Disclaimer Financial Analysis

(Only available in english language.)

Publisher: Raiffeisen Centrobank AG (hereinafter “RCB”)

RCB is a credit institution according to §1 of the Austrian Banking Act (Bankwesengesetz) with its registered office at 1010 Vienna, Tegetthoffstrasse 1, Austria.

Supervisory authorities: Austrian Financial Market Authority (FMA), 1090 Vienna, Otto-Wagner-Platz 5, Austria and Oesterreichische Nationalbank, 1090 Vienna, Otto-Wagner-Platz 3, Austria. Unless otherwise explicitly set out herein, references to legal acts refer to acts which have been enacted by the Republic of Austria.

This research report (hereinafter, “Report” or “Document”) is for information purposes only and may not be reproduced or distributed to other persons without RCB’s permission. This Document neither constitutes a solicitation of an offer nor is it a prospectus in the sense of the Austrian Capital Market Act (Kapitalmarktgesetz) or the Austrian Stock Exchange Act (Börsegesetz) or any other applicable law. Any investment decision in respect of securities, financial products or investments may only be made on the basis of (i) an approved and published prospectus or (ii) the complete documentation that will be or has been published in connection with the securities, financial products or investments in question, and must not be made on the basis of this Document.

This Document does not constitute a personal recommendation in the sense of the Austrian Securities Supervision Act (Wertpapieraufsichtsgesetz) to buy or sell financial instruments. Neither this Document nor any of its components shall form the basis for any kind of contract or commitment whatsoever. This Document is not a substitute for the necessary advice on the purchase or sale of securities, investments or other financial products. In respect of the sale or purchase of securities, investments or financial products, a banking advisor may provide individualised advice which might be suitable for investments and financial products.

This Document is fundamentally based on generally available information and not on any confidential information which the author that has prepared this Document has obtained exclusively on the basis of his/her client relationship with a third person.

Unless otherwise expressly stated in this Document, RCB deems all of the information included herein to be reliable, but does not make any warranties regarding its accuracy and completeness.

In emerging markets, there may be higher settlement and custody risk as compared to markets with an established infrastructure. The liquidity of stocks/financial instruments may be influenced by the number of market makers. Both of these circumstances may result in a higher risk in relation to the safety of the investments that will be, or may have been, made on the basis of the information contained in this Document.

This Report constitutes the current judgment of the analyst as of the date of this Report and is subject to change without notice. It may be outdated by future developments, without the Document being changed or amended.

Unless otherwise expressly stated herein, the analyst, that has drafted (or contributed to) this Report, is not compensated by RCB for specific investment banking transactions. Compensation of the analyst or analysts of this Report is based (among other things) on the overall profitability of RCB, which includes, inter alia, earnings from investment banking and other transactions of RCB. In general, RCB prohibits its analysts and persons contributing to the Report to acquire securities or other financial instruments of any company which is covered by the analysts (and contributing persons), unless such acquisition is authorised by RCB’s compliance department in advance.

RCB has established the following organisational and administrative agreements, including Chinese walls, to impede or prevent conflicts of interest in relation to recommendations: RCB has designated fundamentally binding confidentiality zones. Confidentiality zones are units within credit institutions, which are isolated from other units by organisational measures governing the exchange of information, because compliance-relevant information is continuously or temporarily processed in these zones. Compliance-relevant information must not leave a confidentiality zone and is to be treated as strictly confidential in internal business operations, including interaction with other units. This is not applicable to the transfer of information necessary for usual business operations. Such transfer of information is limited, however, to what is absolutely necessary (need-to-know principle). The exchange of compliance-relevant information between two confidentiality zones must only be conducted with the involvement of the compliance officer.

RCB may have effected a proprietary transaction in any investments mentioned herein or in related investments and or may have a position or holding in such investments as a result. RCB may have acted, or might be acting, as a manager or co-manager in a public offering of any securities mentioned in this Report or in any related security.

