TruFin (LSE:TRU) — Interim Results for the six months ended 30 June 2025

0:00 Good morning, and welcome to the TRUFIN PLC Interim Results Investor Presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged, and they can be submitted at any time using the Q and A tab situated on the right hand corner of your screen. Simply type in your questions and press send. The company may not be in a position to answer every question it receives during the meeting itself. However, the company can review your questions submitted today and publish responses where it 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, James Van den Berg. Good morning to you. Thanks, Alex. Good morning, and good morning, everyone. Thank you for joining us in this present interim results presentation. So, yeah, I'm I'm James Van den Berg.

0:47 I'm the CEO of TRUFIN, and I'm gonna go through our first half year results, a little update on how July and August are going or went, and and then open for questions. So, as you know, we are a holding company. We have majority stakes in three companies. We're gonna go into each of them in more detail later. But for those who don't know, Oxygen is an early payments business. It also offers insights and data services to local authorities and their suppliers in The UK. Citago is a offers lending as a service products, embedded finance and credit control tools in The UK, and PlayStack is a publisher, a games publisher and developer, again, based in The UK and also has a number of people who operate from The US.

1:45 For the eagle eyed amongst you, you'll notice that the one change on this slide from when we last spoke, is that we now own roughly a circa 98% stake in Citago. So when we last spoke, that was at 90 that was at 74.7%. That's because there was a recent funding round, which we participated in, and the third party investor, decided not to participate in. So, hence, that's the reason why our our shareholding went up dramatically. So today, we're focused on the first half. What does this chart show us? So what this is, this shows us the revenue, of the group, for the last number of years. So in 2024, the first half revenue, which is the the the dark green sort of, part of the bar chart at the bottom, that's the first half. The second half is the top half of the bar chart.

2:48 First half revenue in 2024 is 25,300,000. And in the first half this year, it's 36,000,000. So that's an increase of 42%, which is a fantastic achievement, a great performance. But what does this mean for the bottom line? So this slide, I'm getting lots of numbers, but a similar message. This slide, you focus on the charts, the bar charts to the right. This chart shows that shows that, EBITDA in the first half twenty twenty four was 2,900,000. EBITDA in the first half this year was 6,900,000. So a 136% growth. I I also think it's worth pointing out that, the EBITDA, this year so far is almost it's almost already eclipsed the the the the EBITDA in the whole of, 2024. I think it's worth pointing that out.

3:47 And the good news continues. So, July and August, our revenues are in excess of £11,000,000. That's more than 90% growth year on year. Most of that performance is as a result of very strong performance from Playstack in July and August. There were two game launches. Abiotic Factor, was in early access and went to full launch in July, and Voidbreaker launched, in August. So two extremely strong months for us. And I though I'd love to say you should extrapolate this out to the end of the year, I mean, you would be very unwise to do so. Obviously, we'd we'd love performance to continue in this fashion, but those were two particularly strong months for us. So Great. Thank you. Thank you, Alex. So so lots of lots of numbers on this chart.

4:46 I think on this slide, I think what I I'd I'd really do like to pull out here is EBITDA. The EBITDA, we mentioned, is 6.9 in the first half. What you'll notice is that the EBITDA margin went from 11.4% in the first half last year to over 19%, 19.1% in the first half of this year. So that shows that we're not just increasing revenue, but we're also, got a very, very strong handle on costs. The other point I think worth putting out is our cash and cash equivalents. So cash and cash equivalents at the end of the first half, was 18,000,018 million pounds. And there's a little footnote there, which you need to you need to be careful yet. So we had a a buyback program in place, which we started off early this year, £4,000,000 buyback.

5:37 And since, the end of June, since the end of the first half, we have completed an extra 2,500,000 of that £4,000,000 buyback. So you shouldn't think of the cash as £18,000,000. You should think of the that £18,000,000. Since then, we've spent £2,500,000 of it on a buyback. We bought the shares back. That that that share buyback program is now complete, and we bought back those shares at an average price of 97 p. And there's also working capital differences, which do even out over time. But, again, I I I think it's important to to note there are some there are a lot of receivables, creditors in these numbers, but still a a a great number. I mean, off this chart, we also announced that, cash at the end of August was 18,500,000.

6:26 So, again, we were at 18, spent 2,500,000 of that on a buyback, and we're now at 18.5. So it shows you between the end of June and the end of August, you know, we've been cash generative. Again, with the caveat that there's there's working capital movements within that. But nevertheless, I think it hopefully shows you the general trend is very positive in terms of cash. So we're gonna go into more details on the subsidiaries later, but just a very quick summary. PlayStack had an exceptional first half, and it's also got a it's got a very, strong pipeline of games lined up for the second half of this year and for 2026. Auction, as we said before, we're gonna demonstrate the operational leverage, and that's being demonstrated by the significant EBITDA improvement that's happened this year. And so, Targo, the rep the revenue in the first half twenty twenty four, was benefited from the revenue we had, with a tier from a tier our tier one bank partner. So look. First half twenty four, we had revenue from the bank our bank partner.

