Fusion Antibodies (LSE:FAB) — Full year results briefing

0:00 Good morning. Welcome to the FUSION ANTIBODIES PLC Investor Presentation. We begin, I'd like to submit the following poll. Now I'd to hand you over to the management team, Adrian. Good morning, sir.

0:20 Good morning. Thank you, Charlie. So my name is Adrian Kincaid. I'm the CEO of FUSION ANTIBODIES. I'm joined today by Steven Smith, who is our interim CFO, although has been with us for quite a while now. So welcome, Steven. Thanks for all the support. So we're going to take you through the results presentation for the year ended March 31 following the full audit required, and much of the the results have actually been out since we did the trading update, but now they're they're audited. So we'll follow the the usual format, and I just need to remind you of our legal obligations and the disclaimer that's on screen here. Thank you very much for me reading it.

1:14 And I'll hand over to Steven to take us through the income statement. Thank you, Adrian. Yeah. And by way of introduction, as Adrian said, I'm Steven Smith. I'm the interim CFO at FUSION. So our interim, our income statement extract, for the financial year ending March 3126, showed revenue increasing by 7%

1:44 to just over GBP 2,100,000 in the financial year. It's important to add that there was this revenue for 2026 did include a one off GBP 2 and 50,000 IP transaction, with, Finn Therapeutics. So there was £250,000 of revenue that was, I suppose, outside of our, I wouldn't say our normal scope, but outside of our previous activity, in the current financial year. So if we exclude that, IP transaction, other operational revenues were down marginally, year on year, which, I think, reflecting continued pressures across the biotech funding environment.

2:31 And what we've seen is a longer customer decision making cycle from discussing deals to pressing go. The gross margin or gross profit, sorry, increased from $400,000 to just over $1,200,000 That resulted in a margin increase of from 22% to 58%. Now obviously, again, that margin was influenced by that one off IP transaction. However, there were changes in product mix, operational efficiency. There was some higher value service work and an increased contribution from grant funded activity and other small nonservice income streams.

3:21 So I think it is important that the improvement in reported margin should be considered in the context of the one off piece of revenue through the IP sale and changes in the revenue mix. So our EBITDA loss for the year was just over 1,000,000. So that was an improvement of just over 500,000 on the previous year. So again, the reduction in EBITDA, it reflects changes in in the gross margin above the company's operating cost base during the year. It's worth noting that this reduction in EBITDA loss was achieved alongside continued expenditure on the commercialization of OPTIMAL and broader R and D activities.

4:16 The investment in operating costs that sort of bring us from gross profit to the EBITDA loss that aren't included in the income statement extract. So I add a little bit of color on those. So operating costs actually increased during the year, which reflected the expenditure on the Optima platform development related validation activities, significant grant funded R and D programs and commercial readiness activities. Total R and D spend in the previous fiscal year increased to approximately GBP 861,000 compared with GBP 191,000 in FY 'twenty five.

5:06 So that was, again, sort of primarily as the result of the full rollout and implementation of the FMI and Innovate UK grants. So this increased R and D expenditure represents a significant increase in investment compared with the prior year and obviously contributed to the overall cost base. I will move to the summary financial position or balance sheet. Net assets, if we look to the bottom initially, net assets increased from, 756,000 last year to, just over $1,650,000 or $1,660,000 at the March 31 year end.

5:56 The increase was primarily driven by the January 26 equity raise, which increased cash reserves at year end and a mix in changes in our overall working capital position. Cash increased from 400, $403,159,000 at the previous year end to just over $1.040 at the current year end. I would say that higher year end cash balance provides additional liquidity for ongoing operating commercial and R and D expenditure. At year end, current assets were approximately 3x current liabilities, indicating a higher level of current assets relative to short term obligations.

6:51 This position remains obviously subject to the company's ongoing cash requirements and operating expenditure. Our receivables, we'll put the inventories first. Inventories, higher at the current year end, three sixty two versus two sixty nine. Receivables, $9.66 versus $7.19. So receivables comprised, of 144,000 of a corporate tax receivable. There were 530,000 of debtor receivables.