Risk Notifications and Explanations

Kindly note that research is done and recommendations are given only in respect of financial instruments which are not affected by the sanctions under EU regulation no 833/2014 as amended, i.e. financial instruments which have been issued before 1 August 2014.

We may remind you that the acquisition of financial instruments with a term exceeding 30 days issued after 31 July 2014 is prohibited under EU regulation no 833/2014 as amended. No opinion is given with respect to such prohibited financial instruments.

Figures on performance refer to the past. Past performance is not a reliable indicator for future results and developments of a financial instrument, a financial index or a securities service. This is particularly true in cases when the financial instrument, financial index or securities service has been offered for less than 12 months. In particular, this very short comparison period is not a reliable indicator for future results.

Performance of a financial instrument, a financial index or a securities service is reduced by commissions, fees and other charges, which depend on the individual circumstances of the investor.

The return on an investment can rise or fall due to exchange rate fluctuations.

Forecasts of future performance are based solely on estimates and assumptions. Actual future performance may deviate from the forecast. Consequently, forecasts are not a reliable indicator for future results and development of a financial instrument, a financial index or a securities service.

RCB's Rating and Risk Classification System

Risk ratings: indicators of potential price fluctuations are: low, medium, high.

Risk ratings take into account volatility. Fundamental criteria might lead to a change in the risk classification. The classification may also change over the course of time.

Investment rating: Investment ratings are based on expected total return within a 12-month period from the date of the initial rating.

  • Buy: Buy stocks are expected to have a total return of at least 10% (for low and medium volatility risk stocks; 15% for stocks with a high volatility risk) and are the most attractive stocks in the coverage universe of RCB in a 12 month horizon.
     
  • Hold: Hold stocks are expected to deliver a positive total return of up to 10% (for low and medium volatility risk stocks; 15% for stocks with a high volatility risk) within a 12-month period.
     
  • Reduce: Reduce stocks are expected to achieve a negative total return up to -10% within a 12-month period.
     
  • Sell: Sell stocks are expected to post a negative total return of more than -10% within a 12-month period.

Price targets are determined by the fair value derived from commonly used valuation methods (inter alia peer group comparison, DCF model and/or dividend discount). Other fundamental factors (M&A activities, capital markets transactions, share buybacks, sector sentiment etc.) are taken into account as well.

Upon the release of a Report, investment ratings are determined by the ranges described above. Interim deviations from the above mentioned ranges will not cause a change in the recommendation automatically but will become subject to review. Save as otherwise stated, the indicated prices are the closing prices of the relevant stock exchanges as available at 6.30 a.m. as of the date of this Report. Indicated prices refer to the stock exchange according to the Bloomberg/Reuters code stated.

Special Regulations for the United States of America:

This report and any recommendation (including any opinion, projection, forecast or estimate; hereinafter referred to as “Report” or “Document”) contained herein have been prepared by RCB (a non-US affiliate of RB International Markets (USA) LLC) or any of its affiliated companies and are distributed in the United States by RCB´s affiliate, RB International Markets (USA) LLC ("RBIM"), a broker-dealer registered with FINRA® and RCB. This Report constitutes the current judgment of the author as of the date of this Report and is subject to change without notice. RCB and/or its employees have no obligation to update, modify or amend or otherwise notify a recipient of this Report if the information or recommendation stated herein changes or subsequently becomes inaccurate. The frequency of subsequent reports, if any, remains in the discretion of the author and RCB.

This Report was prepared outside the United States by one or more analysts who may not have been subject to rules regarding the preparation of reports and the independence of research analysts comparable to those in effect in the United States. The analyst or analysts who prepared this research Report (i) are not registered or qualified as research analysts with the Financial Industry Regulatory Authority (“FINRA”) in the United States, and (ii) are not allowed to be associated persons of RBIM and are therefore not subject to FINRA regulations, including regulations related to the conduct or independence of research analysts.

