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RNS Number : 1716F M Winkworth Plc 16 April 2025
M Winkworth Plc
("Winkworth" or the "Company" or the "Group")
Audited final results for the year to 31 December 2024
Notice of Investor Presentation
Notice of Annual General Meeting
M Winkworth plc, the leading franchisor of real estate agencies, is pleased to
announce its audited results for the year ended 31 December 2024.
Highlights for the year:
Financial performance in 2024 in line with management expectations.
• Revenues of £10.79 million up by 17% on 2023
(2023: £9.27 million).
• Profit before taxation up 10% to £2.36 million
(2023: £2.15 million).
• Strong balance sheet with year-end cash balance of
£4.09 million (2023: £4.55 million) and with no debt.
• Full year dividends of 12.3p per ordinary share
declared (2023: 11.7p per ordinary share), an increase of 5% on the prior
year.
• Three new offices opened in the year (2023: 4) and
five franchises resold to new operators.
• Franchised office network revenue up 12% at £64.7
million (2023: £57.8 million).
- Network sales
revenue up 18% to £32.7 million (2023: £27.6 million).
- Network lettings
revenue up 6% to £32.0 million (2023: £30.2 million).
• Sales revenues 51% of total revenues (2023: 48%).
Dominic Agace, CEO of the Company, commented: "While our lettings and
management made further good progress in 2024, the strong performance of the
sales market played to Winkworth's skills and advantage. Almost half of our
franchises and the vast majority of our London offices are now in the top
three slot by market share in their local area and our performance figures
continue to improve. Our portfolio management strategy is working well with
the new talent that we are attracting adding to the strength of our brand and
reputation."
Investor presentation
Dominic Agace, CEO, and Andrew Nicol, CFO, will present the final audited
results for the year to 31
December 2024 via the Investor Meet Company platform on 23 April 2025 at 11.00
am.
The presentation is open to all existing and potential shareholders who can
sign up and register to participate for free at:
https://www.investormeetcompany.com/m-winkworth-plc/register-investor
(https://url.avanan.click/v2/___https:/www.investormeetcompany.com/m-winkworth-plc/register-investor___.YXAxZTpzaG9yZWNhcDphOm86ZmM3ZTM4YzAyNzIxN2RiNTZkMzYxMjlmYWYwZGExMzY6NjpiZDgwOjlmOWUxMDQ0MmU1ZTU4OWJkMjNmYjZjZmJmZWFlZTM0YmE1ZjY5YjIyNDEwNmE5MmM3YjNhMjAyNmRkYjQ3YjM6cDpUOk4)
Investors who already follow Winkworth on the Investor Meet Company platform
will automatically be invited.
Notice of Annual General Meeting
The Company's Annual General Meeting ("AGM") will be held at The Lansdowne
Club, 9 Fitzmaurice Place, London, W1J 5JD on Thursday, 22 May 2025 at 10.30
am.
The Notice of AGM will be made available on the Company's website at:
www.winkworthplc.com.
Printed copies of the 2024 Annual Report and Accounts will be mailed to
shareholders shortly, together with the Company's Notice of AGM.
For further information please contact:
M Winkworth
Plc
Tel : 020 7355 0206
Dominic Agace (Chief Executive Officer)
Andrew Nicol (Chief Financial Officer)
Milbourne (Public
Relations)
Tel : 07921 881800
Charlotte McMullen
Shore Capital (NOMAD and Broker)
Tel : 020 7408 4050
David Coaten
Henry Willcocks
George Payne
About Winkworth
Winkworth is the leading London franchisor of residential real estate agencies
with a pre-eminent position in the mid to upper segments of the sales and
lettings markets. The franchise model allows entrepreneurial real estate
professionals to provide the highest standards of service under the banner of
a long-established brand name and to benefit from the support and promotion
that Winkworth offers.
Winkworth (TIDM: WINK) is admitted to trading on the AIM Market of the London
Stock Exchange.
