Nexteq (LSE:NXQ) — Interim results for the six months ended 30 June 2026

0:00 Good morning, and welcome to the NEXTEQ PLC H1 twenty twenty six 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. Before we begin, I would like to submit the following poll, and I would now like to hand you over to CEO Duncan Faithful. Good morning.

0:27 Hi there. Thanks very much for the introduction, and welcome to NEXTEQ's h one twenty twenty six results. Through this presentation, we're going to be talking around a performance snapshot for h one, but also just to talk through the progress we made through h one, but also the headwinds that we faced that explain some of the numbers that we'll come on to through the presentation. We will be focusing on some of the strategic successes we've made through this period and also what we're planning on doing through the second half of twenty twenty six to ensure we position ourselves for the best growth through 2728 and '29. So I will start and go through the background of the business, and then we'll hand over to to Matt, who you can see on the slide here, who'll talk through the numbers a little bit later on.

1:18 So as a reminder, who who is NEXTEQ? So, we're basically a technology enabler. So we allow our customers to really focus on what they do for a living, and we operate across a huge number of verticals, which you can see some of them in the left hand diagram there. And we trade in land based gaming through to medical, through to defense, through to transport, and numerous others. So we are a true multi vertical business focused on technology outsourcing. And NEXTEQ as a group sits in that perfect intersection of what we are expert in, whether that's embedded computing or displays in HMI solutions or the software and the integration that goes behind all of those. So So NEXTEQ has a tremendous opportunity, and you can see, our enviable list there of customers that we trade with, and that's just a a small selection of those.

2:14 But the fact that NEXTEQ has all of these different areas of expertise means that we have sort of unlimited opportunity on our doorstep really with people we currently trade with. So over recent years, Matt and I have been focusing on looking at the one NEXTEQ principle that we've talked about before, where we combine all of our skills to deploy solutions across all of those customers, whether that's displays or computing, and that will carry on being a focus of the business as we move forward. So h 01/2026, I think it's fair to say it's been a challenging period, and that's primarily because our largest historical, market vertical that we trade in, the land based gaming market, has had some real issues that it's been dealing with through the course of this period and, in fact, through 2025 before it.

3:07 I'll talk more about those headwinds shortly. But really, what we've been focusing on in h one as a group has been what we can control. And so we have been continuing to provide superb customer service to the customers that we have. In Densitron, our displays business, making real progress on the strategic agenda of becoming more than a display, And, again, we'll talk about that a little bit later. And from a strategic delivery perspective, as we outlined in our three year plan at the beginning of twenty twenty five, really focusing on how we create new products and solutions that will deliver new growth and new sustainable growth as we go through the next three years. So, you know, the summary of a difficult trading environment for our heritage business, but really focusing on what can drive a different outcome as we move forward through the next few years.

4:03 But what was that that we were looking to do in h one twenty twenty six? So largely, as a reminder, and I know I've spoken to you all about this before, but that diversification agenda is critical to us. And it's critical because for too long, the group has relied on land based gaming for the majority of its revenue, particularly in North America. And within land based gaming, we've relied on two very large customers for a long period of time. And as many of you will know, that changed quite dramatically in 2025 when our largest customer was acquired by someone who didn't use NEXTEQ, and that's had a fairly significant impact on the business.

4:45 So how have we been driving that diversification agenda? Looking, at a product called Launchpad and how we monetize our clear and obvious software capability in gaming, looking at how we become more than a display and using our HMI expertise in order to do so. And both of those are part of a reinvigorated and reenergized product road map that we've developed that really enables us to target new markets with new products, and I'll talk about that again a little bit later on. And finally, in the top row there, you can see the target operating model. Matt and I have been really focused on managing our costs and, through h one twenty twenty six that carried on.

