<a id="bm-comp-fb9c19c9-a551-468b-88fc-be322d03356b" name="bm-comp-fb9c19c9-a551-468b-88fc-be322d03356b" class="BMCustomAnchor"></a><table><tr><td bm-component-id="fb9c19c9-a551-468b-88fc-be322d03356b" style="vertical-align: top; width:100.000000%;"><ul><li>Minor estimate changes</li><li>Potential start of variable revenue acceleration</li><li>EV/ARR 2x, '25e EV/EBITDA ~8x</li></ul></td></tr></table><a id="bm-comp-39fa69a9-4675-4faa-8913-9385dbeb29a7" name="bm-comp-39fa69a9-4675-4faa-8913-9385dbeb29a7" class="BMCustomAnchor"></a><table><tr><td bm-component-id="39fa69a9-4675-4faa-8913-9385dbeb29a7" style="vertical-align: top; width:100.000000%;"><h3 class="bm-h3">Q4 in line</h3><p style="text-align:left;">The Q4 report was in line with our estimates and quite uneventful again. ARR continues to grow sequentially, but more importantly, it appears that the conditions have improved for Litium's clients to the extent that variable revenue has started to increase as a share of total revenues. This means that Litium's client-linked scale could start to have a positive impact on revenue and EBITDA.</p><h3 class="bm-h3">'25e-'26e EBITDA nearly unchanged</h3><p>We trim '25e-'26e sales and ARR by 4% and 2%, respectively, after the report. However, we leave our EBITDA estimates mostly unchanged, as we believe that higher gross margins from variable sales can compensate. We anticipate some acceleration in the growth rate due to the higher variable revenue, which enables upside in both revenue and earnings over time as clients grow volumes. While one quarter is generally not sufficient to extrapolate estimates, an acceleration in variable sales is something we have been waiting for in order for additional upside to growth to materialise. We remain optimistic about the company's operating performance and prospects thanks to Litium's dependable operating performance, and are encouraged by the potential for higher growth once the company generates some more variable sales.</p><h3 class="bm-h3">Valuation</h3><p>Our revised estimates imply that the company is trading at an EV/ARR multiple of ~2x and at a '25e EV/EBITDA of ~8x, whereas Nordic IT services peers are trading at a '25e EV/EBITDA of ~15x.</p></td></tr></table>