Frenkel Topping Group (LSE:FEN) — Final results for the year ended 31 December 2022

0:01 Good afternoon, and welcome to the FRENKEL TOPPING GROUP PLC Investor Presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged and can be submitted at any time using the q and a tab situated on the right hand corner of your screen. Simply type in your questions and press send. The company may not be in a position to answer every question received during the meeting itself. However, the company will review all questions submitted today and publish responses where it is appropriate to do so. Before we begin, I would like to submit the following poll.

0:32 And I would now like to hand you over to CEO, Richard Fraser. Good afternoon to you, sir. Good afternoon, Alex. Thank you, and good afternoon to everybody on the presentation. Just before we start, for those of you who are getting into the actual presentation of the results, for those of you who don't know the company, quick background. We originated in Manchester in 1979, over forty years ago as FENKEL TOPPING as chartered accountants. The business, the company was set up to provide litigation support to lawyers dealing with high value catastrophic cases. So these are at the top end, these are serious broken backs, broken necks, acquired brain injuries, wrongful births in the NHS. In 1989, we pioneered the use of something called a structured settlement, which I haven't got time to go on today, but basically it was a way of giving a claim of tax free income as part of their damages and the IFA business was born out of the back of that. And for the last thirty five to thirty three years, we spent our lives in the personal injury and clinical negligence space at the catastrophic end providing litigation support for lawyers.

1:44 But ultimately, our goal is to get to the assets, the damages that the claimant has received and that we will then manage those assets for the remainder of the claimant's life. And and that's what we've been doing ever since since ninety nine point nine percent of what we do is around, personal injury and clinical. So we're not really a typical IFA or wealth manager from that regard. We're here today to talk about the results from last year. So there's Elaine and myself presenting and and and just over the last three years, we've raised £23,000,000 in in equity and we've used that to to consolidate the professional services that that lawyers need to work out, what a quantum is, what cases were. So in The UK, what the law says is is that you will be put back in the same financial position but for the accident. So if you can never work again, you have a loss of earnings claims till you die, you've got a pension loss claim.

2:47 If you need care seven days a week, twenty four hours a day, which could cost anything up to £200,000, you can claim that back. It's all about your future losses and what you've lost to the date of the trial. We don't have big peculiar losses in The UK like we do in America. So having set out our store for the last two years, we've executed that plan and now for us it's about our growth plan for the next five years, how can we accelerate growth in the business and we're looking to capture 15% market share, driving in 300,000,000 in new assets every year and to double our revenue over that period based around KPIs of client retention, growing our assets and particularly our assets in our discretionary fund management business and to become a full service provider to lawyers dealing in this space measured by market share.

3:42 So this next slide is just, you know, what do we do? We we are a long established business. We are here to support our lawyers and clients, the lawyer clients and the client clients through this litigation journey. And we start right at the beginning, in the major trauma centers in The UK. So some of you may or may not be aware but the

4:05 NHS success story was set up these major trauma centers a number of years ago. If you had a catastrophic accident at the then and you survived the accident, you were taken to your local accident emergency, you had an eighteen percent chance of survival because if you needed brain surgery or heart surgery, the consultant was very rarely there or the wrong call and by the time they got in you died. Now within these trauma centers they have heart surgeons braces that are twenty four hours a day so if you get to a trauma center and you'll probably go past your local A and E, you've got a fifty two percent chance of survival. So we operate in the trauma centers, cardinal side hosting service and we're there to help families through this difficult situation. We signpost them to help with counseling benefits if they've got problems with their employers employers.

4:57 We're there as a service within the NHS to help and the transition from the trauma center home onto the to A and E. But within that, about a third of people going to the trauma center will have a claim. It will be an accident, will not be their fault. And so within that, the we run a panel of three law firms per trauma center, and we refer cases from the trauma center to the panel, to the lawyers. It's gonna be doing the right way. Governance and patient care is paramount. It's done with consent to the family. It's done with consent to the doctors and the nurses, in order to then help that family with a claim for damages. So with their right at the start of this journey, helping them, refer them into the right law firms. The law firms then will use our professional services for our expert witness work, which we'll come on to later, and and and ultimately get to the client for the financial advice, like this piece to then manage the assets going forward.

