BAIRD 2025 GLOBAL INDUSTRIALS CONFERENCE UNION PACIFIC CORPORATION JIM VENA – CHIEF EXECUTIVE OFFICER JENNIFER HAMANN – CHIEF FINANCIAL OFFICER Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be 1 Cautionary Information 2 3 Strategic Execution Driving Industry Leading Results SAFETY + SERVICE & OPERATIONAL EXCELLENCE 210 219 215 221 226 238 Q3'24 Q4'24 Q1'25 Q2'25 Q3'25 Q4'25** 86% 89% 94% 99% 98% 100% 89% 96% 93% 97% 100% 100% Q3'24 Q4 ...

Core Insights - Getty Images reported third quarter results that met expectations, with top-line growth flattening due to challenging year-over-year comparisons against a strong event calendar from the previous year [2] - The company finalized strategic partnerships to integrate its content into emerging AI platforms, which are expected to create new revenue streams aligned with its traditional business [2] - The company remains confident in its value proposition and is focused on disciplined execution against its 2025 outlook [2] Financial Performance - Revenue for Q3 2025 was $240.0 million, a slight decrease of 0.2% year-over-year and 2.0% on a currency-neutral basis [6] - Creative revenue increased by 8.4% year-over-year to $144.9 million, while editorial revenue decreased by 3.7% to $89.3 million [6] - Annual subscription revenue grew to 58.4% of total revenue, up from 52.4% in Q3 2024 [6] - Net income for Q3 2025 was $21.6 million, compared to a net loss of $2.5 million in Q3 2024, resulting in a net income margin of 9.0% [6][15] - Adjusted EBITDA was $78.7 million, down 2.4% year-over-year, with an adjusted EBITDA margin of 32.8% [6][15] Liquidity and Balance Sheet - The company had an ending cash balance of $109.5 million as of September 30, 2025, down from $121.2 million at the end of 2024 [6][35] - Total debt was $1.38 billion, which included $539.9 million in senior secured notes and $543.6 million in term loans [15] - The company has $150.0 million available through its revolver, resulting in total available liquidity of $259.5 million [7] Key Performance Indicators - Total purchasing customers decreased by 2.3% year-over-year to 703,000, while active annual subscribers increased by 1.7% to 304,000 [10] - Paid download volume decreased by 1.3% to 93 million, and the annual subscriber revenue retention rate fell to 90.3% [10] Financial Outlook - The updated revenue guidance for 2025 is between $942 million and $951 million, reflecting a year-over-year growth of 0.3% to 1.2% [14] - Adjusted EBITDA guidance for 2025 is set between $291 million and $293 million, indicating a year-over-year decline of 3.0% to 2.3% [16] Merger and Legal Developments - Getty Images is in the process of merging with Shutterstock, with the transaction expected to close in 2026, pending regulatory approvals [19] - The company recently won a trademark infringement case against Stability AI, establishing a precedent for copyright claims related to AI-generated outputs [21][22]

Core Viewpoint - Greencore has addressed UK competition concerns regarding its acquisition of Bakkavor by proposing to sell a soups and sauces plant, moving closer to completing the deal early next year [1][3]. Group 1: Acquisition Details - Greencore is in discussions with potential buyers for its chilled soups and sauces manufacturing facility located in Bristol, which generates annual revenue of approximately £47 million ($61.5 million) [2]. - The Bristol facility is the only one operated by Greencore in the soups and sauces category, which was flagged by the Competition and Markets Authority (CMA) as a potential competition conflict [3]. Group 2: Regulatory Approval - The CMA has provisionally accepted the remedies proposed by Greencore, indicating that these measures could alleviate competition concerns [4]. - Joel Bamford, the CMA's executive director for mergers, stated that the remedies have the potential to address the competition issues identified during the investigation [4]. Group 3: Financial Impact - The revenue from the Bristol plant accounts for about 1% of Greencore's total sales for the year ending September 26, with expected total revenue of £1.95 billion for fiscal 2025 [5]. - Bakkavor's adjusted operating profit outlook remains unchanged at £120-126 million for fiscal 2025, with previous year sales reported at £2.3 billion [6].