5:32 But at a at a wider level, we're looking at how we really are going to deploy our solutions into our markets in a new way. And again, I will I'll touch on that again a little bit later. But just getting into some of those headwinds that we talked about. Now you can see on the bottom row of this of this chart in the orange color, from left to right, tariffs has had a huge impact on us. Traditionally, two thirds of our gaming business has been in North America. And whilst our computers that we provide to that market do not attract tariffs, The rest of the bill of material for our gaming customers for their cabinets, they do. And, the cost of those cabinets have therefore gone up considerably.

6:17 And as a result of that, casinos and other gaming venues, across the world, but mainly in North America, have been buying less cabinets. And that's really flowed through, to our numbers because less cabinets sold, less computers are required. So, tariffs had a real impact, on our trading volume. That coupled with what's been going on with the graphics chip providers, but also the memory providers has meant that the the cost of our products to our customers have also gone up. And memory continues to be something that we have to watch as we go through 2026 and beyond because the issue with memory has been driven by the AI companies and their development, and that doesn't look like that's slowing down.

7:05 So more and more of our focus around how we manage our computer products going forward will be with memory in mind. As a result of those two issues, North American gaming sector is very uncertain in terms of how it's investing. And, we're seeing that across both the large casinos you'd expect to see in Nevada, but across all of the other route markets that we see in North America. So sort of uncertainty at the current economic situation plus what's going on, with sort of geopolitical uncertainty in the world is just making people hold off on big capital investments. And the final box on the bottom row of this chart really talks about that specific issue around IGT and Everi. So, the trading position of Everi has has, deteriorated quickly as IGT has integrated them into their business.

7:59 And the slowdown of our business, therefore, with every has been quicker than anticipated. There is some news that has come out around IGT that I will talk about towards the end of the presentation. But the headwinds really facing the gaming part of our business with Densitron, as I said earlier, trading to expectation levels. So in terms of what have we delivered in h one, you can see you can see the the objectives along the top of this chart, but in the in the green boxes. So from the point of view of revenue diversification, as you will have seen in some of the market announcements, we've been winning significant pieces of new business with IDS control solutions, which is part of our Densatron business, as well as other significant advanced display wins.

8:51 Now a lot of you who followed our business for a long time will know that the, the sales cycle and the integration cycle is reasonably long. So the embodiment of the strategy about winning these customers is one thing, but there is then a life cycle then of integration that can typically take about eighteen months. So we're making great progress on winning new diversified revenue, and we're in that process of integrating that.

9:17 Launchpad is a real focus for our business, and I'm delighted to be able to say that we have three Launchpad customers who are in the integration cycle now and more lining up, to be next in line. So Launchpad really is striking a chord in the gaming sector. And the great thing about the Launchpad opportunity is not only does it give us new recurring software revenue, but it also means that we win new hardware customers, which is the traditional revenue stream for the Crixon business. Tactila has been a massive focus for us in the HMI solution, agenda, and we're really proud to be able to say we've won some new Tactila backed wins that, again, are going through that integration cycle now. So, again, the strategy around how we diversify revenue is really starting to make progress.

10:11 But at the same time that's been going on, we're having to watch those memory markets very carefully and our cost management. And again, through h one of this year, we've removed just over a million dollars worth of annualized cost, at the same time as investing in those critical supply components, particularly memory, that allow us to, a, buy at a sensible price, but also means that we can satisfy our customer demand as we go through h two and into 2027. Brazil has been a big topic of conversation for us over the last couple of years, and there's been significant movement on that through h one, so much so that we believe that 2027 really will be finally the launch for the world of gaming, particularly in the lottery space in Brazil. And part of our product road map has been developing a specific product for Brazil that allows our partners to work in regulated and unregulated markets in Brazil, but with the same computer. So true innovation, which, of course, is at the heart of what NEXTEQ really delivers to its customers.

11:24 But in summary, what are we really trying to be? We're about going up the value chain of technology solutions. So historically, we would have thought of ourselves as a component supplier, be that displays or computers depending on which market vertical we were looking at. Over the last year, we've really targeted moving up that value chain to fully integrated advanced solutions, be that software and hardware in gaming or in the display verticals we trade in, a full system solution incorporating our computer skills, our display skills, and our HMI skills. And so that part of our strategy, we are really pushing and making really great headway on. But it has been a tough time in h one. And to talk through some of the numbers, I'll just pass over to Matt now who'll describe where we are.

