Audioboom Group (LSE:BOOM) — 2024 Review

0:01 Good afternoon, ladies and gentlemen. Welcome to the AUDIOBOOM GROUP PLC investor presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged. They can be submitted at any time via the q and a tab that's just situated on the right hand corner of your screen. Please just simply type in your questions and press send. The company may not be in a position to answer every question it receives during the meeting itself. However, the company can review all questions submitted today, and we'll publish our responses where it's appropriate to do so.

0:29 Before we begin, as usual, we would just like to submit the following poll. And if you could give that your kind attention, I'm sure the company would be most grateful. I would now like to hand you over to the exec management team from AUDIOBOOM. Stuart, good afternoon, sir. Thank you, Jake. Hi, everyone. Good afternoon. It's it's really great to be here with you again. The last three months has flown by. It's always a good sign when time moves quickly. We've had a a great three months and I think a really great 2024, and it was fantastic to be able to bring you that trading update this morning to just give you some some more detail on the year. Obviously, we've been able to update you with some news across the the last few months, but to really bring you that full trading update this morning with some very positive news about AUDIOBOOM was pleasing. And I think today, we'll be able to give you some more color over the next forty five minutes about what we're doing at AUDIOBOOM and, in particular, what the next twelve months and beyond looks like. So usual format today for those of you who are familiar with us, we'll use the first section just to update anyone that's new to AUDIOBOOM with some background on the podcast market, the podcast industry, and our business model.

1:42 Then we'll review 2024 in in more detail. We will take a look ahead at the work that we're doing to make sure that that 2025 is a is a great year for us. And then there's a a q and a section at the end, so get your questions in. As Jake said, we'll answer as as many of those as as possible. But, yeah, that's what the next forty five minutes will will look like, and and and welcome. Really, I think the the the the key thing here today is to provide you some more detail. But first of all, you know, for anyone new to AUDIOBOOM, Brad and I will will introduce ourselves. My name is Stuart Lars. I'm the CEO of AUDIOBOOM, and I've been in this role for the the the past five years. But I have worked at AUDIOBOOM for for just over ten years now, launching the company in The US back in 2014.

2:38 And I'm based in in New York City, which is where the majority of our business is being done. I love the company. I think we have a great future ahead, and I'm pleased to be taking AUDIOBOOM forward. Hi, everyone. I'm Brad Clark, CFO at AUDIOBOOM. I'm based in London. I'm approaching seven years in the role now, having started in March 2018. I'm a chartered accountant, over sixteen years experience in financial roles focusing on on media companies. Those include Great Price in in UK and, of course, AUDIOBOOM. I'll be back a little bit later just to take you through a few financial slides on what was a very good year for the company. But for now, back to you, Stuart. Thank you, Brad. So always good when the executive summary has a a lot of bullet points on and and a lot of highlights for the year, I think. So just to walk you through those before we dive in in more detail, key parts of this trading update that that came out today was our our EBITDA performance. It was our fourth beat of of the adjusted EBITDA market expectation that got upgraded along the way, and it was pleasing to to to beat that by by more than 10% again today.

3:54 This business model is is strong, and I think probably the most important and the the one of the key points in that trading update was that we delivered more than 10% adjusted EBITDA margin in the final quarter. So that will start to show you how this business model can gear as as revenue grows for for the company. All of this we'll go into more detail on as we get through this presentation. Our revenue growth was ahead of the industry, so we're capturing market share. Our key ad product showcase, we've talked a lot about it in the past. We'll we'll take another look at that today. That that ad product is really is booming, growing quickly, contributing hugely to to our revenue and and gross margin. We'll highlight our industry leading monetization engine, record breaking KPI numbers, and I'll show those off to you today.

4:46 And then we'll look ahead at 2025, set up nicely key renewals, new signings of podcasts that will will drive revenue in 2025, money on the books, significant money on the books for for 2025 already. And I think just the the key point being that we expect 2025 to be a a record year for for the company. So lots to talk about. Lots of new information there, I think. And as I said before, the first section really is to give some background on the company and the industry to anyone that is new to BOOM. If you are new to AUDIOBOOM, welcome. Thanks for joining us. I hope this is a very useful presentation for you. First of all, let's look at that AUDIOBOOM business model. We are a a technology platform, a platform business that sits at the heart of of podcasting.

