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RNS Number : 6007Z KRM22 PLC 17 September 2025
KRM22 plc
("KRM22", the "Group" or the "Company")
UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2025
KRM22 plc (AIM: KRM.L), the technology and software investment company, with a
particular focus on risk management in capital markets, is pleased to announce
its unaudited interim results for the six months ended 30 June 2025 ("H1 2025"
or the "Period").
Highlights
Financial
· Annualised Recurring Revenue* ("ARR") of £7.2m at 30 June 2025 (H1
2024: £6.0m) - growth of 20%
o New contracted ARR in the period of £1.0m (H1 2024: £1.1m)
o Total ARR attributable to the relationship with Trading Technologies
International, Inc. ("TT") of £0.9m (H1 2024: £0.8m)
· Total revenue recognised of £3.6m (H1 2024: £3.3m) - growth of
10.6%
o Recurring revenue recognised of £3.4m (H1 2025: £2.9m) - growth of 15.4%
· Adjusted EBITDA profit** of £0.4m (H1 2024: profit of £0.3m)
· Loss before tax of £1.6m (H1 2024: loss before tax of £1.3m)
· Gross cash and cash equivalents at 30 June 2025 of £1.4m (FY 2024:
£1.0m)
Operational
· New contractual ARR in H1 2025 generated from four cross sales
opportunities to existing customers for the Limits Manager, Risk Manager and
Market Surveillance applications
· First sales of combined surveillance product offering via the TT
relationship
· KRM22 applications and Services team successfully handled increased
market volatility following changes to US economic policy announced in April
2025
· Amendments to the TT convertible loan to defer all interest payments
until June 2026
Post-Period Events
· Growth in ARR to £7.4 as at the date of this report at current FX
rates
* Annualised Recurring Revenue ("ARR") is the value of contracted
Software-as-a-Service (SaaS) revenue normalised to a one year period and
excludes one time fees.
** Adjusted EBITDA is the reported loss for the period, adjusted for recurring
non-monetary costs including depreciation, amortisation, unrealised foreign
exchange loss and share-based payment charges/(credit) and non-recurring
costs, both monetary and non-monetary, including Company reorganisation costs.
Commenting on the results, CEO of KRM22, Dan Carter, said:
"Another strong set of results for KRM22, with continued ARR growth and
positive adjusted EBITDA. This momentum is being driven by sustained demand
for Risk Manager and Limits Manager, with the majority of new ARR coming from
cross-selling, highlighting both the strength of our applications and the
quality of our service. Looking ahead, our pipeline remains robust as we
work towards a strong close to 2025."
This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is
disclosed in accordance with the Company's obligations under Article 17 of
MAR.
For further information please contact:
KRM22 plc
InvestorRelations@krm22.com
Dan Carter, CEO
Kim Suter, CFO
Cavendish Capital Markets Limited (Nominated Adviser and
Broker)
+44 (0)20 7220 0500
Stephen Keys / Isaac Hooper
Sunila de Silva (ECM)
About KRM22 plc
KRM22 is a closed-ended investment company which listed on AIM on 30 April
2018. The Company has been established with the objective of creating value
for its investors through the investment in, and subsequent growth and
development of, target companies in the technology and software sector, with a
focus on risk management in capital markets.
Through its investments and the Global Risk Platform, KRM22 helps capital
market companies reduce the cost and complexity of risk management. The
Global Risk Platform provides applications to help address firms' trading and
corporate risk challenges and to manage their entire enterprise risk profile.
Capital markets companies' partner with KRM22 to optimise risk management
systems and processes, improving profitability and expanding opportunities to
increase portfolio returns by leveraging risk as alpha.
KRM22 plc is listed on AIM and the Group is headquartered in London, with
offices in several of the world's major financial centres.