12:15 Thank you, Duncan. So looking at the income statement performance for H1, we've delivered revenue of $26,700,000 which was a 34% decrease on the prior year. The main impact behind this was the demand from U. S. Gaming customers, which faced significant challenge from the headwinds, which Duncan talked about previously. In terms of gross margin performance, the gross margin was 30.3% across the group, which was down two eighty basis points on the previous year. Big factor behind that number is the DDR4 pricing challenges and other component cost increases that we've seen through the first half. Really positive point on the the gross margin is Densitron, which last year hit a record gross margin of 38%.

13:04 And pleasingly, it's maintained that 38% gross margin performance in in h one. In terms of, adjusted operating expenses, we're down marginally on h one of last year. That's a result of savings that have been implemented, partially offset by inflationary impact of cost increases elsewhere. We've just initiated a program over the last two months to implement further savings in H2 this year and roll into kind of further savings going into 2027. So overall, our p and l performance was adjusted loss before tax of $4,000,000 in the first half, and that reflects the lower revenue and gross margin performance that we've come that has resulted from those headwinds.

13:53 And we're certainly expecting the H2 performance to be much stronger than that with increased revenues and margins driving better performance in H2, which more ties in with the traditional second half weighting that we see in the NEXTEQ business.

14:12 So looking at QuickSent in more detail. QuickSent business delivered $12,700,000 of revenue in the first half, which is 53% down year on year. Huge impact of that was the demand for our gaming platforms. So our PCs sold just under 9,700 platforms in H1, which is 56% down year on year. You can see that from the chart on the right hand side, also, a significant reduction in high end and mid range units sold, which is typically the units that we sell to The US gaming customers. And that, therefore, is also driving down the average selling price of our gaming platforms in the first half. In terms of Densitron, much better picture for for Densitron.

15:01 So slight increase, 1% higher than we delivered in h one twenty twenty five. So $13,900,000 of revenue for Densitron. We had new wins coming through having making a very positive impact, but some of those wins were partially offset by delays with existing customers offsetting that ramping of of new customers. Really pleasingly as well on the Dentistran side was our our sales pipeline performance in the first half. So we converted $12,700,000 of sales pipeline opportunities, which represents the the lifetime value of those opportunities over five years. From from that conversion, we're expecting to have $1,900,000 of revenue in year end twenty twenty six from that that new pipeline.

15:53 And and also a new million dollar customer is is expected to come from from those wins, albeit not in 2026,

16:01 given the the time for that customer to ramp as as Duncan was talking about earlier, the typically eighteen month integration cycle. And in terms of h two sales pipeline outlook, we've already converted more pipeline opportunities in in h two than we did for the whole of h one. So certainly expecting second half to be really strong in in sales pipeline performance for Dentistron.

16:29 So looking at in detail at cash flow. So we closed h one twenty twenty six with $10,700,000 of cash. That was down from $25,300,000 at the end of December twenty twenty five. There's a few key areas which drive that reduction in cash balance. So we returned $8,500,000 to shareholders through dividend and share buyback in h one. There's also the trading performance in h one, driving down the cash flow from operations, which in in previous halves has been positive, but obviously negative in h one twenty twenty six. We made a strategic investment in stock to secure TDR four components to help mitigate, the price increasing challenges that we've seen in the market, but also availability to ensure that we have product on hands to be able to support custom customer demand.

17:29 And in the middle there, you'll see two fairly big blobs of in in the bridge, which reflects the the purchase of the the Taiwan office in H One. So we we purchased new new office in Taiwan, which included mortgage financing. So a net cash outlay of $1,500,000 to secure that property.

