conwert Immobilien Buy (unchanged) Target: Euro 14.00 (unchanged) 26 Aug 15 Price (Euro) 11.31 52 weeks range 12.45 / 8.54 Key Data ISIN AT0000697750 Reuters CONW.VI Bloomberg CWI AV Reporting standard IFRS Market Cap (Euro million) 936.27 Number of shares (million) 82.8 Free Float 62.4% Free Float MarketCap (Euro million) 584 CAGR net profit ('13 -'16e) 0.0% Multiples 2014 2015e 2016e 2017e Market Cap/ revenues (gross) 2.5 2.5 2.3 2.1 Market Cap/ revenues (net) 3.6 3.3 3.1 2.8 PE-Ratio (not diluted) -78.0 17.1 14.3 12.3 Dividend Yield 1.1% 2.3% 3.3% 4.2% Price-to-Book-Ratio 0.90 0.84 0.81 0.79 Key Data per share (Euro) 2014 2015e 2016e 2017e Earnings per share (not diluted) -0.14 0.66 0.79 0.92 Dividend per share (DpS) 0.12 0.26 0.37 0.48 Book Value per Share (BVpS) 12.63 13.51 13.96 14.31 Financial Data (Euro '000) 2014 2015e 2016e 2017e Total revenues (gross) 381,200 374,400 409,800 450,700 Total revenues (net) 258,800 282,100 306,500 335,500 t/o rental income 237,300 254,900 276,100 301,200 t/o net profit from property sale 11,000 20,000 23,500 27,500 Net property services revenues 10,500 7,200 6,900 6,800 Property expenses -86,600-87,100-98,200-111,400 Net gains fair value adjustments 15,900 100 4,800 6,200 Operating profit (EBIT) 121,600 135,700 154,900 175,400 net financial result -131,500-50,600-48,500-45,500 Pre-tax profit (EBT) -9,900 85,100 106,400 129,900 IFRS taxation (mainly non-cash items) 1,000-24,800-29,400-36,700 Net profit after minorities -12,000 54,900 65,500 75,900 Shareholders' equity (Euro million) 1,045,250 1,118,600 1,155,900 1,184,800 Property assets (Euro million) 2,811 2,835 2,872 2,911 Total usable space (sqm '000) 2,473 2,502 2,551 2,610 RoE (pre-tax) -0.9% 7.9% 9.4% 11.1% RoE (after tax) -1.1% 5.1% 5.8% 6.5% Main Shareholders MountainPeak Traiding Ltd. 24.8% Petrus Advisers LLP 6.7% FIL Limited (Fidelity) 6.6% Earnest Partners, LLC 5.0% Treasury shares 1.8% Financial calendar SRC Forum Financials & Real Estate Sep 10, 2015 3Q 2015 report Nov 25, 2015 Annual results 2015 Mar 23, 2016 Analysts E-Mail Internet Thilo Gorlt, Exec. MBA (HSG), CIIA Dipl.-Kfm. Stefan Scharff, CREA Gorlt@src-research.de Scharff@src-research.de www.src-research.de www.aktienmarkt-international.de www.aktienmarkt-international.at Turnaround in first half 2015 due to improved profitability and lower financing costs Higher FFO guidance for the full year Buy affirmed Yesterday evening, conwert released its 1H 2015 report and hosted today a conference call to give more insight into the numbers and strategy. Due to a substantial improvement of its operating performance and lower financing costs the firm succeeded the turnaround with a strong hike in net profit. Rental income fell by more than 6% to Euro 113.5m, which was driven by property sales in the course of the portfolio streamlining. However, on a like-for-like basis rental income even increased by 1.3% overall, including rental income from commercial properties. As the management was able to significantly reduce operating expenses by 14% to almost Euro 28m, the net rental income was slightly above the previous year level at Euro 74.6m. At 8.9%, the vacancy rate has fallen below 9% for the first time (1H 2014: 10.2%). Total revenues surged by more than 29% to Euro 210m, which was mainly driven by the strong hike in property sales, whereat Euro 55m are accounted for by commercial property sold. Therefore, the portfolio streamlining program is well on track and the management confirmed its guidance to sell between Euro 150m - 200m of commercial properties in 2015. In addition to that, efficiency increased as personnel costs fell by more than 9% to Euro 13m as well as other operating expenses even declined by almost 18% to Euro 15m. As a result of all these measures, operating profit (EBIT) boosted by over 30% from Euro 47m to Euro 62m and marked the best operating result ever. The net financial result also significantly improved in the first half of the year by lower cash cost of debt. In addition to that a slightly higher interest rate landscape resulted in positive non-cash impacts in swaps. The net profit after minorities turned around to almost Euro +23m, after a loss of Euro -25m in the previous year period. The 1H 2015 figures confirmed us in our optimistic view that the company is able to realize the turn-around. Against the background of the improving numbers the management decided to lift the 2015 FFO I guidance from Euro 40m to 48m. We expect further improvements for the upcoming quarters concerning further declining vacancy rates, higher average rents and progress in the optimization of the financing structure. Therefore, we stick to our Buy recommendation and also confirm our target price of Euro 14.00. Keep in mind that the EPRA NAV per share climbed by 1% to Euro 15.82 in the first half of the year. With Dr. Beck a new experienced CEO will start his work from 1 September on.
