Water Quarterly

Home , Essential Utilities, United Utilities, Weir Group

INVESTMENT BANKING SUMMER 2021

IN THIS ISSUE WATER QUARTERLY Deal in Focus 3 MERGERS & ACQUISITIONS, PUBLIC & PRIVATE FINANCINGS Outsourced O&M Service Providers 4-6 AND FINANCIAL ADVISORY SERVICES Sector & Economic Indicators 7-9 Trading and M&A Comparables 10-22

For Institutional Use Only WATER QUARTERLY

Learn how our deep industry Your success is our business expertise and commitment to each transaction can help you Companies developing and utilizing creative solutions to help solve the world’s growing water achieve your business objectives. problems can turn to the Raymond James Water team for results. The team’s expansive industry relationships and deep market insight allow us to provide comprehensive service to our clients, BRENDAN TIERNEY particularly those addressing the industry’s biggest secular trends: water scarcity, water quality and Managing Director aging infrastructure. Global Head of Water +1.212.856.4387 As one of the only investment banking teams with a dedicated focus on the industry, you can expect [email protected] informed advice and quality results. ALASTAIR ROGERS Managing Director European Sustainability #1 Global Water Investment Bank(1) +44.20.3798.5744 Transactions represent Raymond James' industry-leading 29th, 30th and 31st water [email protected] transactions since 2016 FLORIAN STOEGER Director (2) July 2021 June 2021 June 2021 European Water +49.69.21.93.3722 [email protected]

CLANCEY CROWLEY Vice President Has been acquired by Initial public offering Has acquired Americas Water +1.212.885.1821 [email protected]

C$175,000,000 ADAM GRAVITT Associate Americas Water +1.212.883.6595 [email protected]

RAYMOND JAMES INVESTMENT BANKING 2 Note: “#1 Water Investment Bank” refers to number of transactions in the Water sector relative to other banks since 2016. (2) Transaction execution led by RJ Canada Ltd. SUMMER 2021

S.J. Electro Systems, Inc. acquired by Audax Private Equity TRANSACTION OVERVIEW • On June 28th 2021, S.J. Electro Systems, Inc. (“SJE” or the “Company”), a Minnesota-based, leading controls technology company for the water and wastewater industry throughout the United States and Canada, as well as global markets, was acquired by Audax Private Equity (“Audax”) • Raymond James’ Global Water Advisory team served as financial advisor to Audax COMPANY OVERVIEW RATIONALE • SJE operates globally through seven locations with • “As demand for our products continues to grow, we Second Quarter a worldwide customer base believe that now is the right time to bring on a • SJE’s well-respected brands – CSI Controls, partner that can provide strategic capital as well as PRIMEX, SJE Rhombus – offer a wide variety of operational and financial expertise.” – Dave Deal in Focus control products for residential, commercial, Thomas, President & Chief Executive Officer, SJE municipal and industrial markets • Strong industry tailwinds, including: aging water • SJE has consistently executed in the highly infrastructure requiring significant investment, fragmented water controls market and has grown regulatory pressure necessitating equipment both organically and through six acquisitions since upgrades, and need for replacement of existing 2005 controls due to extreme weather events • Highly fragmented water controls market presents significant opportunity to “roll up the tail” REPRESENTATIVE PRODUCTS

Build-a-Panel™ EZ Series Pump Level Monitoring Control Panels Control Panels Control Solutions

RAYMOND JAMES VALUE-ADD

Value creation strategy M&A bolt-ons Valuation

Crafted value creation strategies by Compiled list of M&A bolt-on targets Supported valuation analyses, factoring in: segment for SJE to pursue to create a across water/wastewater spectrum to precedent M&A analysis of 20+ previous roadmap for the “SJE of the future” support inorganic growth strategy transactions, public comparables analysis, and sum-of-the-parts analysis

Industry analysis Exit considerations

Performed analysis of macro trends Compiled likely buyer universe of SJE and indicators to assess the overall upon Audax exit and detailed key macro-economic potential impact to positioning of SJE to select buyers SJE across various scenarios

Sources: Company information, press release. RAYMOND JAMES INVESTMENT BANKING 3 WATER QUARTERLY SUMMER 2021

INCREASING CONSOLIDATION IN OUTSOURCED O&M SERVICE PROVIDERS

O&M OVERVIEW initiatives often neglected when working for treatment needs while they focus on core operations. municipalities. In addition, O&M providers are leaning Water and wastewater treatment is a non- MARKET FOR O&M SERVICES on technology (IoT, SCADA, etc.) to address labor discretionary and, typically, non-core service required shortages by creating more efficiencies in the Total spend on O&M services for the municipal and to deliver clean water and return safe wastewater for a workforce. industrial markets is estimated to be $80 billion and variety of municipal, commercial and industrial $10 billion, respectively. Of the total market, purposes. Municipalities, privately-owned water & B. INCREASINGLY COMPLEX OPERATIONS outsourced O&M for municipal and industrial markets wastewater systems and industrial manufacturers are Increasingly advanced treatment systems needed to is estimated to be $2 billion and $0.2 billion, increasingly utilizing outsourced providers for treat today’s contaminants has led to more complex respectively. With a highly fragmented base of small- operations & maintenance (“O&M”) services. O&M operations to maintain such systems. The rise of scale utilities and plethora of industrial manufacturers, services can include: numerous and various types of membranes and significant opportunity exists for growth in the • Water & wastewater distribution and collection treatment processes, including water reuse and outsourced O&M market. system management; recycling, are among examples that lead to MUNICIPAL MARKET increasingly complex operations. As such, proper • Biosolids management; training, certification and expertise are required for ($ in billions) $2 • Asset management; operations that many entities often find advantageous to outsource. • Supervisory Control and Data Acquisition (“SCADA”); C. INCREASING REGULATIONS AND COMPLIANCE ~$82 billion FACTORS market • Smart metering; and, Contract O&M services offer the opportunity to either • Customer service and billing. completely pass or share risk associated with water & $80 Factors contributing to the increased utilization of wastewater treatment. With an ever-increasing outsourced O&M services include: (A) aging municipal regulatory framework and compliance on maximum workforce, (B) increasingly complex operations, (C) contaminant limits (“MCLs”) for certain contaminants, coupled with the impact of aging infrastructure, increasing regulations and compliance factors and (D) INDUSTRIAL MARKET decreasing emphasis on non-core operations. Such treatment system operators seek such opportunities factors also support implementation of cost-saving to minimize overall risk, especially given the degree of $0.2 initiatives. potential personal liability involved in water & wastewater treatment. A. AGING WORKFORCE D. DECREASING EMPHASIS ON NON-CORE ~$10 billion The municipal workforce is continuing to see OPERATIONS increasing numbers of its aging workforce retire, market requiring the need for significant backfill. A lack of Industrial manufacturers are increasingly desire to work in such fields by a younger generation is deemphasizing non-core operations to place more $10 placing strain on municipal operations. As such, attention on revenue generating operations. While outsourced O&M service companies provide an water & wastewater systems are an important opportunity to “professionalize” that career path by component of industrial manufacturing, they are more offering specified training and career enhancement open to permitting "water" experts to address their Insourced O&M Outsourced O&M

Source: U.S. Congressional Budget Office, Public Spending on Transportation and Water Infrastructure, Bluefield Research, Amane Advisors, Raymond James Water team. RAYMOND JAMES INVESTMENT BANKING 4 WATER QUARTERLY SUMMER 2021

INCREASING CONSOLIDATION IN OUTSOURCED O&M SERVICE PROVIDERS (CONT’D)

