ISS A/S (ISS) Earnings Call Transcript & Summary

Welcome to ISS Annual Report 2025 Presentation. Today's call is being recorded. If you have any objections to this, please disconnect your phone lines. [Operator Instructions] Today's speakers will be CEO, Kasper Fangel; and CFO, Mads Holm. First, I would like to hand it over to Head of Investor Relations, Michael Vitfell-Rasmussen. Michael, please begin.

Thank you very much, and good morning, everyone, and welcome to our conference call. We appreciate you joining us today to discuss our 2025 results, which were released earlier this morning. As said, I'm Michael Vitfell-Rasmussen, heading up Investor Relations here at ISS. Joining me in the room today is our CEO, Kasper Fangel; our CFO, Mads Holm; and Anne Sophie Riis from the IR team. Before we begin, please take a quick view at the disclaimer, and then I will hand it over to Kasper to start the presentation. Please move to Slide #4.

Thank you, Michael, and good morning, everyone. We appreciate you taking the time to join us as we review our results for the full year 2025. Looking back on the year, we strengthened the business across the board and delivered solid progress on all strategic priorities. I'll share more details on that in the next slide. Our financial results ended in line with expectations, and we saw an uptick in commercial momentum driven by our strategic investments and our relentless focus on sustainable growth. While there's still work ahead of us, we're encouraged by the continuous improvements we are making and the growing momentum across the business. We concluded the year with 25 contract announcements, and I'm pleased to report that 22 of those were positive. This lays a strong foundation for a successful 2026 and increases our revenue growth quality as we become less dependent on pricing alone. Additionally, I'm pleased to share that we have started the year with positive momentum with a solid and encouraging pipeline. In 2026, we expect an organic growth of above 5%, with a greater contribution from net new wins and volume, a margin above 5% and an underlying cash conversion above 60%. As it is well known to all of you, we maintain a stringent and disciplined approach in prioritizing how we allocate capital. And as a part of our continued commitment to deliver value to our shareholders, we are pleased to announce a new share buyback program of DKK 2.5 billion. In 2025, we successfully completed 2 smaller bolt-on acquisitions, strengthening our local presence in Spain and Austria. These acquisitions have already started delivering synergies and are adding value to ISS. Looking ahead to 2026, we'll continue to assess each potential target in details while maintaining flexibility to prioritize share buybacks when they offer the best return for our shareholders. The final oral hearing in the arbitration proceedings took place in mid July 2025. The parties await a ruling by the Tribunal, and have, in parallel, engaged in discussions on a potential settlement, which aim at settling disputed claims, creating clarity on contractual positions going forward and further strengthening the collaboration and partnership between ISS and Deutsche Telekom. We expect a final outcome in the first half of 2026. And I appreciate that you're all eager to hear more details, but I know you will appreciate that this is a sensitive commercial matter, so we won't be able to provide further details. As you already know, late in '25, there was a tragic incident at a customer site in Hong Kong. This devastating event resulted in the loss of life, and we are deeply saddened by it. My thoughts and deepest condolences go out to everyone affected by this tragedy, including the families and the broader community. We stand with them during this incredible difficult time. Please turn to Slide 6 for a view of our strategic initiatives. Back in December 2024, we launched the next phase of our strategy, sharpening our focus on what matters most to our customers. As you may recall, we clarified our 4 targeted group segments and identified 3 core customer needs that guide our execution. One, customer experience; two, sustainability; and three, efficiency. Price and sustainability are fundamental to our license to operate, but our true differentiator is delivering an exceptional customer experience. When we get this right, we grow with our customers, help bring people back to the workplace and create a compelling and sticky value proposition through consistently high-quality service delivery. To deliver on this, we focus on 3 priorities: one, group commercial operating model; becoming two, the leading frontline employer; and three, driving efficiency. These are supported by 8 global initiatives, where we see significant scale benefits from building capabilities at group level and deploying them consistently across countries. Let me briefly highlight some of the 8 initiatives where we made strong progress this year. We have implemented a new commercial operating model that sharpens how we win and scale global and regional customers. As a result, we are seeing improvements in pipeline quality, internationalization of major accounts and win rates. Through our partnership with the U.K.