Braemar (LSE:BMS) — H1 Results Update

0:01 Good afternoon, ladies and gentlemen, and welcome to the BRAEMAR Shipping Services PLC H1 results update investor presentation. Throughout this presentation, investors will be in listen only mode. Questions are encouraged and can be submitted any time by the Q and A tab situated in the right hand corner of your screen. To click q and a, scroll to the bottom, tap your question, and press send. The company may not be in a position to answer every question received during the meeting itself. However, the company 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 you'll be notified once they're ready for your review. I'd also like to

0:33 remind you this presentation is being recorded. Before we begin, we'd like to submit the following poll. I'd now like to hand you over to James Gundy, CEO Nick Stone, CFO of BRAEMAR Shipping Services PLC. Good afternoon. Thank you, Paul. Appreciate that. Good afternoon, ladies and gentlemen, and thank you for joining the BRAEMAR presentation this afternoon. I thought the important thing to start was, bearing in mind, some of you may know BRAEMAR, some of you may not, and I'm sure many of you don't know necessarily know who I am and Nick. So maybe a little introduction, first of all, to explain why we are and who we are. Obviously, my name is James Gundy. I've been in the business some thirty five years. Originally started broking at Clarksons for some ten years, then moved to a smaller company called ACM.

1:19 We grew that company, and we IPO

1:23 ed that in 2006, and I was a COO, instrumental to the IPO, then moved to become CEO in 2012. Then we merged into BRAEMAR shipping, and it became a reverse takeover on the shipbroking side, and I became the CEO of shipbroking. A lot of restructuring. It took quite a few years to get together.

1:48 And from then, I thought it's the right time to move to become group CEO, And that's been our position for so since January the first this year. Now Nick Stone is the group CFO, and I think he should also deliver introduction before we move to the presentation. Go ahead. Good afternoon, everybody. Yeah. Stone. I've been with BRAEMAR just under three years. Prior to that, I was with several other small, medium sized listed companies, not in the ship ship broking or shipping space, but generally people businesses, which of which shipbroking is another example. Been involved in a lot of the restructuring that's gone on over the last two years and for the last year in particular working very closely with James to reset the strategy and sort out some of the historical issues with the business which of which we've made some good progress in the in this period.

2:50 Okay. Right. Let's get on with the interim results and the presentation, and I can guide you through that. Obviously, from coming in, as Nick mentioned there, I I had a strategy to focus the business on the shipbroking, which was really the core business, and to grow and strengthen revenue profits. That's happened. Streamline of business, as I mentioned.

3:12 And the trading has continued so far this year and has improved throughout the year, in fact. And we've obviously been upgrading the market accordingly to what's been happening. And the balance sheet has obviously strengthened on the back of what we've done. So we can continue. Now, obviously, coming in as group CEO, I had to think make a bit of an impact and say where I thought I could do. And bearing in mind what my past record for the last ten years and what we've done, I feel it was fair enough to put a certain target and to say it's ambitious, obviously, but to say that I felt I could obviously double the size of business next four years, achieve optimum scale and market share, utilize our position as a UK listed company. Now how we achieve this is obviously through organic growth, obviously a key factor, target acquisitions, new products coverage, which we've already set on done that, as you'll see later on in the presentation, utilize technology and strengthen our business infrastructure.

4:13 Now since the changes this year, we've seen board changes with new Chairman coming in, who's I can obviously say that myself and him have really hit the ground running. Trist Simmons moved in as COO. I've known Trist for some twenty five years. We bought his business in Braemar, Lanting to set up our securities business, which has done exceptionally well. It's now some 12%, 13% of our business. This is good to come in now as NED replacing on the REMCO side. Now rescheduling Narvest, which I managed to do, and that's by bringing them into shipbroking as well. So I did that.

4:49 And from there, we managed to defer some of the payments, as you can see there and written there. The balance sheet was re strengthened and improved short term liquidity. Planned integration of financial and chipbroking divisions, obviously, and combined expertise in chip investment and risk management. All this has obviously happened within the year so far. Now I think I'll let Nick obviously go through the the the Qualys. K. Thanks, James. So another thing that has been done over the last three three years basically is disposal of a loss making division that was BRAEMAR technical services was put into a listed Norwegian business that became a Qualys BRAEMAR.