For further information please visit: www.winkworthplc.com
(https://url.avanan.click/v2/___http:/www.winkworthplc.com___.YXAxZTpzaG9yZWNhcDphOm86ZmM3ZTM4YzAyNzIxN2RiNTZkMzYxMjlmYWYwZGExMzY6Njo4OGMyOjU3MjAyMmE0Nzk3NTExMTU0M2EwZTZhMzg3YTJmZmFhYzI4NzA0MjUzMGQ3ZWI3NjQyZDk4MjUxOTVmN2Y0Njk6cDpUOk4)
Chair's Statement
As this year we celebrate 190 years of Winkworth, I am very grateful for the
heritage of which I have been the steward for over half a century. With this
milestone in mind, I hope shareholders will appreciate a slightly different
Chair's report from normal as I reflect on what makes your Company successful,
and how the future bodes for us.
Apart from this long history, many franchisee family successes and histories
have been entwined with the Winkworth growth story, and it is so pleasing to
see these families grow with the Winkworth franchise and even in our
franchisor office. We are fortunate to have many longstanding members of the
Company.
Historically, Winkworth has always balanced instructions with buyers. We aim
not to take on more properties than we believe we can service and, to a
certain extent, that has meant that every time an office reached its
natural optimum turnover, the franchisee has been encouraged to open a new
office to service an adjacent popular area.
Winkworth has, therefore, almost always expanded organically, driven by market
share and product. The classic example of this is our St. John's Wood's
franchisee expanding into Maida Vale and West Hampstead, and now with plans to
launch into two neighbouring territories. The same has happened in Exeter,
expanding from there to Crediton and Tiverton, and now separating the central
office into St. Leonards and St. Thomas's in order to service these markets
better. Similarly our Putney franchisee, one of our longest-standing, has
added West Putney to the Southfields and main Putney offices, helping the team
to expand. Winkworth's growth is through people and market share.
We need products to service our buyers and franchisees tend to expand within
their local areas to gain products to sell, and we help that expansion. We
plan to keep a balance between not going after every single instruction in
each area with offering the best selection. This benefits vendors and also
attracts the most buyers.
These principles are evident in our achievements: £3.4 billion worth of
property sold last year; 175,000 registered applicants, a database of over
four million contacts; and more than four million visits to our website. Our
100 offices meet these varying needs with Central London having fewer
instructions per office than outer London or the country, and some areas in
the UK have a low turnover as residents in those areas tend to stay for
life.
I have always observed that estate agency is a business of scale. It is not
about having five properties to sell and 20 buyers, it is about having maybe
50 properties to sell that attract perhaps 500 buyers. The professionals
handling these properties have to work as teams and, to meet customers'
expectations, administrators are often as important as front-line
salespeople. Winkworth likes to please its customers and build the very
long-term relationships that help its expansion. The franchise model of
long-term proprietors is a well-suited system to this goal. As one of
our new franchisees commented to me: "Not only have I got my personal
business, but I have got yours as well".
Having said that, we have well-developed plans to meet future market changes
and challenges. We are spending substantial sums of money helping our
franchisees use a dashboard of tools that will be incredibly useful to the
high-volume offices without overwhelming the smaller ones.
Meanwhile rentals, when done well, need a special set of skills because if
that side of the business shrinks or becomes more difficult it can become
less profitable. It is, therefore, a case of growing efficiency and building
property legal skills to maintain profit levels.
A couple of years ago I was asked why we were not diving into the rental
market. My response was that while the lettings and management business will
always be important to Winkworth, rental portfolios remain fairly static and
do not rush to change. We would only look to buy in order to secure a growth
point into sales. In our opinion, sales agency has always offered greater
profitability and better reflects selling skills, and the public is attracted
to the best operators. Our rentals and management business has in the past
grown to up to 50% of Group turnover, but sales are now dominating and I am
sure that over the long-term there will be some shrinkage in rentals as the
trend of landlords exiting the business continues.
How would that affect Winkworth? There may be some impact on our business,
but we would expect it to be compensated by increased sales and growth of
market share as some competitors may have focused too much on rentals and
diluted their sales teams. It will be interesting to see how this plays out,
but Winkworth has seen many changes before and I believe we can trust in our
own dynamism to keep our business ahead of the curve.