5:58 So last year,

6:02 the really highlights for me were we completed three transactions, card will be one of them. SoMek are the, leading, experts in the field of care reports. The care reports is very often the largest report. It not only covers the care requirements of an individual but their occupational therapy needs, physiotherapy, aids and equipment. And these reports can often add $2.03, £4,000,000 with the damages to the claim. Enable is a case management business. Case managers work once the claim is settled. They act almost as a gatekeeper working with the family and the lawyers to put the care package in place to make sure the physiotherapy package is in place to get the right equipment, the right wheelchairs, the right adaptive cars.

6:48 And we also raised £10,000,000 last year, a very difficult market, which was with the support of our our investors. And and even and even though the market was very volatile, our assets grew, across the group to nearly 1,200,000,000. I'm particularly pleased in that the assets in the discretion our own discretion for management business went from 676,000,000 to 715,000,000 as the same was very, very difficult market. And it was this diversification of revenue, this revenue that came from the professional services, which, led to our strong performance last year. So although we were down on recurring revenue from the investment business, we we actually, were able to produce our results based around that diversification of revenue.

7:37 Acquisitions integrated out for the fourteenth year running, we have a 99% retention rate of our clients, which we're very, very proud of.

7:52 So just our financial highlights. As Richard said, last year, the markets were difficult, and we did lose we did have less recurring revenue. We didn't have recurring revenue. However, we still grew our total revenue by 35% and our adjusted EBITDA by 33%. So given the year, given the markets, given everything that's happened, we think we're we're incredibly proud of those results. I think, Lane, just while we're here, do you want to just answer this question on the online? At the end. Oh, sorry. We're doing questions at the end. I'm being told off by my CFO. I do apologize, everybody. Should we move on? So just here graphically, more of our financial highlights. We held our margin, which was, again, considering that we did lose recurring revenue, which does go straight to profit and to cash.

8:41 We we managed to hold our margins, which we're incredibly proud of. And you can see here some of the growth in our AUM just graphically showing how that has has done. We've had a 32% increase since 2019. And, again, as which said, that diversification of revenue streams through our m and a strategy has really stood us in good stead. So our discretionary fund management business is called Accenture Investment Management. Again, it's just just clarifying and reiterating what Elaine has just said about the growth. But I think it's important for you to understand performance. So on this next slide, we have got two on the left hand side is one of our core products, the Safety First Fund. And you can see that's how it performed against the arc sterling balanced asset indices, which shows how strong the performance was.

9:30 But more importantly, on the right hand side is a scatter chart against some of our peers in there. So you've got Charles Stanley, Brown Shipley, Aberdeen, Evelyn, and we're the blue. So you can see we've helped we have outperformed sort of our peer groups so much so over the last three to five years that ART themselves, run a very small investment panel, they get asked to recommend an investment house. They run this small panel, they've asked and approached us to go on that panel, which I think demonstrates the strength of the investment performance. And because of the nature of our clients, because they are very risk averse and they can't go back to court and get another settlement, we are very risk averse. We're very cautious in our approach. So to just give you an example, December 21, there was starting to be signs that maybe Russia was going to invade Ukraine. May or may not happen, but we just take a pessimistic view. So we went overweight cash, overweight commodities, sold off our sovereign debt in the mass allocation move which protected our clients' capital last year and drove through the performance in the discretionary fund management business. So that as a message into our marketplace shows the strength of what we can do when we look after clients.

10:51 So, again, this slide here just shows our income diversification across the different businesses now and the different touch points we have for the client and their journey through. At the start, we've got the signposting. Then as we move through that, we've got expert witness work, which is right at the start of the case. Clinical negligence, PI cases can last a long time. And as we've grown those businesses, we do we do we do have a lot of expert witness work in there. We've got the cost businesses moving into as the claim claim settles the advisory services DFM, and then post settlement as well. The client will have case management, which we can now provide through delivery acquisition enable on our own start up business keystone. So now we can see we've just got all these different touch points and a massive amount of diversification from our income streams.