7:30 First half this year, we didn't because we the the bank, terminated the contract, in the summer last year. So they're not really like for like periods, but still, you know, so so revenue did decline by 56%, which is is we did expect that. We've subsequently, restructured the cost base very aggressively, and we'll go into into more detail, on that in a minute. Thank you, Alex. So oxygen, as you know, we're extremely lucky to own this business. So why do I say that? So I guess the three big points about Oxygen. The contract terms, for Oxygen are five years in duration, that gives incredible visibility of revenues.

8:19 The their clients are local authorities and the suppliers to those local authorities. So that's an enormous market to go after. So we've got very, good visibility of earnings. We've got an enormous market to go after, and the barriers to entry in this business are extraordinary. So you just ask any one of our competitors or old competitors because we don't really have any competitors now. People try and enter the market. They struggle in for all sorts of reasons. We can go into at another time. And so every time I hear there's another competitor to auction coming to market, I always think good luck, but I I I couldn't be less phased. There there's obviously things I worry about with auction. I have all businesses, but one a competitive competitor coming in, I do not worry about. No one's got the patience required to build a business like Oxygen.

9:10 So Oxygen is now building over a thousand clients. We're servicing over 30,000 suppliers on behalf of our councils. This is this is what business this business is really scaling scaling. And you can see last time we spoke, we mentioned that you're gonna see, a big improvement in EBITDA in 2025, and you can see that coming through now. So, h one the the chart on the left bottom left, you can see h 01/2025 EBITDA has increased to 1,600,000. That's up from naught 600,000 in '20 in the first half twenty twenty four. It's a 151% increase. So a great result, and that is despite a very disruptive, event that occurred in The UK, this year. So, there's something called the procurement act. I doubt, many of you have heard about the procurement act. Procurement act came in force in, '20 on the February 24 this year.

10:06 So what is what is the procurement act? The procurement act, mandated, or in a different way for councils and local authorities to procure. So there's more governance. They've got to update, their processes more often. They've got to train their procurement staff ahead. They have to try and train their procurement staff ahead of the procurement act. They've got engaged differently with their suppliers. There's more contract management once the contract's issued. There's no more notices to suppliers. And, ultimately, that's the issue. There's more processes for, local authorities to follow in order for them to procure. And people, as you know, don't like changing their habits. I don't like changing my habits. I'm sure you don't like changing your habits.

10:51 And and, I can tell you, looking at this graph, we also know that procurement officers at local authorities also don't like changing their habits. So this graph shows the thirty day rolling average, tenders, number of tenders by volume, not by pound amount, by volume across the England. So, this is the total number of contracts that are out in tenders that are out in the open market in England since January 2024. And this note this excludes Greater London because that distorts numbers. So you can see ahead of the procurement act on the February 24, there was a big rise in the number of tenders that were issued. And that's because, being cynical, you know, if you know there's gonna be an enormous, like, increased onus and, number of processes and steps you're gonna have to follow through to procure after the February 24.

11:47 What happens is people procure before the February 24. So that's what happened at a very large number of, tenders were issued before February 24, and then it falls off a cliff, and it's now returning to a more normalized level. To put it into perspective, if you look at, from the January 1 to the end of August, so the year to date, number of tenders, in The UK versus exactly the same period in 2024, the number of tenders has declined by 24%. So there's been a drop in the number of tenders, that have, happened in The UK, year over year. So that's that even takes into account the big rise that we saw before '24, February 4, and the big decline since.

12:33 And that's because, many councils and local authorities have also what they've done is rather than retender for a contract, they can just extend the contract. So there might be a two year, potholding contract, and they've just extended by year. And that means that they also don't have to go through a new tender process, which means they don't have to issue a a contract with 14 notices and do it the new way. They can just extend the contract. So we that this has caused a muted, I mean, fair to say, a big reduction in the number of tenders that have been issued by councils in The UK, this year. And that is now normalizing. So I think it's important to say that's now normalizing. But I would say this, that if you look and think about it another way, our we are volume driven.

13:22 So the more tenders that go through, the more pounds that go through, our clients, the the better off we do as a business. So despite volumes falling by 24% in The UK, our revenue in the first half was up 27%. July and August is a bit more muted. We we grew by 12% over that July and August. So obviously, slower than the 27% growth in the first half, but that's in the environment where the whole our market is down 24%. So I think we're something we're we're very pleased with that, but still, July and August was a more muted performance than the first half. But this what this doesn't do is change the fact that, we've got an incredible long term we have incredible long term visibility and an auction. So what this graph shows you is that if we didn't win another client ever again at auction, that 90% of the next four years revenue is baked in, to the numbers. So if we didn't win another client, we would we would hit 90% of our revenue budge of our forecasted revenue growth for the next four years.

