S&U (LSE:SUS) — Interim Results for the 6 months ended 31 July 2024

0:00 Good afternoon, and welcome to the S and U PLC interim results investor presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged, they can be submitted at any time by the q and a tab situated in the right hand corner of your screen. Just simply type in your questions and press send. The company may not be in a position to answer every question it receives in the meeting itself. However, the company can review all the questions submitted today and publish responses where it's appropriate to do so. Before we begin, I'd like to submit the following poll.

0:27 I'd now like to hand you over to Anthony Goomes. Good afternoon to you, sir. Good afternoon, and, welcome to all the investors from IFC. Excuse my, slight cough My cough. But we're, very pleased to see you. Can I just quickly introduce, my brother, Graham Coombs, who's the deputy chairman on my left, Ed Aaron, who is the chief executive of Aspen Finance on his right? Here is Carl Werner, who is the chief executive of Advantage Finance. And on on my far right is, is Chris Redford, who is the group finance director. In introducing the

1:14 slides today, I wanted to start off with our wonderful customers and staff. And the reason I say that is over the past twenty five years and this year, we did celebrate our twenty fifth anniversary of business. The reason we've built up such a strong business, both in Advantage and at Aspen, is because of the care and encouragement and attention we give to our customers. And over the last, half year or last year, we've seen, as most customer companies in the motor finance sector have, we've seen some regulatory attention from the FCA. We're learning from that. Everybody's learning from that. That's part of the new customer duty, regime, and everybody's finding their way.

2:04 But inevitably, in the first half of the year, it has had an effect on our collections and our sales ability, which we don't regard as being permanent in any way at all. We're learning, we're strengthening, and as a result, we anticipate as a business, we will come out stronger and fitter than ever. But for the moment, it has had a temporary effect. And as you can see, the results for the six months have been impacted. So the group profit on revenue that's continued to increase has actually dropped from $21,000,000 last year to $12,800,000 this year.

2:46 Most of that is increased impairment. That impairment will inevitably, the second half crystallize into bad debt. Why? Because on a one off basis, our collections ability has been impaired by the regulatory action that the FCA took through the one six six and through the the VREC, but that will be temporary. And Karl will mention to you in a few minutes the action that he is taking to to to resume normal normal business in in in Advantage. On on Aspen, the results are extremely good. It just shows that the wisdom of our starting of business, in the property finance business, only five or six years ago is now reaching record profits and is expected to to go from strength to strength, and and and we'll demonstrate that. So without further ado, I'd like to ask, Chris Redford, our finance director, to look at the group finance.

4:01 Thanks, Anthony. Good afternoon, everybody. On the group financials, we'll start with the income statement. There's some very big percentages on a couple of items that I'll mention. So impairment up a 162%. For those of you who follow the business, that's virtually all advantage. Aspen, the bridging companies, nearly nil bad debt model. So most of that impairment is advantage, and and there has been a significant increase caused by lower collections, which in technical terms means more stage three debt in IFRS nine, which we hope to collect some of it back. But realistically, as Anthony said, most of what's currently provided for will crystallize in h two, which means your current balance sheet impairment provisions of $120,000,000 are likely to reduce in h two as we utilize them. There's been some delays, it's fair to say, in our repossession action where, yeah, we've tried with customers to get payments that they can afford, that process has been exhausted.

5:05 But then the length of time to get the car back under the current restrictions we're working to has increased, which means that more of those debts are still lying on the books. So that's impairment in terms of the other most significant increase that's in finance costs. So I've mentioned there, we've had higher borrowings in H1 and the SONIO rate was also over since H1 twenty twenty three on what we've got as variable rate borrowings. Also in the P and L account, just a technical point on revenue, revenue is 9% up. It would have been up about 3% higher, but for something at advantage where revenue on stage three debt is taken at a net level after provisions rather than at the gross level. So that has a reducing effect on revenue that is probably likely to be there in the second half as well.

