Facilities by ADF (LSE:ADF) — Full year results for the 12 months to 21 December 2023

0:01 Good morning, ladies and gentlemen, and welcome to the Facilities BY ADF PLC Investor Presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged. They can be submitted at any time via the Q and A tab just situated on the right hand corner of your screen. Please just simply type in your questions and press send. The company may not be in a position to answer every question it receives during the meeting itself. However, the company can review all questions submitted today, and we'll publish those responses where it's appropriate to do so on the Investor Meet company platform. Before we begin, I would just like to

0:33 submit the following poll. And if you'd give that your kind attention, I'm sure the company would be most grateful. And I would now like to hand you over to Chairman, John Richards. John, good morning, sir. Good morning, and good morning, ladies and gentlemen. I'm gonna begin just a little bit of background about ADF. Some of you will have heard it before, some perhaps not. But, we intend to be a a one stop shop for film and high end, TV production operating across multiple businesses run by talented local management. We now have a fleet of over 700 makeup, costume, artist trailers, mobile production offices, diners, school rooms, toilets, technical vehicles, and tractor units. We've worked with the world's largest producers and streamers, Netflix Apple, Sky, Paramount, Disney, etcetera.

1:22 We're one of the few high volume UK based Albert approved operators, Albert being the gold standard in sustainability and that is demanded by many of the studios and producers. We're one of the few. And we have a fully twenty four seven managed service. We acquired Location One, a leading service provider of the high end TV and film industry in December 2022. It was our first major acquisition funded from our own resources. On the next slide, you'll see that looking back on full year 2023, we performed well, in line with market expectations despite a very challenging environment in half two, with full year revenue at $34,800,000 and adjusted EBITDA at $7,300,000 We added 133 assets during the year, taking the fleet total to seven zero three at year end, positioning the business well for future anticipated growth.

2:18 You may well recall that there were actors and writers strikes in the second half of last year. Our assets were all taken during the first half of the year before we knew about the strikes. We then put a hold on CapEx. We continue to progress with various complementary, diverse and high margin acquisition opportunities. We're looking at several as we speak. And we fully, and officially opened our flagship operational hub in Longcross, sorry, adjacent to Netflix main studio in The UK during the year.

2:52 Location one, our acquisition, opened new branches at Longcross, Bridgend, Glasgow, and Birmingham, and they've developed a groundbreaking eco based solution very popular with producers and streamers as Marzan will explain as we go by. And we strengthened the business bandwidth for management with the appointment of chief operating officer James Long and equally strengthened the board with an independent nonexecutive director, Joe Goodson. She joined us, mid year and has made an excellent start to her time with us. On that note, for some more detail, over to Marsden. Okay. Can we move on to the next slide, please? Good morning, everybody. So as you were as you're aware, last year, The UK TV and film industry was severely affected by the American actors and writers strike.

3:42 This caused significant disruption with a number of our US led productions having to stop filming immediately with a corresponding suspension of all revenue. Likewise, The US led productions we had in the pipeline for the second half of the year were also suspended or pushed to 2024. And with the likelihood of the imminent strikes, we were proactive putting measures in place to preserve cash and maximize profitability. We established which of our productions were likely to be affected and aggressively pursued all other leads and opportunities securing as many domestic productions as possible. So to put this into some perspective, we'd normally be servicing between twenty and twenty five productions at any one time. And for the duration of the strike, we consistently had between 15 to 17 production productions running, which is extremely positive considering the circumstances.

4:32 We also concentrated on several key areas to preserve cash, reducing the number of flexible working contracts of base production teams and suspending use of more expensive agency drivers and replacing with a d a ADF drivers in line with the business needs. We initiated a freeze on all recruitment and all undelivered CapEx circa 6,000,000, which will resume in f y twenty four when the markets fully normalize. The effect of the strike is carried over into the first half of f y twenty four as the industry resets. As we already have announced, we expect revenues to be reduced for the first four or five months of f y twenty four before no normal services resumed in the second half of the year. Can we just go to the next slide, please?

5:20 So our customer base, Despite the strike, in f y twenty three, we supplied vehicles to 84 productions with an average revenue per production of 385,000 and anticipate a similar number in 2024 with 29 productions already confirmed. We're currently working on 17 productions having recently finished several running long running shows, Gangs of London series three, The Diplomat series two, and Wall four. The largest customer platform by revenue in f y twenty three was the BBC with 5,900,000, so it's 17% of revenue, closely followed by Netflix of 5,300,000 and ITV at 4.914.1% of revenue, which is reflective of us concentrating on the domestic productions throughout the strike.

