PRIMA_subretinal_3D

FY20 results in line, awaiting merger updates

Pixium Vision 3 March 2021 Update
Download PDF

Pixium Vision

FY20 results in line, awaiting merger updates

FY20 update

Healthcare equipment
& services

3 March 2021

Price

€0.97

Market cap

€43m

$1.23/€

Net cash (€m) at 31 December 2020 (excluding lease liabilities)

3.3

Shares in issue

44.0m

Free float

60%

Code

ALPIX

Primary exchange

Euronext Growth Paris

Secondary exchange

N/A

Share price performance

%

1m

3m

12m

Abs

(4.4)

32.3

30.9

Rel (local)

(7.9)

27.2

20.6

52-week high/low

€1.25

€0.50

Business description

Pixium Vision develops bionic vision systems for patients with severe vision loss. Its lead product, Prima, is a wireless sub-retinal implant system designed for dry-AMD. The company recently started a European pivotal study.

Next events

36-month data from EU feasibility study

Q121

Closing of transaction with Second Sight

H121

Analysts

Pooya Hemami, CFA

+1 646 653 7026

Maxim Jacobs, CFA

+1 646 653 7027

Pixium Vision is a research client of Edison Investment Research Limited

Pixium Vision recently announced its FY20 results, which were generally in line with our forecasts. While revenue (predominantly research tax credits and grants) of €2.1m exceeded our €1.7m forecast, G&A costs (€4.0m excluding depreciation) were above expectations, largely due to costs associated with preparations for the Second Sight transaction. Normalised operating loss of €8.0m (excluding a €0.4m impairment charge) was in line with our €7.9m forecast. We are maintaining our valuation approach for Pixium (excluding any contribution from Second Sight) at this time but will revise it on completion of the transaction. After rolling forward our estimates and adjusting G&A forecasts, we now obtain an rNPV of €138.7m for Pixium Vision (standalone) versus €134.0m previously.

Year end

Revenue (€m)

PBT*
(€m)

EPS*
(€)

DPS
(€)

P/E
(x)

Yield
(%)

12/19

1.8

(9.8)

(0.44)

0.0

N/A

N/A

12/20

2.1

(8.7)

(0.26)

0.0

N/A

N/A

12/21e

1.6

(11.0)

(0.25)

0.0

N/A

N/A

12/22e

1.6

(15.5)

(0.34)

0.0

N/A

N/A

Note: *PBT and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments.

Awaiting updates on the MoU

On 6 January, Pixium announced that it had entered into a memorandum of understanding (MoU) with Second Sight (EYES, Nasdaq) to combine their businesses, enabling both companies to pool their resources in complementary sight-restoration neuromodulation technologies and build a one-company solution for many causes of blindness. Pixium will become a holding company that owns 60% of the combined company’s assets (which includes Pixium’s retinal neuromodulation assets and 40% of a subsidiary containing the Orion-related assets), before the consideration of a $25m financing that will be carried out at the level of the newly combined company (and is a condition for completion of the transaction). The transaction is subject to shareholder and French regulatory approval, the attainment of a $25m capital raise (not yet committed) and is guided to close by early Q221.

Current cash runway into FY22; PRIMAvera underway

In January 2021, Pixium raised another €1.25m tranche from its ESGO financing facility and we estimate that its current funds on hand should last into FY22. In late 2020, Pixium started the PRIMAvera European pivotal study of the Prima Bionic Vision System in patients with dry age-related macular degeneration with geographic atrophy, which could provide top-line data in H222. Without considering the combination with Second Sight, our model assumes Pixium will need to raise €35m in funds before 2024 to bring Prima to commercial launch.

Valuation: Awaiting transaction close

After rolling forward our estimates and adjusting G&A assumptions, we obtain an rNPV (enterprise value excluding net cash) for Pixium Vision (standalone) of €138.7m (vs €134.0m previously) but will revisit our assumptions once the necessary steps for the proposed MoU are finished and/or the transaction reaches completion.