See more about KRM22 at www.krm22.com (http://www.krm22.com)
CEO'S REPORT
KRM22 has maintained strong momentum into 2025, building on our record
performance last year with continued growth in Annual Recurring Revenue
("ARR"). ARR reached £7.2m as of 30 June 2025 and, at the time of writing,
has since increased further to £7.4m. The first half of 2025 delivered
£1.0m in new ARR, representing one of our strongest starts to a year and
underlining the continued momentum in the business. Encouragingly, 86% of
this new ARR came from existing clients expanding into additional applications
beyond their initial services with us - clear evidence that our integrated
application strategy is gaining traction. Client churn continues to be
managed to an acceptable level, with £0.1m of churn in in H1 2025 and, as at
the date of this report, the total churn for the year-to-date has further
increased to £0.3m, primarily due to industry consolidation. We continue to
exercise disciplined cost control, positioning the business firmly on the path
towards cash flow positivity and sustainable profitability.
Revenue growth
KRM22 has continued the progress made in 2024 into H1 2025 with £1.0m in new
ARR, made up of £0.9m on new contracts and £0.1m of extensions to existing
contracts. The growth in ARR was primarily driven by sales of Risk Manager
(45%) and Limits Manager (32%), with the majority of these (86%) being sales
of new applications to existing clients as an extension to what they currently
have with KRM22. This growth validates our strategic vision to enable
integration of the Risk Manager and Limits Manager applications, which
together cover our Trading Risk offering. This enables firms to gain
complete control of their risk management processes technologically by syncing
live risk data with limits set on ISV trading applications and exchanges.
Clients that have seen the benefits of using our Limits Manager application
are now supplementing the audit trail workflows in Limits Manager with
real-time data via the Risk Manager application. Similarly, our Risk Manager
clients are now looking towards Limits Manager for the efficiency and audit
gains that can be realised.
Our Trading Risk applications are used primarily by Futures Commissions
Merchants ("FCMs") and, at the date of this report, we now have 19 FCMs
contracted with KRM22 Trading Risk applications. Limits Manager remains the
market leader and, with the integration to Risk Manager, we hope to see
continued demand in this area.
The delivery of the highest standards of service is critical to a SaaS
software firm such as ours. The changes in US economic policy announced in
April 2025 created immediate volatility in global capital markets. Our
applications and the services team proactively responded to the increased
activity from our customers with high service levels being maintained.
Proactive account management and high service levels ensure that customer
churn levels are managed to an acceptable level. We continue to monitor this
closely as we look to close out 2025 and beyond.
KRM22 Applications
In 2025, our focus has remained on strengthening core functionality in our
applications, advancing integration of the Limits Manager and Risk Manager,
and driving wider client adoption. Building on this foundation, we are now
looking at how our applications can be adopted by additional asset classes,
reflecting the significant opportunity in becoming a truly multi-asset
platform. As our application suite continues to mature, we are well
positioned to extend market coverage and deliver enhanced value to clients
across a wider spectrum of their risk management needs.
Risk Manager
Following the successful creation of Risk Manager over the past couple of
years, with initial sales of the enhanced application in 2024, the first half
of 2025 has focused on scaling client usage and strengthening the performance
of the application. There have been further client deployments that have
successfully gone live, supported by continued investment in core
functionality and data processing. In addition, we have delivered
significant user interface improvements, ensuring a seamless transition for
firms previously relying on our legacy At-Trade and Post-Trade Stress
applications. With a client-led roadmap in place, we are delivering features
that align closely with the day-to-day needs of risk managers across the
industry.
Limits Manager
As Limits Manager advances further through its growth phase, development has
remained focused on extending functionality and usability for risk teams and
execution services. We have introduced more powerful client portal features,
giving firms greater flexibility in how they grant access to their own end
clients. Enhancements to API connectivity and external data enrichment have
further strengthened audit trail capabilities, while automation features have
continued to evolve. We have also expanded integrations with additional ISVs
and exchanges via both APIs and file-based transfers, ensuring the application
continues to deliver greater efficiency and control at scale.
Integration of Limits Manager and Risk Manager
Support and momentum have strengthened behind the integration of Limits
Manager and Risk Manager, with more firms recognising the benefits of a
consolidated risk framework. In 2025 we enhanced the combined workflows,
enabling risk teams to assess key metrics from Risk Manager directly alongside
client-raised limit changes in Limits Manager. These changes, once approved,
are automatically recorded in the audit trail with full context which provides
a powerful real-time view into both the decision process and underlying
account standing. This level of transparency and control is proving
increasingly valuable to our clients.