7:38 That 530,000 is net of a significant bad debt provision. Gross, pounds $9.38 with a GBP 408,000 provision. The bad debt provision is largely related to the GBP 2 and 50,000 due from Finn Therapeutics. While we expect to collect that amount in full, it was, deemed prudent to provide for it, through our year end audit. We have $174,000 in prepaids, and VAT receivable and, 117,000 in accrued income. The current payables, of 842,000 versus 623,000, last year is comprised of 488,000 of trade creditors, 212,000 of other creditors, including accruals and PAYE, national insurance liabilities.

8:44 And then we have a 100,000, which is the current portion of our HP liabilities and our office lease liabilities and $41,000 of deferred income. Our noncurrent payables are the long term portion of our office lease and HP liabilities.

9:10 Our statement of cash flows, cash used in operations decreased from $1,360,000 to 1,100,000 So again, that reduction is it reflects changes in gross margins, operational expenditure and working capital throughout the year. Operating cash flow our operating cash outflow, nonetheless, remains significant at $100,000 for the twelve months to March 31. The reduction in operating cash burn occurred alongside a substantial increase, as I said earlier, in R and D expenditure. Part of that, obviously, was supported by government grants.

9:57 Investing activities increased modestly to 58,000 that related to a particular piece of equipment. Limited investing activity throughout the year. Financing activities, the 1,855,000,000 was the net proceeds from the 2,006 fundraising activities. Those proceeds were intended to fund optimal commercialization, market and business development, the equipment purchase that I noted above and, of course, general liquidity requirements. So the year end cash position increased by $684,000 went up from $359,000 to 1,043,000 Again, you know, largely reflected through the fundraising activities and then the cash burn used in operations offsetting that. So I would say, in conclusion, before I sort of pass back to Adrian, while cash used in operations reduced during the year, the business remained cash consuming and EBITDA loss making.

11:25 The increase in year end cash was principally supported by the 2026 fundraise with cash closing at just over $1,000,000 The cash position provides funding for ongoing activities, but the level and duration of available liquidity will remain dependent on operating cash requirements, R and D expenditure, future revenue generation, or future financing activity. So, Adrian, with that, I will hand it back to you. Thank you very much, Steven. I noticed that we've been asked, a question concerning grant income, so I thought that was worth just highlighting here before I go on to the main part or my part of the presentation.

12:14 The 2,110,000 revenues does not include grant income. So that is is something that maybe some other companies do, but we don't. The 2,110,000 is recognized revenue, not not grant income. So just wanted to clarify that. Okay. So moving on. We are in a very challenging market. Many of our competitors have actually not hit or got even got close to their their targets. And in that regard, I think FUSION has actually done well in the in the year to March 26. Since then or or starting in March, there's also been some further adverse effects which have impacted a very wide range of of businesses, not just in our sector, but more globally.

13:15 You'll be familiar with Richard Branson's recent comments, no doubt. However, it's worth bearing in mind that thus far, interest rates or central bank interest rates in the key markets have not yet risen. And we are hearing anecdotally that growth is said to be be returning. Not sure what's happened on the slides there. Apologies for the slides. So there are some some good prospects, but there is no denying that market is very difficult. That means that when we're up against competitors, which, of course, we offer pretty much every project that we're we're pitching for, we find it being increasingly competitive.

14:06 And therefore, what FUSION needs to do to keep winning business or or win more business is to offer proprietary technologies which have advantages and benefits to the end user. Clearly, being proprietary, they can't be had from elsewhere. So we have something that really differentiates us in the market. Where we're talking about generic services, and there are a number of those, particularly the most frequently questioned one is the transient gene expression. So that's where you wanna make small quantities of antibodies for testing. Each of those antibodies is relatively is considered relatively low value. But what you want to do is get them tested quickly and cheaply, and other companies have been offering faster services than us and at lower costs. So those faster services and lower costs is something that we at FUSION needs to to match.

15:04 So what we've been doing about it to meet those challenges, well, in the proprietary offerings, we have our Optimal platform as the flagship platform, and it's worth just dwelling on what that means to us more widely as well as the potential to sell Optimal deals. Opti designed libraries are very advanced. They introduce natural naturally occurring somatic hypermutations. So these are changes in sequence that are outside the obvious areas on an antibody. It's an extremely involved and really elegant piece of science that's behind that, and that's one of the reasons why the initially designed Optimal library is as large as 10 to the 45, so absolutely mind boggling bogglingly large.

