Domestic opportunities offer exciting prospects

Fidelity China Special Situations 11 November 2019 Review
Download PDF

Fidelity China Special Situations

Domestic opportunities offer exciting prospects

Investment trusts

11 November 2019

Price

223.0p

Market cap

£1,224m

AUM

£1,645m

NAV*

245.3p

Discount to NAV

9.1%

*Including income. As at 8 November 2019.

Yield

1.7%

Ordinary shares in issue

549.0m

Code

FCSS

Primary exchange

LSE

AIC sector

Country Specialist:
Asia Pacific – ex Japan

Benchmark

MSCI China

Share price/discount performance

Three-year performance vs index

52-week high/low

250.0p

183.4p

268.8p

206.7p

*Including income.

Gearing

Gross market gearing*

25.7%

Net market gearing*

22.2%

*As at 30 September 2019.

Analysts

Helena Coles

+44 (0)20 3681 2522

Mel Jenner

+44 (0)20 3077 5720

Fidelity China Special Situations is a research client of Edison Investment Research Limited

Fidelity China Special Situations (FCSS) offers investors direct exposure to China for a portion of their portfolio, aiming to deliver long-term capital growth from investing in companies listed in China, and Chinese companies listed elsewhere. Since the trust’s inception in April 2010, FCSS’s NAV total return has increased by nearly 11% pa. The portfolio has a bias towards mid- and small-cap companies, which tend to be less well researched and potentially mispriced. The manager, Dale Nicholls, is focused on opportunities related to rising domestic consumption, which in his view is unlikely to be disrupted by the ongoing US-China trade dispute.

Chinese equities trade at a steep discount to global equities

Source: Refinitiv, Edison Investment research

The market opportunity

China’s economic growth drivers continue to shift away from fixed asset investment and lower-value exports, in favour of domestic consumption. The manager believes there are many exciting long-term investment opportunities arising from structural trends, including urbanisation, rising incomes and technological innovation. As shown in the graph above, Chinese equities’ discount to global equities has been in a narrowing trend over the past four years; however, the current discount of c 22% offers potential for further improvement in relative valuation.

Why consider investing in FCSS?

Obtain direct exposure to China’s continuing growth.

Fundamental approach to investing in China, supported by Fidelity’s extensive research capabilities, involving company visits and in-depth analysis.

Unconstrained approach allows the manager to invest in his highest-conviction ideas, including up to 10% in unlisted stocks ahead of their listing.

Proactive board, committed to shareholders’ interests; it recently reduced its management fees and introduced a new discount control policy.

Single-digit discount policy adopted

FCSS currently trades at an 9.1% discount to its cum-income NAV. This is towards the higher end of the trust’s most recent range of 6–10% since February 2019, which may reflect the current subdued sentiment towards Chinese equities. The board introduced a single-digit discount policy in June 2019 and actively promotes the trust. There is scope for a narrower discount should investor appetite improve.

Exhibit 1: Trust at a glance

Investment objective and fund background

Recent developments

Fidelity China Special Situations aims to achieve long-term capital growth from an actively managed portfolio made up primarily of securities issued by companies listed in China, and Chinese companies listed elsewhere. It may also invest in listed companies with significant interests in China. Futures, options and CFDs are used to provide gearing, as well as to take short positions.

05 June 2019: Adoption of formal single-digit discount control policy.

05 June 2019: Annual results to 31 March 2019 – NAV TR -5.3% versus benchmark TR +0.9%, share price TR -0.3%.

05 June 2019: FY19 dividend increased by 10% to 3.85p per share.

1 June 2019: Linda Yueh appointed as non-executive director.

Forthcoming

Capital structure

Fund details

AGM

July 2020

Ongoing charges

1.02% (0.93% incl. variable fee)

Group

Fidelity International

Interim results

November 2019

Net market gearing*

22.2%

Manager

Dale Nicholls

Year end

31 March

Annual mgmt fee

Variable: 0.7–1.1% of net assets

Address

Beech Gate, Millfield Lane,

Lower Kingswood, Tadworth, Surrey, KT20 6RP

Dividend paid

30 July 2019

Performance fee

None

Launch date

April 2010

Trust life

Indefinite

Phone

0800 41 41 10

Continuation vote

No

Loan facilities

US$150m revolving

Website

www.fidelity.co.uk/chinaspecial

Dividend policy and history (financial years)

Share buyback policy and history (financial years)

Although focused on capital growth, FCSS pays an annual dividend, which has been increased every year since its inception.

FCSS has authority to buy back up to 14.99% and allot up to 10% of its shares in issue. A formal single-digit discount control policy was adopted in June 2019.