5:36 During this period, we have now sold out all of our remaining holding in it. We had cash proceeds in the period of just under £8,000,000, around 16,000,000 in total, which again went to further strengthen the balance sheet. And then the last piece of the jigsaw, really, of of what used to be a sort of four division business is a planned joint venture of our logistics division, which is called Corrie Brothers, with a Dutch competitor called Vertom,

6:10 where we believe they will form a much stronger pan European business that will be able to compete on the global stage much more effectively the either business on its own. We'll talk a little bit more about that on a a a further slide later on.

6:31 Then, really, the trading trading overview for the the first six months of our year. Revenue was up by 11. Underlying operating profit up by 10%. The shipbroking markets that we operate in were were in dry cargo, sale and purchase, and securities were very strong.

6:53 Tankers was relatively weak, but we are now seeing signs of recovery in that. We had significant success fees in our financial corporate finance business called Narbez, and revenue there was up by 49%. We also saw revenue and profit growth in in Cory Brothers, which is the business that's into the joint venture. Operating profit, you include that Cory Brothers element, was actually up by 23%.

7:25 And we're pleased to say that full year trading outlook was in line with market expectations. And and also to note that those market expectations have been upgraded a couple of times already during the period. So strong trading in the period as well as dealing with a lot of the the the the balance sheet issues and the historic baggage that was present in BRAEMAR. And if we look at the numbers, you can see the the headlines that I've already run through. Revenue, 47,400,000, up 11%. Underlying operating profit was the measure that's up 10%. That doesn't include Corey Brothers because it was it's treated as held for sale on the balance sheet.

8:14 If you include that profit, it's up 23%.

8:18 Then our reported profit before tax, was up by over a 100%. That's because of the profit that we made on the sale of the BRAEMAR shares. Underlying earnings per share up 11%. We also have paid an interim dividend, of 2p, which we we didn't pay one. We passed dividends for two periods due to the uncertainty of COVID, but we're now back to paying a a modest dividend at both interim and final level. What we talked about the balance sheet strengthening, and you can see that over the last twelve months, our net bank debt has nearly halved has more than halved rather, And our total net debt has also halved from

9:10 30,000,000 at August 20 to 14,700,000 at August 21. So there's a lot of noise in our results, but the underlying measures, we think we're all very pleased with, and we think they're all heading in the right direction.

9:33 James, shall I hand back to you?

9:36 Yeah. And, obviously, there's been many changes in the ship broken world, especially as, you know, from someone's been there for thirty five odd years. So I've seen many changes. The one big key factor is consolidation. Obviously, shipping is in the line of discussions regarding carbon reduction. I mean, we're presently shipping 2.5%, the present world carbon.

10:01 So there's going to be a lot of there's going be a lot of changes within the shipping world as far as in changes of fuel, etcetera, etcetera, etcetera. Slow steam is expected to be the short term choice because that's obviously reduces carbon, but that continue that creates a supply and demand issue. Large part of the fleet is aging. Shipyards are presently full until 2025, late 'twenty five.

10:27 So there's lots of reasons why it's looking strong. COVID disruption will continue. It's still continuing. We see 13% of the world fleet sitting outside on the container market, sitting outside either Los Angeles or China, trading costs increasing. We see the IEA expects oil demand to recover. That's an obvious factor once COVID comes back. So we expect the tanker market to return to its strength.

10:53 As I just mentioned, newbuilding orders are low, twenty year low. And we are seeing that there's a massive demand for steel. So the recycling market is very strong, and we'll see the older vessels start to be removed from the fleet.

11:10 You can change, Nick. Now this is an interesting slide for us of where we need to grow and where we came to that bold statement of doubling our business. Obviously, you can see from the graph below where we're strong, and some of those blue graphs have actually turned blue in the last three or four years where we've invested heavily in the shipbroking side. That obviously allows us still to grow the business, especially within other sectors of the world. We already have some fifteen, sixteen offices around the world already,

11:43 so we can easily add into that. So that's so we'll obviously expand on the derivative side globally. And, obviously, with as as new markets come in, we'll obviously be part of that as well. So hoping to move into that. Sorry, Nick. And I'll let Nick go on the Zuma one here. So one one of the things we've done over the last year is invest in a business called Zuma Labs. It was set up by a former trader in the drive freight futures market who identified a need for better data around some of the the the shipping related paper trading markets. So we've invested in that business.

