pill-1884775_960_720

FY21 results reflect puts and takes

Diurnal Group 21 April 2022 Update
Download PDF

Diurnal Group

FY21 results reflect puts and takes

Financial update

Pharma & biotech

22 April 2022

Price

15.25p

Market cap

£26m

US$1.31/£

Net cash (£m) at 31 December 2021

24.4

Shares in issue

169.3m

Free float

68.1%

Code

DNL

Primary exchange

LSE

Secondary exchange

N/A

Share price performance

%

1m

3m

12m

Abs

(53.1)

(75.0)

(78.5)

Rel (local)

(54.2)

(74.8)

(80.1)

52-week high/low

71p

15p

Business description

Diurnal Group is a specialty pharma company developing new formulations of hormone-based products for the treatment of endocrine disorders. Alkindi is marketed for paediatric adrenal insufficiency (AI) in the US and EU. Efmody is approved for the treatment of CAH in the EU and UK.

Next events

CHAMPAIN study headline data

End-CY22

Analyst

Nidhi Singh

+44 (0)20 3077 5700

Diurnal Group is a research client of Edison Investment Research Limited

Diurnal’s H122 results were hindered by COVID-19 pandemic restrictions muting the benefits from the H2 CY21 Efmody launches in Germany, UK and Austria. Further, the recent Scottish Medicines Consortium (SMC) decision to not recommend Efmody for automatic reimbursement in NHS Scotland poses as a headwind and has caused management to lower revenue guidance. Despite management’s focus on expanding into incremental markets, it now expects that for Efmody to become a profitable franchise, the product will require approval for the treatment of AI (projected in CY24). Hence, the company expects it will require additional funding to reach profitability. Martin Whitaker, CEO and board member, has announced plans to step down immediately. The adverse market sentiment has put significant pressure on shares, which are trading below the cash value. We have placed our valuation and financial forecasts under review.

Year end

Revenue (£m)

PBT*
(£m)

EPS*
(p)

DPS
(p)

P/E
(x)

Yield
(%)

06/20

6.3

(5.1)

(4.1)

0.0

N/A

N/A

06/21

4.4

(11.1)

(7.0)

0.0

N/A

N/A

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

H122 update

Diurnal recently reported H122 results; revenue was up 75.0% (y-o-y) to £2.13m due to improved Alkindi sales (45.7% y-o-y) with continued growth in core markets (UK, Germany, Italy and Austria) and initial Efmody sales (£0.39m). Efmody was launched in September 2021 in Germany, the UK and Austria. In October, Diurnal signed a distribution agreement with ExCEEd Orphan for Central and East European countries (for Alkindi and Efmody), with an agreement with Vector Pharma for the Middle East and North Africa (Alkindi) signed in March as part of its global roll-out plan.

The SMC has decided not to recommend Efmody

The SMC announced it has not recommended Efmody for automatic reimbursement in NHS Scotland for the treatment of congenital adrenal hyperplasia (CAH) in adults. Diurnal plans to re-submit further clinical and health-economic data; however, it has shifted its near-term focus to the commercial launch of Efmody in other European markets and to exploring more distribution deals.

Valuation: Forecasts under review

Given the company’s disclosure that it only expects Efmody to become a profitable franchise once regulatory approval in AI is attained, which is not anticipated before CY24, we are placing our forecasts and valuation under review.

Financials update

In H122, the company reported revenue of £2.13m, up 75.0% y-o-y, from £1.21m in H121, mainly led by improved Alkindi sales and initial product sales of Efmody. Alkindi sales grew 45.7% y-o-y to £1.73m due to continued growth in core markets (the UK, Germany, Italy and Austria) amid the continued impact of COVID-19 pandemic-related restrictions. Efmody recorded initial product sales of £0.39m as the product was launched in Germany in September 2021, followed by launches in the UK and Austria. The company’s operating loss increased to £9.20m in H122 from £5.26m in H121, mainly due to increased R&D expenditure in clinical studies and enhanced selling and distribution expenses for Efmody launch preparations across Europe. Diurnal’s operating cash burn rate has accelerated in H122 (£10.6m vs £4.2m in H121), reflecting increased SG&A expenses due to ongoing commercialisation activity and higher R&D spending.

Net cash was £24.4m at H122 (H121: £34m), which, according to recent burn rates, should be sufficient to fund its clinical programmes until CY23.

Exhibit 1 includes some of the important catalysts to look for in 2022 and 2023.