Market Surveillance
Our Market Surveillance application has continued to evolve, both in breadth
and in strategic positioning. The alert library has grown further, now
surpassing 80 alert types. The development of the API, enabling clients to
consume surveillance results outside the KRM22 GUI, has unlocked even greater
value through our integration with Trading Technologies International, Inc.
("TT") own surveillance product offering. This combined solution, pairing
TT's AI/ML-driven model with KRM22's calibrated alerting, was released by TT
in late 2024 and has gained commercial traction in H1 2025. TT's integrated
surveillance product is already generating recurring and non-recurring
revenues for KRM22, and with TT actively marketing the application, we expect
this revenue stream to grow meaningfully through our revenue share model.
Outlook
We have continued to deliver strong progress in 2025 with £1.0m of new ARR
added in the first half of the year and, at the date of this report, ARR now
standing at £7.4m. The significant share of new ARR generated in H1 2025
from existing clients expanding into additional applications underpins our
belief of the cross selling opportunity at KRM22 and the increasing value
clients place on our integrated application suite. Limits Manager and Risk
Manager continue to grow in stature as market-leading applications, while our
partnership with TT is extending the reach of our joint best-in-class Market
Surveillance offering. With a significant market opportunity ahead,
especially across different asset classes, a growing footprint across both new
and existing clients, and disciplined execution, we remain confident in our
ability to build on this momentum to become a cash generative and profitable
business.
Dan Carter
CEO
16 September 2025
FINANCIAL REVIEW
Income statement
Total revenue
Total revenue reported in the period was £3.6m (H1 2024: £3.3m), an increase
of 9.1% compared with the prior period, with 93.1% (H1 2024: 89.1%) generated
from recurring customer contracts. Non-recurring revenue for the period was
£0.3m (H1 2024: £0.4m) and related principally to customer implementations,
proof of concept work and development services.
Recurring revenue
As at 30 June 2025, the Group had contracted Annualised Recurring Revenue
("ARR") of £7.2m (H1 2024: £6.0m), with new contracted ARR in the period of
£1.0m (H1 2024: £1.1m) and churn of £0.1m (H1 2024: £0.4m). As at the
date of this report, contracted ARR has further increased to £7.4m.
Gross profit
Gross profit for the period was £2.8m (H1 2024: £2.7m) with gross profit
margin for the period of 77.5% (H1 2024: 81.8%). The decrease in gross
profit margin was driven by additional external sales commission on new ARR
contracts in the period, and increased direct costs associated with the Risk
Manager application.
Adjusted EBITDA
Adjusted EBITDA is a key metric to consider in order to understand the
cash-profitability of the business due in particular to the non-cash items
that impact the Income Statement under IFRS accounting, such as non-cash
share-based costs.
Adjusted EBITDA for the period was a profit of £0.4m (H1 2024: profit of
£0.3m) and a reconciliation of adjusted EBITDA profit to operating loss is
detailed below.
H1 2025 H1 2024
£'m £'m
Adjusted EBITDA profit 0.4 0.3
Depreciation and amortisation (0.6) (0.8)
Unrealised foreign exchange loss (1.1) -
Share-based payment (charge)/credit - 0.1
Group reorganisation costs - (0.6)
Operating loss (1.3) (1.0)
Loss for the period
Reported operating loss for the period was £1.3m (H1 2024: loss of £1.0m)
and included £1.1m of unrealised foreign exchange losses driven by a 9%
movement in GBP:USD FX rates in the period.
Finance charges
The net finance expense for the period was £0.3m (H1 2024: £0.3m) and
related to accrued loan interest on the TT convertible loan.
Financial position
Assets
The cash balance at 30 June 2025 was £1.4m (31 December 2024: £1.0m).
Current assets at 30 June 2025 include trade and other receivables of £0.8m
(31 December 2024: £1.2m).
Liabilities
As at 30 June 2025, our principal liabilities were:
· £4.5m convertible loan owed to TT plus accrued interest of £1.0m.