17:52 We actually had an offer, from a third party to sell that in August, and we've reached an agreement with them to conclude on that transaction, which we expect to close out, in October. So in the second half of this year, we'll see positive cash inflow coming back in and relating to that same Taiwan office. And those are really the key movements that's driven our our cash flow and adjusted operating cash conversion of 50% in the first half. So moving on to the balance sheet. There's a few key movements to pick out here from where we were at year end. So property, plant and equipment, the increase there reflects the acquisition of the Taiwan property.

18:42 The inventories balance in current assets really reflects the investment in strategic stock as well as the build of stock balance towards the end of h one to support a stronger revenue number in h two. The cash we talked about on the previous slide. And then in terms of liabilities, loans and borrowings has obviously increased by around $1,212,000,000 for the the new mortgage on the the Taiwan office. But as I said, we'd we'd expect both the mortgage and the the PPE changes to reverse out by the end of the year through the the sale of that property. So in terms of outlook and priorities for H2, I just can kick off there with talking through our signpost success, which we outlined back at the start of twenty twenty five. And we had three key signposts, which we're very much monitoring and actively planning against to support driving growth in the business.

19:44 So the first of those is around pipeline growth, targeting to grow our sales opportunity pipeline to $630,000,000. That's grown to 505,000,000 at the end of h one, which is a 5% increase on the pipeline since December 2025. That factors in as well us closing $27,300,000 of wins from the pipeline through h one across both the Quixen and Dentistrong brands. The second of the signpost of success was around driving new IP revenue growth. We've seen in the first half of this year pre mass mass production revenue for Tactila and having won an additional customer for Tactila and going into full mass production in the second half, we'll see that numbers of Tactila revenue increasing for Densatron.

20:44 And also on the Dentitron side is we're driving the strategy behind more than just a display. We've seen new product wins incorporating our IP, particularly around button technology, driving IP revenue flows in the first half. And we'll also see our first Launchpad revenue coming through in h two as we close out the integration of those first customers, first three customer wins, which Duncan talked about earlier. The the final signpost was around million dollar customers. So we had a target to increase the number of million dollar customers to 20 by the end of twenty twenty seven. In 2026, we're trending towards having ten $1,000,000 customers, which is down from 14 that we had in 2025.

21:34 The biggest driver here, which changing that number of million dollar customers year on year is the demand from The US gaming customers and also gaming cabinet sales, both of which were reduced year on year. But we've seen from the pipeline conversion that we had in the first half, there's $3,000,000 customers that we expect from those customer wins, albeit those will ramp into to future years. So we're not seeing those as million dollar customers in 2026. So I'll hand back to Duncan who took through the h two priorities. Thank you, Matt. And just to finish on that point about $1,000,000 customers, of course, as I said earlier, this is the reduction in revenue in North America is not through lost customers.

22:26 So we are expecting some customers over the next few years to come back to being in that 1,000,000 category. Obviously, it's hard to predict some of those headwinds in gaming in North America. But you will have seen this chart last time we spoke. So this is really talking about sort of the actions we're taking to diversify our revenue and and build a different business to to the one of a few years ago. And starting on the left hand side, which is the orange for quick center, just going through some of these the elements of this plan. We have to the bottom point there about DDR and SSD is really, really important because we have to continue to manage those markets in the face of the competition we have against, the AI companies for those components that are critical to gaming computers.

23:15 So that's gonna be an ongoing story for us. Launchpad, you've already heard that we're making great progress. We've got three on the books already. And Launchpad, again, will be presented to the customer base in North America for the first time actually at g two e in October. So really, really pleased with with Launchpad's development. And and, again, it's important to remember that's recurring software revenue. So it's the first time we've ever monetized, our expertise in gaming software. Really pleased to announce that we are launching our monitor range at g two e, which is, again, sorry, October, so, within the time frame, or thereabouts that we we said we would as at the start of the year. And this really is a chance to take advantage of the relationships we have through our computers to to grow organically with those by offering more products for their cabinets. And we have some excellent products. They're really high quality solutions.

