1Spatial — Solid progress on several geospatial fronts

1Spatial (AIM: SPA)

Last close As at 17/07/2024

GBP0.69

0.00 (0.00%)

Market capitalisation

GBP77m

More on this equity

Research: TMT

1Spatial — Solid progress on several geospatial fronts

1Spatial’s (SPA’s) FY22 reported results surpassed our expectations. Revenues grew 10% to £27m with annualised recurring revenues up 26% (constant currency) to £13.4m, while SPA reported its first group profit before tax in over a decade. SPA’s results were driven by record contract wins across both new and existing customers, ongoing development of smart partnerships and expansion in the key US market. While it trades at a sizable discount to its software peers, we see opportunities to reduce the gap if it continues executing on its growth strategy.

Analyst avatar placeholder

Written by

TMT

1Spatial

Solid progress on several geospatial fronts

FY22 results

Software & comp services

28 April 2022

Price

38.9p

Market cap

£44m

Net cash (£m) at FY22 (January 2022)

3.2

Basic shares in issue (January 2022)

110.5m

Free float

79%

Code

SPA

Primary exchange

AIM

Secondary exchange

N/A

Share price performance

%

1m

3m

12m

Abs

14.9

(5.6)

(1.2)

Rel (local)

16.1

(3.1)

(4.8)

52-week high/low

53.5p

35.0p

Business description

1Spatial’s core technology validates, rectifies and enhances customers’ geospatial data. The combination of its software and advisory services reduces the need for costly manual checking and correcting of data.

Next events

H123 results

September 2022

Analysts

Ken Mestemacher, CFA

+44 (0)20 3077 5700

Dan Ridsdale

+44 (0)20 3077 5729

1Spatial is a research client of Edison Investment Research Limited

1Spatial’s (SPA’s) FY22 reported results surpassed our expectations. Revenues grew 10% to £27m with annualised recurring revenues up 26% (constant currency) to £13.4m, while SPA reported its first group profit before tax in over a decade. SPA’s results were driven by record contract wins across both new and existing customers, ongoing development of smart partnerships and expansion in the key US market. While it trades at a sizable discount to its software peers, we see opportunities to reduce the gap if it continues executing on its growth strategy.

Year end

Revenue (£m)

EBITDA*
(£m)

EBIT*
(
£m)

EPS*
(p)

P/Revenue
(x)

EV/EBITDA
(x)

P/E
(x)

01/21

24.6

3.6

0.4

0.2

1.8

11.3

224.1

01/22

27.0

4.2

1.3

0.8

1.6

9.8

50.3

01/23e

29.0

4.9

2.0

1.2

1.5

8.3

32.4

01/24e

31.2

5.7

2.7

2.3

1.4

7.2

16.9

Note: *EBITDA, EBIT and EPS exclude amortisation of acquired intangibles, exceptional items and share-based payments.

FY22: Contract wins drive recurring revenue

Over the past fiscal year, 1Spatial announced a number of significant, multi-year contracts wins in the UK, United States and Europe. Consequently, it delivered solid results in the first year of its three-year growth plan. Revenues were up 10% yoy (13% constant currency) to £27m and recurring revenue grew 15% to £12.2m. The strategic and growing US region’s revenues grew 37% y-o-y at constant currency while US/Ireland rose 18% y-o-y. EBITDA gained 15% y-o-y with margins up 70bps to 15.5%.

Raising FY23 and introducing FY24 estimates

We raise our FY23 estimates to reflect the higher-than-expected FY22 results and current momentum in contract wins. An increase in our forecasted revenue and EBITDA (by 11% and 14% respectively) lifts normalised EPS from 0.6p to 1.2p. Our new FY24 forecast is for sales to continue growing at 7.6% to £31.2m and EBITDA to reach £5.7m, driving normalised EPS to 2.3p.

Key catalysts to be watching for in FY23

Over the next year, we will be watching for several key catalysts that signal SPA’s strategic plan continues to bear fruit. First, we look for more states, cities and counties in the US signing up for SPA’s NextGen 911 solution. Second, we await the full launch of the cloud SaaS platform and resulting contract wins. Finally, we look for smart partnerships to continue generating multi-year, scalable contracts.

Valuation: Continuing to narrow the gap

1Spatial trades at 8.3x FY23e EV/EBITDA, a significant discount to its software peers, and a peer multiple of 16.5x implies a share price of 74p, about 91% above the current price. While much of the discount reflects SPA’s current lower growth, if the pace of contract wins is maintained and 1Spatial continues its US expansion as well as growth in recurring revenue, we expect there could be a reduction in this valuation gap.

