Having completed the operational model and understood the forecast, especially in terms of the segments with a reasonable level of detail, we're now ready to apply this into a valuation.

We're going to use a trading comp basis.

First thing we need to do is to analyze the pensions because they will provide what could be quite a significant bridge item if we total up the total obligations and compare them to the assets.

We could net out that and we could find that we have what appears to be a net obligation of 671.

However, this would ignore some detail.

We see here that the German pension funds, okay, they are in negative, so they have an obligation.

You can see that if we apply that to the uk, it's a different view.

UK is standing in surplus in its pension funds and other is standing in deficit.

Now, although they add up to 6, 7, 1, doing this in total is a bad idea and that's because the UK surplus can effectively be ignored from the point of view of valuation because that surplus will not be accessible to a prospective buyer and it's not as important as the deficits, which really do need plugging by a prospective buyer because they represent a guarantee given by Keon to its pension holders on retirement.

What we're going to do is we're going to recognize that in most countries you would get a tax break.

We're going to run that at the MTR, and you can see that's 30% across the board.

We need to be careful here because really ideally we would go and find the MTR for each of these countries.

We don't exactly know where other is or what it is, so we're going to simplify.

Now, notice that I have not done that for the uk.

That's because again, they're in surplus and that surplus does not end up being important from a valuation point of view.

If we now add up everything, you can see that we have quite a different view 'cause we are looking in detail at funds rather than in aggregate.

The risk of grabbing just a balance sheet items and going in aggregate is that you may by accident bring funds in surplus, which you should really be ignoring.

We're now ready to start our comparable based valuation.

We're going to use the 2024 EBITDA as a starting point.

This can be found on the main model.

It's adjusted EBITDA because it's being cleaned, and that's useful because the comparables or ratios we're using are probably also from cleaned data, so it marries up nicely.

You can see that when we go up via that 5.5, which is perhaps from comparable industrial companies, the predicted EV today, so the value of operations is about 10 billion.

We need to now cross the bridge to predict the equity.

The net debt can be found in the metrics that we built up.

We need to be careful because we can quite often get stuck into the idea that we're in 2024 because that's what we did with ebitda.

But recall that the valuation is taking place today and the investment date today is the end of the last historical period.

So when we do bridge item work, we'll go and fetch from 2023 instead.

The pension liability we have already calculated and now we can cross the bridge carefully by saying the EV minus the net debt minus any debt likes will be the equity.

And here I'm just showing my formula.

We've been given the diluted share outstanding, although we also had that on the assumptions tab, and we go down to an implied share price of just over 27 euros, 27.6, and we can now compare that and say our model would predict a share price of about 27 and the current share price at the point of the valuation, which from the point of view of this recording is in the past is 26.8.

And so our opinion from our forecasts and our assumptions is that perhaps Keyon is worth more than it seems on the open market today, and so perhaps would be a good investment.