Round Hill Music Royalty Fund — Expanding horizons

Round Hill Music Royalty Fund (LSE: RHM)

Currency in USD

Last close As at 04/02/2023

USD0.73

−0.03 (−3.95%)

Market capitalisation

USD317m

Research: Investment Companies

Round Hill Music Royalty Fund — Expanding horizons

Since its 13 November 2020 launch, Round Hill Music Royalty Fund’s (RHMRF) NAV has returned c 17.6% on a total return (TR) basis and 11.1% annualised (to end-May 2022 in US dollars), slightly above the targeted annualised NAV TR of 9–11%. An increase in economic NAV to $1.11/share (from $0.98 per share at launch; not an IFRS measure) and dividends contributed to the NAV TR. The RHMRF portfolio is valued using an 8.5% discount rate, still reasonably conservative despite rising interest rates. RHMRF benefits from the industry expertise of its fund manager Round Hill Music LP, a fully integrated business, in owning and exploiting music copyright assets. We believe RHMRF’s assets will continue to expand, providing reliable and growing revenues given the momentum in streaming and the potential of new distribution channels.

Fiona Orford-Williams

Written by

Fiona Orford-Williams

Director, TMT

Investment Companies

Round Hill Music Royalty Fund

Expanding horizons

Investment trusts
Special situations – music royalties

6 June 2022

Price

$1.06

Market cap

$430m

NAV*

$460m

NAV per share**

$1.11

Discount to NAV*

5.0%

*As at 31 December 2021.

Yield (prospective)

4.5%

Ordinary shares in issue

407.6m

Code/ISIN

RHM/GG00BMXNVC81

Primary exchange

LSE

AIC sector

Specialist – royalties

52-week high/low

$1.09

$1.00

NAV* high/low

$1.12

$0.98

**NAV as reported by the company at 29 April 2022.

Gross gearing***

13%

***As at 31 December 2021, defined as total reported debt to the latest reported economic NAV.

Fund objective

Round Hill Music Royalty Fund’s investment objective is to provide investors with an attractive level of regular and growing income and capital returns from investment primarily in high-quality music intellectual property. To achieve this objective, it seeks to invest in a songwriter’s copyright interest in a musical composition or song, together with the rights in the recording of these (known as the master recording rights), along with all other rights and assets considered relevant by the manager.

Bull points

Strong mix of professional music and finance experience in core investment team.

Relatively high predictability of returns.

Prospect of more favourable regulation.

Bear points

Competitive market for assets.

Risk of overpaying for assets.

Regulatory changes may or may not be beneficial.

Analysts

Fiona Orford-Williams

+44 (0)20 3077 5739

Victoria Chernykh

+44 (0)20 3077 5700

Max Hayes

+44 (0)20 3077 5700

Round Hill Music Royalty Fund is a research client of Edison Investment Research Limited

Since its 13 November 2020 launch, Round Hill Music Royalty Fund’s (RHMRF) NAV has returned c 17.6% on a total return (TR) basis and 11.1% annualised (to end-May 2022 in US dollars), slightly above the targeted annualised NAV TR of 9–11%. An increase in economic NAV to $1.11/share (from $0.98 per share at launch; not an IFRS measure) and dividends contributed to the NAV TR. The RHMRF portfolio is valued using an 8.5% discount rate, still reasonably conservative despite rising interest rates. RHMRF benefits from the industry expertise of its fund manager Round Hill Music LP, a fully integrated business, in owning and exploiting music copyright assets. We believe RHMRF’s assets will continue to expand, providing reliable and growing revenues given the momentum in streaming and the potential of new distribution channels.

RHMRF’s total return since launch to 31 May 2022 (%)

Source: Refinitiv, RHMRF. Note: SI (since inception) annualised.

Why invest in RHMRF now

FY22’s deal flow in music assets has perhaps been less frenetic than in H221, but there are still significant transactions going through and large, high-profile deals in the pipeline, which is unsurprising given the recent funding into the sector from both private equity and initial public offering (IPO) proceeds. However, pricing has yet to adapt fully to the changing interest rate environment. Both Universal Music Group and Warner Music reported strong Q122 progress, citing the bounce back in synchronisation revenues as a key revenue growth driver. Industry initiatives continue to aim to improve the transparency of revenue flows back to royalty owners, with uplifts to mechanical royalties also being negotiated, further supporting the attractions of high-quality portfolios, such as that managed by RHMRF, in revenue flow and intrinsic valuation.