12:29 We now own around 20% of it. And what it provides for us is a a screen, which we we think provides the best data for the current trading in in the dry FFA market in particular, but also will be developed in certain other other markets like LPG and and certain other paper trading markets that, we operate in.

13:01 It it drives customers to the screen to get access to the best data as to what's going on in the market. It's not a trading screen per se, but it does allow customers to put orders for for either either either sale or purchases of these paper contracts, which then allows our brokers to be both more efficient and and also have a better view of where the where the market is heading in any one trading session.

13:34 And since since this screen has been available, our revenue on that dry FFA desk has increased by over 400%. So we we've actually invested in more people as well, more brokers to sit on that desk. But there's no doubt this technology has driven more customer, more interest, and and therefore more

13:57 commissions generated for for BRAEMAR as a result of the the the availability of that data. We see this as an important area where we continue to invest in the future in order to grow the the the BRAEMAR business.

14:16 Okay. The next slide then, and I I I touched on this at the top, is is the rationale behind the CORIVERTON joint venture. Corrie is a good business, a a great hundred year plus brand in in the British port agency market,

14:36 but but it's never really broken away from from being a a UK business. They've worked with Vertom for the last five or six years. Vertom are very strong in the in the Northern Europe, in the Baltic, and in some of the Mediterranean ports as well. So between them, they can cover the whole of whole of Europe, you know, in a way that neither could alone.

15:03 And we think that there'll be synergies in terms of cost, but, also, it it will be a business that can grow stronger given the the increased coverage. We expect this joint venture to be concluded by the end of this financial year. And as I mentioned earlier, this business has shown as held held for sale on our balance sheet. And the the final disposal into this joint venture vehicle will be the the the final piece of that jigsaw, if you like.

15:40 I'll then then just move on. I think James will will talk a little bit about the the revenues in the business. Yeah. And I think it's it's the most important thing about as I mentioned about with the consolidation story, etcetera, is about the diversification of the business. I mean, from being when we was at ACM, we were a smaller AIM public business that predominantly focused on tanker market. It was great when the tanker market was obviously strong, but when it went weak, it caused all sorts of problems. So by diversifying in the last five or six years, we've invested heavily into dry cargo and some key players, whether that be in in Europe or whether that be in in Singapore.

16:27 Obviously, into securities, I believe in securities, you know, the futures market is very much a tool that the the brokers on the physical side need. So with that, you could have you can't really attract the top guys to come in

16:40 unless you've got that desk as well. So you can see from where we were in '21, you can see how strong tankers was. That's partly caused by when the oil price went into negative and the forward curve, which massively into contango, creates storage. But you can see, obviously, where we are now on that pie chart. From you know, it means that we can and it goes back to the the the graph we showed you earlier about how we can grow our business. The the the groundwork's already been done, so now it's a case of building on those on those desks globally as well as central. So, you know, you can see the prop obviously, revenue profit has gone up as well from 42.8 to 47.4.

17:26 Alright? And then I think at the end, I think I want you to ask me any any basic questions regarding shipbroking. So I'm I'm just hoping you understand what shipbroking is. And if you don't, I guess at the end, you can ask me questions on that and how it's done, how we make our money, etcetera. Okay, Nick. You can go forward. Yeah. And

17:44 just to add, next year, we will be reporting our segmental data on this basis, these seven desks, if you like. In the current year, because of the transition in the business, we still have three separate divisions, which we are reporting separately. And I'll just cover each one briefly in turn now. Shipbroking, which is the bulk of what you saw on the previous slide, as you can see, revenue's up. Underlying operating profit from chip broking, marginally down. The margin was squeezed this year, and there's a couple of reasons for that. We have higher deferred share charge charges during the period, and we have also invested in the business. So we've bought in several new teams.

18:34 We've opened offices in Athens and in Geneva over the last twelve months, all of which has cost money, which has hit that margin, and it's gone down from 15 and a half percent to 14. You will see, however, though, that the margin is stronger than it was in the previous full year. We the other KPI that is very important to us is our forward order book. So that is business that has been contracted but not yet invoiced nor revenue recognized. So in the period, you can see it's gone up from 43,400,000 to 55.5. And and we've also disclosed that since August, it it has increased further up to just shy of 60,000,000.

