Earnings call transcript: ISS holds guidance after strong H1 2026 growth

The Danish ISS company reported strong first-half 2026 earnings, confirming a gradual but balanced improvement in its business. Organic growth accelerated, with 8.9% growth in Q2 and 29% higher earnings per share year-over-year. Margins remained steady at about 5.25%, and free cash flow guidance exceeded DKK 3.1 billion. Management reaffirmed full-year growth guidance above 6% and maintained the margin target at 5.25%.

The company highlighted pricing, volume, net new wins, and above-base activity as key growth contributors. ISS reported a 4.6% operating margin, supported by structural improvements from the Deutsche Telekom agreement and better execution across regions. Investors responded positively, pushing shares up 3.44% to $282.40, near the stock's 52-week high.

A settlement with Deutsche Telekom is expected to add 10 to 15 basis points to group margins annually. ISS also increased its share buyback program following the settlement. The company expects continued growth, with second-half growth likely to slow to about 4% due to tougher comparisons. ISS plans to hold a Capital Markets Day in Copenhagen on Sept. 14 to discuss strategy and long-term opportunities.