Bango (LSE:BGO) — Bango (BGO) - Full Year Results Presentation

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

0:31 notify by email when these are ready for your review. Before we begin, I would like to submit the following poll. And if you'd give that your kind attention, I'm sure the company will be most grateful. And I'll now like to hand you over to Paul Laby, CEO of BANGO PLC. Good morning to you, sir. Good morning, and thank you everybody for joining. We really appreciate, taking your time today. Hopefully, you've had some time to digest the the strong set of results we published, earlier this week. And today is all about sort of trying to put more commentary and color around those, especially about what the future has to hold, but also more importantly, I think the opportunity to ask questions. So please, please do, use the q and a facility to ask questions. It's much more much more interesting for us when we're engaged and and sort of addressing the questions that that are really important to you. So without further ado, let me sort of dive into the the highlights. Hopefully, you you saw the strong set of results.

1:21 Revenue of 32%, excess of $20,000,000. Just as a reminder, now what we changed our presentation of currencies, so everything we talk about here will be in in US dollars. On the back of an increase in the pool of data, we have to monetize that valuable end user spend up to in excess of 4,000,000,000. And we did that while increasing EBITDA and generating additional cash flow. The cash was up almost $1,700,000 on last year, and that increasing profitability in cash is at a time when we're also continuing to invest because we see the opportunity ahead of us to capture future growth requires investment now. So we're very much focused on investing for that growth. Matt will talk through more details on that later. But, fundamentally, a lot of our growth is in people. And we're in a very fortunate position of having a very, very highly engaged workforce way in excess of the the tech sector average. We got our record employee engagement score last year. And that means when we're looking to hire and we're looking to grow, we're actually looking to we're hiring for growth rather than hiring for for replacement. Our attrition is, you know, is as close to zero as you can you can really meaningfully get.

2:27 So it's all about hiring for growth, and that's where a lot of that investment goes. And it's going to fuel two key elements of the business is that platform SaaS business, from is is really sort of an inflection point now and and very exciting for us. So adding more capabilities to the platform and also adding more sales. And that BANGO audience's business, which is a completed its second year of trading, demonstrated really great growth, and it's starting to spread out across platforms and across different app genres. So so very certainly very exciting. Just a reminder, we'd like the virtuous circle. If you think everything we do is a very focused around this virtuous circle, it's about connecting merchants who have things to buy, to paying users who have an ability to charge, and we place that charge on a bill that generates payment data.

3:13 We use that payment generator to generate insights that we can help to use to better target the marketing, and that in turn generates more payments and the virtuous circle continues. So while those are the two businesses, you know, the the payments and the subscription bundling business, on one side and the BANGO audience's business on the other, growth in one really fuels growth in the other. And they're connected

3:32 around this, this virtual circle, which you'll see time and time again, throughout the presentation, here this morning. Few KPIs, and then I'll sort of turn over from out the top two are very familiar financial KPIs that you're familiar with, the end user spend growth, the revenue growth. I think a key part of there is the, you know, the shape of the curve. Growth is really what we're about as a company. The two KPIs at the bottom are, properties that we introduced over the last couple of years for that BANGO audiences business because we don't break the revenue out. It's reported in a single segment. And that would allow investors to sort of understand the growth in those businesses. We'll probably stop reporting these and try and find out something else. They're less meaningful than what they were when we started. The metric on the bottom right, the app developers, that's the number of app developers we're engaged with.

4:17 You can see great growth from four to 10,000. So it's getting to the point now where I'd say it's it's it's less meaningful. The metric on the bottom left is a measure of the use of the BANGO audiences on each day in the particular month. And that was really useful as a proxy for revenue early on. However, we moved our pricing model away to where we take a percentage of the ad spend. So we'll take anywhere between seven and ten percent of what you as an app developer spend on your Facebook campaign for the use of that BANGO audience. And so, therefore, it's it's a less useful proxy for revenue than it was previously. But, again, the key message there is not necessarily metric or the shape, but just the shape of the curve in terms of growth and, you know, both businesses, both payments business, platform business, the BANGO audience business really have strong growth and and and even stronger growth potential in the future.

5:06 So with that, I will turn over to Matt, our CFO, who will talk you through the financial results. Thanks, Paul. Morning, all. First of all, just, looking at a graph, some graphs showing revenue and EUS, growth over the the past few years. As Paul alluded to, 32% revenue growth in 2021 from 2020, which was above the market expectations for growth. So another good year for for our our business. Over the six year period, that's a 47% CAGR. So continuing good strong growth from previous previous years. End user spend, up 74% to 4,100,000,000. We use this as a KPI to reflect the amount of monetizable data that we have available for our audiences business.