19:25 And so that really is an indication of the visibility of the revenue in the business as we as we move forward. Then the financial division, this is no no. There's it's a corporate finance a small corporate finance team, 20 or so people, very high margin business. You you can see they they generate income through retainer clients and through success fees, basically advising clients on refinancing or sales transactions and work very closely alongside the sale and purchase shipbroking desks. They had two significant transactions in the period.

20:10 One was a sale, not actually of container ships, but container boxes, and the other was actually the refinancing of an offshore vessel business had been struggling since the oil price came off in 2014 and has finally now been refinanced. So very strong progress. The the one note of caution on this is that it it is a lumpy business, and we will see profits that that that may not just grow in a straight line. And then the final one is Corey Brothers, which we are looking to put into this joint venture. It's traded really well in the period. We have been able to take advantage of that when it comes to the joint venture terms.

21:06 A couple of drivers behind what's going on in that business, some of which was Brexit driven as more and more UK businesses need help in both importing and exporting post the Brexit changes at the beginning of the year. But the business has also been restructured somewhat over the last two years, a new and young management team that have gone about this in a very effective way, and we're now really seeing the benefits come through in margins. With that, I'll hand back to James. Yeah. So, basically, summary outlook. I mean, ship strong ship breaking performance driven by dry cargo securities and sell and purchase. As I mentioned to you, in the last two or three years, it's proven the fact our investment in dry cargo securities was definitely improving in our results as we presently speak.

22:03 ISS fees in Narvest, and the integration of this, obviously, is important because that, once again, is creating we're obviously getting the value of the synergy of the purchase of the business. So by working all together as one team, that's definitely enhancing. A strong trading performance from Corribr, as we mentioned, bricks related and important complexities. Disposal weight spec, you know, that met in a quality, so obviously, yes, it had its time, seen lot And progress of the we've the seen in to normal, inevitably, we'll be back in demand.

22:53 You mentioned there on the financials there as well. So then Prosper has got a faster growth logistics as a result of planned first from JV, trading in line with full year expectations. That's fantastic. Thank you, James, Nick. Thank you indeed for your presentation. Ladies and gentlemen, do please continue to submit your questions using the Q and A tab situated in the right hand corner of your screen. Just while the team take a few moments to review those investor questions submitted already, I'd like to remind you that recording of the presentation along with a copy of the slides and the published q and a could be accessed via investor dashboard on the Investor Meet company platform. Just like to remind you that your feedback is important to the company. And immediately after the presentation has ended, it'll be redirected to the opportunity to provide your feedback in order that the company can better understand your views and expectations. JamesNet investors have submitted a number of questions during the presentation.

23:42 Perhaps if I could just hand back to you, Nick, to read out the questions where appropriate to do so and either take them or direct them to James, then that would be fantastic. Thank you. Yes. And Paul, just to make sure everyone realizes, we have no don't be embarrassed to ask you know, simple basic questions to understand our business because the the worst thing I feel is that if you don't understand what we do and how we make our revenue, it's hard it makes it harder for you to go to understand what we've said the whole thing's about. Absolutely. At least, you know, ask away any questions that the team will be greatly happy to take. Thank you. James, maybe I'll suggest the first one we should take is from from Henry. How does the FFA desk fit in with the physical broking desks, or do they operate independently?

24:31 Are we seeing are these are these questions on here as well? Because I'm I'm asking to see these questions about the answers. So I've got I've got them in front of me. So I'll I'll read them out, James, if that's okay. And that's Henry from Surrey Ware, Henry Ware. Is it how does the FFA desk fit in with the physical broking desks, or do they operate independently? No. I mean, look, the FSA desk is important for the tradies because they're they're hedging their risk on physical. It's it's difficult for a trade to understand because of the volatility of the markets. So they will be buying a forward curve position to protect against a forward delivery physical deal. Now obviously, for the broker on the physical desk, we're watching where the forward curve is, whether it's a negative or a positive. Normally, a sign of a positive purchase on the forward FFA curve is normally it's a feeling the fact that the market is probably going to be moving up as opposed to be down. And if it's a sell forward or selling on the front position, there's a good chance that demand is coming off. So it it definitely needs to run. It works very much in the dry cargo FFA desk as well as it doesn't have wet FFA desk and that LPG desk.