RCB's Rating and Risk Classification System:

  • Buy: Buy stocks are expected to have a total return of at least 10% (for low and medium volatility risk stocks; 15% for stocks with a high volatility risk) and are the most attractive stocks in our coverage universe on a 12 month horizon.
     
  • Hold: Hold stocks are expected to deliver a positive total return of up to 10% (for low and medium volatility risk stocks; 15% for stocks with a high volatility risk) within a 12-month period.
     
  • Reduce: Reduce stocks are expected to achieve a negative total return up to -10% within a 12-month period.
     
  • Sell: Sell stocks are expected to post a negative total return of more than -10% within a 12-month period.

Price targets are determined by the fair value derived from commonly used valuation methods (inter alia peer group comparison, DCF model and/or dividend discount). Other fundamental factors (M&A activities, capital markets transactions, share buybacks, sector sentiment etc.) are taken into account as well. This Report does not constitute an offer to purchase or sell securities and neither shall this Report nor anything contained herein form the basis of, or be relied upon in connection with, any contract or commitment whatsoever.

The information contained herein is not a complete analysis of every material fact regarding the respective company, industry or security. This Report may contain forward-looking statements, which involve risks and uncertainties, does not guarantee future performances whatsoever and is, accordingly, subject to change. Though the information and opinions contained in this Report are based on sources believed to be reliable, neither RCB nor RBIM has independently verified the facts, assumptions and estimates contained in this report. Accordingly, no representation or warranty, expressed or implied, is made to, and reliance should not be placed on, the fairness, accuracy, completeness or correctness of the information and opinions contained in this Report. Although the opinions and estimates stated reflect the current judgment of RCB and RBIM, opinions and estimates are subject to change without notice. This Report is being furnished to you for informational purposes only and investors should consider this Report as only a single factor in making their investment decision. Investors must make their own determination of the appropriateness of an investment in any securities referred to in this Report based on the tax, or other considerations applicable to such investor and its own investment strategy.

Investment Risks

Investments in securities generally involve various and numerous risks and may even result in the complete loss of the invested capital. This Report does not take into account the investment objectives, financial situation or particular needs of any specific client of RBIM. Before making an investment decision on the basis of this Report, the recipients of this Report should consider whether this Report or any information contained herein are appropriate or suitable with regard to their own investment needs, objectives and suitability. Any recommendation contained in this Report may not be suitable for all investors. Past performance of securities and other financial instruments are not indicative of future performance. RBIM can be neither a price guarantor nor an insurer of market conditions.

This Report may cover numerous securities, some of which may not be qualified for sale in certain states and may therefore not be offered to investors in such states. This Document should not be construed as providing investment advice. Investing in non-U.S. securities, including ADRs, involves significant risks such as fluctuation of exchange rates that may have adverse effects on the value or price of income derived from the security. Securities of some foreign companies may be less liquid and prices more volatile than securities of U.S. companies. Securities of non-U.S. issuers may not be registered with or subject to Securities and Exchange Commission reporting requirements; therefore, information regarding such issuers may be limited. Securities which are not registered in the United States may not be offered or sold, directly or indirectly, within the United States or to U.S. persons (within the meaning of Regulation S under the Securities Act of 1933 [the ‘Securities Act’]), except pursuant to an exemption under the Securities Act.

This Report and the contents therein are the copyright product, and property of, RBIM or RCB. It is intended solely for those to whom RBIM directly distributes this Report. Any reproduction, republication dissemination, and/or other use of this Report by any recipient of it, or by any third party, without the express written consent of RBIM, is strictly prohibited.

U.S. persons receiving the research and wishing to effect any transactions in any security discussed in the Report should do so through RBIM, and not the issuer of the research. RBIM can be reached at 1177 Avenue of the Americas, 5th Floor, New York, NY 10036, 212-600-2588.

RCB is a stock corporation, incorporated under the laws of the Republic of Austria and registered in the companies register of the commercial court in Vienna, Austria. The principal executive office of RCB is at Tegetthoffstraße 1, 1010 Vienna, Austria. The shares of RCB are not listed on any stock exchange.