15:59 We can apply that method, which is patent protected, including in The USA, Japan, and Canada. We can apply that method to other libraries. So we can exploit that and effectively make additional proprietary libraries. Optimal and the initial naive library that we offer with that. Naive meaning that it can be used against any particular targets, not biased towards one particular structure. That's only the first offering of the Optimal libraries that we have. The other thing on the proprietary platforms and then the Optimal in particular is our mammalian display platform, which is best in class and offers distinct advantages in terms of its performance and, in particular, the efficiency with which it expresses antibodies from sequences that are put into it, and that's really valuable. It gives you much more confidence that a sequence has made it through. And if you don't get binding, you can be much more confident that that sequence was actually at fault, and that negative data is often really helpful in supporting what you know about the positive data of where hits have been found. We have a distinct advantage with mammalian display compared to any of the commercially available alternatives.

17:22 Faster timelines and more competitive costs though is something particularly for generic services like I say, and this transient gene expression has been a real bugbear. So we are looking for small quantities of antibody at high throughput. We have now started rolling out a revised process for that, and that's being offered to clients now where we've reduced timelines, which had been as much as nine weeks down to about three weeks. So it's much more compelling and a much more improved proposition to our clients, and that is matched because we've taken out a lot of the labor costs. That's matched with more competitive pricing.

18:09 What I'm expecting that to mean is that we will win more projects centered around TGE, which involve TGE. Sorry. And that will allow us to get improved take up of our adjacent offerings. So we do the engineering design first, and then we express small quantities and test those antibodies. So the engineering will be looking more competitive as well. And, also, once we've expressed them, they choose the antibody that's of interest and then take it on for further tests, and that requires a scale up of the antibody production. So I expect that we will retain that much more. So I think as a single area of improvement and certainly following feedback that we've had from our client base, this is what they're they're wanting. So having pitched that back to the clients, the clients are responding and saying that's that's what we asked for. That's much better. And they are now engaging with us in a more positive way than we had before.

19:12 So we think we've eliminated one of the roadblocks to successful conversion of leads into projects. Time will tell. Another area where we've really hammered the timeline is the much higher value cell line development area. So cell line development comes in when an antibody has been nailed down. This is the antibody that they want to take into production for under controlled conditions with manufacturing practices or GMP, and that enables these antibodies to actually go into clinical trials and samples of the antibody to go into people. Nothing we produce goes into people because it's we don't do the GMP stuff. That's a kind of different business set. But what we do make is the cell line that can be taken into that production.

20:11 As such, it is really quite high value. There are significant chunky contracts that when we get them for for this sort of approach. Some of those have been RNs ed in the past. And what we have now is a cutting edge microfluidic technology available to us through the FMI grant in Belfast that allows us to really modify and really change the way cell line development is run. So those processes in terms of timeline have reduced that from about eight to nine months down to four down to four months. So it's taken four to five months out of it, half that timeline. And that is really significant. We're seeing a lot more interest now in that. Of course, what they want to see, the clients wanna see is case study data for it and not just the hand wavy. This is what we are told we can do with this new equipment. We really need to show them that we've we've done it.

21:15 And we're in that position now courtesy of the d r five grant that we have that's allowed us to do our own cell line development. So we have shown and we have case study data which we can use and are using in marketing those services to the clients that are interested in cell line development. It is also worthwhile pointing out at this point that all of this r and d work that we're doing on our own processes is covered by the FMI grant. So we're claiming back for for that work that we've been doing. And the d r five grant is specifically for that project, but it's also given us the opportunity to run case study data develop case study data to support these these new technologies.

22:06 So that puts us in a much improved position to meet those challenges that we're facing and everybody else is facing in the marketplace, but we're improving our competitive position. So the d r five project itself, the gentleman in the picture here is professor Chris Scott from Queen's University Belfast. He's one of our collaborators on the project. And this photograph was taken at the recent Elrigg conference in in Belfast. He did an absolutely excellent job of describing the biology and why it's such a good target and of so much interest to pharma and indeed why Amgen's lead product wasn't able to do effectively what our antibody can do, at least in the test that it's gone through so far.

22:58 So we started this project with actually a remarkably remarkable hit antibody that was shown to be effective in cell based assays without the need to conjugate it onto another substrate, so a nanoparticle, for example. And that was what was required to make the Amgen antibody work. It's quite a compromise to do that conjugation. It makes cost of goods much more expensive. It makes it more difficult and more challenging to get the the work done. But the target was sufficiently attractive that Amgen followed it followed it through. Unfortunately, they then ran into some problems, so that leaves the pathway open for other companies with other DR5 antibodies such as ours to go forward on the second generation of antibodies.

