Avon Technologies (LSE:AVON) — Interim Results for the six months ended 31 March 2026

0:00 Good afternoon, ladies and gentlemen, and welcome to the AVON TECHNOLOGIES PLC Interim Results Investor Presentation. 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 will publish your responses where it's appropriate to do so on the Investor Meet company platform. Before we begin, 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. And I would now like to hand you over to the executive management team from AVON TECHNOLOGIES PLC. Joss, good afternoon, sir. Afternoon and afternoon, everyone. Thank you for joining us. I'm Joss Slater, I'm the CEO, and on my right is Rich Cashion, the CFO, and on my left is Steve Elliwald, who runs our AVON protection business. And we'll take you through the slides. They are the slides that we gave us at the results, but we will try and go through the narrative maybe a bit quicker than we do with the results.

1:05 It was a very good first half for us. We delivered very strong revenue growth, strong profit growth and excellent margin progression. We actually moved our margin into the target range that we originally set for 2027. So we delivered it eighteen months earlier than originally planned. But we are now getting to the end of our transformation program. It was always expected to be a three year program. It will end as anticipated at the end of this year. It has involved a lot of heavy lifting for the team that you see in front of you. As that comes to an end, it does free us up a bit more to really focus on organic growth.

1:55 Potentially, if we found a value creative idea, we would look at buying and improving other companies in our space. We do have a strong balance sheet. It continues to get stronger, and we anticipate it will get stronger still as we go through to the end of this financial year. That does give us some latitude either to look at acquisitions or if we couldn't find anything to return capital to shareholders. So with that, I'll hand over to Rich and he'll take you through the financials. Thanks, Josh, and thanks everyone for joining. So as Josh said, we've had a strong start to the year. We've made some good strategic and operational progress, and that's starting to feed through into pretty strong financial performance.

2:42 Headlines are order book is down a bit as we work through the team when the military backlog and we'll talk about that a bit more about that in a moment. But revenue is up 7%, operating profit is up 39% and EPS is up 45% compared to the same period last year. The standout number for me though, given that my preferred measure of performance is ROIC is that our return on invested capital is up 450 basis points to over 20%. This puts us comfortably ahead of that 2026 goal of ROIC of over 17%. Cash conversion wasn't particularly great at 38%, but we did have a late flurry of deliveries in March, pushed the receivables balance over the balance sheet date. We actually received $18,000,000 of cash very early April.

3:35 Had that been captured, cash conversion would have been a 100%. Notwithstanding all of that, net debt to EBITDA at at the end of the half was still around 0.9, so the balance sheet is in great shape. So looking at the P and L, as usual, comparators are on a constant currency basis, but order intake of £118,000,000 was down on a very strong first half last year. We have got a very robust order book of $220,000,000, which covers us well into 2027 and beyond. Revenue growth of 7% up to 161,000,000 with particularly strong growth in AVON protection more than compensating for a bit of a slow start in Team Wendy. That's dropped through very nicely to operating profit, as Josh said, within the 14% to 16% guidance range of 15.2% or $24,500,000 Finance costs came down again, reflecting the lower average net debt. So that gives us adjusted EPS of $0.05 $64 up over 45%.

4:35 The dividend is going to move up about 6.5%, which is broadly in line with the increase of the full year to $0.81 per share. Within AVON protection, order intake dipped a bit, but that compares to a very strong first half in twenty twenty five where we benefited from about $30,000,000 worth of what we would class as one off or unicorn orders, including some support for Ukraine. Strip those out, you can see that actually the underlying momentum is continuing to progress strongly. And in fact, we we we announced an additional order on Wednesday with the half year results for a $14,000,000 filter contract from the US Department of War, and that will be for delivery over the next twelve months.

