<a id="bm-comp-f06b1fa2-1f68-452f-a7d5-32d96a6da06c" name="bm-comp-f06b1fa2-1f68-452f-a7d5-32d96a6da06c" class="BMCustomAnchor"></a><table><tr><td bm-component-id="f06b1fa2-1f68-452f-a7d5-32d96a6da06c" style="vertical-align: top; width:100.000000%;"><ul><li>Q3 was softer, but better cost control was positive</li><li>'25e-'27e sales cut by 15-22% on lower volume expectations</li><li>Positive momentum into Q4, driven by OEM recovery & R290 rollout</li></ul></td></tr></table><a id="bm-comp-01fa13f6-3e78-495a-962c-24b65929a875" name="bm-comp-01fa13f6-3e78-495a-962c-24b65929a875" class="BMCustomAnchor"></a><table><tr><td bm-component-id="01fa13f6-3e78-495a-962c-24b65929a875" style="vertical-align: top; width:100.000000%;"><h3 class="bm-h3" style="text-align:left;">Expect a return to growth and positive EBIT in Q4</h3><p style="text-align:left;">Q3 sales were SEK 46m (-9% y-o-y and -22% vs. ABGSCe). The weaker sales were due to continued inventory build-up among OEM customers in the beginning of Q3, which eased towards the end of the quarter. Going into Q4, we expect a return to growth (we estimate SEK 63m, +18% y-o-y), driven by recovering OEM sales and the ongoing rollout of R290 heat pumps. Moreover, we expect the positive momentum from ES-branded sales to continue in the coming quarters (~40% of sales in Q3 vs. 30% LY), supported by the company's strengthened distribution network. Thanks to improved cost control, the EBIT miss was small (SEK -3m vs. ABGSCe -2m), with a return to positive EBIT (SEK 2m) expected in Q4. Furthermore, inventory levels were lower in the quarter, contributing to positive FCF of SEK +1m (-5m LY).</p><h3 class="bm-h3" style="text-align:left;">Estimate changes and outlook</h3><p>We reduce '25e-'27e sales by 15-22% on lowered volume expectations. This, combined with better cost control, results in '25e EBIT of SEK -21m (previously SEK -18m), which then improves to SEK 7m (vs. previously 11m) in '26e. Looking ahead, we expect the share of Aira sales to decrease as the two-year contract period nears its end (we estimate a contribution of ~SEK 380m over the two years). Nevertheless, we expect a return to growth in '26e, driven by continued momentum in ES-branded products, new OEM partnerships, and the ongoing rollout of R290.</p><h3 class="bm-h3" style="text-align:left;">Market recovery should provide support</h3><p style="text-align:left;">We continue to think that the long-term driver for both volumes and profitability is improving market conditions. Based on recent market data, we see signs that conditions are on track to improve, although the timing and pace of the recovery remain uncertain. ES is currently trading at 6x-2x EV/EBIT '26e-'27e. Due to our revised estimates, we lower our fair value range to SEK 20-50.</p></td></tr></table>