Revolution Beauty Group (LSE:REVB) — FY24 Results

0:01 Good morning, and welcome to the REVOLUTION BEAUTY GROUP PLC investor presentation. Throughout this quarter presentation, investors will be in listen only mode. Questions are encouraged and can be submitted at any time by the q and a tab situated in the right hand corner of your screen. Simply type in your questions and press send. The company may not be in a position to answer every question received in the meeting itself. However, the company can review all the questions submitted today and publish responses where it is appropriate to do so. Before we begin, I'd like to submit the following poll. I'd now like to hand you to Lauren Brittonley, CEO. Good morning to you.

0:30 Good morning. Good morning, everybody, and thank you so much for joining us, this morning. I'm Lauren, Lauren Brinkley, the relatively new CEO of REVOLUTION BEAUTY GROUP. And I am today joined by Neil, our CFO, who will also speak you in a little while. So over the course of the presentation today, I'm gonna talk about REVOLUTION BEAUTY business model, our great portfolio of brands, and actually what makes us very different. I'm also gonna recap on the strategy strategy that we launched earlier this year at our Capital Markets Day and provide an update on the important progress that we've already made so far. Neil is then going to talk you through our most recent financial results for the full year, ending February 2024. So let's talk about REVOLUTION BEAUTY GROUP. So REVOLUTION BEAUTY is actually only ten years young as a company. We actually celebrated our tenth birthday on the March 28 this year, and we have already built an amazing global beauty business.

1:27 In our last financial year, we delivered a 191,000,000, in net global sales, which was supporting a global retail business worth around 370,000,000 globally. We are still primarily a makeup, color cosmetics business, driven by the success of the master brands, the the the first brand we launched REVOLUTION BEAUTY. And we've more laterally launched into skincare very successfully with the launch of our REVOLUTION PRO MIRRORCLE cream, and its supporting franchise. And we also have, some smaller categories in areas like hair, fragrance, and men's, but these are significantly smaller and less global in scale. Now we've launched our beauty brands across 75 global markets successfully, and this number is continuing to rise.

2:15 Now our products are designed with a Gen z customer base in mind, and therefore, we have a social media following of nearly 6,500,000, and that's really testament to the strength of our brand with that consumer group. So let's talk a little bit about the unique capabilities of REVOLUTION BEAUTY. So my background, for those that, aren't aware, is twenty years in retail and beauty across The US, Europe, and Asia. And having been in the industry and worked with all the major brands including the L'Oreal Group, the Estee Lauder Group, etcetera, I know this business and and these brands in particular have unique capabilities, and that is genuinely the reasons why I joined this business. So let's talk about what I see, what makes, this business, very unique. So the first thing I want to talk about is the master brand, the number one brand in the company REVOLUTION, The brand that you'll see in Boots and Superdrug and around the world.

3:08 Still today, that brand drives almost 80% of our group business and it's what we're most famous for with consumers and retail. The brand has what I would call genuine brand power. And we know this and we know with that brand power that it can be scaled across more countries, and still more scale within the countries and within the retailers that we are already in today. So that's the first thing. The second thing is that as a business, we've actually built a unique speed to market innovation platform, which means that we're able to land new innovation, new product development for customers from identifying a need or a trend to landing the relevant content or product, within within weeks. It's sixteen weeks, which is much faster than the competition from concept to to landing the products on our digital channels, which is a very, unique way and really is enabled by how streamlined the organization here here is and how close to our, community and our customers that we are.

4:06 Also, we have an amazing team, who are passionate. They're dedicated. They're very experienced in beauty. They're very diverse in terms of diverse backgrounds, diverse thinking, and highly highly creative. And that really gives us also, the opportunity to really make sure we're ahead of the competition. Additionally to that, you may not know, but we actually have our own in house manufacturing, which enables speed, our innovation, and can be used to build improved margins as we scale. So this is actually a skin care and clear liquids factory that we have in Kent in in The UK. Additionally, what's also unique about this business is we've built strength in both direct to consumer and through retailers around the world. So we have about 10% of our revenue coming direct to consumer through our own digital digital channels, 10% from like digital pure plays like the Amazons of this world, and then 80% from omnichannel retailers, which are always a mix between physical locations, and their digital properties and making sure we really show up in a three sixty way.