11:38 So I can appreciate that maybe, you know, if you're looking at us for the first time, this may seem quite complex with the different brands in there. Yes, I get that, but I think if you just bear in mind there's two very distinct parts of this marketplace. There's the pre settlement marketplace, which is where the lawyers are building quantum. They're coming to us as expert witnesses to provide reports. Our duty is to the court. We're reporting to the court and this is very much the professional services part of the business. Once the case is settled, so once it goes in front of a judge and a judge trusts his or her order, that part is finished and then we go into the wealth management side of of our group. So if you if you just think about this as two separate parts, the first part is all about helping the lawyers to maximize or to to get the right level of quantum for the claimant. And what that effectively does is to give us these think about as virtual filing cabinets full of cases where we know there's going to be a big settlement of assets, which is the data we're collecting and we are going to come back to the data in a minute because that is one of the key bits of our growth going forward.

12:54 So we just wanted to give you a size of flail for the marketplace. This is clinical negligence marketplace and, you know, that figure in the bottom right hand corner, this thirty three thirty point three billion pounds, that's the cost. That's not just the compensation. That's the cost of the lawyers fees, the disbursement fees to the experts. So it's a big big number that the NHS are having to pay out. The top end, the catastrophic end which is mainly the wrongful births when a birth goes wrong and a baby's left with brain damage, cerebral palsy is circa about £3,000,000,000 which is the bit that we're really interested in. A billion pounds of pay downs in past losses accommodation adaptations equipment so at least each year 2,000,000,000 for us to go at investable assets, which is where if you take the 15%, we get the 300,000,000 from.

13:47 The next slide is just the personal injury marketplace, the number of accidents and, serious injuries on the road and the seriously injured twenty five thousand people. Now not all of those will have a claim but that's where we get our expert witness work from on personal injury. When COVID hit, accidents did go down there's no question about that but as we all started to deliver get everything delivered online, our groceries, our wine, our beer and our food and trace people back on the roads. The number of accidents increased pretty quickly back to pre COVID levels and by the start of January 21, they were at pre COVID levels. So there was a bit of a dip, but they are are back to where they were.

14:39 So just before we go into the growth strategy, you know, last few years we've raised the 23,000,000. We've we've consolidated and it starts to really bring some interesting data into the group. So you'll see there in the Cardinal acquisition when we did our due diligence and looked at what they've done, the previous three years they had got 65 cases over 500,000 with case sizes ranging from 1,500,000 to 3,500,000 with a total of a 143,000,000 paid out. So we control that, that stream of work now through Cardinal, so it gives us access to lawyers dealing with these cases to not only do our expert witness work but also to then get to the AUM. So, that's happened and now I'm repeating this slide but we're now into the growth which is a slide you saw at the beginning. So this is all about how we can grow the business over the next five years.

15:37 So this is just to show you what we're going to do and it's all about these enhanced touch points. Through the various group businesses, we now have and we'll probably touch most of the big large catastrophes in The UK. So we've got a huge amount of data and using that data is key and Elaine will touch upon that a shortly. A But that data then helps us to drive in our business development market activities. We're very focused on what we do. We know which law firm is dealing with these cases. We know which fear in the law firm is dealing with these cases, and that can help us drive through the AUM. The AUM being the very the margins are are very large in the discretionary business because for every £100,000,000 we put on there, we have to put on a lot of cost that goes straight to the bottom line. So the more assets we can drive in, then that will affect the margins going forward. But we'll come back to margins in a second.

16:35 And the and the real for us, the three key points sort of anyway, three key points that we're really looking is the use of technology and investment into technology. People are key and investment into our people are key and increasing our conversion ratios. If we get all that right, which we we are working to do, we'll improve this across and across the group, that will drive us to the 300,000,000, of of AUM. And just that investment that we're doing at the moment, this is why our margins have remained flat at 25% because over the next couple of years, we're gonna have to keep investing into these particular elements. And once we've done that over the next eighteen months as we go into '25, '26, and '27, Elaine will be working with the different businesses to improve that 25% margin and we see that's another opportunity for us to improve profitability by improved margins.

17:37 So again, just looking at the various pillars there, signpost and service. There are new trauma centers coming up, for tender on a yearly basis. Our target has always been to add two every year. That not only adds revenue, but more importantly, gives us the opportunity to put six more of our partner law firms onto the panel, from the trauma centers. And Elaine is just able to touch on SOMA and Expert Witness and what we're doing there. So expert witness, as a case progresses through, an expert witness is about the quantum of the case, how large is the value of that case, what the losses incurred, what are the costs that need to be done. Who who we acquired last year, is the largest provider of care reports in the expert witness world.