5:54 And good to see that when that CAGR for for that six year period is is 97%. So really two really good strong metrics on the top line for for the business. All of that's being achieved by good gross profit margins over 94%, which means that we've got good levels of of resource to be able to invest back into the business. And and we've been doing this quite strongly in 2021. We'll continue to do it in 2022 and 2023. So our investments predominantly come, as Paul said, in people, going between research and development, investment research and development, and investment in sales and marketing. So for our research and development, we've been investing in

6:37 engineers for the payments side of the business where we've been working on the platform and also on the platform licensing, which we'll speak more about later on in the presentation, but it involved our our new business deals with BT and with Verizon along with with three other customers during the course of '21. What we've also done is been able to work with r and d r and d effort on the audience's side to make the engagement with the customers as light touch as possible, allow them as much as possible to be able to go through and create their own audiences on the BANGO their BANGO website. So a lot of investment within within that. Also, lot of development for future revenue growth. So good to bear in mind that the work that's going on now is for revenues in two to three years' time.

7:32 Also done, investment in sales and marketing. So realizing we're we're probably a little bit light on our our pick people on the ground in, Asia. We've looking to invest in there specifically as well for the audiences market where there are a lot of app developers prevalent, in the field there. Also looking as part of the platform licensing deals that we're now engaged on, different type of salesperson required with a a long incubation period between discussions and conversions into contracts and revenue for this SaaS based business that that we've now got from the platform licensing, predominantly in North America, the investment coming into place there. So that's the ability to be able to do that and the increase in our operating cost driven by the good margin. At the same time, enabling us to continue to increase cash, which allows us to fund that own fund that investment through our own cash rather than having to go back out to markets and potentially dilute our shareholders.

8:30 So we've been able to create that that that source of of investment. Little bit more detail on on on some of the costs and where those costs have gone. As you can see, our fully administrative expenses, which includes the share based payments and depreciation and amortization, is up 5,240,000 of that being if you exclude those those those two items from there. Bottom graph showing our internally generated intangibles. That's the work that our R and D teams do to improve the platform. And you can see there from two thousand eighteen, nineteen, twenty, the increased investment in developing those intangibles to drive future growth.

9:17 Just reflecting that also in cash to show the fact that our op our cash from operating activities is sufficient to cover the cost of the investment that we're doing in in the platform while still growing our our cash flow. And, again, just as a reminder that this is BANGO cash flow. There's no debt related to that, and it's our cash flow as opposed to the cash of any transient business from our customers. So purely cash available to us to use as we think sensible to drive forward the business.

9:49 May you be aware obviously where that we have now presenting our our finances in US dollars. Our presentational currencies changed this year. We thought it'd be useful to have a bit of history to allow people to follow the trends through in US dollars. So here's our our restatement of the last few years' worth of of accounts just on some of the key areas of revenue, gross profit, admin expenses, and adjusted EBITDA. I think one of the items to to look at and just consider on here is the the associate loss during the course of 2021. This is coming from, you may remember back in 2018, we acquired a company called Audience in Italy, which we acquired in order to get some IP to accelerate our growth. We took that IP out of the business of the Audience business and put it into BANGO, and we're left with a business that was noncore to BANGO, but still had a lot of interest.

10:45 NHN, who's a North Korean company who from whom we've previously acquired some credit card data for the audience business were interested. As part of that, they took 60% shareholding in the, in the audience business, which is now called New Deep. And at the same time, 4.7% stake in BANGO PLC, which is just last or just the other week increased to 11%. Now this is a company that there's been a lot of investment initially. They've started to generate revenues at the end of last year, and this, has a very good opportunity with working with Shopify. So we're looking to expect that loss to decrease as their revenue start to pick up and their business starts to to increase. I think what's important to realize is that if there is further funding and it is well capitalized at the moment, if there is further funding, we are not it's not gonna come from BANGO.

11:42 And NHN are aware of this, so if there's any more investment, it'll come from NHN. Now that might reduce our percentage down from 40%, but it'll be a less percentage of a a greater worth company. So just rolling all of those financials from this year into into our virtual virtual circle. If you look at the top, our our increase in end user spend of 1,700,000,000 gives us that more valuable data to monetize, which has then driven that 32% growth in high margin revenues to increase our EBITDA. Our EBITDA has allowed us to generate cash at the bottom, which then allows us on the left hand side to increase our investment in growth and future growth to again drive the top level of the of the virtuous circle and increasing EUS and revenues.

12:30 I'll hand back now to Paul to talk about the operational highlights and outlook. Brilliant. Thanks, Matt. So try to put some of the things that happened in '21 together and and put into context what it means in '22 and beyond and and talk about some of the the the the the future outlook. I think this is a slide you're you're hopefully very familiar with. It's been the formulas driven that payments growth, that 47% CAGR that Mike talked about. We're connecting, you know, more users via more routes, giving them more things to buy from more merchants, and using that data in the platform to help those merchants really succeed. That's something we've always been a big part of our our platform and our payments proposition, and it's really differentiated us in the marketplace. Lots went on last year. I'll sort of choose a few examples from here just to highlight. The first example I think is we're talking about is sort of the our use of partnerships now to expand further. We had, you know, 30 or so connections in The Middle East, Africa, and Turkey.

