MASTERPLAST Nyilvánosan Működő Részvénytársaság

Earnings Release • Oct 6, 2025

ALTEO

BUY

One year target price: HUF 5972

mln HUF		Q2 2024 Q2 2025	Change (yoy)
Revenue	49787	54526	10%
EBITDA	9763	7927	-19%
EBIT	7541	4190	-44%
Net profit	5847	2794	-52%
EBITDA margin	19,6%	14,5%	-0,051
EBIT margin	15,1%	7,7%	-0,075
Profit margin	11,7%	5,1%	-0,066

Price (03.09.2025)	HUF 4740	Net profit (2025 Q2, mln HUF)	2794
Price (20/11/2024) Shares outstanding (mln)	19.9	Bloomberg ticker	ALTEO HB Equity
Free float	26.2%	BÉT ticker	ALTEO
Market capitalization (mrd HUF/mln EUR)	98,5/249	52 week min./max.	HUF 3980–6880

Source: BÉT, Bloomberg

On 01 September 2025 ALTEO (the "Company") announced financial results for its second quarter of 2025. The Company's EBITDA decreased by 19% and the revenue increased by 10% year over year.

The main drivers behind the higher revenue were the implementation of the new solar power plant near Tereske, which means higher sales volume in the Renewables-based electricity production segment, and the higher revenue of the schedule services. At the same time weather conditions, such as less windy days, negatively affected sales revenue. The Group's EBITDA decreased by 19% because of the higher general and administrative costs, which is partly the result of the stock-based compensation.

The energy chaos of 2022/202 and few acquisitions have had a crucial impact on the revenue in the last several years. If you would like to find more, please read our previous flash notes on the website of the Budapest Stock Exchange¹ . On 09 January 2025 the Company presented a new strategy plan. According to the presentation in the next five years the Company will focus on:

• the regional expansion, mainly in Slovakia, Croatia and Serbia, and secondly in Romania, Czech Republic, Poland and others in the region,

¹ Alteo elemzések - Bet site

• the upgrade of the renewable power plant portfolio (like significant growth in the capacity of wind,solar and/or other renewable power plants),
• the waste management segment, which could be a major segment from 2025/26 onwards,
• the schedule management (includes balancing activity and energy-storage), which is partly a technology intense area.

The management will likely identify new projects in the amount of approximately EUR 2000-2500 million in the next five years. This is a significant increase compared to the last five years. We believe the optimal ratio of the capital structure will not change so the equity/debt ratio could be around 30%/70%. It is worth noting that the capital expenditure mentioned above can be achieved with additional capital, like debt and/or share issuance, so a secondary public offering is highly probable. At the same time, it is not yet possible to determine the timing of the expected projects and/or the capital raising. By our model the Company's shareholder's equity could reach HUF 78 billion by the end of the decade, but the capital expenditure mentioned above (EUR 2000-2500 million, which is approximately HUF 890 billion at an EUR/HUF exchange rate of 395), is 10-12 times greater. 30 percent of the capex guided by the management is cca. HUF 265 billion which means that the Company should raise approximately HUF 175-185 billion capital (approximately 2-2.5 times the shareholder's equity calculated by 2029). Based on the new guidance by the Company the expected EBITDA could be much higher, Alteo could earn EUR 300 million EBITDA till 2030. To put it in context, the Company made HUF 19.7 billion EBITDA (approx. EUR 48.8 million) in 2024.

Results by segments

Non-renewables-based heat and electricity production and management: the segment's revenue increased by 19% and the EBITDA decreased by 19% in Q2 2025. The main catalysts behind the higher revenue are the expansion of the scheduling service portfolio and the price volatility of the electricity. The scheduling service is a high margin segment but according to the management this segment has become less favorable in recent months. Competition is increasing, which means the margins are under pressure.

Renewables-based electricity production: the revenue increased by 42% while the EBITDA increased by 43% in Q2 of 2025. On the one hand the better result is the consequence of more electricity production because of the newly implemented power plants. On the other hand, due to poor weather conditions, such as less windy days, the wind power plants produced the least electricity compared to the past five years.

Subsidy prices were growing with inflation till 2025, but from this year onward there was change, the inflation adjustment was abolished. The segment capacity reached 116 MW.