14:33 So it's an incredibly and and and, again, going back to the early point about the PURIN Act the PURIN Act will wash through the system, Councils and local authorities, etcetera, will start procuring again. They found ways to avoid doing that short term as they get used to new processes, but they will come back, and tenders will and volumes will rise. So this business is in rude health. Yes. There's a a big market distortion happening at the moment, and we're riding that, you know, that little storm out. I think we're doing very well in the process. For the next four years, you know, we've got incredible visibility not just on, the obviously, our existing clients, but we've got a pipeline of over a 100 clients as well. So we expect to win about six clients a year, early payment clients a year. We've won four this year already.

15:22 So the business is in great, great shape. So going on to Stargo. So it's, it's never a nice thing to have to make people redundant. It's been something that was forced upon us by the termination of the tier one bank contract. Very, very difficult, for everyone involved, but we did have to right size the business, and we did that. So the last twelve months, we've reduced the headcount from around 75 to just just shy of 20 people. So, you know, a very, very big, reduction in the in in the headcount, and the cost basis at Target. It was the right thing to do, but, again, I'd say it's a very difficult thing to do, and for very difficult for everyone involved.

16:09 I mean, the result of that is that despite, as we mentioned earlier, despite the target revenues declining by 50% in the first half, the first half loss actually reduced from 2,700,000 to 1,400,000. So what about the future? Well, we I've mentioned, earlier, we invested in Stargos, because we it is a market leading platform. There's an exceptionally talented team, in Stargos that remains in Stargos, And they've got phenomenal partners, partners that can see the potential within, Citago. And one of our major partners, just signed a new three year contract, with Citago, which again validates what they see, and the value that they see within, within Citago.

16:56 And this slide here shows, the credit control tool subscriber growth and the usage of those subscribers. So and and you can see that's growing 40%, over the last twelve months. So we can see value in Stargos. We know others can see value in Stargos. We've reset the business, reset the cost base, and now we're rebuilding. Right. On to Playstack. So, this is very much Playstack's victory lap. It's been an incredible, first half from, from Playstack driven predominantly by Ballotro and Aviosic Factor. What's interesting, though, is, in July and August, the revenues were mainly driven by Aviosic Factor and, Voidbreaker.

17:48 I know one of the one of the, concerns last year from investors was, oh, you know, what how what are you gonna do post Ballotro? Well, you can see we've, we're publishing, other incredible incredible gains, like AVR Factor and Voidbreaker, which is bringing, increasing the portfolio effect, to the business. We, and it's just worth noting Voidbreaker, returned their invested capital on day one of launch, another exceptional performance from an exceptional game and a very talented developer. We've got a we've got a jam packed 2026. And to put that into context, by the by the end of this year, we'll have, £10,000,000 or slightly more than £10,000,000 of your money, investors' money, out in the world as developer advances. So we as a publisher, we invest, we give developers a certain amount of capital which allows them to, crudely speaking, live, eat, build their game, make it the best it can be with our assistance, and then we publish the game. So those developer advances that we we, we invest in these different games, which is our pipeline, that now at the end of the at the end of this year will be over £10,000,000.

19:05 By the end of next year, we'll be over £16,000,000. So, you can see we're investing heavily, into our into the pipeline of games. And one of the games so we're launching eight games next year. One of the games is Mortal Shell two. And just go and have a look. If you haven't, looked at it on YouTube, go and have a look at it on YouTube. Turn the volume down a bit, otherwise, you'll probably burst your eardrums. It's it's it's trending extremely well on the steam's wish list charts. So it's a game we're we're really excited by. And we we raised did a fundraise in July 2023 for this game. We said it'd be launched in 2026, and it will be. So, yeah, go and have a look at that if you wanna get excited.

19:52 And then it's also worth noting that Sean Brennan, who is on the on the board of PlayStack, he's got a phenomenal track record in gaming. He has joined the board of TRUFIN as of as of the our announcement on Wednesday. So we're really excited to have him on board. So, you've all seen this chart before this graph before. It's firstly, have a look at the the charts on the left hand, the top left. So what these what these graph shows is the return on individual games. And so there's many more many more graphs we could show, but this is just a sample. So, the little purple dot is our invested capital as I mentioned earlier, and we we invest capital in the games, we subsequently, publish.

20:41 So that's our invested capital. And then after that, it's a sort of return on that and oh, you get a return on that invested capital. So when the green line and the green line shows the net revenue of the game. When the green line is above the purple dot, that's when we are making money and we get a return on our invested capital. So, you can see the chart, slight, game three. We haven't yet returned our invested capital because the green line is below the purple dot. And so just taking as a whole, you can see that the the the performance of all the games that we've launched so far inception to date. So since inception, we have a hit ratio, which is a, an American baseball term, which is sort of if you if you go for a ball, you could go for a strike you go go to hit a ball, do you manage to hit it? Yes. In over 90% of the times, we return our and b. We hit the ball. We return our invested capital.