5:38 So what our platform does, and it does this at great scale very efficiently, is it connects three key elements. That those three key elements are the creators, the content podcast creators, the content that they make. It connects them with their audience and connects that content with advertisers. And bringing those three elements together creates value with our AUDIOBOOM in the middle, playing that role, the platform doing what it does. We cannot connect those three elements, and and the value is just not not there. So creators come to AudioBOOM. They use our technology to to publish their content and push that out to audiences. With one click of of a button, their content is pushed out to all of the key listening destinations or the key listening apps. So that's Spotify, Apple Podcasts, YouTube, Pandora, and many, many others. Wherever there is audience, we are distributing that content to audience.

6:37 And then we connect that content with advertisers. So we have an in house sales team, and we have a technology driven marketplace that's connecting all of that content, all of that audience with advertisers. We bring all that together, and we create some some pretty significant value in podcasting. And this model and this platform has a great history of delivering revenue growth. So you'll see here in the chart that over the past seven years, we've consistently grown this business from $6,100,000 of revenue back in 2017 to 73,400,000, as you know, for last year and a market expectation of of 80,000,000 for for next year. So that 38% CAGR over that time is is outpacing the industry. We've gained market share across that that that time, and we have proven that this model and this platform works well.

7:31 We we broke even, as many of you know, in 2021 and delivered adjusted EBITDA profitability in three of the the the past four years. So this is a good track record here. And, you know, while we can show here, I think that this model has delivered revenue growth in this time, we're now seeing, particularly with today's results, that this model will also deliver EBITDA gearing as we go forward. So that's obviously something to look out for. The other thing here to look out for is what the opportunity looks like by 2030. So the industry as a whole is projected to grow at 22% CAGR over that next five years. If AUDIOBOOM keeps pace with that industry growth, and bearing in mind, AUDIOBOOM has historically outpaced industry growth, if we simply keep pace with the industry growth between now and 2030, that would lead to revenue around $215,000,000 by by by 2030 and, obviously, the associated EBITDA profit that comes with that. So a great opportunity, I think, going forward for us.

8:33 Podcast is podcasting as an industry is booming. Audio boom is playing a major part in that boom. We are benefiting from the structural growth of podcasting around the world, and we do expect to to move forward at or above that that industry growth rate between now and 2030.

8:55 And that work that we've done, that growth that we've seen over the past seven years has propelled AUDIOBOOM to be a leader in this space. So this is the Triton Digital Podcast Ranker that measures the size of podcast networks in in The US. AUDIOBOOM recently moved up to be the fourth largest podcast publisher in in The US, which is, I think, a fantastic achievement given us and our independent nature and our, you know, a small team of of of 38 people. We really do do a fantastic job of competing with major companies like iHeartMedia, Wondery, which is owned by Amazon, NPR, which is the BBC of of America. So we do a fantastic job there. It's probably the part that I'm most proud of is our position, I think, in the in The US industry and the leading role that we are are establishing there. But not only are we the fourth largest publisher in The US, we have a global footprint.

9:49 So we're the second biggest publisher in The UK, fourth in Australia and Canada, second in New Zealand. We are in the top 10 in Latin America. So we're really creating a global business here, and we're improving our revenue sources, revenue streams in in, you know, in in all of those other countries too. So great growth here, great position as a leader in in this space, and I think this really highlights the the the work that we've done over the the past past ten years to to build this company.

10:24 So that's a quick look at the industry, our model, and and and our achievements. I think it's pretty important here that we quickly get into a review of 2024. You'll have seen from the trading update most of these numbers, but I'll go through them in a little more detail and and give you some color on a few of the areas. So I think the the first point that you'll have seen in that trading update was revenue for the year of $73,400,000. That's up 13% versus the the previous year, so some solid growth in that revenue number. Our growth for 2024 was 8% ahead of the IAB, which is in Interactive Advertising Bureau's projection for The US podcast industry. So we're growing faster than our competitors, faster than the industry, capturing market share, which I think is an important point there.

11:17 The advertising market is starting to return to good health after the headwinds of 2022 and 2023, and that obviously helped us achieve that that strong growth on the the revenue numbers in in 2024. I think worth saying here that, you know, the one negative point that we have for for 2024 is is how our revenue growth was limited by a change in the Apple Podcast Player, and that change limited our revenue performance by around $15,000,000.

11:47 So, look, 2024 could have been bigger, could have been better from a revenue perspective. That was a change that, you know, was industry wide and and out of our our hands, but it did limit that that revenue performance. So if there's one negative here, it is that that fades away over the the the coming months that that Apple limitation on on on revenue and get back to a a place where where we can push forward there again. But I think that having revenue growth ahead of the industry significantly is a is a great result for 2024. Adjusted EBITDA of $3,400,000, we we beat market expectations. The most recent market expectation was 3,100,000, so 10% above that most recent market expectation. But along the way, along the year, that market expectation was upgraded three times. Started at 1,200,000 back at the start of the year. And as we performed strongly across 2024, we we we beat that market expectation significantly along the way. So to continue to to upgrade that market expectation and then go ahead and beat it for one final time in today's training update, I think, is a great great result and, again, highlights the the strength of our business model as we return to to to profitability this year.