What global turmoil? Delivering solid results in FY22

In spite of global turmoil from the COVID-19 pandemic, increasing inflation and Russia’s invasion of Ukraine, 1Spatial delivered solid results in FY22. In the first year of its three-year growth plan, SPA’s FY22’s revenues grew 10% (or 13% constant currency) y-o-y to £27m supported by recurring revenue rising 15% to £12.2m.

Annualised recurring revenues (ARR), a key measure of SPA’s transition to a SaaS business with a greater portion of recurring contract revenue, also grew 26% y-o-y to £13.4m, buoyed by term licences ARR up nearly 2.5 times to £4.1m from FY21’s £1.6m. Furthermore, recurring revenue as a percentage of total revenue increased to 45% versus FY21’s 43%.

As discussed in our recent outlook note, SPA’s results were driven by expanding business across the globe, with the strategic and growing US region’s revenues up 28% (37% constant currency) y-o-y to €3.7m and UK/Ireland increasing 18% y-o-y to £9.9m. Also, Europe’s revenues rose 2% y-o-y on a constant currency basis to £10.9m.

Adjusted EBITDA rose by 15% y-o-y to €4.2m, with margins up 70bps to 15.5%, driven by increased revenues and cost management. Notably, SPA reported its first group profit before tax in over a decade, with reported profit before tax at £0.2m, up from a loss of £1.2m in FY21. Net cash fell slightly to £3.2m from FY21’s £4.3m, mostly due to working capital investments related to new contracts.

Smart partnerships boost growth

1Spatial continued to enjoy solid growth in FY22 with multiple higher-value contract wins, boosting both revenues and ARR. Notable wins included an £8m multi-year contract won as part of a consortium for a department of the UK government to implement a digital transformation programme and a £6.5m contract with the UK government’s Geospatial Commission to support Atkins (project manager) in delivering the National Underground Asset Register.

A key factor behind many wins was SPA’s focus on developing ‘smart partnerships’, as many of its largest contacts were secured via partners, including Atkins, Landmark and Qinetiq, as well as partnerships being created with Esri, a global leader in the geographic information system (GIS) industry. As we discussed in our recent outlook note, one pillar of 1Spatial’s growth strategy is to collaborate with select partners in bidding on large contracts where its role is to be a data integrity provider. In management’s view, SPA’s reputation as ‘best in breed’ is why it was chosen to perform this key role, such as its two largest contracts in company, which were both won in collaboration with strategic partners.

SPA also enjoyed several customer expansion contracts, including the Department of Environment, Food and Rural Affairs (DEFRA) for supporting its Land Management System, with a five-year contract for £1.2m, a multi-year agreement with North Ireland’s Land and Property Services to support its digital transformation program and additional licences and services for Google Real Estate and Workplace services worth US$0.9m.

Exhibit 1 shows a visual of these wins from new and existing customers, including those done via smart partnerships.

Exhibit 1: New and expansion contract wins

Source: 1Spatial

It’s all about scaling up the US and Next Gen 911

A key factor in SPA’s ‘land and expand’ strategy is the expansion of its US business. It has implemented 1Integrate and 1Data Gateway products in several influential US states, including California and Michigan, and in FY22 secured contracts with four more US states (Montana, Georgia, Minnesota and Arizona) to deliver Next Generation 911 Emergency Services systems (NG 911). The NG 911 system incorporates SPA’s 1Integrate and 1DataGateway products and enables emergency entities across the state to upload and validate their location and 911 data to comply with Next Generation 9-1-1 Act requirements.

Each contract had an average ARR of US$0.15m and services of US$0.1m, further boosting SPA’s base of recurring revenue. Management expects total ARR across the United States to grow to over US$1m in FY23 and is adding sales staff to support the US growth.

As described in Exhibit 2, management estimates that the addressable NextGen 911 market alone would be worth more than US$100m, or about US$7.5m across the 50 states and US$100m across the 23k cities and counties.

In effect, the US market provides a significant, scalable growth opportunity for SPA, with 50 states and 23,000 counties and cities, each with potentially their own 911 emergency services, department of transportation and asset management teams, each of which relies on GIS information and would likely need a solution such as 1Integrate to check, validate and cleanse their data. Moreover, there are upsell opportunities in these states, such as highway performance monitoring, crash reporting, etc. Evidence of SPA taking advantage of the scalable opportunity is its growth from only one client in 2017 (US Census) to 23 by FY22, including two federal clients, 18 states and three counties.

Exhibit 2: The US Next Gen 911’s addressable market

Source: 1Spatial

Platform well aligned to meet demand for LMDM services

As Exhibit 3 portrays, SPA operates at the nexus of two large, growing markets: GIS and master data management (MDM), which management estimates to be worth US$10bn and US$12bn, respectively. The market where these two meet is the location master data management (LMDM) industry.

