Welcome to the Cerillion FY 2024 results webinar. All attendees are in listen-only mode, and at the end of the presentation, there will be the opportunity to ask questions. At any stage, please type your question using the Q&A button. This webinar is being recorded. I now hand over to Louis Hall, Co-founder and CEO, and Andrew Dickson, CFO. Louis, over to you. Hi, Tamsin. We can't actually see who's logged in. Is it possible for us to see who we're talking to? I'm afraid you can't because you're on a separate login. But I can tell you you've got 40 people so far. Yeah, it would just have been good to know the names. Anyway, not a problem. I can send it through to you. All right. Good afternoon, everyone. A little strange speaking into a completely disembodied world, but we'll give it a go. Thank you for joining the webinar. I'm Louis Hall, CEO of Cerillion, founded it back in 1999. I presume at least a number of you have met us before and heard the story, whoever you are. For the benefit of those who haven't met us and don't know the story, I will give some background to who we are and what Cerillion does. As I said, I founded the company back in 1999, in the middle of the dot-com boom, as it was then, as an MBO from a large U.K. software house called Logica, which no longer exists in its own right, but was quite a force in the software world in its day. We went out into the market, raised private equity funding, built a customer base, rebuilt the product sets a number of times, and eventually IPO'd in 2016. Since then, we've carried on building the business and gradually built business with bigger and bigger customers and gained momentum, and we are where we are today. Given the interest of time, I appreciate we haven't got a lot of time to cover quite a lot of ground. I'll just do a quick introduction for Andrew. Andrew's been with us since, I think, nearly three years in January and replaced the sort of founding stage CFO. He retired three years ago, coming up in January. Moving rapidly on, before we go into the highlights of the period, in terms of what we do, so we provide what we call variously CRM and billing software, or BSS and OSS software for those familiar with telecoms acronyms, to telcos globally. In terms of what that, so what does that actually mean? The software we provide essentially connects telcos' network infrastructure, so their investments in mobile networks, base stations, antenna, fiber cable, all of that stuff, whether it's fixed mobile, broadband, TV, whatever, to their end customers. The glue in the middle that enables telcos to monetize their network infrastructure is the software that we provide. And that covers everything from defining the products that telcos sell to their end customers through to onboarding of those customers, whether it's through CRM, through call centers, or through retail outlets, or through digital customer experience, so where customers are serving themselves online, through mobile apps, and so on. Once those products have been sold and those customers have been onboarded, our software then connects those customer services to the network. Our software then manages those customers' usage of those services through our real-time charging platform, maintains balances, authorizes calls being made or online sessions being started, and so on. And once we get to the end of the billing period, our software will generate bills and dispatch those electronically or in whatever form customer preference is. And then, of course, once the bills have been received, we handle the receivables. What happens when people don't pay? Credit control, etc., etc. So a very broad range of software, which is right fundamentally at the heart of how telcos run their businesses. So it's not nice to have. It's absolutely critical to any telco being in business. And we deliver this through a suite of modules, different modules addressing different parts of that functional space. And we do this against a completely industry-standard backdrop of defined domains. And as you can see from the diagram, our modules, which are the boxes, cover all of the domains that what we call the BSS, OSS space encapsulates. And what I mean by that is what I've just described. That's essentially what we mean by BSS, OSS, or business support and operational support systems for telco. When we do that, I guess fairly uniquely, on an as-a-service basis. So this means that all of our customers receive the same software. So we don't start with a sort of product framework or a previous implementation and then go and customize to order that particular version for the next customer. We supply the standard product out of the box to every new customer. And without changing codes, we then configure that solution for the customer to input their products, their tariffs, their business process workflows, their credit control processes. Everything you can think of that will be involved in running that telco's business is configured, not hard-coded. And that's a key differentiator between us and the other main players in the market. And of course, because the product we have is out of the box and works on day one, there's a massive reduction in terms of long-term cost of ownership, in terms of how fast it takes to implement the solution, so time to market. And also because all customers share the same product, it's much more flexible in terms of implementing upgrades on a regular basis going forward. And indeed, customers on our Evergreen program can receive upgrades twice a year, which may sound like a long time compared to your iPhone updating itself. But in our industry, that's quite incredible. Where typically, platforms will only be upgraded once every five years. So it means that all of our customers have the potential to benefit from all of the R&D we do, which is quite extensive. Okay, in terms of geographical coverage, as I said, we sell to telcos all over the world. We have around 80 different customer installations