13:23 The global merchants connected into the platforms with an acceleration of of those payment connections. So we looked at whether we should do those directly ourselves or we should find a partner. And the end, we decided partnering with the leading, integrator in that region, TPay, was the right thing to do. And so by doing one connection into TPay, all the merchants in the BANGO platform and get immediate access, in addition to the BANGO route, to the 74 connections across twenty twenty something countries that TPAY have within that region. So a great way of expanding, the payment provider footprint. And very similar with NTT Data, who we partnered with to get increased access to to wallets across Southeast Asia. Wallets are fast growing part of the business and have have been, you know, part of the BANGO business for for many, many years now. That's absolutely something that's not new. But their use is absolutely increasing, and so partnering with NTT data just gave the the increase the breadth of wallets that we could offer in addition to the ones we we did directly ourselves. So you might have seen a nice one we did with Kakaopay, one of South Korea's largest wallet providers to get you know, bring them into the BANGL platform and give the merchants access to to the to that to that payment route.

14:28 Flipping on to more merchants because we do all of this for the merchants to make the merchants more successful. Few interesting things last year. So Microsoft, our partnership with Microsoft continues to go from strength to strength, expanding beyond the store and and Game Pass Ultimate that we talked about probably last year into now with Microsoft three six five. So great progress with with Microsoft. New types of services, pre.com being a good example of a lifestyle well-being service that we added as a merchant. And existing merchants like Amazon with Prime Video mobile edition taking existing content and repackaging it in a way targeted at a specific demographic. In this case, a way of getting people on the Prime Video content via a mobile only device that you can upsell later to Prime as part of encouragement to encourage people to top up.

15:14 One logo that's new on there, which we announced not that only a few weeks ago now is a partnership with Digital Turbine, and that's really focused on this this breakup of the the the monopolies the app stores have on in app payment. So at the moment, if you are playing a game and you want to buy a bag of gems, for example, your only way of paying it is through the play through the the either the Google Play Store or the Apple App Store. Now you may, at the end, then select whether you want credit card or carrier bill or your mobile wallet, but, fundamentally, that's still going through the App Store. Right? So that's starting to disintegrate the number of lawsuits that are going on between different players in the industry. South Korea have actually legislated that that monopoly be broken. We expect that to spread. So with the increasing move in the in the industry to allow and encourage almost out of app store billings.

16:01 And so this means we think the largest app developers will want to engage directly with their customers, offering alternative payment mechanisms for for the content, allows them to not only engage better with the customers, but also reduce some of their costs because they are no longer subject to the 30% or so that the the two app stores charge. Digital turbine is a great partner for that. A large Nasdaq listed company has built a great business about putting apps on phones and promoting apps within within an operator environment. So adding BANGO as a default payment mechanism within apps that that that that the process through digital turbine is a great way of getting those first app developers paying and connecting to to carry billing and wallets and and the alternative payment mechanisms that we support to process payments directly for customers without going through an intermediary app store. We'll hopefully see the first early launches of that later this year or early part of next year. And while it's not gonna be meaningful in terms of revenue in the in the next couple of years, it's certainly a trend that we see increasing, and and we we expect that to to sort of further accelerate the payments business in in the later years.

17:05 The nice thing about that is a lot of these app developers that we're talking about are already customers because they're using our data monetization, the BANGO audiences, to help them better target their marketing. So, again, you really see the the sort of the two halves of the virtuous circle continuing to support each other. I'll go through this in detail where you can see here a testimonial from Microsoft. There's videos from from Greg who's a telco channel leader in Microsoft on our our website. The very strong relationship there, and it gets gone from just from strength to strength and adding three six five as the latest, and we're helping them find more customers for these offers and and roll out these services. So a really, really strong partnership with Microsoft and one where we're we're really pleased with how it's developing.

17:47 A lot of what we're doing for Microsoft is about helping them bundle services with telcos in particular. It applies outside of telcos, but the telcos is the predominant market at the moment. And the reason that's of interest is because of sort of this this jigsaw puzzle you see here where with the telco, they've struggled historically with the lack of first party differentiation. So, you know, voice is voice, data is data is brought to broadband is broadband. So, historically, what they did to make that more interesting for customers was to acquire content and build TV their own TV offerings to put on top, and that's incredibly expensive and now increasingly difficult to do. And it's difficult to do because we have lots of big OTT guys who are buying lots of content, producing their own original content, and trying to market that to customers.