SPA’s platform is a set of software and components that includes its 1Integrate rules engine and 1Data Gateway self-service web portal, and allows clients to gather geospatial data from multiple sources and helps check, cleanse, validate, update and analyse the data, providing accurate location data that customers need. Moreover, its platform can be deployed as SaaS in the cloud, on-premise or as a hybrid across both.

As we explained in our outlook note, the LMDM industry is rapidly transforming with more companies using and generating more location data than ever before. Furthermore, the increasing number of companies undergoing digital transformations, numerous government infrastructure investments and the start of sustainability programs are driving the demand for tools to manage this data. After all, efficiently managing and using this data can be complex, costly and difficult, and 1Spatial’s platform seems well aligned to meet this growing demand for LMDM services and solutions.

To ensure that the platform remains what management considers best in class, SPA continues to focus on innovation. It was granted a UK patent for Modification and Validation of Spatial Data, thus protecting its rules engine technology, and SPA added support for 3D in a pilot project with a national mapping agency, automating the import of geospatial data into a 3D database and automatically validating that data with 1Integrate 3D. SPA launched its 1Spatial cloud platform to support its cloud solutions and continued enhancing its APIs so that customers can analyse their results using their own business intelligence tools. Finally, it developed several new, specific business apps such as 1Streetworks, and also apps that would enable SPA to offer validation-as-a-service (VaaS).

Exhibit 3: The LMDM market

Source: 1Spatial

Raising FY23 and introducing FY24 estimates

In our previous note on SPA’s FY22e trading update, we acknowledged that our forecasts may be conservative, given SPA’s record contract wins and sales momentum. Subsequently, SPA’s FY22 results surpassed both our revenue and EBITDA forecasts by £0.6m and £0.4m, respectively, as UK revenues were greater than we projected, though recurring term licence revenues were slightly less than we expected.

Given the trends discussed above and the solid FY22 results, we increase our FY23 revenue estimates from £27.5m to £29.0m, while forecasted EBITDA rises about £0.6m to £4.9m. We also boost our normalised basic EPS projection from 0.6p to 1.2p. While we do see continued investments in R&D to support innovation in SPA’s LMDM platform, EBITDA margins should still grow by 140bps, boosted by 7.3% sales growth in FY23e.

We also introduce FY24 forecasts, with revenues up 7.6% y-o-y to £31.2m, EBITDA up £0.8m y-o-y to £5.7m and normalised basic EPS of 2.3p versus FY23e’s 1.2p. Finally, we see net cash growing from £3.2m in FY23e to £3.5m FY24e.

Exhibit 4: Edison forecast changes

FY23e

FY24e

Old

New

Revenue (£m)

27.5

29.0

31.2

EBITDA (£m)

4.3

4.9

5.7

PBT, normalised (£m)

0.9

1.8

2.5

EPS, basic, normalised (p)

0.6

1.2

2.3

Source: Edison Investment Research

Valuation: Continuing to reduce discount to peer group

At the recent 38.9p price, SPA is trading at about 1.5x FY23e revenue, a significant discount to its software peers at 4.2x (see Exhibit 5). Some of the discount could reflect its lower projected growth (7% vs peers at 12%). As noted in Exhibit 6, it trades at an 8.3x FY23e EV/EBITDA, a 50% discount to its peers such as Hexagon and IQGeo.

Exhibit 5: Price/revenue multiples versus peers

Exhibit 6: EV/EBITDA multiples versus peers

Source: Refinitiv, Edison Investment Research, As of 26 April 2022

Source: Refinitiv, Edison Investment Research, As of 26 April 2022

Exhibit 5: Price/revenue multiples versus peers

Source: Refinitiv, Edison Investment Research, As of 26 April 2022

Exhibit 6: EV/EBITDA multiples versus peers

Source: Refinitiv, Edison Investment Research, As of 26 April 2022

If SPA maintains its pace of significant contract wins, continues its expansion in the United States with scalable opportunities in NextGen 911 and keeps growing its higher-margin SaaS revenue, we expect there could be a reduction in this valuation gap. Closing the revenue multiple could take time, although our forecast for growth in FY24e (7.6% versus 10.0% consensus for peers) may bode well for SPA’s efforts to begin reducing the disparity in growth.

Achieving an FY23e sector average price/revenue multiple of 4.2x would imply a share price of 109p, a 179% premium to the current price. Reaching a peer EV/EBITDA multiple of 16.5x suggests a share price of 74p, a 91% premium to the current price.

If SPA’s partnerships generate more wins than we expect and/or if US sales can ramp up faster than we project, then a further re-rating is possible.