in 45 different countries at the last count. And telecoms, one of the great things about telecoms is it is a truly global business. The software that we sell in the UK is the same as the software we sell in North America, in Asia, in Australia, and so on. All of these telcos around the world are working to the same industry standards. That obviously means that we have a truly global market. In terms of how that typically breaks out, around 55% of our software this year, last financial year, 56% is, sorry, of our revenue is in software. A bit less than half of it is in services. The services are typically implementation services to put our software live, which will involve quite large projects to understand the detailed requirements of our telco customer in terms of the things I mentioned earlier, the products they want to sell, which can be incredibly complex in many cases, and how they want to do that, how they want to engage with the customer, and so on and so on. Quite a lot of services involved still, but we're predominantly a software business. A lot of our business is in Europe. Europe's probably the most dynamic telco environment in the world. There are all kinds of different telcos in Europe. There's just a lot more different countries with different regulatory environments that require different independent telcos. That's a rich environment for us. We also still have business in the other geographies. Often you'll find that some of these other geographies are more active than others. But Europe is always around half or more of our business. Another key fact about Cerillion is that a lot of our customers have been with us for more than five years. Most of our customers have been with us for more than five years. Some of our customers have been with us for 20 years. It's a very sticky customer base. It's quite rare for us to lose a customer. Once we've won them a quite long sales process, it's typically 9 months to 12 months, maybe even a little bit longer. We keep them for a long time. Another key fact is that a lot of our revenue does come from the existing base. This year, it was 85%, but it's often in the high 90s. So just demonstrates how important that base is and how productive it can be. In terms of our main operating bases, we have around 360 people at the moment. HQ in London, we have about 120 in India, the main office in Pune, and satellite offices in Indore and Ahmedabad. We have about 210 or 220 people at the moment. We have an operation in Bulgaria and Sofia, where we have about 30 people, but we've recently moved to a new office there and are looking to grow that to 100 or so quite quickly. We also have sales presence in North America, in Brussels, in Sofia as well now, in India, in Singapore, and in Sydney. So quite a broad, widespread of sales presence geographically. And now what I'll do is I'm going to go back to that's an overview of what we do and where we are, how we do it. I'll give a quick run through a couple of highlights, then I'll hand over to Andrew to go through the results from Financial 2024. So first off, we're really pleased to have achieved new highs against all the key financial KPIs, particularly adjusted PBT up 18%. Again, Andrew will go into more detail. But we're particularly pleased that our new orders total was up 21% to £ 38 million, £ 38.1 million. Obviously, that's important for Financial 2025, that we achieved a reasonable hike in sales in 2024. Underpinning that were two major new logo wins. The win with Virgin Media in Ireland that we announced back in November last year, a significant new signing for us, a Tier 1 player, where we're doing absolutely everything in that territory: mobile, fixed, broadband, B2C, B2B, etc., and we're replacing a strong competitor in the market, but one of the traditional competitors that will typically deliver a much more tailored, bespoke solution, and that was essentially a logo win where there was a desire to go to a more cost-effective solution that was more modern in terms of it was SaaS-based rather than bespoke-based and much more flexible in terms of ability for the customer to introduce new products to the market without vendor intervention, to change configuration without code having to be changed. The second new logo win in Southern Africa that we announced back in May is with quite a different kind of business, less mature, but very much kind of up-and-coming and growing, providing a very broad range of connectivity across seven countries in Southern Africa. So not just South Africa and Namibia and so on, but also going through Botswana all the way up to Angola. So a very broad geography, lots of space for them to expand into with their existing fiber and satellite businesses, but they've now invested in 5G mobile. That was a trigger for bringing in Cerillion because this was a kind of growth-based driver where they were investing heavily in new mobile 5G network, needed a new platform to support that, but also one that could combine all the other services that they were providing, all the other connectivity they were providing on the same platform. So that was a reason for selection there. And I think even though we took out deals, we took out value from the pipeline, the sales pipeline by winning deals, we also saw that new order pipeline, new logo pipeline grow 8% again to a new record, £ 262 million. So I think in general, we feel that we're well positioned for 25 and very confident about the year ahead. So I'll just hand over to Andrew now. He'll talk to the details, talk to the KPIs with some more detail. Thank you very much, Louis. So as Louis has said, overall, 2024 was another very strong year for Cerillion, with most of our KPIs at record levels. We saw continued revenue growth, high margins, and further build in net cash. As you can see from the graph at the top left-hand corner, over the past few years, we have demonstrated continued strong revenue growth, with revenue growing on a compound