Surgical Innovations Group (LSE:SUN) — Interim results for the six months ended 30 June 2025

0:00 Good morning, and welcome to the Surgical Innovations Group PLC Interim Results Investor Presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged, and they can be submitted at any time using the Q and A tab situated on or 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 during the meeting itself. However, the company can view your questions submitted today and publish responses, which is appropriate to do so. Before we begin, I would like to submit the following poll. And I would now like to hand you over to CEO David Marsh. Good morning to you. Good morning. Good morning, everybody. I'm obviously here with Brent, our CFO, and thank you for taking the time to join us on this IMC.

0:48 If we start by just looking at some of the sorry. Sorry. If we start by looking at the commercial and operations for the first half of the year, the most significant thing that we achieved in the first half of the year and more recently is the successful transition to MDR. For those of you that are unaware, the medical device regulatory bodies have moved from CE Mark to MDR, and this has been a major task for the company to achieve. So we are now recommended for certification in all of our product groups and our q m QMS as well. So this is, as I said, it's it's a major achievement and it allows the company to focus forward looking rather than spending a lot of time and bandwidth on achieving MDR.

1:38 I will talk a lot about it during the presentation because we are rightly proud of having achieved that. On other in other areas, we introduced an operational improvement plan during the during 2024 where we restructured the benefit sorry, restructured the company to deliver benefits. And we're beginning to see those filter through into first half of the year, and they will continue in the second half of the year and move into next year as well. We also see our SI brand growing. This highlights the confidence that the market has in our technology and positions us nicely to continue to grow as we move forward. Our OEM business, we've talked a lot in the past about that, and, you know, primarily, that has been the the business that we have with AMS.

2:31 We've spent a lot of time building partnerships with other companies, and we're beginning to see that grow from a small foundation, and we expect that to grow as well as we go into 2026. In conjunction with our SI brand and the quality that is seeing seeing that grow and the the company sorry, the customer confidence, we're also seeing our sustainability messaging continue to resonate, and we see that in key markets in Europe and in Japan and obviously in The UK. And that gives us the ability to differentiate ourselves from some of the bigger competitors, that we're up against. And then during '24 and '20 the early part of '25, we introduced a number of new third party products to our UK business.

3:21 And we're seeing those contribute to sales, and we're gaining traction with those products as we move forward. Thank you. So one of the things that you will have seen this morning is that the changes to the board. And we're delighted to bring Roy Davis on as chairman. Roy, as you know, has a huge amount of industry experience. He's worked within, medical device companies, similar size to ours and also much bigger. And Roy and I have worked together many years ago. So I've known in our gyros days. So I've known Roy for over twenty years, and he will be an excellent addition to the the board in helping us drive value for shareholders.

4:14 Roy is joined by Andrew Bottler, who has worked with him on a number of projects in the past, and he will help will begin to drive the company forward. And Duncan joins us from our largest shareholder, the Lassa, and he is sort of immensely experienced in aim listed businesses and will provide us some guidance around that. And again, please. So if we look at The UK business, the the top line sales are stable from last year, and we're doing rough roughly the same. And this reflects the portfolio realignment as we dropped certain third party products last year and bought on new products from the likes of Aspen and SURGICAL.

5:11 If you look at the like for like business over the over the two periods, you we have grown the business in The UK by about 10%, and that is partly, some SI branded products, and primarily from some of the new third party products that we picked up. So they're beginning to gain traction, and we see those as real opportunities going into the second half of the year. And we see, sort of real opportunities to add more products to that portfolio throughout the the coming eight twelve, eighteen months. We've invested significantly in The UK Sales Team, and marketing tools as well. And, you know, that has seen, the beginnings of accelerating sales revenue in The UK.

6:01 And I think, you know, with the robust management structure we now have in place, a full team in place, we can start to really see some traction in The UK. In terms of pipeline ex expansion, there are a number of new products coming into into the portfolio in in quarter four this this year. The LogiTube Luxe, which you will see, which you'll see on the new product development slide, they will all help drive revenue and that, again, they're a real opportunity for us. So The USA, that that tends to be our problem child. It has been for a number of years, and we've seen a further slip in revenues over the first half of the year.