21:41 It's a it's an old term from a from from a previous era, when I was a hedge fund manager. So you you return we we return our invested capital more than 90 percent of the time we when we invest. So, we've been we've launched 13 games, 12 of which have returned their invested capital, which is an extraordinary, extraordinary data point. And then the average return we get on that invested capital is over 300%, and that is excluding Ballotrope, our number one game. So if most of our managers excluded their number one, performing stock or investment, their returns would be, you know, could be might be pretty woeful. If you exclude our number one performing game, our return on invested capital is still over 300%.

22:32 So, an exceptional, an exceptional selection of of stats there for you. And then if you go to the right hand side, you know, again, what about the feature? Well, we've got four games launching this year. The one to really focusing on I mean, they're all gonna be fantastic games. The one we're focusing on is Unbeatable. That's launching on the November 5. That's currently a ninety first on the Steam's wish list chart. So, which is a great position for an indie game to be be on. That's the most wish the chart shows the most wishlisted games in the whole of the world. There are 18,000 launched every year. Ours is currently nine that that game is currently ninety first. Next year, we've got eight games secured. We've announced two of them, Mortal Shell two and Racoin, and we've got six others we're launching which are secured but unannounced.

23:24 So, we will be announcing in due course. And we've also got games we've already secured for 2027, and we're build looking to build that pipeline as well. So very, very, a very, very attractive portfolio games for the future. And all these games, it's worth noting, have been found by the same system that found the last 13 games, which have returned over 300% return on invested capital. So we're using the same process, the same system, the same discipline, that we expect will continue to deliver exceptional returns. So I hope you agree. We're doing really well. We're doing really, really well. We're gonna continue to, underpromise and overdeliver.

24:13 We're growing, grew 42% in the first half. We're delivering more profit per unit of revenue. We're generating cash, and that cash has allowed us to announce our second buyback, our second £4,000,000 buyback, which we've just started. And that buyback is an is despite despite two buybacks now totaling £8,000,000, you know, we're still ahead of cash. We're investing significant amounts of money in PlayStack, and and as you know, we've invested money into Target too. So we're not, hampering the future growth of these businesses in order to buy back shares. We're buying back shares because these businesses are performing so well that they're generating cash, which allows us to buy back shares.

25:00 And we're focused on delivering, exceptional continuing to deliver exceptional returns on invested capital, continue to be disciplined with PlayStack in PlayStack. We're gonna demonstrate continue to demonstrate Oxygen's operational leverage and turns how they're into a profitable business. If we do those three things, we will extract the most value possible from this group for you, our shareholders. So that's our plan for the future. And with that, hopefully, Alex, you're happy for me to open for questions. Would that be? Yes. That's correct, James. So before I hand over to you, could I just please ask investors to please continue to submit their questions using the Q and A tab situated on the right hand corner of your screen. And while James takes a few moments to review those questions submitted today, I would like to remind you that a recording of this presentation, along with a copy of the slides and the published Q and A can be accessed via your investor dashboard. And James, if I may now hand back to you for the Q and A, read out the questions where appropriate, and I'll pick up from you at the end. Thank you. Great. Thanks, Alex. Yeah.

26:04 So, first question, could Balatro be launched on a multi multiplayer platform? I think what that means is a multiplayer could there be more than one player playing Battle Royale on the console? Yes is the answer because you can already play it on console, so I suspect it's the first. Yes. It absolutely could be launched in multiplayer. That will and we work with the developer, Local Funk. We've got a plan for that that game. But, yeah, there's lots of there's lots of areas we could we can move it to. But you'll hear it first from Playstack and local fund. Thank whatever the decision on that game. But, yes, there's there's lots of potential for it for sure. Jake says Jake d, thank you for your good set of results. Thank you, Jake. However, the logic of increasing, PV, not sure what that means, but to shareholders and fixing a buyback price of 91 p for your shares defies logic. Please explain.

27:04 Well, I will explain. So I think what you're referring to is that in our buyback announcement, mentioned, we're buying back shares, 91 p shares. That's just a sort of, administrative number. Don't don't, don't get fixated on that 90 one p. As you can see as you saw yesterday, if you look at our announcement yesterday, we bought roughly a 100,000 shares back at that about £1.70. So we are buying shares above 91 p. We have a we have a cap on the price of prepared to buy shares buy shares, but obviously, it's above, 91 p. So, hopefully, that, answers that question. I mean, and just again, to reassure you, the last £4,000,000 buyback, the average price we paid in ninety seven p. So that that 91 p, I think you just just ignore it, for now.

27:56 Jack says, where should place that EBIT to EBITDA margins be in the next few years? Well, they're going to be growing. We're not gonna we haven't, said where we expect them to to end up, but they're they are growing, and they will continue to grow. We're we're gonna maintain credible cost discipline, which is this that's something that this industry is not renowned for. The gaming industry is not renowned for. And we're gonna continue to launch exceptional games and achieve exceptional returns on invested capital. In that scenario, EBITDA and EBIT margins go up, But we're not gonna be we're not gonna specify exactly where we we see them going. Same, Jack. Again, how do potential cars value businesses like place that? What metrics they're looking at? So potential acquirers. Well, if you are a publisher and you want to acquire if you're a maybe a triple a publisher or another published indie games publisher and you want to acquire, another you wanna grow through acquisition or if you've got a lot of capital, and you're finding it hard to publish games that could get a good return on your invested capital, then, if you look at PlayStack and you look at a business that has, you know, 12 out of 13 games, we think that that ratio is gonna continue.