24:15 Now IGT, just to touch on that for a second. So IGT, again, last time we spoke, we're talking around the RFP they were going to issue for the main platform, the main computer for the IGT every combined estate. We literally received that at the beginning of this week, and we are responding to it now. The plan is we have to respond to that by the September 16, and it's a significant piece of business. But it is different to our normal business model in that IGT really are looking for a manufacturing partner as opposed to a design partner. And, you know, we see ourselves as absolutely in the innovation and design space. So we will see where that RFP goes, but really pleased to say we've been included in that tender, and many of our competitors haven't. So it's it's a it's a good step one to getting back to talking to IGT.

25:14 New cabinet solution, we are launching that, through the through h two this year, and already have a really good pipeline developing for new cabinets. And we've already talked about some of the cabinet business that we've won before. The top two in on the left hand side of this chart are really important. So integrating Snapdragon as part of our gaming solution base is really important as AMD and Intel, are our traditional graphics chip solutions providers, as they move into a much more AI focused space, it's very important that we create solutions that are market appropriate and price appropriate for some of the markets that we sell into. So Snapdragon, through Qualcomm gives us a real opportunity to diversify those traditional revenue streams, and open up new opportunities in gaming.

26:07 And and at the top there, you can see a new computer for tier three companies. Now so that includes Brazil. That includes some of the route markets in North America and in Spain, and it really is a true piece of innovation that will enable our customers to build a modular solution for where they're operating in different regulatory environments. So, again, those real core strengths of QuickSense about real in-depth knowledge of the market and the regulations and bringing out unique solutions that cater for those. So focusing very much on delivery and execution of what we've talked about, and we've made really good progress across all of those, the elements of that plan. On the right hand side, you can see some of that innovation agenda around Densitron and being more than a display.

26:56 So, again, we've talked a little bit about some of the successes we've seen early on in the provision and execution of this strategy. But we're making real progress, and, actually, this is something we are gonna really double down on as we look at all of the different verticals that we can apply this outsourcing to as we supply everything from the computer through to the housing, of of a display. And as we speak, again, at the end of this year, we'll be able to tell you more about some of the exciting wins we've made. But to put it into some sort of context in reality because that sort of really helps. On this slide, you can see some of the solutions we've created and have won business with. Top left, that's a broadcast solution, that's really unique, in how that works and operates for one of our customers.

27:48 Bottom left, that's a smart home control solution, that has been launched very recently actually, and we've secured a multi year PO for for that solution. And on the right hand side, you can see, the full system solutions for, at the top, a testing mechanism in medical and at the bottom, a specific solution for the defense market. So the strategy around becoming more than the display is multivertical, applicable, and that's what's really key for us as we look about how we diversify our business going forward. So h two, what are we expecting to happen as we go through towards the year end? As Matt's already talked about, we as traditional with NEXTEQ, h two will be a stronger year in terms of revenue, And we've already got really good order book coverage across the group, so we're confident in the number that we talked around in July and in May about what we we thought 2026 would look like.

28:53 New client wins, really, really important, and the sales team are hungry looking to convert that pipeline that Matt has talked about. But we're a product and solutions business, so we're really focusing on how we take those really good ideas but executing them really well, particularly around IDS, the control system for broadcast, for Launchpad, we've talked about in gaming, and then Tactila, as a HMI solution. And Brazil will be something that we have to watch as we go through the early part of twenty twenty seven because these opportunities are significant and currently unforecast in terms of our longer term numbers. Really, really focused on cost management as you'd expect. And as Matt's already talked about, we'll be looking through h two about how we continue that process of making sure our overheads are in line with our business.

29:44 So, really, the the the next half of 2026 and through 2027 is really focused on the flawless execution of the plans we've already talked to you about. And whether that's advanced displays, and when I'm talking about flawless execution, that's everything from how we market to our target verticals through to how we actually make and distribute, these really advanced display solutions. And as a part of that, HMI and especially Tactila, really, really important. But in our computer business, as you know, we've been focused on land based gaming, since Quicksand was founded in twenty, twenty one years ago. Sorry. But really now it's time that we take those skills that we have utilizing sort of Edge AI technology into new verticals.

