. The EBITDA margin was largely stable at 6.1%. The shortage of qualified employees hampers sales growth in IT Solutions since Cancom has to qualify its employees in a timeconsuming process. Additionally, start-up costs of cloud projects do not instantly translate into revenue due to the long-term character of cloud solution contracts. In E-Commerce the company continues to sacrifice revenue for more profitable business. Sales declined by 18% yoy but the EBITDA margin improved by 1.5pp to 7.1%. Overall, encouraging trends but already priced into the share price in our view.

Solid results but focus was on shareholder structure recently

While the operating business improved after a weak January and February, we think the recent share price performance has been driven by the 10% stake acquired by Karin Schick end of April. Karin Schick is the daughter of Bechtle founder Gerhard Schick and the largest shareholder (35% stake) of Cancom's main competitor Bechtle. In an interview given in early May Mr Schick hints that he sees himself as a 'long-term anchor shareholder' who is interested in diversifying his net worth in an industry he knows well. While we cannot rule out a further stake increase by Mr Schick in Cancom with the ultimate intention to create a dominant IT Service player in Germany we think that in the short-term the main desire is to take out some price pressure in a market which has clearly become more difficult since the middle of last year. Additionally, the 10% stake exacerbates a potential takeover of Cancom by an international player.

Deutsche Bank AG/London

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Date 17 May 2013 Coverage Change

Price at 17 May 2013 (EUR)	17.38
Price Target (EUR)	13.00
52-week range (EUR)	17.35 - 10.78

Uwe Schupp, CFA Benjamin Goy

Research Analyst	Research Analyst
(+49) 69 910-31955	(+49) 69 910-31946
uwe.schupp@db.com	benjamin.goy@db.com

Stock & option liquidity data Market cap (EUR)(m) 198.7 Shares outstanding (m) 11 Free float (%) 81 Key data FYE 12/31 2012A 2013E 2014E Revenue (EURm) 558 570 597 DB PBT (EURm) 19 21 23 Stated PBT (EURm) 19 21 23 DB EPS (EUR) 1.10 1.26 1.39 DPS (EUR) 0.35 0.40 0.45 P/E (DB EPS) (x) 10.9 13.8 12.5

Deutsche Bank does and seeks to do business with companies covered in its research reports. Thus, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.THE VIEWS EXPRESSED ABOVE ACCURATELY REFLECT PERSONAL VIEWS OF THE AUTHORS ABOUT THE SUBJECT COMPANY(IES) AND ITS(THEIR) SECURITIES. THEY HAVE NOT AND WILL NOT RECEIVE ANY COMPENSATION FOR PROVIDING A SPECIFIC RECOMMENDATION OR VIEW IN THIS REPORT. FOR OTHER DISCLOSURES PLEASE VISIT http://gm.db.com/ger/disclosure/Disclosure.eqsr?ricCode=COKG.DE MICA(P) 054/04/2013.