Nexteq (LSE:NXQ) — Interim Results

0:02 Good afternoon, and welcome to the NEXTEQ PLC Interim Results Investor Presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged, and they 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. Company may not be in a position to answer every question it receives during the meeting itself. However, the company can review all questions submitted today and publish responses, which is appropriate to do so. Before we begin, I would like to submit the following poll. And I would

0:34 now like to hand you over to interim chair, Nick Jarmini. Good afternoon to you. Good afternoon, everyone, and thank you for dialing in to the NEXTEQ first half twenty twenty four results presentation. The first six months have continued to be challenging for the group as many of our customers have suffered from lower demand, which has in turn impacted our performance. The PLC board has also seen changes with our chair, CEO, and CFO indicating their intention to step down from the board, which we announced the markets in July. Since then, I have assumed assumed the role of interim chair on the August 29, after an extensive selection process, we announced our new CEO, Duncan Faithful, who I'm delighted to introduce to you today.

1:24 Duncan has been with the group since January 2020, having previously been the gaming business leader and NEXTEQ chief commercial officer. In his time with the group, Duncan has steered the business through the COVID period, delivering innovative new products, expanding the business into new customer segments, and driving a relentless focus on excellent customer service. This makes Duncan the ideal candidate for NEXTEQ in the next phase of our growth. Despite the difficulties the group has experienced in recent months, the board continues to be very positive about the business, its capabilities, and potential for growth led by Duncan. So I'd now like to hand over to Duncan to take you through the rest of the slides.

2:13 Thank you, Nick. Good afternoon, everyone. It's a pleasure to be speaking to you about our wonderful company, NEXTEQ. So just to introduce myself, so I'm Duncan Faithful. I'm the new CEO of the NEXTEQ group. I've been in post for a couple of weeks, but as Nick mentioned, I've been with NEXTEQ as a group for about four and a half years having led the business through the challenging COVID time. But also since then, looking how at our product development and our sales processes actually can mean we make the most of our of our business. So I'm really excited to be here talking to you today. Prior to NEXTEQ, I worked in the financial support services sector looking at how technology could revolutionize the customer journey in terms of the payments market.

2:59 So I'm very familiar with how technology can be an enabler to business growth. So before I talk you through our business, I just wanted to paint a picture about how we see industrial technology markets and the equipment supplied into them. Firstly, all industrial equipment now has, to a greater or lesser extent, a computer computer at at its its heart. Heart. And how we interact with these devices is also changing. We are increasingly using touch screens and voice recognition to interact different differently with these pieces of equipment. And this has led to a metamorphosis in human machine interaction. And the fact that a computer is at the heart of almost all of these pieces of equipment places a much greater importance on the software environment, which, of course, is the instruction which makes the computer perform its operations.

3:50 There's There's an there's a growing reliance on these devices to replace labor in many of our markets, and we're seeing this across both of our trading businesses. Many many manufacturers of the industrial equipment have struggled to keep pace with the changes to the technology in their devices and in particularly to the explosion of computing and therefore therefore build up high levels of what we call technology debt. So there's a reliance on historical historical software within the business that makes creating new products and new systems difficult. And at some point, this debt has to be paid down. An example of this is when Windows 10 was introduced into the gaming market. Actually, the ability for our partners to take on this new functionality was compromised by by the the fact fact their their internal systems weren't really capable of picking up this new technology.

4:39 So that has led to a real misalignment of r and d spend in that many of our customers are spending way too much in our opinion of their time and r and d money focusing on legacy IT systems as opposed to focusing on what can make their businesses different and better. So how does that relate to us? So what does NEXTEQ do? Fundamentally, Fundamentally, at our heart, we are an innovator. We believe that we can create technology that enables our partners to take advantage of those things we spoke to on the previous slide. Our job is to enable our customers focus on what makes their jobs easier and better and enables their products to be differentiated in the markets in which they work.

5:24 So who are NEXTEQ? NEXTEQ is a technology company listed on AIM, and we've grown significantly since our listing in 2013 with revenues now reaching a 114,000,000 in 2023. And as I said earlier, innovation is at the heart of what we do, and you can see that with more than 20 patents and trademarks that we own. We're headquartered here in The UK, but we have a global footprint. Our 220 employees are spread truly across the world, making us close to the technology centers in Taiwan where our manufacturing base is, but also close to our customers across the world so we can support our customers to the best of our abilities. We sell our products into customers approaching nearly 50 countries. And these customers are across many sectors. The largest of which, as you can see on the bottom right of this slide, is in the gaming sector, but also we have strong representation in medical and in broadcast and many other market verticals.