25:42 And we're obviously growing those into other markets as as the traders want protection. So and what we're seeing also, we're seeing that the the trading desks, the freight desks within the trading houses are able to take positions to to hedge against their own internal movements in trading. So it's it's it's used in a number of manner of ways, but it's it's a hugely liquidity market now over the last fifteen, twenty years. Thanks, James. I'll I'll take the next one, which is about the the Corey Burton joint venture from David. I I maybe I did I wasn't clear in terms of what I said earlier. The the joint venture isn't coming to an end. It's it's the the actual execution of the joint which is coming to an end. So sorry if that was misleading.

26:39 The the follow-up question on there is, are there any anticipated additional new international office openings? Well, we we we are looking at adding to certain offices that we've got. Geneva and Athens are important, Dubai, Houston in The States. We we rather than any new offices, I think we're those those offices are all still fairly small, and therefore, we're more likely to be looking to add to those offices new brokers than any new, offices per se. And then the third part of that question is, are we looking at restructuring our loans prior to possible interest rate increases? We are we are in regular discussions with with our main bankers, HSBC, we'll we'll be looking at a new set of facilities sometime over the next twelve months.

27:33 We have just in terms of the liabilities to the acquisitions we've made, we have just restructured that. We have some protection in it against interest rate increases already. Next next question. James, one of your favorite subjects I know, the how will the shipbroking market be affected by the green hydrogen propulsion and transport? Okay. Well, I I don't think we're quite there yet on hydrogen transportation yet. That's a bit far away from where we are today. I mean, I've had meetings with yeah. I do another new building business with with the Koreans, and I was I was seeing the head of the Dubai office only a couple of days ago.

28:24 And, you know, yes, there is some 50% of their present order book on dual fuel basis, which is predominantly basically either LNG or LPG, dual fuel as opposed to normal fuel oil. And we've seen recently with Moller Maersk Line, obviously looking at methanol. Now there is obviously subject now we're seeing the focus of dual fuel being LNG, methanol, ammonia, and there is the talk of hydrogen down the line. But we're too far away from that yet to see where it's all gonna go. And it's a massive change of the way. And on top of that, the owners aren't necessarily wanting to invest because they're unsure themselves with where the market's gonna go.

29:14 So it's a long way to go before we start seeing hydrogen personally. Then the next question, I'll I'll try and answer. And and, James, please please, you can have your thoughts afterwards. But the question is around, from Colin, why there is so much port congestion at the moment. And I think the majority of it is either a a hangover from COVID disruption or the result of continuing COVID disruption. Whilst the the ports in in Europe are generally free of shut of lockdowns and of of issues caused by COVID, it's not the case in a lot of the Asian ports where there are still ongoing quarantines and closures and delays in ships moving in and out, which has just meant that the the backlog from all of the disruption that started eighteen months ago has just never been cleared.

30:13 And the the the the situation as we run up, obviously, to the festive season is, you know, is is adding more pressure onto the onto an already delicate and difficult scenario. Yeah. Let me let me add to that. I mean I mean, what we're seeing, you know, as you can imagine, there's there's crew changes. So we see in the crew change every three or six months. That's been difficult because, obviously, for moving it out of various different parts of the world, you know, on the big VLCC tankers, they're normally discharging offshore. So they're not having to come into the inner ports. On the container ships and the dry cargo ships, they're having to come in. And that that's where it creates the problem. You see the crew changes. It's congestion.

31:02 It's suddenly we're seeing some one minute as the port in China gets closed because of of COVID. We've had we've had ships just, you know, loading in West Africa. Suddenly, one person goes down with COVID, then the whole ship has to go into quarantine, crew changes. So it's it's a never ending story of of of problems. It's not easy to move, you know, 20 people from, you know, into a different part of the world, say, for example, like Nigeria to have a crew change. It it creates a lot of problems. And with that, it goes it it goes there's obviously continued issues with potentially tank top scenarios at loading areas or discharging areas where the demand for the cargo is short. So it creates a massive nightmare. So Ernie mentioned recently it's gonna take another year or so before this this this is basically unrevealed and untravels.

