KMD A/S

Ledelsesberetning

CEO LETTERBuilt to solve what mattersDenmark has always been at the forefront of digitalization. That did not happen by acci-dent. It happened because politicians, public institutions, citizens, and companies made deliberate choices, over decades, about how technology should serve people and society.We at KMD have played a central role in that work for more than ve decades, helping build the digital infrastructure that millions of citizens and institutions depend on every day. I am reminded of that every time I talk to one of our customers.We were founded by our customers to help them transform. Not just to supply tech-nology, but to help solve challenges they knew they could not solve alone. That is still the reason we are here more than 50 years later. It is the foundation we build from, and something we never take for granted.The rst 50 years were about building the foundation, and the next 50 are about what we do with it. The societies we serve are facing changes on all levels driven by geopo-litical uncertainty, signicant technological developments, and demographic shifts. Thatis the world our customers navigate every day. A world that demands more from the partners they choose. That is why we have spent the last year making deliberate choices about the future of KMD, so we can continue to be the partner our customers need us to be. They need us to deliver reliable technolo-gy. But they also need a partner who under-stands the societal developments shaping their reality, from AI disruption to digital sovereignty and climate resilience, and who can translate that understanding into solu-tions that work. This year, next year as well as 5, 10, and 20 years from now.In the nancial year 2025, KMD delivered our strongest nancial result since we were acquired by our owners NEC in 2019. That is important on many levels, but mostly because it enables us to keep investing in the capabilities, the technology, the partner-ships, and the long-term commitments that our customers need from us.When I look back at 2025, we made choices to strengthen the platforms and partner-ships that support critical public services across Denmark and allows us to leverage the capabilities of our owners. We also acceler-ated our work on AI – not as an experiment, but as a capability we are deploying with customers to improve the quality, the speed, and the capacity of public services such as education, health, and social care.As we enter the nancial year of 2026, we do so with a new strategy and a new operat-ing model, both designed around the same logic: to bring the full strength of KMD to the challenges our customers face. Shorter paths to the right expertise. Even stronger collab-oration across the company. A clearer focus on the societal developments where we can make the greatest impact for our customers.In the years to come, we will further deepen our collaboration within the NEC Group. For our customers, that means access to some of the world's most advanced technolo-gy investments in AI, security, and digital infrastructure, delivered by a local partner who knows their context and who has earned their trust over decades.In 2026, customers will experience a KMD that is more proactive, and even more fo-cused on helping to solve their challenges. We will lead with insight, bring the full depth of what KMD knows, and use AI, our platforms, and our partnerships to help our customers shape the digital society we are all an integral part of. This is what we were built to do. And we have never been better positioned to do so.Thomas Jul Group CEO, KMD Management's Review Welcome to KMD KMD A/S is one of Denmark's largest IT and software companies, with locations in Copenhagen, Aarhus, Odense and Aalborg. The KMD Group also comprises subsidiaries in Norway, Sweden, Finland and Poland. The management review covers the fiscal year 2025/26, spanning from 01.04.2025 to 31.03.2026. Any reference to 2025 pertains to this period unless otherwise specified. Uncertainty regarding recognition and measurement Uncertainty regarding recognition and measurement is described in note 10 & 15 and covers impairment in relation to development projects and investment in group enterprises. There is no material uncertainty regarding recognition or measurement in addition to that. Development and financial matters The Company's Income Statement of the financial year 1 April 2025 - 31 March 2026 shows a result of TDKK 272.142 and the Balance Sheet on 31 March 2026 a total of TDKK 4.067.305 and an equity of TDKK 1.737.524. The one-offs from last year concerning changes to IT infrastructure suppliers and investment of software have occurred with no changes during the fiscal year. A reassessment of legal cases has been conducted resulting in no further losses on the matters identified last year, but solely a positive adjustment. During FY 2025, KMD demonstrated a strong result in operating profit ranging within the higher end of our expectation indicating KMD’s successful strategic transition towards core