13:11 When we look specifically at q four of twenty twenty four, the numbers are also, again, very positive here. So $20,500,000 of revenue in the quarter, up 7% against the against q four of of twenty twenty three, and also our second highest ever quarter for revenue. So good performance. There's obviously seasonality in the business, and q four is a strong time for us. But just, again, fantastic to to see that revenue growth in in q four. It was our fifth successive quarter of year on year revenue growth after that ad market recession that that impacted our revenue back in in 2022 and early twenty twenty three. And we're seeing that revenue growth because of those ad market conditions improving, better demand, better pricing, and also because of that monetization engine that we've built and continuing to improve within the business.

14:04 I think I said it earlier. You have one key point, probably the most important part of that trading update was our q four EBITDA results. So $2,100,000 of adjusted EBITDA in in q four. That means that more than 10% of that revenue was being converted to to EBITDA. So I think that highlights to to you. I hope that our model can gear EBITDA. As we get that revenue into the high teens and early twenties, we'll see gearing on the EBITDA side. And as I said here, we delivered more than 10% of of EBITDA margin in that that final quarter, up significantly, 1,600,000 up on q four of of twenty twenty three.

14:54 The reasons why that EBITDA gears at a certain point is because we've updated our our contracts with podcasters, which delivers which reduces minimum guarantees and allows us to overdeliver and and therefore retain more of that revenue. And, also, as as we'll highlight later in this presentation, we have a very, very stable OpEx base. It it really doesn't move very much year on year. And, again, while that is is pretty static, as revenue grows into those higher numbers, we're converting a lot of that to to to adjusted EBITDA. So great, very pleasing EBITDA numbers for the year and, in particular, for the for the quarter. Our KPIs, we have three KPIs that we we publish every quarter and allows you to to track the the health of of the business, and I'll break those down in more detail on this slide. The first one of those is our global downloads KPI.

15:57 This is really a view on the size of our network, and the size of our network is something of a proxy for how much advertising inventory we can sell at any one point. So for q four, our global downloads monthly number was, what, 91,000,000. You'll see on this chart here very clearly, I think, and we've we've we've highlighted it, that Apple's iOS update that I mentioned earlier in the presentation has affected those those downloads. So that update removed and reduced how downloads are measured across the industry, and you can see the the effect of that here. Now, obviously, we have plans to to to to grow this back, and one of those key plans is is is video distribution.

16:45 And we will start to give you a view, I think, from from q one of this year onwards on video distribution and our our work to to distribute this content via video and grow audience and therefore grow consumption and build back this this number pretty quickly, I think, across 2025. So while that one is down, you can you know the reasons for that, that being the outside impact of of Apple's iOS update. But we we certainly have some some good plans for pushing that number back up into a a healthier place. The second KPI, slight name change here, actually, just to highlight. Like, we've we've changed the name of of this KPI to RPM, revenue per thousand downloads. We used to call it ECPM, but RPM, revenue per thousand downloads, just to bring that in line with with the industry and and and various other media formats.

17:38 This is a measure of how much revenue we extract from every 1,000 downloads of podcast content on our platform. And I think a fantastic number in q four of of twenty twenty four was delivered $75.62. We are extracting from every thousand downloads of content. That is that's market leading. There's no one else that can touch that in the podcast space. Certainly, no one is is able to do that in the audio space. Video space is is comparable, but we are definitely a market leader in the audio space on that that revenue per thousand metric there. You just see on the chart, and it's worth touching on this. Most times I I highlight this.

18:24 You'll see how that falls off when there's a weak advertising market. So in that 2022 and early twenty three global ad market recession, you can see that RPM number drop back off, and we've worked very hard to build out our monetization engine, improve our revenue, our pricing, and our sales to to get that back up to a record number in q four of twenty twenty four. And then the final KPI is brand count. That's really a a custom account, how many brands are paying us every month to advertise on our network. Another record here, which is a fantastic achievement, a record of 9,497 brands advertising on AUDIOBOOM per month in in q four. Really shows for me two things that are working at AUDIOBOOM. One is, which we will go into great detail on soon, is Showcase, which is our ad tech based marketplace. It's very efficient. It allows advertisers and brands to come in and and and and advertise very cleanly and efficiently at great scale on AUDIOBOOM, and that's helped drive this brand count number up over the last three years to this record level. And then secondly, as as many of you will know, just over a year ago, we launched a new team within AUDIOBOOM, a new sales team focused purely on growing relationships and growing business with blue chip brands, you know, those bigger global brands that are represented by the large advertising agency holding companies, and they are getting good traction and bringing