30:33 And as we tell the story, as we go through '27, '28, and '29, you'll see a real focus on how we take those core skills into new markets. But not forgetting where we've come from. The gaming market, whilst it is under some pressure at the moment, through those headwinds that we've discussed, there's real opportunities if we have the right products and solutions. So that new product I've talked about for the tier three market plus Launchpad as a combination is really powerful. And our sales team is absolutely focused on ensuring new customer wins. And at the same time, as markets normalize, customer service to the current customers will always be critical and important to us. The final bullet point on this slide is a really important piece of work that Matt and I are starting, which is looking at how we actually create and make the solutions that we we provide to our markets.

31:28 Currently, everything is very much focused on what we do internally. We'll be looking at how we partner with different people to create a more effective and more efficient operating model so we can maximize speed to market and the profitability of the new wins that we've we're seeing. So that's a summary. That's a a very quick fly through h one. I I I appreciate that for NEXTEQ. As ever, we look forward to your questions. So so look forward to seeing those, and I'll I'll hand back now to the individual. So thank you very much. That's great, Duncan, Matt. Thank you very much indeed for your presentation. Ladies and gentlemen, please do continue to submit your questions using the Q and A tab situated on the top right corner of your screen. While the company take a few moments to view those questions submitted today, I would like to remind you that recording of this presentation along with a copy of the slides and the published Q and A can be accessed via investor dashboard.

32:23 Duncan, at this point, if I may now hand back to you and kindly ask you to read out the questions where appropriate to do so, and I'll pick up from you at the end. Thank you. Brilliant. Thank you, Alex. Thanks for the introduction. And we have a number of questions that we're gonna try and group together. So it may not I may not put it in the language that's exactly answering each individual question, but I think we'll answer all of the topics as we go. And it it looks like so I've got a couple of things to cover, and then I'll hand to Matt who will talk about some of the the more finance focused stuff. So so first question is really is around gaming and what's happening in land based land based gaming and why it's not sort of as as successful as it as it used to be. There's a there's a number of reasons for that.

33:08 First of all, we've we've seen the full loss really of the every position, so that's reduced significantly. But the but the question that was asked was around why aren't we winning in gaming anymore? And actually, we are. In the first half of twenty twenty six, we've won four new customers with the new icon products that has recently been launched. And, of course, we've won three Launchpad customers that are also software and hardware customers. So I think we're winning. We're just winning in a different way. And the issue around gaming is really that the large traditional customers we've had in that space just have got significantly lower volumes. And what's driving that? It is the combination of the impact of tariffs on the full billing material that goes into that gaming cabinet.

34:01 And the casino venues have got a finite budget to buy new cabinets with. And and at a general level, each gaming cabinet is approximately sort of 25% more expensive than it was prior to the tariff issue. So it's a volume issue from our largest gaming customers that's really driving the reduction in in the expectation around quicksense. The tariffs plus components. So there's been a there's been a there's been a question around component pricing and whether that's really impacting things, and it really is. So memory as a component of computers really has accelerated in its cost, largely driven by the requirements of the AI companies for the same memory that we use. So that combined with tariffs is really impacting the sort of the volume requirement from from our customers.

34:55 But the key thing really is what we do about that. So that's why Icon the new Icon product is important because we're utilizing a different memory solution in that product And also Launchpad because it's a software based solution that that isn't focused on utilizing components. What I would like to say just about the component cost here is that we have been passing those costs through to our customers, but maybe not applying the full margin that we would across the rest of our our computer billing materials. So we're we're handling the component cost increases, but in a way that isn't passing the full burden on, but not impacting us at dollar margin perspective. Second thing really was around confidence in year end. And as we said through presentation, we're awaiting two orders to finish off this year.