5:20 Order book is continuing to grow at a 112,000,000, and that that that's quite significant because historically, this business has had a very low order book. It's a fairly fast wind and ship business. So we've got enormous confidence in the second half and beyond in this business. Revenue growth of 23 reflects excellent underlying trading, particularly in relation to our European contract, the NSPA contract, where we acquired an additional two nations. And the drop through to adjusted operating profit gives margin of over 22% for the half. That is exceptionally strong. We benefited from some product mix. And we also well, the margin was flattered to an extent by whilst we have a desire to continue to grow investment in in growth around r and d and new product introduction, it's very hard to grow that investment at the same rate as as revenue growth when revenue is growing over 20%.

6:19 So I do expect those factors to normalize over time, but a very strong first half. Team Wendy has actually made a lot of strategic progress in the first half, but not all of that has flowed through the flow through to the numbers yet. Order intake did decline, and order we're we're burning through the order book. We do that as a bit of a positive, actually, because whilst we have very strong order cover on the DOW contracts well out into the middle of twenty twenty seven, the Department of War is not motivated to give give us any more orders until we start delivering the ones we've got. So the quicker we can deliver that backlog, the sooner we will get new work. And I'm sure Josh will talk about that later. Revenue, therefore, was held back. We did have that slower ramp up than planned in the first quarter, And we saw some commercial softness as the grant funding in The US was held back by government shutdowns.

7:14 We are seeing recovery in all of the above. And we are now up to full production rate on both ACH and IHIPs. So I do expect to return to growth in the second half and for the year as a whole in Team Wendy. What I will say though is that the improvements we've been making over the last eighteen months are now starting to feed through to operating profit, which is up 100 basis points to 5.4% in the half. And then just before I hand back to Joss, it's worth stepping back given some of the changes in the world we're seeing around us and looking at some of the longer term growth opportunities in our markets alongside the sort of near term stuff that I've just been talking about. The the geopolitical environment has certainly shifted materially over the last few years. We're seeing more conflict now than than we have since World War two.

8:04 This is clearly driving higher investment, particularly in Europe as as Europe moves to a a reinvestment cycle and The US adjusts its positioning within NATO. In the near term, demand has been reinforced by the conflicts in Ukraine and The Middle East, both of which have highlighted the continued use of conventional warfare and the increased threat from chemical weapons. So what we're seeing is defense budgets are going up, and the amount of money in those defense budgets that's being diverted towards CBRN equipment is also going up. On so that that certainly helps AVON protection specifically. In Team Wendy, improved ballistic protection remains a key theme with increasing numbers of military and first responder people and increasing gun crime, particularly in The US driving upgrade cycles.

8:51 And then on the right hand side of that chart, very high level view, but you can see that the key the trends in all of our key market growth drivers are moving in the right direction and at a stronger pace than they they were were last time we did this analysis two years ago. I'll now hand back to Joss to to run through our update on STAR strategy. Thank you very much, Rich. So just a reminder of our high level strategy. The first part of it, top left, is that we continuously strengthen our businesses through our strengthened system, which is a it's our own proprietary version of continuous improvement. We are still running two projects on transformation.

9:36 One of them is to increase production reliability in our Cleveland plant, and I'll talk a little bit more about that in a second. And the second is improving our IT function whilst simultaneously reducing the cost of it, which sounds counterintuitive that we can do both. But in fact, what we found is that it was less efficient than than it could be and less effective than it could have been, and we're addressing both of those. It will lead to a run rate saving of $1,500,000 or so once we've completed that project. It is going extremely well so far. AVONZE is all about building sales capability and developing products that deliver medium term growth.

10:24 And REVOLUTIONIES is all about investing into long term projects. And by that, we really mean projects that are unlikely to result in revenue growth for at least five years. So we're looking really in the five to ten year period there. We'd like to keep an eye on that to make sure that we are investing into developing products that drive growth in the long term for us. This slide just shows how we see continuous improvement. I think people sometimes assume that the benefits of continuous improvement are linear.