annual growth rate since 2019 at 18%. In 2024, revenue grew by 14% on a constant currency basis to £43.8 million. At the same time, adjusted PBT increased by 18%, up to £19.8 million. This reflected strong operating leverage from a high level of license revenue dropping all the way through to profit, as well as improved operational efficiencies and continued focus on cost control. You can see the graph at the top right-hand corner. Over the past few years, we have performed very strongly in terms of cash conversion as well. So cash was up by 21% to £ 29.9 million. And I'll talk about cash in a bit more detail later on. In terms of recurring revenue, recurring revenue increased up to £ 15.5 million. And again, the compound annual growth rate since 2019 has increased by 24% each year. So over time, recurring revenue has been growing at a faster rate than total revenue. And therefore, Cerillion has been becoming a better quality business. There are three main factors going into recurring revenue. First of all, we've got support and maintenance revenue. We've got managed service, as well as recurring third-party hosting and hardware revenue as well. The graph at the bottom left-hand corner shows the back order. So the back order grew slightly up to £ 46.9 million. That number is made up of two components. First of all, £ 37.7 million of orders that have been contracted, and we estimate that around 45% of that balance will be recognized as revenue by the end of financial year 25. On top of that, we've got £ 9.2 million of annualized support and maintenance revenue, and therefore, we have a decent level of coverage looking into financial year 25. At the same time, the graph in the very middle shows the new customer sales pipeline, so the new customer opportunities are up by 8% to £ 262 million. We think there's a very healthy value of opportunities to go after, and hence, we believe we are well positioned to continue to deliver future growth. As Louis said, new orders were up by 21% in the year to £ 38.1 million. And that included the impact of two new customer wins during the course of the year. Finally, on this slide, dividend per share at the bottom right-hand corner, we have a continued progressive dividend policy with the dividend per share up to £ 13.2. Okay, over the slide to the financial highlights, we can see that revenue grew up to £ 43.8 million. And that was driven by growth in both software revenue, which was driven by higher support and maintenance revenue, as well as higher license revenue, and also services, which was driven by implementations for a number of existing customers. You can see that there was a good increase in the gross margin, with the margin increasing by 1.8 percentage points to 80.5%. This was due to two main factors. First of all, a continued high proportion of license revenue. As you know, a higher proportion of license revenue means that the incremental revenue drops all the way through to profit. Hence, that helps to increase the margin overall. On top of that, we did see an increase in operational efficiencies as well, which was mainly due to an improvement in the services day rate on key implementation projects. You can see that the adjusted EBITDA margin remained very high at 47.4%. This included the factors I just talked about going into the gross margin, as well as a good focus on cost control. During the course of the year, we increased headcount in all of our main regions of the UK, India, and Bulgaria. But by continuing to recruit strongly in India and Bulgaria, where the costs are a lot lower per head, we actually managed to broadly maintain the average cost per head in line with the prior year. Okay, over the slide, we'll look at cash performance in a bit more detail. We've lost control of the slides for some reason. Oh, okay. Okay, so the table at the top shows a reconciliation of adjusted EBITDA down to free cash flow. You can see that during the course of the year, there was further build in working capital, which is broadly in line with the prior year. Just to reiterate, the increase we saw in the prior year was fully attributable to an increase in accrued income, which was linked to the high proportion of license revenue that we recognized. But the £ 6.1 million of working capital that was increased in 2024, about half of that was due to accrued income, and the rest of it was due to the timing of receivables and payables. The graph at the bottom shows a reconciliation of opening net cash to closing net cash. I think the key point there is that the free cash flow of £ 9.7 million was significantly higher than the amount we paid out in dividends and lease payments. Hence, the closing net cash balance of £ 29.9 million. Over the slide to the detailed income statement, there's really four additional points to mention here. First of all, is that we continue to invest in research and development. So during the course of the year, we invested around 13,000 days into R&D, which was up by 17% on the prior year. In the year, we capitalized £ 1.3 million of development costs, which made up around 65% of the total spend. Secondly, as you can see, operating expenses increased by 8%. This included further investment in heads, as well as inflation and also some impact from unfavorable FX due to strengthening of sterling over the period. You can see that the depreciation and amortization balance fell by £ 500,000. This was mainly due to the non-repeat of amortization of acquired intangibles from the prior year. So this balance became fully amortized in the prior year as we flagged this time last year. And hence, the £ 500,000 amortization charge was not repeated in 2024. We are flagging that in 2025, we do expect this balance to increase again by £500,000 or increase by £500,000 due to the impact of a new lease that we have signed in Bulgaria, whereas previously we were operating through a WeWork type arrangement. But in September, we moved into a new facility. And we