19:55 in money from, I think, now 12 of the top 15 major pop major advertising agencies in The US. We're seeing great traction there, and that's leading to that strong brand count number for q four of last year. So positives very strong positives on on two of those KPIs and and good plans, I think, to to take that global downloads number back into a much healthier place in '25 and beyond. Let's talk about the key drivers, I think, of success in in 2024. Showcase is one of those key drivers, and I'll give you a lot of detail on that now. So what is Showcase? Well, Showcase is our second advertising product that we have in in the business launched in late twenty twenty one.

20:45 And Showcase is a a global advertising marketplace that is that runs through our advertising technology. So it's a marketplace that that we have built. It's very efficient. It's all automated. And what Showcase does effectively is it matches up supply and demand. So

21:02 on one side, the supply is all of our content and the advertising inventory within all of our content. And on the demand side, that is advertising sales from our team as well as various ad tech and programmatic demand side connections with ad networks around the world and ad buyers around the world. Showcase matches those two things up in real time at massive scale and includes a lot of really fantastic technology for audience targeting so that brands can come in and say, hey. We really want to get our messaging to females that live in the Northeast Of America and who are between the ages of 34 and 50 and have a annual household income above a $100,000.

21:51 We can target against that audience, and that makes that very appealing to those those blue chip brand advertisers. So Showcase is matching up that supply and demand with some very strong targeting capabilities. And it's growing quickly, and it's proving to be an important part of of the AUDIOBOOM business. So last year, it delivered $23,100,000 of our of our revenue, up 56% versus the the previous year. So you can see the strong growth in that showcase revenue product there. We're increasing pricing within there. So as advertisers use more of those targeting capabilities that we've we've built in showcase, we can charge more for that targeted advertising, and we've been able to increase pricing in Showcase by 30% over the past year.

22:43 And as I said before, we're doing this at bigger and bigger and bigger and bigger scale. So during the year, more than 4,000,000,000 ads were transacted within showcase. So you can see the scale. You can see the efficiency of of this being technology based, and that gives us an advantage over many of our competitors that do not own and operate their own technology. So that's a a key point, I think, for AUDIOBOOM. The ownership of our own technology is starting to prove more and more valuable as we go forward. And all of that, I think, is to say that showcase booming is important in our business model because it's our highest gross margin product. So our three main products that we that we have in AUDIOBOOM is our premium advertising sales, Sonic, which is our our our brand focused platform, and then Showcase, which is our our marketplace platform.

23:41 And Showcase, as you can see here, has a 31% gross margin versus the 20% gross margin of premium and the 15% gross margin of Sonic. The chart just above those numbers highlights the change in our revenue mix over the past three years. So we went from a place where where Showcase, with its high gross margin, was only contributing 11% of our overall revenue to this past year where it contributed more than 32% of our of our of our revenue mix. So real focus from us on ensuring that showcase with its higher gross margin is is contributing more and more to that revenue mix. That will allow us to gear gear EBITDA as we go forward, and it's proving to be a successful piece of work for for us.

24:34 How does Showcase operate in reality? Yes. And and why is it so good for us? Well, one thing that it does is it helps optimize our inventory. So this past year, through showcase, we were monetizing four minutes of of of content per hour through with with advertising. Previously, we were only monetizing two point seven minutes of per hour of of content in 2023. So a big step up there in how much, you know, how much advertising space we are selling via showcase in in that time. And I think the other key part here is there's significant potential to take that that even further. Right? If we're only selling four minutes of ads per hour in in podcasting, the closest competitive product to podcasting is radio.

25:26 US radio has twenty minutes plus of of ads per hour. Now we're not gonna take it to that level. We want podcasting to be a high quality product, a good listener experience, but there's certainly room to move from four minutes of ads per hour to six or seven minutes of ads per hour sold through showcase in in the coming years, and that will, of course, drive revenue. It will drive that RPM metric and and improve the the quality of the business. The second key part to showcase is the development of the advertising tech that I mentioned earlier. Obviously, owning and operating our ad tech here is very important, but we also leverage the best third party technology to improve and optimize showcase as well. You'll have seen in the trading update today that we mentioned a new partnership that we are assigning with a company called Triton to utilize a piece of technology TAP.