The analyst’s view

In our view, RHMRF has compiled a strong portfolio of assets through its purchases of the Round Hill Fund One assets, an interest in the Carlin portfolio and further 2021–22 catalogue acquisitions. Noting rising valuations, we still regard the prices paid for the assets as appropriate for the underlying asset quality (see the valuations section on page 2), which is mature and well diversified by genre, with a slight bias towards rock. RHMRF’s revenues are set for strong growth, driven by the popularity of streaming, newer formats such as social media, gaming and fitness, and potential favourable regulatory changes (see our initiation report for details).

Fund profile: High-quality music royalties specialist

RHMRF listed on the London Stock Exchange on 13 November 2020, with the IPO raising $276.4m. It is the second UK-listed closed-end fund investing in music royalties (following Hipgnosis Song (SONG), listed in July 2018). Its NAV is $396.9m (as reported in the accounts on 31 December 2021) and the market capitalisation is $430.0m. The economic NAV (see the NAV reporting section below) is $459.7m based on the audited $1.12 economic NAV per share at 31 December 2021.

The company seeks to invest in music royalties with a proven track record and wide audience appeal. Exhibit 1 below summarises RHMRF’s catalogue acquisitions to date.

Exhibit 1: RHMRF’s acquisitions since launch

Date

RHM's name for the catalogue

Number of catalogues

Number of songs

Value*
$m

NPS multiple

Generated revenues prior to acquisition $m

1-Feb-21

Assets of Round Hill Fund One

38

>18,000

282

16.3x

>38m

4-May-21

29.14% minority investment in the RH Carlin portfolio

1

>100,000

c 40

16.2x

Undisclosed

11-Aug-21

Trevor Rabin

1

3,528

Undisclosed*

Undisclosed*

Undisclosed*

9-Sep-21

Dennis Elliott

1

71

Undisclosed*

Undisclosed*

Undisclosed*

15-Sep-21

Tim Palmer

1

30

Undisclosed*

Undisclosed*

Undisclosed*

28-Sep-21

O'Jays

1

532

Undisclosed*

Undisclosed*

Undisclosed*

2-Nov-21

Supertramp admin

1

39

Undisclosed*

Undisclosed*

Undisclosed*

29-Dec-21

Niko Moon (fractional interest)

1

29

Undisclosed*

Undisclosed*

Undisclosed*

31-Dec-21

Jack Richardson CM and Garth Richardson

1

308

Undisclosed*

Undisclosed*

Undisclosed*

31-Dec-21

Rebelution

1

N/A

Undisclosed*

Undisclosed*

Undisclosed*

31-Dec-21

Portfolio

49

>122,000

372**

16.3x

c 27.2***

5-Jan-22

Nancy Wilson

1

N/A

Undisclosed*

Undisclosed*

Undisclosed*

14-Jan-22

David Coverdale

1

N/A

Undisclosed*

Undisclosed*

Undisclosed*

8-Feb-22

Alice In Chains

1

253

Undisclosed*

Undisclosed*

Undisclosed*

10-Feb-22

Acquisitions between 11 Aug 2021 and 8 Feb 2022

N/A

>5,600

178.2

17.9x

Undisclosed*

Source: RHMRF. Note: *Due to commercial sensitivities, the company is unable to disclose financial details for each acquisition as it occurs. However, on completion of the investment of proceeds from the C Share fundraise of $86.5m, together with the remaining undrawn balance of its existing revolving credit facility, the company will make further financial disclosure on the acquisitions. ** Fair value as at the annual report at 31 December 2021. ***Royalty income during FY21.

Further details of the investments are given below. It is worth noting that scale is of value in this industry. The more substantial the catalogue, the greater the bargaining power when it comes to negotiating licensing deals.

RHMRF targets an annualised TR to investors of 9–11% over the medium term, after fees and expenses. It also targets an annualised dividend payment of 4.5 cents per share, payable quarterly.

Valuations

We note that the net publisher’s share (NPS) multiples, at which RHMRF acquires catalogues, have increased over the life of the fund. While the seed portfolio multiples were 16.3x and 16.2x, the latest acquisitions’ portfolio average multiple has grown to 17.9x (see Exhibit 1).

According to RHM LP, active management is often not reflected in underlying multiples. It regards valuations of 16–20x NPS for high-quality, iconic, blue-chip, stabilised catalogues as attractive.

Conversion of C-shares

To finance the acquisitions, listed in the Exhibit 1, made between 11 August 2021 and 8 February 2022, the company has fully invested all the proceeds from its July 2021 $86.5m C share issue and had drawn down c $91.7m under its existing revolving credit facility (RCF), using c $178.2m in total, as announced on 11 February 2022.

Consequently, on 11 May the company announced the conversion of 77.5m C shares into new ordinary shares. The current total number of ordinary shares in issue with voting rights is 407.6m. No shares are held in treasury.

