JDC Group — Accelerating again in FY24

JDC Group (SCALE: JDC)

Last close As at 22/05/2024

EUR23.40

−0.40 (−1.68%)

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EUR324m

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Research: Financials

JDC Group — Accelerating again in FY24

JDC Group (JDC) reported FY23 results that were in line with the preliminary results published on 8 March. After a very strong Q423, JDC expects FY24 revenue growth to accelerate to c 17% (FY23: 10.0%) and EBITDA to grow by 36% (FY23: 30.2%) at the midpoint of guidance. To reach the FY25 target of €246m in revenue, JDC also needs 17% top-line growth in FY25. JDC trades at an FY25e EV/EBITDA multiple of 13.7x on our estimates, which we believe is undemanding for what is essentially a fast-scaling platform business. Our DCF provides a valuation of €34.04/share (versus €34.09/share previously).

Edwin de Jong

Written by

Edwin De Jong

Analyst

Financials

JDC Group

Accelerating again in FY24

FY23 results update

Diversified financials

8 April 2024

Price

€22.4

Market cap

€301m

Net cash (€m) at end FY23

7.0

Shares in issue

13.7m

Free float

51%

Code

JDC

Primary exchange

Deutsche Börse Scale

Secondary exchange

N/A

Share price performance

%

1m

3m

12m

Abs

7.7

19.6

23.5

Rel (local)

4.9

9.2

5.5

52-week high/low

€24.0

€14.8

Business description

JDC Group is a leading German insurance platform, providing advice and financial services for professional intermediaries and banks but also directly to end-customers. JDC’s digital platform, for end-clients and for the administration and processing of insurance products, is also provided as a white-label product.

Next events

Q124 results

15 May 2024

AGM

18 July 2024

Analyst

Edwin De Jong

+44 (0)20 3077 5700

JDC Group is a research client of Edison Investment Research Limited

JDC Group (JDC) reported FY23 results that were in line with the preliminary results published on 8 March. After a very strong Q423, JDC expects FY24 revenue growth to accelerate to c 17% (FY23: 10.0%) and EBITDA to grow by 36% (FY23: 30.2%) at the midpoint of guidance. To reach the FY25 target of €246m in revenue, JDC also needs 17% top-line growth in FY25. JDC trades at an FY25e EV/EBITDA multiple of 13.7x on our estimates, which we believe is undemanding for what is essentially a fast-scaling platform business. Our DCF provides a valuation of €34.04/share (versus €34.09/share previously).

Year end

Revenue
(€m)

EBITDA
(€m)

EPS
(€)

DPS
(€)

EV/EBITDA
(x)

P/E
(x)

12/22

156.1

9.0

0.07

0.0

25.9

267.8

12/23

171.7

11.7

0.28

0.0

20.2

63.7

12/24e

212.9

15.3

0.37

0.0

19.8

59.9

12/25e

250.0

22.3

0.74

0.0

13.7

30.3

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

FY23 results in line with preliminary numbers

JDC announced FY23 and Q423 results that were in line with the preliminary numbers reported on 8 March. FY23 revenues increased 10.0% to €171.7m. This relatively low revenue growth was driven by a lower-than-expected recovery of Advisory revenue after a weak start to the year (-4.3%), while Advisortech, the insurance platform, reported good growth of 13.5%, foremost driven by the major clients (+25.9%). Operating leverage from the platform is getting more visible with EBITDA growth of 30.6% to €11.7m. All in all, we have made relatively small adjustments to our FY24 and FY25 estimates.

Top Ten/major clients drive revenue growth to >20%

FY24 is expected to be a particularly strong growth year for JDC, especially due to the acquisition of Top Ten Group, which will be consolidated for 12 months instead of one month in FY23. We expect a sales contribution in FY24 of €18m from Top Ten. Because Top Ten’s business has lower margins, JDC’s EBITDA margin improvement in FY24 should be smaller than last year. However, we expect a further increase in profitability in FY25 as the integration of Top Ten progresses, the adoption of JDC’s platform at savings bank- and cooperative bank-related insurers accelerates and because of a more significant contribution from the Summitas joint venture with Bain Capital and Great-West Lifeco (GWL), JDC’s largest shareholder.

