Financial and Sustainability Targets

The Board of Directors of Sinch has set the following financial and sustainability targets:

Long-term value creation

The Sinch Board of Directors measures long-term value creation through assessment of free cash flow^[1] per share.

Sinch is targeting Net Zero emissions by 2050, in line with the Science Based Targets initiative (SBTi). Sinch also targets to achieve short-term and long-term emissions reductions in line with the goal of a maximum temperature increase of 1.5°C in accordance with the Paris Agreement.

Mid-term financial targets

By the end of 2027, Sinch targets^[2] to reach:

• Organic growth in net sales and gross profit of 7-9 percent year-on-year.
• Adjusted EBITDA margin of 12-14 percent.

The organic growth rate reflects an ambition to grow faster than market in each product category.

Capital allocation

Sinch is a profitable and cash flow-generating business. Surplus cash generated from the business will be used to reduce debt, finance future acquisitions and return cash to shareholders in Sinch.

Financial leverage policy

• Net debt over time shall be below 2.5 times Adjusted EBITDA (measured in a rolling twelve-month basis).

“Over time” means that the company’s debt is permitted to temporarily exceed 2.5 times Adjusted EBITDA during a period immediately after a business combination.

The financial leverage policy underscores Sinch’s commitment to maintaining a strong financial position and supports the company’s long-term financing strategy.
 

_{^[1] Free cash flow is defined as cash flow from operating activities after investments.}

_{^[2]These goals replace the previous financial target of “Annual growth in adjusted EBITDA per share.}