Simon Agace
Non-Executive Chair
15 April 2025
CEO's Statement
As buyers sensed an end to the interest rate tightening cycle and the cost of
mortgages fell, in 2024 we saw buyers (21% ahead of 2023) and sellers (20%
ahead of 2023) brush aside previous electoral concerns both in the UK and
internationally and expedite home moves that had been delayed by the cost of
living crisis. A lifting of these uncertainties, combined with further market
share gains, resulted in Winkworth's sales agreed increasing by 23% on 2023.
In the second half of 2024, activity remained resilient despite the impact of
the UK Government's autumn statement and the subsequent introduction of new
tax measures such as the increase in national insurance. As over time higher
rates of stamp duty and reduced mortgage interest rate relief have
discouraged buy to let and speculative investors, the UK market has become
increasingly needs-based and more resilient to external uncertainty. Increased
costs of finance, high rental prices, changes to the taxation of pensions
and school fees, and the higher cost of living are all factors that add to
the motivation of both buyers and sellers to transact.
In 2024, our network sales revenue rose by 18% to £32.7m (2023: £27.6m).
London led the way with sales income up by 22% across the city as a whole and,
within that, Central London sales revenue increasing by 26%. Backed by our
marketing campaigns and state-of-the-art operations, I am delighted that the
hard work and professionalism of our franchisees led to Winkworth's market
share of new listings growing the fastest of the top five agencies in London,
while our market share of sales agreed ("SSTC") grew by more than any of the
other top ten agents in London¹.
In the lettings and management business, increasing costs for landlords
continued to see them exiting the sector, leading to a reduction in supply of
properties to let. With rents at record levels, we have seen affordability
ceilings reached and increasing trends in room sharing, with young
professionals choosing cheaper areas to rent or staying at home longer, and
the bank of mum and dad lending to make buying affordable. These developments
have led to a reduction in tenant demand, and in 2024 we saw a 5% decline in
tenants registered compared to 2023.
Despite this reduction in registrations and a flattening of rental prices, we
achieved lettings and management network revenue growth of 6% in 2024 to
£32.0m (2023: £30.2m). This was led by the country markets where we saw an
increase in revenues of 10%, driven by newer Winkworth businesses growing
rapidly and supported acquisitions bolstering
existing franchisee portfolios. The stickier property management revenue
grew by 10% year-on-year compared to overall letting revenue
excluding property management income which grew by 3% in 2024 to £16.4m
(2023: £15.9m).
In 2024, gross revenues of the franchised network of £64.7m were 12% higher
year-on-year (2023: £57.8m), with an almost equal split in income between
Sales and Letting and Management compared to a 48:52 revenue split in 2023.
Winkworth's revenues of £10.79m were 17% higher (2023: £9.27m) and profit
before taxation rose by 10% to £2.36m (2023: £2.15m). The Group's cash
position at year end stood at £4.09m (2023: £4.55m) with no debt. Dividends
of 12.3p per ordinary share were declared for the full year (2023: 11.7p per
share).
During the course of 2024, we opened three new offices and resold five
franchises to new operators. At the end of the period under review the Group
consisted of 100 offices. We ended the year with a strong pipeline of nine
potential resales and six new openings. In 2025, we have already opened two
new offices.
We are forging ahead with our plan to invest in our platform and bring on new
talent to position us as a top three agency in each local area we operate in
within London. We believe that this focus will ensure our franchisees are
profitable through the various cycles of the property market and well
positioned to continue to invest in their businesses. To this end, we
replaced our previously closed Clapham office with a new operator in 2024 and
resold our flagship Knightsbridge office. We are accelerating our onboarding
of talent and I believe that a new generation of operators will secure the
health of the network and its organic growth going forward. We will continue
to offer new options for good people to join Winkworth.