6:22 You can see on the bottom left of this slide the number of the customers which we work with. Every Ainsworth and Merca are significant gaming manufacturers in The US and in Europe. And the other names that you see there are largely our broadcast customers which are becoming more and more significant as we roll out the strategy relating to the broadcast sector. So what makes an attractive characteristic of a focused market for NEXTEQ? First of all, compliance compliance is is critical. Critical. So these are often regulated or conservative markets, which have stringent regulations that we have to meet in order to give our customers a point of difference in their marketplace. Quality is really, really important to our customers and often overpriced.

7:07 So we look for we look for markets where quality is prioritized as a buying decision over actually the sales price itself. The environment in in which we work with is a very complex software environment, and we look for a multi tiered software stack, which we can integrate our own solutions into. And this complex technology environment leads to multiyear contracts, are very attractive to NEXTEQ, often between three and seven years because the designing in process is complex. And this gives rise to unique technology. So often, the work that we do with our customers create bespoke solutions, and this enables us to generate innovation and IP generation. And very importantly, we look for markets that are growing. So if you look recently at what we have done with broadcast and with our medical propositions, we are focusing on new product sectors that are gonna deliver growth and value to the shareholders and business itself.

8:02 So So moving on to our h one twenty twenty four performance. NEXTEQ has provided a resilient performance in what has been a challenging market environment. We are highly profitable and highly cash generative, delivering a double digit profit growth in h one twenty twenty four. However, as we said earlier, it's been a challenging time. Our order book has been impacted by destocking across our two businesses, reduced the order intake as we go through into h two twenty twenty four. However, we've been focusing on what we are good at, and our new product development processes are intact and are creating new products across both Quixson and Dentitron, and they are gaining traction. We have a we have a high customer retention level positioning us in a perfect place for when markets return to a normal position.

8:53 And as Johan will allude to in a second, we are financially very strong with record net cash positions to make us to put us in a position where we can take advantage when markets return to growth. So I will now pass on to Johan who will take you through some of the financial highlights of our h one performance. Thank you, Duncan, and good afternoon, everyone. As we turn to slide nine, which shows the financial KPIs for the first half of twenty twenty four compared to the prior year, and as Duncan noted, a resilient performance from the group in what was a challenging macroeconomic

9:25 environment. Some highlights on this slide. Gross margin of 37.3%, up 310 basis points on the prior year and staying at those elevated levels that we saw in the second half last year. And also excellent cash conversion at 225%, which drove our net cash balance to 36,900,000, which is a record level for the group. Slide 10 shows the income statement for h one compared to h one last year. Revenues $48,200,000 down 14% on the prior year as as the the customer destocking impacted demand across all of our sectors. Operating expenses of 13,600,000 in line with with the previous year as we applied strong cash management given the lower revenues.

10:12 Net finance income of $600,000 in the first half significantly up year over year as we've made the most of our excess cash balances and high interest rates and placed as much of our cash reserves on on deposit as possible. Taxation of 800,000 in the first half, which is an effective tax rate of 17%, in line with the prior year and also in line with with our expectations. And then finally, EPS of of just over 6¢ per share, down 16% in line with the with the lower profits. As we move to our our divisional performance, starting with QuickSend, which serves the the the gaming market. Revenues on the left, 30,900,000 in the first half of the year, down 10% year over year. Really a combination of some of our larger customers indicating lower demand due to the delays in customer and their own product releases.

11:05 And then also decline on monitor sales as we focused on our higher margin gaming platform gaming platform sales. And then on the on the the right, in terms of volumes of gaming platforms, 20,500 in the first half, down 21% year over year. We did see an increase in our average selling prices, which did offset somewhat the lower volumes that we saw in the first half.

11:29 Moving to Denstron, which supplies display components into a variety of industrial markets. Revenues of 17.3%, down 21% year over year. And and really the same trend of destocking to we saw across across many of of Dentitron's markets

11:46 leading to the lower lower revenues. What was pleasing to see in the first half, though, was a continued strong gross margin performance for Dentitron. This is something we first saw in in 2023, and so it's pleasing that that's continued into the first half of this year, meaning that despite the lower revenues, Dentitron could stay in line with our profitability year over year. On the right, just the the details around our our broadcast sector, which is a focus sector for the business. And as you can see there, really strong performance from broadcast over the last over the last year, double digit annual growth there. But we were not immune within broadcast against the the sort of broader economic conditions and destocking that we've seen from from customers, which drove revenues 38% lower year over year. We do have a strong pipeline of opportunities and we're making good progress in in some in product development. So we remain confident in the prospects for this sector going forward.