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Strengths Weaknesses Opportunities Threats conwert's new strategy with a clear focus on major cities in interesting markets like Germany and Austria offers constant rental income. The company holds a very attractive residential portfolio in Austria and Germany with total property assets of Euro 2.67bn and was able to reduce its CEE portfolio in 2014 significantly. The management achieved significant reductions of the vacancy rates in Vienna and some major German cities and we strongly believe that conwert will achieve further improvements on that field. For the total portfolio conwert improved its vacancy rate in 1H 2015 to 8.9% (1H 2014: 10.2%) and was able to manage the turn-around from a net loss of Euro 25m in 1H 2014 to a net profit of Euro 23m in 1H 2015. Despite the problems with the properties in the CEE portfolio and the negative impact of the financial swaps, conwert reported for 1H 2015 an increase of the EPRA NAV per share from Euro 15.70 (year-end 2014) to Euro 15.82 which implies an upside potential for the stock of about 40%. Conwert is still in an active sales process for their commercial units and some properties in the CEE with relatively high vacancy rates. Therefore, we see a risk that the company could only reach relatively low prices for the above mentioned CEE objects. Due to a relatively high portion of financial swaps we see some risks for further negative financial results. conwert highly benefits from a quick and ongoing increase of the interest rate curve. In that scenario, the company will reach lower financial losses or even financial profits which will boost net profit in a positive direction. conwert showed in 1H 2015 some further significant cost reductions and we strongly believe that the management will outperform its guidelines for the following quarters of lower personnel costs as well as a significant reduction in other operating expenses. Management strictly follows the strategy of an optimization of the financing structure in order to lay the basement for a constant improvement of profits. Adler Immobilien AG acquired 100% of the voting rights and shares of MountainPeak Trading Limited and holds now a stake of 24.8% in conwert. It could be possible, that Adler will increase that stake, which could stimulate the stock price. Although we saw in 2014 some negative fair value adjustments for individual properties located in non-core countries, due to the tense situation in these markets and specific segments we cannot exclude financial strains for the future. A long-term low interest rate, called the "Japanese scenario", would lead to further financial losses for the company and therefore stress net profit. Ongoing difficult market situation, in particular for the projected sale of commercial units in CEE could induce negative cash flow effects. As a negative consequence, the firm can dissolve only a lower volume of financial swaps to unburden the negative financial result. 3 SRC Equity Research 3
Summary of the reported 1H 2015 figures Company succeeded the turnaround in 1H 2015 Yesterday, on 25 August, Austrian residential property player conwert Immobilien reported its figures for 1H 2015. The company was able to substantially improve its operative performance and significantly increase its net profit owing to higher operating profitability and lower financing costs as we already expected in our latest update from 28 May 2015. Highlights 1H 2015 (Euro million) 1H 2015 1H 2014 y-o-y Key performance indicators Rental income 113.5 121.2-6.4% Revenues from disposal of properties held for sale 26.2 24.3 7.8% Revenues from disposal of investment properties 66.3 12.0 452.5% Revenues from property services 3.7 4.5 Total revenue 209.7 162.0 29.4% EBITDA 59.2 54.9 7.8% EBIT 61.5 47.1 30.6% Finance costs -47.1-74.9-37.1% EBT 29.2-26.0 Net profit 23.0-25.0 FFO I 25.7 15.4 66.9% FFO