were also expecting to sign a lease renewal on our office in India as well. Finally, on this slide, you can see there was an increase in the effective tax rate. That increased from 19%, 19.7%, up to 22.5%. And that was mainly driven by the increase in the U.K. corporation tax rate from 19%- 25% in April 2023. So hence, in financial year 2024, we got a full year impact of that higher tax rate. Okay, I think the key point in terms of the balance sheet is the balance sheet continues to remain very, very strong. You can see net cash at £29.9 million. And there was an increase in net assets over the year of 31%. As I said, there has been some increase in accrued income over the year. So accrued income has gone up by £3 million. But this should lead to greater cash collection in future years. And finally, the consolidated detailed cash flow statement, really just here for reference. This is more of an appendix slide because I think the key points have already been mentioned on the previous summary slide. Thank you, Andrew. Right, oops. Okay, so conscious of time, so just a few points on operations. So during the year, we're very pleased to have completed two big implementations we've been working on from the previous year. We finally finished the second phase of the project with Telesur in Suriname to migrate all of their fixed wire base, having previously migrated all of the mobile base across to Cerillion. This is, think of Telesur as, I guess, the BT as it was, the main telecom provider of everything in Suriname. It is a relatively small country, but Telesur has to do everything that France Télécom would do or BT or whatever. That was quite a complex project. This is a good customer for us going forward. Also, a really small country, Seychelles. We completed in one shot, in one single phase, the migration of everything in the Seychelles. Again, CWS is the old Cable & Wireless Seychelles. Essentially, they're very similar to Telesur. They They provide all the services to all the customers pretty much in the islands. And obviously, a lot of high-value tourist business and so on. So quite a complex project. And that one also we completed back in May. So that was an important project completion for us. And the new projects that we're working on with the new logo wins with Virgin Media are progressing very well, as is the project in Southern Africa. So with Virgin Media, we're expecting to have that customer live in the first quarter of next year. And we've already done most of what we need to do. But because this is a Tier 1 customer, there's a bigger program around us that we're now waiting on for final completion and to go live. The customer in Southern Africa, we only signed in May, but we expect to go live in March next year. So they're very much in a hurry. And that obviously helps a lot in terms of our ability to implement quickly. Just a few words on R&D. So we spent 13,000 man days on R&D in 2024, financial 24, an increase over 2023, where we spent 11,000 days. So to put it in context, that's the equivalent of about 60 people full-time just doing R&D during the year. And one of the key things we introduced, which came in with our 24.2 release in October, is a new Composable Customer Self-Service module. So this is all about what we call digital customer experience. And it's a big thing in the industry right now. So telcos are very focused on getting customers to work through digital channels. And I guess for two reasons. One is that the more customers they can take away from call centers and from retail outlets means more cost savings. But also, increasingly, having a very slick digital channel. So that means self-care, online self-service, and mobile apps increasingly. It's important in terms of not just winning customers, because if a customer has a smooth digital experience on your website, they're more likely to sign up with you as opposed to the next competitor's website. But also in terms of churn, reducing churn. So when a customer needs something, if it's easy to solve that problem via the online channel, then you're more likely to retain that customer. So it's a big issue for telcos right now. And one of the challenges that we have as a product supplier is that it's one of those areas where telcos do think they need a specialist customized solution. With our strategy of only providing the same product to all customers, that was proving a bit of a challenge. What we've now created is essentially a studio environment where customers can compose their own self-service. With the previous incarnation of this, customers could change the colors on the screens, the graphics, the fonts. They could move things around on screens. They created a very different looking environment, but essentially, the structure of the interaction, the flow through the sales process, and so on was pretty fixed. Whereas now, customers can, in a kind of graphical user interface environment, change the flow, change the structure completely, bring in third-party feeds and third-party cards, as we call them, or, essentially, windows into other platforms that can then be configured to do different things. A hugely more flexible environment that does enable telcos to take a standard product, which is a massive cost saving, and create their own unique digital environment from that in that product environment. This is something which telcos often spend millions and millions of dollars on to create their own very unique environments. But because they're not using products to build a standard environment, they're using specialist web, website creators, and so on. That's a hugely expensive undertaking, not just to create the thing in the first place, but to keep it up to date and to change it when new products come to market or new ways of approaching the market evolve. This has had a lot of very positive feedback from our customers. I think this is a really important thing for us to have launched in, well, at the start of our financial 