18:32 But they're struggling not because they're not growing, but because actually their growth rate is slowing. And, you know, you can see in some of the publicly traded companies when they did report a declining growth rate, you can see what that does to their stock price. And they and that's why they're trying to maintain a growth rate in an increasingly competitive market. So they're also looking for new customers, and the great thing that telco provides is an established channel, an established distribution channel for customers, established customers with whom each of whom they have an an existing billing relationship and the ability to market to that to that customer base. So by partnering with the telco, the OTT gets access to this this ready made customer base, a partner who's ready to market, and an existing billing relationship. So it's really, really good for the OTT provider to partner with the telco. And if you talk to any of the OTT guys, what I'll tell you is that there's a subscription that's bundled with the telco has a much lower churn rate than somebody who just pays by credit card on a month by month basis.

19:22 And what the OTT guys give to the telco is a really exciting brand, some really exciting content that makes the first party services just look more interesting and allows them to better market those first party services, and encourages the takeover of the first party services with these third party offers that are now part of that package.

19:40 So a couple of really specific examples of this. This is from BT. The slide on the right is from their investor deck. You can see the the importance of partnerships as part of their overall offering. And on the left, what you can see is the importance of connecting the first party services at the top of the page with the third party services at the bottom of it. Netflix, Microsoft, even known utilities from antivirus and securities and identity protection, all can be tagged on to within a first party services and, and and and used to sort of not only capture new customers, but to retain existing customers and at the same time generate revenue.

20:16 This is this entire concept was illustrated very well only a week or so ago, at the Verizon, Investor Day. There's a link to the video on the bottom of the slide. If you watch that about one hour thirty five in, Mano, who's the, CEO of the consumer business, talks about the launch of a new service that they've called PlusPlay, which used to address this this pain that we all feel by having so many subscriptions spread across so many credit cards and so many different places that really we we're struggling to understand what we've got, how we sign up for new ones,

20:45 and and really what we're paying. What they've done with this plus play is is go to create a place where you can do all that in one place so you can easily discover, purchase, and manage content across all sorts of different genres from entertainment, the likes of HBO, Netflix, Disney, usual audio streaming services, you know, title, these are Amazon gaming services like Microsoft, FitBot Fitness like Peloton, and lifestyle like, you know, Duolingo and Weight Watchers. And you hear that you can get all of these in one place

21:14 is a really valuable consumer proposition, and they're doing that to increase loyalty for customers and at the same time generate more revenue. So exactly the same challenge that they're, you know, publicly talking about that I sort of I sort of mentioned earlier. And this is all powered by the BANGO platform as is BT. And if you look what we do, I think a nice metaphor for what the BANGO platform is. It's almost like where the BANGO platform is a vending machine. And it's a vending machine that's stocked with every conceivable solar digital subscription,

21:43 And the operator is responsible for stocking the machine, understanding what goods they put on which shelves, if there's any offers around if you buy multiple multiple goods, how you pay for those services, and what the vending machine looks like. So that's the role of the operator. But the mechanics of managing those subscriptions, of distributing those subscriptions, of keeping track of those subscriptions is the BANGO platforms. That's really the heart of the the BANGO technology. So the the vending machine analogy, I think, is a nicely describes the the business and and how the business is evolving from a platform perspective.

22:17 Just to try and put in context, this is a a very different business revenue profile than the historic payments business. So we thought it would be useful to try and explain that a little bit more because there are three components to the revenue, none of which are directly linked to end user spend. They all have a growth element, but they're not linked to end user spend. The first is just an integration fee. That's just a setup fee. Nothing too exciting about

22:40 that. The Zen generally appeared of quiet so that if you look at the graph on the right, the purple bars are the in month revenue, and the pink bar is the entitlements that the platform is managing. So we do a setup. We're not managing any entitlements. There's been a natural pause while the operator does what they need to do to launch the service, to brand it, to market it, to push it to their customers. And in the monthly launch, which I show in sort of month eight here, we start to generate a license fee. And the license fee we charge is a tiered license model based on managing a number of entitlements. If it's a subscriber, you have three subscriptions, you count as three entitlements. So it's not the number of subscriptions. It's the number of entitlements. And you can see in month 80, we get part of that, and we also get a percentage of that as a maintenance fee. We get full month in month nine, so you can sort of see a slight step.