O&M SERVICE PROVIDER SEGMENTS O&M SERVICES SEGMENTS MUNICIPAL UTILITY DISTRICTS (CONT’D) Service providers within the O&M market can be Services provided can be segmented into the following segmented into four different categories, which are categories, which vary by services performed and based on company size, scope, geographic footprint customer: Contract operations (“Con Ops”), Municipal and number of systems a company serves: Utility Districts (“MUDs”), and Infrastructure Management Services (“IMS”). • Investor Owned Utilities (“IOUs”) – private El Paso Dallas utilities that pursue market-based business CONTRACT OPERATIONS 34 through O&M 14 Con Ops are utilized for the following customer base San Austin • Diversified water – Diversified companies that and are multi-year agreements with generally high Antonio provide O&M services to a large and wide-reaching renewal rates: 137 population base across the U.S. 7 • Municipalities - Local administrative divisions 762 • Regional – Companies that provide O&M services responsible for providing water and wastewater to both small and large systems within a specific treatment Houston region • Privately owned utilities - Water and wastewater • Local – O&M services to smaller systems with systems or infrastructure owned by private entities Number of MUDs contracts limited to a single state • Industrial manufacturers - Industrial plants across end markets treating water used in 1% industrial process (incl. wastewater effluent) INFRASTRUCTURE MANAGEMENT SERVICES MUNICIPAL UTILITY DISTRICTS IMS are complementary offerings of outsourced 11% administrative and support services for communities, MUDs are political subdivisions authorized to provide which are typically sold alongside water and water, sewage, drainage and other utility-related wastewater O&M outsourcing. Services can include services within recognized boundaries. The market is financial services (e.g., accounting, tax, etc.), O&M Contract most developed in Texas where extensive administrative management (e.g., record keeping), Share by 48% development has occurred in areas distant from and infrastructure support (e.g., landscape Number of existing municipal infrastructure, requiring new maintenance). Typical customers can include: Contracts water/wastewater treatment facilities. Each MUD is a 40% government that has the legal authority to issue the • Homeowners associations – Neighborhood sale of bonds and tax the property owners to repay the organizations that make and enforce rules for its bonds and maintain district infrastructure. properties and are responsible for the management of all dedicated infrastructure Most MUDs are managed and operated by contract operators across Texas. On average 40 - 50 new MUDs • Community development districts - Special are added every year, leading to 250 - 300 new purpose unit of local government for building and Local Diversified water players Regional IOUs connections per year with highest growth expected in operation of Florida communities Houston and Austin.

Source: Bluefield Research, Amane Advisors, Raymond James Water team, Capital IQ. RAYMOND JAMES INVESTMENT BANKING 5 WATER QUARTERLY SUMMER 2021

INCREASING CONSOLIDATION IN OUTSOURCED O&M SERVICE PROVIDERS (CONT’D)

O&M SERVICES CONSOLIDATION M&A OPPORTUNITY FOR LARGER MARKET M&A OPPORTUNITY FOR PRIVATE EQUITY PARTICIPANTS The outsourced O&M services market has seen a The outsourced O&M services market is highly significant amount of consolidation across larger Opportunity exists to acquire “consolidators” of fragmented and represents a significant opportunity market participants and PE-backed consolidators as significant scale that have grown organically and/or for platform companies to engage in meaningful bolt- inorganic growth through M&A remains a realistic, inorganically through bolt-on M&A. Acquisition of on acquisitions to “roll-up the tail”. Identifying high-ROI strategy for growth. Nationwide providers in larger players offers the opportunity to expand targeted geographies for expansion is likely to result in the O&M market seek opportunities across the United customer base through geographic expansion, realize the identification of a local outsourced O&M provider States and abroad in high-growth and opportunistic economies of scale, enhance knowledge sharing to seeking capital infusion. The greater the geographic geographies. drive increase operating efficiencies, and more. density, the greater opportunity for efficiencies and profitability. 500+ Local/regional O&M providers throughout the United States

Date Acquiror Target Target description

April 2021 O&M services for MUDs in Houston

Infrastructure services, including O&M for December 2020 water/wastewater infrastructure O&M services for MUDs in Houston and October 2020 / surrounding area O&M services for water/wastewater July 2020 infrastructure in Texas Outsourced water/wastewater treatment April 2020 Morgan Stanley Infrastructure Partners and reuse solutions Water/wastewater asset management November 2018 services for MUDs in Texas Rights to 23 water treatment and energy July 2018 Service Contracts service contracts Consulting, design, construction, and December 2017 operations services Infrastructure services, including O&M for July 2017 water/wastewater infrastructure Source: Bluefield Research, Amane Advisors, Raymond James Water team, Capital IQ. RAYMOND JAMES INVESTMENT BANKING 6 WATER QUARTERLY SUMMER 2021

Macro Indicators

US ECONOMY GDP Growth Inflation vs Unemployment(1) S&P 500 Index

10.0% 20.0% 5,000 5.8% 4.0% 15.0% 4,000 5.0% 3.0% 2.2% 3,000 10.0% 2,000 0.0% 5.0% 1,000 -5.0% 0.0% 0 -3.5%

Inflation (core) Unemployment Rate EUROPE ECONOMY GDP Growth Inflation vs Unemployment(1) STOXX 600 Index

8.0% 12.0% 4.2% 4.0% 500 1.9% 4.0% 1.3% 8.0% 400 0.0% 300 4.0% 200 -4.0% 0.0% 100 -8.0% 0 -6.8% -4.0%

Inflation (core) Unemployment Rate CHINA ECONOMY GDP Growth Inflation vs Unemployment(1) Hang Seng Index

10.0% 8.3% 8.0% 40,000 6.8% 5.9% 5.3% 30,000 5.0% 4.0% 20,000 2.3% 10,000 0.0% 0.0% 0 -4.0%

Inflation (core) Unemployment Rate

Source: Bloomberg, FactSet. Market data as of 6/30/2021. RAYMOND JAMES INVESTMENT BANKING 7 WATER QUARTERLY SUMMER 2021

Select Water End Market Indicators

AGRICULTURE INDUSTRIAL US Corn Futures(1) US PMI EU PMI

500 100 100 400 80 80 300 60 60 200 40 40 100 20 20 0 0 0

US MUNICIPAL

Muni Bond Issuance ($ billions)(2) AAA 10-Yr Muni Index to 10-Yr Treasury Ratio(2) Water Utility Employment (000s)(2)

100 460 57.0 80 360 54.0 60 260 51.0 40 20 160 48.0 0 60 45.0

RESIDENTIAL & CONSTRUCTION US Building Permits (000s) German Building Permits (000s) US Ductile Iron Pipe Pricing

160 25 $350 140 20 $330 120 15 $310 100 10 $290 80 5 $270 60 0 $250

Source: Bloomberg, Municipal Securities Rulemaking Board, Bureau of Labor Statistics. Market data as of 6/30/2021. (1) Corn Futures Contract from Chicago Board of Trade. Contract size is 5,000 bushels. (2) Values for June 2021 have not yet been made publicly available. RAYMOND JAMES INVESTMENT BANKING 8 WATER QUARTERLY SUMMER 2021

Water Scarcity Indicators

NASDAQ Veles California Water Index (NQH2O)(1) ($ Per Acre Foot) The NQH2O Index benchmarks the price of water across California in a way that supports price discovery and enables the creation of a tradable financial 1000 instrument. 800 600 400 200 0 06/2015 12/2015 06/2016 12/2016 06/2017 12/2017 06/2018 12/2018 06/2019 12/2019 06/2020 12/2020 06/2021

Palmer Drought Severity (“PDSI”) Index(2) The PDSI Index uses readily available temperature and precipitation data to estimate relative dryness nationwide. Positive numbers indicate wet periods, zero is normal, and negative numbers indicate droughts.

Wet Periods

Droughts

State Water Project (SWP) Long-term Water Supply Contract Allocation Levels(3)

The allocation is the % of each long-term water user’s contracted volume that the state will actually provide during a given year. In dry years, the allocation is lower because less water is available for delivery. In wet years, the allocation is higher because more water is available for delivery. 85% 75% 60%

35% 20% 10% 10%

2015 2016 2017 2018 2019 2020 2021 YTD

(1) Bloomberg. Market data as of 6/30/2021. Used with permission from NASDAQ. (2) U.S. Department of Commerce, National Environmental Satellite, Data, and Information Service, as of 3/31/2021. Values for November 2020 through June 2021 have not been released. (3) California Department of Water Resources, as of 6/30/2021. RAYMOND JAMES INVESTMENT BANKING 9 WATER QUARTERLY SUMMER 2021

M&A Overview

Middle Market ($50 Million of EBITDA or Less) LBO Purchase Price and Net Leverage Multiples(1)

12.9x

11.6x 10.7x 10.6x 10.2x 9.6x 9.3x 8.8x 8.5x 8.3x 8.4x 8.1x 8.2x 7.9x 7.0x 7.2x 6.7x 6.6x

5.8x 5.3x 5.5x 5.5x 5.4x 5.0x 5.3x 5.1x 4.7x 4.6x 4.3x 4.5x 4.3x 4.3x 4.5x 3.7x 3.8x 3.2x

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Total Leverage Purchase Price Multiple

Recent Select Water Transactions

Date Transaction EV / LTM Announced Buyers/Investors Target Target Description Value ($mm) Revenue EBITDA