12:44 Moving on to to gross margins, 37.3% in the first half of this year. As you can see there from the chart, staying at those elevated levels that we saw in the second half of last year and and a step up from where we've been in previous years. The elevated gross margin, really threefold, is the focus on higher margin business in both our quicks and and our divisions. We've also benefited from lower component pricing as supply chains have now normalized after the disruption that we saw in 2021 and 2022. And then also just specifically for the first half, we've we've had some we've benefited from some positive customer and product mix driving our our gross margins higher. And these positives were were partially offset by a provision that we took against stock that we originally purchased for a reason. I'll come on to that in a bit more detail in a later slide.

13:36 Looking ahead to the second half of this year, we expect our margins to remain at these elevated levels that we've seen in the first half. Then moving on to Slide 14 and our profit before tax. In the first half of this year, $5,000,000 profit before tax, down 900,000 compared to the same period last year. The reason for the decline year over year really, it's down to the the lower revenues that we've that we've seen in the first half. That was offset by higher gross margin. And as you can see there, despite the the provision for $1,200,000 against the reason now, for for those of you that aren't familiar with Orozea, that's a a gaming customer that filed for bankruptcy in in 2023. We had contracts in place with Orozea to provide them with gaming platforms.

14:24 And as part of that contractual relationship, we had purchased raw materials to the to manufacture the the goods for them. Since then, since we weren't in a position to to sell those to a user, we have sought alternative sales opportunities. We've been able to sell some of the stock at at at positive margins, but we also had to to sell stock at lower than the cost price to minimize our overall balance sheet risk. And as a result, we took that provision of $1,200,000. Then just at the bottom, you can see the profit before tax margin, which has been a focus of ours. And so it's pleasing that despite the the lower revenues, we still have double digit profit margins of 10.4% in the first half of the year in line with last year.

15:07 And then just finally from me, our cash performance in the year, as we've said, record cash of 36,900,000 at the end of the half, up 9,000,000 from the start of the year, and that's really due to cash from operations of of 6,000,000. And then also a continued unwind of our working capital to fold the strong cash collections drove our trade data balances lower. And then we've also seen a continued reduction in our stock balances as we as we

15:37 no longer have strategic stock in place that we had in '21 and '22 and are now looking at more effective inventory balances. And then just the bottom, just adjusted operating cash conversion, as I said, two hundred and twenty five percent, so an excellent an excellent performance. As And you can see there over the last six year, the group has averaged a 130%. And we benefit from a capital light model, and I and I expect that we will continue to have high cash conversions going forward for the business. And with that, I'll hand back to Duncan. Johan. Okay. So what I would like to do now is take you through our two businesses and some highlights from the last six months. So in terms of Quixent, which is our gaming brand,

16:23 in the land based end markets, The US commercial casinos are still seeing good player numbers and gross gaming revenues continue to operate at record levels. So players are still playing in the casinos. However, there is evidence that the product life cycle of machine hardware on the casino floor is being extended, and the game software upgrades are being used to keep the machines fresh and interesting for the for the casino consumer. These effects are being seen because of the increased cost of capital at the moment. Nevertheless, we do expect over time for the capital investment cycle to resume as the old machines become degraded, unreliable, and unable to drive the latest game content, which which is is what what we we basically allow our customers to be able to focus on. Throughout a turbulent few years from COVID onwards, we worked very hard on delivering for our customers and supporting them through varying challenges and successfully done so, retaining a 100% of our customer base. We are are therefore therefore confident that as buying cycles resume, we'll see an uplift in demand from current levels just from our current customer base.

17:22 However, alongside that, we have continued to evolve our product offering to add Intel architecture platforms across across the the range, range, which opens up our products to certain groups of customers which have not used AMD technology previously. It also does derisk our supply chain having two core processor vendors available to our customer base.