Valuation: FY24e EV/EBITDA of 13.7x

JDC trades at an FY25e P/E of 30.3x and EV/EBITDA of 13.7x based on our estimates. Compared to the average of platform peers like Hypoport and Goosehead, JDC’s EV/EBITDA discount is relatively stable (22%), while its premium compared to financial brokers like Netfonds and Aon is getting higher (36%), which in our view indicates that JDC is increasingly perceived as a platform company. A DCF analysis based on our updated estimates implies a valuation of €34.04/share.

A strong finish in FY23

JDC released FY23 results that were in line with its preliminary results reported on 8 March. Revenue was up 10.0% to €171.7m, but below the guided range of €175–190m and our estimate of €182.3m. Nevertheless, EBITDA was in line with the lower end of guidance at €11.7m, compared with guidance of €11.5–13m and our estimate of €12.2m. JDC had a very strong Q423, with a revenue increase of 21.2% to €48.8m and an EBITDA of €5.0m, which is by far the highest level JDC has reached in one quarter so far, driven by a strong gross margin improvement and modest cost development.

Advisortech, JDC’s platform business, saw revenue increase by 13.5% in FY23 (21.6% higher in Q4), while Advisory revenue was 4.3% lower (16.1% higher in Q4). The number of platform transfers more than doubled in 2023 to 498,393 and the annual net premium going through JDC’s platform is now comfortably >€1bn and will reach €1.2bn soon, according to the company. Key customers contributed a €7.5m increase in turnover for JDC in FY23 and accounted for 24.3% of Advisortech revenues. This will be the main driver for JDC’s revenues in the coming years. Nevertheless, independent financial advisers (IFAs) still account for the majority of Advisortech sales (73.8%) and also saw a robust increase in FY23 of €10.7m in revenues.

The commission expense, the amount of commission that JDC had to pass through to its platform members, was flat at 71.2% of total revenues, versus 71.3% in 2022, so the revenue increase was really driven by more contracts on JDC’s platform. Meanwhile cost control was strict with an increase in staff expense of 6%, which we find low for a growing organisation in Germany. Other operating expenses increased 6.3%. The combination of 10% revenue growth with a lower increase in costs resulted in an EBITDA increase of 30.6% to €11.7m. Net income improved to €3.8m from €0.9m in 2021 and 2022.

Exhibit 1: FY23 results highlights

€m

FY20

FY21

FY22

FY23

FY23 y-o-y change

Total revenue

122.8

146.8

156.1

171.7

10.0%

– Advisortech

102.6

121.0

132.9

150.8

13.5%

– Advisory

30.9

35.7

34.7

33.2

-4.3%

– Holding

(10.6)

(9.9)

(11.5)

(12.4)

7.4%

Initial commission

85.5

100.2

102.2

117.8

15.3%

Insurance products

64.1

77.3

83.5

101.1

21.1%

Investment funds

16.0

15.9

12.7

12.5

-1.3%

Shares/closed-end funds

5.4

7.0

6.1

4.2

-30.9%

Follow-up commission

21.2

26.0

29.4

31.3

6.4%

Overrides

6.5

6.8

6.9

6.4

-6.9%

Services

3.5

4.4

3.5

2.0

-42.3%

Fee-based advisory

2.8

3.1

3.4

3.0

-12.7%

Other income

3.4

6.3

10.7

11.2

4.6%

Capitalised services

1.1

1.2

1.4

1.7

23.2%

Other operating income

0.3

0.7

1.6

1.8

10.8%

Commission expenses

(90.5)

(107.0)

(111.3)

(122.3)

9.9%

Commission expense as % of revenues

73.7%

72.9%

71.3%

71.2%

-0.1%

Personnel expenses

(18.7)

(22.3)

(27.2)

(28.8)

6.0%

Other operating expenses

(9.9)

(11.0)

(11.6)

(12.3)

6.3%

EBITDA

5.1

8.4

9.0

11.7

30.6%

D&A

(4.6)

(5.4)

(6.1)

(5.9)

-3.5%

EBIT

0.5

3.0

2.9

5.8

99.3%

Associates

(1.0)

1.4

(0.3)

3.7

240.0%

Pre-tax profit

(1.2)

0.9

1.1

(28.8)

6.0%

Net income

(1.2)

0.9

0.9

3.8

307%

EPS (€)

(0.09)

0.07

0.07

0.28

299%

Source: JDC Group financial accounts

After the strong Q423, FY24 is off to a strong start as well, driven by new business activity and portfolio transfers to JDC’s Insurtech platform. Nevertheless, Q1 is usually the weakest growth quarter and Q4 the strongest, which is also expected this year. For FY24, JDC expects a return of real estate and financing business as well as more activity in the investing segment, which is mostly the result of the acquisition of Top Ten Group. This results in FY24 guidance of revenues of €205–220m (17% growth at the midpoint) and an EBITDA of €14.5–16.0m (7.2% margin).