18:23 They have over 4,000 inquiries. To be an expert witness, you're an expert to the court. To be an expert witness in the care report care element, you have to be in a clinic clinical roles. You have to be a clinician either within the NHS or in the private sector. So we currently have 200 associates, and there you get 4,000 inquiries in. They convert 35% of those roughly, and that's just due to increased numbers. If we can increase those numbers of experts, we can increase that conversion. A case in in this field can take two to three years to settle. So they have a long a long life, and that expert then is tied up. So there's a limited amount of case they can do that. So we're working with and the business leads there to to have a recruitment drive so we can increase those numbers of experts and, therefore, by default, increase that conversion.

19:15 Yeah. I mean, it is important. So just just to give a flavor for that, when Elaine sat down sat down with Alice and Soma at the start of the year to look at recruitment budget, they'd only got £25,000 in there, and this comes back to discussion of margins. And we said, well, if you had a £100,000 in that budget, what difference would that make to you? And and as I said, well, it'll make a huge difference because it means we can really go out there and get these associates up to, maybe two fifty, 300, which as Elaine said, we increased that conversion ratio to 50%. We don't need any more work in because we've got that. It's it is about conversion. And so in the cost business as well, the cost business is and I'm I'm very conscious today. I haven't really probably got the time to explain to you exactly what the the nuances of all these different sectors are, what they do, what cost lawyer is, and and how a cost lawyer, really works with the lawyers. And and if anybody does want further information around this, perhaps, you you can please let us know. We can we can let you have that. But the cost lawyers work with the litigating lawyers, provide a very important service as part of the whole litigation.

20:26 Bidwell Henderson, who we bought in 2021, Rebecca Bidwell put a very she took all their training, put it online, did it virtually, and she can take an apprenticeship apprenticeship or a graduate now, bring them in, train them, and within three months, they start to contribute, which is which is fantastic. They were already taking on four new cost consultants a year. Last year or last year, we took 16. The plan is to take 30 over the next fifteen months. And again, the work is there. It's not that we haven't got the work, it's the people because the work is there. So by pulling all these levers, it means that we can increase the, amounts of work, get to them, get to our 50% market share, which fills the bucket, if you like, the hopper in the professional services side to get to that AUM.

21:16 Slight mistake in under the advisory services. That's at a 150,000,000 target this year for AUM in 2022. Should actually say '23. We we only saw that on Monday. But it is about taking all this data and then how do we use it. But the question is, how do we get there to the data which I mentioned will come on in a second. Last bit, and I am gonna touch on m and a in a slide or two, so we will come back to that. But it's unlocking that data and how do we deliver that.

21:48 So, yeah, each of our business have their own sort of line of business system that they use to drive the work through. What's important to us is some key data that we need to extrapolate so that we can take that out to centrally, and then we have a really good knowledge of the market, who is work which firms are working on cases, which individual firms are working on cases, what the quantum is so that we can then do some really targeted m and a and BD. So what we're looking at is, a system that effectively is a single point of truth, single point of data entry that enables people to just tap the data in. The relevant information goes into their line of business unit, and the key sort of high level information that we want at a group level then goes into our group CRM, and we can use that to to really have a targeted BD marketing plan.

22:35 So the best example of the the example I can give you there is firm a may have instructed so much through a care report, have instructed false forensics to do some loss of earnings, may instruct to run the cost businesses across so across the group, we may have had three or four touch points with this firm, and in there, Joe Smith has instructed the customer. Suddenly from the data that we've got up into the group's CRM, we realized that Joe Smith has actually got 12 very high value catastrophic cases that he's working on. Now we haven't we don't know who Joe Smith is and we may have, you know, we may have done some skeptical Martin BD that may have touched him or not, but now that we know he's got these cases and Alison Sohmek for example knows him well, so we can target maybe to get him to a charity dinner. There could be a charity dinner in London for Spire Ninja Association.