In 2024, our own-equity offices made significant progress, with revenue
increasing by 27%. With our help, the manager in Tooting moved to acquire
neighbouring franchises for his own account and our Tooting office was
temporarily impacted by the transition to a new team, affecting its
profitability. This new team is now fully integrated and, with stable
management across the own-equity offices, we expect to see strength in 2025 as
Tooting returns to form and the newer offices mature into profitability.
After intensive repositioning we would expect to see most of our own-equity
offices ranking as top three operators in 2025. Where we can find star
quality, we will continue to review new opportunities for this
initiative and, as offices hit maturity, consider reducing our equity
position to enable management to increase their own stakes or acquire the
business. This will enable us to recycle capital into new opportunities where
we can boost our franchise fee return and generate additional profits.
Elsewhere, our Development and Commercial Investments business broke even
last year but continues to face uncertain market conditions. Promising signs
are coming from our recently launched new homes business.
OUTLOOK
We see the rejuvenated sales market remaining firm in 2025 and into 2026, with
a needs-driven property market leading to greater activity and more properties
becoming available as households re-align their sights and adjust to higher
taxation and inflationary costs. We see a broadly balanced picture between
buyers and sellers in 2025 and so anticipate that price increases of around 3%
will be in line with the general rate of inflation. We expect activity to be
heightened in London as a return to the office motivates buyers to seek
properties there.
With the renters' rights bill coming into statute we envisage that some
landlords, already burdened with losing part of the mortgage interest tax
relief and higher costs of finance, will not wish to continue to hold their
investments. However, with affordability ceilings having in many cases been
reached, we do not expect further rapid rises in rents but rather a reversion
to these tracking wage inflation, as prospective tenants avoid entering the
market or change location to reduce their costs.
With these changes we see an opportunity to continue to grow our lettings
portfolios as landlords look for greater guidance in the face of tighter
regulation. With weaker repossession rights, the need for higher quality
tenants will mean that more private landlords will look to use agents.
Additionally, increased regulation will push more independent
letting agencies to exit the business, generating opportunities for our
supported acquisition programme which provides funding to franchisees that
wish to acquire portfolios to bolster their business.
Note¹: based on postcodes where Winkworth has listed a property - Source:
TwentyEA
Dominic Agace
Chief Executive Officer
15 April 2025
M WINKWORTH PLC
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
2024 2023
Notes £'000 £'000
CONTINUING OPERATIONS
Revenue 10,794 9,265
Cost of sales (1,666) (1,573)
GROSS PROFIT 9,128 7,692
Other operating income - 1
Administrative expenses (6,842) (5,848)
Negative goodwill - 252
OPERATING PROFIT 2,286 2,097
Finance costs (60) (39)
Finance income 138 88
PROFIT BEFORE TAXATION 2,364 2,146
Tax 4 (592) (467)
PROFIT AND TOTAL COMPREHENSIVE INCOME FOR THE YEAR 1,772 1,679
Profit and total comprehensive income attributable to:
Owners of the parent 1,756 1,668
Non-controlling interests 16 11
1,772
1,679
2024 2023
£ £
Earnings per share expressed in pence per share: 6
Basic 13.73 13.02
Diluted 13.33 13.00
2024
£
1,679
2023
£
Basic
13.73
13.02
Diluted
13.33
13.00
M WINKWORTH PLC
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
31 DECEMBER 2024
2024 2023
Notes £'000 £'000
ASSETS
NON-CURRENT ASSETS
Intangible assets 1,238 1,300
Property, plant and equipment 828 984
Prepaid assisted acquisitions support 822 607
Investments 7 63
Trade and other receivables 674 350
3,569 3,304
CURRENT ASSETS
Trade and other receivables 1,539 1,450
Tax receivable 26 -
Cash and cash equivalents 4,085 4,548
5,650 5,998
TOTAL ASSETS 9,219 9,302
EQUITY
SHAREHOLDERS' EQUITY
Called up share capital 65 65
Share premium 179 179
Retained earnings 6,603 6,396
TOTAL EQUITY 6,847 6,640
Non-controlling interests 16 -
TOTAL EQUITY 6,863 6,640