23:28 And then as the number of entitlements grows, they cross through that tier, maybe from 1,000,000 entitlements to 2,000,000 or 2,000,000 to 5,000,000. And that that that and that point, you get a step increase in our monthly revenue as they move into the next license tier, and that keeps them going for the next sort of two or three months. And then in maybe month four or five, they might step up again. So you can see the profile of the revenue is very different, but I hope you can also see that once we get four or five or six and tens and twenties of these deals coming together, then the recurring revenue starts to be meaningful, especially in the later years. And as we talked about on the the strategy day, you know, the five contracts that we have of which one is BTU and one is Verizon, those are the two that we've announced publicly. We expect those to be generating $7,000,000 of annual recurring revenue

24:14 by by 2023. So really strong opportunity, and we we have a nice pipeline of business that follows those strongly behind. And that's contributing to our growth in energy to spend as is the growth in the payments business, which is really helping fuel the growth in in data monetization and the the BANGO audiences business. And if you look at how it started, it started very much in games. If you've seen the videos on our website, we talk a lot about games. A lot of our case studies are are from games developers. And because they they really struggle with that challenge where 80% of their revenue comes from 5% of their users. But more and more, we've seen that evolve into social casino, health and fitness, sports. And one of the examples I give later is about NFT sort of trading sort of application. We also have a crypto trading app who's using purchase behavior targeting technology.

25:03 And if you think of a games developer, generally a games developer will take an audience from us that is strategy gamers in Taiwan, for example. What the trading app's looking for are people just who have disposable incomes or high spenders who can make that first time deposit. So a different slice of the data, but they're still resulting in the same benefits from targeting based on purchase behavior. What's interesting is as we start to get to the edge of the app market, how we're potentially pushing into other markets, and we have a very large retail brand who is a customer who engaged us initially to help us promote their health and fitness apps. They have a sports tracker slash running tracker application, and they wanted to find paying users for that. But they soon realized it's just part of that marketing campaign that actually the data we're providing them to find those customers is really valuable in general ecommerce and retail marketing.

25:51 Because the rationale being if you spend a decent amount on a on a fitness app, you probably spend a decent amount on running shoes as well. So we're right at the edge of sort of testing and finding customers who have both an application that we can help market, but also more retail goods. And, clearly, the the size of the retail marketing budget that we could tap into then is just is just potentially fast. Data is obviously an important part of it. You know, the data we get through our own end user spend, also but credit card data that we bring in from other sources. We spend a lot of work to make it easy to bring data into the platform and combine it with the data we have, whether that's credit card, whether it's from other app stores, whether it's some attribution networks. And we've to pull all that together into one place and make it available to the app developers across multiple platforms.

26:36 So historic Facebook was a lot of the spend. TikTok, one of the fastest growing platforms. Still small relative to in size to Facebook, but growing very fast. And there'll be other platforms we'll look to add as as and when demand requires it. And Matt touched on this earlier, but a lot of that r and d that we're investing in this platform is to make it more self serve, to make it more automatic, to make it easy for our developers to use, make it easy for us as a business to scale because it's now not connected with people. And also to here, we can generate more value from the data we have. So generating, you know, better audiences, better insights from the data we have, and combining that multiple datasets together in more innovative ways. So lots of lots of opportunity there to to further deliver more value to the app developers. Again, because we changed the pricing model in '21, I thought it'd be interesting and useful to maybe go through the sort of revenue profile from an app developer.

27:28 The way we charge for this is as a percentage of ad spend. So if you spend $100,000 a month in advertising Facebook, we will collect somewhere between 7 and $10,000 of revenue for allowing you to use BANGO audiences. Now the way it works is there's a minimum fee, is generally around $2,500. So when our developer comes in, they generally, you know, spend relatively low amounts for a number of months while they're testing the purchase behavior targeting work because it's a relatively new concept for most of them. Most of them have never used purchase behavior to target before. So there's several months of testing, and then start to see it works. They do some broader trials, so they cross beyond the minimum threshold, and we start taking a true percentage of their ad spend. Then they move into the it really works so they're gonna run the campaign, and they plow money into that campaign. You can see a peak in revenue for the the two months where the the campaign's active.

28:16 The campaigns are active for different period of time, some for a few weeks, some for many months. Depends, you know, if they're based on an event or a specific promotion or a specific set of creative. There are all sorts of factors that determine the the length of a campaign that will naturally ramp down over a period of time. Sometimes there's then a pause, and then they start a new campaign, some early testing of that campaign, and then they invest in in in in earnest in that campaign. So you see you get this wave function that cycles through. And while the, you know, the lengths of the troughs, the size of the peaks, the wavelength is different on each of the app, different app developers, they all generally follow this sort of trend. Track developers that are very much on that on that trend in the cycle is is Upland and Manta Comics. Upland is that metaverse NFT trading game that allows you to buy and sell virtual properties that are mapped to actual actual addresses. They're using it to find, you know, paying users for their app and having really great success in their in their Facebook campaigns.