5:59 If we move to the balance sheet, this is very simple. So three main items, amounts receivable, borrowings and reserves. You can see the movements in each of those items there. Reserves have gone down 2%, that's mostly to do with timing of dividends, which are weighted towards the first half. In terms of borrowings, they've gone up since the year end, although in the announcement this morning, we did say that borrowings in early October $218,000,000 so it will reduce from there, largely due to lending cautionary advantage. In terms of the amounts receivable, you can see very strong growth in Aspen and smaller growth up to the half year in Advantage. Next slide, please. This is where where is all the money gone slide? So we try and show you exactly where the money is going on a better basis, I feel, in the statutory cash flow. So we're splitting it between what's being collected, what's being lent, what's being spent in terms of costs and what's being spent on tax and dividends too. You can see those figures for Advantage and Aspen.

7:04 Points to note, Advantage has been fairly level in the half year, started at 1 and $76,000,000 borrowings, ended at slightly lower 176,000,000 borrowings, but that also covers the majority of their dividend to S and U, which is also the majority of the group dividend, 10,500,000. So that's fairly flat in Advantage. But in Aspen, as I said, that's really where the money has been invested, gone from $120,000,000 borrowings up to $130,000,000 the half year, mostly through extra lending. So treasury and funding, just a few points that I've noted there in terms of where we stand on our facilities and how we're using them. So without further ado, I will then pass on to the CEO of Advantage Finance, Karl Werner, and he will take you through Advantage's first half performance.

7:54 Good afternoon, everybody. If we turn to the first slide in this section, you'll see mainly for our attention the chart on the left, which shows a fairly significantly improved credit quality of written business done deliberately so so that we employ a tactic of cautionary use of our liquidity whilst we progress through the regulatory engagement process, and we are, moving that, through to its conclusion, we hope, with some optimism in h two.

8:30 And also the fact, a theme that we'll talk about a number of times in this section section regarding the regulator is that way that that enables investment in a new competency, new systems, and tools. One of those being a reengineered new scorecard and approach to credit risk, which we're building towards the end of H2. So obviously, it makes common sense not to put too much lending through the previous scorecard while you're doing that. If we turn to the next slide, moving from lending to repayment, you'll see a number of charts and graphs there that unpack for you the challenges present within H1.

9:18 The key drivers of this, of course, as you've heard mentioned from Chris and Anthony, the abundance of caution during that regulatory engagement. As part of that also, you can naturally get some pooling of your later stage debts, which then unpool at the appropriate points in the near future. I think we're seeing the final play out of macros, the cost of living crisis in our customer base as you would have seen in other lending books.

9:47 And as we have also worked hard to address certain process and resource challenges in H1. But as we sit here today at the commencement of H2, the regulatory engagement is progressing very successfully. Engaged and embracing that process with the regulator in exactly the right manner as I think Ani alluded to earlier. And what we're doing also is making sure that we all reap the dividend as well as our customers from that engagement in terms of our people, the processes, the resources we have to handle, the investment we've made in systems and technologies throughout that process. So we will certainly reap a dividend from that engagement.

10:39 To get into a little bit more detail on the next slide, on the regulatory updates, I would like to sort of call out and highlight that the team have excelled in numerous areas, not only progressing five different in-depth work streams hand in hand with our skilled person and the FCA, but also some great work in the as we close the first anniversary of consumer duty, as well as new and achieving to a very good high standard,

11:11 the new standards in regards to important processes and documentation such as wind down planning, business contingency and data sharing with various regulatory bodies. Not to mention, as well as the borrowers and financial difficulty review, which is obviously advantages part of as well as a number of different lenders. Affordability and sustainability is obviously also very, very important and an in-depth review done on that basis also has concluded successfully. And by way of counterpoint, never losing sight as we started there and as the Chairman started his statement with our customers first and foremost, our strong and positive outcome in regards to customers, the dataset remains as strong as ever, whether that be our service to them as evidenced by the financial ombudsman service, our ratings, our CSI scores, very high levels of customer retention, people coming back to us more than once.

