<a id="bm-comp-0ffb5e78-2e2d-4f94-bfca-5b0d8c16f92f" name="bm-comp-0ffb5e78-2e2d-4f94-bfca-5b0d8c16f92f" class="BMCustomAnchor"></a><table><tr><td bm-component-id="0ffb5e78-2e2d-4f94-bfca-5b0d8c16f92f" style="vertical-align: top; width:100.000000%;"><ul><li>'25e-'27e adj. EBITA up 3-1%</li><li>Continued strong GM, despite negative product mix</li><li>8.5x '25e EV/EBITA is ~45% below peers</li></ul></td></tr></table><a id="bm-comp-191c7d40-cb57-4e59-9404-7c5bb7a7bb21" name="bm-comp-191c7d40-cb57-4e59-9404-7c5bb7a7bb21" class="BMCustomAnchor"></a><table><tr><td bm-component-id="191c7d40-cb57-4e59-9404-7c5bb7a7bb21" style="vertical-align: top; width:100.000000%;"><h3 class="bm-h3">Takeaways from the report</h3><p>The Q2 report was characterised by slightly higher organic growth than we have seen in the past year, partly as the Easter holidays occurred in mid-April (Q2) rather than in Q1 last year. Due to this effect, we anticipated H1 sales to be tilted more towards Q2, but even so SEK 1,983m in sales was 4% above our estimate. The gross margin was solid at roughly 32%, negatively impacted by FX and the product mix of Easter sales. The adj. EBITA was strong (13% above cons, 7% above ABGSCe) for a margin of 7.3%. Free cash flow was significantly better than Q2'24 (SEK -300m), but still negative at SEK -91m. Q2 is a tough quarter for FCF, characterised by seasonal inventory build-up. Moreover, FCF was affected by new FX regulations in the UK, decreasing OCF by SEK 12m.</p><h3 class="bm-h3">Estimate changes</h3><p>We raise '25e-'27e sales by 1-0% and adj. EBITA by 3-1% after the report. Our expectations for H2 are largely unchanged on the back of the report, and as such the estimate revisions are primarily on updated FX and mechanical effects. H1 NRIs have amounted to SEK -42m, and as such our unadjusted earnings estimates are down. The CEO commented that Humble is positioned to start treading lightly into some smaller acquisitions, and Humble restated its aims to lower its leverage. Given this commentary, we believe that once the company has gone through its anticipated cash flow generative phase and further deleveraging, acquisitions could start occurring again. The report outlook also stated that there is pent-up demand in both confectionery and sport nutrition, and we expect these segments to drive growth in H2.</p><h3 class="bm-h3">Valuation</h3><p>Based on our revised estimates, the company is trading at a '25e EV/EBITA of 8.5x, which is ~45% below the peer average, despite peers growing earnings at a slower rate than Humble.</p></td></tr></table>