-based social value portal, we can now measure and demonstrate our community impact. Five countries completed full assessment in 2025 with 5 more planned for 2026, all with impressive outcomes in terms of the social value we deliver in those countries. At the same time, by the end of 2025, almost 140,000 recognized qualifications will have been achieved by our placemakers and their families since 2022, strengthening capability and retention. We're also modernizing our recruitment with AI-driven tools improving both speed and quality, which is especially important in today's tight labor markets and will help reduce turnover over time. We continue to advance our workforce management program, improving productivity across key markets. We now have clear best practices and country road maps in place, which we expect will drive further gains. We're also progressing well with the transition of local finance activities to our Finance Shared Service Center in Poland and remain on track for our 2026 European markets. Overall, we're executing with discipline across all 3 priorities, strengthening our commercial foundation and investing in our people and improving efficiency. We look forward to sharing more details at our Capital Markets Day later this year. Since our last update, we continue doing what we do best, helping our customers create exceptional service moments at their workplaces. Our focus remains clear, delivering outstanding customer experiences every day, driven by our self-delivery model and a strong service mindset. You're all familiar with this slide by now, and it clearly illustrates that our strategic efforts are paying off. We are seeing growth in existing customers, which is a lower risk, high-impact way to expand as we already understand their needs, and they trust what ISS stands for. We continue to target our 4 core segments for new business, but we remain open to local segments if the business case is compelling. These core segments represent the greatest opportunities globally for future growth at ISS. Not only do we have deep expertise in these areas, but they are also where our value proposition truly resonates. And the results are clear. The demand for workplace experience is increasing. Our 2025 announcement, combined with our '26 pipeline make me confident that 2026 will be a year where we will grow revenues with higher quality. Let's turn to the next slide, please. Over the last couple of years, our organic growth has primarily been driven by price increases, particularly due to our exposure to Turkey. While net new wins have been negatively impacted by contract trimming and exits mainly for strategic reasons. Over the last year, we've improved our portfolio to a 2025 exit position, which is positive from an underlying growth perspective, something that we have not seen in recent years. And going forward, we believe that our increased focus will continue to secure growth with our existing customers and add new customers to the portfolio. As you can see, we've significantly improved our net new and volume growth, and we remain committed to continuing this through continued focus, including making the right commercial investments. Looking ahead to our growth algorithm for '26 and beyond, I expect both volume and net new wins to become a higher contributor, while pricing will likely stabilize as inflation pressure ease. I'll go into more detail on this at our upcoming Capital Markets Day. Next slide, please. Before I conclude the business update. I want to address our maturity profile. I'm pleased that we have secured our 2 largest big-ticket items in '25. As you know, One was in the U.S., which also included an expansion though under DKK 100 million. In 2025, we only experienced 1 contract loss above DKK 100 million. And just recently, we lost another contract in early '26. The latter is a perfect example of a contract we don't intend to renew where the commercial terms simply became unattractive. ISS will only engage in contracts where the financials make sense or where there is a strategic benefit to the business. Let me be clear that the latter is the exception, not the rule. We closed the year with a retention rate of 94%. And while this is an improvement from '24, we are working hard to improve that number. It's critical that we stay focused and proactive on all expirations, regardless of size. Finally, I'd like to highlight our 2026 maturity profile. The contracts up for renewal in '26 are more fragmented than those in '25 with fewer big-ticket items and less dependency. But let me emphasize, this doesn't mean less importance nor focus. Every contract is important to ISS and a top priority for us. And now I will hand over to Mads for an update on our financials.