12:19 So we have concluded an awful lot of work in h one. We're seeing the main engagement draw to a successful conclusion in h two, which puts us in a position to be focused on both customer outcome and performance matters in the New Year. And with, dare I say, arguably a competitive edge because we're through all of that, and it's been a very deep and positive and proactive engagement. And we're also a lender that's not impacted by what will be the main story next year, which is obviously the DCA issue.

12:53 If we turn to the next slide, very briefly, unpacks for you in a little bit more detail the voice of our customers, which is first and foremost, and the success following an investment in systems and people, and that a product expertise in all things consumer duty. I would call out specifically for the interest of of the audience some range of specific investments that includes an end to end training competency schemes, brand new state of the art telephony. That we certainly then follows workflow optimization, a greater digitization, an automation of elements of the customer journey, moving to more cloud based platforms, not to mention

13:43 expanding our premises quite considerably gives you a good idea as to our thoughts as to the future, coupled with maintaining those very strong customer proof points. Turning to my last slide, think that's one before I hand back over to Chris.

14:00 Yes, we've had a year of consolidation of investment, but the headline story is not necessarily negative as far as the regulatory engagement. It's one that has been a catalyst for positive change. And I would, you know, just reiterate the investment in the tool set and the machinery of the firm.

14:20 We predict a some open space from a competitor environment, not to mention the market is predicted to remain as robust in terms of unit sales or customer demand as it has been previously, especially as we get past this final quarter waiting for budgets, etcetera. So you're invested in a sort of a fitter, stronger, more capable, deeply invested and cautiously optimistic firm as in regards to Advantage. So I'll hand back over to Chris.

14:51 Thanks very much, Carl. So there are three slides about advantage book debt that we normally show you every half year and so I'm just going to go through those. And the first one is about new lending. You can see that the cautious lending is reflected in the 8,752,000,000 volume that we've put on in the first half of this year. Some of

15:13 the stats reflect the fact that the quality is nudged up slightly in the half year, again reflecting our cautious approach. So 8,367 is an average advance, eight eighty two is an average customer score, and 16.9 interest rate flat per annum. It's largely driven by two features. One, we've got a slight price rise through early the in the quarter in about April, but that's been offset by slightly higher quality where customers get charged slightly lower

15:43 rate. The other feature there is cost of sales. Cost of sales has gone up above the £1,000 mark. That's more a measure of fixed cost efficiency. Most of cost of sales is broker commission, introduced commission, which of course variable, but there are some fixed costs behind that. And because of the lower volume, that's credited above the £1,000 in the first half year. If we can move to the next slide, please.

16:08 This is one that attempts to show the correlation between the way customers make their first payment and the end outcome after five years. So up to five years ago is the hard red line matches quite well, I think, with the blue red line. So there's quite a good correlation there between the way customers made their first payment and the end performance of that cohort in terms of the percentage of bad debts, which is shown on the reverse scale on the right hand side of the chart, so around sort of 15% to 20% bad debts typically. You then hit the pandemic, which is the yellow section.

16:47 And we still think there's quite a good correlation between the way customers make their first payment and the end outcome after five years. So that's now a dotted red line because we haven't quite got there yet, but we're monitoring it all the time. You will see that first payments more recently

17:05 have also been not as good as they were previously. Why is that? Well, it's to do with the cautious approach. So quite often with first customers as well, they might need an income and expenditure doing if they hit their first payment and that takes time and therefore it might take a bit longer for them to rectify a first payment problem that's reflected in those numbers and also reflected in the fact that we think the dotted line

17:35 may finish slightly higher than the blue line would naturally imply. So I hope that gives you comfort in that correlation slide. If we could move to the next slide, please. This reflects something that Anthony mentioned earlier in his announcement. So 69.32% up to date reflects not just reflections, but also the fact that we've got more nonpaying debts hanging around on the book. Why are they hanging around on the book? It's one of the restrictions that we've

18:07 we've had since last December actually in terms of managing the repossession activity takes a bit longer because of the restrictions we're under. If those restrictions are lifted, which we believe will happen within the next few weeks, then generally we'll be more back to normal. That feeds into the provisioning, therefore $120,000,000 provisioning, I expect maybe lower than that at the year end as we start to use those provisions in H2.