Given a guided 17% growth at midpoint this year, FY25 should also see 17% top-line growth in order to meet the target of €246m in revenue that year.

JDC’s financial position is very solid. Where it used to have a net debt position it now has a net cash position of €7.0m. The recently refinanced bond of €19.4m, with a maturity to 2028 and coupon rate of 7.0%, is more than offset by the cash position of €26.4m. JDC has sold all of the shares it had bought through share buybacks to Provinzial (by H123 it had 687k shares). It now has 105k shares from the buyback program started in December. Savings bank-related insurers Provinzial and Versicherungskammer Bayern (VKB) are now 6% shareholders.

Adoption at Provinzial starts to accelerate

German savings bank-related insurers Provinzial and VKB, both 5%+ shareholders, as well as SparkassenVersicherung (SV) are starting to adopt JDC’s insurance platform. The onboarding of Provinzial, the first large savings bank-related insurer contract, seems to be accelerating, especially driven by the good adoption by the Cologne branch. By now, 85 savings banks from Provinzial are onboarded on JDC’s insurance platform. Onboarding of branches has also started at VKB and SV, but is progressing more slowly. VGH Versicherungen from the Niedersachsen region is another savings bank-related insurer that could join the JDC platform this year.

Cooperative bank-related insurance company R+V Versicherung is also expanding its roll-out of JDC’s platform. In 2024, it will expand the running project to 20 branches from four last year. With c 30m customers, this is also a very important client.

The savings bank-related insurers and cooperative bank related insurers are JDC’s most important key customer groups and should contribute c €18m in revenue this year including Finanzguru. JDC expects that these client groups could generate more than €300m in annual revenue once fully onboarded.

Top Ten will bring extra top-line growth

On 23 January 2023, JDC signed the purchase agreement to acquire Austrian Top Ten Group, adding another product and client group to its platform. With this acquisition, JDC is expanding its footprint in investment management, where it already had a small position, while gaining control over the technical platform required for this with Top Ten’s software solutions. This software platform can be integrated with JDC’s Insurtech systems.

Top Ten administers €2.0bn in investment portfolios for around 1,000 intermediaries in its network using its own software solutions, generating largely recurring revenues of >€20m and EBITDA of >€0.7m. The company has been consolidated since December 2023 and we have assumed €18m in turnover from this acquisition in FY24.

The acquisition brings significant cross-selling synergies potential, as JDC can offer existing customers further digital services in the asset management, liability umbrella solutions and label funds sectors and service Top Ten’s c 1,000 intermediaries with its Insurtech platform, and vice versa. The acquisition closed in December 2023 and JDC now also has a top 30 position within German wealth managers.

Small changes to FY24 estimates

Unlike FY23, FY24 is off to a very strong start in terms of new business activity and portfolio transfers. JDC expects a strong tailwind in 2024: in addition to strong growth in insurance, it expects a return of real estate and financing business as well as stronger new business in the investment sector.

This was already reflected in our expectations. Therefore we have only made slight adjustments to our FY24 estimates, foremost reflecting a somewhat lower comparison base, as the FY23 results were on the lower side of our estimates, and a lower profitability level of the Top Ten Group. Our new estimates are on the higher end of the guided range, with a revenue estimate of €212.9m (€205–220m) and an EBITDA estimate of €15.3m (€14.5–16.0m).

In the next few years, we expect an acceleration in revenue growth for the Advisortech activities, driven not only by key customers, but also by increased growth in the IFA business and Top Ten Group, as well as the joint ventures with Bain Capital/GWL and Gothaer gaining momentum. As a result, we believe the FY25 target of €246m revenues is realistic without further acquisitions. We now expect €250m turnover and EBITDA of €22.3m in FY25, 10% higher than our previous estimates, driven by operating leverage.