26:21 TAP allows us to optimize our ad serving and showcase and and get the best pricing, fill the most amount of inventory, and and make the most of all of that advertising inventory. And, again, that will be a piece of optimization work to improve showcase as as we go forward. And we've talked in the past, I think, about some of our other owned and operated tools that we have built, like AdRip that creates new inventory and podcasts and our brand safety tools. All of that coming together to improve showcase and and and make it a bigger part of our revenue mix next year. And then finally, we continue just to invest in building the demand side of showcase, making sure that we fill as much of that inventory as we possibly can. So that's further investments in The The UK and the US brand sales teams. We've made hires in 2024 to add to those teams, and it will be an area of investment again in 2025 to to build out those those teams.

27:19 We also continue to partner with key demand side partners. One partnership that we mentioned in today's trading update was with VoxNest. VoxNest will provide commercial support to to showcase so they will have access to through their own platform to monetize some of AUDIOBOOM's inventory in in Showcase. They get direct access to that. That will optimize the the sales part of Showcase as as well. So this piece of work is ongoing to improve Showcase and and make it even stronger in in 2025. And with that, I think I'll take a break and pass it over to Brad to go into some of the numbers in more detail. Okay. Thanks, Stuart. Hi, everyone, again. So, yeah, let's go through these next few financial focus slides. They continue on from the q three investor week session. We introduced a few new data points, and, obviously, now we can give you a full 2024 context on those.

28:17 This first slide focuses on revenue, gross margin, and our podcast partner minimum guarantee exposure over the last six quarters, falling on from what was a very strong update this morning on 2024. We obviously finished the year very, very strongly. Important point when looking at this business, something investors should be aware of is, obviously, when reviewing this company, like other businesses that recognize advertising revenue, seasonality affects what is recognized and when. So typically, we see a quieter first half of the year and then building into a stronger second half of the year, and this is absolutely what we saw in second half of twenty twenty four. Fourth quarter of the year, that was a fifth successive quarter of year on year revenue growth following the challenges of '22 and 2023.

29:07 7% revenue growth in in q four and q four, 13% revenue growth overall above wider podcasting industry growth. So all positive metrics. Showcase, obviously, is just taking you through that in terms of the, you know, the really positive metrics that we've that we've had on that. And importantly, for our adjusted EBITDA, that higher gross margin that we recognize on on Showcase as well. You can see that chart on the top left hand corner where we've seen our revenue progression over the next six quarters. And what we're looking for in the first quarter of twenty twenty five is obviously to go through that 17.1 that was recorded in the first quarter of last year. Top right on the graph details our gross profit and gross margin and how that's progressed over this year. We've seen a $2,000,000 improvement in gross profit in Q4 this year versus last.

29:55 And when we take into account the interest contract provisions that we provided for in 2023, there's a $17,000,000 increase in gross profit, '23 sorry, '24 over 2023. So a good, obvious improvement on that line as well. We can also see how the gross margin percentage has improved in the last six quarters, improving from 3% in q three of twenty twenty three to 24% in q four of this year, and that's obviously successive gross margin improvement there as well. So lots of lots of positive metrics to to show there. How's that been delivered? Well, we obviously have the revenue growth. We have the higher contribution from from showcase, and that has enabled us to really reduce our minimum guarantee exposure. Let's take a step back. Let's look at minimum guarantees just to make sure that any new viewers understand what they are. So to secure exclusive advertising rights to leading podcast talent, we offer carefully modeled MG revenue share contracts.

30:54 Once those minimum guarantees have been agreed, it's our job as a company to meet and ideally exceed those MGs in order to deliver the gross margin that we are targeting. So typically, that gross margin on the tier one podcast talent will be 20% to 25%. What we saw during the more challenging conditions in 2022 and 2023 were minimum guarantee contracts, whereby the deals agreed were based on higher advertising rates than what we're able to be obtained after the downturn. Where we don't achieve those contractual monthly NGs, what we have to do is what we call a minimum guaranteed true up. That's effectively a shortfall on the agreed minimum revenue share, and therefore, we recognize a lower gross margin. The company has worked extremely hard to, a, honor all contractual MG payments to our podcast partners to maintain the relationships with our partners and our talent agencies we work with. And when contracts come up for renewal, Stuart says, you know, we've restructured them to ensure that the new MG levels are attainable.

31:57 The graph in the bottom right hand corner details the percentage of content partner payments that relate to MG interrupts over total cost of sales. So we can see that spike in the third quarter of twenty twenty three when we recognize our exposure to MV drops in our p and l. Since then, we've seen our exposure significantly decrease quarter on quarter as we focus on maximizing the value of the inventory on MV shows. Showcases help with that. We're now clearly seeing the benefit the beneficial impact of contract restructuring, focused efforts from our sales team and general recovery in the podcast ad market. Reducing our exposure to MG contracts, increasing our top line memory number, you know, they've had a very beneficial impact on gross margin and, importantly, on the adjusted EBITA that we report. Let's go on to that next slide.