17:42 Excitingly, we have seen positive sentiment on the opening of new markets and most importantly, in Brazil. Now Brazil has been talked about for a number of years in terms of a market which is potentially opening up. However, there is some really positive news in that. Whilst there are legislative hurdles still to overcome, we are now much closer to being regulated, legalized gaming in Brazil than ever before. And an opening of that market would drive hundreds of thousands of new machine placements, which we've already got customers secure to benefit from. So there is a real opportunity for Quixen in h two and onwards for us to grow as a result of our product development strategy and with some new markets that are opening. In terms of Dentitron, so the Dentitron business, which is a very broadly diversified customer base and sector base, it supplies components which are long term structurally growing revenue stream stream as equipment incorporates more displays and larger, more complex displays.

18:41 However, the whole of this sector has been significantly affected by the weakness in industrial demand. This confirms that the effects are industry wide rather than something specific to our markets and our offerings.

18:53 After four years of consecutive double digit growth in the broadcast business sector, the the business was unable to shake off this weaker weaker demand, and we saw a decline in revenues year on year in the first half. But despite this, this, there's there's been been good good underlying traction on products and customer pipeline with particular highlights being our first production orders for the products incorporating Tactile objects, which you can see in the top right of this slide. Our Our product, which was launched earlier this year, has also seen excellent interest, and we have sample orders secured now, which we are building against. And you can see that product at the bottom right of this slide. Our efforts to improve margins at the Dentistron business, which we've had the opportunity to do so during the difficult supply conditions in 2021 and '22, have continued to deliver record margin performance as Johan alluded to earlier.

19:45 And And interestingly, the resilient medical sector performance is a standout this year against many other sectors in the business seeing declining demand. So that's our two business that's our two businesses, and I'd now just like to hand back to Johan who's gonna take us through something we've done strategically around the cash we have on our balance sheet. Thank you, Duncan. And just to give everyone an update on on the share buyback program, the board obtained approval for for a a share share buyback program from our shareholders at the AGM in April of this year. Initially, this was a limited program of up to £1,000,000, principally with the intention of providing short term liquidity for the group's in group shares. Following engagement with shareholders and considering the likely timing of near term acquisition opportunities, the board extended this buyback program in July 2024 and now intends to utilize up to its full authority to purchase up to 10% of the group's share capital, which would return up to £6,500,000 to shareholders.

20:46 Now the board remains committed to allocating capital towards diversification of the group's revenues into new market sectors consistent with its growth strategy, and the group's capital allocation policy remains unchanged. Okay. Thank you, Johan. So moving on to the outlook for the business for the remainder of 2024. So order intake has remained muted through 2024, leading to the announcement in July, tempering expectations for full year trading. Despite the lower order intake, the group has order coverage of more than 90% of the 2024 forecast revenues, and and we we expect to deliver full year profit before tax and revenues in line with the revised expectations as set out in the July 2024 trading update. We expect to continue benefiting from our strategy to focus on higher margin products with gross margins in line with h one performance.

21:38 The customer destocking cycle leading to a normalization of order patterns is still ongoing, and we expect this to recover into q one twenty twenty five. However, it continues to be difficult to determine the extent and timing of the recovery. We have continued to execute on our growth strategy and believe that the group is well placed to return to growth in 2026 as the new business wins start to ramp and end markets recover. So notwithstanding short term challenging macro trading conditions, the structural drivers of demand for the group's products and its business model to support customers in selected industrial markets to outsource aspects of their technology to NEXTEQ remains intact. Continue to generate healthy operating cash, which is building on a strong balance sheet, and this positions us well for the future organic and acquisitive growth.

22:26 And so finally, so why I'm excited about us as an investment case? First of all, we have significant growth opportunities in the markets that we focus on, and we have an experienced team ready to deliver that with multifunctional specialists across engineering, supply chain, marketing, and sales. We're a global business already well established close to our end markets and our end customers. And these elements alongside the strong financial position we're in gives me confidence that we can grow the business as we move forward through into 2025.

22:58 So that concludes the formal presentation, and I'd like to open this up now to any questions that you have. Thank you. That's great. Thank you very much indeed for your presentation. I will now bring your cameras back up. Ladies and gentlemen, please do 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 your investor dashboard. I'm Nick, Duncan, Johan. As you can see, we have received a number of questions throughout today's presentation. And Johan, if I may now hand back to you to chair the Q and A and kindly ask you to read out the questions where appropriate to do so, and I'll pick up from you at the end. Yes. Thank you. And then thanks, everyone, for the questions you've submitted.