25. In terms of just to wrap up the presentation part and hand over to the floor for questions, I mean, as I said at the beginning, we're very pleased. Our total new orders are up 21%, giving us £ 38 million of new orders to work on, not just last year, but into this year as well. We just talked about the back order. We've spoken also about the strong and growing pipeline. I think in general, just a quick word on the trading environment. I think that to the extent that there's a squeeze on CapEx and telco, and there's quite a lot in the press about this. Certainly, we're seeing telcos under cost pressure. The fact that we are the solution that reduces total cost of ownership, that is more efficient to maintain going forward, that enables consolidation of multiple bases onto a single platform, that actually works in our favor to a large extent. So the deal we won with Virgin Media, as I was saying earlier, is a result of that driver in the market. So we don't just win when there's lots of investment, as in the Southern Africa case, new investment going in. We also win when there's a need to consolidate and reduce costs. And as Andrew said, we have a strong balance sheet, strong cash flow, increasingly higher recurring revenue. So all in all, in summary, we feel pretty well positioned for the future, whatever it may bring in this somewhat uncertain world. And with that, I think it's over to Tim or Tamsin with the questions. Tremendous, Louis. Thank you very much indeed. So if you have a question, click on the Q&A button and please type your question in. We're not taking any verbal questions today. Your new business pipeline stands at £ 262 million. That's a very significant level of new business. What's the shelf life like, so to speak, of the individual opportunities? It's a good question. So they are quite long sales cycles in telco. And I think as I've said earlier, six months will be quick. Nine months is more normal. Twelve months sometimes will stretch to twelve months, sometimes even longer. And so the shelf life in the pipeline depends on how fast that process is. We don't keep opportunities in the pipeline indefinitely. So if there's a big delay and a telco says, "Well, okay, we're not going to look at this now this year. We're going to look at this next year and wait for a new budget," then we take it out of the pipeline. But opportunities can be in that pipeline for easily 12, sometimes 18 months. Great. Thank you very much. And is the sales pipeline qualified leads? And if so, what percentage historically convert to sales? So the sales pipeline does, although it's not an exact science, there is a lot of structure. So opportunities only come into the pipeline if they're what we call sales qualified. So the marketing funnel generates a lot of leads and potential opportunities. But the sales team then goes through a fairly rigorous qualifying process based on, is there a budget? Is there a compelling reason for the customer to do something? Is there any particular reason why they wouldn't look at our kind of solution? And so on and so on. And only at that point does that opportunity enter the pipeline. And in terms of the win rate, we don't publish a win rate figure. But when we get down to the shortlist stage, we're pretty successful once we get past the RFP into shortlist. And we typically close one in two or one in three, something like that of those. Great. Thank you very much. And has any of the amount from total new orders, which are up 21%, been recognized in the P&L yet? Andrew? So as you'd expect, I mean, we have recognized some of the backlog is revenue in the P&L. Yes. Thank you. And are core software revenues included in the recurring revenue, as it seems low relative to the group revenue? No, it's a really good point. The £15.5 million that I mentioned is only made up of support and maintenance, managed service, and third-party hardware and hosting revenue. We don't include the impact of annualized license revenue. Just to explain that, a typical contract for us is a five-year contract. In line with IFRS 15, our policy is to recognize the license revenue upfront when the license is available for use. Because we have a very sticky customer base, we always expect the customer to renew the contract at the end of the term. At the point at which the contract is renewed, then we can recognize the license revenue all over again. In effect, you could argue that the license stream really is a recurring element of our revenue, but we don't include it in the metrics. I think you could argue that we're being fairly prudent in terms of the way we report the numbers. Tremendous. Thank you very much. And no major new contracts were signed in the latter part of the full year. Is this a timing issue, or is the competitive environment becoming more difficult for new wins? There's no particular change. It is just a timing issue. At this point, last year, we just signed the Virgin Media deal. That was actually really close in the summer. So it was just quite an extensive period of contract negotiation, which you sometimes get with large organizations. But again, it is a timing issue, and we're not seeing any particular slowdown in the market. Great. Thank you very much. And what are your chances of selling to a large telco? Well, we do have large telcos who are customers. That's a good point. If we sort of go back to the logo, oops, excuse me, get there in the end. We go back to the logo wall. Obviously, Virgin Media we've spoken about is a large telco. Orange is a customer of ours where we're actually supplying our software into the Smart Cities project in Egypt, the new capital cities. That's an enormous project where Orange had the contract to provide all the telecoms infrastructure for the new city, initially building homes for three million people and all the office space and cultural centers and so on. But it's not just the telecoms in terms of the infrastructure, because Smart Cities is all about