6:10 Despite the strike, we saw Disney plus nearly doubled its spend in from 2,400,000 in f y twenty two to 4,500,000 and thirteen point one percent of revenue for f y twenty three. ADF and location one jointly worked on 25 productions in f y twenty three, which is helping accelerate location one sales as well as increasing their lead time. The outlook is positive with several new and repeat large productions booked through to h one twenty four, and the order book for h two twenty four is currently looking very strong. Move on to next slide, please. So some information on the industry outlook, which again is positive. The film and TV spend for FY '23 was 4,200,000,000, down 27% from a record 6,300,000,000 in FY '22 to '22.

7:04 The American Act of Strike accounted for 2,100,000,000 difference. However, there is more positive and encouraging news. Today the figures today, there are 228 productions in development, 38 actually in preproduction, and 50 in production with ADF market share at 34%. You may have seen the news this morning about Paramount Global revenue in the first quarter climbed 6% year on year as Paramount Plus added 3.7 millions subscriptions to reach 71,000,000 plus, and the streaming business cut losses by more than 40%. Other good news for streamers, particularly, in the spring budget, the chancellor revealed an increase in the tax incentive to 40% for high end TV and film budgeted up to 15,000,000, making The UK more even more attractive to location for streamers.

8:04 This would have been well received by by American production companies, particularly Netflix who announced in March 24 the production spend outside The EU had outside The US had for the first time exceeded that from within. For studios, there was also positive news with the government announcing 40% corporate tax relief fulfillment TV studios through to 2034. This will help encourage more studio development in The UK. Despite the strikes, there is still a very real concern from within the industry about the lack of studio space as highlighted in the CBRE survey. So The UK requires suggesting that The UK requires an additional 2,600,000 square feet of studio space by 2028 to keep pace with the film and television industry.

8:51 And there's been some large announcements in the last month as well. There's a a new studio, Sterling Film Studios, a major new studio has been greenlit for Scotland with partial funding from the UK government, a 214,000,000 partnership between Sterling and Clackmaninshire Council and The U of Sterling in The

9:12 U and The UK and the Scottish government, part of the 19,000,000 grant secured by the council from The UK Government's leveling up fund for the regeneration for Frostside will be allocated for the development. Likewise, there's been a big development announced Crown Works Studios in Sunderland, a £450,000,000 development, 20 sound stages, and complex in the Sunderland area, which has been backed by the government through a new trailblazing devolution deal. Crown Work Studios will generate 336,000,000 per year for regional economy and create around 8,000 jobs. Could we go to the next slide, please? So we're moving on to growth strategy, organic growth strategy.

9:58 ADF, we continue to grow our footprint and market share, increase assets to 703 by year end '23. At the start of h one twenty three, we made a decision to accelerate orders of equipment in advance of the potential withdrawal of the 130 super deduction capital allowance at the end of March twenty three, which was subsequently continued. With the then onset of the strike, we put the remaining orders on hold, which will now take delivery of by year end, increasing our assets to 750 and a cap expense to 7,500,000. And we'll review order order levels for '20 for financial year '25 as we approach the autumn. Move on to the next slide, please. And we move on to acquisitions, gross margin acquisitions.

10:45 So location one have completed its first full year under ADF, and it's now fully integrated into ADF's IT systems, insurances, HR support, finance procedures, and reporting, sales, and CRM platforms. We're pleased to see growth, which has come through the opening of four new regional depots in Bridgend, Longcross in Chertsey, Pioneer Studios in Glasgow, and Digworth Box Studios in Birmingham, are putting forward joint bids on productions, which in f y twenty three twenty three resulted in us working on 25 productions together. We are currently continuing to to assess other m and a opportunities in line with our investing criteria and IPO commitments. We've currently several active opportunities at various stages of development with parallel and diversified business activities, but all still centrally focused in the TV and film industry.