5:09 And then we've really built a truly international route to market for mass beauty brands, with a combined business model of direct to retail and distribution partners that we trust in local markets. And that's really important because it ensures that we're bringing our business to life and our brands to life in a very, relevant way locally. So we have the ability to scale globally, but make sure that we show up in a very, relevant and local way. So now our strategy has always been to launch REVOLUTION with the best, mass b two retailers in any, market that we launched in. And this strategy has been very successful and is very efficient as it means, you're going where your consumers want to shop both physically and digitally. And therefore, we're concentrating the investment accordingly. And as a result, we built a very balanced global sales profile with a third, coming from our home market, The UK, and the rest coming from international business, including nearly a quarter from from The United States.

6:06 This is all supported by a strong direct to consumer business with our own retail websites in Europe, The US, and Australia, as well as a recently launched Amazon first party relationship and TikTok shop that we literally just launched, just a few weeks ago now. And this image actually you see on the screen is taken from one of our Middle East franchise stores, actually in Oman. We have two of these already and we've planned plans to open a further five with the next one launching in Riyadh in 2025. We're actually the number two mass brand across The Middle East, hot on the heels of Maybelline for the number one spot. So it just, demonstrates to you that in some of the markets, really the power and the strength of the REVOLUTION BAND. And let's talk a little bit about our brands. So, these are our main brands.

6:52 Each, has a very distinct identity and price point, and that's great to make sure that they all are complementary to each other. So first off, REVOLUTION, which accounts for the lion's share of our sales. You know, by listening to our customers' needs on social media, this is a brand that's truly built with and for our Gen z, community. You know, it's based on values that channel the industry norms. It's got a real clear focus on quality, affordability, and inclusive inclusivity. The price point here is anywhere between 3 to £18 with our pro range at the upper end, of that, of that price point. And really, wherever you see Maybelline and e. F. Around the world, we have an ambition that this brand REVOLUTION, can also be present. And we already have lots of data points that demonstrates that, it also competes very, very successfully when we are.

7:44 The second brand in the middle of the slide is ReLove. So we have ReLove as a quality, very budget friendly value brand. And this is really with prices ranging from anywhere from £2 up to £5 in sterling. Now this brand actually has the opportunity to be much more widely distributed across the world, in a different channel. So really looking at grocery and the discount channels, which honestly is a largely incremental opportunity for us here at REVOLUTION BEAUTY GROUP and one of the big opportunities that we have ahead of us for for growth moving forward. And then last but definitely not least, on the right hand side, we have iHeart, which is designed more for the younger younger Gen z and Gen a who are really venturing into bath, body, and their first kind of makeup for the first time. And prices here range from between 4 to 15, £15.

8:34 Very fun, very fashion, very impulse kind of driven. So they're the main brands. So now let's have a look at a quick rundown the business and what really sets us apart. I wanna spend little bit of time talking about the strategy, and our vision as the new executive for the business. So as I outlined at the Capital Markets Day in February, we have a very, launched a very clear and refined called reigniting revolution, which is built to deliver long term sustainable and profitable growth global globally. It was really clear from my investigations into the company when I first started, including speak to leaders at our major retail customers, many of which I know that the company had become a little distracted from what had made it so successful and disruptive in its early years.

9:20 So what does that mean? Well, the business had, done a few things. It really stopped focusing on that fast disruptive, MPD and innovation in its core category, makeup, color cosmetics. It had cannibalized the strength of that core brand that I talked about, REVOLUTION, and had started, launching smaller and less profitable brand variants. It, therefore, unfortunately, become a bit bloated, with too many SKUs, and too much stockholding, too much cash tied up in stock, which therefore had resulted in poor service to our major retail partners on the brands and the products that really, really mattered. And overall, because of that progression with major customers had stall, and it's actually just started to decline in areas like like The US, that you'll have seen from the recent results.