· £0.4m (US$0.5m) deferred consideration for earn out payments for the
acquisition of Object+. The liability can be satisfied in either cash or
Company ordinary shares at the Company's discretion.
· £3.4m of deferred revenue; contracted and paid services that will be
released within one year.
Principal risks and uncertainties
The principal risks and uncertainties facing the Group remain broadly
consistent with the Principal Risks and Uncertainties reported in the Group's
31 December 2024 Annual Report and continue to be carefully monitored by the
Board.
Kim Suter
CFO
16 September 2025
Consolidated income statement and statement of comprehensive income
for the six months ended 30 June 2025
Note 6 months to 6 months to
30 June 2025 30 June 2024
(unaudited) (unaudited)
£'000 £'000
Revenue 4 3,641 3,293
Cost of sales (820) (574)
Gross profit 2,821 2,719
Other income - 73
Administrative expenses (4,143) (3,794)
Operating profit before interest, taxation, depreciation, amortisation, share
based payment and exceptional items ("Adjusted EBITDA")
355 333
Depreciation and amortisation (587) (836)
Unrealised foreign exchange loss (1,063) (8)
Share-based payment (charge)/credit (27) 92
Group reorganisation costs - (583)
Operating loss (1,322) (1,002)
Net finance charge (263) (262)
Loss before taxation (1,585) (1,264)
Taxation credit 5 40
Loss for the period (1,580) (1,224)
Loss for the period attributable to:
Equity shareholders of the parent (1,580) (1,224)
(1,580) (1,224)
Other comprehensive income
Item that may be reclassified subsequently to profit and loss
Exchange gain on translating foreign operations 1,469 12
Total comprehensive loss for the period (111) (1,212)
Total comprehensive loss for the period attributable to:
Equity shareholders of the parent (111) (1,212)
(111) (1,212)
Loss per ordinary share
Basic and diluted earnings per share 5 (4.4p) (3.4p)
All amounts relate to continuing activities.
Interim consolidated statement of financial position
at 30 June 2025
30 June 31 December
2025 2024
(unaudited) (audited)
£'000 £'000
Assets
Non-current assets
Goodwill 3,485 3,485
Other intangible assets 2,504 2,128
Property, plant and equipment 18 19
6,007 5,632
Current assets
Trade and other receivables 761 733
Cash and cash equivalents 1,361 1,035
2,122 1,768
Total assets 8,129 7,400
Current liabilities
Trade and other payables 4,738 4,218
Lease liabilities 233 249
Loans and borrowings 5,080 774
Derivative financial liability 209 209
10,260 5,450
Net current liabilities (8,138) (3,682)
Non-current liabilities
Loans and borrowings - 4,039
Deferred tax liability 68 145
68 4,184
Total liabilities 10,328 9,634
Net Assets (2,199) (2,234)
Equity
Share capital 3,610 3,596
Share premium reserve 20,842 20,737
Merger reserve (190) (190)
Convertible debt reserve 327 327
Foreign exchange reserve 1,210 (259)
Share-based payment reserve 2,750 2,723
Retained losses (30,748) (29,168)
Total equity (2,199) (2,234)
Interim consolidated statement of cash flows
for the six months ended 30 June 2025
6 months to 6 months to
30 June 2025 30 June 2024
(unaudited) (unaudited)
£'000 £'000
Cash flows from operating activities
Loss for the period (1,580) (1,224)
Adjustments for:
Tax credit (5) (40)
Net finance expense 263 262
Depreciation and amortisation 587 836
Unrealised foreign exchange loss 1,063 8
Equity-settled share-based payment charge/(credit) 27 (92)
355 (250)
Increase in trade and other receivables (28) (90)
Increase in trade and other payables 548 834
520 744
Net cash inflows used in operating activities 875 494
Cash flows from investing activities
Purchases of intangible assets (534) (624)
Purchases of property, plant and equipment (4) (9)
Net cash used in investing activities (538) (633)
Financing activities
Lease payments principal - (116)
Lease payments interest - (3)
Net cash used in financing activities - (119)
Net increase/(decrease) in cash and cash equivalents 337 (258)
Cash and cash equivalent at beginning of the period 1,035 886
Effect of foreign exchange rate changes (11) 1
Cash and cash equivalent at end of the period 1,361 629
Notes to the interim financial information
1. General information
KRM22 Plc (the "Company") is a public limited company incorporated in England
and Wales on 2 March 2018 under registration number 11231735. The address of
its registered office is 8(th) Floor, Capital House, 84 - 86 King William
Street, London, EC4N 7BL. The Company listed on the London Stock Exchange on
30 April 2018.
The principal activity the Company, and together with its subsidiaries (the
"Group"), is to develop and sell software-as-a-service ("SaaS") applications
which provide comprehensive solutions for corporate and trading risk
management.