31:54 Next question is from Mike, which is how do we move to a carbon neutral business? James has already given part of the answer to that around the the sort of alternative fuels. But one of the areas that we we are looking at and is a top potential opportunity for for for our business to grow is is providing carbon offsetting and alternative structures for our our customers. And and we are looking at whether we can set up a carbon trading desk within the business so that when when an an increasingly frequent charterers or or the the ship owners are looking for measures that will allow allow them to to be carbon neutral, we can actually support them with it.

32:48 In terms of our own business, we have, ongoing work on a ESG strategy, which will include, how we will look to, make make BRAEMAR itself a more greener business rather than the industry in which we work, and we'll be publishing some of that with our annual report next year. Next question perhaps is from Henry, which is what is our capital allocation strategy? Well, I mean, I think from the things we've talked about today, we've made it very clear that we will be focusing our our investment within the the shipbroking business. We'll we are re we've realized cash where we can from the other businesses.

33:37 And the the the chart that we showed earlier showing where our where our business is strong and where it is where there are opportunities to make it stronger. It gives you a clue in terms of where we will be looking to invest in which desks and in which geographies. What what what we've made very clear over the last twelve months is that our focus will be on on ship broking with the corporate finance arm as an adjunct. We'll not be looking to to diversify away from that, but rather diversify within the shipbroking markets as as James was talking about on those revenue pie charts earlier. Right. Are there any questions here I've missed?

34:26 There's a couple of questions actually about our share price recently. Clearly, we've, you know, we've seen since the middle of the year the the price come off quite significantly. That has coincided with the the dry cargo market turning down a bit in in the last month, and I think there's been an impact on on many shipping stocks, including Clarkson. And we you know, other than that, there's there's not much we can really say. We we are trying to lay out our strategy for growing our business and the trust if we do that job well, the share price will look after itself.

35:13 Yeah. From my perspective as well, the fact is, obviously, as you can see, how we simplified the business. I mean, I was asked questions two years ago how we how do we present how do we present who BRAEMAR is? And I said, well, it's quite confusing for me being the the CEO of the shipbroking side. It's like I can't answer that question. So it's gonna be hard to obviously talk about it to an outside investor. So now we've simplified the business. It should be easier for any investor to invest into this and understand what we do and how we make how we make our revenue. Secondly, obviously, you can see we've upgraded our recent RNSs. We've returned back to dividend. We've got the forward order book is perhaps one of the all time highs of $60,000,000, you know, and the business is very much streamlined. Our age profile is at its youngest.

36:04 Our KPI for brokers is at, you know, the highest. So for us, you know, I just think we're being under looking at business, looking being undervalued. But, of course, you know, that's for our job to rebuild confidence within within our investors to read to to grow the business and prove what we can do. Next question then is from from John. Do we do we envisage using m and a to accelerate our growth? And I think the answer is yes. We we we have an ambition of doubling the size of the business, and we think we can go quite a long way toward that with organic growth by bringing in teams, hiring new brokers, and and increasing our our our spread across desks and geographies that way.

36:52 But, inevitably, if we if we are to succeed in doubling the size of the business, we will need some m and a. There are some smaller broking shops out there that we we could look look at identifying for for acquisition. And I think that's inevitable as we go through this next three or four year period. The the follow-up to that is would we allow retail investors to to participate in any fundraising? I think we're a bit early for for for that sort of level of detail. As you may have seen, we've changed brokers recently to Investec. And when the time comes, we'll be certainly looking to to maximize the opportunities that come out of any fundraise by from raising money from from all sources. So we, you know, watch this space on that one.

37:49 Right. We have one more question from from David, which is is quite a a specific one. The what do we see any negative effects on the shipping routes due to the Chinese expansion into the South China Sea? Not not one I I think I can answer. But, James, is any any thoughts on that one? Yeah. So say that last bit again, sorry. The Chinese expansion into the South China Sea. Yes. I think anything I think that shipping is I mean, all I can say to that is shipping has been going for thousands of years. It's a form of transportation of goods for an infrastructure growth. So anything that any kind of rebuilding in any part of the world, whether that be in The Middle East or in China, there's gonna be demand for shipping. That's put demand supply and demand scenario. So anything like that is a positive.