Exhibit 1: Key catalysts

Anticipated acceptance of revised DNL 0300 protocol by FDA

Q2 CY22

R&D day (7 September)

Q3 CY22

Read out of modified release hydrocortisone AI line extension study

H2 CY22

European regulatory submission of modified release hydrocortisone AI line extension

H1 CY23

Recruitment complete in modified release hydrocortisone Phase III CONNECT study

H1 CY23

Anticipated acceptance of revised DNL 0300 protocol by FDA

R&D day (7 September)

Read out of modified release hydrocortisone AI line extension study

European regulatory submission of modified release hydrocortisone AI line extension

Recruitment complete in modified release hydrocortisone Phase III CONNECT study

Q2 CY22

Q3 CY22

H2 CY22

H1 CY23

H1 CY23

Source: Diurnal Group, Edison Investment Research

Global roll-out for Alkindi

Diurnal’s first launched product, Alkindi, is an immediate-release formulation of hydrocortisone intended to treat paediatric AI and the related condition, CAH. Alkindi is a niche product for a relatively small population, but it is a group of patients that has historically been underserved. Alkindi is the first and only product approved for paediatric AI. It was launched directly by Diurnal in its core markets (the UK, Germany, Italy and Austria), and through its distribution partners, such as Frost Pharma in Sweden, Denmark, Norway and Iceland, and Eton Pharmaceuticals in the United States. In November 2021, Swissmedic (the authorisation and supervisory authority for drugs and medical products in Switzerland) approved Alkindi, which added one more territory for the upcoming launch of the product.

In H122, the company expanded its geographical reach by entering into more distribution agreements to ensure global roll-out for Alkindi, such as the distribution agreement with ExCEEd Orphan in October 2021 to market its products (both Alkindi and Efmody) in Central and East European countries and a distribution deal with Vector Pharma in March 2022 for the Middle East and Africa for Alkindi.

Although Diurnal has made significant progress towards setting up the supply chain for Alkindi, revenue growth has been modest mainly due to the impact of the COVID-19 pandemic on patients' ability to visit hospitals and physicians' ability to switch patients to Alkindi. In another effort to push for Alkindi sales, in November 2021, Eton Pharmaceuticals (Diurnal’s US partner for Alkindi Sprinkle) signed a co-promotion deal with Tolmar Pharmaceuticals to promote Alkindi Sprinkle to its targeted physicians. The deal is likely to be helpful in promoting the adoption of Alkindi Sprinkle in United States. As a reminder, Alkindi was approved in the United States in 2020. This agreement is in addition to Eton’s digital marketing campaign to raise awareness, indicating a significant focus on ramping up sales.

Efmody hits roadblock after SMC decision

Diurnal’s second commercial product, Efmody, is a modified-release oral formulation of hydrocortisone for adults with CAH (measured by androgen), which is designed to closely mimic the natural circadian rhythm of cortisol release from the adrenal glands. Following European Economic Area and Great Britain approval in 2021, Diurnal launched Efmody in three of its key markets (Germany, the UK and Austria). Diurnal plans to use Alkindi’s supply chain and distribution network for Efmody as well, and therefore most of its existing Alkindi distribution agreements have been extended to incorporate Efmody (eg Consilient Health in the Netherlands, ExCEEd in CEE countries, etc.).

In a discouraging development, in March 2022 the SMC announced it has not recommended Efmody for automatic reimbursement in NHS Scotland. The SMC indicates its decision was mainly due to Diurnal not presenting sufficiently robust clinical and economic analysis to gain acceptance by SMC. The company plans to re-submit further clinical and health-economic data in the near future. A further opportunity to engage with SMC could be following results from the CHAMPAIN study for the treatment in AI, expected in late CY22, and discussed further below. Headline data for Efmody’s Phase III clinical trial in US (also described below) in anticipated in H1 CY24 and may also provide Diurnal an opportunity to present its case. We expect to have more clarity on the product pipeline and commercialisation status at the R&D day in September 2022.

The SMC’s decision will likely have a material impact on Efmody’s UK roll-out plan as a number clinical commissioning groups within the UK rely on SMC. There is also a possibility that after the SMC decision, other reimbursement authorities’ approvals might take longer, which may have a larger effect on overall Efmody sales forecasts; however, the recent reimbursement approval from Norway is a positive step. Ultimately, management guided that Efmody will not be able to meet the company’s prior near-term sales expectations due to the SMC decision and the company also states there is a need for a further capital raise to reach profitability. Moreover, it now expects that for Efmody to become a profitable franchise, the product will require approval for the treatment of AI (which it expects in CY24).

Investors reacted to these events, as Diurnal’s share price declined 20% on the day of the SMC announcement (7 March) and dropped a further 50% after Efmody guidance was downgraded with the H122 results.

In response, the company has shifted its near-term focus to the commercial launch of Efmody in other European markets and to exploring more distribution deals. In CY22, the product is likely to be launched in other important markets, such as Italy, Spain and the Netherlands. We remain confident about Diurnal’s ability to scale up sales of its products in other territories in the near future, given the supply chain and distribution infrastructure is already in place.