29:16 The Manscomic too is a South Korean company, web comic app that's trying to find new paying users in The US, and they're interesting because they're running campaigns simultaneously using exactly the same BANGO audience, but on TikTok and Facebook at the same time. They're clearly different creatives because the the advertising creative you need for TikTok campaign is very different than Facebook, but pairing both of those is the same BANGO audience to help them find paying users. If you go to bangle.ai and read the case to you, you'll see that the Manta comments only regret is that they didn't start using BANGO audiences earlier. And the reason that they have that regret is because partway through 2021, there was an apocalypse. You may have missed that. There was so much going on last year, but this is a an extract from our latest marketing campaign to raise brand awareness with the app developers. Because in effect, in iOS 14.5, Apple took away what's called IDFA or app ID tracking, which was a big source of data that app developers used to target their ads. So overnight, the traditional way of working didn't work anymore.

30:15 They couldn't they couldn't measure, couldn't measure performance, they couldn't target ads. And so there's a big disruption in the entire app marketing ecosystem last year, which when the dust settles and the apocalypse ends, the people that survive are the people that really know find alternative ways of targeting users, that's through BANGO audiences and pay and purchase behavior targeting. So that sort of market change, which sort of disrupted the entire market, is absolutely a tailwind for us as a business, and it's it's helping us grow that business even faster. Because all those app developers are finding the soft metrics that they have access to, like search and like, don't work that well anymore, and what they really need is a really hard metric like purchase behavior. And so we think that's the next the next evolution of of marketing and and really what we're focused on.

31:03 So when you put all that together, you'll see me talk before about this journey from tens to hundreds. We're clearly in tens now. We did over $20,000,000 of revenue this year. The ability to reach hundreds is not a case of if, it's a case of when. Drive being driven in three directions, a transactional business that will just continue to grow the traditional payments business. We've historically grown at twice the market rate. This potential of the out of app store billings or engaging directly with the app developers, the digital turbine relationship I talked about earlier, the potential to further accelerate that business. We have this platform business where we see we have these those five customers now that will be meaningful ARR in 2022 and even higher in '23 and beyond, but we have a really strong pipeline of customers. Then on top of that, we have the BANGO audiences business, which has just finished its second full year of trading in 2021, showing some great growth across multiple platforms now with Facebook and TikTok, expanding into different app categories. I'd say we're right at the edge of sort of pushing beyond just app developer marketing to that broader digital retail marketing budget.

32:05 And when that happens, then the potential is is truly huge, and we we think, well, the the that BANGO PLAYMENTS business will exceed the BANGO payments revenue. It's just a quick say a question of of when, not if. So when you put all that together, I think a strong a strong year. We're pleased with the results, but, you know, we're more excited about the opportunity ahead. And that's why we chose for, you know, the next last year and this year and and into next year to, you know, accelerate investment to make sure that we're well positioned to capture that growth, that we know is coming across that platform business, and the purchase behavior targeting. So with that, I'll stop there, and we'll Paul. Switch to some q and Matthew, Anul, thank you very much indeed for your presentation today. Ladies and gentlemen, please do continue to submit your questions just using the q and a tab that situates on the right hand corner of your screen. But just while the team take a few moments to review those questions submitted already, I would like to remind you that a recording of this presentation along with a copy of the slides and the published q and a can be accessed via your investor dashboard.

33:07 Rebecca, as you can see, we've received a number of questions throughout today's event, and thank you to all investors submitting their questions. If I could hand back to you and if you could propose the questions to the team, and I'll pick up from you at the end. Thank you. Brilliant. Thank you. Yeah. One of the questions in is about the growth rate from h one to h two and versus sort of the growth rate achieved in 2019 and 2020. And if you could just talk a bit about sort of the the change that it looks like perhaps it might have slowed from h one to h two in 2021. I think I think what's changed is that the business has multiple elements to it that it necessarily did before. And it when it when we were just a payments business and h two was always bigger for two reasons. Firstly, there's a lot of one off spending events in H 2, Christmas, you know, Amazon Prime Day generally falls in h two, Black Friday, Cyber Monday. But also in H two, by default, you get, you know, a bigger portion of revenue because routes that you launched in the first half, which probably contributed close to zero in the first half, you get a full six months of revenue in the second half. And and and the the existing routes that were there, you get you get even even more growth from those routes. So that was what always drove that h one, h two balance.

34:09 As we start to add in BANGO audiences and the purchase behavior targeting, the the profile for that business is very, very different. For example, spend around Christmas tends to be lower because marketing costs in Facebook go up. So app developers spend less on marketing in December, which is the peaking payment. So the cycle of that business is very different. And then when you add in the platform business, which is this integration fee and the SaaS fee, you can you can see that's completely not connected to a half one, half two. So the the half one, half two split that we've historically been, which is sort of forty sixty was a lot closer to fifty fifty this year. We'll see how that will evolve over time, but you can you can hope to see why that we're nowhere sort of there's multidimensions to the business. It's not just sort of a pure payment business. Right. Thank you. And then on the, platform licensing business, would you be able to talk a bit about verticals outside of tel outside of telcos where that would work?