FY20 financial update

Pixium recently announced its FY20 results, which were generally in line with our forecasts. Revenue (predominantly research tax credits and grants) of €2.1m exceeded our €1.7m forecast, but with G&A costs (€4.0m excluding depreciation) above expectations (€2.9m), offset by R&D costs (€5.7m) slightly below our projection (€6.3m), the overall normalised operating loss of €8.0m (excluding a €0.4m impairment charge due to certain patents that Pixium decided not to maintain or which had expired) was in line with our €7.9m forecast. The higher-than-expected G&A costs were partly due to costs incurred in relation to the planned combination with Second Sight, announced in early January. Operating cash flow excluding net interest was a €6.2m loss, similar to our prior estimate. The company finished Q420 with €10.6m in gross cash and €7.2m gross debt, resulting in €3.3m in net cash (excluding €1.3m in lease liabilities). This compares with our prior estimates of €13.4m in gross cash and of €3.1m in net cash (excluding lease liabilities). Subsequent to year-end, Pixium raised an additional €1.25m in convertible debt from its ESGO financing facility.

Pixium started the PRIMAvera pivotal study for Prima in Q420 and we await further announcements on recruitment progress. PRIMAvera is an open-label, non-randomized, multi-centre, prospective, single-arm study that will implant and assess the Prima Bionic Vision System (BVS) in 38 patients. Top-line, 12-month data could be sufficient for approval purposes, although patients will be followed for three years. We believe the PRIMAvera study may provide top-line, 12-month data in H222, supporting our estimate of potential CE mark and European launch in H223. Pixium remains in discussions with US regulatory authorities to explore the possibility of conducting this study in parallel in Europe and the US which, if accepted by the FDA, could lead to a US launch earlier than our baseline estimate of H225.

Awaiting updates on combination with Second Sight

On 6 January, Pixium Vision announced that it had entered into an MoU with Second Sight to combine the two businesses. The stock-based transaction, which will also comprise a c $25m capital raise, will enable both companies to pool their resources in complementary sight-restoration neuromodulation technologies and build a one-company solution for many causes of blindness. The combined company’s Nasdaq listing may also provide broader access to US-based investors for future fund-raising needs. The transaction is subject to shareholder and French regulatory approval, the attainment of a $25m capital raise (not yet committed) and is guided to close by early Q221.

Operationally, there should be no change in Prima’s advancement as the core Prima-related operations will remain at their current location in France, and no major changes in R&D and operations headcount are anticipated. Details on the strategic rationale of the transaction and on Second Sight’s Orion system are discussed in our prior note.

Review of mechanics of the Second Sight transaction

The MoU lists several steps whereby Pixium Vision will become a holding company that owns 60% of the combined company’s assets (which includes Pixium’s retinal neuromodulation assets and 40% of a subsidiary containing the Orion-related assets), before the consideration of a $25m financing that will be carried out at the level of the new combined company.

Exhibit 1: Structure of business combination

Source: Pixium Vision and Second Sight presentation

Under the MoU, Second Sight will form a subsidiary, SpinCo, and enter into a separation and distribution agreement and an exclusive licence agreement with SpinCo whereby:

Second Sight will transfer to SpinCo certain intellectual property related to its Orion system and other related assets and liabilities;

SpinCo grants Second Sight an exclusive right of first refusal to commercialise the Orion system; and

a total of 60% of SpinCo’s shares will be spun off to Second Sight shareholders before any combination with Pixium Vision.

In parallel with (and as a condition for) the formal combination, approximately $25m is expected to be raised through a capital increase that will be carried out at the combined company (CombCo) level. Pixium will transfer all of its assets and liabilities for its Prima-related retinal neuromodulation technology to Second Sight in exchange for 34.9m newly issued Second Sight shares (currently there are 23.2m Second Sight shares outstanding). This would give Pixium 60% ownership (pre-financing) of the new Second Sight (CombCo), but this process is contingent on:

securing a $25m financing at the CombCo level (investment commitments have not yet been secured);

a positive shareholder approval vote by both parties (30% of Second Sight shares have already entered into a voting agreement to vote in favour of the MoU; shareholder votes are expected in March); and

clearance from the French Minister for the Economy (for Pixium Vision to contribute to Second Sight all its assets and liabilities in relation to its retinal neuromodulation technology).