11:41 Move on to the next slide, please. ESG. So we invested in our senior leaves leadership team with the appointment of nonexecutor Joe Goodson and our chief operating officer James Long. James is a qualified accountant, ex manager director of the Radio Times and has been in the role since last October and has seamlessly integrated into the business and management team and is making great progress. In terms of governance, health and safety, ADF continues to work with safety forward on the twelve month plan, which outlines the key areas of focus for 2024. We reported a fourteen percent reduction in personal injury incidents in f y twenty three compared to f y twenty two, which is extremely positive considering the increased number of staff and operational levels over this period.

12:30 Systems and projects were completed to replace ADF's planning tool, The Matrix, with a BMS system, which is now up and running and in the process of moving forward into phase two and finance system CRM with enterprise solutions from Sage and Salesforce respectively. Environmentally, we implemented our long term ESG strategy, Ecoset, and completed our first carbon audit in f y twenty three with our partners, Creative Zero, with a benchmark carbon footprint. We launched our eco based service, which is currently being utilized on two productions, BBC silent witness and Netflix in the room with three more schedules to commence commence in May. I'd just like to give you a bit of information about Ecobase. So if we can move down to the next slide, please.

13:20 There we go. So this basically gives you an idea of what Ecobase is. So developed in collaboration with location one, this is an innovative solution. It's set to redefine the unit based operations, and we offer a sustainable infrastructure that minimizes environmental impact and maximizes production efficiency and sets a new standard for eco friendly practices. Ecobase is designed to provide production teams with

13:46 an eco friendly unit base that embraces re resource conservation, waste reduction, renewable power integration, and sustainable water supply and water treatments. And by prioritizing sustainability, we aim to reduce the industry environmental footprint and spot positive change. So if I can hand over to Neil now, our chief financial officer, he'll take you through some financials. You're on mute, Neil.

14:24 Hi, Neil. I've just unmuted. Yeah. Sorry. Yeah. Yeah. Sorry. Quick run through the P and L, starting with H one. So we reported previously that we had a great start to 2023 following on from a very busy q four in FY twenty two, you know, with generally bigger, longer productions. Revenue was up 9,200,000 in h one compared to h one in the previous year, and 5,200,000 of that increase came from our new acquisition, Location One, which we acquired in December 22, and 4,000,000 of the increase came from the core business with like for like sales up 32%. The production we were working on were more concentrated around the London studios and those other regional locations that we can more easily service.

15:14 So that meant that transport and labor costs were a lower percentage of sales. So our gross margin actually improved from 33% in the previous year to 39% last year, which is exactly what we're expecting with the move from Hampshire, our previous operational base, to Longcross, which is just outside the M 25. H two, that was obviously a very different experience. The strikes, as Martha said, caused a major drop in revenue for us with many productions just stopping immediately. And others that were booked in page two have been canceled or pushed forward into 2024. So we had to very quickly find out which productions were going ahead and then went aggressively after everything else that was in the market, which is generally smaller domestic productions.

16:09 And we had to do deals to win work as well.

16:14 But at the same time, to preserve cash, we suspended all our CapEx orders, as Miles mentioned, you know, working with our suppliers and had to reduce our running costs where we could with training, travel over time, weekend working, agency staff, etcetera.

16:31 So overall, the adjusted EBITDA for last year was 7,300,000, which is 21% compared to 8,000,000 and twenty five percent in the year before that. There were some exceptional costs which kind of netted off largely. Firstly, we undertook an impairment review of goodwill on the acquisition of location one due to the impact on the so medium term forecast from the strikes and resulted in a goodwill reduction from 7,300,000 to 6,300,000, but that was largely offset by a an £800,000 reduction in the provision for the deferred contingent consideration for the previous owners because the earnout being cumulative over a three year period was, you know, very likely to be very unlikely to to be achieved.

17:31 Interest in payable in 2023 increased by 600,000 compared to the previous year due to a full year of capitalization of lease of the Long Cross site under IFRS 16 with a full year of location one's own IFRS leases and HP leases, plus the extra equipment we bought and, generally, you know, interest rates going up last year as we did. There's no corporation tax payable because ADF's there's a quite a pool of excess capital allowances. We've actually got £16,000,000 worth of capital allowances carried forward at the end of last year, so that will offset corporate tax for a couple of years to come. And the full year profit of tax was therefore 800,000,

18:20 which compared to 4,600,000 in the previous year. Okay. Next slide, please. Onto the balance sheet. So start with fixed assets. So CapEx for last year was very much front loaded to make the most of these super deductions, which has built up this big tax buffer for us, as I was just saying. We spent 11,900,000 in total on CapEx, adding 133 assets at an average cost of 72,000. Location one spent 1,900,000, and we also capitalized some property leases for 1,100,000 under IFRS 16.