Energy services: The revenue decreased by 8% year over year, the EBITDA increased by 38%. In the future the main theme could be in this segment the strategic partnership with MOL, which can even significantly contribute to the segment's results.

Waste management: From 2023 the Waste management segment has been presented as a standalone segment. The revenue grew by 18%, and the EBITDA decreased by 36% in Q2 2025 on a year over year basis. We think that in the future the EBITDA margin could be approximately 15-25 percent, which means the waste management could become the second most profitable segment. The next 35 years MOL will be managing the collection and treatment of the municipal waste, and ALTEO participates as a subcontractor in this process for 2 (+2 optionality) years. At the end of last year Alteo has bought ÉLTEX Ltd. and we expect that the deal will have been closed by the second half of this year.

The acquired company is operating in the waste management industry with revenue from HUF 10 billion to HUF 40 billion and EBITDA from HUF 600 million to HUF 3.7 billion in the past five years (2019-2023).

Energy trading: The revenue increased by 11% due to the higher sales volume. The EBITDA decreased by 3% because of the increasing competition among energy traders.

Results by segments

million HUF	Q2 2024	Q2 2025	Δ
Non-renewables heat and electricity production and management	29056	34636	19%
Renewables-based electricity production	3283	4672	42%
Energy services	2332	2145	-8%
Energy trading	17179	19081	11%
Waste management	2366	2800	18%
Other	4	32	700%
Revenue	49787	54526	10%
	2018 Q3	2019 Q3
Non-renewables heat and electricity production and management	6844	5562	-19%
Renewables-based electricity production	1949	2791	43%
Energy services	-358	-495	38%
Energy trading	1851	1791	-3%
Waste management	761	489	-36%
Other	-1284	-2211	72%
EBITDA	9763	7927	-19%
EBITDA margin
Non-renewables heat and electricity production and management	23,6%	16,1%	-7,5%
Renewables-based electricity production	59,4%	59,7%	0,4%
Energy services	-15,4%	-23,1%	-7,7%
Energy trading	10,8%	9,4%	-1,4%
Waste management	32,2%	17,5%	-14,7%

Source: ALTEO, MBH Investment Bank

Conclusion

We believe the most important takeaway from the latest earnings report is that despite the scheduling service is a high margin segment, the business has become less favorable in recent months as competition is increasing, meaning the margins are and will continue to be under pressure. From the financial model's point of view this means the Nonrenewable heat and electricity production and management segment's EBITDA can be realized at a lower level (see bottom chart). The scheduling services, the balancing activity and the energy storage businesses are an interconnected part of the Non-renewable heat and electricity production and management segment, and these are the main contributors to the segment's EBITDA margin. According to some economic principles a high margin business gives rise to the competition, which means lower profitability in the future. Secondly, the utility sector (like electricity production in this case) is a highly regulated industry, which could mean further margin pressure if the regulator makes decisions that are unfavorable to the Company.

It is important to note that the effect of the new management guidance is almost impossible to forecast with a single DCF model. Since it is a multifactorial model where many factors are unknown and/or unpredictable, like the future cost of debt, the possibility of a secondary share issuance, the expected composition of the new energy portfolio, the functioning of the energy market in the neighboring countries and regulations to name a few, a small error in the prediction of these factors could cause a very misleading company value. However, the statement that the Company could be worth more if such a management strategy were implemented does not have much information content. We don't want to predict the unpredictable, so we continue to value the Company without incorporating the

unknown/unpredictable elements into our model which means that our model and the management's guidance could be differ (even significantly too). We believe that the main point in this situation is the continuous monitoring of the company events and the calibration of our model. In this situation we think the less is more…

Based on our modified DCF-model the one year target price is HUF 5972, our recommendation is buy.

	Equity Value
		Long term growth rate
		0%	3% 6%
Discount	6,7%	84 117	200 771	4 493 479
Rate	8,7%	48 672	99 269	289 921
(WACC)	10,7%	27 715	55 206	122 276
		One Year Target Price
		Long term growth rate
		0%	3%	6%
Discount	6,7%	5 060	12 078	270 318
Rate	8,7%	2 928	5 972	17 441
(WACC)	10,7%	1 667	3 321	7 356