32:45 You know, what we've consistently said over the last couple of years is the OpEx base doesn't change. Top left hand graph, we can see that there. OpEx hasn't really changed this year quarter on quarter. You know, we said because of that, when we return significant revenue growth, adjusted EBITDA would grow or gear because the cost cost base wouldn't change. That's exactly what's happening in the second half of this year. Revenue's grown. MG exposure has reduced. VOpex hasn't changed. EBITDA has increased, and it's increased significantly. That's really pleasing. That's a validation of what we've been communicating with recent updates. It's a validation of what this company and the model is capable of. There's a question from Adam that's coming while we've been talking today about the profit and, you know, when we can expect that to increase. And I think what I've just spoken through there shows how it can increase because of that relatively fixed OpEx base.

33:40 Revenue growth now, you know, over and above what we've delivered this year will obviously go to that profit line, and that's our that's our expectation as we as we go forward. From an OpEx base, it's in line with previous quarters at $2,800,000. That allowed our adjusted EBITDA to reach 2,100,000 in the fourth quarter, 3,400,000 for the year, 3,800,000 higher than last year. That OpEx in Q4 is consistent with previous quarters, 65% on staff costs, 25% on technology costs. That consistency in makeup will continue as we go forward with plans this year in 2025 to supplement the sales team with a few additional heads, but, you know, we're we're still we believe with efficiency leaders in podcasting, our headcount is not expected to go significantly higher than the 40 heads that we ended 2024 with.

34:33 And stating the obvious, but with a higher revenue number and a static employee number, average revenue per employee increased 10% year on year, up to 1,800,000 per employee. Over to the cash and debtors and working capital, it's very efficient in that. We if you've listened to us before, then you know we pride ourselves on that and continue to collect our debtors very quickly, end of the year on collecting 97% of revenue booked this year, which fantastic. The revenue recognized comes with minimal risk attached. On the right hand side, you can see what we provided for in terms of any bad write off, representing just 52 ks in the year, so a very small proportion of our revenue booked. Our debt to date remained consistent versus 2023 at 82.

35:21 Our ongoing target to be below ninety, ninety being the typical payment timeline for advertising agencies. The cash balance, relatively consistent over the last year or so, but obviously, that does take managing because as revenue increases, especially during the second half of the year associated with revenue share payments, also increased as well. And we also have serviced a couple of onerous contracts that we are fulfilling through to their conclusion, for which the true ups of those have unwound against the balance sheet provision that we created in 2023. So no p and l impact. But because of this, we see minimal movement on that on that cash balance. We are confident in that internal working capital cycle and its processes.

36:06 But given that relatively modest cash balance, it's essential that our you know, we're on point with our collections as as always, and we need to be during the first quarter of this year. Receipts from our main customers are now very material on an individual basis. So I think that's, you know, one of the main reasons why we extended that overdraft with HSBC. We we announced that this morning. Just to give ourselves that courage that that coverage should anyone of our material debtors just be slightly later than we would usually expect in terms of paying us. So it's a good endorsement of what we're doing here that HSBC were able to extend that facility and shows their confidence in the business as well. In terms of cash generation, question that's coming today and a typical question as well. When when can we see that?

36:52 Well, historically, adjusted EBITDA has been that proxy for cash generation. But in 2023, we did provide for a couple of onerous contracts, one which ends at the end of January twenty twenty five, so in a in a couple of weeks. Weeks. And we do have, I mean, a more material one, does end in December 2025. You know, while we're servicing that that contract through to the end of this year by unwinding that provision against the balance sheet, you know, we we would expect minimal moving on that on that cash balance, really, until we get through through the other side of that contract, and that's gonna be into twenty twenty twenty six. You know, at that point, I would expect our expectation is that adjusted that will again be proxy for for cash generation. So, yeah, that's the last of my last of my slides there. I'll hand back to Stuart.

37:43 Keep the questions coming in. I'll I'll monitor any. Yeah. Back to you, Stuart. Thanks, Brad. Last section for me then is our focus for 2025 and beyond. You may or may not have seen the market expectation numbers for next year that that analysts put out this morning. So that's $80,000,000 of revenue for 2025 and four point five million dollars of adjusted EBITDA. As always, you know, what what we've done a great job of in in the past and we'll look to do again for 2025 is to outperform those numbers and go go beyond them, and I think we have a fantastic chance to to to do so. How are we setting up for that? Well, I think the key points are here. So the ad market is continuing to improve. We know there was an ad market recession in 2022 and 2023.