IoT. So everything in the city has an IoT device. So whether it's gas meters, water meters, power meters, parking meters, pretty much everything you can think of that a citizen would use in the city as a service is being built back into this sort of smart city network and processed by Cerillion. That's a really interesting project with a large telco in Orange that we have the potential to replicate in other smart city projects. Proximus is the BT of Belgium. We support one of their challenger brands there. KDDI in Japan, a very large telco. We supply them with network inventory software. Liberty Global, one of the world's largest telcos, we do most of their Caribbean sites. I think the groundbreaker with Virgin Media and with Orange to an extent is that we're working on really strategic tier one projects within the tier one brand, which gives us a good platform to sell more strategic deals into the tier ones going forward. Great. Thank you very much. Previously, existing customers accounted for just 85% of revenue in full year 2024 versus full year 2023 at 99%. What's the reason behind the drop? And is it due to the new contract wins? Yeah. I'll cover that. Okay. So yeah, I mean, essentially, we signed Virgin Media at the start of the 2024 financial year in November. So a lot of that implementation revenue, you can imagine, although we don't speak of it, would have been recognized during financial 2024. Normally, the license revenue would be recognized, as Andrew was explaining earlier, once the software's available for use, which is very early on in our implementations because the product already exists. That would have been recognized. You could assume that would have been recognized in 2024. It's really the fact that that customer was won fundamentally in the summer. We didn't sign the contract till November, so it counts as a current year new logo. That's why we get that skewing of the percentage revenue from existing customers. Also, I mean, clearly, the Southern Africa deal would have had a final impact as well because we've done that very quickly. The customer's in a hurry, so a lot of that work has got done in 2024 as well. Great. Thank you very much. The back order book now has been flat for three years despite growing revenues. Why is this? I mean, I think this is really the timing of customer wins. In 2024, the new orders number was up by 21%, as we explained. But a lot of those new orders were effectively recognized as revenue during the year. So they didn't go into the back order as at the end of the year. So it is really just a function of timing. Great. Thank you very much. Total receivables have gone from roughly 40%-60% of sales over the last two years, which inflates working capital and drags down cash flow. Why has this happened? So as I was explaining earlier, I mean, there has been some increase in working capital during the year. So working capital has gone up by just over £ 6 million. Two main reasons for that. First of all, the way we recognize our license revenue, we recognize the revenue upfront when the license is available for use. Whereas on a typical five-year term contract, the customer will pay us in equal installments over the course of the contract, so what that means is when license revenue is recognized, we typically recognize accrued income upfront, and then that unwinds over the term of the contract. The other element of the build-up in working capital is just due to the timing of receivables and payables. So quite a large amount from a couple of contracts was received in early October versus the end of September, and so that is just a timing from one month to the next. Great. Thank you very much, and lots of questions about the cash pile that's starting to get somewhat large. The shares aren't particularly cheap, but what are you thinking of doing with the cash? Waiting for a deal? Waiting for a better price for buybacks? How do you see capital allocation? So if I start on that one, a couple of points for me. First of all, the cash balance is relatively high at nearly £ 30 million. We think it's actually very helpful to have a high cash balance, particularly when we're looking to win large contracts with large customers. So we're still a relatively small company. And one of the first questions that we get asked is, "What does your balance sheet look like?" Because clearly, customers want some certainty that we are going to remain a going concern throughout the period of the contract they're looking to sign with us. Do we need £ 30 million? Probably not. That is on the high side. But from my perspective, it is still comforting. I'd rather have more cash rather than less. So to answer the question, what are we going to do with it? I mean, we do have a progressive dividend policy, albeit that most of the cash that we generate during the year should be funded by the dividend. But I think the main use for the cash going forward will potentially be on acquisitions. So we're constantly looking at potential targets. So far, we haven't done any acquisitions since the date of the IPO, so it's since back in 2016. I think to some degree, the pressure has been off of us doing acquisitions because our organic growth has been so high. But we are constantly looking at acquisitions, and I think it's just a matter of time before we find the right target. And then the cash that we're sitting on will be deployed in order to purchase a target. But just to be clear, we're not looking at the transformational acquisitions. We're looking at bolt-on, tuck-in type acquisitions to add additional product around the edges of what we do to bring in more telco customers that we can upsell into and vice versa, more product that we can sell across the existing base. Not because we're missing product, not because we can't respond to RFPs because we haven't got enough product. But if we bring in extra bits that sit around the edges of the industry standard model, then it just gives us more