The Board of Directors approved this interim report on 16 September 2025.
2. Basis of preparation and consolidation
These interim consolidated financial statements have been prepared using
accounting policies based on International Financial Reporting Standards (IFRS
and IFRIC Interpretations) issued by the International Accounting Standards
Board ("IASB") in conformity with the requirements of the Companies Act
2006. They do not include all disclosures that would otherwise be required
in a complete set of financial statements and should be read in conjunction
with the 31 December 2024 Annual Report. The financial information for the
half years ended 30 June 2025 and 30 June 2024 does not constitute statutory
accounts within the meaning of Section 434 (3) of the Companies Act 2006 and
both periods are unaudited.
The annual financial statements of KRM22 Plc (the "Group") are prepared in
accordance with IFRS. The statutory Annual Report and Financial Statements
for 2024 have been filed with the Registrar of Companies. The Independent
Auditors' Report on the Annual Report and Financial Statements for the year
ended 31 December 2024, which was unqualified, did draw attention to a
material uncertainty, being going concern and did not contain a statement
under 498(2) or 498(3) of the Companies Act 2006.
The Group has applied the same accounting policies and methods of computation
in its interim consolidated financial statements as in its 31 December 2024
annual financial statements, except for those that relate to new standards and
interpretations effective for the first time for periods beginning on (or
after) 1 January 2025 and will be adopted in the 2025 financial statements.
There are deemed to be no new and amended standards and/or interpretations
that will apply for the first time in the next annual financial statements
that are expected to have a material impact on the Group.
3. Going concern
These financial statements have been prepared on the going concern basis.
The Directors have reviewed KRM22's going concern position taking into account
of its current business activities, budgeted performance and the factors
likely to affect its future development, which are set out in this Annual
Report, and include KRM22's objectives, policies and processes for managing
its capital, its financial risk management objectives and its exposure to
credit and liquidity risks.
The Directors have undertaken a significant assessment of the cashflow
forecast covering a period of at least twelve months from the date of approval
of the financial statements. Cashflow forecasts have been prepared based on
a range of scenarios including, but not limited to, existing customer churn at
different churn rates, no new contracted sales revenue, delayed sales and a
combination of these different scenarios.
Having assessed the sensitivity analysis on cashflows, the key risks to KRM22
remaining a going concern and not being in breach of the financial covenants
associated with the TT Convertible Loan is existing customers paying on
payment terms and within 45 days of invoice, customer churn or up to 10%,
conversion of some of the sales opportunities that are currently at contract
negotiation stage and maintaining control of the cost base.
The time to close new customers and the value of each customer, which are
deemed individually as high value and low volume in nature, is key to the
forecast being achieved and KRM22 continuing to operate within its existing
facilities. However, even if the forecast is achieved, there remains a
material uncertainty around KRM22 operating within the financial covenants
associated with TT Convertible Loan. The TT Convertible Loan includes
financial covenants, reported at the end of each quarter, based on the Group's
financial performance. Failure to comply with a financial covenant will
result in an Event of Default which may result in TT withdrawing the TT
Convertible Loan with all accrued amounts becoming immediately due and payable
which would result in KRM22 becoming insolvent.