Shareholder base (as at 30 September 2019)

Portfolio exposure by market cap (as at 30 September 2019)

Top 10 holdings (as at 30 September 2019)

Portfolio weight %**

Benchmark weight (%)

Active weight vs benchmark (%)

Company

Sector

30 Sept 2019

30 Sept 2018***

Tencent

Communication services

10.9

11.6

14.1

(3.2)

Alibaba

Consumer discretionary

7.9

8.3

13.9

(6.0)

China MeiDong Auto

Consumer discretionary

4.2

2.0

0.0

4.2

China Pacific Insurance

Financials

3.5

3.8

0.6

2.9

China Life Insurance

Financials

2.4

1.9

1.0

1.4

SKSHU Paint

Materials

1.7

N/A

0.0

1.7

China Biologic Products

Healthcare

1.7

N/A

0.0

1.7

21Vianet

Information technology

1.6

1.6

0.0

1.6

Kingdee International Software

Information technology

1.6

1.4

0.1

1.5

Kingsoft

Information technology

1.6

N/A

0.1

1.5

Top 10 (% of holdings)

37.1

36.9

Source: Fidelity China Special Situations, Edison Investment Research, Bloomberg, Morningstar. Note: *Gearing net of short positions. **Adjusted for gearing and index hedges (holdings data may differ from non-adjusted data displayed in FCSS’s factsheet). ***N/A where not in end-September 2018 top 10.

The fund manager: Dale Nicholls

The manager’s view: Domestic consumption holds promise

Nicholls believes that the ongoing US-China trade dispute has resulted in a rift between the two countries that will take a long time to heal, regardless of whether a resolution to the trade dispute is found. Although the tariffs imposed, and the negative rhetoric surrounding the dispute, have hit near-term growth and investor sentiment, the manager says prospects for China and FCSS continue to remain compelling over the medium- to long-term. Nicholls believes that China is committed to upgrading its industrial capabilities to become the global leader in innovation and technology. This aim was articulated in its Made in China 2025 plan, launched in 2015. He notes that the shift of lower-end and more wage sensitive manufacturing capacity out of China has been an ongoing trend for some time; however, its pivotal position in the global supply chain will take time to erode. For example, around 50% of the world’s PCs and 40% of mobile phones are manufactured in China. Furthermore, port infrastructure to facilitate trade is hard to substitute in the short term; China’s top five ports shipped 130m 20 foot equivalent unit containers in 2017, over 3x the volume shipped by the top five ports in ASEAN.

Nicholls finds the most exciting investment opportunities are in domestically oriented companies and the portfolio is positioned to reflect this view. He says China is fiscally constrained and he believes that the government has very limited appetite for broad economic stimulus; however, it is directing policy to promote domestic spending and reforms in areas such as healthcare and pensions. The manager believes the ongoing trend for China’s economy to rebalance away from fixed asset investment and exports in favour of domestic consumption will continue.

The portfolio

The largest sector exposure in the portfolio remains consumer discretionary, which was 28.5% as at end-September 2019. Since our last report in July 2019, this has increased by 1.5pp, reflecting the outperformance of holdings as well as additions to existing positions. Those included Nasdaq-listed Ctrip, China’s leading online travel company, whose services include accommodation reservations, travel tickets and packaged tours. The manager believes the company is a prime beneficiary of the long-term structural growth in Chinese travel.

Recent outperformers included non-index stock China MeiDong Auto, which is the third largest holding (but the largest active weight). The company distributes autos and offers after-sales services. It primarily operates in smaller cities (tier 3 and tier 4), and has the licence to sell a number of mid- to high-end marques, including Toyota, Lexus, Porsche and BMW. Nicholls believes growth prospects are promising given the company’s expansion plans and China’s rapid urbanisation and rising income trends. Sports brand company Li Ning has also been a strong performer. In the manager’s view, the company has successfully executed its strategy to turnaround its business to become a domestic premium brand. After the Beijing Olympics, Li Ning (and other Chinese sportswear companies) suffered following over-expansion of manufacturing capacity and outlets, which resulted in poor margins and the erosion of brand value; whereas the premium segment of the sportswear market was dominated by foreign players such as Nike and Adidas. The manager thinks that Li Ning has now successfully turned its business around and elevated its brand to a premium position, above that of many foreign names. Nicholls believes premiumisation is an important investment theme and that increasingly, the most desirable brands for Chinese consumers will be homegrown.

The manager has recently introduced eco-friendly paint manufacturer, SKSHU Paint into the portfolio, which he believes is also a beneficiary of the urbanisation investment theme. FCSS has also added to several of its existing positions including ShenZhen YUTO Packaging Technology. The company is a leading packaging company for a broad range of industries including consumer electronics, tobacco and cosmetics. It has invested in automation and introduced innovative products that can be personalised and digitalised. In the manager’s view these developments have created a competitive edge for the firm in an otherwise commoditised and labour-intensive industry. Nicholls also added to Noah Holdings, a wealth management company focused on high net worth clients, with minimum assets of RMB3m (around £330,000). In his view, the company has superior product offerings and investment options and he thinks there is significant scope for the company to gain market share given the low penetration and fragmentation of wealth management services in China.