23:48 So what we've been doing with our remarkable HIT antibody under the grant funded by Innovate UK has been to develop much more complex antibody design structures that really enhance the efficacy of the antibody using cellular models as the main sort of process binding and then cellular models. It's worth pointing out that more complex antibody structures are showing and coming through the drug development pipeline more widely. So having case study data for this exemplified by the d a r five project and everything that we've shown there is really important and shows that we've got technology and a project that we can talk more openly with with our prospective clients about to really showcase what we can do. We see if we're doing it for another client or under NDA and it's we're not allowed to talk about it.

24:49 It would be inappropriate to talk about the detail of somebody else's antibody and and the complex engineering that we've done, and that's where the grant project, the d r five in particular, really allows us to do that. And, of course, as I mentioned earlier with the cell line development, it's really excellent examples to showcase how we've taken a whole four months off the development of a cell line using d r five as an example case. So where is the project at the moment?

25:17 It's currently undergoing evaluation in animal models. So these are xenograft tissue models where effectively a human tumor is implanted into a mouse, and then that mouse is being treated with antibodies. It is too early at this stage to say what those results are gonna be. We are waiting with a great deal of interest. And when we have those results, we will be updating through an RNS on the on those findings. If and it is a big if, but if that proves to be positive and we get the results that we want from those xenograft models, we'll we'll have delivered what the grant set out to do, and we'll have a potentially licensable early stage asset with very good prospects for much more generous milestone and royalty reach through as well as upfront payments than we could possibly have got from something where we had partnered it with someone at the discovery stage effectively where they paid us the the fees to go through the the the process. We've done it off our own bat, admittedly, with the the grant funding.

26:33 So it's a really brilliant project. It's a cost effective way of generating case study data, which we need for marketing purposes, but also we potentially have a licensable asset, which we hope, if the results come come through the way we want them to, has distinct advantages over other lead molecules such as the Amgen one that I spoke about earlier.

27:04 So the other area that I think we've got a lot of scope for improvement in design and growth is the Opti design method. So these are the proprietary methods protected by the patents. And some of the areas that I think we particularly have scope to develop these is, for example, focused libraries. So certain target classes, GPCRs are one that are used. Typically, they're membrane associated proteins that signal across the membrane. And certain antibodies have been shown to bind and potentially activate or block those those GPCR proteins. Theory is that if you have a certain length of the c d r three part of the antibody, then you have an improved chance binding and modulating GPCRs just as an example.

28:04 What we can do with the OptiDesign is really focus on that and mimic or or base things on theories like that with the GPCR. There are many other theories around other targets and around other theories around GPCRs too. But what you can do then is really focus in on a focused library approach, and it's very successful or has been a very successful method particularly used in small molecules that we can mimic using antibodies. And introducing the optidesign and the somatic hypermutations adds in much more diversity, makes them much more human, much more like a fully evolved antibody that the body would produce within potentially improved benefits, efficacies, etcetera. So I'm very excited about this area of of growth, and it's pin underpinned now because of the proprietary pattern protected method that we can do.

29:04 So we can grow and build on this proprietary platform that we have. Same can be said for fragment based libraries, so we don't just have to do the full length, fully intact IgG, full antibody molecule. That's the most challenging thing to do, so we needed to nail that one down to show that we had the right diversity. But we can do the same design on of OptiDesign on fragment based technologies. If those fragments are more simple, shorter chains, maybe even single chains, then we can use much larger libraries in more simple expression methods. You don't necessarily have to go for the mammalian display. So we're opening up more markets with proprietary libraries going through this this sort of strategy.

29:55 And then a third area, of course, which is tagged as being a major growth area for the antibody discovery market is AIML designed cause. So AIML will come up with with a fundamental sort of beginning point design, and then you want to really explore that chemical space structure activity relationships with different substitutions around to really explore what could be done. And that will lend itself to the OptiDesign approach too. So I can see us being really well positioned for AIML as well as more traditional sort of in vitro based screening methods.