Thank you, Kasper. And now a few words on the financials. In the past 3 years, we've grown our top line by more than DKK 10 billion and significantly improved our EPS. This year, we delivered 9% EPS growth, further demonstrating our robust financial performance and delivering exactly as promised. Our fourth quarter ended on a solid note with financial metrics meeting expectations and delivering full year results accordingly. The organic growth ended at 4.1% in the fourth quarter, while the organic growth for the full year of 2025 amounted to 4.3%, a decrease compared to 2024, driven by a tough comparison base from the one-off restoration work in North America. As expected, our underlying performance improved in the second half of 2025 with an operating margin of 5.8%, offset by ongoing investments in the business. This brings our full year operating margin to just above 5% for the year. Our cash flow delivered ahead of plans with DKK 2.7 billion of free cash flow for the full year, supported by a DKK 200 million prepayment, but also driven by higher underlying quality. Please proceed to the next slide for a breakdown of the regional performance. All regions, except the Americas delivered positive organic growth in the fourth quarter, in line with our expectations. In Northern Europe, we recorded fourth quarter organic growth of 5.3%, supported by the start-up of DWP, offset by announced contract loss and a scope reduction both in the U.K. I would also like to highlight a strong and broad above-base performance across the region. We continue to see strong growth in Central and Southern Europe. The fourth quarter ended at 12.5%, primarily driven by price increases in Turkey. Additionally, we saw solid growth in above-base and positive contribution from net new wins. In Asia and Pacific, we delivered organic growth of 7%, with particularly strong performance in Pacific, India and Singapore, driven by new contract startups and volume growth with existing customers. As a reminder, roughly half of the contracts announced in 2025 originated from APAC. Finally, performance in the America was as expected. The main headwind came from the restoration work in the U.S. in connection with the hurricane last year. Excluding the restoration work, U.S. came in flat in the quarter. Furthermore, the region faces a headwind from contract exits in U.S. and Mexico from last year. At our upcoming Capital Markets Day, we will provide a deep dive into our U.S. business and share insights on our strategy going forward, but I'm pleased to see underlying stabilization in the business and the large retention, including a small scope increase in the U.S. in the later part of fourth quarter. Next slide, please. For the full year, we delivered organic growth of 4.3%, driven primarily by successful implementation of price increases, which contributed by around 4.5%. Turkey was slightly below half of that increase. As you may recall, we adjusted our organic growth guidance in connection with the third quarter due to a contract exit and timing of new contract start-ups. Therefore, our growth algorithm had a neutral like-for-like contribution for the full year, but I'm very pleased to see the underlying like-for-like improvement 2 percentage points in fourth quarter versus third quarter. In the fourth quarter, net new was positively impacted by the startup of DWP, Velux and a contract win in Central and Southern Europe, while there was a headwind from the before mentioned contract loss in the U.K. Volume growth in the fourth quarter was positively impacted by the Brisbane Airport start-up in fourth quarter, alongside other contract launches earlier in the year. However, it was negatively affected by the announced scope reduction in fourth quarter 2025 in the U.K. Above-base revenue for the quarter ended at minus 2%, impacted by significant headwinds from last year's hurricane-related restoration work in the Americas, while we saw an improvement in above-base revenue across all other regions. Next slide, please. ISS has been on a margin recovery journey over the past 5 years, improving from an operating margin of 0% in 2020 to a current margin of above 5%. This progress is a direct result of our focused execution of the OneISS strategy emphasizing selective tenders driving profitable growth and consistently managing costs. As we close out 2025, we finished the year with a margin slightly above 5%. The margin this year was impacted by commercial investments in the U.S. and EGM changes in the beginning of first half, both fully absorbed in our margin guidance. We also continue to invest in our shared service center in Gdansk with all European countries expected to be integrated by year-end. By leveraging wage arbitrage, we are maintaining strong momentum and reinvesting to onboard additional processes later this year and exploring potential expansion beyond Europe. What's truly important here is that we have been able to invest significant amounts into contract start-up and reinvest in the business while still delivering on our margins. Please turn to the next slide for some thoughts on our free cash flow. Free cash flow for 2025 was DKK 2.7 billion, equaling a cash conversion of 64%, those slightly ahead of guidance. This was driven by DKK 200 million of prepayments rather close to year-end, primarily driven by customer receivables before due date. Hence, adjusting for that, we slightly overdelivered at DKK 2.5 billion. Working capital benefited from tight receivables management and a slight improvement in DSO compared to last year. Also, it's worth noticing that the factoring balance grew less than organic growth for the full year, hence, increasing the quality of our free cash flow once again. Let's go to the next slide for a brief update on the capital allocation policy. I'm pleased to share that this morning, we are launching a share buyback program of DKK 2.5 billion, in line with our capital allocation policy. DKK 2.5 billion is a starting point and we will reevaluate the situation later in the year to ensure our capital deployment remains aligned with our priorities. ISS buyback journey began in 2024 and we continue to maintain a strong focus on doing what is best for our shareholders. All excess capital belongs to our investors, and we are committed to deploying that capital in a way that maximizes long-term value for our investors. Combined with our proposed dividend of 20% of net profit equaling DKK 3.2 per share, we are delivering a total payout yield of above 7% to our shareholders. During the year, we completed 2 acquisitions in total, Garbialdi in Spain and Franye in Austria, combining adding 0.8% on group revenue on a full year basis for a total enterprise value of around DKK 300 million. The reason for us doing only 2 is that we continue to look very diligently at the business cases and they have to generate long-term benefits to ISS including short-term financial benefits through synergies and smooth integration, as mentioned before. The multiple for both acquisitions after synergies are attractive compared to ISS' current trading multiples, reflecting our disciplined approach to capital deployment and both acquisitions are performing according to plan. In 2026, we will continue to do what creates most shareholder value. We will continue to evaluate M&A opportunities where there either is a strong strategic fit or clear operational synergy or it simply makes financial sense. Above all, every M&A decision must be value accretive for our business and for our shareholders. That concludes the financial update. I'll pass it back to Kasper, who will walk us through the outlook for 2026. Please turn to the next slide.