18:36 So if you look at the bottom of that, near the bottom of that slide, point zero one plus means any customer that's actually got more than six months arrears. Last time we reported that was only 3% of the book, now it's 6.69% of book, but the reduction in the up to date I mentioned earlier, why is that? Well, it's mainly this lagging repossession timing that I've talked about.

19:01 So I hope that gives you some information about the current status of the book. And without further ado, I'll hand over to Ed Dorrance, who is the CEO of Aspen Bridging, he will report on Aspen's performance in the first half year. Thank you, Chris. Good afternoon to all. Aspen has had a strong start to the year, a good first half of twenty four, twenty five, and this is largely built on the momentum that we created in the second half of last year.

19:31 That's resulted in a number of new records for the company, both in terms of PBT, which is 42% up for the same period, record lending at $92,500,000 on 98 facilities and record net receivables of 149,000,000 Also, very importantly, we've had record repayments, and that's a good reflection of our borrowers' ability to refinance and sell their properties. On the right hand side, just in terms of trends, we're seeing an improving

20:07 outlook and signs for the housing market with a view of lower interest rates to come. Very pleased with the quality of the book. It remains good with only 13 loans beyond term at the end of July. And from an outlook perspective, I would say very positive about both the size of the bridging market, which is expected to grow and also the emerging house price growth that appears this year and is also forecast. Next slide, please.

20:42 So on this slide, we talk here really about what's happened to the business on some key metrics over the last five point five years. You can see the steady growth of new loans on a year to year basis. On our gross advances, we're basically coming out at about $900,000 and we have done that for the last two years. The trend continues in that space. In terms of cost of sales, you can see we're in control of the cost of sales. That has been coming down. We've started to see the benefits of an increasing number of direct customers and that reduces the amount we pay in commission for the loans. Our average gross LTVs are at 70%, and that's steady, and that's in the space that we want it to be.

21:33 And our blended yields have been improving as we had increased pricing and managing our margins. In terms of terms, they've remained the same at eleven months for a number of years, and that's steady as we go. Next slide, please. Thank you. So just to update you in terms of other areas of focus for twenty fourtwenty five, We're very pleased certainly with the ongoing quality, credit quality and also the quality of the projects we're investing in and the quality of our borrowers. So we see that continuing. We're certainly making inroads in terms of returning customers that's increased this year from 26, sorry, to 26% from 15 last year.

22:21 And, we'll continue to try and get our borrowers to return to us going forward. In terms of, you can also see from a channel management perspective, 15% of our new loans are coming direct now, which is important and it helps us to set the full control some of our commission costs. And in terms of from a project delivery overall, we've invested in our website that helps our brokers and borrowers as well as speed of delivery. And obviously, we we couple our ability to move fast in terms of delivering loans in days with other USPs such as visiting all of our properties for ourselves as part of the loan process.

23:10 We've introduced the electronic signing, and that certainly speeds things up for our borrowers and our solicitors. And we continue to invest in our staff. Actually, 50% of our staff are currently on training courses to get accredited, and qualified in in areas like valuations and specialist property finance. And it just shows that, one that will help our help them, help our business, and shows that we're investing for the future. That's me. I'll now hand over back to us. Yeah. Good. Well, thank you, very much indeed, both Carl and and, obviously, Chris and and Ed. I think although we've had a challenging year, really, in terms of regulatory activity advantage, I think you can see that an enormous amount of work has been done in response to that.