6/28/21 Ingersoll Rand Inc. Maximus AG Systems Farm building management systems for the agritech market $109.8 3.4x - 6/21/21 Ingersoll Rand Inc. SEEPEX GmbH Cavity pumps for delivering highly-viscous, aggressive media $514.1 2.7x - 6/17/21 Nalka Invest AB Uniwater AB Prefabricated pumping stations and VA-technical solutions - - - 6/14/21 Mueller Water Products, Inc. i2O Water Ltd. Pressure management technology platform $20.0 - - 6/14/21 Not Disclosed Aquaporin A/S Develops and sells products to clean drinking water - - - 6/7/21 De Nora Water Technologies UV Technologies Division of Calgon Corp. Water management and treatment systems - - - 5/27/21 XRI (Morgan Stanley Energy) Hibernia's Water Infrastructure Assets Delivery of complations water and handling of produced water - - - 5/25/21 Advent International Corporation; BDT Capital Partners,Culligan LLC International Company Water purification and treatment products - - - 5/20/21 Tank Holding (Olympus) Rotational Molding of Utah Manufactures proprietary tanks, pallets and refuse products - - - 5/17/21 Franklin Electric Co., Inc. New Aqua, L.L.C. Commercial and industrial water treatment products $150.0 2.2x - 5/5/21 Valmont Industries, Inc. Prospera Technologies Ltd. Software platform that monitors and analyzes plant health $300.0 - - 5/3/21 Brentwood Associates, Inc. Watermill Express, LLC Operator of drinking water stations - - - 4/29/21 Bentley Systems, Incorporated sensemetrics, Inc. Sensor platform solutions for natural resources and water - - - Sources: S&P LCD, CapIQ, MergerMarket, press releases and Raymond James internal resources. (1) Data is unavailable for 2020 due to an insufficient number of observations available. RAYMOND JAMES INVESTMENT BANKING 10 WATER QUARTERLY SUMMER 2021

Select Recent Transactions (cont’d)

Date Transaction EV / LTM Announced Buyers/Investors Target Target Description Value ($mm) Revenue EBITDA

4/28/21 SPX FLOW, Inc. Philadelphia Mixing Solutions, Ltd. Fluid mixing equipment and process optimization solutions $65.0 1.3x - 4/20/21 Pentair plc Assets of Ken's Beverage, Inc. Beverage equipment and service to commercial customers $80.0 - - 4/6/21 Pennsylvania-American Water Company, Inc. Assets of York City Sewer Authority Wastewater provider for the city of York $235.0 - - 4/6/21 Evoqua Water Technologies Corp. Water Consulting Specialists, Inc. Industrial water treatment solutions $12.0 - - 4/3/17 Spirax-Sarco Engineering plc GESTRA AG Manufactures valves and control systems $190.9 1.9x 10.8x 4/1/21 Komline-Sanderson Corporation Harn R/O Systems, Inc. Manufactures membrane treatment solutions - - - 4/1/21 Franklin Electric Co., Inc. Puronics Water Systems, Inc. Manufactures water treatment equipment $28.0 1.2x - 3/24/21 Komline-Sanderson Corporation Barnes International, Inc. Coolant filtration equipment manufacturer - - - 3/17/21 Aquatic Informatics Inc. Sedaru, Inc. Water utility management software provider - - - 3/10/21 Fluidra, S.A. Custom Molded Products, Inc. Pool, spa and bath product manufacturer $245.0 2.2x - 2/24/21 Autodesk, Inc. Innovyze, Inc. Water infrastructure software provider $1,038.3 - - 2/22/21 Partners Group AG Resilient Infrastructure Group, LLC Water, wastewater and related infrastructure assets - - - 2/22/21 Quikrete Holdings, Inc. Forterra, Inc. Water and drainage infrastructure product manufacturer $2,791.6 1.8x 10.2x 2/17/21 KKR & Co Flow Control Group Specialty flow control and fluid handling products distributor - - - (1) 2/16/21 New Mountain Capital Aegion Corporation Infrastructure maintenance, rehabilitation and protection solutions $1,154.2 1.5x 8.6x 2/10/21 Polypipe Group plc (nka:Genuit Group plc) Adey Innovation LLP Heating & cooling system an water treatment product provider $290.7 4.1x 11.7x 2/9/21 WILO SE ABIONIK Group GmbH Water and air purification equipment provider - - - 2/2/21 Parkson Corporation Schreiber Wastewater treatment equipment manufacturer - - - 2/1/21 H2O Innovation Inc. Genesys Membrane Products, S.L. RO membrane laboratory services $9.9 1.6x 6.0x 1/14/21 Management of Atonix Digital Atonix Digital Infrastructure data analytics software solutions - - - 1/14/21 Alfa Laval 20% of AMI Global End-to-end industrial IoT solutions for rotating equipment - - - 1/13/21 Fluidra, S.A. Built Right Pool Heaters LLC Swimming pool heat pump manufacturer - - - 1/12/21 Alfa Laval Sandymount Technologies Corporation Beer concentration membrane technology - - - 1/11/21 Saur SAS Aquapor Portuguese municipal water concessions manager - - - 1/11/21 Idex Corporation Abel Pumps Highly-engineered displacement pumps manufacturer $103.5 3.0x - 1/11/21 Sulzer Ltd Nordic Water Products AB Screening, sedimentation and filtration solutions provider $144.7 - - 1/11/21 Aqualis Stormwater Management Weeks Utility Services Wastewater and stormwater services - - - 1/11/21 Industrial Growth Partners Hydromax USA, LLC Infrastructure data collection services - - - 1/4/21 DXP Enterprises, Inc. Pumping Solutions, Inc. Commercial and industrial pump distributor - - - 1/4/21 A.Y. McDonald Mfg. Co. Val-Matic Valve & Manufacturing Corporation Water and wastewater valve manufacturer - - - 1/4/21 DeZURIK, Inc. Red Valve Company, Inc. Highly-engineered valves provider $63.0 - - 12/28/20 Pentair plc Rocean Smart, sustainable water solutions provider - - - 12/23/20 Littlejohn & Co. Dana Kepner Waterworks products distributor - - - 12/23/20 Vortex Companies, LLC North American Pipeline Services LLC CCTV inspection and trenchless rehabilitation services - - - 12/21/20 New Mountain Capital, L.L.C Inframark, LLC Water utility operations and maintenance services - - - 12/21/20 Evoqua Water Technologies Corp. Segment of Ultrapure & Industrial Services, LLC Industrial water services - - - 12/21/20 Ebara Corp Vansan Makina Check-valve and pump manufacturer $108.0 - 7.5x 12/18/20 RSK Group Limited Black & Veatch Limited Sustainable water, wastewater and flood resilience projects - - - 12/17/20 Skion Water Paques BV Wastewater and gas treatment solutions - - - 12/15/20 Shamrock Environmental Corporation Virginia American Industries, LLC Non-hazardous wastewater treatment services - - -

Sources: S&P LCD, CapIQ, MergerMarket, press releases and Raymond James internal resources. (1) New Mountain Capital moved their offer from $26/share to $30/share, thereby effectively changing the multiples represented in the table. RAYMOND JAMES INVESTMENT BANKING 11 WATER QUARTERLY SUMMER 2021

Select Recent Transactions (cont’d)

Date Transaction EV / LTM Announced Buyers/Investors Target Target Description Value ($mm) Revenue EBITDA