Core Viewpoint - DNOW Inc. has successfully completed its acquisition of MRC Global Inc., creating a leading solutions provider in the energy and industrial markets [1][11]. Company Overview - DNOW is a premier energy and industrial solutions provider with over 160 years of experience, specializing in the distribution of pipe, valves, fittings, pumps, and fabricated equipment [5]. - The company is headquartered in Houston, Texas, employing approximately 5,000 individuals and operating a global network of distribution and engineering locations [5]. Merger Details - Under the merger agreement, each share of MRC Global's common stock was converted into the right to receive 0.9489 shares of DNOW's common stock [2]. - The total value of the all-stock transaction is approximately $1.5 billion, which includes MRC Global's net debt [13]. Strategic Benefits - The merger is expected to enhance DNOW's earnings durability, cash flow, and financial position, allowing the company to capitalize on growth opportunities across various sectors [3]. - DNOW anticipates generating $70 million in annual cost synergies within three years post-merger through operational efficiencies and streamlined corporate structures [6]. Market Position and Growth Opportunities - The combined entity will serve a broader mix of customers in essential energy infrastructure, including sectors such as chemical processing, municipal water, utilities, mining, and power generation [6]. - The merger expands DNOW's geographic footprint and distribution presence across the U.S., Canada, and other international markets, with over 350 service and distribution locations in more than 20 countries [6].

Core Insights - Saks Global is undergoing a leadership shakeup as it approaches the first anniversary of its acquisition of Neiman Marcus Group for $2.7 billion [1] - Several longtime executives have departed, including Chief Operating Officer Rob Brooks and Chief Transformation Officer Bill Bine, with their responsibilities being redistributed [2][3] - The company has experienced significant turnover, which is unusual for a merger and acquisition context, raising concerns about the vetting process during the acquisition [4][6] Executive Departures - Recent departures include John Antonini, Larry Bruce, James Newell, and Will Cooper, alongside a series of layoffs since the merger announcement [3] - The company claims that the leadership changes reflect progress in integration plans and a move towards a simplified leadership structure [5] Integration and Transformation Strategy - Saks Global emphasizes that it has made significant progress on integration plans faster than anticipated, focusing on enhancing customer experience, brand partner relationships, and financial performance [5] - Experts suggest that the rapid turnover of executives post-acquisition indicates potential issues with the company's vetting process [6]

Core Viewpoint - Kimberly-Clark's nearly $50 billion acquisition of Kenvue is seen as a risky move, relying on the continued growth of the U.S. consumer market despite budget constraints faced by lower-income shoppers [1] Deal Overview - The cash-and-stock deal is expected to close late next year, expanding Kimberly-Clark's portfolio into faster-growing categories like skin care and pain relief, which offer higher margins compared to its existing products [2] - Kimberly-Clark's CEO emphasized plans to leverage their product innovation strategy to revitalize Kenvue's faltering sales, focusing on baby care, women's health, and products for older consumers as key growth areas [3] Investor Reaction - Following the announcement, Kimberly-Clark's shares fell by 14.6%, indicating investor skepticism about the merger, while Kenvue's shares rose by 12.3%, reflecting a 46% premium on Kenvue's valuation [5] - Analysts noted that Kimberly-Clark's market cap decline was greater than Kenvue's gain, suggesting a lack of confidence in the merger's potential [5] Strategic Concerns - Analysts from BNP Paribas questioned the strategic fit of the merger, citing a lack of overlap in product offerings that could hinder cost-saving synergies [6] - Concerns were raised about the impact of weakening consumer purchasing power, particularly among less affluent Americans facing rising healthcare costs and potential loss of federal food benefits [6]

Key Points Kimberly-Clark will buy Kenvue for $48.7 billion. A merged Kimberly-Clark-Kenvue could have $32 billion in annual sales and profits as high as $5.5 billion. At Kimberly-Clark's current $40 billion market cap, this implies a 7.3x P/E ratio on the merged stock. 10 stocks we like better than Kimberly-Clark › Kimberly-Clark (NASDAQ: KMB) stock tumbled 12.5% through 10:25 a.m. ET Monday, and it's not hard to figure out why. This morning, K-C announced it will acquire Tylenol-maker Kenvue (N ...