35:47 One of them is from one of our traditional gaming customers, and the important part of that is we've already invested in the componentry to fulfill that order when it comes, and we're expecting that to be at the g two e com conference, which is at the end of September. So we hope to be able to come back with news on that around that time. The second one is is specific to memory, and part of our strategy this year is to be make sure that we've covered ourselves with memory availability because that's the second part of the memory challenges. It's not just the price. It's making sure you can get the stock itself. So we're doing some commercial arrangements with some of our customers about how do we forward by memory, and that's the second part of the orders we're expecting.

36:33 And that, again, should be over the next three weeks. So I would expect that by the beginning of October, we'll we'll know exactly where we are with that. But we're really confident that they will come, which is why we've said that we reiterate the position we we made a couple of months ago in terms of confidence in year end, and we've kept that position the same. So I hope that's answered those two questions, and I'll pass to Matt now who will answer that. Why going But the focus to of those strategies was certainly to do increase customer lifetime value that we got from customers in those spaces. So picking up on IP led design, which is very much the focus on the Dentistran side of the business. What we're seeing is this giving us much better integration into our customers' product portfolio where we're becoming an extension of their their customers' engineering team. So this gives us a a greater share of manufacturing work done for the customers. So taking work that was done by other third party design and manufacturing businesses.

37:44 And therefore, we're increasing the dollar value of revenue and also dollar value of margin that we're getting for these full IP led system integrations, and therefore, average selling price of the product to those customers is increasing very nicely. On on the Launchpad side, our focus here has been by adding the software in with the PC sale. As a minimum, we were looking to double the the gross margin we that we got from that sale. So the PC would still sit at its traditional margin as selling an icon three PC, for example. And then the software the Launchpad software element would would effectively double the gross margin that we we get from that sale. And we see the Launchpad software as having 80% gross margin on that recurring software element. So each year, we we pick up a a software license fee for for that software and that license revenue scales and grows over time as the Launchpad number of Launchpad customers grows and the number of PCs deployed in the market operating on Launchpad software increases over time as well. I think a key element around the economics behind Launchpad as well is the fact that the three customers we've sold this to in 2026 have all been brand new customers that we haven't traded with before. So it's really a route for us to bring in a new customer base similar to the the first question that Duncan

39:15 answered before around, you know, the changes in the gaming market. You also had another question around our office footprint. So what does that look like following when once the Taiwan property is sold? So we've already done some consolidation of NEXTEQ's property portfolio. So in The US, we've had two properties historically, which we've operated out of. Already this year, we've consolidated that down into one. One of the leases that we have in in Taiwan, we've moved out that and consolidated the multiple offices office leases that we have in Taiwan down into a reduced number. And then we still have a lease in The UK, which we are paid from and are in the process of concluding the sale of the the auction office, which was an owned property in The UK.

40:12 That's great, Matt. Duncan, if I may just jump back in there as you have addressed all those questions from investors today. So thank you very much indeed. But Duncan, before we direct investors to provide you with their feedback, which is particularly important to yourself and the company, could I please just ask you for a few closing comments? Yes, of course. Thank you. So look, H1 twenty twenty six has been challenging. It would be crazy for me to say otherwise. It's been really difficult in land based gaming driven by what we've just talked around, around volume loss, mainly from the every contract that you're all familiar with. So so really what we're doing internally is focusing on what we could control. So really driving the new product development strategy that we talked about around making more of our software, creating new hardware that allows our customers to do different things, and really, really driving more than the display solutions. And over the coming months, you'll see more and more notifications about about wins that we're seeing. And of course, I'd ask you to remember that we're winning these customers, but because of the onboarding cycle for NEXTEQ, these will start showing their face in terms of revenue as we go through 2027.

41:24 So we're making great progress in the things that we could control, but also focusing on the brilliant customer service we've always given to our gaming customers. So as that market returns, we should enjoy the volume coming back into that market. So Matt and I are really excited about what the next three years will bring And as we show our product development roadmap developing, we look forward to sharing more of that with you the next time we speak. So thank you very much for your continuing interest in NEXTEQ, and we look forward to seeing you again soon. Thank you. Fantastic. Thank you both once again for updating investors today. On behalf of the management team, we would like to thank you for attending today's presentation, and good morning to you all.