II 29.0 18.7 55.1% Cash profit 25.7 16.1 59.6% Net rental income (NRI) 74.6 74.4 NRI margin 65.8% 61.4% Basic earnings per share ( ) 0.28-0.30 Balance sheet indicators Total assets 2,925.6 3,034.6-3.6% Non-current liabilities 1,306.8 1,607.7-18.7% Current liabilities 463.6 330.5 40.3% Total Equity 1,155.2 1,096.4 5.4% Equity ratio 39.5% 36.1% EPRA NAV (basic)/share ( ) 15.82 15.23 3.9% Property portfolio Rental units (No.) 29,896 31,451-4.9% Parking spaces (No.) 12,340 14,011-11.9% Total useable space (1,000 sqm) 2,363 2,561-7.7% Property assets ( m) 2,757 2,843-3.0% Total vacancy rate 8.9% 10.2% -12.7% Source: Company data, SRC Research Cost cutting measures pushed conwert s operational efficiency Property sales are the driver of the strong hike in total revenues For the first six months of the year, rental income dropped by more than 6% to almost Euro 114m. This was a consequence of further commercial property sales in the course of the portfolio streamlining as the company focus on residential property in metropolitan regions in Germany and Austria. On a like-forlike basis, however, rental income increased by 1.3% overall including rentals from commercial properties. Despite the drop in rental income, the implemented cost cutting measures improved significantly the operational efficiency of the company, which is also reflected by the strong hike of the NRI margin of 65.8% (1H 2014: 61.4%) and the net rental income of Euro 74.6m, that is even slightly above the previous year level (1H 2014: Euro 74.4m). According to conwert s portfolio strategy, the firm increased sales revenues by more than 150% from Euro 36m to almost Euro 93m, whereat about a volume of Euro 55m are accounted for by commercial property sold. The portfolio streamlining program implemented in March 2015 is well on track and the management confirmed again its target to sell between Euro 150-200m of commercial properties in 2015. Therefore, total revenues increased by more than 29% from Euro 162m to almost Euro 210m. 4 4 SRC Equity Research
Lower operating expenses stimulated the operating performance The improved finance result was another driver for the turnaround Another driver for the good operating performance was the vacancy rate, that stood at 8.9% after 10.2% in 1H 2014. Besides the strong increase in total revenues, the improvement of the operating performance in the first half of the year was also influenced by further cost cutting measures. Personnel costs dropped by 9% to Euro 12.5m, while other operational expenses decreased by almost 18% to Euro 15m. All in all, operating expenses were reduced by 14% to Euro 28m. Due to the positive top line development and realized cost cuttings, the operating profit (EBIT) increased by almost 31% to Euro 62m. In addition, the financial result improved significantly during the reporting period to Euro -32m after Euro -73m in 1H 2014 as the interest rate recovery resulted in a balanced effect of non-cash impacts. Furthermore, cash costs of debt dropped by more than 14% to almost Euro 32m (1H 2014: Euro 37m). This significant improvement led to a pre-tax profit of Euro 29m compared with a loss in 1H 2014 of Euro 26m. Key figures of the operating performance (Euro '000) 460,000 360,000 260,000 Turn around realized in 1H 2015 160,000 60,000-40,000 1Q 2014 1H 2014 9M 2014 FY 2014 1Q 2015 1H 2015-140,000 Total revenues EBIT Financial result Net profit/ loss Source: Company data, SRC Research According to the increased operating performance, the FFO I rose sharply by 67% to almost Euro 26m and the FFO II, which includes the sales income, stood for the first half of the year at Euro 29m after Euro 18.7m in the comparable period. Improved key figures and a slightly higher equity ratio in 1H 2015 In summary, conwert reported very sound figures that confirmed our optimistic view that the management with the new CEO Dr. Beck is able to bring the company