30:42 So just wanna remind you that that Opti design method and is patent, sorry, is really important to us and potentially very valuable. So in summary then, yes, 2026, FY '26 was a challenging year for FUSION. However, we, by and large, met our targets. We're slightly under if if you wanna be pedantic, but close enough. That was in large part due to an IP sale, which meant that revenues increased year on year by 7%. If we take that IP sale out, then yes, they did decrease by a small margin, 4%.

31:31 The margins have been significantly improved, 58% from 22%. If we take out our IP sale, which is obviously very flattering to the margins, we're still at about 44 43%, so nearly a doubling of margin from where we were. So much more efficient running of the business because of the mix of work that we're doing, and we can allocate some of the costs to those those grants.

32:01 On the grants and post March 31, we've continued to make progress with the d r five, excellent progress with the d r five project, providing that all important case study data that we can feed back into the marketing and commercialization of a lot of our offerings as well as if that data comes through the way I want it to, we all want it to, we have a potential early stage asset as well. The FMI grant funding is for supporting the refinement of those offerings and improving our competitiveness. So that puts us in a really great position. And of course, with the r and d expenditure, we also have r and d tax credits to claim too.

32:54 The market challenges do persist, and they are impacting h one. So, obviously, the geopolitical factors really started in March and started really hitting the the clients whose immediate responses to delay. We're not quite sure how long they were delayed, but as Stephen was saying earlier, the sales cycle process has been lengthened by factors that are really outside of our control. We're doing everything that we can to make sure that we bring those on board and make ourselves more attractive, more competitive, and can win more business. We're doing that without changing the the the workforce. We're using the people who would be doing the processes to actually improve those processes.

33:48 They're good scientists. They're excellent scientists. And as you can see from the results that I've already explained, they've had some very significant impacts on on how we do it, including the timelines for CLD reduced by four months and timelines for small scale TGE reduced by as much as 60%. On top of that, grant of patents really strengthens our position, that proprietary nature, which is a gateway for us to really change our value proposition. If we are the sole patent protected offer of a proprietary technology, so long as the client wants it, they have got to come to us.

34:34 So, overall, I think FUSION is positioning itself much better, much more competitively, and with much more attractive offerings than we've had before. What we need is for the market to improve for some of those breaks and delays to come off, And then I think the prospects for FUSION are much better than they have been. So we're looking forward to, as I'm sure many of our investors are, looking forward to much better times ahead. Brilliant. Thank you very much. I will stop there. That's the the last of the slide set. So Perfect. Thank you for updating investors today. Could I please remind investors to submit your questions just by using the Q and A tab situated on the right hand corner of your screen.

35:26 And for your reference, a recording of today's presentation will be available on the Investor Me Company platform shortly after the meeting has ended. As you guys can see, we have received a number of questions during today's presentation. If I could just hand back to the team to read out the questions and give responses appropriate to do so, and I'll pick up from you guys at the end. Okay. So, Steven, if you could check on the more recently submitted ones just in case there's anything there. I think from what we saw in the presubmitted ones, I'll I'll be handling most of those because they're quite understandably dominant looking for future prospects. So I can kick off with with the first of those. The question is that in September 2025, FUSION said that the NCI, National Cancer Institute, had requested an extension of its use of Optimal for further targets.

36:16 Can you give shareholders a clear update on where those discussions now stand and what, if anything, remains to be resolved?

36:24 So the negotiations are ongoing, and I don't wanna say anything that will compromise those very important negotiations. But they are likely to result in FUSION holding a commercial interest in the antibodies resulting from those optimal screens in the NCI's labs. So the NCI are gonna do the work, and we will have a commercial interest

36:52 in the antibodies coming out. At least that's the way it's shaping up. Of course, we won't know for sure until the deal is actually done. It is worth pointing out that the NCI is a very, very well placed and influential public body in The United States, which has access to a vast network of academics and clinicians, which it uses to generate data of the absolute highest quality and, therefore, value of the the assets. So we remain very keen to continue working with them. We really couldn't get a better partner for this stage of the of OPTIMAL's development.