23:47 The first one here, perhaps, Nick, if I can pass that to you. We've had a couple of questions just requesting an update on the on the board changes and and how that's how that's progressing. Would you would you be able to give us an update? Yes. So I think you're aware that, you know, obviously, we have had some changes at the board level in the directors. Duncan has has stepped in as the new CEO, and the board is very confident that he will be in a in a strong position to take the business forward and and really maximize the potential of of of the company. We're also well into a recruitment process for a new CFO, so we hope to be able to make an announcement around that, in in in due course.

24:39 In the meantime, Johan continues, as a CFO. And, the chair, we are in a again, also in a recruitment process to find a permanent chair. But in the meantime, I I'm the interim chair and enjoying working together with my colleagues in that in that role. Great. Thank you, Nick. And then we've had a we've had a couple of questions here around acquisition strategy, which is I'll ask Duncan to to answer. I'm just gonna read both of them out. The first one says, can you provide more insight into NEXTEQ's acquisition strategy? Given the board's focus on diversifying revenue streams, what criteria are being considered for potential acquisition targets? And then linked to that is, can you please give an update on any pipeline acquisition opportunities for the group? Duncan? Yeah. Johan, thank you very much. So in terms of our acquisition strategy, I've been in this role for a couple of weeks, as said earlier on. And my plan over the next three months is to get around the business and understand fully the opportunities in all the market verticals, particularly in the Densitron business.

25:48 I think we have significant organic growth opportunities across our business. But within the Densitron organization, we sell our products to multiple different verticals. So I think there is an opportunity to really investigate these different market verticals to understand where we can apply the engineering excellence that we have across our group to to create new IP based solutions that we can sell into the marketplace. So in terms of acquisitions, I think the work we will be doing is understanding what markets we really want to target. And rather than just making acquisitions for acquisition's sake, we do it for the purpose of really extending our reach into our target market areas. So I'll be able to give further updates on this after I've spent the next few months really truly understanding the Densitron business.

26:37 However, it's really important just to reiterate, our balance sheet is really, really strong. So we do have the potential of pulling the acquisition lever when we find the appropriate target, but it will be exactly that. When we find exactly the place we want to focus on, we will then make acquisitions in that place. Thanks, Duncan. A couple of questions here around share buyback, which I'll pick up. The first one says, given the approval for a share buyback of up to 10% of share capital, how does the Board balance the repurchase program with the need to allocate capital for potential acquisitions and diversification into new markets? And then secondly, there was a question, given the depressed share price, would you consider using the announced buyback program in an accelerated way? If I can answer the first one, I'm gonna just say we've got a very strong balance sheet. We've got almost $37,000,000 of cash at the end of June.

27:31 That really has allowed us to do the share buyback. But as I said in the in the in the in the earlier slide, really continue on with the with the group's priorities. Our our capital allocation policy has remained unchanged despite the share buyback. We want to, you know, we wanna use that that cash and the balance that we have to diversify the group's revenue streams. And the fact that we have $37,000,000 of cash means that we can continue paying a progressive dividend and also return some cash to shareholders via share buyback and continue with the other capital allocation priorities that we have. In terms of the pace of the share buyback program, at this stage, there's no plans to accelerate that, but it is the share buyback program is something that the board is evaluating as it continues.

28:20 Then, Duncan, probably one for you. In Quixant, are the longer capital renewal cycles expected to be temporary, or is there a risk the longer replacement cycle could be the new norm? Yeah. Thank you, Johan. Yes. We do believe they will be temporary. The the question is how long the current situation will carry on, I guess. I think we're expecting that through 2024, the sort of the depressed activity will will carry on. There is a big event in the quicksand calendar, takes place in Las Vegas in about three weeks time, which is the G2E Gaming Trade Show, which is where all of the game manufacturers will show off their new product developments. And we are expecting that to be a real barometer for the gaming industry and how strong the recovery is likely to be going into next year. So to answer the question, we do expect it to be temporary. It's very difficult to isolate exactly when that's likely to end.

29:18 So we're expecting that, as usual with G2E, there'll be increased excitement in products that are launched going through to the Christmas period. And then in Q1, plans from the casinos to place orders will take place. So we're expecting the the situation to shift as we move from q one into q two. It's very difficult to be exact about that right now. Thank you, Duncan. A couple of questions here just around forecast. So the first one, what is driving confidence of the expectation of destocking to end in Q1 twenty twenty five? And then secondly, how strong is FY 2025 revenue order coverage? Yes. No no problem. So so as per my my previous answer, I think 2025 is difficult to predict in terms of when the the destocking program is likely to end.