6:49 Primarily, this is around, some of the tariffs that, mister Trump has, inflicted on us. And, you know, that they're really frustrating because we see that the that the tariffs are imposed on UK business going exporting to The US, but we're not seeing any tariffs coming back the other way. So that continues to make life difficult for us. What we're doing to try and to work around that is look at different routes to market in terms of some of the new products we've got. So Logitube Lux, we expect that to be FDA approved in the early part of next year. And that is will allow us to tap into the large bariatric market they have in The US, and we're hopeful that that will allow us to pick up some new distribution partners.

7:40 But we are exploring a lot of opportunities around some national companies that we're talking to that might be able to pick up the SI branded products in The US. But it is it is a challenging market for us. And, you know, with the the bandwidth that we have, and, you know, the responses we're getting from Europe, etcetera, we are looking to to focus where we do spend our time. So the market overview overview in Europe. Again, strong revenue performance, followed up followed on from last year's success. This is underpinned by our sustainability messaging and the enhanced marketing tools that we've put in.

8:26 So we've upgraded the financial and environmental calendar calculator. Sorry. And that's producing some good results for us. We're working very closely with our distribution partners around sustainability. And with our French partner, for example, we've managed to get sustainability as a key indicator on tenders. So that's hopeful for the future. Some of the new products that we've launched, the LogiTube and going forward, the LogiTube Luxe, they will give us, growth within the bariatric market. And products like the elite XL, which is a line extension. We're seeing some good traction in Germany in particular as we undertake a 20 center trial. So that's a real opportunity going forward.

9:16 So the APAC region, although we saw an overall decline in APAC, that's primarily down to the business in India, and I'll touch on that in a minute. But the the Japanese distribution partner has grown their business by 9%, and that's showing year on year growth. They're a really good partner for us. They work very closely. We're looking at different opportunities of offer introducing different parts of our portfolio. And, you know, sort of we we expect that to continue going forward. The challenge for us, as I said, was India. And India lost a lot of their sales team in the first half of last year. And so we had to work with them as they rebuilt the sales team.

10:03 We've provided training for them and they've done, you know, sort of that almost back to full full headcount. We expect that to take a little bit of time to to pick up as the sales team learn and understand the products going forward, you know, sort of hopefully, that will be back on on track in the early part of next year. The rest of the world business, again, we saw a a nominal decline. That's partly because of inconsistent sales in The Middle East. Middle Eastern business is always very bumpy, and, you know, sort of we're we're seeing a sort of a bit of a transition there. And whilst our business in Israel has throughout last year remained quite strong, we are beginning to see some impact now of the current political situation in Israel.

10:53 And in Canada where we had some good growth in the early in in the late part of last year, we've had some quality issues that have slowed evaluations and slowing orders as well. OEM business. We did flag that we would see a decline in the first half of this year. If you remember, we cleared a significant back order in h one twenty four, and that's inflated sales a little bit. Those ordering patterns now with AMS have returned to more normalized monthly patterns, and we're seeing that business stabilize.

11:38 But where we are seeing opportunities, the partnerships that we are building with some global instrument manufacturers. And we've seen that business, albeit from a very small base, begin to grow, and there is significant opportunity in the second half of this year and into 2026. And that sort of follows the strategy of looking at opportunities outside AMS to support the OEM business, and I think that's beginning to pay off nicely. So my favorite slide at the moment, the compliance update. So as I mentioned, the company has achieved certification on all product groups now, and that's important to the company for a number of reasons. First off, of course, you know, we can't sell the product beyond 2028 without MDR, and that puts us in a really strong position going forward.