Exhibit 2: Diurnal distribution partnerships/distribution agreements

Company

Territories

Products

Type of deal

Financials

Upfront/milestones

Eton Pharmaceuticals

US, Canada

Alkindi Sprinkle

License

Royalties + milestones

Upfront: $5m;

Milestone: $47.5m

Rarestone

China

Alkindi and Efmody

License

Royalties + milestones

Upfront: $1.5m;
Milestone: $41.5m

Er-Kim

Turkey, Bulgaria, Romania

Alkindi and Efmody

Distribution

Revenue share

-

Frost Pharma

Nordics

Alkindi

Distribution

Revenue share

-

Consilient Health

Nordics, Benelux

Alkindi and Efmody

Distribution

Revenue share

Undisclosed

Chiesi

Australia, New Zealand

Alkindi and Efmody

Distribution

Revenue share

-

Medison

Israel

Alkindi and Efmody

Distribution

Revenue share

-

EffRx

Switzerland

Alkindi

Distribution

Revenue share

-

Exceed Orphan

Central and Eastern Europe

Alkindi and Efmody

Distribution

Revenue share

-

Vector Pharma

Middle East and North Africa

Alkindi

Distribution

-

-

Source: Diurnal, Edison Investment Research

Management changes

On 4 April, Diurnal announced that Martin Whitaker (CEO and member of the board) has decided to step down from both roles with immediate effect to pursue other business opportunities. The CFO, Richard Bungay, has taken over as interim CEO until the company finds someone else. While the sudden departure of the CEO may provoke short-term investor anxiety, particularly after the SMC issues with Efmody and lowered guidance, we do not anticipate material changes to the roll-out strategy of Efmody/Alkindi in other markets in FY22.

Pipeline update

CONnECT study (DNL-0200)

After Efmody’s approval in Europe, Diurnal is seeking to obtain approval for Efmody in the United States. Efmody (previously Chronocort, DNL-0200) is in a registration study for CAH in the United States called ‘A randomised, double-blind, active-controlled, Phase 3 study of Chronocort compared with immediate-release hydrocortisone replacement therapy in participants aged 16-years and over with CAH’ (CONnECT). The Phase III trial has been started; the first clinical site was opened for recruitment in December 2021, following a special protocol assessment with the FDA announced in July 2021. The trial will enrol up to 150 patients with CAH, who will be treated for 52 weeks.

The study design is complex. There is four weeks of screening followed by a four-week run-in period in which patients switch to immediate release hydrocortisone (IRHC) 30mg daily, before beginning the double-blind, placebo-controlled, 12-month treatment. The proposed primary endpoint is biochemical responder non-inferiority of Efmody twice daily versus twice daily IRHC after 52 weeks of randomised treatment. The company has estimated that the trial could be completed in 2023, with an NDA filing in 2024. This study will be accepted by the Japanese Pharmaceutical and Medical Devices Agency on the condition that a cohort of Japanese patients will also be included in the study. As a further step, the company intends to include sites in France and Turkey to maximise patient accrual rates. The first sites have been opened in United States for recruitment and management guides that the headline data will be released in H1 CY24.

CHAMPAIN study (DNL-0200)

Diurnal plans to develop and expand Efmody’s franchise towards the related condition of AI (currently approved in CAH only) across Europe and the United States. Diurnal is working on Efmody’s European Phase II study in AI, called the CHAMPAIN study. This European Phase II study started against the approved product Plenadren in Europe; the first sites have been opened for recruitment and the first patient has been dosed. Phase II headline data are expected at end CY22. We believe a Phase III study will also be required for approval in this indication.

DITEST study (DNL-0300)

In addition to its hydrocortisone products, Diurnal is also developing a novel oral formulation of testosterone (DNL-0300, formerly called DITEST) for the treatment of hypogonadism. Oral testosterone supplements can avoid the issue of transference that gel-based products usually have. Currently available oral products use an undecanoate ester of testosterone, which dramatically improves bioavailability over uncodified testosterone by avoiding first-pass metabolism. However, testosterone undecanoate has a substantial food effect. The DNL-0300 product is a formulation of unmodified testosterone that seeks to avoid the issues of poor bioavailability (generally associated with unmodified testosterone) by using a proprietary, oil-based excipient mixture, and without a high fat meal requirement. After encouraging results reported in November 2019 from a Phase I study in the United States, the FDA confirmed that DNL-0300 can progress to a new drug application via the abbreviated 505(b)(2) route (which allows for accelerated time to approval compared to FDA-designated new chemical entities). In this route, Diurnal will be working on only two clinical studies, that is a Phase I multiple-ascending dose study and a single pivotal Phase III trial, before applying for marketing approval. The company submitted an Investigational new drug application (IND) in January 2022 and, in March 2022, received feedback from the FDA to resubmit a revised protocol as part of the IND filing for initiation of the Phase I clinical study, enabling it to potentially finalise the clinical trial design.