After the transaction, Pixium Vision will effectively become a holding company, maintain its Euronext Growth listing and will hold a 60% interest (pre-financing) in CombCo. Pixium CEO Lloyd Diamond will become the CEO of CombCo (to remain Nasdaq listed) and a general director of Pixium Vision.

Pre-financing, Pixium and its board will have effective control over CombCo’s operations. However, depending on the share price and terms of the planned $25m CombCo financing, Pixium may no longer be the majority shareholder after the financing (as we do not expect Pixium to participate in this financing), although it would still very likely be the controlling shareholder. Given Second Sight’s widespread shareholder base (collectively owning 40% of CombCo pre-financing), we believe it would be very unlikely for Pixium to lose effective control over CombCo, even after the $25m financing. Below we provide a sensitivity analysis of Pixium’s ownership stake of CombCo after a $25m financing, at different share price assumptions. On 1 March 2021, Second Sight’s closing price was $1.87 and its trading range since 6 January has been fairly wide, between c $1.65 and $2.70.

Exhibit 2: Scenario analysis for Pixium Vision ownership stake of CombCo after financing

Share price assumption ($) for CombCo's $25m capital raise

0.75

1.25

1.75

2.25

2.75

Number of CombCo shares held by Pixium Vision (m)

34.9

34.9

34.9

34.9

34.9

Total CombCo shares outstanding pre-financing (m)

58.0

58.0

58.0

58.0

58.0

Pre-financing ownership by Pixium Vision of CombCo (%)

60.1

60.1

60.1

60.1

60.1

Number of shares issued as part of $25m financing (m)

33.3

20.0

14.3

11.1

9.1

Total CombCo shares outstanding post-financing (m)

91.3

78.0

72.3

69.1

67.1

Pixium Vision ownership stake of CombCo post-financing (%)

38.2

44.7

48.3

50.5

52.0

Source: Edison Investment Research

Financials and valuation

We have slightly adjusted our forecasts to take into account the higher than projected G&A cost burn rate in FY20, but our core valuation methodology continues to consider Pixium Vision as a standalone entity (pre-merger). Following minor increases in our G&A assumptions and after rolling forward our estimates, we now obtain an rNPV of €138.7m for Pixium Vision (standalone), versus €134.0m previously. After adding €3.3m in net cash, we obtain a valuation of €142.0m, or €3.23 per share. We reiterate that the company is planning a €25m capital increase as part of the transaction with Second Sight, which could lead to meaningful dilution.

As stated above, the company finished Q420 with €10.6m in gross cash and raised an additional €1.25m in convertible debt from its ESGO financing facility in January 2021. Without considering the combination with Second Sight, our model assumes Pixium will need to raise €35m in funds between year-end 2020 and year-end 2023, modelled as illustrative long-term debt, to complete the PRIMAvera pivotal study, all EU-related regulatory and preparatory commercial activities, and bring Prima to commercial launch. We expect to revisit our assumptions once the necessary steps for the proposed MoU are completed and/or the Second Sight transaction reaches completion.

Exhibit 3: Financial summary

€’000s

2017

2018

2019

2020

2021e

2022e

31-December

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

PROFIT & LOSS

Revenue

 

 

2,535

1,598

1,782

2,092

1,600

1,600

Cost of Sales

(1,124)

(41)

0

0

0

0

General & Administrative

(5,324)

(2,019)

(3,572)

(4,017)

(3,303)

(4,185)

Research & Development

(7,817)

(5,297)

(6,563)

(5,711)

(8,000)

(10,400)

EBITDA

 

 

(11,731)

(5,758)

(8,352)

(7,636)

(9,703)

(12,985)

Depreciation

(936)

(677)

(448)

(366)

(409)

(497)

Amortization

0

0

0

0

0

0

Operating Profit (before exceptionals)

 

(12,666)

(6,435)

(8,801)

(8,003)

(10,112)

(13,483)

Exceptionals

0

(5,859)

(69)

(448)

0

0

Other

0

0

0

0

0

0

Operating Profit

(12,666)

(12,294)

(8,870)

(8,450)

(10,112)

(13,483)