24:08 And I think that that will benefit the business in the future, which obviously gives us confidence that we will come back stronger in the long term as a result of this regulatory activity. That certainly applies for to to advantage. And aspirin is not in the non in the non regulated sector, and and it it goes from strength to strength because it's a great market, and it'll get even greater and expand more as small smaller developers actually improve properties in line with environmental considerations amongst other things. So I I that, I think, brings us to twelve thirty five or to 25 25, which gives us thirty five minutes for the questions. And I noticed that we got quite a few questions, which I think are very important indeed. I'm trying to read them, but I think I made notes of them. First of all, Edward g, basically asked a question as to whether the the the, we knew as to what the effect of the one six six or similar restrictions, whether we knew how they'd affected investors.

25:33 In particular, you mentioned bankers and money bars. We don't normally make comments on on our investors, but we do know that this is an industry wide initiative from the FCA. And in one way or another, they will have been affected. We we do believe that we are first out of the gate so far as the responding to a one six six is concerned. And, I'll just ask, ask Karl to to elaborate on that. And yeah. No worries. So I think the question was really is it is it in a regulatory engagement across the market or specific to advantage?

26:19 The answer to that one from Edward, I think it was, is no. So it's across the market. It's the borrowers and financial difficulty review. There are three main themes affecting the most finance space at the moment. One is the BIPFID review. One is obviously DCA or d DIC commissions. And the third one incoming, which is being signposted is affordability and sustainability. With all the other market wide ones such as consumer duty and all the other elements, you know, universally still applicable. I can't quote quote a number. It's in double figures as to those in the same channel as far as the definitive review is concerned. And by looking over those players within our space, you'll see various market commentary for those that are publicly listed or issue as such. So I wouldn't want to comment specifically on the brand names that you've mentioned in your question, Edward. But I think if you do have a chance to have a look into different lenders results, you'll see reference to the BIPID review for those that are impacted of which there's a fair number.

27:33 Let me take the other Yeah. Let me let me just move on to Steven B and Maynard P. Obviously, who know the the business very well ask some very, very interesting and helpful questions. Steven B, can we should we have moved earlier? I think is the essence of of of what you're saying. And you also ask what's the effect of labor a labor government and Rachel Reeves as chancellor will have on regulation. And I think those are a very pertinent questions, Steven.

28:20 And that you also said what are the key learnings. Well, I'm gonna leave the key learnings to to Carl. I'll answer the one on should we have moved earlier because I don't think we we we we we would would like to have moved earlier, but I don't think we could have done because I think that a lot of the regulation regulatory involvement from the FCA related to BIPFID, the Boris and Financial Difficulty Initiative. And the way in which they interpreted the then relatively new customer duty or consumer duty back in October 2023, and don't forget the duty that had been introduced in July 2023, was uncertain.

29:07 And I think still, to a certain extent, is uncertain. I mean, it is it is subject to a certain amount of of interpretation. So we're all learning is the is the answer, and we'll continue to learn over the next few years. One of the reasons why I said in the challenge statement that we're working very closely with the FCA is because it's in their interest and in our interest to do so. And we will gradually hone ourselves in line with the new regulatory regime together with our own with our own commercial considerations. As for Reeves and labor, well, I don't know. My the optimistic side of me says that the labor party has a greater understanding of the needs of non prime customers, decent people who may not have a perfect credit record.

30:02 Those are the kind of people we offer credit to. It's always been our mantra that a customer is worth more than their score and that we like to improve their credit rating as a result of their interaction with us. And we'll continue to do that. And, I think the the labor party is is is very cognizant of the fact that, these people do need access to credit. They need it. They need to a car to to go to work, to to ferry the children from back and forth from school and for other reasons, and they shouldn't be denied it. And, and we're there to help in that way. And, obviously, we're work together to ensure that how we help them is acceptable in the under the new compliance regime.