10:13 Now the previous management team had rightly focused on relisting the company, stabilizing the financials, and putting the starting to put in the right level of governance. But unfortunately, a gap had been created in the strategic growth plan and innovation pipeline had emerged as results. Now my new management team, since we have all come into position, have quickly addressed all of these issues. And our new reigniting revolution strategy provides clarity and focus on three major initiatives to get this business quickly back into profitable and sustainable growth. So I wanna just walk you very quickly through what those growth pillars are. The first one is the master brands. So we are focusing back on the brand that started all REVOLUTION. Now with the removal of the unprofitable or less profitable smaller brand variants, we're able to focus those resources and investment into our most powerful brands, a brand that has significant global growth and headroom for scaling.

11:10 And as we've just seen, this is supported by REVOLUVE, the value brand, which will we are pivoting back to be focused on outstanding value for money moving forward. It will also allow us to sell makeup into new retail chains all around the world. And then iHeart will, focus very much on that younger demographic.

11:29 Now the second growth pillar is powering the core. So what do I mean by that? So we are a makeup and a skincare company, and we are refocusing on doing that brilliantly first. The company got distracted into other categories and we need to there's still so much opportunity for our number one, our number two categories, to grow significantly around the world. So what have we done around that? So we've reinvigorated our NPD pipelines at speed in both of those categories. And we will be delivering double digit sales growth in innovation from the second half of this fiscal year. So innovation's back and innovation's going to be very powerful in those two categories. And then the last pillar is focused global growth. So what does that mean? That means ensuring that we deploy deploy the right level of resources to where the biggest growth opportunities are around the world, including the utilization of that unique distributor network that I taught talked about a little while ago.

12:30 And in particular, pivoting growth back in The US. This is the number one beauty market in the world. It's a market that I know very well, and we have a huge opportunity to win in The US, if we get the strategy and the growth plan right. But we can't do any of those three growth pillars if we don't have the best team, a healthy balance sheet, and smart operations to service our customers correctly. So that's also part of the plan. Now by concentrating on those three strategic growth pillars and those three strategic enablers, this should drive us towards delivery of our vision to become a top five mass media player by 2030. Now to get, from where the company was at the end of fiscal twenty three to now and then where we're going forward, we have had to go through a major transformation. So I wanna just double click on that a little bit for you. So this transformation has been essential, for the future success of the brands and the company, and it's progressing really well. And you'll see that in the results that Neil is going to talk about shortly.

13:38 We are progressing very quickly through the exit of the unprofitable unprofitable or less profitable brand variants, and those noncore categories that I talked about. We are gonna have a short term sales impact in the first half of fiscal twenty, '25 as we're not gonna be anniversarying those discontinued brand sales, but we will be pivoting back to growth in the second half of of fiscal twenty five. Also, a result of those changes, we're now now holding significantly less stock, than we did last year because we're running significantly less SKUs across the world. And we've already been able to improve our service levels to over 90% with our major retail customers around the world, which is enabling us to start to have really positive growth conversations with them. We've also been able to reinvigorate our innovation pipeline as I've already said.

14:27 And we've relaunched the company's digital test and scale, that sixteen week process I was talking about at the top of the presentation, and that is already now starting to positively impact the business from this month. We've also moved seven markets that we were actually running directly from, REVOLUTION BEAUTY back to working with distribution partners, because we can see that there are a few markets where we can actually accelerate growth faster, by having a partner work with us on a local basis. And additionally, it helps us simplify our overheads and costs. Now all of these changes are enabling us to get back to year on year growth in the second half of this year as I said, and our team genuinely are very excited about the future of the company. So let's talk about the future a little bit more.

15:16 So as I talked to the Capital Markets Day, and you'll have seen that hopefully, seen that presentation, our ambition is to become a 1,000,000,000 at retail. Retail, that's really important. The retail and sales, a beauty brand business by 2030. Now, this would make us a top five beauty company globally in mass makeup. And you can see on the slides, the really we've got a very, very detailed and clear bottom up build as to how we are going to get there by 2030. And I feel very confident in our ability to deliver on this ambition. And I'm really excited to see the progress already coming through as we're as we're coming through our fiscal twenty five kind of plans. So on that, I want to take a pause, and I want to share with you a little video that really starts to talk about how this new strategy is actually already, starting to deliver and come to life. So I think can we please play the video?