11:10 We actually see the benefits of continuous improvement as exponential because each improvement adds to previous improvements. So it does compound over time. We've seen that in AVON protection, which is entering phase four now, that it's some way up the curve and has had extremely good results. And its margin now is up to over 22% operating profit margin. Team Wendy is earlier in its maturity. It took a bit longer for us to embed the culture, but we do now see it starting to improve every single week, and we're very happy with the capability we've got there. So we do expect to see further improvements coming through with increasing pace in the future.

12:01 This just shows how we've delivered opposite the non financial metrics that we set out, three years ago now. We originally wanted to increase productivity by 35%, and we have delivered a 44% improvement in productivity so far. And it's perhaps worth bearing in mind that originally that target was for next year rather than this year. We do believe that productivity ultimately equals wealth, both for our internal people and, most importantly, for our shareholders. Scrap rates have come down 62%, again, exceeding our target eighteen months early.

12:50 They have actually crept up a bit recently, although not really through our fault. One of our we were forced to change a supplier, a critical supplier, actually, because they stopped making the product that we needed and the quality of the new supplier is not yet where we want it to be, but we are working on improving that and I'm sure it will come down in the second half. And then on inventory turns, as you can see, they have steadily increased. At the moment, we're actually more focused on improving production rates in team Monday. But over the medium term, we're aiming for a target of five, and we are still aiming for that target, and we'll look to make more progress next year. Production rates are important to us in our Team Wendy business.

13:42 The higher the production rates, the better margins it makes. And also, in the first half, we had a situation where we recruited people in the first quarter in order to increase production rates in the second quarter, which did mean that productivity temporarily dipped in the first quarter and and margins were there. IHEX has been steady. We're already making at the rates of the customer demand. We have, however, achieved the rate we need on one shift, whereas formerly it used to be on two. And on ACH, we've actually doubled production over the last six months, and we are now hitting the rate that the customer wants, and actually, it's the rate that we're contracted to demonstrate that we can deliver as well.

14:33 We were contracted to deliver 9,000 a month, and in March, we actually delivered 9,800 a month. So we've exceeded what the customer wanted us to do. We are the only supplier, I think, to hit the contractually required rate at the moment. Just a quick summary of what's driving growth across the business. As Rich mentioned, the threat environment is increasing. I actually see it. There is a question on does change in government affect demand? The answer to that is not really. Demand for business like ours is really driven by the perception of conflict.

15:21 At the moment, Russian aggression, Iranian intransigence, and the potential for Chinese aggression, most notably against Taiwan. All of that increases the threat environment and then governments respond by increasing spend on defense. And then in addition, we do sell into the police markets the threat of civil unrest in The US and increasing gun crime also provides demand for us. We continue to drive competitive advantage through continuous improvement. We see continuous improvement as strategic because we believe that by improving every week, we create enduring competitive advantage versus our competitors, and it enables us to win more business by ensuring that we are cost competitive.

16:23 We continue to expand our portfolio. Steve will talk more about that in the context of AVON protection, and I'll talk about it in the context of Team Wendy. We have invested a lot into the sales team recently, most notably the international sales team. And when we say international, we mean outside of North America. And we are diversifying our business into adjacencies, and Steve will touch on that in a second. Okay. Thanks, Joss. I'll just go over the slide. So as you've already heard pleasingly, protection continued its growth journey. Revenue was 23 percent up. Order book increased 19. Pipeline ahead of us is at record levels. Just a few examples on this slide. Demand across NATO remains really strong, and we now have 16 nations purchasing the FM 50 respirator under that MSPA contract.

17:20 Earlier in the year, we announced the 30,000,000 order for The Middle East. It was a a new customer for our filter products. We're very, very pleased to have won a 100% of the latest Department of War for filters that was worth $14,000,000. This was the one that we announced post close of the half year period, so you can't see that reflected in our results. This program is particularly exciting as it's the first time we've secured full filter program for what is normally a dual sourced award. Later this year, we will launch our new digital voice projection unit, which improves speech clarity in the demanding operating environments our users operate in. You can see the pipeline on the screen. It's very strong, and units are already in quite advanced trial stages with military users around the world. And then lastly, the pipeline for our next generation powered and supplied air systems looks great.