back in black figures. Concerning the Loan-to-value target (LTV) for 2015 which is mentioned in a range of 50% to 55%, the management was able to reduce again that key figure to a value of 51.8% for the half of 2015 after a value of 53.6% at Dec 2014. What the balance sheet structure is concerned, equity ratio rose to a very comfortable value of 39.5% compared to 37.1% for the end of 2014, which corresponds to a book value per share of Euro 13.38. One of the main targets for the upcoming quarters is the ongoing optimization of the finance structure. In order to manage that target, management follows the strategy to spend the proceeds from commercial property sales for deduction of cash-flow hedges. According to the actual portfolio composition (Germany 74.6%, Austria 22.2% and other countries 3.2%), we feel confident that the management will reach its target to optimize the portfolio in the direction of 80% Germany and 20% Austria as well as 80% residential (actual: 75.2%) and only 20% commercial assets 5 5 SRC Equity Research
After a solid 1H result the management decided to lift FFO I guidance by 20% to Euro 48m We confirm our Buy rating and stick to our target price of Euro 14.00 (actual: 24.8%) until the beginning of 2016. Furthermore, management lifted up its FFO I guidance by 20% from Euro 40m to Euro 48m for 2015 mainly driven by NRI potential realization through a more efficient asset and property management and reduced interest expenses. Management realized the turnaround in 1H 2015, which was more or less in line with our expectations. Although, conwert s future profit development is mainly dependent on the further development of the interest curve, we feel very confident that the initiated measures will generate a much better earnings performance for the future. Thus, we confirm our Buy rating and also stick to our target price of Euro 14.00. 31/12 IFRS (Euro '000) 2011 2012 2013 2014 2015e 2016e 2017e CAGR '14 '17e Rental income 210,000 188,100 227,300 237,300 254,900 276,100 301,200 8.3% Proceeds from the disposal of properties held for sale (Trading Portfolio) 243,600 136,500 139,400 60,200 65,400 72,500 81,600 Expenses from the disposal of held for sale properties (Trading Portfolio) 203,400 112,300 117,700 48,500 49,100 51,900 58,200 Subtotal Trading Portfolio 40,200 24,200 21,700 11,700 16,300 20,600 23,400 sale margin (Trading Portfolio) 0 0 0 0 0 0 0 Proceeds from the disposal of investment properties (Hold Portfolio) 369,800 273,100 134,500 73,200 46,900 54,300 61,100 Expenses from the disposal of investment properties (Hold Portfolio) 360,900 262,900 128,900 73,900 43,200 51,400 57,000 Subtotal Hold Portfolio 8,900 10,200 5,600 700 3,700 2,900 4,100 sale margin (Hold Portfolio) 0 0 0 0 0 0 0 Revenues from property services 29,500 27,400 15,200 10,500 7,200 6,900 6,800 13.5% Total revenues 852,900 625,100 516,400 381,200 374,400 409,800 450,700 5.7% Property Expenses 90,900 77,600 85,900 86,600 87,100 98,200 111,400 Expenses from the disposal of held for sale properties (Trading Portfolio) 203,400 112,300 117,700 48,500 49,100 51,900 58,200 Expenses from the disposal of investment properties (Hold Portfolio) 360,900 262,900 128,900 73,900 43,200 51,400 57,000 Subtotal 197,700 172,300 183,900 172,200 195,000 208,300 224,100 9.2% Gains from fair value adjustments 87,700 64,600 68,100 73,100 1,700 21,200 33,100 Losses from Fair Value Adjustments (IAS 40) 79,900 91,900 59,000 57,200 1,600 16,400 26,900 Net gain / loss from fair value adjustments 7,800 27,300 9,100 15,900 100 4,800 6,200 26.9% Negative fair value adjustments to properties held for sale 7,500 9,900 2,600 2,900 0 1,100 0 Gains from the acquisition of a company below market value 0 0 0 0 0 0 0 Gain on bargain purchase 0 0 1,000 0 0 0 0 Impairment charge in connection with the acquisition of a company 0 0 0 0 0 0 0 Subtotal 0 0 1,000 0 0 0 0 Depreciation, amortisation and other