Core Viewpoint - Kimberly Clark is set to acquire Ken View for over $40 billion, with a significant equity component in the deal, potentially lowering the cash value of the transaction [1][5]. Company Overview - Ken View has faced organizational challenges, including the removal of its CEO and ongoing struggles since its spin-off from Johnson & Johnson, despite having a strong brand portfolio that includes Tylenol and Listerine [2][4]. - Kimberly Clark has been interested in acquiring Ken View for an extended period, previously attempting a reverse Mars trust deal to separate it from J&J before the spin-off [8]. Financial Aspects - The proposed acquisition includes $2.1 billion in cost synergies, with $1.9 billion primarily from cost reductions, and additional revenue synergies anticipated [4][5]. - The deal structure involves a cash component of $3.50 per share and a stock component, with Ken View shareholders expected to own 46% of the combined entity [5][7]. - The acquisition is priced at a 50% premium, but the overall valuation is impacted by Kimberly Clark's declining share price, leading to a deal multiple of approximately 14.5 times, below the typical median of 18 times for similar transactions [6][10]. Market Implications - The merger aims to create a competitive portfolio that could rival Procter & Gamble, with hopes of achieving a market multiple closer to that of P&G or Colgate in the future [3][7]. - The acquisition is expected to be accretive over time, allowing for potential upside as synergies are realized and Ken View's business is reorganized [4][7].

Core Viewpoint - The UK's Competition and Markets Authority (CMA) has referred the proposed merger between Shutterstock and Getty Images to a Phase 2 review process, despite Getty Images offering remedies to avoid this outcome. Shutterstock expresses disappointment but remains committed to the merger and plans to work with the CMA and Getty Images to secure necessary clearances [1]. Company Overview - Shutterstock operates as a platform that transforms ideas into impactful outcomes, leveraging a global network of creators and advanced technology to provide essential resources for businesses and creatives. The company boasts the world's largest and most diverse collection of high-quality licensable assets, data, AI solutions, and full-service studio production [2]. Merger Details - The proposed merger involves significant regulatory scrutiny, as indicated by the CMA's decision to escalate the review process. This development highlights the complexities and challenges associated with large-scale mergers in the creative and media sectors [1][9].

Core Viewpoint - SM Energy and Civitas Resources have announced a definitive merger agreement involving an all-stock transaction, creating a leading independent oil and gas company with significant free cash flow and enhanced stockholder value [2][3][5] Transaction Details - Each common share of Civitas will be exchanged for 1.45 shares of SM Energy common stock, resulting in a combined enterprise value of approximately $12.8 billion, inclusive of net debt [3][7] - Upon completion, SM Energy stockholders will own approximately 48% and Civitas stockholders will own approximately 52% of the combined company [7] Financial Metrics - Pro forma second quarter of 2025 production is projected to total 526 MBoe/d, with full-year 2025 consensus free cash flow expected to exceed $1.4 billion [1][4] - The merger is anticipated to be immediately accretive to key per share financial metrics, including operating cash flow and free cash flow [10] Synergies and Value Creation - Identified annual synergies of approximately $200 million, with potential upside to $300 million, are expected to enhance stockholder value and support accelerated debt repayment [5][10] - The combined company will operate a premier asset portfolio of approximately 823,000 net acres across high-return U.S. shale basins, positioning it as a top-10 independent oil-focused producer [4][5] Governance and Leadership - The Board of Directors will consist of 11 members, with 6 from SM Energy and 5 from Civitas, and Herb Vogel will serve as CEO of the combined company [8] - The merger has been unanimously approved by the boards of both companies and is expected to close in the first quarter of 2026, subject to customary closing conditions [11]