29:15 So if you find some a business that has a a system a systematic way of finding and returning, of investing and returning exceptional returns on investment, then that's a business that I would wanna own if I was the CEO of a publishing business and I wanted to, to grow through acquisition. Or I had tremendous amount of capital that I wanted to deploy because these sorts of returns are exceptional. So, I think, and we think that acquirers will value the business in three years. One, if we look at the back catalog. So next year, roughly 50% of all the revenues will be from back catalog. That's business that's that's games that we've done the work for, where the money just comes in.

30:01 And then I think they'll value that, then they'll value the engine of growth, which is the engine that we've been using to source these investment opportunities or these, and the publishing team, exceptional publishing team that is at place that place that one indie game publisher of the year last year in The UK. So we are the number one. It's not me who said it. It's in UK, you said it. We're the number one, UK publisher in The UK. So they will value that engine of growth, that publishing team, and then they'll also value the pipeline of games that we've already secured for the future. So that's how we we think this business can be looked at in that way. Hopefully, then they'll look at the metrics they'll look at, they'll look at return on invested capital, they'll look at IRRs, they'll look at the back catalog, how it's performing, they'll look at the future pipeline, how much money we invested, the types of games we invested in.

30:51 So those are the sorts of things that, that they'll be looking at. Gosh, Jack, another question. Can you make the buyback even bigger? The cash balance will still be nice after this buyback's complete, and the stock is very cheap. Thank you for your hard work. Well, thank you for that, Jack. Yes. Of course, we can make the buyback bigger, but we feel, you know, there's a lot of there are a lot of investment opportunities. You know, again, when you're getting, 300% returns in your invested capital, you, you know, that's something it's it's hard not to allocate towards that. So we, as a board, felt, this amount was the appropriate amount. As you know, we had a £4,000,000 buyback earlier this year, which completed by the end of August. There's another £4,000,000 buyback. I'm not sure how much more you want, Jack, but, yeah, we're we're as you can tell, we're constantly assessing, the right amount of money to to buy back, but we feel this is appropriate for now.

31:50 Mark, how do you propose to improve the revenue decline as a result of tier one bank contract termination? Well, Mark, good question. But now that the so the tier one bank termination was in July last year. I think was when I was in Cornwall, actually ruined my holiday. So that is the first half. So the first half comp first half was the difficult comp versus first half this year. So that difficult comp is no longer there, which is good. So, you know, the sort of revenue declines you've seen in the past won't occur in the future, because you won't have the difficult comp. And then now it's about focusing on what's working as you can as you saw earlier.

32:36 The software side is is growing exceptionally well. We're winning new contracts elsewhere, and it's about winning with our partners, with our we've got very, very substantial partners and ensuring they're successful. If they're successful, then we'll be successful. So that's what we're that's what we're focused on. Vishal Vishal says hello, Vishal. Sean comes with a solid background on what has been the impact he has made, albeit it's early days. Additionally, as you got a holding TRUFIN PLC, was he primarily incentivized on PlayStop performance? He is, sorry. It's it's moving around. He has got a fantastic background. He's a fantastic individual. He I know he's been a great help to to Harvey, and they work very well together. He's been a great help to me. He's been a great help to our board.

33:27 And although we have Penny John on the board, he's also on the board of Everplay, who has got deep knowledge of of that sector, Sean has got real hands on experience. So he is, he has made an impact. He's and he's gonna be helping guide us as as as PlayStop is is now a very significant part of TRUFIN. It's important that we have that deep knowledge at TRUFIN level as well as at the PlayStop level. I I don't believe I don't I I don't quote me on this. I'll get back to you, Shar. I don't believe he's got a hold in TRUFIN PLC, but there are there are there is plan in place to incentivize him at the TRUFIN level because there's conflicts as you can imagine otherwise. So that's something that we'll be we'll be we'll be making some form of announcement on.

34:20 But, yeah, he's very much gonna be a you know, we're really excited to have him on board. We're very sad to see Paul go. He's been an incredible addition to the board. Paul Dentskovich, a great assistance to me and to the whole board. But we feel Sean is gonna be, really a really value add when it comes to PlayStack, going forward. David says, can I ask about oxygen incremental margin? Looks particularly high. This half was strong for your results, 24. How do you think about this and what EBIT EBITDA margins could be going forwards? So there's a lot of questions here, so I'll just answer them quickly. That is and we do thank you very much. Yes. We do see oxygen's EBIT and EBITDA margins growing.