RCB strives to offer a wide spectrum of services and products associated with stock, derivatives, and equity capital transactions.

RCB's research department (non-cash generating unit) covers Austrian and Eastern European companies from the business fields: steel & materials, industry, banking, construction and building materials, IT & technology, oil & gas, real estate, telecommunications, utilities and cyclical and defensive consumer sectors. In addition, RCB covers a range of services to be provided in connection with mergers and acquisitions as well as privatisations.

Responsible supervisory authorities of RCB: Austrian Financial Market Authority (FMA), 1090 Vienna, Otto-Wagner-Platz 5, Austria and Oesterreichische Nationalbank, 1090 Vienna, Otto-Wagner-Platz 3, Austria.

RBIM's ultimate parent company is Raiffeisen Bank International AG ("RBI") (Vienna Stock Exchange; ticker RBI AV). RBI is a corporate investment bank and domiciled in Austria. For many years RBI has been operating in Central and Eastern Europe (CEE), where it maintains a network of subsidiary banks, leasing companies and numerous financial service providers in several markets. As a result of its position within Austria and CEE, RBI has an established course of dealing, stretching in some cases over many decades, with participants in the following industries: oil & gas, technology, utilities, real estate, telecommunications, financials, basic materials, cyclical and non-cyclical consumers, healthcare and industrials. Although RBI or its affiliated entities may have concluded transactions for products or services (including but not limited to investment banking services) with the subject company, or companies in the past 12 months, no employee of RBI or of its affiliates has the ability to influence the substance of the research reports prepared by the research analysts of RCB or RBIM.

RBIM is a broker-dealer registered with the SEC, FINRA and SIPC.

Special Regulations for the United Kingdom of Great Britain and Northern Ireland (UK):

This Document does neither constitute a public offer in the meaning of the Austrian Capital Market Act (Kapitalmarktgesetz; hereinafter, „KMG“) nor a prospectus in the meaning of the KMG or of the Austrian Stock Exchange Act (Börsegesetz). Furthermore this Document is not intended to recommend the purchase or the sale of securities or investments in the meaning of the Austrian Securities Supervision Act (Wertpapieraufsichtsgesetz). This Document does not replace the necessary advice concerning the purchase or the sale of securities or investments. For any advice concerning the purchase or the sale of securities of investments kindly contact RCB. Special regulations for the United Kingdom of Great Britain and Northern Ireland (UK): this Document has either been approved or issued by RCB in order to promote its investment business. RCB is supervised by the Austrian Financial Market Authority. This Document is not intended for investors who are Retail Customers within the meaning of the FCA rules and should therefore not be distributed to them. Neither the information nor the opinions expressed herein constitute or are to be construed as an offer or solicitation of an offer to buy (or sell) investments. RCB may have effected an Own Account Transaction within the meaning of FCA rules in any investment mentioned herein or related investments and or may have a position or holding in such investments as a result. RCB might have acted, or might be acting, as a manager or co-manager of a public offering of any securities mentioned in this Report or in any related security.

Information regarding the Principality of Liechtenstein:

COMMISSION DIRECTIVE 2003/125/EC of 22 December 2003 implementing Directive 2003/6/EC of the European Parliament and of the Council as regards the fair presentation of investment recommendations and the disclosure of conflicts of interest has been incorporated into national law in the Principality of Liechtenstein by the Finanzanalyse-Marktmissbrauchs-Verordnung.

If any term of this disclaimer is found to be illegal, invalid or unenforceable under any applicable law, such term shall, insofar as it is severable from the remaining terms, be deemed omitted from this disclaimer; it shall in no way affect the legality, validity or enforceability of the remaining Terms.

CONTACTS
Bernd Maurer
Head of Department
T: T: +43151520706
F: F: +431 51520 5706
E: maurer(at)rcb.at