Is Pool Quality Becoming A Bigger Issue?

Research evidence excerpt

Is Pool Quality Becoming A Bigger Issue?

Australia | Transport & Logistics

Brambles EquityJulyResearch6, 2026

TARGET | ESTIMATE CHANGEIs Pool Quality Becoming A Bigger Issue?

The implications from the withdrawal of US repair capacity will continue RATING HOLD

into FY27, and at a higher cost than previously expected. With repair costs PRICE AUD19.72^

increasing as the pool age increases, the question is whether the current PRICE TARGET | % TO PT AUD18.22 (AUD19.55) |

level of investment in new pallets is still appropriate. The likelihood is that -8%

52W HIGH-LOW AUD26.93 - AUD16.18

more investment is now needed, across the pools of CHEP USA and Europe.

FLOAT (%) | ADV MM (USD) 101.1% | 76.34

Our TP is lowered from A$19.55 to A$18.22, our rating remains Hold.

MARKET CAP AUD26.1B | $18.1B

Pool Age and Damage Rate: There is a direct relationship between the age of a pallet pool and TICKER BXB AU

^Prior trading day's closing price unless otherwise

the repair rate. While increases in durability initiatives do help lower damage rates in a pallet noted.

pool, they are generally not themselves sufficient to offset the impacts of a pool age that is

increasing. In this note we highlight the change in pool age across CHEP Americas, which we

see as a proxy for the damage rate - highlighting a greater need for higher capex levels going FY (Jun) CHANGE TO JEFe JEF vs CONS

forward to improve pallet quality for customers. 2026 2027 2026 2027

REV NM <-1% NM NM

A case for greater capex investment: A key focus of management has been to reduce EPS <1% -6% -1% -3%

uncompensated loss and improve asset efficiency. The result has been to lower the levels of

new pallets injected into the pools - and while positive for ROIC - there are consequences of 2026 (AUD) 1Half 2Half FY