Thank you, Mads. We continue to see significant growth opportunities across all of ISS' markets with each region presenting promising potential for further expansion. With our strategic investments and the strengthening of our commercial function, we're confident in achieving a higher like-for-like growth than in the previous couple of years. Therefore, we are guiding for above 5% organic growth for 2026. As I mentioned earlier, in '26, we anticipate a slight shift in our organic growth algorithm with less reliance on pricing and a greater contribution from like-for-like growth, driven by higher volume and net new wins. Regarding margins, we are guiding for an operating margin of above 5%. Once again, I want to emphasize that our focus is on driving the absolute growth of EBITA, not just adding incremental basis points to the margin. We need and we want the flexibility to reinvest in relevant growth opportunities. Our priority is increasing ISS' absolute earnings power while maintaining high cash conversion. This, we believe, is the best way to generate shareholder value. Now let's move to the next slide to review our free cash flow guidance. We keep a relentless focus on cash flow in ISS. And also in '26, we expect to deliver an underlying cash conversion of above 60%. This equals above DKK 2.7 billion in underlying cash flow, adjusting for the DKK 200 million negative impact from the 2025 prepayment, we expect free cash flow of above DKK 2.5 billion before any positive impacts from Deutsche Telekom. We still expect payment from Deutsche Telekom for the amounts withheld in the past, which will bring our expectations to the free cash flow, including Deutsche Telekom payments at above DKK 3.1 billion for the full year. Please turn to the next and final slide. As we wrap up, I would like to highlight how ISS strategy and performance combined to deliver sustainable shareholder value. Our equity story can be summarized as follows: ISS has a strong market leadership in a growing facility service market with a GDP plus growth rate. We maintain a relentless focus on profitability, driven by our operational discipline. We generate robust cash flow, giving us the flexibility to reinvest in growth while returning capital to our shareholders. This foundation is reinforced by disciplined capital allocation, balancing reinvestment, bolt-on M&A and share buybacks. On top of that, we have a strong sustainability agenda, which not only reflects our values, but also provides us with a meaningful competitive advantage. Taken together, these strengths position ISS to deliver sustainable growth and long-term value creation for our shareholders. In summary, 2025 was another solid year for ISS. We delivered in line with all key parameters, demonstrating strong stability and consistency showing the resilience of our company despite elevated macroeconomic uncertainty. Looking ahead, our focus is to continue delivering as we promise quarter after quarter. We are on the right track, making the necessary investments and building a stronger ISS than ever before. I'm confident that we will continue to accelerate. The strengths of ISS are undeniable. Our strategy is clear. The investments are in place. The leadership is strong, and we're simplifying the way we operate. This ensures that all 325,000 of us are moving in the same direction together. Let me finish by thanking our placemakers. Your dedication and care in every service moment defines ISS and earn the trust of our customers every day. To our customers, thank you for your partnership. We remain committed to helping you achieve your desired outcomes. Finally, I want to extend my thanks to all the investors we've met throughout the year. Your trust and support make all the difference. And I look forward to continuing our journey together. We look forward to seeing all of you at our upcoming Capital Markets Day later in 2026 where we'll deep dive much deeper into our value drivers, sharing the progress we've made, the initiatives underway and what's on the horizon as we look to the future. 2026 is an incredibly exciting year for us. Not only do we have significant business plans, but we are also celebrating our 125-year anniversary. This milestone is a celebration of the impact that we have had on millions of people, our successes with trusted customers, our contributions to local communities and, of course, the incredible talents who have used this company as a platform to realize their dreams and ambitions. With that, we've concluded the presentation, and we will now open the floor for Q&A.