35:02 Yeah. I think I think there are a number of verticals outside of telcos where it work because you can see how the we've got there with the telcos. We got there by bundling one or two point services with a particular telco, which then they got to the point and said, hey. We now wanna do five and ten services. Can you help us do those five or 10 services? And and the answer to that is our our back our our vending machine, if you like, the the the BANGO platform underneath that. So that's how that's progressed. And if you look what we're doing as in other verticals, we're doing the same, but we're probably a few years behind. So in retail in The US, we have a couple of retail, customers in The US who are bundling subscriptions with a store card, for example. So there's potentially natural migration is for them as they add more services to move to a platform. I was in financial services, so people would bundle payments together. So there are many other verticals that would that could move into platform business. The telcos just happen to be very advanced in terms of service bundling generally.

35:55 Having historically bundled first party services together, you know, triple play, quad play, for those who've been around long enough is is an old telco mantra mantra about bundling. So it will evolve, but it will evolve over time. But, basically, anybody who has customer contact, established distribution, established billing relationships is a prime candidate for the OTT guys to talk to about bundling services and therefore a potential customer for BANGO. Thank you. A question on the loss associated with the new deep JV. I just wonder if we can provide any more color on that. I guess maybe worth clarifying sort of the details of the JV as well before going into that. Well, on on the financial side, I think the part one of the questions was the or observations was the loss had tripled. I think, obviously, the twenty twenty numbers were only part year because the JV only started off partway through 2020.

36:44 Going forward, we we know that the as I as I mentioned earlier on, the revenues have just started to come through, so we expect to see those losses reduce and eventually turn around into a profit. I think Annal's probably got a bit more detail behind the new deep venture as it as it goes. Yeah. I mean, we we that that business is very much in an investment phase as well. We during the two years that we thought that since BANGO acquired it in 2018 to when we divested in 2020, we we moved the business on to focus very much on a customer data platform proposition for online retailers that were scaling up. And there's really interesting technology developments that relate to massive merchant platforms like Shopify, for example, that's the this platform will lend itself to.

37:32 So, you know, merchants who set their shops up online on on Shopify want to be able to use their data to target their marketing offers more effectively. There's no inbuilt tools in the Shopify platform, but the audience platform is really, really powerful for that. So there's been quite a lot of investment over the last year to to build those tools so that we can hit platforms like Shopify and reach merchants at scale rather than on an individual merchant by merchant basis. Thank you. And then then maybe one for you, Matt. We've just you touched on it briefly earlier, but the a question on the move to reporting in dollars and the decision behind. K. We we took the decision to move our presentation currency to US dollars. Now, obviously, there's a differentiation between presentation and functional currency.

38:18 We changed our presentation currency because we're seeing a lot more of our revenues coming in from The US from The US. But also, it's from a presentation perspective because we're looking to attract further investors. Publishing in US dollars is is makes things easier for The US investors who struggle sometimes to to translate currencies other than US dollars, whereas we know peoples in The UK are quite adept in changing from US dollars and euros into sterling. So from an interpretation side of things, it could help for a wider market. A question now just on the the last slide that you you you brought up, and, obviously, there's not a timescale on that graph. And whether you could comment on sort of the likely timescale of of that group. Yeah.

39:06 Yeah. Good. So there's deliberately no timescale, and then I think you remember the time I said it's a question of of sort of when not if, and I think that's that's that's the big question. And we're we're we're investing now to to get to that point as as fast as possible. We think the opportunity is there. We've been, I think, deliberately cautious in terms of the numbers we've put out into the into the market. Yeah. The market certainly much prefers a a more conservative number that you can beat. So we've tried to sort of on the on the side of caution because in that especially in the platform deals, are several aspects outside of our control. Sales cycles are a little bit longer. You saw on that revenue profile graph that this, you know, the from the point at which we win a deal to a point in launch service is entirely out of our control, and that that piece of the the vending machines there in the shop, and it's sitting idle waiting for somebody to turn it on and and stock it full of goods. So there's only elements I've said, think we've deliberately cautious, but we're very optimistic about the future.

39:55 So our our goal is to get there at at the quickest possible rate. I'd say I I think it's really a question of when or if, and we're certainly investing to to accelerate that. And, obviously, we'll keep you updated as we progress down that journey. We'll make a comment as well, Rebecca, on that. Think the the other interesting thing to take away from that slide is the composition of revenue as you move out towards the future. So what we're anticipating as well as well as the scale of revenue, hundreds of millions of dollars, If you look at that slide again, you'll see the composition of the revenue is spread across all three core businesses, but it's shifting towards the data monetization that becomes the dominant revenue generator as you look out in that that period of time. I think I'll just doing a simple bit of back of envelope math as well. If if BANGO only grows at historic rates of growth, then we get there in about five years. That's assuming that we owe do no more than our historic rates of growth As you'll have hopefully gathered from the presentation, we've we've geared up to be able to grow much faster than that in the future.