markets, software development. As part of the Company’s 2030-strategy to improve profitability, restructuring efforts took place during FY 2025 for which a provision of TDKK 50.000 has been recognized. The restructuring efforts are made to improve the agility of the organization as a whole. Net profit for the year compared with expected developments in the most recently published annual report Revenue development is in line with last year’s expectations, as KMD had expected a decrease of 5–15%. This decline reflects the strategic decisions to move away from pure IT outsourcing activities, including the transfer of related business to Aeven. In the 2025/2026 financial year, revenue decreased by TDKK 258.335 compared with previous financial year. Operating profit of TDKK 297.721 is significantly higher than in the previous year, primarily due to the non-appearance of extraordinary expenses, that occurred during the last financial period, reflecting stable operations across the company. We have based on expected developments demonstrated a successful divestment of IT operations with a decrease in revenue in FY 2025 ranging towards the lower end of the expected decrease. Additionally, we have partially settled our ongoing legal cases with an up-side and expect to fully settle in FY 26 without changes to our expectation. Risks Like most other IT companies, KMD is exposed to a number of business risks relating to market developments, shifts in customer demand, technological changes, employee recruitment, project execution, etc. Work to identify risks, consolidate the overview, and ensure that relevant measures are initiated is an integral part of managing the business. KMD's enterprise risk management processes are executed within the frameworks defined by the Board of Directors. A significant part of KMD's business is delivered in the form of customer projects, with performance terms outlined in the relevant contracts. Expectations for the future As the market continues to evolve, our strategy has evolved to strengthen KMD’s future. Our core strategic priorities have shifted towards being customer driven, alignment of capabilities, and ensuring profitable growth. In the coming year we expect a similar revenue +/- TDKK 50.000 compared to this financial year showing TDKK 2.955.916. The expectation to the development of revenue pertains to a derived effect related to transfer of business to Aeven, as well as close down of TSA solutions. To facilitate the strategic transformation, we expect KMD’s total profit from ordinary activities to decrease around TDKK 20.000 – TDKK 50.000 as a result of the transformation cost. KMD expects the profit from ordinary activities to be within the range of TDKK 250.000 – TDKK300.000. Management's Review Environment and climate The company has implemented policies and procedures to ensure compliance and progress in respect of the environment and climate. For further information we refer to: https://www.kmd.dk/om-kmd/baeredygtighed-og-compliance/csrrapporter. Knowledge and know-how resources With rapid technological advancements, customer expectations for increasingly complex and innovative solutions continue to rise. KMD is committed to accommodating our customers’ needs, as such, the undertaking of ongoing transformation, and organizational changes are initiated to better align and strengthen our capabilities. This enables us to more adequately understand our customers' challenges, leveraging our deep domain expertise, and providing innovative solutions that solve their most critical challenges. Subsequent events After the financial year, KMD’s strategic transformation is planned to commence. As part of this transformation, the initiation of planned mergers of Charlie Tango, UV Data and Edlund into KMD is expected to occur within the near future. Apart from this, no other subsequent events are expected to occur that may materially affect the financial position in KMD. Key Figures and Financial Ratios The development in the Company's key figures and financial ratios can be described as follows: DKK'000 2025/26 2024/25 2023/24 2022/23 2021/22 Revenue 2.955.916 3.214.251 3.236.671 4.099.365 4.302.335Operating profit/loss 297.721 -265.351 94.230 74.803 51.334Financial items net 42.741 96.343 -72.259 -12.154 20.706Profit/loss for the year 272.142 -105.324 18.071 52.522 63.363 Investment in tangible assets 33.377 39.598 18.923 28.861 17.594 Total equity 1.737.524 1.466.353 1.638.658 1.653.558 1.626.944Total assets 4.067.305 4.045.121 3.953.502 3.766.370 4.006.632Profit margin (%) 10,07 -8,26 2,91 1,83 1,19 Solvency ratio (%) 42,72 36,28 42,05 43,90 40,61 Avg. number of full-time employees 1.352 1.443 1.534 1.692 1.775 For definitions of key ratios, see Accounting Policies. Key ratios are calculated in accordance with "Recommendations and ratios" from CFA society Denmark. As a result of the merger of Scan Jour ApS, KMD Venture ApS and KMD A/S, the key ratios have been adjusted to reflect the balances and results of all 3 companies. See accounting policies for further details.