TT have previously been very supportive of KRM22 in amending the terms of the
TT Convertible Loan, as demonstrated by the revisions agreed in December 2024,
March 2025 and April 2025, to ensure that KRM22 did not breach the Cash
Covenants. Past practice provides no guarantee that TT would be amenable to
making future changes however KRM22 and TT are in early discussion on the
longer-term plans for the TT Convertible Loan, noting that the three year term
of the facility ends in June 2026. As part of these discussions, and where
there is a risk to the Cash Covenant, amendments could include, but are not
limited to, reducing the value of the Cash Covenant at each measurement date
so that KRM22's cash exceeds the minimum cash requirement on each measurement
date, conversion of the TT Convertible Loan or refinancing the TT Convertible
Loan with a new debt facility. If the TT Convertible Loan was not amended,
converted or a debt refinance is not completed, KRM22 would be obliged to seek
alternative resolution including implementing extensive cost reduction
measures, and in addition the Group is reliant upon the ability to raise
additional funds to ensure it could meet its future liabilities as they fall
due.
The Directors have concluded that the circumstances set forth above indicates
the existence of a material uncertainty that may cast significant doubt on
KRM22's ability to continue as a going concern. However, given KRM22's
forecast, visible sales pipeline, working capital needs and continued support
and open dialogue with TT, the Directors have considered it appropriate to
prepare the financial statements on a going concern basis and the financial
statements do not include the adjustments that would be required if KRM22 were
unable to continue as a going concern.
4. Revenue (and segmental reporting)
The Board of Directors, as the chief operating decision maker in accordance
with IFRS 8 Operating Segments, has determined that KRM22 have identified two
areas of risk management as operating segments, together with a third segment
where the two areas of risk management are not easily separable, however for
reporting purposes into a single global business unit and operates as a single
operating segment, as the nature of services delivered are common.
The Directors consider that the business has two areas of risk management:
Trading Risk and Corporate Risk. Within these segments, there are two revenue
streams with different characteristics, which are generated from the same
assets and cost base.
6 months to 6 months to
30 June 2025 30 June 2024
(unaudited) (unaudited)
£'000 £'000
Recurring 3,388 2,935
Non-recurring revenue 253 358
Total 3,641 3,293
KRM22's revenue from external customers by geography and risk domain is
detailed below:
6 months to 6 months to
30 June 2025 30 June 2024
(unaudited) (unaudited)
£'000 £'000
UK 1,330 1,127
Europe 343 346
USA 1,775 1,654
Rest of world 193 166
Total 3,641 3,293
6 months to 6 months to
30 June 2025 30 June 2024
(unaudited) (unaudited)
£'000 £'000
Trading Risk 2,017 1,666
Corporate Risk 1,433 1,503
Multiple Risk 30 31
TT Platform 161 93
Total 3,641 3,293
5. Loss per share
Basic earnings per share is calculated by dividing the loss attributable to
the equity holders of KRM22 by the weighted average number of shares in issue
during the period.
KRM22 has dilutive ordinary shares, this being warrants and options granted to
employees. As KRM22 has incurred a loss in both periods, the diluted loss
per share is the same as the basic earnings per share as the loss has an
anti-dilutive effect.
6 months to 6 months to
30 June 2025 30 June 2024
(unaudited) (unaudited)
£'000 £'000
Loss for the period attributable to equity shareholders of the parent (1,580) (1,224)
Basic weighted average number of shares in issue 36,064,126 35,727,187
Diluted weighted average number of shares in issue 47,409,978 46,263,507
Basic and diluted loss per share (4.4p) (3.4p)
6. Intangibles
The Group capitalised £0.6m of costs (H1 2024: £0.6m, FY 2024: £1.1m)
representing the development of KRM22's applications during the period,
resulting in a net book value of £1.6m (H1 2024: £1.6m, FY 2024: £1.1m).
7. Cautionary statement
This document contains certain forward-looking statements relating to KRM22
plc (the "Group"). The Group considers any statements that are not
historical facts as "forward-looking statements". They relate to events and
trends that are subject to risk and uncertainty that may cause actual results
and the financial performance of the Group to differ materially from those
contained in any forward-looking statement. These statements are made by the
Directors in good faith based on information available to them and such
statements should be treated with caution due to the inherent uncertainties,
including both economic and business risk factors, underlying any such
forward-looking information.
Copies of this report and all other announcements made by KRM22 plc are
available on the Company's website at https://krm22.com/investors
(https://krm22.com/investors)
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