19:05 HP agreements for equipment at the end of f y twenty three totaled 16,300,000. That was up 3,000,000 from the end of the previous year. And the IFRS leases totaled totaled 8,900,000, nearly all of which relates to the lease for Longcross. And there's no other debt in the business. So the net debt position at the end of the year was $12,900,000 Next slide, please. Lastly, then the cash flow. So prior to the strikes, the operational cash inflow was forecast for last year to be $10,600,000 However, the actual inflow was reduced to 5,500,000 due to the strikes, you know, which is basically our adjusted EBITDA of 7,300,000 less moving in working capital across the year because of the falloff in trade of 2,200,000.

20:03 Out of the total CapEx of 11,900,000, we paid 4,500,000 in cash, and the other 7.3, we financed with high purchase with our finance partners. And finally, the other draws in cash were HP

20:23 repayments of 5,800,000, which was up from f y '22 by 2,000,000, and the dividends paid in the year GBP 1,100,000. And that's around through the numbers. So handing back to John.

20:40 Thank you, Neil. Yes. So in summary, ladies and gentlemen, we believe that we're in a very good place with the strike having come to an end. The size of our fleet, we equally believe that we're in a very good place having added to it in the first half of last year and the potential to do so in the second half of this year.

21:04 Our order book for the second half is very strong. We remain the leading provider of premium products to film and high end TV in The UK. And there are a limited supply of premium production facilities in the marketplace, which gives us a very strong advantage. As you've heard with

21:23 local tax allowances, with tax incentives from central government, We are a fine destination for people to make film and TV. Not least, apart from the financial considerations, the scale and quality of our studios and our supply of producers, directors, actors, and animators. I could go on and on, but we are regarded as a premier place in world film and high end TV production. Dividend policy continues to be progressive.

21:57 Strong market drivers and a business model gives us platform for sustainable growth and that includes acquisitive growth. We have a great level of earnings visibility. As Lars has said, we have invested in the right teams and the right people. We're increasing our management bandwidth, and we have aspirations of $100,000,000 of revenue, and we will grow to that both via organic growth and acquisition. We pause for questions. Perfect. John, Marznor, if I may just jump back in there and thank you very much indeed for your presentation this morning. Ladies and gentlemen, please do continue to submit your questions just by using the Q and A tab that's situated on the right hand corner of your screen. But just while the company takes a few moments to review those questions that were 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.

22:50 Guys, as you can see there in the q and a tab, we have received a number of questions throughout your presentation this morning. And thank you to all of those on the call for taking the time to submit their questions. But, John, Marsno, if I may now just hand back to you just to read out those questions and give your answers where it's appropriate to do so, and then I'll pick up from you at the end. Thank you. Okay. Okay. Okay. First question.

23:11 The failure to pay a final dividend will be a kick in the teeth for many shareholders. Are your finances really so desperate that you can't afford to a decent dividend track record by paying the same as last year as analysts were forecasting?

23:28 Mars, if you'd like me to take that, I don't know where the information came from, but I think it was made clear in our recent results that we are paying a final dividend. It is a progressive dividend and slightly up on the dividend, that we paid last year. So for whoever put the question, pleased to say that the information you had is incorrect. We are indeed paying a progressive dividend as forecast and as promised. Thank you, John. Next question.

23:58 Is is location filming under threat from artificial general intelligence? So I'll probably take that one. At this stage, it's not.

24:12 To give you an idea, art artificial intelligence is used, but in used in terms of mass when mass filming is required. So if you take a film, let's say, I don't know, Gladiator in the coliseum, they would build a small quarter of that coliseum and,

24:36 fill it with extras for a day to film the crowd scenes, and then they would use the, IA then to, superimpose the rest of the coliseum. In terms of, for actors, actors are like sports stars. Actors haven't signed their own contracts, and they they are protected with image rights, etcetera. So in in that respect, there isn't any any risk there. It's been used for quite a while over for the last five or ten years, I a, in terms of the crowd filming as I just mentioned. So we don't we don't feel that there is any threat in the immediate future with that.