18:24 We expect to receive independent European certification for our latest supplied air system fairly soon, and that will open up a broader market in the European defense market. Part of our growth strategy as well as the core I've just talked about is expanding protection into the adjacent markets. In non chem bio, we were delighted to secure a multiyear Canadian Armed Forces contract for MITRE, which we announced this week, and we've now started to receive orders under that contract. That's the first Five Eyes nation to adopt a half mask capability, and we expect some other Five Eyes countries to do so the same fairly soon. The MITRE half mask also achieved independent US and European certification in the first half of this year and that opens much broader law enforcement and first responder markets where that certification is required.

19:19 MITRE remains the only half mask that is both independently NARCH certified and is purpose built as a military system, which I think reinforces the market leading position of this company. In integrated CBRN, we expanded the suits range and we've been successfully then selected to take part in competitive evaluation trials with the US Department of War. So we've now got several 100 suits that have been ordered to support those trials, and we're in the process of delivering those now. That's a significant potential opportunity for us in the next fiscal year, and we're building the support of the supply chain to support any potential future ramp up there. On boots and gloves across NATO, the contract ceiling for our NSPA contract with that product line has been increased by 50% to meet the European realignment demand and demonstrates the demand we have across Europe.

20:15 That order book for that product now runs well through till the end of twenty twenty seven. Underwater, disappointingly, France did cancel their rebreather tender with some budgetary challenges, and we expect that to come out as a recompete later in the year. However, we are working on opportunities with the Australian Navy, the US Navy, the US Marines, and the UK's Royal Navy as well as being extremely busy delivering the backlog for this product. So this slide tries to demonstrate some of the major programs we have in place and we can see in the future. Across the top there, 50 m 50 and m 53 a one are expected to remain in service with the US military at scale for the foreseeable future, and we're working with the customer to to simplify contracting and bring those two programs together.

21:09 In parallel to that, we are engaged on midlife upgrades to the masks, and those are designed to materially reduce the burden on the soldier and improve their combat effectiveness. This will create a fairly compelling upgrade path for that US customer from from what is now an aging m 50 installed base to more modern m 53 like systems. Longer term, that will position us well also for the next generation respirator program and gives us continuity and volume visibility whilst that transition takes place. Alongside masks, we've got a number of long term opportunities across filters, suits and there's a new NATO systems program that provides an upgrade path for that growing FM50 installed base in Europe to more modern fifty three and fifty four masks as we go forward.

21:59 And then finally for me, revolutionize to sort of longer term. We're now starting to move beyond some of those stand alone products and really transition to be a true end to end CBRN Ensemble provider. The Department of War Mask Upgrade is a compelling performance enhancement improving their combat effectiveness and will create export opportunities on the back of that program. Alongside that, our lightweight exaskin suit is reducing thermal burden, improving mobility, and allowing operators to stay effective for longer in the demanding combat operations that they're in. This is the type of user innovation that our customers want. And worth saying for the past two years, the user community has voted our suit the number one most wanted CBRN capability during their experimentation events.

22:47 We're single source on The US hood mask interface program, and that builds their Ensemble integration capability. And actually this week, we we won the CBRN innovation prototype award for that HMI solution from the Department of War. So altogether, the pipeline is building real depth across our ensemble, and we're doing this in direct collaboration with our customers. The business has got proven execution, some deep customer relationships, and a very, very clear pipeline means it's well positioned to outperform the market and deliver sustainable medium term growth. I'll hand you back to Joss to talk about team Wendy. Thank you very much, Steve. Just if we just go back a slide, actually. It's worth touching on this slide.