options. Great. Thank you very much. And how does customer appetite compare to the past few years? And what's the outlook? Yeah. As I was saying, I think we are seeing some contraction in capital spend, but that's actually playing to our strengths. So as I've said a couple of times now, that is the driver behind the Virgin Media deal, which is a great deal for us. So if you look at the broad picture, if telcos have got a choice between spending hundreds of millions on these solutions or a few tens of millions, then we're the few tens of millions, not the other end of the spectrum. So I think that does help us. And equally, we can still win on a growth driver as well. While I think a lot of vendors in the telecoms are finding the CapEx constraint a challenge, and there have been some quite high-profile stories on that, I think no one's immune and so on, but we're relatively well placed, I would say. Thank you. Can you comment on the pricing environment? Yeah. I mean, well, really, sorry, I'd say the same thing, that there is pricing pressure, but that's pricing pressure from looking at us as a potential solution rather than us as a problem. But there's always a debate about price. There's always a negotiation when we come to the closing stages of a deal. But we're not the cheapest. We're not really doing sort of tier two emerging market stuff where it is all about price. We do find that, as you'll see from the margins that Andrew's talking about, we do find it possible to maintain a significant price advantage without being and still maintain high margins. Great. Thank you. And back orders were £ 46.9 million at the year-end. What was it at the same time last year? So the equivalent number at the end of September 2023 was £ 45.4 million. So clearly, it has increased slightly year-on-year. Tremendous. Thank you very much. And can you hold the EBITDA margin at current levels? Yeah. So on a short-term basis, we're guiding analysts to an adjusted EBITDA margin between 40% and 45%. Clearly, that is slightly lower than we have achieved over the past couple of years, with 47% in 2024 and 46% in 2023. But in the prior two financial years, we have benefited from a relatively high proportion of license revenue, which drops all the way through to profit at pretty much 100%. But we are flagging that in the short term, we might not necessarily repeat this high level of license revenue, so it could come in a little bit lower. And if that is the case, then the margin could be a bit lower as well, hence the guidance in the 40%-45% region. However, I think importantly, over the medium to long term, we do believe that the margin should continue to go up if we can continue to win larger contracts with larger customers. So then there should be a larger proportion of software revenue, which drops all the way through to profit, particularly the license revenue. And hence, we should continue to benefit from operating leverage. Great. Thank you. And how much of the organic growth came from price increases? So in terms of, I mean, unfortunately, we can't give an exact number on that. What we can say is that most of our contracts have indexation clauses linked into them. So when we have a long-term subscription agreement, we can increase the prices to customers in line with inflation each year. So clearly, over the past few years, we have benefited pretty well from that. On top of that, when we are pricing new deals, we typically increase our day rates in line with inflation as well. So unfortunately, we can't give an exact number, but we can say we do structure our contracts to try to offset the impact of inflation. Great. Thank you very much. And how do you think about reinvesting these incremental profits you're bringing in? Are you trying to prioritize growth or profitability? I think the model drives profitability, the fact that we're using the same software for every customer. The SaaS model is, by its very nature, high margin. If you think about our as we increase, as we work with larger customers or customers grow their bases, because our pricing is based on the number of end customers our customers have or number of subscribers, if you like, customer growth generates additional SaaS fees, a lot of which is term license within the subscription fee, which has no incremental costs. The model is just naturally prone to high margin. We look at growth. Growth is our priority, but we're not holding back on putting in new salespeople or doing more R&D because we're trying to maximize margin. We don't really think of it that way. It's just kind of an inevitable result of working with larger customers, customers expanding, customers renewing, just as generates the high margins. Great. Thank you very much. And what's your go-to- market strategy in new countries? And what would you say is the key differentiation versus competitors to win new logos? Yeah, it's a good question. We don't really look at it in terms of go to a new territory with a different approach because it's a global market. And the drivers as to why telcos buy from us are very similar wherever we are in the world. Obviously, the reason for putting regional sales presence in place is that having people who know the local market and are from the local market is beneficial in terms of building longer-term relationships further in advance of when processes are going to start and so on. But in terms of the competitive landscape, again, the competitors are pretty consistently across the regions too. Some of the smaller ones, these small independent software vendors are perhaps still more regionally focused. But the real people we compete with are present in pretty much the same markets that we're in geographically. And that's the large independent software vendors that are typically the providers of more tailored, bespoke solutions that typically take two, three, four, or even five years to implement and are significantly more expensive in terms of TCO over a typical five-year term. And