25:16 Thank you for that question. Next question, Gary b. With development in studio infrastructure and your increasing power of a one, what 10 what tens are you seeing in the industry and the ADF business? Well, just repeat my response to the last question. It's the same. We're not seeing any any any change at all. Question from Tom f. Do you have any idea on The UK high end TV and film production spend for f y twenty four, and are you expecting it to be above f y twenty two? Shall I ask that? I would suggest, the answer to that is no. We don't expect it to be above f y twenty two, which was 6,300,000,000.

26:01 I would suggest it would be similar to f y twenty three at 4,200,000,000, primarily because the two years are mirroring each other. So in f y twenty three, the industry was at full pelt in the first, sixth half of the year, and then the strike hit in the second half of the year. And in f y twenty four, we're seeing the effects of strike continue into the first half of twenty four, and then normal service will be resumed in the second half of f y twenty four. So it would be fair to say that the the figures should be similar over that period. Next question. Tom f, can you please touch on how your market share has evolved over time?

26:52 John, do you like Sure thing. Well, there are three, large providers of the facilities that we have in the country and one medium size. And then there's a lot of much smaller family run businesses just in local areas. The answer is split into two. If you took market share of high end TV, we are very much the strongest there. And our market share of that segment is probably going to be mid to high 40 percents. If you take the film, the major movie segment, we're a little smaller there with movie makers probably being significantly larger than us with film and and also Translux.

27:42 Overall, our market share, we estimate to be around about 24% or 25%. And actually, in my five years with the business, it has grown a little as as we've grown the size of our fleet. But in general, we have increased our turnover in line with the rising tide as more and more production is made in The UK. So in answer to your question, our market share over five years, it's increased marginally, but that's due to additional vehicles in the fleet. What we've mostly done is grow because the whole industry has grown, and we've grown as part of that. Thanks, John. Good answer. Next question from John s. Can you give an idea of the order book and backlog compared to the same time as last year?

28:34 Well, I can take that one. So the order book is now looking very strong, and that's basically because we've had an industry reset. So just explain what's happened. So we all we know that there was a strike at the end of last year, which was was resolved at the end of October. And then what happened when the strike was resolved, those productions that we were working on, Star Wars and or, and some Apple productions that had American actors as writers, those picked straight back up because, basically, they went on hiatus, so they kind of shut the studio doors or everyone went home. Strike finished. Everyone came back in. They just carried on. Then we have the Christmas shutdown. So in our industry, in the TV and film industry, Christmas is the only time the industry actually shuts down. So it shut down for probably three to four weeks over the Christmas period.

29:27 So we came back to work after Christmas. And what we see then is we see a lot of new commissions and new productions being announced. And then what we're doing, we then so we then contact our customers, and our customers are predominantly production executives, producers, line producers, production managers, and transport captains. So we contact them to find out what they're up to. They come back to us and tell us they're the process of being interviewed for jobs, etcetera, etcetera. So we keep in touch with them, then they get they get confirmed with those productions. And at that point, we're now up to end of Feb you know, end of January, beginning of February, mid February. We know that they've been confirmed for jobs, but then they're going to start prep, which is anywhere between twelve to sixteen weeks prep. So that takes us up to where we are now in terms of our bookings for July and August. All those big productions, are starting then, and it's a bit of a feast or famine situation, unfortunately. We saw the case in our industry.

30:28 Everything will start at the same time. So our order book for the second half of f y twenty four is looking very healthy and full, which, in answer to your question, was how our order book was looking last year. Yes. But we didn't obviously, the strikes will be unaffected. Next question, Tom w. In the initial pages, you mentioned you expect 2024 to resume normal levels in the latter half. Do you not feel there is a new norm coming in terms of production content being made? Do you have a rough idea of spend you think The UK will see compared to the last few years? So I'll I'll answer that one. No. We don't see as a new trend.

31:18 Our business has always been cyclical throughout the year. No two years are ever the same as anyone who is involved in our industry will know. And for the very reason that I'm just talking to you about resets, you get a lot of productions. Last productions all filming, they all tend to finish at the same time. When those productions finish at the same time, you know, then it has to be a little reset because those productions need to derig. The studios need to empty before and then the next production needs to come in and then build their sets and get going again. So that's the reason for that. And in answer to your question, the rough idea of spend in The UK compared to last year, We I've answered that similar question earlier on, and I would, I think it's fair to assume that it would be similar to last year because of the strikes and the other one of the strikes.