Exhibit 3: Diurnal’s other assets in clinical trials

Candidate

Indication

Region

Clinical status

Estimated regulatory opinion

Annual addressable market

DNL-0200
(Modified-release hydrocortisone)

CAH

US

Phase III

2025

$0.1bn

AI

Europe

Phase II

2024

$2.9bn

AI

US

Phase I

2026

DNL-0300
(Oral Native Testosterone)

Classical hypogonadism

US

Phase I

2026

$5.1bn

Europe

Phase I

TBC

DNL-0400
(Modified-release T3)

Hypothyroidism
(T4 non-responders)

US

Pre-clinical

TBC

$0.7bn

Europe

Pre-clinical

TBC

DNL-0500
(Oligonucleotide therapy)

Cushing's disease

US

Pre-clinical

TBC

$0.5bn

Europe

Pre-clinical

TBC

Source: Diurnal, Edison Investment Research

Valuation

Given the company’s disclosure that it only expects Efmody to become a profitable franchise once regulatory approval in AI is attained, which is not anticipated before CY24, we are placing our forecasts and valuation under review.

Exhibit 4: Financial summary

£000s

2020

2021

30-June

IFRS

IFRS

INCOME STATEMENT

Sales

2390

2267

Royalties & Milestones

3923

2104

Revenue

 

 

6,313

4,371

Cost of Sales

(668)

(779)

Gross Profit

5,645

3,592

EBITDA

 

 

(5,151)

(11,125)

Operating Profit (before amort. and excepts.)

 

 

(5,176)

(11,149)

Amortisation of acquired intangibles

0

0

Exceptionals

627

15

Share-based payments

(843)

(466)

Reported operating profit

(5,392)

(11,600)

Net Interest

114

62

Joint ventures & associates (post tax)

0

0

Exceptionals

0

0

Profit Before Tax (norm)

 

 

(5,062)

(11,087)

Profit Before Tax (reported)

 

 

(5,278)

(11,538)

Reported tax

1,206

1,489

Profit After Tax (norm)

(3,905)

(9,656)

Profit After Tax (reported)

(4,072)

(10,049)

Minority interests

0

0

Discontinued operations

0

0

Net income (normalised)

(3,905)

(9,656)

Net income (reported)

(4,072)

(10,049)

Average Number of Shares Outstanding (m)

95

137

EPS - basic normalised (p)

 

 

(4.1)

(7.0)

EPS - normalised fully diluted (p)

 

 

(4.1)

(7.0)

EPS - basic reported (p)

 

 

(4.3)

(7.3)

Dividend (p)

0.0

0.0

BALANCE SHEET

Fixed Assets

 

 

1,770

240

Intangible Assets

79

92

Tangible Assets

23

148

Investments & other

1,668

0

Current Assets

 

 

19,206

41,550

Stocks

1,241

1,625

Debtors

1,337

3,433

Cash & cash equivalents

15,434

34,037

Other

1,194

2,455

Current Liabilities

 

 

(2,555)

(4,163)

Creditors

(2,555)

(4,163)

Tax and social security

0

0

Short term borrowings

0

0

Other

0

0

Long Term Liabilities

 

 

(36)

(63)

Long term borrowings

0

0

Other long term liabilities

(36)

(63)

Net Assets

 

 

18,385

37,564

Minority interests

0

0

Shareholders' equity

 

 

18,385

37,564

CASH FLOW

Operating Cash Flow

(5,151)

(11,125)

Working capital

(380)

(845)

Exceptional & other

(1,398)

109

Tax

2,120

1,199

Net operating cash flow

 

 

(4,809)

(10,662)

Capex

(45)

(163)

Acquisitions/disposals

0

0

Net interest

114

62

Equity financing

10,670

28,762

Dividends

0

0

Other

0

713

Net Cash Flow

5,930

18,712

Opening net debt/(cash)

 

 

(9,147)

(15,434)

FX

357

(109)

Other non-cash movements

0

0

Closing net debt/(cash)

 

 

(15,434)

(34,037)

Source: Diurnal, Edison Investment Research. Note: Diurnal’s financial year end has changed to December, therefore, the next results will be interim.

General disclaimer and copyright

This report has been commissioned by Diurnal Group and prepared and issued by Edison, in consideration of a fee payable by Diurnal Group. Edison Investment Research standard fees are £60,000 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 2022 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 Diurnal Group and prepared and issued by Edison, in consideration of a fee payable by Diurnal Group. Edison Investment Research standard fees are £60,000 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 2022 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