23:27 So we invite him to that charity dinner, get him sat next to one of our business development directors, and then you start to build a relationship up with those that individual. So that's that's using the data to be retargeted on who's got the work. It also potentially is on to the other area of the business which really works for us is joint ventures with law firms, is slightly further down there, which I will come back to in a second. The next bit is the knowledge hub. The knowledge hub is how we train lawyers and it's one of the ways we get our message out into the marketplace. Since the turn of the year, we've had 4,000 lawyers have gone through our virtual training. The knowledge hub is headed up by the director of knowledge hub is a gentleman called professor Dominic Regan.

24:13 Professor Dom is well, he he advises the minister of justice. He is well known for his help and and and I mean, over the last week, was lecturing to 250 judges in their their well, their conferences. He is well known as one of the diends of the legal marketplace and he three weeks ago for us, we had 700 delegates on KOPPING online or a heated presentation on costs. So but what the question is, that's great, but then how do we get lead generation? That gives us the access to lawyers. So we're what we're working now is two things really. One, to grow that out even more, but then to generate leads and have a very very automated process to get to the lawyers to get working from from them. And that lead generation of the knowledge hub is again a critical lever for us for growing the business and getting our message out into the marketplace about what we do. The other thing that, professor Dominic Regan I did it with him in Manchester last week, he was out with he had dinner with the master of the roles a couple of weeks ago.

25:22 And the question I also is, are there any risks coming along that could affect our marketplace from the lawyer's perspective and their ability to instruct us? And he actually said for the first time, Richard, in many as you can remember, there's nothing there. There's nothing coming from the Ministry of Justice. There's no change going to happen. So for a long first, I mean, a long time, we've got a very stable, calm water for the ship to to float on. So from our point of view, we know this there's nothing really to derail our plan that's going to come out of legislation or things that we can't control. The delivery service 99% retention rate of client is crucial. We have, our customer service levels in their KPIs. We have a very strong customer service team and in fact in COVID, Carl and Sue who head up that team, some of our clients only contact was with Carl and Sue and so much so that Sue actually got invited to the eighteenth birthday party with one of our clients. So that that constant contact and making sure they remain loyal to the business is crucial and key to the ongoing success.

26:33 And then from there, it's making sure we get in the cardinal panel, we get access to that 143,000,000. And then the last thing we do work on is joint ventures with law firms. We've got nine. We did one earlier this year, Sirius Law and CFG. Basically, we set up a joint venture business, to to drive the AUM through that. So it will, for example, see a serious loan financial services, how we split the profitability of, the joint venture with a law firm. And it's a very for us, it's a very good way of getting distribution to Ascensia. It's a very focused again and the more joint ventures we can have with law firms, the better. Between the cardinal panel and our joint ventures, we have over 20 firms that we've got very strong close relationships with increase it.

27:24 And then the last bit is this technology piece and the data piece, which again is crucial. And for us, this is about efficiencies. How do we direct deliver these efficiencies? So, again, what do we mean by that? At the moment, we've just got, effectively, brochure website. What we're working on this year and what have been done for the last couple years is to get to enterprise websites so that on the enterprise website, it's a digital platform that the lawyers, we have a VPN link into their case management system and they've been structured digitally. As I'm in London this morning, I had a I had breakfast very early this morning with a senior part of a law firm who wants to digitalize his business and wants to work with us so that they can instruct us more efficiently, cut down on on the amount of time that his partners and FENS are spending with instructing experts and focusing on the FENS to drive his profitability.

28:17 So this is this bit is is is again key for us, is laying that digital foundation and making sure we've got the scalability for the future. So I said I'd touch on the m and a strategy. I mean, have done what we wanted to do but I think I'll let Elaine just let you talk you through where we're up to now with the with m and a. So, yeah, so we have as we showed before in the earlier slides, we've now covered all the key areas that we believe in. Where we think we we could do some work, whether it's an opportunity for us is in the care and case management at the end cycle we showed. Case management is, very much, customer led, very much customer focused, and it has to be regional. You cannot travel two, three, or four hours. It just doesn't make any sense. So they are all regional. So we think there was some opportunity there to to cover our to expand our coverage. Currently, we have Keystone, which is our we set up organically, and that's growing. That covers us London. And we also, last year, September, acquired Enable Services, and they are in the Northwest.