32:08 Next question from John s. Can you give an idea oh, this is one for you, Neil. Can you give an idea of depreciation of equipment versus the real useful life of it, and is there a residual value after the depreciation period? Yeah. So our policy, if you can see from our accounts, is to depreciate on a reducing balance over ten years 10%. Sorry. Realistically, the useful life is longer for the trailers because they don't have any moving parts or things that break down as frequently as, you know, vehicles do. So they can realistically last for twenty years, you know, be refurbished.

32:55 We've we've got our own workshops and manufacturing facility to maintain the equipment. Because we've been on such a build growth spurt for the last five years, We haven't really disposed of a lot of equipment, but the equipment we have disposed has kind of backed up our residuals, if you like, because we for example, with a handful that we sold in the last twelve months were items that we bought in 2014, for example, for £40,000 at the time and sold them this year for £35,000 and £30,000. So the residuals are there, but as I said, we we know we because we've been focused on building to meet demand, we haven't really been disposing disposing of a lot of equipment.

33:49 Thanks, Neil. Next question from Matthew w. I live near Warner Brothers Studios, Leavington, and it looks very busy at the moment with large white traders coming and going all the time. I know they make there. Do you work there much, and can you share what films are made there at the moment? Well, I can answer that question. Yes. We do work there. We work there a lot, But, unfortunately, I can't tell you what we're working on because we have to sign NDAs, we're not allowed to talk about those shows, I'm afraid. But, you know, it's a very it's a very busy studio, and it's also great to hear that it's very busy at this stage. Next question. John s, what is the reason maybe another question for you, Neil. Give you a heads up. What is the reason to invest in CapEx versus lease equipment?

34:44 Well, we don't actually lease. It's not a it's not a lease. It's we're we're basically funding our CapEx with higher purchase agreements. So we we mainly do that with one supplier. It's got their own finance company, actually, in house finance company, which is DAF. So all the vehicles we buy from them, the tractor units, the tech trucks, the gully suckers, etcetera, we tend to finance about half with their finance packages. So so we're not actually leasing anything, you know, as in, you know, a charge going through the p and l. It's it's it's HP generally over 5 to 7 years. And, you know, as such, then we get rights approximating to ownership of those vehicles from from day one.

35:33 Thanks, Neil. Okay. I have a question from GA. Does ADF provide the same facilities to studio based productions as you do to a location filming? So I I can answer that. Yes. We do. So all the all the studios or the the a lot of the larger films that we work on, the Star Wars, etcetera, although they're studio based, they have, all the city vehicles the same as a location shoot based around. And there's a few reasons for that. The first reason is that, Soundstage studio space is is at a premium. So in terms of revenue for studios, they want, their primary estate to get the best value.

36:20 They don't want to use that space, I I I don't know, for a canteen or to store costumes where the value would be greatly reduced. So that's one of the main reasons. So you see, Shepton Studio has just, built more studio space. Pinewood has just built more studio space. They're not building any anything else other than Soundstage for the reasons I just mentioned. And the other reason is that even though when working on productions, like you see the Marvel productions and things like Star Wars, etcetera. Although they're predominantly studio based, they do go out on location at some stage. And there's again, there's a couple of reasons for that. And when they do that on out, they need they need to be versatile and be able to move quite quickly. So we can be for for example, as this happened, I can talk about it. When we worked on star wars and door, the the last series, we've been filming predominantly in Plymouth Studios for about twenty six weeks, and then we went to Valencia because there's a there's a a big science park in Valencia that that can be used as a as a kind of new age space space.

37:32 So we finished filming on a Friday evening in Pinewood. Crew goes home. We then take all the vehicles on the channel tunnel across the channel terminal, drive to Valencia, set everything up, and they turn up to work on Monday morning and carry on filming. So it it keeps it fluid. And the other thing is that, which we haven't mentioned in this presentation today, is that The UK is a great place for filming. And one of the reasons it is not just because of the studios and the great crews and the landscapes, etcetera. It it is that the UK government is very supportive of our industry, and we have a 40% tax incentive. So a lot of productions come here for those aforementioned reasons, but the other reason is that they like to dip into other territories to enjoy the same benefits.