40:57 Thank you. A question on whether you can comment on any exposure to the economic recession. Yeah. I think first one, the money is sort of the especially on the payments because there are two areas we don't process payments in, and that's all been much in China. So the the current sort of turmoil that's going on where we have really no exposure to. The broader recession, I think what we've seen in areas like COVID and in terms of that, that generally, drives people to, you know, change what they spend and and change how they spend it. But I see the nice thing is we have such a breadth of different services from groceries to well-being services to educational services to entertainment services that were very well spread as as people sort of change what they spend their money on during different sort of economic circumstances. So I think we're very well positioned to wherever that in terms of sort of operational leverage and and moving forward. I think we've always said that this business tends towards a 50% EBITDA model in in the long term. We're in that sort of midterm where we're investing for growth. That means that's slightly compressed, But that's really where the leverage is in the platform is when a lot of that top line growth drops straight to the bottom line, particularly as the BANGO audience's business, which is largely self serve and a very little touch business, really starts to to kick off, and and we're generating more and more revenue from that same source.

42:09 One quick thought, Rebecca, on on that question about exposure to economic recession. One of the things that typically happens in in recession cycles with with advertising is, first of all, advertising budgets shift to digital. So so they move even more quickly from offline to online. That happens in 2020 when when COVID lockdowns first first happened. If if that's the case and that becomes a tailwind, then then, obviously, anybody who's offering technology and data and digital marketing could potentially benefit from that. And the other thing as well is is as people start to have to think about how they put their marketing dollars to work, then you get much more of a focus on what's generating revenue, what marketing investments actually generate revenue.

42:54 And that's clearly where purchase behavior targeting is a very, very strong play. We think in any case, digital marketers are moving more to that line of thinking, but I suspect if they have to become more thoughtful and scrutinize the return on their ad advertising dollars, then the purchase behavior targeting business really becomes even more important. Thank you. And then lastly, just whether and listing on Nasdaq is something that you would consider. Yeah. I think it's a it's a natural question. I guess if you look at the profile of the company, the The US market is is is much friendlier and and much more receptive to the growth tech stocks in particular, where the market is is very much more sort of value dominated. I think at the moment, we're very happy with the list of them. We are getting increased inbound interest from US investors. That's one of the reasons, as Matt mentioned, we changed the reporting in US dollars. It's also another reason that we listed on the OTCQX market, which allows BANGO to be traded during US trading hours with a lot lower risk profile and access from investors to much more information about the company as a result of that that listing on OTCQX. So we see lots of interest from US based events investors.

44:03 But, say, at the moment, we're we're we're very happy with our our list on AIM. We think there's a incredible potential for the company and therefore incredible potential for shareholders. A quest a question on with the variety of spend that we have in the platform, whether there is a way to sell data to governments? Yeah. Good question. So firstly, we should we do not sell data. So the one thing we do not do is sell data. We make data available for use in digital marketing platforms, such as Facebook and such as TikTok. So any government that's running Facebook and TikTok campaigns, absolutely, if they're looking for spenders, we then can we can certainly help with that. But, no, we don't we don't sell data. We're not a data company. We're a company that processes payments, collects purchase behavior, targeting creates audiences of users from that. We allow people to use, but we absolutely do not sell data.

44:54 Great. Thank you. And that's it. The questions I've had come through, I think. That's great. Thank you, Paul, Matthew, Anil, Rebecca. Thank you for addressing all of those questions that have come through from investors today. And, of course, ladies and gentlemen, the company will have the opportunity to review any further questions submitted today, and we'll publish those responses on the investor meet company platform where it's appropriate to do so. Paul, perhaps redirecting investors to provide you with their feedback, which I know is particularly important to the company. If I could please ask you for a few closing comments to wrap up with. Thank you. Sure. And once again, thanks to to everybody for the time. There's lots of material on our BANGO investor website. We put a lot of effort into that over the past twelve months to put normal blog content, make it easier to find content. So hoping you're you're you're finding that really useful. We really do like, the engagement and enjoy the engagement on platforms such as this. But at at any time, feel feel free to drop us an email at [email protected].

45:43 We'll do our best to, answer your question in a in a timely fashion. We appreciate your support, and thanks for your continued support, and and hope you're as excited about the future as we are. And enjoy the rest of your day, and thanks again for your time. That's great. Paul, Matthew, Anil, Rebecca, thank you very much indeed for taking the time to update investors today. 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 better understand your views and expectations. It's only take a few moments to complete, but I'm sure it'll be greatly valued by the company. On behalf of the management team of BANGO PLC, we'd like to thank you for attending today's presentation. That now concludes today's session, and good afternoon to you all.