Exhibit 7: Financial summary

£'000s

2020

2021

2022

2023e

2024e

Year ending 31 January

IFRS

IFRS

IFRS

IFRS

IFRS

PROFIT & LOSS

Revenue

 

 

23,385

24,600

27,027

29,000

31,200

Delivery costs

(11,123)

(11,451)

(13,078)

(14,094)

(15,101)

Gross Profit

12,262

13,149

13,949

14,906

16,099

EBITDA

 

 

3,226

3,632

4,182

4,906

5,699

Operating profit (before amort. and excepts.)

 

1,000

436

1,302

1,967

2,720

Goodwill and Acquired Intangible Amortisation

(972)

(917)

(561)

(600)

(600)

Exceptionals

(1,167)

(492)

-

-

-

Share based payments

(398)

(272)

(326)

(360)

(410)

Operating Profit

(1,537)

(1,245)

415

1,007

1,710

Net Interest

(195)

(187)

(195)

(186)

(186)

Other

-

-

-

-

-

Profit Before Tax (norm)

 

 

804

248

1,107

1,780

2,533

Profit Before Tax (FRS 3)

 

 

(1,733)

(1,433)

220

820

1,523

Tax

248

308

(43)

(205)

(381)

Profit After Tax (norm)

643

198

886

1,335

2,527

Profit After Tax (FRS 3)

(1,485)

(1,125)

177

615

1,142

Average Number of Shares Outstanding (m)

110

112

111

111

111

EPS - normalised (p)

 

 

0.58

0.18

0.80

1.21

2.29

EPS - normalised fully diluted (p)

 

 

0.58

0.17

0.77

1.21

2.29

EPS - (IFRS) (p)

 

 

(1.35)

(1.01)

0.16

0.56

1.03

Dividend per share (p)

-

-

-

-

-

Gross Margin (%)

52.4

53.5

51.6

51.4

51.6

EBITDA Margin (%)

13.8

14.8

15.5

16.9

18.3

Operating Margin (before GW and except.) (%)

4.3

1.8

4.8

6.8

8.7

BALANCE SHEET

Fixed Assets

 

 

19,206

18,273

17,100

17,850

18,600

Intangible Assets

15,560

15,187

15,003

15,753

16,503

Tangible Assets

374

392

350

350

350

Investments

3,272

2,694

1,747

1,747

1,747

Current Assets

 

 

14,985

18,332

18,018

19,235

21,253

Stocks

-

-

-

-

-

Debtors

9,644

10,890

12,271

13,200

14,200

Cash

5,108

7,278

5,623

5,911

6,929

Other

233

164

124

124

124

Current Liabilities

 

 

(12,844)

(14,813)

(14,903)

(15,469)

(16,219)

Creditors & other

(12,709)

(14,343)

(14,372)

(14,938)

(15,688)

Short term borrowings

(135)

(470)

(531)

(531)

(531)

Long Term Liabilities

 

 

(5,892)

(7,057)

(5,110)

(5,398)

(6,416)

Long term borrowings

(1,086)

(2,542)

(1,861)

(1,861)

(1,861)

Other long-term liabilities

(4,806)

(4,515)

(3,249)

(3,537)

(4,555)

Net Assets

 

 

15,455

14,735

15,105

16,218

17,218

CASH FLOW

Operating Cash Flow

 

 

572

3,983

2,497

4,543

5,449

Net Interest

(144)

(179)

(134)

(186)

(186)

Tax

313

484

176

(205)

(381)

Capex

(2,320)

(2,312)

(2,613)

(2,764)

(2,764)

Acquisitions/disposals

(2,151)

(585)

-

-

-

Financing

2,805

-

-

-

-

Dividends

-

-

-

-

-

Other

(254)

(1,069)

(1,088)

(1,100)

(1,100)

Net Cash Flow

(1,179)

322

(1,162)

288

1,018

Opening net debt/(cash)

 

 

(6,358)

(3,886)

(4,266)

(3,231)

(3,519)

HP finance leases initiated

(1,221)

-

-

-

-

Other

(72)

58

127

-

-

Closing net debt/(cash)

 

 

(3,886)

(4,266)

(3,231)

(3,519)

(4,537)

Source: 1Spatial, Edison Investment Research

General disclaimer and copyright

This report has been commissioned by 1Spatial and prepared and issued by Edison, in consideration of a fee payable by 1Spatial 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 1Spatial and prepared and issued by Edison, in consideration of a fee payable by 1Spatial 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 1Spatial

View All

Latest from the TMT sector

View All TMT content

Research: Industrials

Severfield — Strong H2 performance and order book growth

Severfield has overcome supply chain strains to deliver H2-weighted profitability in line with management’s expectations. Input cost inflation pass-through and order visibility cause us to raise our revenue expectations, leaving PBT and EPS estimates unchanged at this stage. Outlook confidence from orders on hand and pipeline comments is only latterly being reflected in share price performance.

Continue Reading

Subscribe to Edison

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

Sign up for free