Zalaris (ZAL) investor relations material

Executive summary

• Achieved record Q3 revenue of NOK 375 million, up 10.3% year-over-year, with adjusted EBIT of NOK 47 million and a margin of 12.6%, driven by strong Managed Services and new contracts.

• Renewed long-term SAP partnership, migrating PeopleHub to SAP S/4HANA Cloud, ensuring platform support through 2040 and enabling future AI-driven innovation.

• Secured a EUR 40 million revolving credit facility, refinancing existing debt, reducing annual interest expenses, and increasing financial flexibility.

• Signed major new and renewed contracts across Europe, expanding client base and service scope, including deals in Germany and with major European clients.

Financial highlights

• Q3 revenue reached NOK 375 million, up 10.3% year-over-year; Managed Services revenue grew 14% to NOK 289 million, representing 77% of total revenue.

• Adjusted EBIT for Q3 was NOK 47 million, a 27% increase year-over-year, with a margin of 12.6%.

• Net profit for the period was NOK 18.9 million, up from NOK 8.3 million last year.

• Net operating cash flow for Q3 was NOK 10.9 million, down from NOK 48.4 million last year due to working capital timing and share option settlements.

• Net interest-bearing debt at quarter-end was NOK 244.7 million.

Outlook and guidance

• Projected revenue increase of more than 16% for 2025 and 2026 compared to 2024, based on signed contracts and new BPO deals.

• Ambition to reach NOK 2 billion in annualized revenue by Q4 2028 with an EBIT margin of 13%-15%.

• No significant obstacles anticipated to achieving target EBIT margin in 2026-2027.

• Profitability to improve via scaling, automation, and increased use of near/offshore centers.

• Expects continued revenue growth from long-term BPaaS/SaaS contracts and expansions, with 10% average annual revenue growth and 1.5-3% annual churn.