29:23 So there is still opportunity for us to increase our regional coverage through m and a. And these are not big businesses. They they are not, they're not the size of something that was they're smaller owned and managed businesses, so we feel we can cope with this from the cash we still currently got on our balance sheet at the moment. So if we move on, this is important because, you you know, our strategy around how we interact with our communities, again, very important. You know, our clients, although they've had a life changing event, I know what someone say is gonna sound a bit strange, but they are the lucky ones because they get a large compensation claim in order to help them with their future quality of life. Unfortunately, a lot of people that don't are not in that position and this picture here is of Marcellus. He is a 14 year old young man. He was playing football in the back garden with his brother and he suffered a spinal stroke.

30:19 He can't walk now. He has got, he has got his hands don't work. That piece of equipment he's on is in, a rehab unit in the Wirral. It's quite expensive. The family just could not afford, to put him through that rehab. So the charity has. We've we've funded his, rehabilitation and that machine will help him get movement and mobility back and make a massive difference to his life. And that's very important that we do through our charity or foundation look to help people, who haven't got access to compensation and within the major trauma centers as well, we give our major trauma centers advisers through the charity a debit card with £3,000 on it and they've got discretion up to £100 to help people again who have not got a compensation claim. That could be anything from helping husband or wife get a taxi in because they can't afford to the hospital, paying for TOPPING. I mean sometimes the clothes have been so badly damaged they can't afford to buy a new set of clothes to go home and it's, you know, some of the stories we hear are horrendous.

31:28 So the charitable foundation is there to help within the trauma centers people who do not have a claim. I think as well for us the charitable foundation underlying everything that we do across all the business units, there is a person who's had a a life changing event. And, actually, we've got a just cause, and the charitable foundation unites all our staff as well. We're all really bought into that message. We have we have people running the London Marathon for it. So it it creates quite community support through it for our staff. It's a really Yeah. Brings us together. Right, Elaine. I mean, even this Monday, this week, our the young lads in the business had a fireside competition with CFG Law, one of our bigger, partners, law firm partners raised a thousand pounds for charity, but also it brought our team together, the CFG team, got a really pleasant team. So it's just this community spirit around our staff and the staff from our law firms.

32:23 And this flows through into our work with our client, you know, with the staff working with them, the well-being, flexiples to work in and it just helps with employee retention. You know, we don't lose staff. We very, very rarely lose staff. We developed our own in house training and learning platform to train our staff. And we are on our way to be p corp certified. So, you know, it is very important to us that that we are here to see support staff and to support our community. Mhmm. So just to summarize, to finish off, you know, where our vision is that we've got in the next five years to get to a 15% market share, driving the AUM, improve the margins, cut diversification of revenue streams as as, you know, support others and we'll continue to do that so well. I think one of the key points to make here is that personal injury and clinical maintenance is not affected by geopolitical events. Unfortunately, people will have accidents on the roads, they'll have accidents, industrial accidents, they'll be fatal claims, and the NHS will continue to make mistakes.

33:30 So we're protected from what's going on in the in the in the greater world. Of course, our assets that we manage, will be affected, the actual core business, the core revenue that's driven from the exact is not. We've talked about the discretion for management business and and, you know, how we manage assets, through that back giving them the smoother journey in defending the capital. And I just think that from our perspective, we've got this this ambitious plans we know we can deliver. I think it's growth strategy, is gonna help drive the business through the next five years. So that's the presentation, but I'm now told by my Elaine that I can answer. Oh, we we do all go back to Alex. Yes. Sorry.

34:16 Absolutely, Elaine. Thank you very much indeed for your presentation this afternoon. Ladies and gentlemen, please continue to submit your questions using the q and a tab situated on the right hand corner of your screen. While the company take a few moments to review those questions submitted today, 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 our investor dashboard. Richard Elaine, as you can see, we have received a number of questions throughout today's presentation, and thank you to all investors for submitting their questions. If I may now hand back to you and kindly ask you to read out the questions and give responses where appropriate to do so, and I will pick up for you both at the end. Thank you. Okay. Okay. So first question, Bill c, underlying profit from operations was 4,300,000 in 2021, 5.5 in 2022.

