Worldline (1K) | Reduce | Reinitiating coverage

Research evidence excerpt

Worldline (1K) | Reduce | Reinitiating coverage

hould be more Consensus EPS 1.2 2.1 2.7

visible late 2026 and in 2027. Net dividend 0.00 0.00 0.00

Earnings will be released on 30 July, with H1 EBITDA (fully pruned) expected to FY to 31/12 (EUR) 12/26E 12/27E 12/28E

drop from EUR298m to EUR260m, with 2026 expected to be more backend loaded P/E adj and ful. dil. 3.0 2.5 2.2

than previous years, with more savings coming in H2 and slightly better sales. EV/EBITDA 2.7 2.5 2.2

EV/EBIT 5.6 4.7 4.0

Deconstructing the forecasts FCF yield -11.8% 5.5% 8.7%

We have Q2 revenues down 1.1% organic with 0.7% growth in MS and -7% in FS Dividend yield 0.0% 0.0% 0.0%

(Q1 was at -0.5%). FS sales contraction is expected to moderate during H2, helping ND(F+IFRS16)/EBITDA 1.9 1.7 1.5 Gearing 22.9% 22.1% 19.7%

the group to get to flat sales growth over FY26 (guidance low single digit growth). ROIC 6.9% 7.7% 8.8%

Our EUR637m EBITDA forecasts nevertheless stay within the EUR630m to EV/IC 0.5 0.5 0.5

EUR657m guidance. Sector Most Pref. Sector Least Pref.

Bechtle AtosWe have FCF returning to positive in 2027 when restructuring charges moderate Capgemini Cegedim

(EUR80m in 2026). Dassault Systèmes Softcat

Valuation and investment conclusion Tietoevry

Ambition is to deliver 4% sales growth CAGR over 2027-2030, which at this stage

remains a challenging target compared to the revenue stability seen in past

quarters and expected for the remainder of the year.

Investors are likely to focus on FCF generation going forward. While FCF of

Laurent Daure

EUR300m to EUR350m by 2030 would provide upside, given that we expect FCF to Head of IT services & software

stay below EUR100m till 2029 in our model, we see no rush playing a turnaround +33 1 53 65 36 36

ldaure@keplercheuvreux.com story.

IMPORTANT.