37:38 However, I am very aware of the frustration and share the frustration that some factors, particularly those ones that are outside of our control, such as governmental shutdowns, have had in slowing the progress of the negotiations. So I'm not able to put a timeline on those negotiations themselves. As we've disclosed in the f y twenty six results, the formal agreement being negotiated is expected to cover screening of the OPTIMAL library against an agreed number of targets with joint rights to the jointly discovered inventions such as those antibodies. Despite ANTI doing the work, they're using our

38:23 library, so they are joint discoveries. So they we have a commercial interest in those things, in those antibodies being found. But there can be no certainty on the timing, especially given the political and administrative challenges that are affecting the NCI. We are from time to time updated on progress with the scientific work on OPTIMAL that is being done at the NCI and the results continue to be favorable. They're finding antibodies with suitable binding affinities. Those are within the range expected for commercially viable antibodies. And with the recombinant antibodies, so the ones re expressed as free floating antibodies as it were, binding their targets in relevant human cell models, very much like the work that I've described with d r five.

39:20 The NCI's next step is cancer specific cell based assays to assess therapeutic potential, and where necessary, they will go on to animal models too. So next question was, what do you believe is currently the biggest barrier to converting pharma interest into paid optimal programs? This is a good question. It's a challenging one, but it's something that we spend a huge amount of time really analyzing and looking into. So aside from some nervousness due to the geopolitical and economic environment and people delaying their decisions, I'd say that a publicly stated validation from the NCI backed up by data would be really impactful.

40:14 That has been delayed whilst they are filing patents, and, of course, they don't want to prior art those patents by putting that data into the public domain. So it's just one of those things that we we have to wait for. And I would say that that's the biggest factor, which is really hindered conversion of interest into deals. We go out, speak to clients, tell them that it works, tell them that it works in the NCI's hands. We would say that, wouldn't we, is the kind of response that that we get. So I think the NCI work going into public domain is really important. It's not a question of whether the platform has generated encouraging scientific results. The NCI work has continued to generate strong data. It's the publication of that data that we're really pushing for, and I think we'll push some of our clients just over the line and get those signatures onto onto proposal documents.

41:21 Moving on then. What would management regard as the key commercial validation milestone for Optimal over the next twelve months? Similar sort of theme to it. Would that be a major pharma contract, a certain number of paying customers, repeat programs, licensing income, or antibody progressing towards preclinical development. Some of those would probably take more than twelve months to come through because it it is a fairly involved process. But let me answer it in two different ways. So first of all, our clients are scientists. How do they see it? From a scientific point of view, they would say that an antibody progressing towards clinical development is probably the the best sort of validation.

42:12 From my perspective, in the commercial point of view, so commercializing that platform, it's the availability of third party data demonstrating utility of and faith in OPTIMAL. Obviously, the paid access to that is with commercial sort of meaningful commercial contributions is really important, and that would be very valuable validation of the platform. So I think there's a mixture of all of them, and it depends on your point of view. This one follows still on on Optimal. If you had to identify one feature of Optimal that you believe would make a pharmaceutical company choose it over phage display, yeast display, or other mammalian display platforms, what would it be?

43:14 It's a really great question because there there are so many benefits to the Optimal platform. And it's it's kind of when we introduce it on a scientific level to potential clients, it's one of the things that we try to identify and how they are looking at it to see which ones seem most relevant to them. So different pharma company clients have differing views. We know that from feedback that they've given us, and it depends largely on their targets and their experiences. So when we see something that's similar or sounds similar, we can focus on the more important things for that biology.

44:00 However, if we classify them together and we're looking at human therapeutics, obviously, then I would say it's the need for a human or potentially humanized antibody. You don't need to humanize an antibody out of Optimal. It's already human sequence. So this is what OPTIMAL can deliver right from the initial screen. This improves confidence in the output, the hit antibody itself, and can reduce timelines and risk and reduces risk as no humanization is is required. So just as a reminder, Optimal combines fully human antibody library, an absolutely vast one, with mammalian display so that full size human IgG sequences are expressed on mammalian cells from the discovery stage.

44:53 This means you're screening against the actual endpoint that you're looking for and that shortens the route to a lead human antibody and it reduces the risks with negating needs for later engineering or many of the engineering aspects or trying to stitch together antibody fragments for non or taking nonhuman antibodies. So there's multiple advantages to optimal. I think some of the next questions we've kind of already been addressed, and I've got an eye on the time, so I'll move move on. You previously said you planned to engage with the AIML sectors and conferences on with mammalian display.

45:45 What progress have you made? Well, we've done that, and we are actually looking forward to attending the AI drug discovery and development summit for 2026, which is in Boston in late October, so a month and a half away. In the meantime, we've also been working on at least one particular collaboration with an AIML company and have data resulting from that, which exemplifies the utility of mammalian display to AIML clients. We've been doing that data with a view to using it at the AI drug discovery and development summit in Boston so that we have real data that we can talk about with those clients. So it's getting our ducks in a row before we go on display.