30:57 Key learnings I'm going to leave to Karl. Yeah. I mean, I'll only answer specifically as it relates to the the regulatory piece. I think there's another question on on other changes. But whenever you have these reviews, right, or sector specific engagement, but all players within that sector, you know, learn something. And if you're lucky, you know, quite a a great deal. So I wouldn't necessarily give you a very long list of of things. But fundamentally, it's about being a higher bar or an expectation is clearly illustrated. So that's kind of what the process aims to achieve, and there's a a long list of stuff there, whether that be oversight, forbearance practices, forbearance options, time for recovery, recovery options for debt, all that kind of stuff. So it is completely arrears and forbearance focused and you get, you know, it's a it's a great benefit to have direct conversations, quite lengthy ones with both skilled people and the regulator directly to to flesh out, so you understand clearly the the right level of expectation and then achieve accordingly.

32:12 Good. Okay. Well, I hope that's helpful to you, Steven. Now we go on to Maynard, who says that, basically very important question. What exactly were the VREC restrictions? And when do we anticipate they'll be lifted? And which of those restrictions are going to be restrict lifted and why? So over to you there, Carl. Yeah. I mean, it's a list of specific restrictions held against the register since December, I think, of last year. Fundamentally, they talked to certain practices and restrictions on ease of progress in certain areas regarding ones that are in collection of payments, and secondly is in repossessions.

33:11 But they are viewable to see the explicit, think there's nine in total. So those are the restrictions which we hope to be lifted. Why is because we have achieved the required standard. And as I say, as we have shared with you our optimism, we've engaged openly and construct ively with the regulator in those discussions. And, you know, have made our case as to reach their required standards, which they're opining on currently. So we will let everyone know in due course. Good. And maybe you also did another question, a subsidiary question to that one, which I was very, very, very, very adversite, which is you talked about regulatory negotiations with the FCA.

34:10 And you asked whether, in fact, they might lead to a more lenient collections practices in the future? And therefore, did it mean that the hiatus in profits was going to be a temporary one because of the collections performance? My own view is that it will be temporary. It may well read that the the profile of collections changes slightly. It might be, it might be lower and it might even be slightly slower, but it'll still be there. And the collections will come in because that's basically how you judge the success of any lending business. It's easy to lend it, we better get paid back. And I think the FCA understand that. But what would you like to comment? No. I think I've encapsulated that. I was looking at the question now.

35:04 I think it's not about sort of being necessarily more lenient. There are certain things, it's a very complicated and involved customer journey, the whole forbearance journey. An industry looks to increase its standards and improve its service continually. But I don't think just by focusing on the regulatory part, we're in danger of losing sight of the many other things that we do by broadening access, high levels of automation, servicing customers in the different styles and tones that suit them best. So it's about achieving the required standard, continuing to focus on the customer voice and the feedback that illustrates how you're doing, and looking across a very broad spectrum of options to ensure that your repayment performance and customer outcomes are are at the highest level.

35:58 And that brings us very nicely onto Stephen B's second question, which basically says, would this restructuring, which he complements the business on, have taken place without FCA intervention? Now, obviously, the FCA intervention was a catalyst, and and we don't we don't argue with that. But one of the principal points that we're trying to get across is that we make a long term virtue out of, what might appeared a short term problem. And the reason why the way which we're going to be doing that is by adopting a whole series of practices and interventions within our business, which make it more efficient and make it more properly customer orientated than it's ever been before. We're proud of our record on collections, and we're proud of our record in improving sales. But that doesn't mean that we can't do better. And occasionally, this kind of catalyst is a requirement for any business in order to improve in that way. So we do see this in a positive way, Steven.

37:22 And I think the restructure, in short answer, the question, the restructuring would have probably taken place without an FCA intervention anyway. But then we've we've made out then I asked some redress and and remediation. And we it it has been that today. I'm gonna ask I'm gonna ask Carl to to answer that. I wouldn't necessarily agree that bad numbers always take longer to add up. I think that may well be that people want to ensure that any remediation that is paid is properly targeted and is proportionate with only U. Yes. I mean, the question there for Maynard, is just is it on the remediation front taking longer and is it prolonged and why fundamentally?