23:33 This shows the Artemis two astronauts and their rescuers and all of them are wearing our pump helmets and search and rescue helmets. That is obviously absolutely excellent for our credibility and very good publicity for us. One of the things that we don't maybe talk about as much as we should is we actually sell more bump helmets and search and rescue helmets into the Navy and search and rescue teams than we do ballistic helmets. And as we'll see in a minute, we're actually upgrading our portfolio there. In our core ballistic and bump portfolio demand for IHPS, we see continuing in its current format for several years to come. We're expecting more orders as we go through the back end of this year.

24:25 ACH demand remains very strong. We see at least the next six years with the continuing requirement from the US Department of Defense, and we do expect more orders during this calendar year. And the pads that go into our helmets and other people's helmets, we continue to see strong demand there as well. In the commercial area, the new RifleTech helmet continues to get a lot of interest. And the Australian contract is performing strongly. We expect more orders under that framework contract this year, and actually, we expect a new framework contract to be signed last last in the next five years. And the turmoil in The Middle East is driving some demand for us. We've actually had a an order for our brand new Endurance helmet.

25:21 Well, our Middle Eastern customer's already ordered 400 of those, and we haven't even launched it yet. So that's a good sign of things to come. This is our new Recon helmet. Unfortunately, you can't actually see how cool it is in this slide, as well as you can in real life. It's actually a, hybrid construction of carbon fiber and polycarbonate that makes it light and also enables it to have very high impact protection. It's the first helmet we think of its type that is able to meet the blunt impact protection standards under three different certification requirements, under combat, mountaineering, and whitewater. And that means that officers like the one on the right of this photo will no longer have to carry two helmets when they go on a mission. In this case, he's got our bump helmet, which is combat rated, and he's got someone else's helmet for climbing up a cliff once he lands out with his helicopter. But that obviously doesn't make a lot of sense in our new helmet. It is designed to solve that problem and will in turn extend our addressable market size.

26:37 This is our new Endurance helmet. Also, shame you can't see it in real life, but you have to take my word for it that it looks great. This is a lightweight ballistic helmet. It's the type of helmet that SWAT teams would use. It has sold well historically, but it did not have our new and proprietary no through hole system, which means that the rails that you can see in both photos actually, on on everyone else's helmet, those rails are attached by bolts that go through the helmet. That creates a weak point in the helmet, and we have demonstrated with competitors' helmets that if you shoot the helmet near to those holes, the bullet can go through.

27:27 We also know from extensive real world scenarios that if a bullet goes through the shell, it is extremely bad for the user. So we design our helmets where we have bosses that the rails screw onto and we don't create a weakness in the ballistic properties of the shell, and we've upgraded this helmet to that technology. We do expect it to sell well going forward. So we will we will launch it later this year. Although, as I mentioned, we've actually already got an order of it prelaunch. This is our contract portfolio on the helmet side. IHips, we expect to run through to the end of twenty twenty eight in its current form, and then for sustainment to continue after that.

28:17 We are already working on the third generation of helmets with the Department of War, and they have ordered a 100 of them, of our RifleTech helmet, which is our commercial rifle rated helmet. They've ordered that so they can do trials in the desert to see whether that might be suitable for the third generation. And then beyond that, we are actually working on an even higher rated helmet that can stop some of the newer ballistic threats that we're seeing in Ukraine. And we are ordering a very large press to start running trials on that. We are also working with the US Department of War, funded by them actually, on integrating data, night vision and power onto the helmet to make a complete helmet system.

29:10 That may one day involve making respiratory integrating respiratory protection with a bulletproof mandible as well. The US Air Force continues to buy XPEL. We may see them moving to IHIS in the future. We continue to supply pads and we are expecting we have been told, in fact, that the Australian contract will be extended all the way through to 2030 and beyond. We are interested in applying our proven skills in improving businesses to other businesses. We would be looking at things in our area. We we sort of see it in two ways.