12:32 But MDR took up more bandwidth than just passing the certification. And what we will see going forward is that it will release the burdens on the compliance department, the r and d department, and production engineering. So all of those departments are heavily involved in the process of MDR. R and d can now focus on next generation pipelines, on, new products, and cost down, projects as well. Production engineering can focus on, making the plant more efficient, and driving efficiency savings through the business. And compliance obviously can focus more on regulatory and registration processes in new markets and allowing us to expand our global footprint.

13:21 So it's a it's a real opportunity for the business to start looking forward again and drive where we are with, you know, sort of the the compliance side of things. In terms of costs, there will still be a surveillance cost for maintaining MDR, but the the major expenditure should begin to reduce and, you know, sort of we can focus that into more productive areas for the business in terms of revenue. So this places the company in a really strong position. A lot of companies are still continuing to struggle with MDR. We've now we've achieved that. We can start focusing on new markets, new products, and driving forward. So this really does allow the company to focus on moving forward.

14:14 So sustainability continues to drive growth for us. And, you know, I know I've I've talked about this for over a number of years, but we're still seeing that it gives us a chance to differentiate ourselves from the competitors. And we see that in Europe. We see it in The UK, and we see it in Japan. And what it does, is it allows us to, have a different conversations with health care providers. We're no longer having that initial cost, which is about price. We're having a conversation with their sustainability teams about reducing their plastic waste and their c o two footprint. And we do that by using a number of marketing tools, in particular, the financial and environmental calculator. So when we sit in front of their sustainability teams, we punch in all the data, the number of laparoscopic cases they do, the product that they currently use, and that will produce them a report on cost, on their c o two footprint, and the amount of plastic waste that they have. At the same time, it gives them comparative data on surgical innovations product. And if they switch to us, what they would save in plastic waste, what they would save on their c o two footprint, and also what the cost reductions would be. And we generally will show them that we can reduce those targets by about 70% and between 2550% in cost as well.

15:42 So it's a really unique selling point that we have, and it helps us avoid the starting point being around, you know, how many pennies can we save to our procurement department, and it's about how much plastic waste we can save. Just struggling to move it up. Hang on. Hang on. There we are. Yeah. So in terms of new product developments, as I mentioned earlier, you know, they a lot of their focus has been on assisting with the MDR process. We have quite a small team at the moment as as part of the restructuring. But now what we can look for is driving cost initiatives through the or the cost down initiatives that we've had and we've been working on for a number of years. And the first two of those will be introduced during the tail end of '25, and we'll see the benefits in 2026.

16:45 So if you the product on the right hand side of the screen, that's our yellow port elite. And we've changed manufacturing techniques and materials that will allow us to take about two pound out of that product going forward. So that will significantly improve the margins and what it at the moment is quite a tight margin product. So there are a number of these projects that we hope to introduce during twenty twenty twenty twenty six and will help to improve margins on our high volume consumable type products. The other picture that you have on there, illuminated product, that is the Logitube Luxe. This is a product that is had particular resonance in The US. They they they like to have an illuminated version, but also in Europe too. So what this product does is a gastric calibration tube, and it sits in the it's inserted transorally.

17:45 It sits in the stomach, and it provides a guide for the surgeon to make sure that he doesn't make the existing, pouch too small. In bariatric patients, you have a lot of fatty tissue, and visualization of the tube can be quite tricky. By illuminating it and it fluoresces as well, it makes life a lot easier for the surgeon to visualize exactly where he's placing the tube and reducing the size of the stomach. In terms of future projects, we're looking at the next generation access device. And again, you know, sort of that is to improve the functionality and to drive costs as well. So, you know, sort of there are a number of ongoing projects that we have, particularly around materials, and we're in very early stages of working with with University of Leeds to look at possible new materials and and see how that will generate opportunity for us going forward.