38:22 Forgive me if I've reworded the question in accurately, hope not. Fundamentally, the pace of that piece of work is entirely at the the best of the skilled person and the regulator as to the expectation of it. What I would say on our side, because it's a a joint responsibility fundamentally is crunching the numbers to take a fair amount of time also. But pace of that is really three parties at the same time. Good. Thank you. And then may I ask another question regarding shareholder restructure and the implications for that for buybacks at a minimum discount to net as you pay rather than pay dividends. Why near term dividend is prioritized over buybacks or even the tender offer below NAV, which should generate greater shareholder returns over the longer term. Well, I suppose the answer is that the share buyback makes the market for the shares even narrower because there are less players in the less shares out there to be played with and possibly less shareholders as well. So and given that we're a public company, we do value

39:53 shareholder value as well as capital reallocation was buybacks. We tend to say we'll stay with the same structure and we'll pay dividends instead. So we've obviously thought about other forms of of shareholder structure. But at the moment, we intend to stay with the existing one and pay dividends. Then Edward G comes up with another very good question. Once these restrictions are the V rate restrictions have been lifted, do you expect that the new required status will create ongoing extra costs or impact growth over you, Carl?

40:40 I would say not not really. The cost will emanate from different places. So we'll have a reduced cost in some as we make investment in in other quarters. And I don't think it should impact growth in the longer term. You know, we're a very broad church. I think that's what the and we was referring to all as early as far as the broad range of customers we service now and we'll look to support in the future. But there's an awful lot of runway as to new segments, new distribution channels, new products, new customer types ahead of us. So, you know, it's a very large buoyant and resilient market. So the short answer to that fundamentally would be no. It will be shaped differently, but it won't be excessively higher.

41:31 Thank you, Karl. And Stephen, want to talk about Aspen very sensibly as well, because it's a great business. Over to you. Yes. Well, I mean, obviously, we wanted to create a business that provided diversification also to the group. I think we've delivered on that, bring a profitable business that can provide steady growth and has access to a large market, which we've got a small percentage and can continue to develop that. So I I see us on an ongoing basis creating additional value for the group and contribution to the group in a space and a market that has plenty to go after and plenty for Aspen to.

42:19 Do you understand why it's still plenty to to go for in terms of the the small investors? Yeah. I mean, the I mean, obviously, our target market are these smaller developers, and they are underserved by the mainstream lenders. And therefore, that market has grown and is looking to continue to grow. Obviously, the forecast for opportunities in property remain remain positive, and people are looking to invest in properties. And and we're here to provide both the developer and the investor community, which are very large in The UK. So from that context as well, it is a a great opportunity, and so far, so good, and we're looking to onwardly develop, forward.

43:13 There's also a good cap export of capital market for asset. You know, foreign investors who wanna buy a property over here, we help them with that process. Yeah. Important. Steven, you want me to make the investment case for S and U, and and I'm very happy to do so. I don't think we've lost a thread. I mean, there have been two things that have happened over the last couple of years, maybe a bit longer than that for advantage. Obviously, it's had a major effect on the performance of the S and U, which is not being as we were wishing to have been. But but, you know, these have happened. The first one was obviously COVID, which actually did knock the the profits back for a year.

44:06 And although we were able to recourse you for the following year, it did it did change the market and and and cause problems. Following very closely from which was the previous government's, in my view, unhelpful regulatory emphasis on restrictions to credit for certain sections of society, who they deemed in their middle class way not to be able to to to pay what they've been able quite comfortably to pay over the previous years. I think the labor government will take slightly different view to that. They've already talked about investability in the sector, availability of capital, financial inclusion, these things that they would like to emphasize, which none of which really were emphasized by the conservatives.