Performance: Medium- and long-term outperformance

As shown in Exhibits 3 and 4, FCSS has delivered strong absolute and relative performance compared to the benchmark MSCI Emerging Markets index over five years and since its inception in April 2010; however, it has lagged over shorter periods. The manager is focused on investing for capital returns over the long term and the portfolio is meaningfully different from the index; therefore, performance can diverge over shorter and medium terms. The manager notes that the MSCI Emerging Markets Index performance over the past three years has been led by a relatively narrow set of mainly large-cap names. FCSS has a mid- and small-cap bias and has meaningfully outperformed the MSCI Small Cap Index over all years shown.

Exhibit 2: Five-year discrete performance data

12 months ending

Share price
(%)

NAV
(%)

MSCI China
(%)

MSCI China Small Cap (%)

MSCI World

(%)

FTSE All-Share
(%)

31/10/15

12.1

13.3

3.1

0.9

6.0

3.0

31/10/16

43.0

42.1

28.7

23.8

28.8

12.2

31/10/17

24.2

22.6

29.9

11.3

13.5

13.4

31/10/18

(17.8)

(19.2)

(13.3)

(15.6)

5.7

(1.5)

31/10/19

12.0

11.0

11.7

(1.0)

11.9

6.8

Source: Refinitiv. Note: All % on a total return basis in pounds sterling.

Exhibit 3: Investment trust performance to 31 October 2019

Price, NAV and benchmark total return performance, one-year rebased

Price, NAV and benchmark total return performance (%)

Source: Refinitiv, Edison Investment Research. Note: Three, five and SI (since inception) performance figures annualised. Inception date is 16 April 2010.

Exhibit 4: Share price and NAV total return performance, relative to indices (%)

 

One month

Three months

Six months

One year

Three years

Five years

SI

Price relative to MSCI China

(3.2)

(3.1)

(7.0)

0.3

(11.4)

16.5

44.3

NAV relative to MSCI China

(1.0)

(1.1)

(4.1)

(0.7)

(15.9)

10.1

70.6

Price relative to MSCI China Small Cap

(1.4)

0.4

(2.0)

13.0

21.4

67.2

114.9

NAV relative to MSCI China Small Cap

0.9

2.4

0.9

12.0

16.9

60.8

141.1

Price relative to MSCI World

(1.8)

(6.0)

(17.7)

0.1

(20.0)

0.0

(49.0)

NAV relative to MSCI World

0.4

(4.0)

(14.8)

(1.0)

(24.4)

(6.4)

(22.8)

Price relative to FTSE All-Share

(2.7)

(6.7)

(13.5)

5.2

(5.0)

45.5

38.4

NAV relative to FTSE All-Share

(0.5)

(4.7)

(10.6)

4.2

(9.4)

39.0

64.6

Source: Refinitiv, Edison Investment Research. Note: Data to end-October 2019. Inception date is 16 April 2010. Geometric calculation.

Exhibit 5: NAV total return performance relative to benchmark over five years

Source: Refinitiv, Edison Investment Research

Valuation: New single-digit discount control policy

FCSS is currently trading at an 9.1% discount to its cum-income NAV, which is below its three-year average of 11.8%. As shown in Exhibit 6, the trust’s discount has been in a narrowing trend over the past three years and broadly traded within a 10–15% range between September 2016 and February 2019, before moving below 10%. The board adopted a formal discount control policy in June 2019, which seeks to maintain the discount in single digits, in normal market conditions. It has the authority (renewed annually) to repurchase up to 14.99% of FCSS shares in issue. During FY19, a modest 1.8m shares were repurchased for a total consideration of £4.1m. Since end-March 2019, 0.5m shares have been repurchased at a cost of £1.0m.

Exhibit 6: Share price discount to NAV (including income) over three years (%)

Source: Refinitiv, Edison Investment Research

General disclaimer and copyright

This report has been commissioned by Fidelity China Special Situations and prepared and issued by Edison, in consideration of a fee payable by Fidelity China Special Situations. Edison Investment Research standard fees are £49,500 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2019 Edison Investment Research Limited (Edison). All rights reserved FTSE International Limited (“FTSE”) © FTSE 2019. “FTSE®” is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under license. All rights in the FTSE indices and/or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and/or FTSE ratings or underlying data. No further distribution of FTSE Data is permitted without FTSE’s express written consent.

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

The Investment Research is a publication distributed in the United States by Edison Investment Research, Inc. Edison Investment Research, Inc. is registered as an investment adviser with the Securities and Exchange Commission. Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1,185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1,185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

General disclaimer and copyright

This report has been commissioned by Fidelity China Special Situations and prepared and issued by Edison, in consideration of a fee payable by Fidelity China Special Situations. Edison Investment Research standard fees are £49,500 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2019 Edison Investment Research Limited (Edison). All rights reserved FTSE International Limited (“FTSE”) © FTSE 2019. “FTSE®” is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under license. All rights in the FTSE indices and/or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and/or FTSE ratings or underlying data. No further distribution of FTSE Data is permitted without FTSE’s express written consent.

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

The Investment Research is a publication distributed in the United States by Edison Investment Research, Inc. Edison Investment Research, Inc. is registered as an investment adviser with the Securities and Exchange Commission. Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1,185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1,185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

Share this with friends and colleagues