Today‘s Morning Meeting

Research evidence excerpt

Today‘s Morning Meeting

dically await safe crossing windows, sustaining higher vessel hire, tugboat and insurance costs.

Importantly, ex-Middle East conflict metrics continued to show earnings improvement, while management expects a portion of

the incremental costs to be recovered through customer variation orders, albeit through a lengthy process and with any benefit

more likely to materialize in 2027. Collectively, this suggests the earnings impact is primarily one of timing rather than a

deterioration in the underlying earnings trajectory. Beyond the Middle East, order momentum remains strong, with FY26

awards expected to exceed 2025 levels and the commercial pipeline reaching €63B this quarter, while Offshore Drilling visibility

improves into 2027 despite near-term maintenance and the shallow-water disposal. Given that the principal headwinds

appear transitory and the underlying business remains intact, we view the ~9% decline as an attractive entry point and

now see ~50% upside to our PT, with the proposed Subsea 7 combination remaining a meaningful source of longer-

term catch-up potential despite expected noise from Phase 2 reviews in several jurisdictions.

GSK PLC (Zain Ebrahim) (GSK LN, UW)

Core EBIT margin target implies c. 1% upside to 2030 Consensus, pipeline opportunities highlighted

encouraging though still early with clinical data required to drive upgrades

Yesterday, we attended GSK’s 2Q 2026 and “Accelerate Growth” event (see our first take here). We summarise our takeaways

below. GSK reiterated their confidence in the >£40bn 2031 Sales target, which now includes the contribution from Nuvalent,

and outlined their restructuring program expected to generate £1.9bn in annual savings by 2029, the majority of which is