Model update – modest EPS changes as FX offsets weaker organic We update our DGE model following its recent Q3 trading update and Guinness deep-dive event. We keep our earnings estimates broadly unchanged as organic downgrades for FY26 (from +3.4%/+4.2% organic sales/EBIT to +2.7%/+3.5%) are largely offset by FX tailwinds. Following +5.9% organic sales growth in Q3 (+2% ex-tariff phasing), we model -0.6% decline in Q4 – this drives FY25 organic sales +1.6% and organic EBIT -0.9% to $5,701m with adj EPS -8.5% to $1.64. Welcome focus on costs, cash and internal controllables While performance in ~1/4 of the portfolio is robust (Tequila at c.15% sales, Guinness at c.10%), the rest of the portfolio is modest at best, impacted by myriad factors across DGE’s key geographies (e.g. affordability, abstinence, tariffs). We see some signs of green shoots for DGE based on an improving launch pipeline and resilient market shares, but for the time being, we expect subdued markets to persist into FY26. With this in mind, we welcome management’s greater emphasis on costs (c.$500m 3-year gross savings under the Accelerate program) and cash (>$3bn FCF per annum commitment from FY26). Details on delivery and phasing will come with FY25 results on 5 August. Patience required to see benefits come through For now, we stay HOLD as it will likely take some time for the cost actions to come through and external visibility remains very limited (e.g. US tariffs). Management’s deleverage priority from 3.3-3.5x EBITDA in FY25 towards c.2.5x by FY28 likely includes “significant” disposals (we estimate up to c.$1bn over the period). Shares are -22% ytd with valuation on 16.1x cal.25 P/E trading just back in line with the wider Beverages (17.0x) and Spirits sector averages, also supported by a c.4% dividend and >4% FCF yield.