38:49 I mean, you know, shipping is you know, sometimes we have to be a bit careful as a broker because sometimes when we see disasters around the world or impact through, whether that be through war or whatever, shipping seems to become you know, you saw this year only alone when you saw the Suez Canal close. Suddenly, all the forward curves on freight futures market rallied. This what happens. And as a broker, we sort of tend to sort of benefit from that. Not that we wanna publicly announce that, but that's the reality of it. So any kind of growth demand is gonna be good for the ship project. Right. But one further question just come in from David. Are we seeing material wage pressures?

39:37 And how easy are we finding it to attract new brokers and teams to to join us? I I I think you said sorry, James. Yeah. No. Sorry. Yeah. I mean, look. I think that just to sort of cut in there, Nick. Sorry. But, I mean, look, the the the broking business is is a pretty it's pretty standard really across the across the the broking market on the basic salaries. You know? We know roughly where we are, and we know where our competition is. The business is driven by a reward of a of a bonus. Where where we now add, and it's not just about The Us as BRAEMAR, it's where it's where our client base wants. Our client base is liking the fact that we're a public company.

40:24 We are part of our business regulated. The brokers understand the different sectors. We've they're protected on their KYC departments, compliance, etcetera. So what we're seeing now is we're able to attract the brokers from the smaller shops and need to factor. It puts pressure on the smaller shops to potentially you know, we saw one tanker broker who was quite a player in the market, but purely was tankers, closed down in September, and we took some of their staff. So, you know, I think it's only a benefit for us where we are now, and I feel that, you know, we can control that that the the the we are so what I'm saying is the fact that it's not necessarily about the money to dangle in front of the the enticing brokers to come and work for us. They feel in a way that by working for us, they can increase their revenue.

41:13 Hope that answers your question. Yeah. And and as we as you were speaking, James, another question came in around what our competitive advantages are, which I think actually a number of them you were just running through. Yeah. Yes. Exactly. It is look. I think that, you know, trust me. I've worked for a big company, Clarksons. I've worked for a small company, and ACM is very, very small. You know, we we now are in the position. You you'd be surprised how many people that left maybe at the merge in 2014 who have now come back or the ones that left have now realized they made a mistake and maybe we don't want back. So and I think people, as I say, you know, realizing that the name goes a long way. You know? Trust me. I've traveled around the world in the nineties and, you know, there's a small broking shop called ATM, and lucky if I got to not much further than the the the reception.

42:10 Now when I travel around the world as being you know, as as BRAEMAR, it's I'm I'm sort of ushered into the boardroom, and the various clients come in to see me. So it's a completely different factor there. And, yes, many peep many many of the interdealer brokers have tried to get into ship broking and found that it's very much a relation driven business, and they find it difficult, and they've given up. So that's why we feel quite strong where we are, and that's why we're quite confident with our growth plan. James, Nick, think you've covered off so many questions. Just in case any further questions do come through, of course, you can respond to these post the events as well. But perhaps, James, on that basis, I could just ask you for a closing snapshot to conclude before we redirect the investors to give you some feedback. Yeah. No. Exactly. I want I want to I want to emphasize that, you know, the the how our commission of a broking shop works. I mean, we've predominantly, it's 1.25 on the freight and 1% on the S and P. So you can imagine the higher price of a ship you can go from we see ships go recently from $10,000,000 to $60,000,000 in a period of a year. So you can imagine the commission for the brokerages, which increases our revenue. So at the moment, we're in a great spot. We're feeling very confident about the business where we're going to. The hard work has been done over the last four years, four, five years, and now we can only look forward. And I think I feel confident, understand the business and being a leading by example, sort of one of the large revenue makers for the business.

43:40 That's how I entice this this start to come start entice brokers to come and join us and hold what we have, and they'll be quite proud of where we are today. All right? That's fantastic. James, Nick, thank you for updating investors today. Could I please ask investors not to close the session? It should be automatically redirected with the opportunity to provide your feedback in order the management team can better understand your views and expectations. This will only take a few moments to complete and is greatly valued by the company. On behalf of the management team of BRAEMAR Shipping Services, thank you for attending today. That concludes today's session. Thanks a lot. Thank you, everyone. You, everybody.