12/15/20 Hawaiian Cool Water, LLC AAA Best Water Inc. Residential water filtration and software solutions - - - 12/15/20 Chart Industries, Inc. Sustainable Energy Solutions, Inc. Carbon capture technology provider $45.0 - - 12/15/20 In-Situ Inc. AJAX Environmental & Safety Supply, Inc. Water, air and soil sampling and analysis equipment - - - 12/10/20 EnviroChemie GmbH Industrial Water Management Limited Cooling tower, steam boiler and water hygiene services - - - 12/8/20 TransAlta Corporation 30% of EMG International, LLC Process wastewater treatment systems provider - - - 12/7/20 RDCP Group Ltd Buxton Water Ltd Hydro-demolition and commercial drainage solutions - - - 12/7/20 SPX Flow Plc Uutechnic Group Oyj Production process equipment manufacturer $42.0 2.0x 27.5x 12/3/20 WSP Global Inc. Golder Associates Corporation Earth science and environmental services $1,087.2 - - 12/2/20 Crossplane Capital Griffin Dewatering Corporation Groundwater control solutions - - - 11/30/20 LuminUltra Technologies Ltd. Source Molecular Corporation (nka:SMC Miami Lakes Holdco, Inc.)Lab-based testing solutions for microbial pathogens - - - 11/24/20 John Swire & Sons Limited WesTech Engineering, Inc. Water treatment services and process solutions - - - 11/20/20 Ovivo Inc. ALAR Engineering Corporation Wastewater treatment systems manufacturer - - - 11/19/20 Snam S.p.A. 33% of Industrie De Nora S.p.A. Sustainable clean energy and water treatment technologies $1,435.5 - - 11/16/20 Gryphon Investors Inc Vessco, Inc. Value-added water treatment equipment distributor - - - 11/3/20 Chart Industries, Inc. BlueInGreen, LLC Custom-engineered dissolved gas treatment solutions $26.0 - - 11/3/20 Badger Meter, Inc. scan Messtechnik GmbH Optical water quality sensing solutions $35.9 2.4x - 11/3/20 Ostara Nutrient Recovery Technologies Inc. Certain Assets Of Bruce Oakley Granulation facility and terminal - - - 11/2/20 Franklin Electric Co., Inc. Waterite Technologies, Inc./Waterite America Inc Residential and commercial water treatment products and services - - - 11/2/20 Seven Seas Water Corporation Aguas de Panama Municipal water provider in Panama $48.6 - - 11/1/20 Frontenac Company LLC newterra ltd. Modular treatment system designer and manufacturer - - - 10/27/20 Denali Water Solutions LLC Veris Environmental, LLC / AWS Dredge, LLC Biosolids recyclig, dewatering, and related services - - - 10/22/20 Quench USA, Inc. Dove Water Bottless water coolers provider - - - 10/22/20 Latham Pool Products, Inc. GLI Pool Products Pool covers and liners provider - - - 10/20/20 McKim & Creed, Inc. Matchpoint Water Asset Management, Inc. Water loss, recovery and leak detection services - - - 10/20/20 AH Water Investments BV Ridgewood Egypt for Infrastructure Projects, Ltd. Water desalination plant operator - - - 10/16/20 Avidity Science, LLC Bio Medic Data Systems, Inc./Harford Systems Inc./Lab Products,Water Inc. purification, control and monitoring solutions - - - 10/13/20 The GC Companies AVANTech, Inc. Industrial water treatment solutions provider - - - 10/12/20 Helios Technologies, Inc. Balboa Water Group Inc. Electronic controls and white goods manufacturer for pool and spa $220.0 - 9.3x 10/7/20 Warren Equity Partners, LLC Si Environmental, LLC Operations and maintenance services provider - - - 10/6/20 EPCOR Water Arizona Inc. Johnson Utilities Arizona-based water system operator $110.0 - - 10/6/20 In-Situ Inc. Partech (Electronics) Ltd Water and wastewater measurement equipment manufacturer - - - 9/22/20 Gradiant Corporation Sigma Water Engineering (M) Sdn. Bhd. Industrial water and wastewater treatment solutions - - - 9/22/20 CarteGraph Systems, Inc. SEMS Technologies, LLC Water and wastewater utility software - - - 9/21/20 EnviroChemie Group Letzner Pharmawasseraufbereitung Process water treatment plants - - - 9/15/20 Temasek Capital Management Pte. Ltd. Rivulis Irrigation Ltd. Micro-irrigation products manufacturer - - - 9/10/20 Antin Infrastructure Partners S.A.S. Miya Water Spain SL Urban water efficiency solutions provider - - - 9/8/20 Valicor Environmental Services, LLC Water Depot, Inc. Centralized wastewater treatment services - - - 9/8/20 Evoqua Water Technologies Corp. Assets of Aquapure Technologies, Inc. Industrial water treatment systems provider - - - 9/1/20 Wrench Group, LLC All About Water, LLC Plumbing and water treatment services - - - 8/30/20 Veolia Environnement S.A. Suez SA Water, wastewater and waste management solutions $23,654.9 1.4x 10.1x

Sources: S&P LCD, CapIQ, MergerMarket, press releases and Raymond James internal resources. RAYMOND JAMES INVESTMENT BANKING 12 WATER QUARTERLY SUMMER 2021

Select Recent Transactions (cont’d)

Date Transaction EV / LTM Announced Buyers/Investors Target Target Description Value ($mm) Revenue EBITDA

8/20/20 RSK Group Limited WRc PLC Technical research and innovation services - - - 8/18/20 Société d'Assainissement Rationnel et de Pompage Suez RV OSIS Sanitation network and infrastructure maintenance $355.2 - - 8/17/20 GEF Capital Partners, LLC Enviromix, LLC Wastewater mixing technology solutions - - - 8/11/20 Dantherm Group A/S SET Energietechnik GmbH Swimming pool equipment manufacturer - - - 7/17/20 GHK Capital Partners LP Hasa, Inc. Water treatment chemicals and ancillary products - - - 7/16/20 Suez SA RO Membranes Business of LANXESS Reverse osmosis membranes provider - - - 7/15/20 Rainmaker Worldwide Inc. Sphere 3D Corp. Potable water provider - - - 7/15/20 PSP.US, Inc. Assets of PolyCera, Inc. Organic metal membrane products - - - Median $127.4 2.0x 10.1x Mean $1,084.8 2.2x 11.3x

Sources: S&P LCD, CapIQ, MergerMarket, press releases and Raymond James internal resources. RAYMOND JAMES INVESTMENT BANKING 13 WATER QUARTERLY SUMMER 2021

Public Company Comparable Universe

Set forth below, we have classified select publicly traded companies within the water universe into nine subsectors. We recently recategorized the sector groups given the growing importance on smart tech, services, and engineered solutions providers. In addition, we increased the representation of non- U.S. companies to reflect the addition of the water-related bankers in Europe.

AGRICULTURE ENGINEERED SOLUTIONS FLOW CONTROL

INFRASTRUCTURE RESI & COMM SERVICES SMART TECH

SPECIALTY CHEMICAL SPECIALTY DISTRIBUTION UTILITIES

(1)

(1) To be included in next quarter’s newsletter. RAYMOND JAMES INVESTMENT BANKING 14 WATER QUARTERLY SUMMER 2021

Public Company Valuation: EV / LTM EBITDA

AGRICULTURE ENGINEERED SOLUTIONS FLOW CONTROL

18.8x 18.2x 19.1x 16.9x 16.7x 15.9x 16.4x 15.9x 16.1x 15.3x 16.0x 14.3x 17.3x 14.9x 13.9x 14.2x 16.2x 15.1x

2017 2018 2019 2020 2021 YTD 2017 2018 2019 2020 2021 YTD 2017 2018 2019 2020 2021 YTD INFRASTRUCTURE RESI & COMM SERVICES SMART TECH

20.8x 20.2x 17.6x 18.1x 18.6x 18.1x 15.3x 16.1x 18.2x 12.4x 13.5x 13.1x 16.1x 11.1x 11.0x 9.7x 9.8x 10.8x

2017 2018 2019 2020 2021 YTD 2017 2018 2019 2020 2021 YTD 2017 2018 2019 2020 2021 YTD SPECIALTY CHEMICAL SPECIALTY DISTRIBUTION UTILITIES

19.1x 19.6x 15.9x 16.3x 16.0x 14.3x 14.5x 13.0x 14.4x 16.0x 13.4x 15.3x 10.1x 11.2x 10.2x 8.7x 8.0x 9.7x

2017 2018 2019 2020 2021 YTD 2017 2018 2019 2020 2021 YTD 2017 2018 2019 2020 2021 YTD

Source: Bloomberg market data as of 6/30/2021. Note: Values represent the median EV / LTM EBITDA multiples for each sector over the course of the period. For additional detail on the companies within each sector, see detail pages in the back of the newsletter. Grey dotted line and bold value represent the average of the five yearly multiple medians. RAYMOND JAMES INVESTMENT BANKING 15 WATER QUARTERLY SUMMER 2021

Industry Performance Overview (cont’d)

Stock Price Performance

30 Day 2020 2021 YTD 39% 32% 33%

23% 18% 20% 16% 15% 16% 14% 12% 12%

3% 1% 1% 2% 0%

0% 0% 0% 0% -3% -4% -3% -3% -4% -2% Agriculture Engineered Solutions Flow Control Infrastructure Residential & Commercial Smart Tech Specialty Chemical Specialty Distribution Utilities Services Revenue CAGR (’21-’23)

7.0% 7.2%

5.7% 5.6% 5.4% 5.4% 5.2% 4.9% 5.1%

Agriculture Engineered Solutions Flow Control Infrastructure Residential & Commercial Services Smart Tech Specialty Chemical Specialty Distribution Utilities Gross Margin (LTM)

53.7%

41.3% 40.4% 35.6% 35.1% 33.2% 32.1% 31.2%

16.5%

Agriculture Engineered Solutions Flow Control Infrastructure Residential & Commercial Services Smart Tech Specialty Chemical Specialty Distribution Utilities

Source: CapIQ market data as of 6/30/2021. Note: Values represent the median price, revenue CAGR, and gross margin for each sector over the course of the period. For additional detail on the companies within each sector, see detail pages in the back of the newsletter. RAYMOND JAMES INVESTMENT BANKING 16 WATER QUARTERLY SUMMER 2021

Water Investment Banking Team

An active presence at industry conferences as well as an open dialogue with key industry decision makers provides the Raymond James team with market-leading insight and intel. We leverage this deep sector focus to provide discerning, objective advice for our clients.

