<a id="bm-comp-2e6d9ffc-d415-43ee-b02f-498bb0ac770b" name="bm-comp-2e6d9ffc-d415-43ee-b02f-498bb0ac770b" class="BMCustomAnchor"></a><table><tr><td bm-component-id="2e6d9ffc-d415-43ee-b02f-498bb0ac770b" style="vertical-align: top; width:100.000000%;"><ul><li>Enedo drove the 6% Q2 adj. EBITA miss while Inission beat by 4%</li><li>1.16x R12m book-to-bill supports y-o-y growth from here</li><li>Enedo only ~10% of our valuation; trading 40% below peer P/E</li></ul></td></tr></table><a id="bm-comp-f4f67c83-b719-49c2-8b0f-6341afc4a424" name="bm-comp-f4f67c83-b719-49c2-8b0f-6341afc4a424" class="BMCustomAnchor"></a><table><tr><td bm-component-id="f4f67c83-b719-49c2-8b0f-6341afc4a424" style="vertical-align: top; width:100.000000%;"><h3 class="bm-h3">Enedo drove somewhat softer Q2</h3><p>Q2 fell somewhat short of our expectations, with adj. EBITA 6% below. This was driven by a weaker Enedo segment, while the Inission segment beat by 4%. Enedo is still suffering from its more concentrated customer base, with key customers destocking. Orders were 10% below our estimate, although we note that this still marked a 22% y-o-y rise and a fairly healthy book-to-bill of 1.0x. Estimating orders has been tricky, as the company only recently started reporting it, and we remain in the dark on both volatility and potential seasonality. Given the strong R12m book-to-bill of 1.16x and the y-o-y increase, we do not read too much into the miss vs. our estimate.</p><h3 class="bm-h3">Orders support y-o-y improvements from here</h3><p>While Enedo's worsened profitability in Q2 could be considered worrisome, we note that its strong H1 book-to-bill of 1.4x, coupled with lower costs from permanent personnel reductions set to kick in at the end of Q3, suggest that better times lie ahead. While a return to y-o-y growth will likely have to wait until Q1'26e for Enedo, we believe we should see sequential improvement from here, as does management. Inission, on the other hand, is likely to see additional improvements in H2'25e, with organic growth >10% supported by R12m orders, and margin improvements as a result of this. For these reasons, we only decrease our '25e-'27e adj. EBITA by 3-2%, putting our '25e adj. EBITA 5% below the company's EBITA guidance.</p><h3 class="bm-h3">Trading 40% below peers on P/E</h3><p>Enedo's weakness is currently the main difference between Inission and peers, and has likely been a significant factor behind Inission currently trading 40% below peers on P/E. We note, however, that Enedo only contributes ~10% of Inission's value in our valuation, and that sequential operational improvements lie ahead.</p></td></tr></table>