Net Interest

(876)

(1,277)

(1,006)

(700)

(931)

(2,001)

Profit Before Tax (norm)

 

 

(13,542)

(7,712)

(9,806)

(8,703)

(11,043)

(15,484)

Profit Before Tax (FRS 3)

 

 

(13,542)

(13,571)

(9,876)

(9,150)

(11,043)

(15,484)

Tax

0

0

0

0

0

0

Profit After Tax and minority interests (norm)

(13,542)

(7,712)

(9,806)

(8,703)

(11,043)

(15,484)

Profit After Tax and minority interests (FRS 3)

(13,542)

(13,571)

(9,876)

(9,150)

(11,043)

(15,484)

Average Number of Shares Outstanding (m)

13.3

18.5

22.3

34.0

44.4

45.0

EPS - normalised (€)

 

 

(1.02)

(0.42)

(0.44)

(0.26)

(0.25)

(0.34)

EPS - normalised and fully diluted (€)

 

(1.02)

(0.42)

(0.44)

(0.26)

(0.25)

(0.34)

EPS - (IFRS) (€)

 

 

(1.02)

(0.73)

(0.44)

(0.27)

(0.25)

(0.34)

Dividend per share (€)

0.0

0.0

0.0

0.0

0.0

0.0

BALANCE SHEET

Fixed Assets

 

 

9,649

3,666

4,507

3,411

3,226

2,772

Intangible Assets

7,680

2,623

2,361

1,727

1,727

1,727

Tangible Assets

1,970

1,042

2,145

1,684

1,499

1,046

Current Assets

 

 

14,241

17,756

9,107

12,721

13,570

11,493

Short-term investments

0

0

0

0

0

0

Cash

10,532

15,629

6,792

10,566

11,331

9,253

Other

3,710

2,126

2,316

2,155

2,240

2,240

Current Liabilities

 

 

(2,752)

(2,044)

(2,880)

(3,795)

(2,559)

(2,559)

Creditors

(2,752)

(2,044)

(2,880)

(3,260)

(2,023)

(2,023)

Short term borrowings

0

0

0

(536)

(536)

(536)

Long Term Liabilities

 

 

(9,302)

(8,023)

(7,033)

(7,851)

(20,351)

(32,851)

Long term borrowings

(9,130)

(7,870)

(5,787)

(6,695)

(19,195)

(31,695)

Other long-term liabilities

(172)

(153)

(1,246)

(1,157)

(1,157)

(1,157)

Net Assets

 

 

11,836

11,355

3,700

4,485

(6,114)

(21,145)

CASH FLOW

Operating Cash Flow

 

 

(10,605)

(6,174)

(7,282)

(6,206)

(10,580)

(12,532)

Net Interest

(876)

(1,277)

(1,006)

(700)

(931)

(2,001)

Tax

0

0

0

0

0

0

Capex

(191)

(31)

(34)

(82)

(224)

(44)

Acquisitions/disposals

0

0

0

0

0

0

Financing

519

14,068

2,034

9,055

0

0

Net Cash Flow

(11,153)

6,587

(6,288)

2,068

(11,735)

(14,577)

Opening net debt/(cash)

 

 

(12,911)

(1,401)

(7,760)

(1,004)

(3,336)

8,400

HP finance leases initiated

0

0

0

0

0

0

Other

(357)

(228)

(468)

264

0

(0)

Closing net debt/(cash)

 

 

(1,401)

(7,760)

(1,004)

(3,336)

8,400

22,977

Lease debt

N/A

N/A

1,346

1,258

1,258

1,258

Closing net debt/(cash) inclusive of IFRS 16 lease debt

(1,401)

(7,760)

342

(2,078)

9,658

24,235

Source: Company accounts, Edison Investment Research


General disclaimer and copyright

This report has been commissioned by Pixium Vision and prepared and issued by Edison, in consideration of a fee payable by Pixium Vision. 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 2021 Edison Investment Research Limited (Edison).

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

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

1185 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 Pixium Vision and prepared and issued by Edison, in consideration of a fee payable by Pixium Vision. 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 2021 Edison Investment Research Limited (Edison).

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

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

1185 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