35:05 Cash generated from operations activities is significantly less. Please explain these large differences, and do we expect cash generation to improve? So we also as underlying profit, yeah, but we've also been on an m and a strategy, so we've incurred cost through that. So that has not been impacted on our cash. Additionally, the PI and clinic cases, they can take over three years to settle, and we're involved in all different stages of those cases. And as particularly the expert witness, which happens quite early on, for SOMEC, FORTH, and FENKEL TOPPING Limited, that that does as we grow those, we will get cash tied up in them. But the other income streams, as they grow as well, their cash comes through quicker. So we the answer is yes. We definitely expect generation to improve as we move through this. But in this growth stage, it's m and a in this growth stage, we have seen large amounts of cash tied up in our working capital.

36:05 So next question is, are law are lawyers that you introduce to clients obliged to use your services? And the answer to that is no. They're not obliged. But if we are introducing the work to the law firm, our expectation is that, in the right circumstances, yes, they will use our services. And I think the more important point here is the relationships we're building with the law firms. It's not just now about the work that we're introducing. It's all those their existing cases that have come from a different source. So there's no obligation, but it there is I suppose the best way of it, there's no obligation, but there is an expectation for them to use our services. And we are the best. Yes. And I mean, I think that's a good point, Elaine. No. The the brands that we bought, you know, we have two we have two very strong mantras before we start this, Elaine and I. For those of you who follow Rugby Union, the all blacks have one mantra, which is no idiots in the changing room. So you can be the best rugby player in the world, but if you're an idiot, then you're not there.

37:08 Spoils the culture, of the team, and that was in fact important to us. So firstly, making sure they had the right culture. But secondly, we went for best of breed in each of the sectors, the strongest brands. So, you know, our again, what we're delivering to the lawyers is in our opinion one of the you know there's not many other places in dogs get a service as good. So that question is how fragmented is the market? Are you looking to mix organic and acquisitive growth? Or is it just capital limits expert witness growth? So the first yes. I mean, the market is fragment and what has been fragmented, but it is you know, we have started this consolidation.

37:58 It is becoming less fragmented certainly in the pre settlement. You know, we're creating we've created the biggest pre settlement delivery service. I mean, there are a couple of others. So the competition pre settlement for us is the handle group, the active group who have done something similar around case management, handle particularly with medical agencies. So they're not exactly the same, but we are the only business that goes from start to finish. I think the other next part about the organic growth you want to do. So we have that's what we've done. We have you know, we're as we grow organically, so we'll grow our AUM because we've got these increased touch points. So then but as they grow, it's the winners grows. We get these increased AUM, and our target 300,000,000 AUM is obviously going through our organic growth.

38:46 Is it it caps at its people. It is people that limit the expert witness growth. I mean, as we said before, so that can have 4,000 inquiries, converting 35% of what would if we can grow that through additional experts, then we can, you know, we can con increase that conversion ratio and increase that revenue growth and the same within. We are a heavily people based business, so that's that's one of our limits, but that's what we're working really hard to make sure we've got the right people in the right place. When I look at, like, who are your main competitors? Is there a big online personal injury presence? So main competitors were in crime crisis. Again, this is the pre and post settlement.

39:31 So so pre settlement, I mentioned HUDGLE Group. I've mentioned active group. You know? So for example, the forensic accountants doing lots of earnings, you know, some of the big six will have a department within there that does forensic accountancy work. So there is there is different competition there. Post settlement, the main competitors tend to be the bigger wealth managers, Brown Shipley, Evelyn, Charles Stanley, etcetera, etcetera. There there's not the the online presence presence per se is not the not dealing with the cases, but, you know, getting the cases. You you you'll probably, seen many adverts maybe for personal injury lawyers for you, that's actually helpline. So there's quite a big headline presence of how lawyers look to generate work through that online presence. Patient claim line is another one, but actually then dealing with the cases now, it then comes to the law firm and has to be done by people in the law firm.

40:33 Does anyone else have a company has comprehensive service all the way from acquisition to DFN? If the cases last for three years, when do you collect your fees, it's only at the end of the litigation. First part, there is no we have we've got first mover advantage in this. We are unique in this regard. There is nobody else doing this, at the moment from start to finish. So absolutely categorically not. Second part, when do you collect your fees? Is it only at the end of litigation? So as we talked about, we've got a range of income streams. We've got the signposting, and that element start. Those fees are paid by the panel firms to us, so that comes in at at point of sale effectively. The expert witness, yes, we do defer that to the end of litigation to to to support that. So that that is deferred. Obviously, advisory fees and DFM fees come in as we as the claims settled, and they're just recurring, and they come in on a monthly basis.