Brendan E. Tierney Alastair Rogers Florian Stoeger Managing Director Managing Director Director Global Head of Water, New York City European Sustainability, London European Water, Frankfurt O: +1.212.856.4387 O: +44.203.798.5744 O: +49.69.21.93.3722 E: [email protected] E: [email protected] E: [email protected]

Clancey W. Crowley Adam Gravitt Ben Calkins Matthew Moldawer Vice President Associate Analyst Analyst Americas Water, New York City Americas Water, New York City Americas Water, New York City Americas Water, New York City O: +1.212.885.1821 O: +1.212.883.6595 O: +1.212. O: +1.212. E: [email protected] E: [email protected] E: [email protected] E: [email protected]

RAYMOND JAMES INVESTMENT BANKING 17 WATER QUARTERLY SUMMER 2021

Representative Credentials

Raymond James has participated in many industry-shaping transactions, including mergers and acquisitions, strategic advisory, fairness opinions and equity and debt capital raises, within the water and wastewater space.

July 2021 June 2021 June 2021 March 2021 March 2021 March 2021

AA portfolio portfolio companycompany of Follow-on Offering Has been acquired by Has acquired Private Placement Initial public offering HasHas been acquired by by

C$175,000,000 $245,000,000 $350,000,000

November 2020 June 2020 May 2020 May 2020 March 2020 January 2020

Simultaneous carve-out Has acquired divestitures of Block Trade Equity & Preferred Follow-On Offering has been acquired by Offering A portfolio company of By way of an MBO backed by $11,200,000 $3,500,000,000 $253,500,000

November 2019 October 2019 September 2019 July 2019 April 2019 March 2019

a portfolio company of a portfolio company of a portfolio company of Carve-out Sale of has received a majority has been acquired by investment from by way of an MBO backed by has been acquired by has been acquired by has been acquired by C$312,000,000

December 2018 June 2018 June 2018 March 2018 November 2017 October 2017

a portfolio company of has been acquired by Initial Public Offering has acquired Follow On Offering has been acquired by has been acquired by

$58,000,000 $132,000,000 $442,750,000 $575,000,000

October 2017 August 2017 June 2017 April 2017 October 2016 January 2016 Heart of Texas Environmental Suppliers Disposal Corporation has sold its assets to has been acquired by has been acquired by Private Placement Initial Public Offering has been acquired by

$59,000,000 $26,000,000 $134,550,000

Note: Representative credentials include transactions completed by a Raymond James banker while at a former firm. RAYMOND JAMES INVESTMENT BANKING 18 WATER QUARTERLY SUMMER 2021

Water Conference Calendar: Next 12 Months

Planning to attend the following conferences? Contact the team to schedule a meeting!

International trade association 28 – 30 July 2021 Las Vegas, NV representing the residential, commercial and industrial water treatment industry

The largest event of its kind in North 16 – 20 October 2021 Chicago, IL America, offering water quality education and training

Important annual meeting point for senior 17 – 18 November 2021 Los Angeles, CA executives working within the North American water sector

The premier event for municipalities, plumbers, portable sanitation 21 – 24 February 2022 Indianapolis, IN professionals, septic contractors, sewer contractors and wastewater professionals

The largest trenchless technology 10 – 14 April 2022 Minneapolis, MN conference in the world

The flagship water sector event, renowned for its industry-leading agenda and the 16 – 18 May 2022 Madrid, Spain high concentration of water sector executives that attend each year

RAYMOND JAMES INVESTMENT BANKING 19 WATER QUARTERLY SUMMER 2021

Appendix

RAYMOND JAMES INVESTMENT BANKING 20 WATER QUARTERLY SUMMER 2021

Comparable Companies Detail

As of 06/30/2021. (In millions of USD, except per share data) LTM Financial Performance Growth Leverage Valuation Metrics Listing Listing Stock SP SP SP SP SP % of 52 Week Dividend Enterprise Market Gross EBITDA Revenue CAGR LTM EV / Revenue EV / EBITDA Company Exchange Country Price 1/1/21 Today % change YTD 1/1/20 12/31/20 % change 2020 30 days ago Today %change 30 High Low Yield Value Cap Revenue EBITDA Margin Margin '19 - '21 '21 - '23 Gross Net LTM NTM LTM NTM Agriculture Lindsay Corporation NYSE United States $165.28 $128.46 $165.28 29% $95.99 $128.46 34% $164.63 $165.28 0% 92% 185% 0.8% $1,812 $1,803 $542 $82 29.9% 15.1% - 8.2% 1.7x - 3.3x 3.2x 22.1x 22.7x Raven Industries, Inc. NASDAQGS United States $57.85 $33.09 $57.85 75% $34.46 $33.09 -4% $44.13 $57.85 31% 99% 289% - 2,079 2,087 374 44 34.4% 11.8% 10.2% 11.7% 0.2x - 5.6x 4.7x - - The Toro Company NYSE United States $109.88 $94.84 $109.88 16% $79.67 $94.84 19% $111.09 $109.88 -1% 93% 172% 0.9% 12,035 11,764 3,704 614 35.5% 16.6% 17.1% 5.9% 1.3x 0.4x 3.2x 3.0x 19.6x 19.1x Valmont Industries, Inc. NYSE United States $236.05 $174.93 $236.05 35% $149.78 $174.93 17% $248.00 $236.05 -5% 89% 214% 0.9% 5,503 5,016 3,202 392 26.1% 12.3% 16.7% 3.5% 2.3x 1.8x 1.7x 1.7x 14.0x 13.3x Mean $107.83 $142.27 39% $89.98 $107.83 16% $141.96 $142.27 6.4% 0.9% 31.5% 13.9% 14.7% 7.3% 1.4x 1.1x 3.5x 3.2x 18.6x 18.4x Median 111.65 137.58 32% 87.83 111.65 18% 137.86 137.58 (0.3%) 0.9% 32.1% 13.7% 16.7% 7.0% 1.5x 1.1x 3.3x 3.1x 19.6x 19.1x

Engineered Solutions A. O. Smith Corporation NYSE United States $72.06 $54.82 $72.06 31% $47.64 $54.82 15% $71.07 $72.06 1% 99% 156% 1.5% $11,051 $11,562 $3,027 $577 38.2% 19.1% 10.4% 4.5% 0.3x - 3.7x 3.2x 19.1x 16.8x Advanced Drainage Systems, Inc. NYSE United States $116.57 83.58 116.57 39% 38.84 83.58 115% 113.42 116.57 3% 99% 257% 0.4% 9,340 8,408 1,983 474 34.8% 23.9% - - 1.8x 1.4x 4.7x 4.1x 19.7x 14.4x Alfa Laval AB (publ) OM Sweden 302.30 kr 27.51 35.34 28% 25.18 27.55 9% 37.71 35.34 -6% 95% 172% 1.6% 15,473 14,785 4,602 888 35.2% 19.3% (3.1%) 7.5% 1.5x 1.1x 3.4x 3.3x 17.4x 16.0x Danaher Corporation NYSE United States $268.36 222.14 268.36 21% 153.48 222.14 45% 256.14 268.36 5% 98% 153% 0.3% 209,620 191,416 24,799 8,020 59.6% 32.3% - 4.9% 2.7x 1.9x - 7.4x - 23.0x DuPont de Nemours, Inc. NYSE United States $77.41 71.11 77.41 9% 64.20 71.11 11% 84.59 77.41 -8% 89% 153% 1.6% 48,365 41,193 20,703 4,938 33.8% 23.9% - 4.9% 2.6x 1.3x 2.3x 3.0x 9.8x 11.8x Evoqua Water Technologies Corp. NYSE United States $33.78 26.98 33.78 25% 18.95 26.98 42% 31.12 33.78 9% 99% 199% - 4,769 4,050 1,400 241 31.8% 17.2% 2.0% 5.5% 3.9x 3.0x 3.4x 3.2x 19.8x 18.1x Halma plc LSE United Kingdom £26.92 33.49 37.18 11% 28.07 33.44 19% 37.00 37.18 0% 93% 127% 0.6% 14,437 14,082 1,816 429 49.8% 23.6% 14.1% 9.3% 1.3x 0.8x - 7.1x - - IDEX Corporation NYSE United States $220.05 199.20 220.05 10% 172.00 199.20 16% 222.66 220.05 -1% 93% 142% 1.0% 16,904 16,709 2,534 691 44.3% 27.3% 6.3% 7.5% 1.7x 0.7x - 6.2x 24.5x 22.4x METAWATER Co., Ltd. TSE Japan ¥2,109.00 22.50 19.00 -16% 20.10 22.50 12% 18.41 19.00 3% 82% 113% 2.0% 765 827 1,206 111 22.2% 9.2% 8.3% 3.1% 0.9x - 0.6x 0.6x 6.9x 8.5x Pentair plc NYSE United States $67.49 53.09 67.49 27% 45.87 53.09 16% 68.97 67.49 -2% 95% 188% 1.1% 12,138 11,217 3,402 659 36.0% 19.4% - 3.1% 1.1x 0.9x 3.6x 3.4x 18.4x 17.2x Mean $79.44 $94.72 19% $61.43 $79.44 30% $94.11 $94.72 0.3% 1.1% 38.6% 21.5% 6.3% 5.6% 1.8x 1.4x 3.1x 4.2x 16.9x 16.5x Median 53.96 69.78 23% 42.36 53.96 16% 70.02 69.78 0.9% 1.1% 35.6% 21.5% 7.3% 4.9% 1.6x 1.2x 3.4x 3.3x 18.8x 16.8x