During the year, we would expect JDC Group to provide new mid-term targets.

Exhibit 2: Estimate changes

€m

FY23

FY24e old

FY24e new

Change

FY25e old

FY25e new

Change

Total revenue

171.7

215.6

212.9

-1.3%

244.7

250.0

2.2%

EBITDA

11.7

15.5

15.3

-1.0%

20.3

22.3

10.0%

EBIT

5.8

8.5

8.9

4.3%

12.9

15.5

20.3%

Pre-tax profit

3.8

6.7

6.8

1.8%

11.1

13.5

21.4%

Net income

3.8

5.4

5.1

-5.3%

8.9

10.1

13.5%

EPS (€)

0.28

0.39

0.37

-4.1%

0.65

0.74

13.7%

Source: JDC Group financial accounts, Edison Investment Research


Undemanding valuation compared to peers and on DCF

DCF

Our DCF analysis results in a value of €34.04 per share, virtually unchanged from €34.09/share in our last report published on 16 August 2023. This is the result of somewhat lower margin estimates on balance compared to our H123 estimates and a net cash position now, compared to a net debt position last year. The most important assumptions in our DCF model are:

We only consider organic revenue growth, although we expect JDC to remain active in M&A. We expect organic revenue growth to increase in the next few years post our explicit forecast period to 25%, as adoption of the platform by retail clients grows, before levelling off to a terminal growth rate of 2.5%.

We expect the EBITA margin to increase to 7.8% in 2025 from 1.9% in 2022, as JDC benefits from platform effects and operational leverage. After 2025, the EBITA margin should increase to 10%, driven by operational leverage.

An effective tax rate of 32%, based on the corporate tax rate in Germany, starting at a lower level as a result of JDC’s tax shield.

We use a beta of 1.5 to reflect the relatively low-risk IFA/advisory business, offset by more uncertain key client developments.

We set a risk-free rate and market equity risk premium of 3.0% and 5.0%, delivering a WACC of 9%.

We have excluded treasury shares from our calculations.

Peer valuation

Although we realise that a peer comparison is not easy given JDC’s diversified profile, we note that JDC trades at a 22.1% discount on FY25e EV/EBITDA compared to platform peers and a premium of 35.9% compared to financial brokers. Compared to our report in August last year, the premium at which JDC trades for one year ahead estimates compared to financial brokers increased by >20% percentage points (was 15.5%), while the discount to platform peers decreased slightly (was 24.6%). We see this as a sign that the market increasingly perceives JDC as a platform player.

Exhibit 3: Peer valuation

Market cap (local currency, m)

FY24e EV/sales (x)

FY25e EV/sales (x)

FY24e EV/EBITDA (x)

FY25e EV/EBITDA (x)

Aon

$64,340

5.3

4.9

15.9

14.9

Moneysupermarket.com

£1,173

2.6

2.4

8.3

7.5

Netfonds

€111

0.5

0.4

11.6

7.9

Average financial brokers

 

2.8

2.6

11.9

10.1

Goosehead

$1,584

5.1

3.8

18.8

13.2

Hypoport

€1,569

4.1

3.5

42.4

22.0

Average platforms

 

4.6

3.7

30.6

17.6

JDC Group

€301

1.4

1.2

19.8

13.7

Premium/(discount) financial brokers

 

-48.6%

-52.4%

65.9%

35.9%

Premium/(discount) to platform

 

-69.1%

-66.6%

-35.3%

-22.1%

Source: LSEG. Note: Priced at 4 April 2024.

Exhibit 4: Financial summary

€m

2021

2022

2023

2024e

2025e

Year end 31 December

IFRS

IFRS

IFRS

IFRS

IFRS

INCOME STATEMENT

Revenue

 

 

146.8

156.1

171.7

212.9

250.0

Cost of Sales

(105.1)

(108.3)

(118.8)

(151.3)

(177.7)

Gross Profit

41.7

47.8

52.9

61.6

72.2

EBITDA

 

 

8.4

9.0

11.7

15.3

22.3

Operating profit (before amort. and excepts.)