18:52 Next slide, please. Okay. Good morning. So I'm Brent Greitman, the CFO for the SURGICAL GROUP. And over the next five slides, I will be providing a final financial update of the first half of this year. So as you can see here in in front of you, if we look at the the revenue performance for h one twenty twenty five, it's it's actually very comparable to, the prior year, down slightly, but broadly in the same. And and despite the so the headline number is is broadly the same, but as as David spoke to a moment ago, the composition has kind of changed somewhat. It was kind of still holding the same revenue position. What you'll observe is that the gross margin at 31.3 percent is lower than the same period last year, albeit is is markedly improved on the the full year 2024 position.

19:41 And, really, the driving factor there is is the, the customer mix. Of course, that can then move the margin. And as mentioned, we have seen a change in the revenue composition, which has impacted the gross margin a little. If we look at the profitability metrics, so that's adjusted EBITDA, adjusted operating profit, and adjusted profit, earnings per share, you can see marked improvement versus h 01/2024. And and, really, this is a reflection of the the cost saving measures that David touched upon a moment ago and some of the restructuring activities that we were that were undertaken, last year and throughout, throughout the year until September. And so, really, last year in twenty twenty sort four, we saw a lot of efforts around rightsizing the the cost base to to reflect the, the the the top line deliverable.

20:30 And as a result of that very difficult exercise, we're able to remove a lot of costs from from the business. But what that means is, of course, as we've moved through this first half of the year, we're we're realizing that benefit as a as a result of the the lower cost base and therefore seeing improved profitability metrics. Next slide, please. I won't spend too much time on this revenue analysis insofar as David spoke to this, of course in in-depth a moment ago. But what you can see here on this on this visual really is is the cut of SI distribution and OEM. And as David mentioned, you can see the the uplift in the SI and distribution sales, partly offset by the reduction in the OEM sales. But as I say, I won't speak speak too much to that. So if we move on to the next slide, please, in the margin analysis.

21:18 Okay. So we're looking at here really is the margin down to the contribution level. And as mentioned, you can see that while it's below the h one twenty twenty four position, it's markedly up on on the last year's full year performance of 28.8%. So what we find is is a challenge, of course, is that throughout this first half, there have been limited price increases running through the first half of the year. So, naturally, that constricts our ability to drive margin improvement because the price uplifts are modest. We will see more in the second half of the year. In this first half, they were they were limited. And and and like every business, of course, we continue to see cost, cost pressures as our suppliers, seek to pass on, inflationary price increases to ourselves.

22:05 So from our point of view, we it's always around kind of can we optimize the margin performance by introducing cost cost down initiatives as as David spoke to. Can we introduce operational efficiency measures across the wider business to ensure that we are operationally excellent, delivering and manufacturing our product in the best possible manner. And at the same time, of course, being able to push back on price increases that may come our way from suppliers. And at the same time, of course, where we can in our very competitive marketplace, push forward with price increases where it's all possible. So the contribution margin, as I say, it's broadly similar to last year, improved on full year last year position, but we're optimistic that as we move into the second half of the year, we will see improvement.

22:54 Next slide, please. What this slide here, operating expenses, illustrates really well is the impact of, the restructuring activities undertaken, in 2024. As mentioned, considerable cost was removed from the business in the first half and continued into the second half of of twenty twenty four. And, really, we're seeing that, benefit in in the first half of twenty twenty five. And, really, the the the bar chart illustrates where we have seen those savings in particular. So you can see that in terms of sales and marketing investment, we've seen considerable reduction, h 01/24 versus '25, but we've also seen reductions in amortization. And so, really, this first half of twenty twenty five has been about reflecting about the position we find ourselves in having gone through a challenging journey in 2024 and just treading very carefully and very responsibly as we move through this first half of the year, could then really reflect on the position we find ourselves in in terms of financially, commercially, of course, with regards to cash also, then allows us how we, then allows us to consider how we will approach, the second half of twenty twenty five.