[Operator Instructions] The first question is from the line of Mads Brinkmann from Berenberg.

If we can just start on organic growth, please. I appreciate that this year, you're guiding of above 5% instead of the [ 4.6% ]. I assume there's a level of confidence in being able to do that. But is there an element of conservatism here? I mean I think on the volume side, it's probably relatively straightforward in terms of what you have so far announced last year. But if I look at the pricing side, I know you're guiding for above 3%. But if I look at my numbers, it looks like the pricing is going to be closer to 4% than it's going to be 3%. And I think by now, you should have a pretty good idea of how pricing looks like. And I think also just bearing in mind on organic growth, that, of course, as you alluded to, you only have 4% of larger contracts up for renewal, which is in '26, which is down year-over-year and retention looked good in Q4. So I'm just wondering if there's an element of conservatism here and if things doesn't actually point more to something like 6% or the high end of the previous range. Then my second question, please, on the margin. I mean I appreciate you say that you're investing, and I think there's also a restructuring charge in there that means that the margin would have been 6, 7 bps higher or something, but in theory, we've had OneISS, we've had margin accretive acquisitions and in theory, better leverage on the top line. So why are we not seeing like why we're not seeing more impact -- positive impact on the margin here? And just on the margin as well. I understand the U.S. is down. I think that was well flagged and understood, but I'm a little bit puzzled by the fact that Central and Southern Europe was actually down. I think it was down 60 bps year-over-year in H2, at least. So maybe if you could just comment on what drove that development in Central and Southern Europe as well, please? And then just lastly, a quick one on the phasing of the margin. Sorry, if I missed it, but I guess this year was around 165 bps. Normally, it's 150, but in '24, it was probably close to 200. So just any guidance on how we should think about that into '26?