46:35 Now I believe that AIML will be a very significant growth sector within our market. I believe that we've got a really excellent platform to complement that. So not only will we be offering sort of services to end clients, so the pharma companies and the big biotechs, but also to the AIML companies to partner with them to progress their advanced AIML algorithms. So in addition, we have our own AIMLAB antibody platform. So that's AIML AB for antibody AIMLAB, which uses or can use the same mammalian display technology that you find with OPTIMAL.

47:22 And that expresses experimentally those tests those full length test antibody sequences developed by or generated by the AIML approaches. So we're generating case study data to really show that that approach and show that it's real, and we've we've done it. So it makes it a more compelling argument when pitching it to such AIML companies. Okay. Next one. Is it time for FUSION to publish its own case studies and in journals on OPTIMAL given the length of time it's taken for NCI to publish their work? Well yeah. It has taken longer than I would have liked for the NCI to get out, but larger than that is due to the patent filing.

48:14 So, actually, it's gonna be better and more impactful results when impact when it does come through. So but for us and the work that we're doing and the kind of publications that we go for, Our focus has been primarily on the more commercially relevant channels. So posters where you can actually discuss face to face with interested scientists. That's where we get our hook and we start to build the relationship and bring in prospective clients on a scientific engagement basis. It's really important to get to that scientific engagement as rapidly as possible, and posters are a brilliant way of doing that. We've also done presentations at conferences as well. I showed you the photograph of of Chris Scott presenting on d r five, but we have also we also had a presentation at the same conference on Optimal.

49:10 So we have got presentations and posters, and that's been more of a focus for us than peer reviewed publications with their sort of very prolonged process to actually get that data out in front of people. That said, publication from third parties such as the NCI are far more impactful than any commercial company can produce about their own products platforms. It's that third party nature of it that really helps in terms of moving the deals forward or the potential deals forward with with clients. Next question was, is management currently confident that the European and Chinese applications will currently be will ultimately be granted?

50:00 Not going to make predictions on this, but my confidence in further patents being granted in additional jurisdictions grows with each one each award that we get in in the granted geographies. So I'm very pleased with the progress that we've made to date and really look forward to small patents being granted. Don't forget that The US patent that we applied for was on an accelerated scheme. We got that done as quickly as we could. Not all jurisdictions do that, and that's possibly one of the reasons why some of them appear to be taking a little bit late longer. But it's all good good progress so far. Next question. Is the board concerned about the progress that has been made since launch launch of Optimum, the fact that no material contracts, in other words, RNSs have been secured?

50:56 Do they need to adapt the way they're do they need to adapt the way they approach sales and perhaps the how the sales team operates? Of course, the board is concerned, and the commercial approaches are under continual review. We're looking at deal structure. We're looking at ways ways we can position things. We're looking at really trying to get their clients to come over the line other things that we can do to adjust the the efficiency of what we're doing and therefore the price point at which we offer it as well. So the board recognizes that the level of commercial conversion since the launch of Optimal has been slower than we would like. We therefore continue to invest in dedicated sales and marketing, broadening the customer break base and targeting companies that previously we would struggle to to see.

51:58 So we're building up relationships with those people from a a lower level than I would have liked, but that's where we started. We're increasing engagement with larger organizations and improving our related services as well or particularly around speed and costs. So I think we're doing quite a lot actually to address all aspects of the business, but some of that, of course, a lot of that is gonna be impactful on uptake and success of Optimize. So we're already making improvements. Pressing on then. Why has the revenue growth been so low in the recent financial year, particularly in if you exclude the one off IP deal? So the underlying revenues, which were actually down 4% year on year.

52:50 How are you going to achieve much higher rates of revenue growth? So, yeah, the market has been challenging, and we've lost out to low cost, high higher speed offerings from competitors, which is why I'm so pleased with the improvements that we've made to our own offerings. And I really do look forward to those improvements feeding through to more commercial success. The market itself is very large, and we're only getting a very small percentage of it. So we believe that growth in that market is coming as we improve our offerings. In addition, with the right proprietary technologies paired with those fast timelines and cost effective pricing, we are really very well positioned or increasingly well positioned to take advantage of a rising market once the brakes come off.