Source: ALTEO, Bloomberg, MBH Investment Bank

DCF, million HUF	2025	2026	2027	2028	2029
Revenue	95 854	138 606	141 047	145 945	154 393
market based, VPP, trading	80 624	80 870	79 722	81 833	87 357
subsidy	5 084	3 686	3 772	3 881	3 994
waste management	6 146	50 050	53 553	56 231	59 042
services	4 000	4 000	4 000	4 000	4 000
EBITDA	23 165	25 401	25 736	25 970	26 636
market based, VPP, trading	16 145	16 096	16 012	15 891	16 186
subsidy	4 459	3 300	3 368	3 456	3 546
waste management	1 560	5 005	5 355	5 623	5 904
services	1 000	1 000	1 000	1 000	1 000
D&A	5 183	7 911	8 132	8 351	8 590
Capex	- 16 665 -	17 120 -	12 319 -	12 516 -	11 731
FCFF	- 4 486 -	1 984	9 012	8 687	9 521
PV of FCFF	14 312
	131 201
	8,67%
PV of TV WACC Net Debt Source: ALTEO, Bloomberg, MBH Investment Bank	46 244
	2025	2026	2027	2028	2029
	62 305	83 163	84 628	87 567	92 636
	37 383	49 898	50 777	52 540	55 582
	49 844	66 531	67 703	70 054
	29 665	20 833	24 918	28 598	33 427
	112 149	149 694	152 331	157 621
	51 327	60 512	70 210	80 118
	50 557	59 302	68 104	76 913	74 109 166 745 89 517 85 937
	35 033	41 248	45 719	50 263
	20 670	24 336	26 974	29 655	32 167
	11 561	13 612	15 087	16 587
	25 789	47 934	36 401	27 240
Balance Sheet, million HUF Non-current assets Property, plant and equipment Current assets Cash and equivalents Total assets Shareholders' equity Retained earnings Non-current liabilities Long-term debt Bonds payable Current liabilities Short-term debt	2 579	4 793	3 640	5 448	54 521 17 992 22 706 4 541

Balance Sheet, million HUF	2025	2026	2027	2028	2029
Non-current assets	62 305	83 163	84 628	87 567	92 636
Property, plant and equipment	37 383	49 898	50 777	52 540	55 582
Current assets	49 844	66 531	67 703	70 054	74 109
Cash and equivalents	29 665	20 833	24 918	28 598	33 427
Total assets	112 149	149 694	152 331	157 621	166 745
Shareholders' equity	51 327	60 512	70 210	80 118	89 517
Retained earnings	50 557	59 302	68 104	76 913	85 937
Non-current liabilities	35 033	41 248	45 719	50 263	54 521
Long-term debt	20 670	24 336	26 974	29 655	32 167
Bonds payable	11 561	13 612	15 087	16 587	17 992
Current liabilities	25 789	47 934	36 401	27 240	22 706
Short-term debt	2 579	4 793	3 640	5 448	4 541
Total liabilities and equity	112 149	149 694	152 331	157 621	166 745

ALTEO Hungary

Csaba Debreczeni Head of Equity Research

Investment Research

MBH Befektetési Bank Zrt. H-1056 Budapest, Váci utca 38. debreczeni.csaba@mbhbank.hu mbhbefektetesibank.hu

Disclaimer

Disclaimer 1

This research/commentary was prepared by the assignment of Budapest Stock Exchange Ltd. (registered seat: 1013 Budapest, Krisztina körút 55.; company registration number: 01-10-044764, hereinafter: BSE) under the agreement which was concluded by and between BSE and by MBH Investment Bank co (registered seat: 1117 Budapest, Magyar Tudósok körútja 9.G.sz; company register number: 01-10-041206; business registration no.: III/41.086/2022, EN-III/M-608/2009; authority: Magyar Nemzeti Bank 55 Krisztina krt., 1013-Budapest, continuously: the Bank). This research/commentary was made with the joint, equally proportional financing of the BSE and the company that is the subject of this research/commentary.

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Disclaimer 2

1.This publication was prepared by MBH Investment Bank Nyrt. (registered seat: 1117 Budapest, Magyar Tudósok körútja 9.G.sz; company register number: 01-10-041206; business registration no.: III/41.086/2022, EN-III/M-608/2009; authority: Magyar Nemzeti Bank 55 Krisztina krt., 1013- Budapest, continuously: the Bank).