Thanks for the good questions. I appreciate it. So first of all, we are guiding above 5% on organic growth because we are confident that the growth will be above 5% this year. And just to help you on the building blocks that you alluded to yourself, which will give you some additional color. We expect prices this year to be higher than what we've seen historically, but lower than what we saw in '25 in last year. And then you are indeed right, we expect underlying growth to be positive over the course of this year, '26, and that's both growth with existing customers, and it's also on the net new win. That's also what you've seen in the fourth quarter of 2025 and we expect that to continue throughout 2026. And then, of course, we have the last component, which is project volume which is more difficult to predict. However, there's nothing pointing in the direction that we should see a structural decrease in project volume. But it is early in the year. We've had a good start to the year, but it's too early to predict exactly where that is ending up from a project point of view. Hopefully, that gives you some color on where we are on organic growth. And then, of course, the things that you're mentioning, I agree on that. We will continue to update you on a quarterly basis in terms of progress. But overall, we believe that we have turned a corner here and are starting to see the underlying growth coming through, which we are very pleased about. From a margin point of view, you are indeed right that we are investing into Americas, and I'll come back to your comment around Central and Southern and investing into Americas and delivering the 5%, which is the same ratio as in 2024, of course, means that the rest of the business is improving. So there is an improvement in the rest of the business in '25 versus '24. And that has -- and then we have done those investments into the Americas. And of course, we are investing because we are expecting to see a return. So we are following the progress in the U.S. a lot. We believe we are doing absolutely the right things. Now we have the management team in place. The plan is clear. The pipeline is building and now we need to convert those opportunities into new wins for us as a company. Then you alluded a little bit to indirectly, well, is 5% just the limit in terms of profitability to the ISS business. And of course, it's one of the areas that we'll deep dive into in a Capital Markets Day. I don't want to socialize the discussion where we don't have concrete data and substance in that discussion. So at the Capital Markets Day, you should expect that we will come with data that will show you where the opportunities are and also show you how we are intending to get our arms around those opportunities and then how that is converting into financial expectations in the midterm and in the long term. Specifically on your comment on Central and Southern, it's simply us that has accelerated some investments there, predominantly related to the shared service center that Mads has mentioned and communicated several times. We've done that here in the fourth quarter. So nothing in regards to trading, it's some incremental cost that we've incurred in November and December, which will pay a return obviously going forward. And lastly, on phasing, you should expect normal phasing on margin over the course of '26. So you mentioned the 1.5% yourself. That's a good data point to use for modeling purposes in terms of phasing on margin this year.

The next question is from the line of Remi Grenu from Morgan Stanley.

Just a few questions on my side. So talking about the shared services centers and trying to understand a little the phasing of investments. So can you help us understand what's been the net contribution to margin in 2025? So the costs you've put on the table versus the gains you've made already in year 1? And how that compared to your planned investments in 2026 and the gains you're going to realize on the '25 investment and '26 as well. So yes, just trying to understand a little bit what could be the support to margin in 2026 from these initiatives versus what you've done in '25 already. So that would be the first one. The second one is on the comment you made, Mads, on the share buyback. I think you alluded to the fact it could be -- you left the door open for that share buyback to be increased at some point this year. So I'm trying to understand what's the potential upside there, which is driving this comment. Is it simply about better cash generation, working capital management or a view that M&A spend this year could be a little bit lower than what you've done in 2025 or just increased confidence on the DTAG contract? And I appreciate you probably don't want to comment on the last point, but just thought I would put that there as well. And the last one is to elaborate a little bit on the previous question on organic growth. I mean I concur to the point that it seems a little bit conservative also on the net win side, I mean at least 1 point. I know that the guidance is open-ended, but DWP alone on a stand-alone basis should bring close to that contribution in 2026, I guess. So I'm just trying to understand if I'm missing anything there in terms of potential loss of contracts with the small clients, which could be an offset or the 1 point contribution from -- at least 1 point contribution from net win is just to remain on the conservative side?

Yes. Thank you very much, Remi. I will start to address 2 of your questions, and then Kasper will take the 2 last one. If we take the share buyback, you're absolutely right. As I said in my presentation, the DKK 2.5 billion is a starting point. We have kept a very flexible approach to capital distribution. And it is based on an ongoing evaluation depending on where we see both leverage but also what Kasper and I are comfortable with alongside, recommending to potentially increase at a later stage. Then you allude to the DTAG case and money from there, Kasper can comment on it. But in reality, that means we are having a flexible approach. We have also shown them both in '24 and '25 that we were able to increase the share buyback over the course of both years. When it comes to the shared service center journey, it did have a negative impact on our 2025 margin. The reason for it is that to Kasper's point before, was that we were able to accelerate. We had an opportunity to do so. And therefore, we decided to do it because we believe it's the right thing for ISS going forward. For '26 purpose from the margin perspective, I think you should expect that the shared service center journey will be more or less neutral because things are starting to come through alongside as we invest. So for '25 negative, for '26 flat.