24:05 And and I think what we're gonna see this second half is is is some modest uplift, in the cost base, certainly around sales and marketing, but that's more, to ensure and support sales growth as we move into the second half of the year. And and and, of course, it goes without saying that whilst we took the very difficult exercise of taking costs from the business in 2024, we certainly do not view it as a, job done. You know, we can continue to to review the business and and manage margins as tightly as possible looking at all areas to rationalize the cost base, to optimize operational performance, to ensure that we extract every possible element of margin that we can. Next slide, please. Okay. So if we look now at the financial position and then I guess really looking at elements of of the balance sheet, I mean, some areas that kind of would flag as you kinda look down at the columns really is, in terms of our inventories, we've sought to reduce the inventory the inventory holding position from, December to to June. You can see it's reduced from almost 3,000,000 to 2,600,000.

25:09 And really, that's, of course, as a result of a conscious effort to ensure we hold the, the right levels of inventory across the business so that, cash is not tied up in excessive working capital in the form of inventory. And whilst we've made progress by seeing seeing a, say, material reduction, we expect it to continue as we move through into the second half of the year. And, really, it's a balancing act to ensuring that we hold we do not hold more inventory than we need to whilst, of course, ensuring that we can always satisfy customer demand and is striking that right balance. And I think we're certainly making headwind headwinds headway on on that journey. I think it will certainly be supported by the fact that we've just, recently had an operational director join the business who will also help further in in that exercise.

25:55 When we look at trade receivables, you can see it's increased to 2,200,000 compared to 1.75 at the year end. And, really, it's let's say it's you might describe it as unfortunate timing insofar as that June position is the highest position that we have seen all year. And and, actually, that position has unwound considerably since June to a much lower position, in July, August, and then continued into September. And really that spike you see, in June is is nothing more than the fact that we were onboarding a new credit control within the finance group, and it was simply a case that they took a a month to get their feet on the table, you might say. So now in terms of receivables, it is fully up to date. Nothing is overdue, so it's in good health, which, of course, supports working capital, but more importantly, supports cash balances also.

26:44 Trade number payables, they're generally flat compared to the year end, so not so much change there. In terms of cash and cash equivalents, you can see the position has worsened a little since the year end, but it's still in good health. Well, as I say, what we've seen since June is that cash and cash equivalents position has improved, closer to 100 k from the 460 k. You can see on screen, as I say, most of that is due to the fact that the accounts receivable position has unwound. As I say, I expect that to continue into September to ensure that that cash and cash equivalents position is is optimized. And at the same time, since June, we found that our cash headroom position has also improved again as a result of unwinding the trade receivables. I also like to mention in terms of the borrowings, you can see the borrowings has reduced from 500,000 to 330,000 at June. And this is as we pay off, the CBILLS loan, that we chip away at each month, of course, and that we fully paid off, partway through h one twenty twenty six. So that loan is is nearly, fully repaid and again, will allow us to introduce more cash back into the business.

27:55 So I'll now pass you back to to David for the summary and outlook. Thank you, Brent. So where where we see the business today is, you know, we've been successful under very difficult circumstances to roll out new products, and we continue to do that with products like the Logitube Luxe. And they will offer opportunity and may offer us some routes to market, particularly in somewhere like The US. I've waxed lyrical about the MDR, and that's the major achievement that that is for the for the business And what it brings to the business in terms of freeing up bandwidth in r and d and production engineering and, of course, our compliance department and sort of potential cost opportunity or cost reduction opportunities going forward.

28:45 But it's it also allows us to position ourselves now as, you know, sort of a first class medical device company that have achieved MDR. And so when the deadline comes in 2028, we will be very well positioned as companies will be dropping away because they haven't managed to achieve it in time. We put in place a a very stringent cost reduction plan in 2024. And as Brent mentioned, you know, we we managed that very well during 2025 as well to make sure that we didn't just return cost to the business, and we're seeing some positive impacts as we move forward. Sustainability remains a key selling point for us, and we see that this gives us opportunities in a in a number of key markets.

29:40 As I said, The UK, Europe, and Japan. We're working with in Canada as well where it's has gained some traction, and that gives us a unique selling point against major competitors. So sustainability is a key driver for us as we go move forward. And I think now that we we have a strong platform for the business to move forward, and we are sort of we're confident we're in a position to deliver longer term sustainable growth And that as we move forward with new products, with cost down projects, the the business will be well placed to improve margins and to start growing revenue as well.