35:05 We've said to people, you know, think of the as a mature EBITDA margin of oxygen, at a mature state, which is many years in the, out in the in the future at sort of circa 50%. So that's where you expect that business to go. On PlayStack, do you disclose how the revenues again, all these questions from David. On PlaySlack, do you disclose how the revenues are split between you and the game developer? Really trying to work out the difference in gross and net revenue. Well, we don't on each individual contract for lots of sensitive reasons, but just the industry works like this, David. A £100 of revenue, most, game publisher contracts are $60.14 favored developer after the invested capital is returned.

35:52 Usually, it's $50.50 on platform deals. So where the publisher gets a large contract with Xbox or Game Pass or PlayStation or Apple, whatever it is, that's usually split fifty fifty. So that's roughly where where the the market is, and all those numbers are every contract is different. So I hope that gives you a sort of feel on for that. So, Tago, what's the motivation to buy this out? Is it on the strength of the Sage deal, or is it their potential to sign bigger bank deals? Wondering why someone would sell if there was a big deal in the pipeline. No one sold no one sold their shares. They just didn't participate in the the tier one bank did not participate in the, in the new funding round, they didn't sell.

36:37 Just note that. And our motivation, to, fund this is it was part of our cash flow forecasting this year that we would fund it. We see, as we said earlier, we see there's a lot of potential at Stargo, and we and others, see the potential at Stargo. And, yes, we've had to go through this, you know, this this very unpleasant restructuring, forever involved, but we do see, we do see real potential at Stargos. Bridge twenty six, thinking mainly about plays out. Do we know the number of games to be released? Yes. Eight. You should be listening, David. Oh, an idea of what Mortal Shell might do. We said at the at the fund fundraise, when we raised money for Mortal Shell two, the rough figures of of we sold 1,000,000 units of Mortal Shell one, at $20.

37:33 That was a game built by four people. It was eight hours long. So eight hours long game cost $20. A million people played it. No one had ever heard about Mortal Shell before. Mortal Shell two, where we now have a very loyal cost following. Mortal Shell two, we said we expect to do a circa one and a half million years. The first game is eight hours. This game is gonna be thirty hours, in excess of thirty hours, so the price point will be higher at the time we said the game would would price around $40. So $1,500,000 for so one and a half million units at $40 is what you should be thinking. But that hasn't changed since two year eighteen months ago. And, well, our confidence level in that has grown since then, because now we're well into the development phase.

38:22 So, hopefully, that gives you a a feel for Mortal Shell two. New buyer, can you give me color on capital allocation and decision to buy back more given the already sizable return state? Yes. We have excess capital. We we feel, the shares, of TRUFIN are undervalued. Otherwise, we wouldn't be buying them back. And we are as you as you as I mentioned earlier, we are investing heavily in PlayStack, in in Citago. Well, Oxygen's returning capital to us now. PlayStack, we've, we have £10,000,000 invested in external developments by end of this year, 16 by the end of next year, and that's despite $10,000,000 coming back to PlayStack as as once Mortal Shell launches the first 10,000,000 well, there's a slight split of it. Think of it as the first $10,000,000 comes back to PlayStack. So there's been an awful lot of capital coming cash coming back to PlaySac, and yet we're investing heavily, in in that. And despite, you know, our our cash flow forecasting for the next twenty four months shows that we have the excess capacity and the ability to buy back shares. So we think it's the right thing to do with our capital.

39:34 And, Nigel, I'm concerned about Stargo. What was the cost of increasing the equity investment I assume from Lloyd's, and what valuation does this imply for Stargo's day? We're not gonna say, Nigel. I can see why you might be concerned because of the short term, revenue decline, but we, yeah. You've gotta, you know, you've gotta you've gotta trust us that we know what we're doing. And, we have we're not gonna say how much extra equity we put into the business. And, no, we didn't buy the shares from Lloyd's. We, we just sorry. As you mentioned, Lloyd's, we didn't buy the shares from the tier one bank. We just put money in, and then they didn't, and they got diluted as a result.

40:21 And what valuation does that imply? That's not something we're gonna talk about. It's not public information. Vishal says the overall gaming sector, hello again, Vishal, is coming back to life. One of views driving that. In addition, it's likely consideration activity accelerates given the backdrop will place our retains organic focus, and how does the company protect itself from opportunistic activity? Well, going back to front, you know, we're we're not here to protect ourselves from opportunity activity. If someone wants to come and buy, PlayStack, you know what? As we've always said, and it's on TRUFIN's website, we buy businesses that are unprofitable or profitable. We look to grow them, and then we sell them. And that's what we're gonna do. And what you know, that's one of the options. There are other options, but that is, you know, very clear, and that that basically means we're open for business. And we we we've we we've very, very clear about that. So we we're not trying to protect us. What we're trying to do is build the best business that we possibly can, and that's what Harvey and his team are doing at PlayStack. That's their focus. Not not distracting them with with other with other sort of options. We in terms of in terms of organic focus, yes, we are growing organically, as you can tell, fast. We are also looking and exploring.