38:23 So when we do a series like The Crown, it filmed predominantly in The UK, but every year, we'll go to Spain to Cadiz. And Spain Cadiz is interesting because Cadiz has got golden white sands and palm trees and can be used from anything from desert scenes to The Caribbean, etcetera. When you watch the crown and you've seen scenes in Australia and The Caribbean, that's all being filmed in Cadiz. And when they go to Cadiz in Spain, they have a 45% tax incentive. And then likewise, in in France, they have a a tax incentive. And likewise, the same in Morocco and other European countries. So larger productions predominantly will will come to The UK, and they would like to double dip or triple dip into other tax territories.

39:11 Okay. Next question. Robert s, please, can you clarify the amount of proposed dividend and the date of payment as it was not clear in your recent announcement? Neil? Yes. The the amount is 0.9 of a penny. I'm just trying to look what the dates are now. Do you wanna take the next question, Lars? And I'll just come back and Take note. Just We'll come back to that, Robert. Next question, Matthew. Traditionally, when the macro changes, I e, the recession, does filming drop off or with streaming being new new since two thousand eight crash? Is this a no? You like to answer that, John?

40:07 Yeah. I'm happy to. I I don't think it's as connected to banking crises or recession as much as many other industries. And that could have been illustrated by what happened during COVID where where in fact work actually accelerated for us and other people supplying streamers and filmmakers once the initial lockdown was over. So, yes, it's good that a nation is not in recession or a banking crisis, but it doesn't make very much difference to our fortunes at all. Well, also, John, we've also seen, haven't we, that when when there's a, you know, when there's a recession as like with winter, people tend to stay at home and watch more tech, and they consume more of the product as they did in the pandemic. It can be an inverse relationship. Yeah. You're right. Yeah. Yeah. Yeah.

41:04 Neil, have you got the answer? Yes. Yeah. Sorry. It's the ninth just double checked. It's the July 19. So July 19 and 0.9 of a penny. Yeah. There we go. Tom p, has Britax caused any issues for transferring equipment across the channel during the foreign shoot such as Valencia? Tom, no. It hasn't. It's made no difference whatsoever to us. And I think the main reason for that is that we're not importing or exporting any products. So we take, you know, let's take we take, costume trucks and makeup trucks to Valencia to fill. They go with the equipment in, and they fill Carne's out to list what what what's in those vehicles.

41:53 They take them there. They film, and they bring that equipment back. So there's no, there's no sale of any products. We're not delivering products. We we're taking equipment with us to to work on a a a production and then bringing it back. So Britax Britaxit has has had no, effect to our business whatsoever. Well, thank you very much everybody for your questions. We don't unless there are any further questions, that was the last one. Mars, absolutely. And John and Neil as well, thank you very much indeed for being so generous of your time there and addressing all of those questions that came in from investors. 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 just for you to review to then add any additional responses, of course, where it's appropriate to do so, and we'll publish all those responses out on the platform.

42:44 But, John, perhaps before really just looking to redirect those on the call to provide you with their feedback, which I know is particularly important to yourself and the company, if I could please just ask you for a few closing comments to wrap up with, that'd be great. Yeah. I think, well, I'm repeating myself somewhat, but we must never, underestimate what a fantastic place The UK is regarded as in terms of producing high end TV and film. And that runs from the business rate tax, 40% rebates to the tax allowances to the number of talented people we have here, along with studios, and as Marcin said, a wonderful variation in different landscapes that can be used. It's a place that people like making film and TV.

43:34 And, it's a nonunionized environment. There's very little restriction on how many hours can be worked. It's very, very popular indeed. And with the strikes being over and beginning to get back to normality by midyear, we see the increased studio space, the increased inward investment, the end of the strikes, we see a very, very buoyant period come, for making film and TV in this country. And, and believe me, we're in a very, very good position to take full advantage of that and play our part in in the nation's success with film and high end TV. John, that's great. And Miles and Neil as well, thank you very much indeed for addressing for updating investors this morning. 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 management team can really better understand your views and expectations.

44:29 This will only take a few moments to complete, but I'm sure will be greatly valued by the company. On behalf of management team of facilities by ADF PLC, we would like to thank you for attending today's presentation. That now concludes today's session. So good morning to you all. Thank you very much. Bye bye.