30:25 So I think, you know, as as I said, you know, the the company is well placed now to take advantage of of all the changes that we've made within the business. So that concludes our presentation, and over to questions. That's great, David. Brent, thank you very much indeed for your presentation. I will now turn your cameras back on. 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. And you. I'll I'll turn turn Thank you very much. Gents, we've got a the few the questions from investors.

31:12 One is regarding sales in The U. S. European sales grew strongly, but in The U. S, it remains constrained. What steps are being taken to mitigate tariff impacts and unlock new US distribution channels? Yeah. It's a it's a really good question, and it's one that's, you know, as a as a sales and marketing team, we look at every day. The tariffs are obviously not within our control, and it doesn't look likely that The US are going to reduce those tariffs going going forward. As I mentioned, it's it's you know, we're being penalized because American companies importing to The UK not impacted by the tariffs.

31:57 So what are we doing to mitigate that? So we're working very closely with our distributor in in The US at finding pricing solutions in return for volume discounts. We are looking at different routes to market and whether that be through utilizing some national companies that we currently work with on other projects or whether it's finding, a network of, independent distributors. The challenge for us there is that the cost and the time that it takes to to pull those together is very significant. And so as a small company, we've been focusing on markets which we can develop much quicker. Europe being one of those. And, of course, you know, time time to Europe is significantly less than to The US.

32:50 But we keep exploring options, and, you know, we're we're we're certainly exploring every option that we've got, whether that's placing someone in The US or that has some extreme cost, working with national companies or looking at independent distributors. But it's it's something that we are working on. Thank you. In terms of new products, one more question from the same investor is is how significant is the upcoming launch of LogiTube Lux and the expanded yellow port elite range when it comes to revenue growth and margins in 2026? So I think the expanded yellow book range, that's been with us through 2025, and it's it's it's more to allow us to access sort of more speciality.

33:39 So if you take the cutting shielded trocar, that's something which gynecology, are particularly keen on, and the Elite XL is for bariatric surgery. So what it does is that within an an account, it allows you to sell more product across the board rather than, you know, focusing on the elective surgeries of gallbladders and hernias and things like that. So it it gives us greater opportunity when we're in account to expand our input into that account if you like. The LogiTube LUX is is an interesting product for us. So there are some markets where we've struggled to get the standard LogiTube into because of the the surgeon requirement to have better visualization of where the tube is placed. The US is a particular one there. And that's, you know, coming back to the first question, that's where we think that we may be able to encourage interest from independent distributors to to come on board and pick up the whole portfolio.

34:41 So the the obviously, they they will add revenue growth to the business. But I think our real opportunity from around margin are the cost and projects that we're running through our r and d team. And the first of those is introduced or the first two of those will be introduced in the second half of the year. And they provide us a real opportunity through our higher volume consumable products to make a a much better margin than we currently have. There's a question regarding m and a. How much do you see m and a playing a role in accelerating your international expansion, maybe in US or APAC? Interesting. So m and a is is always something that we have, you know, an eye on and looking at opportunities to grow the grow the business through m and a activity.

35:32 I think, you know, sort of certainly 2024 and 2025 have been about consolidating the improvements we've made to the business and, you know, sort of driving cost out of the business to position us in a much better place. I think m and a activity today is is probably something that we're we we don't have the bandwidth to focus on. But, you know, going forward as the company position improves, then that is something that we would we would pick up. In terms of using it for geographical footprint expansion, I think it's, you know, it's eminently sound thing to do at some point in the future. And if we were looking to put some, you know, a business or manpower into The US, you know, sort of maybe some m and a activity or some joint venture activity or something like that would be, you know, an interesting proposition.