Flow Control Flowserve Corporation NYSE United States $40.32 41.45 40.32 -3% 49.77 36.85 -26% 42.39 40.32 -5% 91% 156% 1.9% $6,145 $5,254 $3,692 $502 31.6% 13.6% (4.0%) 5.5% 3.0x 1.7x 1.7x 1.7x 12.3x 13.5x Franklin Electric Co., Inc. NASDAQGS United States $80.62 80.34 80.62 0% 57.32 69.21 21% 83.89 80.62 -4% 92% 166% 0.9% 3,758 3,747 1,443 205 34.9% 14.2% 7.0% 6.9% 1.3x 0.9x 2.6x 2.5x 18.3x 16.5x Graco Inc. NYSE United States $75.70 75.54 75.70 0% 52.00 72.35 39% 75.72 75.70 0% 95% 160% 1.0% 12,587 12,826 1,871 574 52.6% 30.7% 8.0% 5.7% 0.4x - - 6.6x 21.9x 21.2x Mueller Water Products, Inc. NYSE United States $14.42 14.52 14.42 -1% 11.98 12.38 3% 14.47 14.42 0% 96% 164% 1.5% 2,533 2,286 999 198 35.1% 19.8% 4.1% - 2.4x 1.2x 2.5x 2.4x 12.8x 11.6x Rotork plc LSE United Kingdom £3.40 3.60 4.70 30% 4.44 4.34 -2% 4.80 4.70 -2% 89% 127% 3.5% 3,859 4,105 825 211 47.0% 25.5% (3.6%) 4.7% 0.1x - 4.7x 4.6x 18.3x 17.2x SPX FLOW, Inc. NYSE United States $65.24 82.04 65.24 -20% 48.87 57.96 19% 68.63 65.24 -5% 91% 194% 0.4% 2,783 2,754 1,425 161 34.8% 11.3% 0.5% 5.0% 2.5x 0.2x 2.0x 1.8x 17.3x 13.0x Sulzer Ltd SWX Switzerland 127.80 CHF 132.30 138.23 4% 111.54 105.23 -6% 127.48 138.23 8% 98% 206% 3.0% 5,158 4,677 3,751 380 29.9% 10.1% 1.1% 5.4% 5.5x 1.3x 1.4x 1.3x 13.6x 10.0x The Gorman-Rupp Company NYSE United States $34.44 35.15 34.44 -2% 37.50 32.45 -13% 35.98 34.44 -4% 92% 120% 1.8% 783 899 354 47 26.0% 13.3% (4.2%) - 0.0x - 2.2x 2.1x 16.6x 13.1x The Weir Group PLC LSE United Kingdom £18.51 19.03 25.56 34% 20.02 27.16 36% 27.28 25.56 -6% 87% 184% - 8,030 6,623 2,682 486 35.3% 18.1% (12.0%) 6.0% 3.8x 2.8x 3.0x 2.9x 16.5x 14.5x Watts Water Technologies, Inc. NYSE United States $145.91 144.88 145.91 1% 99.76 121.70 22% 135.90 145.91 7% 100% 189% 0.7% 4,886 4,913 1,539 253 41.3% 16.5% 1.0% 3.3% 0.8x - 3.2x 3.0x 19.3x 17.7x Xylem Inc. NYSE United States $119.96 122.52 119.96 -2% 78.79 101.79 29% 118.12 119.96 2% 99% 189% 0.9% 23,043 21,598 5,009 816 38.3% 16.3% 0.8% 5.3% 3.8x 1.8x 4.6x 4.3x - 24.2x Mean $58.12 $56.71 1% $46.68 $48.85 4% $56.67 $56.71 (1.5%) 1.8% 36.5% 17.2% (0.1%) 5.3% 2.1x 1.4x 2.8x 3.0x 16.7x 15.7x Median 58.50 52.78 0% 49.32 47.41 1% 55.51 52.78 (2.9%) 1.6% 35.1% 16.3% 0.8% 5.4% 2.4x 1.3x 2.6x 2.5x 17.0x 14.5x

Infrastructure AECOM NYSE United States $63.32 $49.78 $63.32 27% $43.13 $49.78 15% $65.01 $63.32 -3% 90% 182% - $11,443 $9,270 $13,337 $768 5.7% 5.8% (15.0%) - 3.9x 2.7x 0.9x 0.8x - 13.5x Fluor Corporation NYSE United States $17.70 15.97 17.70 11% 18.88 15.97 -15% 18.50 17.70 -4% 71% 219% - 2,489 2,502 14,909 243 2.8% 1.6% (10.9%) 6.2% 6.9x - 0.2x 0.2x 10.2x 7.9x Forterra, Inc. NASDAQGS United States $23.51 17.20 23.51 37% 11.56 17.20 49% 23.38 23.51 1% 98% 225% - 2,684 1,568 1,632 271 24.5% 16.6% 5.0% 3.6% 4.3x 4.1x 1.6x 1.6x 9.9x 8.6x H2O Innovation Inc. TSXV Canada C$2.26 1.60 1.82 14% 0.76 1.60 110% 1.99 1.82 -8% 61% 228% - 162 153 115 11 27.9% 9.9% 11.9% 7.3% 1.8x 0.8x 1.4x 1.3x - 11.9x Northwest Pipe Company NASDAQGS United States $28.25 28.30 28.25 0% 33.31 28.30 -15% 31.66 28.25 -11% 74% 125% - 292 278 289 39 16.5% 13.5% 5.2% - 1.1x 0.3x 1.0x 0.9x 7.5x 6.8x Orion Group Holdings, Inc. NYSE United States $5.75 4.96 5.75 16% 5.19 4.96 -4% 5.98 5.75 -4% 86% 234% - 247 175 697 42 11.5% 6.0% 1.0% 5.4% 1.8x 1.7x 0.4x 0.4x - - Primoris Services Corporation NASDAQGS United States $29.43 27.61 29.43 7% 22.24 27.61 24% 31.79 29.43 -7% 70% 196% 0.8% 2,238 1,581 3,567 277 11.3% 7.8% 9.7% 6.0% 3.1x 2.4x 0.6x 0.6x 8.1x 7.3x Stantec Inc. TSX Canada C$55.31 32.43 44.64 38% 28.25 32.40 15% 44.58 44.64 0% 93% 148% 1.1% 5,831 4,986 2,868 346 52.4% 12.1% 3.2% 2.5% 3.1x 2.4x 2.0x 1.9x - 12.2x Suez SA ENXTPA France €20.05 19.81 23.77 20% 15.07 19.84 32% 24.40 23.77 -3% 100% 201% 3.3% 29,980 15,194 21,051 2,493 52.7% 11.8% 0.3% 2.6% 7.5x 4.8x 1.4x 1.5x 12.0x 8.2x Tetra Tech, Inc. NASDAQGS United States $122.04 115.78 122.04 5% 86.16 115.78 34% 119.47 122.04 2% 84% 163% 0.6% 6,912 6,610 2,355 284 19.9% 12.1% 1.0% 5.5% 1.9x 1.1x 2.9x 2.7x - - Veolia Environnement S.A. ENXTPA France €25.47 24.44 30.20 24% 26.49 24.48 -8% 31.42 30.20 -4% 95% 162% 2.6% 33,975 17,129 30,683 3,130 15.3% 10.2% 3.5% 3.4% 7.5x 4.9x 1.1x 1.1x 10.9x 7.1x Mean $30.72 $35.49 18% $26.46 $30.72 22% $36.20 $35.49 -4% 1.7% 21.9% 9.8% 1.4% 4.7% 3.9x 2.5x 1.2x 1.2x 9.8x 9.3x Median 24.44 28.25 16% 22.24 24.48 15% 31.42 28.25 -4% 1.1% 16.5% 10.2% 3.2% 5.4% 3.1x 2.4x 1.1x 1.1x 10.1x 8.2x