impairment charges 5,300 118,500 1,000 1,200 900 300 200 Other operating income 9,100 6,100 10,200 5,200 3,800 3,200 2,800 Presonnel expenses 35,300 35,800 32,200 27,200 26,200 24,800 23,200 Other operating expenses 46,700 45,500 45,000 40,400 36,100 35,200 34,300 Earnings before interest and tax (EBIT) 119,800 58,600 123,400 121,600 135,700 154,900 175,400 13.0% Interest income on deposits with financial institutions 3,800 3,000 2,900 2,800 2,300 2,500 2,600 Interest income from derivatives 13,400 4,100 8,100 0 0 0 2,200 Income from the change in value of ineffective derivatives 2,200 0 28,700 3,800 1,900 13,500 25,500 Other finance revenue 100 500 1,700 300 500 700 900 Financial revenue 19,500 7,600 41,400 6,900 4,700 18,400 24,300 Interest expense on loands and overdrafts 64,200 55,700 57,100 Interest expense for derivatives 44,800 44,900 54,800 82,800 54,500 65,200 66,800 Expenses from the change in value of ineffective derivatives 4,600 3,400 4,400 54,500 2,800 3,200 4,400 Other finance costs 2,500 1,400 1,900 1,200 400 600 800 Finance costs 116,100 105,400 118,200 138,500 57,700 69,000 72,000 Share of profit from the associate 400 1,800 2,100 100 2,400 2,100 2,200 Financial results (Net Interest) 96,200 96,000 74,700 131,500 50,600 48,500 45,500 Earnings before tax (EBT) 23,600 154,600 48,700 9,900 85,100 106,400 129,900 Income tax expense 5,100 17,500 35,400 1,000 24,800 29,400 36,700 Tax rate 21.6% 11.3% 72.7% 10.1% 29.1% 27.6% 28.3% Profit / loss for the year 18,500 172,100 13,300 8,900 60,300 77,000 93,200 Thereof attributable to non controlling interests 4,800 4,300 5,800 3,100 5,400 11,500 17,300 Thereof attributable to equity holders of the parent 23,300 167,800 7,500 12,000 54,900 65,500 75,900 Stock exchange indicators Average number of shares (Basic) 82,779 81,496 82,855 82,783 82,783 82,783 82,783 Earnings per share (Basic) 0.28 2.06 0.09 0.14 0.66 0.79 0.92 Basic EPRA NAV/ share 18.35 15.79 15.40 15.70 15.96 16.08 16.26 Dividends per share (Euro) 0.20 0.00 0.10 0.12 0.26 0.37 0.48 Book Value per share (Euro, not diluted) 14.94 12.50 12.87 12.63 13.51 13.96 14.31 FFO I (Mio. ) 17,900 22,400 36,200 34,800 46,600 48,050 50,100 FFO II (Mio. ) 81,300 42,500 52,100 39,000 62,500 67,200 71,650 FFO I per share (Euro, not diluted) 0.22 0.27 0.44 0.42 0.56 0.58 0.61 FFO II per share (Euro, not diluted) 0.98 0.52 0.63 0.47 0.75 0.81 0.87 6 SRC Equity Research 6
31/12 IFRS (Euro '000) 2011 2012 2013 2014 2015e 2016e 2017e Assets A. Non current assets Investment properties 2,424.2 2,207.4 2,616.6 2,505.0 2,559.2 2,553.8 2,578.4 Goodwill 114.8 0.0 0.0 0.0 0.0 0.0 0.0 Intangible assets 3.7 1.3 2.1 3.1 3.4 3.5 3.5 Investments in associates 9.4 14.3 15.6 15.7 3.7 3.8 3.8 Miscellaneous property, plant and equipement 1.2 1.7 2.0 1.6 1.4 1.5 1.6 Other financial assets 4.7 4.9 7.8 4.6 3.9 4.5 5.1 Deferred tax assets 22.1 53.0 22.4 6.3 6.6 7.2 7.8 Total non current assets 2,580.1 2,282.6 2,666.5 2,536.3 2,578.2 2,574.3 2,600.2 B. Current Assets Properties held for sale 404.4 303.3 251.5 209.8 161.5 119.5 88.9 Trade accounts receivable 30.9 40.3 37.2 34.7 28.1 27.6 27.5 Other financial assets 59.4 99.7 71.3 15.9 29.2 33.5 36.2 Other assets 5.8 6.9 10.6 7.2 16.3 17.2 18.1 Cash and cash equivivalents 95.8 137.3 128.6 72.7 79.3 87.9 98.7 Assets held for sale 0.0 0.0 0.0 97.4 35.6 36.2 36.3 Total current assets 596.3 587.5 499.2 437.7 350.0 321.9 305.7 Total assets 3,176.4 2,870.1 3,165.7 2,974.0 2,928.2 2,896.2 2,905.9 Equity and liabilities C. Equity Issued capital 853.6 426.8 426.8 426.8 426.8 426.8 426.8 Share premium 328.5 595.6 592.3 591.2 595.3 595.3 595.3 Treasury shares 41.6 41.6 25.0 25.0 15.4 15.6 15.7 Retained earnings 203.0 165.4 174.0 156.0 194.1 228.9 254.6 Other reserves 106.9 127.8 101.5 103.7 82.2 79.5 76.2 Equity attributable to equity holders of the parent 1,236.6 1,018.4 1,066.6 1,045.3 1,118.6 1,155.9 1,184.8 Non controlling interests 11.8 6.6 