Yes. And on your comment on Deutsche Telekom, nothing has changed in terms of our expectations to the outcome, nothing compared to what we have communicated previously. So Deutsche Telekom is owing us some money from the past, and we still feel confident that we will get that cash to a magnitude of the DKK 600 million that we mentioned all the way along. So no changes to that. And in terms of your questions on conservatism on the organic growth. I mean, it's early in the year. And with the horizon we -- the transparency we have as of today, we're looking into a year where we are very positive and optimistic about the organic growth for 2026. And then, of course, we will update you each quarter. And as I said, we have had a good start to the year. So the first data that are coming out in terms of the results for the first couple of months in the year are looking good. And then you mentioned in terms of losses. I mean we have a retention rate of 94%, which is an improvement versus the 93% that you saw last time, so it's moving in the right direction. But of course, we lose customers. Otherwise, that retention rate will be 100%. But I'm factoring that into the comments that I made earlier around that we are in a better place commercially, but it is early in the year.

The next question is from Kristian Godiksen from SEB.

A couple of questions from my side as well. So first of all, an additional question on the guidance, which seems conservative, especially on the net new wins based on when you compile all your contract announcements. I reckon obviously that it's open-ended, but maybe you could elaborate a bit on why it's only above 1%. Are there anything in terms of the retention rate or pruning of contracts below DKK 100 million we can't see? Or are you just cautious being early in the year and want to go back to the track record you have back in -- how you guided back in 2023. That would be the first question. And then the second question, obviously, I'm aware you can't comment too much on the details in DTAG dispute with them. But then a technical household question from my side, obviously, I'm not a lawyer or expert in German arbitration rules. So just can you put the arbitration proceedings on hold if you and DTAG agreed with that? And yes, if you are staying to the arbitration that you are closing in on bilateral agreement, that would be the question on DTAG and then maybe you could comment on the underlying profitability. Most recently, I remembered you said that it's black numbers now but still margin dilutive? And then on the third question, just also a follow-up on the shared service center. You mentioned that 9 countries is now on. What does that make up in terms of the percentage of total countries that need to be implemented. And yes, maybe you can comment on the underlying cost savings coming through when you deduct for the implementation costs?

Yes. Kristian, so let me start on the shared service center journey. I will not give you a direct number about how we see the improvement underlying because what is really important here is that we keep investing it. What I said before was that we expect the margin neutral contribution for '26. But what I also said in my presentation is that we are also evaluating to establish shared service center outside Europe. And that means both from our APAC region, but it also mean from our U.S. region. So depending upon how we accelerate those journeys and how we look at that journey that depends on how the margin contribution from the shared service center will be over time. I think what is most important here, we are doing this because it's the right thing for ISS. We are doing it because it's economies of scale, and it makes a lot of sense. And there's no doubt that over time, this will definitely be the right thing, but it will be one of the points that we can dive more into details at our upcoming Capital Market Day.

Yes. Thank you, Mads. And on your questions on organic growth and DTAG, just a few words on that. I mean I think you mentioned it yourself. So the organic growth of above 5%, that's a floor. And it is early in the year, and we are predicting as accurate and complete as we can. I'm not going to give you the building blocks per quarter. But for the full year, we expect that the underlying growth both for net new is -- and on growth with existing customers is significantly better than what we have seen in '25. And you're seeing it starting to come around here in the fourth quarter of '25 where volume with existing customers is a contribution of 1.5% and 0.5% on net new. In terms of DTAG, as I said in my presentation, it is a sensitive legal matter. And for commercial reasons, it's limited what I can disclose further, Kristian. So the development that we are putting in the report and telling you is that there are 2 tracks now to resolve this matter. There is the ongoing arbitration case. And then there are conversations with the customer that are ongoing. And again, in terms of outcome, our expectation has not changed. And if we are to settle through conversations with the customer, well, then it's going to be at terms that are attractive to ISS and of course also attract to Deutsche Telekom, but that means that what they owe us from the past is getting paid and that we are getting a fruitful outcome in terms of commercials going forward.

Okay. Okay. Can I just maybe ask one follow-up question on the organic growth part. So obviously, I reckon that it's a floor guidance of the above 5%. It was more on the specific one on the net new wins of above 1%. Are there anything there below the DKK 100 million that we should be aware of or some contract pruning or on the retention rate, something that you can't see from just the contract announcement tables that you put out to be aware of?