30:07 I think that that there is positive sentiment coming out of a lot of the game manufacturers in terms of their game content and how they are gonna be putting new material out into the market. So I think we have to follow that, and I think we have to be confident that the game manufacturers' desire to put new cabinets and new games out into the market will will gain some impetus after the g two e the g two e event takes place in Vegas. And in terms of order coverage into 2025, it's it's it sort of follows on from my previous answer, and it's quite difficult to be exact. There were a number of things that have changed recently. The lead times for a lot of the products that we place into the market has reduced over time, so that need to place orders a long time in advance that we saw over the last few years has changed recently.

30:55 But again, I think G2E will give us a really good idea about the development of the market and how that's recovering. And then in January 2025, there's the European version of the G2E show that's held in Barcelona this year. And again, I think we'll get much more of an idea about how the market is responding post those two events. Thank you. A question here on product development in our in our cabinet solution. So does product development include further investment in the group turnkey cabinet offering? And what are the prospects for the for the full cabinet? Yep. No. Thank you. So the cabinet will remain a part of our proposition and an exciting part of it, actually, because, what the cabinet and the turnkey solution enables us to do is speak to different audiences in the gaming world.

31:44 And, primarily, there are two where this applies. First of all, the traditional game manufacturers who are looking to outsource the development of all of the hardware relating to the content that they are trying to get out in terms of the games that they're making. So we give a excellent high quality, alternatives to their traditional mode of procuring these cabinets. The second thing that's really important for us as we move into 2025 is there's an ongoing trend where online game companies are trying to get their game content into a land based environment. And that's counterintuitive. A lot of industries are going the other way. However, game content providers online have reached a point where their audience isn't growing as much as they were, so they're looking for a new audience in that land based environment.

32:33 But in many cases, the online game companies really don't know enough about how the hardware proposition works, how a PC will need to be integrated into a cabinet, and that's where we can come in and offer true innovation and true expertise in how gaming hardware functions. So I think the turnkey cabinet offering will include traditional cabinet sales and similar to the ones that we've announced recently, but also the ability for us to create that turnkey solution opens up Quix into a a whole new marketplace that we otherwise wouldn't have had access to. So, yes, product development and investment in the turnkey solutions will continue, and we look forward to telling you more about that in future sessions. Good. And then it looks like the last last question here. Thanks for all the questions, and Peter, there's more.

33:22 Do do publish them. But one for you, Duncan. How does the growth of generative AI influence the company's direction? Okay. Yeah. That's a really good and really topical question. So in all of our product development that we are making across our two portfolios of products, and we touched on those earlier in the presentation, we're thinking about how AI can help our customers, particularly in the way that their game development processes work. So ongoing conversations with our major gaming customers particularly, is how we can create solutions that enable them to create games in a different way. Because the success of the gaming organization is all to do with how well we can make our customers deliver new, exciting, illuminating content and how we bring that to market in a quick quick way so we can make the best of that investment. So I think AI will continue to play a role and will increase in its activity that we work with our customers on. Thank you. And it looks like that was the last of the questions. Thanks again for all the questions submitted.

34:27 Operator, I'll hand that back to you then. That's great. Thank you very much indeed. And of course, the company can review all questions submitted today, and we will publish those responses on the Investor Me company platform. But before we direct the investors to provide you with their feedback, which I know is particularly important to the company, Duncan, could I please ask you for a few closing comments? Yes. Certainly. Thank you very much. So as you will have heard in the presentation, know, h one was a difficult period in terms of revenue, but every other aspect of our business is in really good health. And most importantly, the product development processes that we've put in place across Quixon and Densatron are yielding really exciting new products that we're looking forward to sell into our marketplaces. And initial feedback on our products are really exciting, and I think we will see continued development across our revenue streams as we go into 2025 as markets come back to life and our new products really start hitting their stride. So a really exciting period ahead, and I look forward to updating you on that at the next session. But thank you very much for dialing in.

35:28 Fantastic. Duncan, Johan, Nick, 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 in order that the board 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 management team of NEXTEQ PLC, we'd like to thank you for attending today's presentation, and good afternoon to you all. Thank you. Okay.