41:41 There are lot have been and will be lots of, you know, small incremental, potential, acquisitions. We made one in the form of Magic Fuel a few years ago, where it makes an awful lot of strategic sense or there's, there's there's really good financial rationale, we will we might look to make that sort of acquisition. We're not in discussions with anyone meaningfully meaningfully right now in terms of us acquiring, another business, but that's something we could absolutely might do. And and back to your original the first point about, what's driving, the the overall gaming sector. Well, post COVID, during COVID, there was an a glut. There was there was everyone's at home gaming, and and if you remember back then and, of doing other things, but gaming was one of the things that they people were doing.

42:34 So there was a a sort of a super return, a super normal return on gaming companies at that time. That money, I would say, a lot of it was invested very unwisely. There was a glut of money at Russia Capital, go and build all these other games that launched that maybe should never have been built. That and there was also a big hiring spree that went on during and post COVID. Obviously, what happened then is everyone goes back to normal, returns to normal, game set returns back to its its long term upward trend, but nevertheless, the the the blip is, sort of, smoothed out. So, these companies then overextend themselves, maybe built games they shouldn't have built. There was a there was an enormous number of games that came to the market in '24, '23 and '24.

43:25 And because game there's a game cycle, you wanna build a game now. It doesn't launch tomorrow. It launches in two or three or four years' time. So a lot of that capital, which maybe went into games that should not have been built, many of those games have been released. And you just test just go and find out how many people have been sadly made redundant in this space. So a lot a lot of the the companies that were profits warning because their cost basis weren't performing, they've significantly reduced their cost base. They've made they've now got back to a more disciplined approach, and that is as a result, that's driving, you know, profit upgrades rather than profit downgrades. And, in that world, that's a that's a world where, you know, the the investors wanna see. So that's what's happened in the industry, and we've come out the other side now, and that's why the evaluations are rising. We've got a a much more sustainable level, number the number of businesses that are out there that have survived this sort of cull are in a much better state than they were, post COVID.

44:29 And that's why this industry is the industry is improving and valuations are improving. Fraser says, what's the expected revenue range for games in 2026? I can't possibly say, Fraser, but, because I'm allowed to. But, you know, as you as you can tell, games that you might not think could do exceptionally, well, you know, every game is the has the ability to be a ballet show or more, and that's what's exciting about this industry. And to do that, you don't need to invest more in the best capital. You don't need to build a new factory. You don't need to hire anyone else. The game launches and then it's then it's in the big bad world and, virality takes over, you know, obviously, there's marketing, etcetera, that helps that. But, so the range is unlimited upside.

45:20 We have obviously, that's not how we think about our business, sadly. Well, we're more cautious in terms of our expectations for those games, but the upside is unlimited. And we've got we set as I said, about 50% of our revenue next year will be from the back book, and then the other half will be from the new eight games launched, next year. So we've got modest expectations for those games, but we have, you know, internally, we've got very high hopes for the games as well. But, again, trying to be trying to under promise and over deliver. Rob says, could James explain the advantages to TRUFIN PLC if it's free to consumers? Well, yeah, the advantages, that we have an incredibly loyal customer base in Bellatro.

46:09 And what we we want to do and local funds that available wants to, more importantly, because we're assisting him, is to make Ballotrope the best game it possibly can be and to ensure that users get the best possible experience. Whether you bought it today on Steam or Apple, you will have the best version of Ballotrope for the rest of your life. The the branch doing that, yep, maybe short term, maybe we can make more money by, you know, doing Ballotrope two or something of DLC. But the advantage is the loyalty on this user base is exceptional. The community is exceptional. The goodwill will be incredible. People will play the game more, tell them show it to their friends. They will create there will be financial benefits for doing that as well.

46:54 And, yes, as clearly, short term, there may be ways to make more money from Boutotrop, but we are working hand in hand with the developer who's absolutely focused, and I admire him for this. He's focused on making sure everyone who's bought Boutotrop has the best version of Boutotrop at their fingertips. And it's that sort of attitude that brings an, incredible loyalty, which is something that, is very special about that game. Vishal, hello again. On auction, previously, you have passed away office for business as they were not at the level the board felt reflected the value of the group. Is that still the eventual exit plan for auction given its cash generative nature? So we've we've said many times in many different announcements that we'll we are looking to realize value for our shareholders. That remains the case. Oxygen is an exceptional business.

47:48 Every year that goes by and every year the EBITDA goes up, the business becomes more valuable. Not just obviously as a the the people want to buy bigger businesses. There's more private equity businesses trying to buy a business with 5 to 10,000,000 EBITDA than 0 to 1,000,000 EBITDA. And so if you've got more competition, the rating goes up. Very simple. So we are open for business. That said, we are focused, PlayStack on developing and building the best business possible and showcasing that business, to people via the the various press releases we do on on oxygen. The we have a whole list of people that are interested in oxygen, and we're gonna keep them informed. But, as I said once before, which our business is the best you get the best price when it's on vital business, not when you're trying to sell your business. So, we, we are it is cash generative. It is returning money to the to the group. The group is therefore able to do, buybacks as we've announced again today.