2.The findings presented in this document, as an investment analysis, are considered an objective or independent explanation based on Commission delegated regulation (EU) 2017/565, i.e. investment research, and an investment recommendation according to regulation 596/2014/EU of the European Parliament and the Council it counts as. The Bank intends to distribute this document to its customers or the public, or to give access to other persons in such a way that this document may be disclosed to the public.

3.The information contained in this publication does not constitute an offer to buy or sell, nor investment advice, nor does it constitute an incentive, invitation, offer to invest, enter into a contract or make an obligation, nor does it constitute tax advice. The information is not comprehensive, the data contained in the publication are informative. The publication does not constitute investment advice even if any part of the document contains a description of the possible price and yield development of a financial instrument. This document does not consider the unique needs, circumstances and goals of individual investors, so in the absence of a personal recommendation, it does not qualify as investment advice.

The Bank excludes its responsibility for the potential use of the contents of this publication as an investment decision, for specific individual investment decisions, and for the resulting consequences, and therefore does not assume responsibility for any damages or losses that the investor may incur as a result of the decisions made on the basis of the contents of this publication, or in any other connection.

4.The information contained in the publication is based on sources considered to be authentic, however, the Bank has not received a guarantee of the veracity, accuracy, correctness and completeness of the information, therefore neither the authors of the document nor the Bank assumes responsibility for the completeness and accuracy of the information described in the document. The contents and opinions indicated in the publication reflect the professional judgment of the specialists who prepared the publication based on the market conditions existing at the time of the preparation of the publication, which may change without special notice or warning in the event of new information, changes in market conditions and economic conditions. The Bank reserves the right to modify the findings and recommendations contained in this document in the future without prior notice.

5.It is not possible to draw clear and reliable conclusions about future prices, returns, or performance from the past development of prices, yields, and other data. Investors must assess and understand the essence and risks of individual financial instruments and investment services on their own (or with the help of an independent expert). We recommend that investors carefully read the business rules, information, other contractual conditions, announcements, and list of conditions for the given financial instrument and investment service before making a decision to invest, because it is only with knowledge of these documents and information that it can be decided that the investment is in accordance with is it in line with the investor's risk tolerance and investment goals, and also carefully consider the subject of your investment, risks, fees, costs and possible losses and damages resulting from investments! We also recommend that you find out about the tax law and other legislation related to the product and investment, and before making your investment decision, contact our staff or visit your bank advisor!

6. Recommendations

• Overweight: A rating of overweight means the stock's return is expected to be above the average return of the overall industry, or the index benchmark over the next 12 months.

• Underweight: A rating of underweight means the stock's return is expected to be below the average return of the overall industry, or the index benchmark over the next 12 months.

• Equal-weight: A rating of equal-weight means the stock's return is expected to be in line with the average return of the overall industry, or the index benchmark over the next 12 months.

• Buy: total return is expected to exceed 10% in the next 12 months.
• Neutral: Total return is expected to be in the range of -10 +10% In the next 12 months.
• Sell: Total return is expected to be below -10% in the next 12 months.
• Under review: If new information comes to light, which is expected to change the valuation significantly.

7. Change from the prior research

Our first research was published on 15. December 2017. In the Initial Coverage our price target was HUF 823. The changes in fundamental factors and the operation in the Company required regular updates of our model and so the target price. In this report we revised our target price from HUF 6143 to HUF 5972. Our current target price is 3 percent lower than the previous one.

Prior researches

MBH Bank wrote an initiation report on 15 December 2017. The research is available on the web page of the BSE (Budapest Stock Exchange): https://bet.hu/pfile/file?path=/site/Magyar/Dokumentumok/Tozsdetagoknak/Tozsdetagok-elemzesei/MKB-Bank-Alteo-initation-report-20171215.pdf

The flash notes are available on the web page of the BSE (Budapest Stock Exchange): https://bet.hu/Kibocsatok/BET-elemzesek/elemzesek/alteo-elemzesek

8.The Bank is entitled to provide price quotes, other investment services or additional services for the assets included in the publication. The Bank is still entitled in good faith and according to the usual method of market formation to trade, enter into transactions or trade as a market maker in accordance with the usual course of price quotation, as well as to provide other investment activities or additional services, or other financial or additional financial services to the issuer and to other persons.