18:47 Brilliant. Thank you. So, hopefully, as you've just seen from the video, we are already making great progress. So the new innovation that we just launched is performing exceptionally well with this particular strong performance in the largest market in The US. And that's actually helping to significantly improve our underlying US retail performance. We are ready to launch our first REVOLUTION new stands and assortment with expanded space in the Australian market. We're expecting strong lift in retail sales. Actually, we're already seeing it from from from right now. And this optimized assortment that you're seeing is actually going to be landed globally, throughout the rest of, fiscal twenty five. We've also just launched, our new Amazon one p relationship, in The US. Already seeing strong growth as a result. And obviously, Prime, day this week, so we're very excited about

19:42 that. And we've just launched TikTok shop, which makes absolute sense for our Gen z consumer, and the fact that we are already a top 10 makeup brands on on TikTok most months. As I've already said, our core category of makeup innovation pipeline and skincare innovation innovation pipeline has been fully reinvigorated from the back half of this year. And we've also actually agreed new distribution for the back half of the year with boots in The UK, and we're launching a DM in Germany as well. With many more discussions for calendar twenty twenty five progressing well as well. But this growth can really only be delivered as I've said already. We've gotta have a strong team, a financially stable platform, and then the changes we've already made over the last few months really are setting us up for for success moving forward.

20:38 I have a new established strength in leadership team. We have a new independent board in place, who are exceptionally supportive. We have already improved our service levels, to over 90% due to the simplified and focused product assortments, and we have a target. We believe we can get that up to over 95% in the second half of this year. A much improved stock position that's driving further improvement as inventory turns as we're actually progressing through through this fiscal year. We have a much tighter grip on our internal process, especially around the financial, stock management, and governance practices. So in summary, there's lots of exciting growth opportunities ahead. And I think with that, it'd be a great moment to pass you over to Neil who's going to actually walk you through the financial highlights for the year that we've just closed fiscal twenty four.

21:30 So over to you, Neil. Thanks, Lauren. Good morning, everybody. I'll take you through the financials. Moving on to the summary slide here. This slide shows the financial highlights for the year that ended on the February 29. And I'm really pleased that we achieved growth at the same time that the business saw a much needed return to profitability after a turbulent time. Revenues were just over £191,000,000, up 2% year on year. That was helped by a significant level of clearance in the first half of the year. Our gross profit margin improved by 5.8

22:07 percentage points to 46.2%, and our adjusted EBITDA came in at £12,600,000. That represented a turnaround of over £20,000,000 on last year's loss. All other adjusted measures and statutory measures were positive, and we've reported a profit before tax of £11,400,000. We finished the year with £8,600,000 in cash in the bank, and net debt was contained to £23,000,000. And that was despite high levels of cash exceptional costs. Overall, it was a great turnaround from where we've been and a great platform to build on from here. Moving on to the next slide. That shows our revenue split by business channel and by geographical region.

22:57 See here that we saw strong growth of 9% in the store business channel, which more than offset the declines in our digital channels. The digital channel is made up of our own direct to consumer business as as well

23:10 the online sales of REVOLUTION products on other platforms. In the year, we saw a significant decline in our direct to consumer business as along with other ecommerce businesses, we observed that customers returned to the high street as it was was the the first first full year with no disruption from the COVID pandemic. And that was exacerbated as we reduced marketing spend and promotional activity to improve profitability in the online business.

23:37 Sales on other platforms were in line with those of the prior year, and we're optimistic about the potential for our new Amazon first party relationship and TikTok shops, which Lauren talked about earlier. On a regional basis, The UK showed a decline overall, but the stores business channel in The UK saw growth, while the digital business declined for those reasons I've just talked about. The US business declined 15% year on year with less investment in marketing and new product development along with challenges in achieving service levels. The US is a key market for the business, and we expect to be able to invest in the future and return to growth. We're really pleased with the progress that Erin Karst, our US president, and her team have made since she started in December last year.