Gearing and RCF

Gearing represented by borrowing is allowed for up to 25% of economic NAV, calculated at the point of drawdown, in accordance with the prospectus. As at 31 December, 2021, debt to economic NAV was 15.5%.

On 30 December 2021, the company increased the capacity under the RCF from $82m to $110m. As at 31 December 2021, the company had $82m of cash on hand and circa $60m of debt outstanding. The company had complied (and continues to comply) with all covenant compliances as per the RCF with RHMRF. Gross gearing (defined as total reported debt to the latest reported economic NAV) was 13% as at 31 December 2021.

NAV reporting

On 6 May the company announced its economic NAV per share of $1.11 (as at 29 April 2022), down $0.01 from the $1.12 NAV per share audited value reported in RHMRF’s FY21 annual report ($1.07 audited economic NAV per share at 30 June 2021). Citrin Cooperman (incorporating Massarsky), an independent valuer, used an 8.5% discount rate (unchanged from the valuation on 30 June 2021). The movement in the economic NAVs between then and 29 April 2022 was affected by the following:

the payment of the final dividend of $0.015 per ordinary share on 9 March 2022.

the revaluation of the company’s ordinary share portfolio and C Shares portfolio by Massarsky as at 31 March 2022; and

ongoing revenue collections and expenses of the company.

As stated in the FY21 company’s report, RHMRF’s board believes an economic NAV provides a meaningful alternative performance measure. The directors note the values of catalogues owned directly by RHMRF are based on fair values produced by the portfolio independent valuer.

The company floated at $0.98 economic NAV per share. The IFRS NAV per share was $0.95 at 31 December 2021.

Team developments

As the company continues to expand, its number of employees has grown from 52 employees 18 months ago to nearly 70 today. RHM has also gone through some business transformation to support scale and position for future growth. This has included relocating the legal team from New York to Nashville, the global home of the music royalty business. Responsibility for digital revenues has migrated to the licensing team to give greater coherence and efficiency, while staffing for income tracking has also been boosted. RHM remains committed to its employees and staff retention, while ensuring it builds plans to help employees on their career path. The company has internal diversity, equity and inclusion (DEI) and ESG teams, drawn from employees across all levels and all departments, to feed input into management decisions. In addition, RHM has hired external ESG experts.

The company has a dedicated IT person, Ed Carnes, based in Nashville and there is also a dedicated human resources person – both new positions created during 2021 to support the larger organisation. Most of the employees are based in Nashville.

RHM is also heavily focused on recordings and neighbouring rights (these rights in 2015 represented zero percent exposure). At end FY21 neighbouring rights exposure was closer to 30%, according to the company. RHM does not disclose the proportion of the neighbouring rights in its reporting. The company added about 12 people in these areas over the last two years.

The group offers a full-service, active management of its catalogues. The market is complex and lacks transparency, with much of the revenue not finding its way to the entitled/intended beneficiaries. To achieve full functionality and optimal returns, it is vital to have an exhaustive and efficient repository of metadata. Round Hill (and others) are focused on getting the full entitlement from their portfolio, which means having a far better handle on the metadata. The data transformation piece, which includes data enhancement and enrichment, is being undertaken in-house, with additional staff brought in to cover the day-to-day activities while this process is ongoing.

Industry developments

Concerns about the subscription model in other forms of entertainment have not been carried through into music, with Spotify’s continued strength testament to the resilience of music streaming and hence the value inherent in music assets. Spotify’s monthly average user (MAU) count was up by 19% year-on-year in Q122 to 422m globally, translating to a revenue uplift of 24%.

Q122 results from both Warner Music (Q222 to end March) and Universal Music Group have highlighted the importance of synchronisation (sync) revenues in driving top-line growth, with the former reporting sync income up 28% and the latter +29% year-on-year at constant currency as commercial licensing continued its recovery. Sony’s music publishing revenues were up 25% year-on-year (with a strong currency tailwind), with streaming revenues ahead 36% and ‘other’, which includes licensing and merchandising income, up 15%. The upsurge in sync revenues may moderate if global advertising spending tempers over the year as economic concerns build.

The number of applications and platforms using music carries on rising, with further expansion opportunities into the metaverse accelerating. Twitch, Triller, Apple Fitness+, Roblox, TikTok, Singa, LiteBoxer and many others are creating a significant revenue stream, now that initial resistance and attempts to circumnavigate licensing responsibilities have been (mostly) sorted. TikTok has recently signed a licensing deal with Pro Music Rights covering rights to over 2.5m works.