48:52 But at some point, this business, people will realize the value the true value of this business, and, offer us the right the right price for it. And we'll be coming to you and asking you what you think when when they do. Nigel, do you perform peer group valuation analysis on PlayStack versus competitors such as, Frontier Development? Appreciating PlayStack is an indie game developer. We do we absolutely do go our own internal analysis of, of, PlayStack relative to, others. We don't compare ourselves to Frontier. It's a very different business model. But if we look at the financials and look at the, yeah, EBITDA margin, look at look at the return on invested capital that we achieve, etcetera, Nigel, and you'll see that not comparing us to Frontier Development or Ever Ever Play or anyone, but we are we're doing you know, we're very, very pleased with our performance, and that we know there's a lot more to do. So we focus on ourselves and doing the best we possibly can producing the most enjoyable games for gamers worldwide.

49:53 And we do that, then the evaluation analysis, etcetera, will take care of itself. But, yes, we do, obviously. We follow these these the the other the other companies closely. Vishal says a tough year for Targo. Can you shed light on the morale within the group and new business pipeline? Yeah. It has been a tough year for Stargro, and the end of last year was also tough. You know, from the day we lost the tier one or the tier one bank, the contract was terminated. It was it was tough. Yeah. No one if you've ever been in a business where there has been significant headcount costs, that is not, the morale of that business is never better than a business than a business that's growing. So it's clearly there's no point in me sugarcoating it. It's not the morale, the morale has at times has been has been lower than we would like it to be.

50:48 And but, clearly, you know, for those who are no longer part of Stargo, it's even worse. So, you know, let's not feel sorry for ourselves, for for those remaining. And now at least we're at a point where we've done we've done you know, we've we've made the very difficult decisions. We've rightsized the business very quickly. It's not that there's no more, you know, there's no more cuts coming. That's it. We we are the group here is is the group going forward. And that's, I think, a very I know, myself having what you know, I was younger. Working in an organization that has right size is is a you know, you when you're you're you're one of the remaining ones, that's a very that's a much better place than be to be than having a guilty hanging over your head, worrying that there might need to be, more redundancy. So we made drastic decisions. It was the right thing to do, and that allows the the the group to rebuild. And, yes, there is a very healthy new business pipeline.

51:45 Yeah. So we're we're we're yeah. There's lots to do, but we're excited about the future for for Stargro. Michael says, how long do you anticipate until either or list as a pure play to achieve full valuation? Oh, thank you, Michael. Look. I don't anticipate. I mean, we never said either of them would be listed as a pure play to achieve full valuation. There's an awful lot of, benefits to the businesses in the past, being sheltered within within TRUFIN. But, yes, both of them are getting to a point where if shareholders are not my company, it's it's your you are the shareholders of the company. It's the shop to the shareholders to decide the future of oxygen play stack.

52:36 But, you know, clearly, you could look look from the numbers. You know, these businesses are doing, you know, exceptionally well. So that's obviously always an option, but that that that's something that is up up ultimately up to our shareholders. Michael. Sorry. So we missed it. Yeah. No. Another question from another Michael. Auctions reaching a point where it can become very attractive PE funds on the basis the price was right. Would you consider divesting the auction? It yes. I think I'd say it is already very attractive to PE funds. And based the price is right, would you consider divesting? Absolutely. I think that's clear. Nigel, how is the GFCH partnership progressing with Targo? The partnership is progressing. Well, thank you.

53:23 Lots to do still as as always with all partnerships. And it by no means is the, DFC is an exceptional business. That's just little little nod to Carl, the CEO there, and what he's built in in DFC. There's obviously also lots of other other banks that we're, progressing and talking with. We've a small team now. Lots to do. Yeah. But the the the, the partnerships, between Target and and all its partners, are progressing well. Thank you very much, Nigel. That's great. James, if I may just jump back in there and thank you for addressing all those questions from investors today. And, of course, the company can review your questions submitted today, and we will publish those responses on the Investor Me company platform.

54:08 But James, before I redirect investors to provide you with their feedback, which I know is particularly important to the company, could I please just ask you for a few closing comments? Yes. Thanks, Alex. Well, I think to summarize what I've already said, which is we had an exceptional we had a great year last year. We've had an exceptional first half this year, Wonderful start to the second half. We're in a we've got a very strong balance sheet, hence, the the the buyback. We're investing aggressively in the businesses to to we're not compromising them, in any way. And, yeah, the fact that we're buying back shares hopefully gives you some indication of where we see the value, in the business.

54:55 Hopefully, that's and I look forward to to doing this again. Thank you for hosting the site. Fantastic. Thank you very much, James. Thank you for update updating investors today. Could I please ask investors not to close this session as you know 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 TRUFIN PLC, we would like to thank you for attending today's presentation, and good morning to you all.