No-Moat ALS on a Sound Trajectory; FVE Increased to AUD 6.75

We increase our fair value estimate for no-moat ALS by 6% to AUD 6.75. Some is due to time value of money, but we also increase revenue and earnings expectations for the life sciences segment. Our fiscal 2023 and fiscal 2024 EBITDA forecasts for life sciences increase 12% to AUD 324 million and 25% to AUD 363 million, respectively. Life sciences currently comprises just over half of group earnings, and we increase our fiscal 2023 and fiscal 2024 EPS forecasts by 4% and 12% to AUD 0.55 and AUD 0.64, respectively. Favourable macroeconomic trends support stronger growth expectations for key life sciences end-markets than we had previously credited. Our earnings forecasts equate to fiscal 2023 and fiscal 2024 P/Es of 20 and 18 at the current share price.