9.The Bank has a Conflict of Interest Policy for the description of potentially arising conflict of interest situations related to investment service activities and the handling of such situations, as well as internal regulations for the handling and transfer of bank and securities confidential data, which measures are based on the European Commission 2016/958 are considered effective internal organizational and administrative solutions, as well as information limitations, created to prevent and avoid conflicts of interest. The remuneration of the persons participating in the preparation of the analysis is not directly related to the provision of investment service activities defined in Sections A and B of Annex I of EU Directive 2014/65 or to transactions carried out by the Bank or other legal entities belonging to the same financial group, or by the Bank or to the commission received by the company belonging to the same financial group.

10.The issuer of the product/financial instrument covered by this document does not have a share exceeding 5% of the total registered capital of the Bank. The Bank does not act as a liquidity provider with regard to the financial instrument that is the subject of this document. The Bank acts as a market maker with regard to the financial instrument that is the subject of this document. The Bank was not the lead organizer or co-lead organizer of any public issue of the issuer's financial instruments in the previous 12 months. The Bank is not a party to the agreement concluded with the issuer regarding the provision of investment services defined in Sections A and B of Annex I of Directive 2014/65/EU. The Bank does not have a net long or short position exceeding the threshold of 0.5% of the total subscribed capital of the issuer concerned in this document.

11.The Bank has established appropriate internal procedures regarding the personal transactions of (i) financial analysts and other interested persons participating in the preparation of investment-related research; (ii) to ensure the physical separation of financial analysts and other interested persons participating in the preparation of investment analyses; in addition, appropriate information limits were also set (iii) regarding the acceptance of incentives and remuneration.

12.Content of this material enjoys copyright protection according to Act LXXVI. of 1999 on copyright, and may therefore be copied, published, distributed or used in any other form only with prior written consent of MBH Bank. All rights reserved. Unauthorized use is prohibited.

13.This publication is valid at the time of its publication. The date of preparation of the publication: 17:00 02/09/2025

14.The valuation procedures used:

Discounted cash flow valuation

The discounted cash flow valuation is a method of valuing a company (or project, assets, business, etc.) with the time value of the money. The model forecasts the company's free cash flow (free cash flow to firm) and discounts it with the average cost of capital (WACC). The cash flow is simply the cash that is generated by a business and which can be distributed to investors. The free cash flow represents economic value, while accounting metric like net earning doesn't. The WACC represents the required rate of return by the investors. If a business is risky the required rate of return, the WACC will be higher.

Discounted cash flow model (DCF): We analyze the companies using five-year forecast period and set a terminal value based on the entity's long-term growth or on different exit multiples like EV/EBITDA or EV/EBIT. In certain cases the forecast period may differ from

five years. In this case the analysts must define the reason for difference. The cash flows are discounted by the company's WACC unless otherwise specified.

In the first step we forecast the company's cash flow. The free cash flow to firm (FCFF) is based on the earnings before interest and taxes (EBIT), the tax rate, depreciation and amortization (D&A), net change in working capital (which is based on the current assets and current liabilities) and the capital expenditures (CAPEX). The model requires a terminal value which can be based on the long-term growth or on an exit multiple like EV/EBITDA, or EV/EBIT. Forecasting the terminal value is a crucial point because in most cases it makes up more than 50% of the net present value.

The discount rate (WACC): The average cost of capital of the company is dependent on the industry, the risk-free rate, tax, the cost of debt and the equity risk premium. The cost of equity is calculated by the CAPM model, where the independent variables are the riskfree rate, the industry specific levered beta, and the equity risk premium. The WACC is dependent on the capital structure, so the forecast of the equity/debt mix is crucial.

At the end we get the enterprise value (EV). The EV is the market capitalization plus the total debt and preferred equity and minority interest, minus the company's cash. In the last step we reduce the EV with the net debt. This figure divided by the shares outstanding we arrive at the target share price.

The discounted cash flow model includes sensitivity analysis which takes the effects of the change in the WACC, the long-term growth or the used exit multiples on which the terminal value is based.

Our target price is based on a 12-month basis, ex-dividend unless stated otherwise.

Peer group valuation: For comparison we use peer group valuation. The analysis based on important indicators and multiples like P/E, EV/EBITDA, EV/EBIT, market capitalization, P/S, EBITDA margin, net debt to EBITDA, EBITDA growth, dividend yield and ROIC. If the industry justifies we may use other multiples. The peer group is compiled according to the companies' main business, with respect to the region (DM or EM market).