36:28 But we don't have those those significant plans at the moment. Just on the board changes, I know you've talked about this already on the slide, but one of the investors had just asked, you know, is there any further comment you can give regarding the board appointments announced this morning? So I I guess in terms of where we are with the the the board now, I mean, obviously, John and have stepped down from the board and, you know, sort of personally, I would like to thank them for all of their input over the last two years. You know, they've contributed significantly to the business. But I think where we are now, you know, having Roy as chairman and having someone with his experience in companies similar size to to SURGICAL INNOVATIONS, I think, is critical for us, and will help us create value for for shareholders.

37:20 Andy is obviously, as I said earlier, has worked very closely with with Roy so that there's a good partnership there. I know Roy from, you know, for a significant amount of time. So that's a good partnership too. And I think, you know, sort of Duncan coming on board as well will help provide focus to, you know, driving the business forward. Thank you. There is a question which I you won't be able to ask answer, I'm afraid. But there's a question regarding the group's medium term target for revenue growth and EBITDA margin. You're not providing that guidance to externally. But I just thought rather not answer it, I can at least let investors know that the market forecast for next year for revenues to grow to 12,400,000 for an adjusted EBITDA of no point five. But apologies.

38:09 There are some questions that just Exactly. That can't be asked answered, unfortunately. The last question we have, though, is again, you've talked about this already throughout your presentation. But, again, I'll ask that question about sustainability being the differentiator and how you're positioning yourself against larger medical devices. And you've obviously talked about the financial and environmental cal calculator. But is there anything else you can add? No. I mean I mean, I I I for for us, that is the way that we differentiate ourselves from the Medtronic's, J and J's, and the applied medicals. And, you know, it it is it is a key driver of our business in, I was gonna say, the more sophisticated markets. But certainly in in The UK, in Europe, in in Japan.

38:58 And, you know, the tools that we pulled together have you know, they've been built up over, you know, a number of years assessing how we can drive that messaging through and, you know, sort of a lot of companies come in with greenwashing initiatives, but they quickly found out where, you know, by being able to actually demonstrate the reduction in c o two, the reduction in plastic waste is is a real key driver for us. And, you know, when when we you know, it can be simple things. The calculator's a great thing. When we go on an exhibition stand, we have two of the yellow bins that they have in an operating theater. And one of them shows the amount of waste from, you know, on a tip typical gallbladder operation and the amount of waste you would have from SI branded product compared to J and J or applied medical or whatever. And, you know, it's it's a stark contrast and a very visual message. So we continue to develop the the the strategy for developing the message and promoting it to the marketplace.

40:07 And the good thing is that we're seeing a lot of health care providers now looking to well, in fact, they're targeted by their governments to reduce plastic waste and c o two. And, you know, we're providing them with a solution to that. That's great. Thank you very much indeed for addressing all those questions from investors today. And, of course, the company can review your questions submitted today, and we'll publish those responses on the SME company platform. But, David, before I redirect investors to provide you with their feedback, which is particularly important to the company, could I please just ask you for a few closing comments to wrap up? Yeah. Thank you very much. Yeah. I I think as both Brent and I alluded to throughout the presentation, you know, what we've established now is a strong platform for business to move forward. The MDR gives us a bit more bandwidth to focus on projects that will drive cost initiatives through the business.

41:00 And, you know, we we are now well well positioned that as MDR deadline comes closer and companies drop away, you know, as a as a group, we are well positioned to be able to pick up that slack in the marketplace and to drive our sustainability messaging through through the the global markets that we're we're focusing on. So finally, just thank you very much everybody for for joining the presentation, and, you know, thank you for your questions. All good questions. David, Brent, thank you once again for updating investors today. Could I please ask investors not to close this session as you and I'll be automatically redirected to provide your feedback in order that the board can better understand your views and expectations? This will only take a few moments to complete, and I'm sure will be greatly valued by the company. On behalf of the management team of SURGICAL INNOVATIONS GROUP PLC, we'd like to thank you for attending today's presentation, and good morning to you all.

41:57 Thank you.