The rapid expansion of content creation to refill the hoppers of the streaming and broadcast sectors has also started to come through in sync revenues from TV and film. There is also a burgeoning catalogue of music originally composed for the games industry but now finding a wider audience.

2021 was a bonanza year for music rights acquisitions/deals, with industry estimates suggesting that over $5bn changed hands, split roughly equally between corporate deals and sales by artists/songwriters, fuelled by an inflow of capital into the sector both from private equity and from the proceeds of IPOs. The pace slackened as 2022 has progressed after an initial flurry with the purchase of the Bowie catalogue by Warner Chappell Music for a reported $250m. However, the recent sale of Justin Timberlake’s catalogue to the Blackstone-backed Hipgnosis Song Fund (SONG) and the rumoured sale of Pink Floyd’s catalogue may signal a renewed spate of activity.

With the rise in interest rates (and the prospect of further rises to come), and the resurgence of inflation, asset pricing – and price expectations – is likely to have to adapt.

Portfolio

Acquisitions

Since 29 December 2021, the group has announced six acquisitions of music publishing catalogues, master royalty income, recorded music income, neighbouring rights and publishing rights (for definitions, please see our initiation report). These comprise:

Niko Moon (fractional interest but ‘significant share’ of publishing rights): 29 compositions from the US country and pop singer/songwriter, with the catalogue generating 84% of its revenues in the United States.

Jack Richardson CM and Garth Richardson (100% of producer royalties and neighbouring rights): 308 recordings mostly in the alternative metal genre, including hits by Alice Cooper, Chevelle, Bob Seger and Rage Against the Machine. Streaming accounts for 72% of revenues.

Rebelution (entire catalogue including master recordings, neighbouring rights and music publishing assets): this acquisition extends the portfolio to reggae, with a catalogue reaching back to 2007, with the band having sold over 0.5m albums over that time. Streaming is again the largest element of revenues, accounting for 73%, with publishing contributing another 18%.

Nancy Wilson (‘significant share’ of master artists royalties and administration rights on neighbouring rights) for American rock band Heart, which has sold over 35m records globally since its breakthrough hit in 1975. Streaming constitutes 35% of the associated revenues, with neighbouring rights accounting for 39% and sync 13%.

David Coverdale (music publishing, master rights and master rights royalties, plus a long-term administration agreement for the neighbouring rights): the catalogue includes recordings from Coverdale’s career as frontman for Whitesnake and as lead singer of Deep Purple from 1973–76. Streaming generates 23% of revenues, while music publishing contributes 39% and physical 17%.

Alice In Chains (‘significant majority’ share of publishing, masters and neighbouring rights): the catalogue of this American rock band comprises 94 compositions and 159 recordings, with revenues deriving 53% from masters, 38% from publishing and 9% from neighbouring rights. 75% of revenues are generated in the United States.

Current pipeline assets

In its investor presentation in May 2022, RHMRF disclosed close to $33m worth of current deal pipeline highlights. RHM LP has also seen significant deal flow emerge from within its existing catalogues (including the pipeline investments) and has a proprietary position on those deals.

Current portfolio positioning

RHMRF’s portfolio has 49 catalogues with over 122,000 songs (at end-December 2021). Exhibits 2 and 3 illustrate the portfolio is diversified by genre and revenue type as at 31 December 2021. ‘Older’ genre rock (45%) has the largest share, followed by pop (21%) and country (13%). Following the investment manager’s ‘high quality compositions’ approach to primarily acquire songs over 10 years old, more than 75% of all the songs in the portfolio are ‘vintage’, written before 2000. The bias to rock is deliberate, as the attractions cross a wider range of age groups and a wider range of geographies, with hits having a longer ‘shelf-life’. The portfolio is also diversified by revenue type and has over a quarter (27%) of the portfolio’s revenues in masters’ royalties, perceived by the company, as those with the most stable and higher-quality revenues of all highlighted revenue types (Exhibit 3).

Exhibit 2: Portfolio breakdown by genre*

Exhibit 3: Portfolio breakdown by revenue type*

Source: RHM. Note: *As at 31 December 2021.

Source: RHM. Note: *As at 31 December 2021.

Exhibit 2: Portfolio breakdown by genre*

Source: RHM. Note: *As at 31 December 2021.

Exhibit 3: Portfolio breakdown by revenue type*

Source: RHM. Note: *As at 31 December 2021.

Performance: Trading since 13 November 2020

RHMRF’s performance track record began on 13 November 2020, the first day of trading of the trust. RHMRF’s share price is shown in absolute terms in the left-hand chart and in relative terms in the right-hand chart of Exhibit 4, compared to the MSCI UK All Cap Index.