41:31 And then case management, that's post settlement anyway. So, again, that is effectively, comes in as invoiced. I think this is a very interesting point because certainly some of things like false forensics, what limited their growth was these deferred fees that, you know, they they were doing the payment work and they so their their growth was stunted because they just couldn't afford to take on any more big cases because they weren't getting paid for two or three years. As a bigger company, with the ability to do that force are growing, you know, really we've seen them really push on because that would take away that cash flow worry for them. So they can go out and win and are winning some really big money. But also what they are doing as well, winning some mandates from insurers as well and although from our point of view, it's developed with the claimants where we want to get the AUM from.

42:26 Working with the insurance industry demonstrates to the court that we have a balanced approach to this. There is a recent case called MAFA versus the Minister of Defense where this became a particularly relevant issue for the judge in that case and having that balance of expert witness again is a big advantage to us. So we cover both sides. Work within the claim and ultimately your duties as an expert witness on the civil procedure rules 35 is you have to give a balanced professional view of what is in the best interest of the claimant, not maximize it for the claimant or not demaximize it for the insurance, for the defendant. It is what is needed and required and that is your duty. Actually working with both insurers and claimants and there's a lot of what's called joint handling agreements now in place where insurance industry insurance companies are working on a joint approach with the climate lawyers, but it because it cuts down on costs and ultimately the climate gets a better outcome.

43:29 Can you give more detail on the process of securing longevity within a stress trauma centers, please? This seems to be crucial to securing new clients outside JV within the law firms. Yeah. The contracts within the trauma centers are three years. The core seven that we had originally just virtually all renewed their contracts for three for the next three years. We we've won the the two just last year, Birmingham Children's Hospital and it's called, I think, I want to say. And so that's for three years. But, you know, yes, these will come up for renewal for every three years, but, it's up to us to continue to deliver that message. The pro bono work we're doing with the non patients who don't have a claim, you know, really puts us in a in a good stead with the NHS.

44:22 We know some of the so some of the charities are in the trauma centers. The NHS tried to do it themselves with the trauma centers and are doing it very badly. And in fact, I can't because I've got an NBN place, I can't say who, but there is one trauma center we'd note later this year is effectively firing their existing provider and coming to us because of the reviews we've had from the trauma centers we're in. But of course, there's always a risk there and it's up to us to make sure we continue, to provide the right level of service for the hospitals. How is essentially progressing with the new FCA consumer duty requirement? Yeah. I mean, our complaints to Denise, director of compliance is is, you know, we've we've been on that since day one. You know, we're working through that, and, you know, we take it very, very seriously. And, you know, we we are aware very, very well that, you know, I think we're really there, aren't And we've got ex we've taken external advice where appropriate. So, yeah, something that's constantly, you know Oh, my. Yeah. Like, they've said, it's still advice on that. So we feel very comfortable with our obligations under this consumer duty.

45:29 And I think that's it for questions. That's great, Elaine, Richard. Thank you very thank you for being so generous with your time there. And I believe you have addressed all the questions from investors today. And of course, the company will review all questions submitted today, and we'll publish those responses on the Invest in Me company platform. But perhaps before we direct investors to provide you with their feedback, which I know is particularly important to the company, Richard, could I please ask you for a few closing comments? Yes. I mean, yeah, just thank you for joining today. As I say, it may seem complex, our business, but it's not. We see it quite simply as, you know, accessing the claimants, managing the assets in the right way. But I'm more we're more than happy if anybody does want any further information, you know, through Investor Meet. If you want to request it, we're more than happy to give it to you. But thank you for attending today.

46:19 We appreciate it. Thank you. Richard, Elaine, thank you once again for updating investors today. Could I please ask investors not to close this session as you will now be automatically redirected to provide your feedback and order that the management team can better understand your views and expectations? This will only take a few moments to complete, and I'm sure will be greatly valued by the company. On behalf of the management team of FRENKEL TOPPING GROUP PLC, we would like to thank you for attending today's presentation. That concludes today's meeting. Good afternoon to you.