Bend It Like Aramark

Research evidence excerpt

Bend It Like Aramark

d visibility on several of these priorities, while the Investor Update should

1 - PT and downside/upside scenarioprovide further clarity on how Sodexo intends to translate operational improvements into a Exhibit

80 80

sustainable acceleration in growth and profitability. 75 60%50%

70 65 40%

20%Earnings outlook – expectations reset, recovery ahead: the recent profit warning and 65 50% 30%

10%

50 22%earnings reset help establish more realistic expectations and provide a floor for earnings. 0%

40We expect FY27 guidance to remain conservative, with first signs of top-line inflection to 35 -25% -10%-20%

-30%gradually materialize, ongoing investments and limited near-term operating leverage (JEFe 30 Bear case Base case Bull case

PT (EUR - lhs) Downside/upside (rhs)FY27 org. growth2.2% ; adj. EBIT margin 3.4%). Longer term, we see a pathway towards .

mid-single digit organic growth and a rebuild of profitability to at least 5% EBIT margins as Source: Jefferies.

commercial momentum improves, retention strengthens and growth investments begin to

Exhibit 2 - ARMK share price performance vs

generate returns. peers since 2019

Valuation - Raising PT to EUR65: our estimates are largely unchanged. Following the rebasing 250

of earnings expectations, we believe investors can increasingly look beyond trough profitability 200

150and focus on normalized earnings power. We raise our PT to €65 (from €50), based on

discounted normalized earnings, reflecting greater confidence in the turnaround framework, 100

improving execution and the potential for net new wins to drive both earnings recovery and 50

Jan-19 Jan-20 Jan-21 Jan-22 Jan-23 Jan-24 Jan-25 Jan-26further multiple expansion.

. ARMK SW CPG

Source: Bloomberg, Jefferies.

Exhibit 3 - The recipe for success - 6 key