38:33 Last year, we saw some initial improvements in that advertising market, particularly in h two, but we are feeling more and more confident in in the advertising market. It's continuing to improve. We currently have $54,000,000 of advertising revenue booked for 2025 through the through the upfront process. That's a sales process that happens in November and December of the previous year where we are working with our customers, our major customers to to to to put a lot of bookings in place before the year starts. And that's a record number for us, significantly up on on last year's upfronts number. So 54,000,000 towards that 80,000,000 already on the books.

39:20 And that I think the key part to to that is the pricing that we're seeing. So the upfront pricing this year is around 17% higher than than than than it was for 2024. And so not only are we seeing good demand there, we're also seeing confidence in the medium because we can we can drive pricing higher in those upfront bookings. So that's setting us up well to achieve and overachieve, I think, that that $80,000,000 number. Showcase, I think I've talked through them through most of this, so I won't labor that point because I'm conscious of time. But I've shown you what Showcase is, how it how it works, how the new partnerships with VoxNest and and and TritonTap can help optimize it and and why it's important to get the to to get that as a bigger part of our our revenue mix.

40:12 We also announced in the trading update a big group of renewals. So, you know, reupping contracts with our biggest content partners, again, give us gives us great visibility on on what this year looks like, allows us to go and sell advertising for those shows ahead of time. And, you know, just one of the most important things that we do is is to renew and and create very long term multiyear partnerships with those those those key content partners that we have. And, you know, very similar to that, we announced a group of of new signings to the network as as well. Those will deliver many million downloads per month, you know, in in 2025. So we continue to sign top tier shows to to the network.

41:00 You know, being able to show podcasters that we have a market leading $75 per thousand download revenue engine is fantastic for us to be able to to sign the biggest and the best podcasts that that are out there. And then I think the the final part that that gets us there is the continuation of building those those technology tools, investing in the tech, building out tools that that really move the needle when it when it comes to revenue as we've done in previously years like AdRip and AdVet, two tools that that that you know about. So all of those those parts are coming together and will get us focused on on going above and beyond that $80,000,000 number. In terms of the EBITDA number there, 4,500,000 being the market expectation.

41:46 Brad Brad really kinda touched on this, I think. So, again, I won't label this point, but that stable OpEx that we have, not expecting that to to to move significantly higher in 2025. You know, that that allows us to to really gear the the part. We know that showcase has the higher gross margin as it becomes a bigger part of our revenue mix that allows us to to to to push that through. And then continued work to reduce those minimum guarantee obligations, making sure that those minimum guarantee true ups that Brad talked about are are minimized. You can really see how this model starts to work when when we do that. So it will be a record year for AUDIOBOOM, and we are fully focused, I think, on on on taking it to an even better place.

42:34 That's it from the slides. Conscious of of time, like I said, because we're getting towards that that forty five minute mark. We have a few questions here to answer. Jake, I'll throw it back to you for a second or two. Perfect. Stuart, Brad, thank you very much indeed for your presentation this afternoon. Ladies and gentlemen, please do continue to submit your questions just by using the q and a tab that's situated on the right hand corner of your screen. But just while the team take a few moments to review those questions that were submitted already, I'd just like to remind you that a recording of this presentation along with a copy of the slides and the published q and a can all be accessed via your investor dashboard. Guys, as you can see there, we have received a number of questions throughout your presentation. Thank you to all of those on the call for taking the time to submit their questions. But, Stuart, Brad, at this point, if I may just hand back to you just to give those responses where it's appropriate to do so. And if I pick up from you at the end, that would be great. Thank you. Yeah. Thanks, Jake. This first one actually came through on the the platform ahead of time.

43:30 This similar question from from two from two people. It says, trading activity has been significant since September. Are you aware of any large changes in in shareholders? I mean, look. It's been pleasing to see liquidity return. Of course, it's pleasing to see the value of the business starting to return to a level that more fairly represents what we what we're doing and what we've built. We're aware of two new institutions who are building a position in in the company. That's a a great sign, obviously, that there's confidence in in what we're doing and the results that we're seeing, and we've been able to present the same presentation to to to those institutions over recent times. So so great to see that. I can't tell you much more than that, obviously. But, of course, if those institutions reach 3% threshold, there will be a TR one that highlights that change. So, you know, if they continue to build and and go beyond that 3% level, that's when you'll see a a TR one. But, yeah, I'm I'm pleased that there's there's confidence from institutions in in the work that we're doing. Another one that came in ahead of the presentation says, how do you advance to becoming the third biggest podcast publisher in in The US?