LIABILITIES
NON-CURRENT LIABILITIES
Trade and other payables 638 767
Deferred tax 163 181
801 948
CURRENT LIABILITIES
Trade and other payables 1,461 1,556
Corporation tax payable 94 158
1,555 1,714
TOTAL LIABILITIES 2,356 2,662
TOTAL EQUITY AND LIABILITIES 9,219 9,302
M WINKWORTH PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
Called up share Non-controlling
Retained Share Other Total
capital earnings premium reserves Total interests equity
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 January 2023 64 6,212 - 51 6,327 102 6,429
Changes in equity
Issue of share capital 1 - 179 - 180 - 180
NCI on acquisition of shares - (24) - - (24) (113) (137)
Dividends - (1,511) - - (1,511) - (1,511)
Total comprehensive income - 1,719 - (51) 1,668 11 1,679
Balance at 31 December 2023 65 6,396 179 - 6,640 - 6,640
Changes in equity
Dividends - (1,549) - - (1,549) - (1,549)
Total comprehensive income - 1,756 - - 1,756 16 1,772
Balance at 31 December 2024 65 6,603 179 - 6,847 16 6,863
M WINKWORTH PLC
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024
2024 2023
Notes £'000 £'000
Cash flows from operating activities
Profit before tax 2,364 2,146
Depreciation charges 568 531
Gain on disposal of fixed assets - (9)
Fair value change in fixed asset investments - (22)
Negative goodwill - (252)
60 39
(138)
(88)
Finance costs
2,854
2,345
Finance income
Increase in trade and other receivables (413) (269)
Increase/(decrease) in trade and other payables (56) 5
Cash generated from operations 2,385 2,081
Interest paid - (1)
Tax paid (700) (670)
Net cash from operating activities 1,685 1,410
Cash flows from investing activities
Purchase of intangible fixed assets (158) (229)
Purchase of tangible fixed assets (70) (35)
Sale of fixed asset investments 56 -
Payments for prepaid assisted acquisitions (330) (217)
Interest received 138 88
Net cash used in investing activities (364) (393)
Cash flows from financing activities
Payments of lease liabilities (175) (214)
Interest paid on lease liabilities (60) (38)
Purchase of non-controlling interest - (137)
Share issue - 180
Equity dividends paid (1,549) (1,511)
Net cash used in financing activities (1,784) (1,720)
Increase/(decrease) in cash and cash equivalents (463) (703)
Cash and cash equivalents at beginning of year 4,548 5,251
Cash and cash equivalents at end of year 4,085 4,548
WINKWORTH PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
1. STATUTORY INFORMATION
M Winkworth Plc is a public company, registered in England and Wales and
quoted on AIM. The Company's registered number and registered office address
can be found on the Company Information page of the Annual Report.
2. ACCOUNTING POLICIES
Basis of preparation
The financial statements have been prepared under the historical cost
convention, with the exception of financial instruments as set out below, and
in accordance with UK adopted International Accounting Standards. The
financial statements are presented in pound sterling, which is also the
company's functional currency. The following principal accounting policies
have been applied consistently in dealing with items which are considered
material in relation to the financial statements.
Going concern
The Directors have, at the time of approving the financial statements, a
reasonable expectation that the Group has adequate resources to continue in
operational existence for the foreseeable future. Thus, they continue to adopt
the going concern basis of accounting in preparing the accounts.
Revenue
Revenue represents the value of commissions and subscriptions due to the Group
under franchise agreements, together with the value of fees earned by its
subsidiary lettings business. Revenue in respect of commissions due on house
sales is recognised at the point of the relevant property sale having been
completed by the franchisee. Revenue in respect of commissions due on
lettings, property management and administration services is recognised in the
period to which the services relate. The Group earns a straight 8% by value on
all sales and lettings income generated by the franchisees.
In Tooting Estates Limited, Crystal Palace Estates Limited and Lumley 1
Limited, revenue in respect of commissions due on house sales is recognised on
completion. Revenue in respect of commissions due on lettings and property
management is recognised over the life of the rental agreement.