45:05 So that's the in the macroeconomic sense, I think that some of the travails that you've you've seen for advantage over the last couple of years are diminishing or likely to diminish. Why Why should you invest in S and U? Well, a couple of reasons. First of all, do Maynard's questions notwithstanding, we do want to maintain a good return for shareholders from dividends. And that's our intention. That's why we think that people hold the shares because they see that there is a contamination of purpose, if you like, between the controlling shareholders and other shareholders, with the family earning more than 52 percent.

46:00 That is one of the reasons why, the investment case of dividends is such a strong one. So I think that is one of the reasons. The other reason is because we're in the right sector. And one of the reasons why we're still looking to buy shares is because we regard them as significantly undervalued in the given the medium term prospects of the company, and that's always the best way to invest. You you invest for the medium term rather than for the short term. And that's why we're still investing. It's very enthusiastic about investing in S and U. So I'll go to G, when do you expect to resume market share growth in Advantage once the FDA regulation ends over to Utah?

46:51 For a number of reasons. As I said, I think the, we should view the regulatory engagement, let's say, has been pretty proactive and good natured, and we will get a dividend from that process. Secondly, it's a very sizable market. Thirdly, we have fantastic people and very strong relationships within our chosen distribution channel. And there's an awful lot of runway as yet not exploited as far as diversifying the distribution and the product range. And we are a business that's been established an awfully long time and has the means to compete. So there's probably a bit of a shopping list there, but it's a great question.

47:39 It's important to view it through the lens of this isn't just a tap on, off thing, and it's all down to the regulator. It's really around the skills, competencies of the team, the commitment of the shareholder. And one thing that is becoming increasingly apparent is that we are releasing or maybe re releasing real energy of innovation and creativity and hunger for future growth as we come towards the exit of that particular process. And finally, I think it's finally, although we've got a couple of minutes left, think. Steven, thank you so much for a very kind, very kind comment.

48:24 We're delighted to to welcome you to the share register. As I said, we will soon be ourselves adding to our holding of the company. And I think it's very positive. And then you also mentioned, is AI going to be an enabler or a threat to the industry? I think it's going to be an enabler because we will be able to do things more efficiently. No. I totally agree. I think it's easy to be overengineered on, I think, all things AI. That's a different discussion. But I like that phrase, isn't it? It's the the jobs are secured with those who embrace AI and those that ignore it are the only ones that are threats. I don't think it's I don't think it's in any way I can't see an angle with with which it could be a threat. If it means that we get more accurate, faster, quicker service to customers, better answers.

49:25 It's gotta be all upside, I would think. We're doing some good stuff in regards to customer engagement that's starting to use AI with digital conversations, hopefully, being trialed in the weeks ahead. And of course, it's it's practicality or the the the use that you can adapt it for the in the credit risk sphere is obviously something that a lot of people are are focused in at the moment. So customer service and credit risk are the two areas that we're engaged with currently, but it's early days. Think from a bridging perspective, it's not a threat. And it will have very limited use if used tool. I mean, terms of our model, it is very much a relationship one on one with both the broker and the borrower, and and that's the way they like it.

50:19 And, obviously, the underwriting is very much bespoke process coupled with significant IP that we've developed from a credit risk perspective. I don't see AI at this stage in terms of bridging. Right. And so I think that wraps it up, gentlemen. Do you have some ladies there? Thank you so much for support. We think that these IMC presentations are extremely useful for the company, very good way of getting directly to our shareholders. We're gonna continue to use you. We'll see you in six months' time. Thanks very much for your attendance.

51:10 Perfect. And I'd like to thank you for updating investors today. Could I please ask investors not to close this session as you now be automatically redirected to provide your feedback in order the management team can better understand your views and expectations. This will only take a few moments to complete, so I'm sure it'll be greatly valued by the company. On behalf of the management team of S and U PLC, we'd like to thank you for attending today's presentation, and good afternoon to you all.