44:46 I showed you those rankers earlier where we are fourth. Those are based on the size of the network or downloads and consumption across the network. Our challenge, as you've you know, we also saw Apple Apple's change impacting the number of of of downloads and the size of that network. Our challenge is to accelerate the size of the network, and I think that's our challenge for for the next three years. We have the monetization engine. We know that works. We know we we can monetize things at $75 per thousand downloads. We just need more downloads to monetize. Right? So that's our challenge. Where do how do we build out the size of that network? And the AUDIOBOOM team, as of this week, our challenge to find the next 100,000,000 downloads. So that's their challenge. That's the the the piece of of work they are being given. How do we find that next 100,000,000 downloads?

45:35 You can see from our KPIs that recently we've been averaging just under just around a 100,000,000 downloads a month. How do we find that the next 100,000,000 effectively doubles the the size of this network? Well, there's many ways to do that. We'll obviously continue to sign the biggest and the best podcasts. We'll look to expand further into video. YouTube is becoming a big consumption point for podcasting, so we will work with our podcast creators to expand their use of video and have more consumption via YouTube. So video will be a big area that we're working on. We will target enterprise level partnerships, so no no longer just working specifically with independent creators who may have one or two podcasts. We will work with networks and media companies who have groups of podcasts. Now they need slightly different tools to the independent creators, but that will be some of our investment in the technology that we have is to to build out those tools for enterprise level partners.

46:30 Then also, I think we, you know, we identify publishers and and networks for acquisition. We can bolt those networks on top of the AUDIOBOOM platform. Those networks can do the thing that they're great at, which is creating the content, and then our monetization engine, our distribution engine can do that that that piece of work. So we will look to identify publishers and networks that we could roll up. Now more possible, of course, because the share price is improving, and it allows us to to to strike deals a little easier, I think. So, yeah, finding that next 100,000,000 downloads is the AUDIOBOOM's team team's focus, and that will get us into a a place where we can move up that that ranker.

47:17 Tony f and Az both asked about Nasdaq. We talked about that in the past. We previously said, I think, the last call that we had that we'd spent some time over the back end of the summer working with consultants and and contacts here in The US to understand Nasdaq, what it looks like, what we need to do to to to to get there. Key feedback that we explained was that our current size, it it's it's really it would be tougher for us to to do because we would not have the size and the scale to be visible to the right type of investors in in The US. And the numbers that we kind of talked about or the goals that we talked about were getting to the point where we had a $100,000,000 of revenue and 8 to $10,000,000 of EBITDA.

48:07 That would be the time that we would have the size and the scale to to really get the best value out of a move to to Nasdaq. So we can see there's a pathway there. I think you'll see even more in these most recent numbers. You know, you start to annualize that q $420,000,000 plus of revenue and 2,000,000 plus of of EBITDA, and you can see that there's a a pathway over the next year or so to get us at least into a position where we could make an effective move to Nasdaq. So it's still very much on our, you know, in our focus, and and, you know, we have a a pathway to it. And then I think final question from my end. He says, do you expect 10% EBITDA margin in the first part of of next year?

48:53 Obviously, I said it was key part of today's results was was that number because it highlights the gearing of our model. No. Look. We don't think we expect it in the first part of next year. There is seasonality within this business. I think Brad explained it pretty well actually that we pay minimum guarantees to to podcasters. Once we have gone past that minimum guarantee that we pay to podcasters, we keep more of the revenue and more of that flows through to EBITDA. And, generally, our podcast contracts are staged across a calendar year. Some are not, but many of them are staged across the calendar year. So once it within that contract, we go through the minimum guarantee that generally is later in the year, then we can hold on to more of that revenue, and that flows through into EBITDA. So we do expect seasonality in the EBITDA margin to be weighted towards the the second half of the the year for sure.

49:49 I hope that explains that one. I think we're pretty much out of time, so I will leave the questions there. And just to say, think, again, thank you for your time today. Thank you for your questions. Thank you for supporting the the the company. It's been great to be with you. Thank you. Perfect. Stuart, Brad, if I may just jump back in there. Thank you once again for updating investors this afternoon. Could I please ask investors not to close this session as you'll now be automatically redirected for the opportunity to provide your feedback in order the management team can really better understand your views and expectations? This will only take a few moments to complete, but I'm sure it'll be greatly valued by the company. On behalf of management team of AUDIOBOOM GROUP PLC, we would like to thank you for attending today's presentation.

50:34 That now concludes today's session. So good afternoon to you all.