24:29 The rest of the world region grew strongly throughout the year, particularly in the Middle East and Nordic regions, and that was by both expansion of of retail retail distribution and growth in digital sales. The next slide shows our summary profit and loss account and how that return to profitability was achieved. The biggest factor was the increase in gross profit margin. You can see that gross profit was £12,500,000 higher than last year. That was an increase of 16% year on year. The gross margin increased by 5.8 percentage points to 46.2%. That crucial improvement was a result of a few factors. Firstly, a significantly improved stock turn meant that we were able to sell products with less discounts than we have historically.

25:16 Secondly, we were able to clear a lot of old inventory at a higher margin as it had been written down in previous periods. In addition, we saw that freight costs came down from relatively high levels. At the same time, distribution costs decreased 15% year on year as our reconfigured distribution network yielded operational efficiencies. Distribution costs as a percentage of sales were 13.8%, and that was a significant decrease on last year when they were 16.7%. Also, marketing costs were nearly £6,000,000 lower than f y twenty three. The net result of all these improvements was that we achieved an adjusted EBITDA of 12,600,000 million pounds. That's an EBITDA margin of six and a half percent and a significant turnaround from last year's £7,500,000 loss.

26:08 It's also good to see a a a positive adjusted profit before tax result after depreciation, amortization and impairment charges of £5,200,000 and interest costs of £3,100,000. In the text box on this slide, you can see all the adjusting items and how they impact the reported measures to show an underlying level of profitability. The summary for this slide is that the company has shown that it has an underlying profitable business model. It depends on an efficient level of stock turn and effective marketing campaigns, but nevertheless, we can see the potential to improve profitability further in the future. Turning now to our financial strategy. I've already talked about the first element and how we've returned to profitability.

26:57 The second element is about balance sheet and cash efficiency. On an underlying basis, we were cash flow positive in FY '24, thanks to the return to underlying profitability combined with an improved working capital cycle as our stock turn increased. Back at the capital markets event in February, we spoke about how improving our stock turn improves our ability to convert profits into cash. And we believe that there's still a lot further to go on this, and we continue to expect to turn the inventory more quickly. The other vital element of the strategy are cost saving programs. We're targeting £10,000,000 of cost savings over the next three and we're making good progress with improvements in our cost of goods, efficiencies in our distribution costs, and a reduction in administration costs.

27:47 That will enable us to fuel future growth. We're stepping up our investment in marketing, but we'll be carefully testing our approach to new marketing channels and media so that we can get the marketing mix as efficient as possible to then reinvest empowering the growth of the REVOLUTION BAND. So in terms of what that means for the current financial year, FY '25, the impact of discontinued brands, product categories, and SKUs will have a short term impact on revenues in the first half of the year, and the year on year decline will also be impacted by the stock clearance that we saw in the first half of the prior year. So we expect to see a year on year decline in sales in the first half at a slightly higher rate than we saw in the second half of FY twenty four.

28:34 As the impact of the strategy takes effect with a reinvigorated pipeline of master brand focused innovation, we expect the business to return to growth in the second half. With the cost saving initiatives kicking in and improved stock turn, we expect to generate EBITDA at least in line with FY '24 with a significant weighting towards the end of that of the year. And with that, I'll hand you back to Lauren for the summary. Thank you. That's great. Thanks, Neil. So as I think it's clear to see, our performance in FY '24 is already reflecting a major strategic shift. The return to profitability is the result of that greater financial rigor, and we're going to continue to strengthen that more as we move through this this year.

29:22 Now while we're in early stage, we're already seeing those positive signs that the new strategy is beginning to deliver, and this will accelerate, as we move through, the second half of this year. We remain really confident and very excited, in our goal of becoming a top five global mass beauty play by 2030. And I think on that, I'd just like to say thank you for your engagement, and we would be very happy to take any questions. Thanks, Lauren. So we've got the first question, which is when do you expect to return to growth following the work you have done to cut back the product portfolio? Yes. So great questions. So we've already put out in our guidance that we're with year. Year.

30:13 And second with half half of this year, we have a reinvigorated innovation and product pipeline. We have some new distribution landing, and but we're making sure that we're we're ramping up our innovation and our growth in a very controlled financially responsible way to make sure we're also driving those improved stock turns as well. So, very clearly, the plan is that by the back half of this year, we will have returned to growth. And the next question is the £10,000,000 cost savings plan that you have announced, can it be front loaded, or will you spread it out evenly over the next five years, for example?