53:47 And we will continue to make further improvements to the way we do stuff to bet to seek a better match of our offerings to the evolving needs of the marketplace. The marketplace isn't a fixed target that we're aiming for. A lot of people's ideas such as talking about earlier with the more complex antibody structures is really relevant, and we are mindful of that. We're listening to our clients and what they want and positioning FUSION in the best way possible to take advantage of that. So our proprietary technologies such as the OptiDesign libraries, I think, provide a platform for significant growth and to position us as a leading provider provider of antibody and antibody fragment libraries.

54:45 Just gonna move on. Oh, how much of the d r five asset, assuming it is an asset? We haven't got the final results yet. How much of the d r five asset does fusion own versus QUB? That's antibody which is being tested. In fact, there's there's three different antibodies I'm particularly intrigued by and interested in. The best of those would be the putative ATA, and it is 100% owned by FUSION. I think we're running a bit short on time, so I'll try and speed some of these up. You stated one of the purposes of the placing was to invest in strategic partnerships. What strategic partnerships have you invested in? So we're exploring several such opportunities centered on what we believe are growth markets, but we're not yet in a position to go public. We will announce any strategic partnership when it reaches a stage where which disclosure is appropriate and material.

55:58 Similar to that one, you announced a collaboration with a US based AIML business in 2023. Can you tell us more about this and how the partnership has progressed? We've got a very good relationship with that company, and they've helped us develop a much better understanding of the AIML market, and I dare say that we've helped them understand antibodies a lot better as well. The collaboration has helped us inform and develop the positioning of AIMLab, which combines AIML design sequences with our proprietary mammalian display capability so that full length antibodies can be expressed in large numbers and tested experimentally.

56:46 The negative results from those are as influential in many ways as the positive results and having faith that negative result is a negative result really informs the algorithm in its next iteration. So we continue to continue to see AIML as an important growth area, and we are generating data and case studies in collaboration with the The US based AIML company that we partnered with to demonstrate the value that FUSION can provide to companies developing antibodies using computational methods. I think that's the end of them. Steven, sorry, I've left you very little time, but are there any further ones that you were able to spot?

57:34 Yeah. There's a there's a lot of questions, Adrian, on where we're at with NCI optimal optimal validation. How do you envisage optimal to be commercially structured, upfront fees, annual free fees, milestones, royalties? So you've probably answered quite a bit of that, but that's one to covers quite a lot of the the live questions. There was another, how would you assess competitor products or AI risk to the FUSION suite of products. I think those those two sort of would be the main if I could distill it all into one minute, that would be that would be the the the theme.

58:24 Okay. I've just scanned down, and one of them jumped out at me. And I think I know who it's from. Why on earth don't you do more work like the d r five? It sounds like this is where your skill sets lie. Thank you very much for confirming that our case study data is bang on what we need it to be. That's why we did d r five to make sure that we can do exactly that kind of work for our clients. We needed to land a grant to be able to do it because we're not funded directly to do that kind of work. So some of the some of that has been limited to winning grants. We're going to continue to apply for grants like that.

59:09 And, hopefully, with money going into the the grant funding sector, we can do more like the r five. But I really appreciate that because that shows exactly what we wanted it to do. So thank you. Okay. I think we're out of time. So I'll hand back to IMC to close this off. Perfect. Thank you. But just before we ask investors to share their feedback, which I know is particularly important to the company, Adrian, can I please just ask you for some closing comments? Okay. So FUSION has been doing doing well. We've done a lot of work behind the scenes to make sure that we are positioned as best we can be. When, we find there's any spare opportunity, to improve what we do, we're working on it.

1:00:00 We are able to do that with support from the FMI grant in particular, so we we can cover a lot of those costs so there isn't any time or money being wasted. FUSION is a very tightly run ship, I believe. What we need is for the market to pick up a little bit. Some of those delays on decision making that our clients have had to be eased. Pressure on them is building and building and building so that it's going to happen, And we need to be in the best position to win that business. We are in a much better position to win that business now than we were twelve months ago. Thank you very much for your time.

1:00:45 Thank you, sir. Can I please ask investors not to close this session as you'll now be automatically redirected to provide your feedback? On behalf of the management team of FUSION ANTIBODIES PLC, we'd like to thank you for attending today's presentation, and good afternoon.