Exhibit 4: Investment trust performance to 31 May 2022

Share price total return performance

Price, NAV and benchmark total return performance (%)

Source: Refinitiv. Note: Three-, five- and SI (since inception) performance figures are annualised.

A comparison of RHMRF’s and SONG’s performance is presented in Exhibit 5.

Exhibit 5: Selected peer group as at 31 May 2022*

% unless stated

Market cap £m

NAV TR
1 year

NAV TR
3 year

NAV TR
5 year

Sl** of RHM

Prem/disc
(cum-fair)

Ongoing charge

Perf.
fee

Gross
gearing

Dividend
yield

Round Hill Music Royalty

430.0

17.6

17.6

(6.1)

2.4***

Yes

13

4.3

Hipgnosis Songs

1,706.6

(4.9)

41.2

1.5

(10.8)

1.8

Yes

29

4.7

Simple average (2 funds)

1,068.3

6.4

41.2

N/A

9.6

(8.5)

1.9

21

4.5

RHM rank in peer group

2

1

N/A

N/A

N/A

1

N/A

2

1

Source: Morningstar, Edison Investment Research. Note: *Performance based on cum-fair NAV. **Sl = since launch. ***From RHMRF’s KIID (key information document at October 2020), including outstanding fees. TR = total return in US dollars. Gross gearing is defined as total reported debt to the latest reported economic NAV.

RHMRF has the lower market capitalisation of the two funds. Both RHMRF’s and SONG’s track records are relatively short, with SONG launched on 11 July 2018, approaching its three-year anniversary. In performance terms, since launch RHMRF has outperformed SONG on an NAV TR basis, but we note the very short performance period of just over one year. It is typical for new funds to gain momentum over a year as they establish themselves, invest and begin harvesting IPO proceeds, as RHMRF has done. This period largely reflects the set-up stage for RHMRF, as it has now fully invested its IPO proceeds and geared up.

In terms of the premium/discount to NAV, we believe it is still too early to compare the two trusts, and the numbers in the premium/discount column in Exhibit 5 are indicative only. We note that SONG reported its latest economic (or operative) NAV per share ($1.7) on 30 September 2021, and RHMRF’s first post-launch reported economic NAV per share was $1.11 at 6 May 2022.

Dividends and dividend policy

RHMRF’s primary objective is to reward its investors with a stable income (it also aims for long-term growth of capital). On 9 March 2022, the board confirmed the 4.5% dividend yield target for the financial period to 31 December 2022. This is in line with RHM’s long-term annualised dividend yield target of 4.5%, by reference to the issue price of $1.0.

On 25 May 2022 the company has declared an interim dividend of $0.01125 per share for Q122, payable on 14 June 2022. The company has also declared and paid its initial interim dividend for FY22, totalling $0.015 per ordinary share. This dividend comprises $0.01125 per ordinary share for the quarter to 31 December 2021 together with a further dividend payment of $0.00375 being the balance payable for the initial quarterly dividend to 31 March 2021. This ensures that holders of ordinary shares receive the full 4.5% of the company's initial issue price of $1.00 for the period from admission to 31 December 2021.

The dividend policy is to pay dividends quarterly: declare dividends for the quarterly periods ending March, June, September and December and pay in June, September, December and March, respectively. Dividends are aimed to be paid out of royalties income, but can be paid out of capital, if necessary, within the dividend policy.


General disclaimer and copyright

This report has been commissioned by Round Hill Music Royalty Fund and prepared and issued by Edison, in consideration of a fee payable by Round Hill Music Royalty Fund. 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

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 Round Hill Music Royalty Fund and prepared and issued by Edison, in consideration of a fee payable by Round Hill Music Royalty Fund. 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

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

More on Round Hill Music Royalty Fund

View All
concert stage on rock festival, music instruments silhouettes

Investment Companies

Round Hill Music Royalty Fund — Strong royalty performance

Investment Companies

Round Hill Music Royalty Fund — Expanding horizons

Investment Companies

Round Hill Music Royalty Fund — The one-year anniversary

Latest from the Investment Companies sector

View All Investment Companies content

Research: TMT

Ensurge Micropower — Expecting to ship samples ‘shortly’

Ensurge Micropower’s CEO took the opportunity in the recent Q122 results presentation to brief investors on the status of the company’s programme to ship samples of its milliampere hour (mAh) scale solid-state lithium microbatteries to customers. The company expects to deliver samples to its customers ‘shortly’. This is discussed in the body of this note. Ensurge already has agreements with five customers waiting for the samples.

Continue Reading

Subscribe to Edison

Get access to the very latest content matched to your personal investment style.

Sign up for free