Netcompany raises 2026 revenue growth floor to 18% on strong UK growth
Key Facts
On 29 October, Netcompany raised the lower end of its forecast for group revenue growth in fiscal 2026 to 18%, from 16% previously, while keeping the upper end at 20.5%, the company said. It cited revenue growth of 28.1% in the first nine months of the year, along with its current order backlog and weighted opportunity pipeline. Excluding Netcompany Banking Services, it raised the lower end to 8.5% from 6.5%, while the upper end remained at 10.5%. The revision reflects an improved floor for the full-year outlook, while maintaining a distinction between the group's overall performance and its banking business. The company left its adjusted EBITDA margin guidance unchanged.
Group revenue rose 8.1% to 2,343.8 million Danish kroner in the third quarter compared with the same period in 2025, or 7.6% at constant currencies, the company said. The quarterly increase was slower than the 28.1% growth recorded in the first nine months, putting the outlook update in the context of performance accumulated since the start of the year. The UK was the standout market, with Netcompany's business there growing by more than 42% in the third quarter. Chief Executive Andre Rogaczewski said the company's offerings align with Europe's largest information technology services market and that interest in them is growing among public- and private-sector organisations. This UK growth gives the outlook regional momentum, but remains a figure specific to the third quarter.
Netcompany's partnership with NHS England provides a concrete backdrop to its expansion in Britain. In September, the company announced a five-year partnership worth more than 215 million pounds sterling, covering all seven national adult screening programmes, with about 15 million invitations a year. The programmes include breast, cervical and bowel cancer screening, and the company's partners pledged to direct at least 33% of contract revenue to small and medium-sized enterprises. The company said the services would be owned and controlled by the NHS and built in the UK. The work includes operating and developing existing digital services, as well as building a new national breast screening service and upgrading the cervical screening service with digital invitations and access to at-home HPV testing.
In Britain, the preliminary composite purchasing managers' index for private-sector activity rose to 53.1 in October from 52.0 in September, marking the fastest growth since February, according to S&P Global. The institution said services activity expanded at a faster pace and new service orders posted their largest monthly increase since August of the previous year. Companies also increased hiring for the first time since September 2024, while business confidence remained below its long-term average. Price pressures, meanwhile, remained elevated, the survey showed. On inflation, the Associated Press reported that consumer prices rose 3.5% year on year in September, compared with 3.1% in August, exceeding economists' forecast of 3.4%.
Netcompany kept its adjusted EBITDA margin guidance at about 16% to 19% for the group, and 17% to 20% for the group excluding its banking services. Cash flow, however, highlights a more strained aspect of the third-quarter results: free cash flow recorded a deficit of 170.6 million Danish kroner, compared with a deficit of 55.5 million in the third quarter of 2025, according to figures cited by Investing.com. Days sales outstanding rose to 61 days from 53 days a year earlier. Leverage stood at 2.4 times in the third quarter. The report also said the group's revenue visibility, excluding Netcompany Banking Services, was about 7.4 billion Danish kroner, up 10.5% year on year.
The balance between raised guidance and cash-flow pressure was reflected in the share's trading on 29 October. Netcompany shares fell 7.39% to 366 dollars, from a previous close of 395.2 dollars, according to an Investing.com report, which linked the decline to investors' focus on cash-flow and working-capital pressures. In UK monetary policy, the Monetary Policy Committee meeting was scheduled for 5 November, and no decision had yet been announced. S&P Global said markets had fully priced in a 25 basis-point increase to 4% at that meeting, while an AP report said most economists expected the key interest rate to rise to 4% after inflation picked up. These remain market and economist expectations, not an announced Bank of England decision.