30:01 We would like companies that help us accelerate our strategy. For example, if we can accelerate our suit development program through smaller bolt on acquisitions, we'd be interested. We'd also be interested in other companies in a similar space to us that we believe we could apply our recipe for improving businesses to improve them, if we could deliver the same kind of margin improvement that we've seen in our existing businesses over the last three years, we would be confident in creating shareholder value. That said, we don't like overpaying. We'll be selective. If we can't find something that we think we can improve and find shareholder value, there is a capital allocation policy in our results deck that shows that if there is spare capital, we'll return it to shareholders.

30:56 This just shows our performance over the duration of our strategy, including the last twelve months. You can see that over the last twelve months, we've actually delivered our revenue growth targets, our margin targets, our ROIC targets, and very nearly deliver our cash conversion target as well, and we've delivered in fact, we're actually better than our leverage target. That does mean that we've delivered all of our targets apart from missing cash conversion by a fraction, eighteen months earlier than originally planned. So in summary, we're doing what we said we would do. In fact, we're doing it faster than we originally said we would do eighteen months earlier than expected.

31:45 We're in the final year of transformation. That does mean that cash flow is set to improve next year as the transformation programs cease. We're increasingly confident in production rates in Cleveland and margin expansion in Team Wendy. Our strength in the system goes from strength to strength and is delivering in all of our factories, and we are increasingly focused on investing into growth for the future. So with that, we'll hand over to questions. Perfect, guys. If I may just jump back in there. And thank you very much indeed for your presentation this afternoon. And ladies and gentlemen, please do continue to submit your questions just by using the Q situated on the right hand corner of your screen. But just while the team take a few moments to review those questions that have been 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 dashboards.

32:44 Guys, we have received a number of questions, and thank you to all of those on the call for taking the time to submit their questions. But if I may just hand back to you to read out those questions and give your responses where it's appropriate to do so. And if I pick up from you at the end, that'd be great. Thank you. Okay. I'll read out some questions. So in the current market climate, are all defense stocks too expensive, or are there potential acquisition opportunities that look enhancing for you at their current price? I don't think we see all defense stocks as too expensive. Actually, don't see our own stock as too expensive. I I think it is going to depend a bit on the the sale process. We do see private equity driving the prices of some companies up to high levels.

33:30 I I think if something was very dilutive or not accretive to us because it's rated higher than us, then we would clearly think very carefully about that. And related to that, what particular characteristics are you looking for in m and a? Well, I think our our baseline is that we want the return on capital to be higher than our cost of capital within three years. We do believe that in many cases, our improvement system would enable that to happen. People can see how much we've improved return on capital in the businesses that we we took control of three years ago. And we would as we mentioned previously, really, we would be looking either at bolt ons that accelerate our existing strategy or businesses that are close to our existing space.

34:24 As Team Wendy scales, how far can margins realistically progress and what is the steady state? That's a good question. I mean, Team Wendy margins in the first half of 5.4%, that doesn't really give the full story of what was going on in the first half. As we were ramping up production in the first quarter, we were taking on all the employees we needed to hit the higher production rates, but we weren't hitting the higher production rates. And so actually, Team Wendy was loss making in the first quarter, but was materially more profitable in the second quarter. Team Wendy is quite sensitive to output rates. And and actually, as we went through February and March, the level of profitability in Team Wendy was significantly closer to the group average than you might expect.

35:14 I wouldn't I wouldn't necessarily encourage you all to model it staying at 15% for the rest of the year, but I think the consensus has us at around 10% for the full year for Team Wendy. I think that's appropriate. Can you describe the share register UK versus US percentage? And is there a shift to US investors? You can answer that one. Yeah. So there's around 20% US investors on the register at the moment. We do also have a large shareholder that's actually based in Spain. The predominantly the most of our register is based with UK small mid cap funds as you would expect. And as we've moved into the FTSE two fifty last year, we had a higher number of index funds that were buying into the FTSE two fifty stocks as well. It's worth saying actually on that question that we are very relevant to U. S. Investors.