Source: CapIQ. Values that exceed or fail to reach an appropriate threshold for each category are excluded. RAYMOND JAMES INVESTMENT BANKING 21 WATER QUARTERLY SUMMER 2021

Comparable Companies Detail

As of 06/30/2021. (In millions of USD, except per share data) LTM Financial Performance Growth Leverage Valuation Metrics Listing Listing Stock SP SP SP SP SP % of 52 Week Dividend Enterprise Market Gross EBITDA Revenue CAGR LTM EV / Revenue EV / EBITDA Company Exchange Country Price 1/1/21 Today % change YTD 1/1/20 12/31/20 % change 2018 30 days ago Today %change 30 High Low Yield Value Cap Revenue EBITDA Margin Margin '19 - '21 '21 - '23 Gross Net LTM NTM LTM NTM Residential & Commercial Services Aramark NYSE United States $37.25 $38.48 $37.25 -3% $43.40 $38.48 -11% $37.35 $37.25 0% 86% 183% 1.2% $16,769 $9,497 $10,408 $7 9.1% - (18.8%) 12.9% - - 1.6x 1.2x - 14.3x Compass Group PLC LSE United Kingdom £15.22 $18.64 $21.02 13% $25.07 $18.61 -26% $22.85 $21.02 -8% 92% 149% - 41,342 37,498 21,903 475 24.6% 2.2% - 17.7% - - 1.9x 1.4x - 16.3x Ecolab Inc. NYSE United States $205.97 $216.36 $205.97 -5% $192.99 $216.36 12% $215.08 $205.97 -4% 90% 114% 0.9% 64,857 58,895 11,655 2,444 41.3% 21.0% (16.1%) 5.7% 2.7x 2.3x 5.6x 5.1x - 21.8x Primo Water Corporation TSX Canada C$20.74 $15.68 $16.74 7% $13.66 $15.66 15% $17.14 $16.74 -2% 91% 126% 1.4% 4,248 2,697 1,958 318 56.4% 16.2% (14.0%) 4.5% 5.1x 4.8x 2.2x 2.0x 13.4x 10.9x Terminix Global Holdings, Inc. NYSE United States $47.71 $51.01 $47.71 -6% $38.66 $51.01 32% $49.34 $47.71 -3% 87% 135% - 6,684 6,133 1,976 346 42.0% 17.5% (1.7%) 4.2% 3.0x 1.6x 3.4x 3.2x 19.3x 17.1x Mean $68.03 $65.74 1% $62.76 $68.02 4% $68.35 $65.74 (3.6%) 1.2% 34.7% 14.2% (12.6%) 9.0% 3.6x 2.9x 2.9x 2.6x 16.3x 16.1x Median 38.48 37.25 -3% 38.66 38.48 12% 37.35 37.25 (3.3%) 1.2% 41.3% 16.9% (15.0%) 5.7% 3.0x 2.3x 2.2x 2.0x 16.3x 16.3x

Smart Tech ABB Ltd SWX Switzerland 31.39 CHF $27.91 $33.95 22% $24.14 $27.93 16% $34.12 $33.95 0% 98% 147% 2.4% $71,138 $68,108 $28,114 $3,621 31.7% 12.9% 1.1% 4.2% 2.1x 1.0x 2.5x 2.4x 19.6x 15.2x Badger Meter, Inc. NYSE United States $98.12 $94.06 $98.12 4% $64.93 $94.06 45% $95.57 $98.12 3% 88% 165% 0.7% 2,819 2,863 467 99 40.4% 21.3% 6.2% 5.3% 0.0x - - 5.8x - - Danaher Corporation NYSE United States $268.36 $222.14 $268.36 21% $153.48 $222.14 45% $256.14 $268.36 5% 98% 153% 0.3% 209,620 191,416 24,799 8,020 59.6% 32.3% - 4.9% 2.7x 1.9x - 7.4x - 23.0x Emerson Electric Co. NYSE United States $96.24 $80.37 $96.24 20% $76.26 $80.37 5% $95.69 $96.24 1% 97% 163% 2.1% 63,241 57,715 17,064 3,764 41.6% 22.1% (0.2%) 5.2% 2.1x 1.5x 3.7x 3.4x 16.8x 15.0x Energy Recovery, Inc. NASDAQGS United States $22.78 $13.64 $22.78 67% $9.79 $13.64 39% $19.01 $22.78 20% 100% 341% - 1,208 1,310 126 47 76.2% 36.8% 9.3% - 0.4x - - 11.8x - - Itron, Inc. NASDAQGS United States $99.98 $95.90 $99.98 4% $83.95 $95.90 14% $95.35 $99.98 5% 82% 187% - 4,925 4,512 2,095 181 28.5% 8.6% (4.3%) 6.5% 5.3x 2.1x 2.4x 2.1x - 20.8x Schneider Electric S.E. ENXTPA France €132.68 $144.52 $157.32 9% $102.22 $144.71 42% $158.21 $157.32 -1% 94% 139% 1.9% 96,364 87,204 30,776 5,204 40.4% 16.9% 4.4% 4.6% 2.7x 1.1x 3.1x 2.9x 18.5x 15.0x Trimble Inc. NASDAQGS United States $81.83 $66.77 $81.83 23% $41.69 $66.77 60% $77.79 $81.83 5% 96% 198% - 21,763 20,536 3,242 701 58.6% 21.6% 3.9% 7.9% 2.1x 1.8x - 6.1x - - Xylem Inc. NYSE United States $119.96 $101.79 $119.96 18% $78.79 $101.79 29% $118.12 $119.96 2% 99% 189% 0.9% 23,043 21,598 5,009 816 38.3% 16.3% 0.8% 5.3% 3.8x 1.8x 4.6x 4.3x - 24.2x Mean $94.12 $108.73 21% $70.58 $94.15 33% $105.56 $108.73 4% 1.4% 46.1% 21.0% 2.7% 5.5% 2.4x 1.6x 3.3x 5.1x 18.3x 18.9x Median 94.06 98.12 20% 76.26 94.06 39% 95.57 98.12 3% 1.4% 40.4% 21.3% 2.5% 5.2% 2.1x 1.8x 3.1x 4.3x 18.5x 18.0x

Specialty Chemical Clariant AG SWX Switzerland 18.40 CHF 21.26 19.90 -6% 22.31 21.27 -5% 21.64 19.90 -8% 89% 122% 0.8% $7,810 $6,559 $4,363 $671 31.2% 15.4% (2.3%) 5.6% 3.4x 1.7x 1.8x 1.8x 11.6x 10.5x Ecolab Inc. NYSE United States $205.97 216.36 205.97 -5% 192.99 216.36 12% 215.08 205.97 -4% 90% 114% 0.9% 64,857 58,895 11,655 2,444 41.3% 21.0% (8.4%) 5.7% 2.7x 2.3x 5.6x 5.1x - 21.8x Hawkins, Inc. NASDAQGS United States $32.75 26.16 32.75 25% 22.91 26.16 14% 34.02 32.75 -4% 82% 156% 1.6% 805 697 597 79 20.7% 13.2% - - 1.4x 1.4x 1.3x 1.2x 10.2x 9.5x Kemira Oyj HLSE United Kingdom £13.28 15.81 15.75 0% 14.81 15.83 7% 16.27 15.75 -3% 91% 127% 4.1% 3,350 2,411 2,926 428 15.9% 14.6% (0.8%) 3.0% 2.7x 2.3x 1.1x 1.1x 7.8x 6.7x Kurita Water Industries Ltd. TSE Japan ¥5,330.00 38.23 48.03 26% 29.94 38.22 28% 45.94 48.03 5% 99% 188% 1.3% 5,315 5,396 2,421 475 35.4% 19.6% - 5.5% 1.0x - 2.2x 2.1x 11.2x 11.0x Mean $63.56 $64.48 8% $56.59 $63.57 11% $66.59 $64.48 -3% 1.7% 28.9% 16.8% (3.9%) 5.0% 2.2x 1.9x 2.4x 2.3x 10.2x 11.9x Median 26.16 32.75 0% 22.91 26.16 12% 34.02 32.75 -4% 1.3% 31.2% 15.4% (2.3%) 5.6% 2.7x 2.0x 1.8x 1.8x 10.7x 10.5x