 

2.9

3.0

2.9

5.8

8.9

Amortisation of acquired intangibles

0.0

0.0

0.0

0.0

0.0

Exceptionals

0.0

0.0

0.0

0.0

0.0

Share-based payments

0.0

0.0

0.0

0.0

0.0

Reported operating profit

 

 

3.0

2.9

5.8

8.9

15.5

Net Interest

 

 

(1.6)

(1.5)

(2.0)

(2.0)

(2.0)

Joint ventures & associates (post tax)

0.0

(0.3)

0.0

0.0

0.0

Profit Before Tax (norm)

1.4

1.1

3.8

6.8

13.5

Profit Before Tax (reported)

1.4

1.1

3.8

6.8

13.5

Reported tax

(0.5)

(0.2)

0.1

(1.7)

(3.4)

Profit After Tax (norm)

0.9

0.9

3.8

5.1

10.1

Profit After Tax (reported)

0.9

0.9

3.8

5.1

10.1

Basic average number of shares outstanding (m)

13.7

13.7

13.7

13.7

13.7

Average Number of Shares Outstanding (m)

 

 

13.1

13.7

13.7

13.7

13.7

EPS (€)

 

 

0.07

0.07

0.28

0.37

0.74

EPS - normalised (€)

0.07

0.07

0.28

0.37

0.74

DPS (€)

0.00

0.00

0.00

0.00

0.00

Gross Margin (%)

28.4

30.6

30.8

28.9

28.9

EBITDA Margin (%)

5.7

5.7

6.8

7.2

8.9

Normalised Operating Margin (%)

2.0

1.9

3.4

4.2

6.2

BALANCE SHEET

Fixed Assets

 

 

 

78.0

74.5

87.4

97.4

109.9

Intangible Assets

66.4

64.1

69.2

76.7

86.0

Tangible Assets

5.6

4.9

8.7

11.2

14.3

Investments & other

6.0

5.6

9.5

9.5

9.5

Current Assets

 

 

 

43.7

38.5

54.5

56.6

60.5

Stocks

-

-

-

-

-

Debtors

19.2

17.6

24.5

30.3

35.6

Cash & cash equivalents

21.9

16.7

26.4

21.7

19.5

Other

2.6

4.2

3.7

4.6

5.4

Current Liabilities

 

 

 

36.9

32.7

39.2

46.2

52.5

Creditors

23.8

18.1

29.0

36.0

42.3

Tax and social security

-

-

-

-

-

Short term borrowings

1.0

0.0

0.0

0.0

0.0

Other

12.1

14.6

10.2

10.2

10.2

Long Term Liabilities

 

 

 

46.0

43.3

49.9

49.9

49.9

Long term borrowings

19.5

19.7

19.4

19.4

19.4

Other long term liabilities

26.5

23.6

30.5

30.5

30.5

Net Assets

 

 

 

38.8

37.0

52.8

57.9

68.0

Minority interests

-

-

-

-

-

Shareholders' equity

 

 

 

38.8

37.0

52.8

57.9

68.0

CASH FLOW

Operating Cash Flow

5.6

7.2

8.4

13.6

19.0

Working capital

9.3

0.4

9.6

0.2

0.2

Net operating cash flow

 

 

 

14.9

7.6

18.0

13.8

19.1

Capex

(2.1)

(3.2)

(13.3)

(16.4)

(19.3)

Acquisitions/disposals

(11.0)

0.0

0.0

0.0

0.0

Net interest

0.0

(6.4)

6.1

(2.0)

(2.0)

Equity financing

10.6

(3.2)

(1.2)

0.0

0.0

Dividends

0.0

0.0

0.0

0.0

0.0

Other

(2.2)

0.0

0.0

0.0

0.0

Net Cash Flow

10.2

(5.2)

9.7

(4.6)

(2.2)

Opening net debt/(cash)

 

 

 

(11.6)

(1.4)

3.0

(7.0)

(2.3)

FX

0.0

(1.6)

(0.3)

0.0

0.0

Closing net debt/(cash)

 

 

 

(1.4)

3.0

(7.0)

(2.3)

(0.1)

Source: JDC Group, Edison Investment Research

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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

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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.

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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.

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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.

London │ New York │ Frankfurt

20 Red Lion Street

London, WC1R 4PS

United Kingdom

London │ New York │ Frankfurt

20 Red Lion Street

London, WC1R 4PS

United Kingdom

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