31:02 I'll take that one. Yeah. I mean, the the £10,000,000 cost savings, what we've guided on that is that it will be evenly spread over the next three years. So accumulating over three years to get to £10,000,000 of annualized cost savings. We're already seeing really good progress with that. So can we go a little bit faster than that? Hopefully, we can. But watch this space. We'll update you as as we go with that. But generally, we're seeing good good savings on cost of goods, efficiencies in distribution costs, and we've significantly reduced the administration costs. But let let's continue with the expectations of £10,000,000 over three years. But really, what we want we are trying to do is embed the transformation of the cost base as in the DNA of the business.

31:56 Thank you. And the next question is the debt profile of the company at £23,000,000 net debt is restrictive, especially with an EBITDA of £12,000,000. Do you have any plans to change this profile? Well, I think where we are at the moment, we're the business is on a firm financial footing, and you saw that strategy. And I think that continuing the financial strategy is the best thing that we can do. So it's more of a self help strategy where we can turn the stock as fast as possible, continue with that profitable operating model. And then also with an improved working capital cycle, we can create that fuel to be able to then invest in increasing the marketing cost, which then leads to more growth and more cash generation.

32:47 So that's what we're we're continuing with that strategy at the moment. And and and hopefully, it will be effective as it has been so far. Thank you. And the next question is, do you have any update on the claims from Chrysalis? There's not not really an update to give there. We can't say, too much about it. But what we'll say is that we're strongly contesting, the allegations made by Chrysalis that you've seen, and we're continuing with our lawyers to engage with Chris List and their advisers. We'll we'll make any further announcements about that case as it comes as as they come along, but so there's not really an update there. But we're definitely very strongly contesting the allegations.

33:37 Thank you. And the next question is, what is the latest on the FCA investigation, and when do you foresee any resolution? Again, there's not not many not much to update there. We it's difficult to say when when the resolution will happen, but what we are doing is very being very transparent, cooperating with the FCA as much as we can. So, again, we'll announce any developments with the investigation as they as they happen. But at the moment, there's nothing to update. And the next question is, would the board consider implementing a policy ensuring the leadership team purchase a certain number of shares or encourage to purchase shares over the next few years as part of their incentivization?

34:30 I think we we definitely consider options in that area. It's difficult for me to comment on on on Lauren's comment on what is really a a question for the remuneration committee. But what what we definitely do want is that the remuneration for the executive directors is aligned with the interested the interests of the shareholders. And and I think that is really all we can say at the moment, but we'd obviously consider things like that in the future as as we develop our remuneration policy. Thank you. And the next question is the reunite reignite the revolution strategy focuses on the master brand and core product categories. How has this strategy been received by customers and retailers so far?

35:19 Yes. So I'll take that one. So so retailers are the major retailers around the world are delighted. Because, you know, they see that the REVOLUTION BANDS, you know, has that brand power to be able to compete against the Maybellines, the L'Oreal, the elves of this world. And they want us to be innovating and to be investing in that brand that they know, has the opportunity to drive them growth, as retailers. So they're really delighted because I think they felt that we were trying to we were trying to talk to them about all these other categories that we want to launch in their stores and all these other stuff that we were trying to do and that we had we weren't really delivering for them what they wanted, which was really us driving growth in in makeup in particular, which is really where they want to display.

36:06 And secondly, in skincare where they feel there's such a big opportunity around the the younger consumer who's really started to enter skincare in a in a much kind of like early way. So, you know, and I remember when I was with with Ulta in particular, Ulta said, you know, Lauren, you've got these power SKUs. You've got this power brands, you know, like we really want you to to be driving and focusing and helping us really drive growth because there's still so many customers and consumers that have never tried your products and how great they are. And so it was almost requested in a lot of ways by by the retailers that we work with. So they're really excited. They're very encouraged. They're very excited about the new innovation that we're bringing through. And they're also excited because we're we're very much making sure we're focusing on our relationships with them moving forward. We're getting the right people. We're getting the right service levels for them. You know, there's nothing worse for a retailer, a global retailer than, you know, having empty shelves for customers. I mean, that that's the worst thing that can happen.