62.0 59.3 60.4 61.2 62.5 Total equity 1,248.4 1,025.0 1,128.6 1,104.6 1,179.0 1,217.1 1,247.3 D. Non current liabilites Interest bearing loans and borrowings 1,005.9 921.1 1,081.6 1,120.4 965.0 905.6 875.6 Bond liabilities 0.0 64.6 64.7 64.8 64.8 64.8 64.7 Convertible bonds 273.8 223.1 205.2 174.6 75.3 75.3 75.3 Provisions 0.1 0.5 2.3 1.9 1.9 2.0 1.9 Deferred tax liabilities 22.7 34.4 46.5 51.1 59.3 63.1 67.8 Financing contributions from tenants 14.6 13.2 11.3 9.8 9.7 9.6 9.7 Other non current financial liabilities 148.2 183.4 120.7 157.9 99.1 82.4 81.5 Total non current liabilities 1,465.3 1,440.3 1,532.3 1,580.5 1,275.1 1,202.8 1,176.5 E. Current liabilities Current interest bearing loans and borrowings 408.9 308.0 378.0 221.3 301.3 301.5 305.9 Convertible bonds 0.0 22.1 0.0 99.5 99.5 99.5 Trade accouts payable 13.5 12.9 28.5 13.4 20.5 23.4 24.1 Provisions 2.2 3.3 4.1 3.6 3.5 3.6 Income tax payable 8.2 34.7 35.5 9.0 8.8 8.7 8.8 Other current financial liabilities 23.7 36.4 21.6 20.0 19.1 18.9 19.3 Other current liabilities 8.4 10.6 15.9 3.1 4.0 4.0 4.0 Liabilities held for sale 0.0 0.0 0.0 18.0 17.3 16.8 16.9 Total current liabilities 462.7 404.8 504.9 288.9 474.1 476.3 482.1 Total equity and liabilities 3,176.4 2,870.1 3,165.7 2,974.0 2,928.2 2,896.2 2,905.9 % Change 9.6% 10.3% 6.1% 1.5% 1.1% 0.3% Equity ratio 39.3% 35.7% 35.6% 37.1% 40.3% 42.0% 42.9% Book value per share (EUR) 14.9 12.5 12.9 12.6 13.5 14.0 14.3 7 SRC Equity Research 7
SRC Research - The Specialist for Financial and Real Estate Stocks - SRC - Scharff Research und Consulting GmbH Klingerstr. 23 D-60313 Frankfurt Germany Fon: +49 (0)69/ 400 313-79 Mail: gorlt@src-research.de Internet: www.src-research.de Rating Chronicle Date Rating former share price former target conwert 28/ May/ 15 Buy 12.29 14.00 conwert 16/ Apr/ 15 Buy 11.52 14.00 conwert 25/ Mar/ 15 Buy 11.81 14.00 conwert 6/ Mar/ 15 Buy 12.21 14.00 conwert 22/ Jan/ 13 Hold 9.75 10.50 Please note: The conwert share price mentioned in this report is from 25 August 2015. Conwert Immobilien mandated SRC Research for covering the conwert share. Disclaimer 2015: This equity research report is published by: SRC-Scharff Research und Consulting GmbH, Klingerstr. 23, D-60313 Frankfurt, Germany (short name: SRC Research). All rights reserved. Although we feel sure that all information in this SRC report originates from carefully selected sources with high credibility, we cannot give any guarantee for accuracy, trueness and completeness. All opinions quoted in this report give the current judgement of the author which is not necessarily the same opinion as SRC- Scharff Research und Consulting GmbH or another staff member. All the opinions and assessment made in this report may be changed without prior notice. Within the scope of German regulative framework the author and SRC-Scharff Research und Consulting GmbH do not assume any liability for this document or its content being used. This report is solely for information purposes and does not constitute a request or an invitation or a recommendation to buy or sell any stock that is mentioned here. Private clients should obtain personal advice at their bank or investment house and should keep in mind that prices and dividends of equities can rise and fall and that nobody can give a guarantee of the future development of equities. The author of this report and the SRC-Scharff Research und Consulting GmbH commit themselves on a unsolicited basis to having no long or short-positions in equities or derivatives related to equities mentioned in this report. Reproduction, distribution or publishing this report and its content as a whole or in parts is only allowed with approval of SRC management written form. With acceptance of this document you agree with all regulations mentioned here and all general terms and conditions you will find at anytime at our website www.src-research.de. 8 8 SRC Equity Research