3. SEGMENTAL REPORTING
The board of directors, as the chief operating decision making body, review
financial information and make decisions about the Group's business and have
identified a single operating segment, that of estate agency and related
services and the franchising thereof.
The directors believe that there are two material revenue streams relevant to
estate agency franchising.
2024 2023
£'000 £'000
Revenue 2,695
Estate agency and lettings business 3,446
Commissions and subscriptions due to the group under
franchise agreement 7,348 6,570
10,794 9,265
4. TAXATION
Analysis of tax expense
2024 2023
£'000 £'000
Current tax:
Taxation 625 4611
Adjustment re previous years (15) -
Total current tax 610 461
Deferred tax (18) 6
Total tax expense in consolidated statement of profit or loss and other
comprehensive
592 467
Income
Factors affecting the tax expense
The tax assessed for the year is higher than the standard rate of corporation
tax in the UK. The difference is explained below:
2024 2023
£'000 £'000
Profit before income tax 2,364 2,146
Profit multiplied by the standard rate of corporation tax in the UK of 25% 591 505
(2023 - 23.521%)
Effects of:
Expense not deductible for tax purposes 17 9
Adjustment in respect of prior periods (15) -
Depreciation in excess of capital allowances 17 2
Income not taxable - (59)
Other movements (18) 5
Change in tax rate - 5
Tax expense 592 467
5. DIVIDENDS
2024 2023
£'000 £'000
Ordinary shares of 0.5p each 1,549 1,511
6. EARNINGS PER SHARE
Basic earnings per share is calculated by dividing the earnings attributable
to ordinary shareholders by the weighted average number of ordinary shares
outstanding during the period.
2024
Earnings Weighted average number of shares Per-share amount
£'000 '000 pence
Basic EPS
Earnings attributable to ordinary shareholders 1,772 12,909 13.73
Effect of dilutive securities - 387 -
Diluted EPS
Diluted earnings 1,772 13,296 13.33
2023
Earnings Weighted average number of shares Per-share amount
£'000 '000 pence
Basic EPS
Earnings attributable to ordinary shareholders 1,668 12,814 13.02
Effect of dilutive securities - 20 -
Diluted EPS
Diluted earnings 1,668 12,834 13.00
7. CALLED UP SHARE CAPITAL
2024
2023
Authorised: £'000 £'000
20,000,000 Ordinary shares of 0.5p 100 100
2024
2023
Issued and fully paid: £'000 £'000
12,908,792 Ordinary shares of 0.5p 65 65
8. RESERVES
Retained earnings are earnings retained by the Company not paid out in
dividends.
Share premium is the premium paid on shares purchased in the Company.
Other reserves are the fair value equity components recognised over the
vesting period of share-based payments.
9. POST BALANCE SHEET EVENTS
On 15 January 2025, M Winkworth Plc declared a dividend of 3.3p per share for
the fourth quarter of 2024.
On 9 April 2025, M Winkworth Plc declared a dividend of 3.3p per ordinary
share for the first quarter of 2025
10. FINANCIAL INFORMATION
The financial information contained within this announcement for the year
ended 31 December 2024 is derived from but does not comprise statutory
financial statements within the meaning of section 434 of the Companies Act
2006. Statutory accounts for the year ended 31 December 2023 have been filed
with the Registrar of Companies and those for the year ended 31 December 2024
will be filed following the Company's annual general meeting. The auditors'
reports on the statutory accounts for the years ended 31 December 2024 and 31
December 2023 are unqualified, do not draw attention to any matters by way of
emphasis, and do not contain any statements under section 498 of the Companies
Act 2006.
11. ANNUAL REPORT AND ACCOUNTS
Copies of the annual report and accounts for the year ended 31 December 2024
together with the notice of the Annual General Meeting to be held at The
Lansdowne Club, 9 Fitzmaurice Place, London W1J 5JD on 22 May 2025, will be
posted to shareholders shortly and will be available to view and download from
the Company's website at www.winkworthplc.com
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