37:10 So they're delighted with the fact that service level is back on track and that we're really powering up what's truly they believe is our, you know, is what's gonna help their businesses and to grow too. Thank you. And the next question is, gross inventory was reduced by 32% and stock turn increased by 47%. What were the key challenges in achieving this, and how do you plan to maintain efficient inventory management going forward? I think I think that what net what match the it was a very challenging exercise, obviously, because we've built up close to a 100,000,000 pounds of inventory. And so to to reduce that down, we had to sell sell a lot of the old inventory.

38:01 But the key thing was going forward on everything that we buy, making sure that we were buying things with a view to selling it and being very realistic with what what we were buying. And to some some degree, that was done almost out of necessity last year. But now I think the the real big challenge is to make sure that we continue with that. And, obviously, there's been a lot of changes in the the SKU profile, but we need to make sure that we're getting better and better and better at the demand planning and demand forecasting, and that will manifest in that a faster stock turn. So we've seen seen that go from a stock turn of once a year to double double that to twice a year.

38:52 But I think it's still a long long way that we could go further on that, but we need to get better and better at lots of different aspects in the business to to keep improving that. Thank you. And the next question is, does the return to profitability strategy include the provision of paying a dividend? If not, when do you envisage a dividend becoming payable? We're we're not thinking about paying a dividend at the moment. So we're literally trying to reignite the growth of the business, get the business growing at the at the rates that we we're used to seeing from a a great brand like REVOLUTION. So at the moment, it's generating cash to reinvest in marketing the brand, making the brand really strong, and reinvest in that pipeline of new product developments.

39:47 So we're we don't see anticipate paying a dividend in the near future. Thank you. And we just got our final question now, which is, can you share any upcoming product launches or innovations that shareholders should be excited about? Oh, that's a tricky one. Right? Because I can't let the the cat out the bag too much because we don't want our competition to to find out. But what what I probably can tell you is you saw in the video, at the very end of the video, I did a little bit of a tease on skincare. So there's something really exciting happening in our skincare business in the first quarter of twenty twenty five. And so that will land in in this, second half for our fiscal.

40:32 And then the other thing I can tell you is that we've really we've really relaunched, our that fast track digital innovation program that I that I talked about. And that's really vital for such an innovative beauty company like ourselves. And what does that mean in reality for customers and consumers? It means that every month now moving forward, you'll see a new we call it REVOLUTIONS HOTDROP, which is is happening for essentially around pay week, at the end of the month. So there's something really new and exciting and innovative now coming back from the group in our core category of makeup, that actually launched this month. And you saw a couple of those on the video. So, you know, really some lots of great innovation, lots of fantastic creativity.

41:21 And definitely, the focus with the brand is making sure we are in constant, conversation with our community, And they're telling us what they want us to create. They're they're asking us. They're telling us what their unmet needs are and that we are responding faster than the competition. So lots of exciting things coming in the back half of this year. And, you know, as we continued our conversations over the coming months, hopefully, I'll be able to share some of those successes with you. Thank you. That's the end of the questions, Lauren. So if I just hand back to you for some closing remarks. Brilliant. Thank you so much. So I think then just on closing, I just really want to say, you know, thank you so much for joining us today, for your fantastic questions, great engagement.

42:13 I think, you know, we we really are very excited as an executive team and and board about the future of the company. And I think all I would say is that we're really looking forward to future engagements like this with our important shareholder base as our transformation, continues and and the growth, starts to accelerate. So thank you again for today. And any unanswered questions, we'll make sure that that we find a way of responding to those too. Okay? Perfect. Laura and Neil, thank you for updating investors today. Can I please ask investors not to close the session as you now be automatically redirected to provide your feedback in order that the management team can better understand your views and expectations? This will only take a few moments to complete, but I'm sure it'll be greatly valued by the company. On behalf of management team of REVOLUTION BEAUTY GROUP PLC, we'd like to thank you for attending today's presentation, and good morning to you all.