<a id="bm-comp-998d41fd-2000-4bfd-8ee6-a9b8dd843dc6" name="bm-comp-998d41fd-2000-4bfd-8ee6-a9b8dd843dc6" class="BMCustomAnchor"></a><table><tr><td bm-component-id="998d41fd-2000-4bfd-8ee6-a9b8dd843dc6" style="vertical-align: top; width:100.000000%;"><ul><li>56% incre. EBITDA margin in Q3 highlights the scalability</li><li>Increased confidence in positive EBIT in 2025e</li><li>EBITDA estimates +5-3% '25e-'26e; 13-9x EBITDA</li></ul></td></tr></table><a id="bm-comp-d2a94e66-7a7a-4885-acf3-6a041e26187b" name="bm-comp-d2a94e66-7a7a-4885-acf3-6a041e26187b" class="BMCustomAnchor"></a><table><tr><td bm-component-id="d2a94e66-7a7a-4885-acf3-6a041e26187b" style="vertical-align: top; width:100.000000%;"><h3 class="bm-h3">16% sales and 47% EBITDA growth (56% incr. margin) in Q3</h3><p>Clavister executed relatively in line with our expectations in Q3 but with better cost control (EBITDA +6% vs. ABGSCe). EBITDA grew 47% on 16% sales growth, for an incremental margin of 56% (64% LTM), highlighting the scaling potential, while EBIT turned slightly positive. We therefore increase our confidence in positive EBIT for 2025e and raise our EBITDA estimates by 10% for '24e and 5-3% for '25e-'26e.</p><h3 class="bm-h3">'Security by Sweden' brand should grow stronger</h3><p>Many Swedish and European municipalities still rely on US or Israeli-based cybersecurity, which constitutes Clavister's primary competitor base. But we believe that the newly elected US president's attitude towards NATO and Europe and the general increase in geopolitical tensions could strengthen the case for European cybersecurity further among European municipalities and defence agencies (Clavister's core customer base). As such, we believe that Clavister is well-positioned for continued solid growth.</p><h3 class="bm-h3">We expect accelerating growth in 2025e</h3><p>Clavister is just starting to ramp up sales from its defence business, and we think it is in the process of securing new defence contracts, with both the existing customer BAE Systems but also potentially its newer partners, Thales and General Dynamics. As such, we believe its defence business is positioned to accelerate through 2025e and potentially 2026e. Meanwhile, we expect that its core software business will continue to grow by double-digits in the coming years supported by stronger demand and price increases: we are under the impression that Clavister is looking into more aggressive price hikes for its software in 2025, which should give further support to the ARR growth. All in all, we see Clavister growing sales by 18% in 2025e (17% in 2024e) while turning EBIT positive.</p></td></tr></table>