36:08 70 of our business is in The U. S, 70% of our revenue is generated in The U. S. One way or another. And actually, when we get the opportunity, we go and speak to U. S. Investors and we always fill the slots available. So there is certainly interest on that side of The Atlantic. Yeah. It's really a US business listed in The UK for historic reasons. Yeah. And as we get larger, we're starting to get more relevant. Liquidity is always a problem with UK small, mid cap companies and US investors. So as we get bigger, that will start to help. Another question, brilliant progress. Thank you. To what extent does the erratic nature of US administration and congress affect your ability to achieve stock turns and cash conversion you seek now your improvement programs are nearing completion?

36:58 That's a good question. Yeah. It's it's been painful in the first half, particularly in team Wendy because the the way our contracts work is we produce a lot of, say, 1,300 helmets, and then the government comes in, inspects the lot, and then they randomly choose, helmets that get sent to a government lab. That government lab was shut, which meant that we couldn't ship any lots during the government shutdown, and that does definitely slow down inventory times because it lengthens the time between completing the lot and sale of the lot to the US government. We hope we've seen the back of US government shutdowns, although nothing can cease to surprise us.

37:48 However, in the second shutdown, the lab was actually deemed essential, which meant that it didn't shut down in the second government shutdown. So I think there is hope that if there are further government shutdowns, the lab that we rely on, really the Department of War relies on, will stay open, and that would increase the velocity as we would look at it from lot completion to payment. I mean, it it's it's actually an excellent question because what we really care about with it, as as I was explaining on the cash conversion point earlier, you know, we we never try and land the balance sheet on a six months at the end of a reporting period. That's not a particularly effective or efficient use of our time. But what we do care about is average working capital.

38:34 And as Josh said, clearly, if you're making the helmets, but you're you're you're inhibited from being able to deliver them, that impacts your average working capital, which is where value can be destroyed if if if we're not careful. So it it is an issue that we're keeping a close eye on. Hopefully, we're through it for now, but, you know, up to this space. Gavin, I might need more information on your next question. So the question I've got here is non US production getting closer. I'm not sure if that's raised to tariffs or I'm not sure I understand that. Well, I think we can have I'll I'll have a go. I mean, in we already manufacture masks and rebreathers in The UK and boots and gloves. In in helmets, we only manufacture in The US.

39:25 We do get good operational gearing by making everything in our Cleveland factory. So if we could get higher volumes and make them in Cleveland, then we would love that. However, there are customers, particularly in Europe, that are interested in local production. We don't wanna build a factory that doesn't have any work. But on the other hand, if we could win a program in Europe and it required European production, then we would certainly look at moving some production or a bit of our production to Europe. We we yeah. If there is a scenario where we can mold shells in Cleveland where all the expensive capital equipment is, and finish them in Europe, what we call finishing. Perfect, guys. If I may just jump back in there, thank you very much indeed for addressing all of those questions that came in from investors this afternoon. And of course, if there are any further questions that do come through, we'll make these available to you immediately after the presentation has ended for you to review. But Joss, perhaps before really now just looking to redirect those on the call to provide you with their feedback, which I know is particularly important to yourself and to the company. If I could please just ask you for a few closing comments just to wrap up with, that'd be great.

40:38 Oh, wow. I wasn't expecting closing comments. I mean, I think I mean, three years ago, we set out to radically improve this business. The team you see in front of you and Gabs who's behind the camera, we've we have developed a strategy to improve the business, and we delivered on the strategy to improve the business. And we've actually done it faster than we thought. We're now seeing the business is very well positioned to grow organically going forwards, and we're gonna focus on investing into new product developments and driving growth as fast as we can. Perfect, Josh. That's great. And thank you once again to all of you 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 that the management team can really better understand your views and expectations.

41:33 On behalf of the management team of AVON TECHNOLOGIES PLC, we would like to thank you for attending today's presentation. Now concludes today's session. So good afternoon to you all. Thank you. Thank you.