Specialty Distribution Ferguson plc LSE United Kingdom £100.50 $121.48 $138.80 14% $90.87 $121.29 33% $136.16 $138.80 2% 98% 157% 1.0% $33,099 $30,809 $22,235 $1,910 29.4% 8.6% 5.3% 5.0% 2.1x 1.2x 1.5x 1.4x 17.3x 13.0x MSC Industrial Direct Co., Inc. NYSE United States $89.73 84.39 89.73 6% 78.47 84.39 8% 94.40 89.73 -5% 93% 149% 3.5% 5,749 5,020 3,160 427 42.0% 13.5% (2.8%) 5.7% 1.9x 1.8x 1.8x 1.7x 13.5x 12.6x Pool Corporation NASDAQGS United States $458.66 372.50 458.66 23% 212.38 372.50 75% 436.55 458.66 5% 98% 171% 0.7% 19,024 18,407 4,827 719 29.4% 14.9% - 7.4% 0.9x 0.8x 3.9x 3.8x - - SiteOne Landscape Supply, Inc. NYSE United States $169.26 158.63 169.26 7% 90.65 158.63 75% 172.04 169.26 -2% 82% 163% - 8,138 7,520 2,895 282 33.2% 9.7% - 7.3% 2.3x 2.2x 2.8x 2.5x - - W.W. Grainger, Inc. NYSE United States $438.00 408.34 438.00 7% 338.52 408.34 21% 462.16 438.00 -5% 91% 144% 1.4% 24,906 22,824 11,880 1,539 35.4% 13.0% 11.8% 7.2% 1.5x 1.2x 2.1x 1.9x 16.2x 14.0x Mean $192.79 $229.06 15% $127.24 $192.73 39% $222.37 $229.06 1% 1.7% 33.9% 11.9% 4.8% 6.5% 1.7x 1.4x 2.4x 2.3x 15.7x 13.2x Median 121.48 138.80 14% 90.87 121.29 33% 136.16 138.80 2% 1.0% 33.2% 13.0% 5.3% 7.2% 1.9x 1.2x 2.1x 1.9x 16.2x 13.0x

Utilities American States Water Company NYSE United States $79.56 $79.51 $79.56 0% $86.64 $79.51 -8% $79.37 $79.56 0% 95% 115% 1.5% $3,511 $2,937 $496 $176 53.7% 35.6% 4.7% 2.9% 3.3x 3.3x - 6.9x 19.9x 20.1x American Water Works Company, Inc.NYSE United States $154.13 153.47 154.13 0% 122.85 153.47 25% 155.02 154.13 -1% 89% 120% 1.4% 38,734 27,970 3,821 1,910 56.6% 50.0% 5.1% 5.1% 5.7x 5.6x - 9.5x 20.3x 18.2x Artesian Resources Corporation NASDAQ United States $36.77 37.08 36.77 -1% 37.21 37.08 0% 41.24 36.77 -11% 86% 111% 2.7% 514 347 89 39 50.4% 44.2% - - 4.2x 4.2x 5.8x 5.7x 13.1x - California Water Service Group NYSE United States $55.54 54.03 55.54 3% 51.56 54.03 5% 56.84 55.54 -2% 90% 135% 1.5% 3,960 2,823 816 265 51.9% 32.4% 5.3% 6.9% 4.6x 4.3x 4.9x 5.0x 15.0x 14.3x Consolidated Water Co. Ltd. NASDAQGS United States $11.73 12.05 11.73 -3% 16.30 12.05 -26% 12.31 11.73 -5% 75% 117% 2.7% 146 178 69 13 35.4% 19.1% 3.1% - 0.2x - 2.1x 2.0x 11.1x 9.7x Essential Utilities, Inc. NYSE United States $45.70 47.29 45.70 -3% 46.94 47.29 1% 47.80 45.70 -4% 93% 119% 2.2% 16,969 11,230 1,791 894 54.4% 49.9% - 7.5% 6.4x 6.4x - 8.8x 19.0x 17.6x Global Water Resources, Inc. NASDAQ United States $17.08 14.41 17.08 19% 13.15 14.41 10% 17.08 17.08 0% 94% 172% 1.6% 482 386 40 16 81.3% 39.7% 7.7% 5.5% 7.3x 6.1x - 11.5x - 24.3x Middlesex Water Company NASDAQ United States $81.73 72.47 81.73 13% 63.57 72.47 14% 85.96 81.73 -5% 92% 137% 1.1% 1,725 1,429 142 59 49.5% 41.6% 2.3% - 5.0x 5.0x - 11.7x - - Pennon Group Plc LSE United Kingdom £17.03 19.49 23.52 21% 20.40 19.46 -5% 22.53 23.52 4% 97% 133% 2.6% 6,903 6,613 858 382 49.6% 44.5% - 6.1% - 0.8x - 6.9x 18.1x 13.6x Severn Trent Plc LSE United Kingdom £25.01 31.30 34.54 10% 33.36 31.25 -6% 34.85 34.54 -1% 97% 116% 3.7% 17,819 8,630 2,517 1,115 27.9% 44.3% 4.6% 2.5% - - - 6.8x 16.0x 13.8x SJW Group NYSE United States $63.30 69.36 63.30 -9% 71.06 69.36 -2% 64.45 63.30 -2% 88% 109% 2.0% 3,375 1,886 564 208 56.0% 36.9% 17.4% 4.5% 7.2x 7.2x 6.0x 5.8x 16.2x 15.0x The York Water Company NASDAQ United States $45.30 46.60 45.30 -3% 46.11 46.60 1% 50.33 45.30 -10% 86% 112% 1.6% 716 592 54 31 79.8% 57.7% 3.3% - 4.0x 4.0x - 12.6x 23.0x - United Utilities Group PLC LSE United Kingdom £9.74 12.24 13.46 10% 12.51 12.22 -2% 13.97 13.46 -4% 93% 119% 4.1% 19,822 9,177 2,491 1,437 90.9% 57.7% 1.4% 0.9% - 7.4x - 8.0x 13.8x 14.1x Mean $49.95 $50.95 4% $47.82 $49.94 0% $52.44 $50.95 -3% 2.2% 56.7% 42.6% 5.5% 4.7% 4.8x 4.9x 4.7x 7.8x 16.9x 16.1x Median 46.60 45.30 0% 46.11 46.60 0% 47.80 45.30 -2% 2.0% 53.7% 44.2% 4.6% 5.1% 4.8x 5.0x 5.3x 6.9x 16.2x 14.7x

Source: CapIQ. Values that exceed or fail to reach an appropriate threshold for each category are excluded. RAYMOND JAMES INVESTMENT BANKING 22 WATER QUARTERLY SUMMER 2021

Notes & Disclosures

Sources of data include Capital IQ, FactSet and other news organizations. This presentation includes logos or other words or devices that may be Information obtained from third-party sources is considered reliable, but registered trademarks of their respective owners. Such use is solely for we do not guarantee that the information herein is accurate or complete. purposes of convenience in referring to the trademark owners and their This report was prepared within Raymond James & Associates’ Investment products/services. This presentation and its contents are not endorsed, Banking Department and is for information purposes only. This report is sponsored or affiliated with any trademark owner. Raymond James & not a product of Raymond James & Associates’ Research Department; Associates, Inc. and its affiliates are not affiliated with any trademark recipients of this report should not interpret the information herein as owner but may provide certain financial services to one or more sufficient grounds for an investment decision or any other decision. The trademark owners or their affiliates. report shall not constitute an offer to sell or the solicitation of an offer to buy any of the securities mentioned herein; past performance does not Additional information is available upon request. guarantee future results. Any performance mentioned does not include transaction fees and costs which would reduce an investor’s return. An investment cannot be made directly in a market index.

INVESTMENT BANKING

© 2021 Raymond James & Associates, Inc., member New York Stock Exchange/SIPC. Raymond James® is a registered trademark of Raymond James Financial, Inc. Raymond James Financial International Limited is authorized and regulated by the Financial Conduct Authority (FRN 188244). Raymond James Corporate Finance GmbH | Commercial Register HRB 136137.