then we also have in every geography the network equipment vendors. So except, of course, in Europe and North America, we don't have Huawei and ZTE, which is helpful for us. That certainly was a bigger problem for us about five years ago before the Chinese withdrew from those markets. And then Nokia and Ericsson are present in pretty much every market. Nokia are a partner, so we don't compete with Nokia. They sell the majority of our modules as part of their solution. That was the route into the deal with Orange, which in Egypt, which is very important to us. And I guess the other sort of competitor type, if you like, is the other SaaS vendors, but niche-playing SaaS vendors, so what we call best of breed. And this is where a consortium of different vendors, SaaS vendors, will get together in a consortium to provide the different pieces of the puzzle or the different boxes in the diagram, if you think about the diagram we looked at before of what we provide across the whole scope. But of course, that in itself just brings back all the old problems with the more traditional solution and that there's a lot of integration required. You need a third-party integrator. That's very expensive. That's a whole layer of extra cost. It takes longer, and it's a lot more risk. So we tend to win against those players because of that differentiation. In a similar way with the large ISVs over here on the left, we win against these guys because we're not having to tailor a solution. The solution already works on day one. It's easily upgradable, and it's a much more flexible, more reliable solution because it's the same standard product all of our investments going into. Now that you're materially bigger than you were, say, two or three years ago, do you think that Tier 1 telcos are now more interested in signing with you for their main brands and services? Absolutely. I think it's the next big brand that gets the next bigger brand. And with each new win in the Tier 1 space, we build more credibility. With each next biggest customer, we build more credibility. So I think that it's certainly the case that some of these recent wins have just helped us with the next step along the way. Great. Thank you. And on the two large contracts you've won, Virgin Media Ireland, and the South Africa operator, you said there was scope for expansion. Could you elaborate on that? Well, yeah, absolutely. I mean, obviously, Virgin Media has a lot of other properties within Europe, in the UK, for example. And I think once we get this solution live in Ireland, there's a good chance that we'll be able to have some quite interesting conversations across the wider group. We have to get it. It It has to be live first. We have to have a proof point. But it's quite a big departure. It's a big departure for Virgin Media, this particular Virgin Media operating unit, to throw away "Nobody gets fired for buying IBM." It's not an IBM replacement, but it's that mantra. You can stick with a big brand vendor, and even if it costs a load of money, well, you're not going to get fired for doing that. So to go with a much smaller vendor with a very different approach, clearly, as long as we deliver, which I'm obviously fully confident we will, then the savings are quite enormous. The additional flexibility and the ability to introduce new products to market faster, that'll become a real proof point within the group, I think. The Irish will be very keen to, or rather, Virgin Media in Ireland will be very keen to promote that more broadly with us. Thank you. Coming back to cash again, the questioner appreciates the ability it gives you in gaining new contracts by showing your financial strength. Is there a threshold where you'd accelerate return to shareholders for, say, an exceptional dividend? I mean, I think for the time being, our focus is really on continued cash generation. As we said before, we are constantly looking at acquisitions. I think that would be our preference for use of cash. I think in the short term, we're not necessarily looking at paying a special dividend to shareholders. I think lots of our shareholders think that is not the most tax-efficient way of remitting cash back. But I think in this case, we don't have a firm plan to do that, but it's something that we can revisit in the future if the cash continues to grow. Great. Thank you. Looking at your product offerings, where do you feel you lack in an offering that could be filled by an acquisition or by R&D? Yeah. I mean, going back to the product map diagram, there are no holes in this in terms of the ability to respond to the standard RFP scope that we see. Where's it gone? I'll just click back. Yeah. I mean, in the scope that is part of what the industry defines as BSS and OSS, we have all the boxes. but the sort of things around the edges that we would look at are things like protocol processing, so more deep within the network layer, things that don't come as standard BSS, OSS product set, but would give us more telco relationships and more things to cross-sell at the sort of top of the stack, perhaps more stuff around data analytics, churn analysis, those sorts of things. so things that aren't really part of the standard footprint but would add extra spice, if you like. Great. Thank you very much. We have loads more questions, but we run out of time. Thank you very much indeed. Louis, do you have any closing remarks? well, no, thank you all for listening. Of course, if anybody does have a question we haven't covered and would like to submit it back into the forum through whatever channel, then obviously, we'll do our utmost to answer them. Great. Thank you both very much indeed. And thank you, everyone, for joining. And you'll now be taken to a web page to give feedback on today's presentation. If you can't complete it now, you'll get a follow-up email. We would be really grateful if you could take a few minutes to complete. Many thanks for joining. This is the end of the webinar.