Right. Let's get going. Just a few points of admin from myself to start with. We are recording this meeting, so if there are points you want to go back and check, you will be able to do so either on the Equity Development or Cohort website. The presenters are gonna use some slides, and that deck is also now available on the Cohort website, so you don't need to be taking pictures of each slide as we move through. The presentation is gonna come first, we do invite you to submit questions, which will be dealt with after the formal part. For those of you who are new to Zoom, that is as simple as clicking on the Q&A button and submitting your question there, which we will endeavor to answer. Obviously, given the activities that Cohort engage in, some of the answers may be politically sensitive or crucial to national defense, so don't expect too much clarity on that one for obvious reasons. Right. Without further ado, I'm gonna pass over to our presenters who have a wealth of experience in the industries and both at Cohort for a substantial period of time as well. We're joined by Simon Walther, who's the Finance Director, and Andy Thomis, who is the Chief Executive. I am going to pass over now to Andy, if you'd like to start the presentation. Yes. Good morning. As Andy said, my name is Andy Thomis, and Simon Walther, our Finance Director, and I will be here to present to you this morning. I will begin, Simon will cover some of the financial details, and I'll sort of round up at the end. As Andy said, there'll be a good opportunity for questions at the end. Can we move to the first slide, Andy? We're gonna set out today for you, I hope the investment case very clearly, but this slide is aimed to give you a summary of the key points. To start with, we've got a strong business model, which we believe is well suited to the sector we operate in. It combines the benefits of small, agile, innovative technology businesses with the strong visibility and balance sheet that a larger group can offer. We've paid a growing dividend every year since we IPO'd in 2006. That's provided a return to our investors and also a practical demonstration of the fact that as well as generating technology, we're also generating profits and cash. Access to growth markets. An investment in Cohort gets exposure to some real growth markets that are driven by global events. For instance, conflict in Europe and tensions in Asia are driving strong increases in regional defense spending. Financially, we are strong. Simon will say more about this, but we have net cash on our balance sheet, and we have excellent banking relationships. Our exposure to growth markets and our innovative agile businesses give us the opportunity to generate organic growth. Another important part of our strategy is to make further acquisitions. We've been making acquisitions since we were founded back in 2006. Our cash generation gives us the ability to fund transactions without recourse to equity markets. We don't rule that out, but we haven't done so since 2007. For quite a while, we've funded all of our acquisitions from our cash flow and banking relationships. Finally, we announced back in December with our half-year results an order book of over GBP 300 million going out well into the long term. That gives us very good future visibility of revenues. Simon will show that in more detail later in the presentation. Our pipeline of future opportunities is even stronger than that, driven, as I've indicated, by international pressures for greater defense spending. If we can move on to the next slide. An overview of the group itself and our background. We were founded back in-- w ell, in fact, we were IPO'd in 2006. We were founded in 2005 by Nick Prest, who's currently the chairman, Stanley Carter and myself. Nick previously led the armored vehicle company, Alvis plc, that was bought by BAE Systems back in 2004, and Simon and I both worked with Nick there. Stanley founded a defense technical advisory business called SCS, which became the first operating business of Cohort when we IPO'd back in 2006. We operate through six separate businesses, and they vary in size, and in the sort of thing that they do, and I'll say a little more about each of them in a moment. Our model is to give them a considerable degree of management autonomy within a light touch, but effective framework of strategic and financial controls. That gives them the freedom to innovate and also the agility to respond quickly to customer demands. Now, as I said, we operate primarily in defense and security markets. By security, I mean national security, so typically quite closely related to defense as opposed to sort of barbed wire and CCTV type things. In terms of size, our businesses range from less than 50 people to over 300. All in all, we have something over 1,000 employees, and a high proportion of those are scientists and engineers, and that is fundamentally the way that we add value through the expertise of those people. In terms of financial size, you can see our most recent full year numbers here. As Simon will explain, we are expected to do rather better in the current year. A bit over GBP 200 million, our market capitalization makes us one of the more serious businesses, I would say, on the AIM market. If we can have the next slide. I wanted to next say a little bit more about what our six operating businesses do, and I'll be happy to elaborate on these if anyone is interested during the Q&A session at the end. In brief, Chess provides surveillance and weapon control systems for land and naval customers, and they supply into the U.K., Europe, Asia, and the United States. They have a very strong capability in counter-drone and air defense technology, which are in demand, especially given what's happening in Central Europe at the moment. EID is a Portuguese business based just south of Lisbon, providing communication systems for ships, armored vehicles, and soldiers. They also have a very international list of customers. ELAC, which is based in Kiel, in Northern Germany, is one of Europe's leading suppliers of sonar systems for both ships and submarines. They are currently providing the sonar systems that will be the eyes and ears of the new Italian submarine fleet. MASS is our largest contributor to group profit. It specializes in services and software connected with intelligence and other sensitive data in the defense and national security world. MCL, or Marlborough Communication systems, works with partners in Europe and also in the United States to supply intelligence gathering equipment, communications equipment, unmanned vehicles, and other systems, primarily into UK government customs. Finally, SEA provides technology-based systems for Navy users, torpedo launch systems, decoy launchers, communication systems, and a very innovative sonar system that is complementary to the ones that I mentioned earlier on offered by ELAC. Moving on, if we can, if I can enlarge a little on our business model. As I said, we see it as combining the advantages of small and medium-sized businesses with those of a larger group. As individual businesses, Cohort's operating subsidiaries have the autonomy to set their own strategy and to make day-to-day decisions without having to get those approved and negotiated with a sort of coordination layer of middle management that you find in some larger defense prime contractors and defense companies more widely. Our process is very simple: Financial and customer commitments need to be approved either within the businesses or by Simon and myself, or by the whole board, depending on scale and risk. None of those approval processes takes more than a few days. That means that we can be pretty agile, even in making quite big decisions. Unlike small independent companies, our businesses also benefit from our strong balance sheet, and that enables them to take on substantial contracts that would otherwise be very difficult. For instance, in recent years, businesses in the group have won several contracts that exceed in value the annual turnover of any of our subsidiaries. As well as that strong benefit, strong financial benefit, they also get the benefit of information sharing and learning from experience, which we arrange through regular cross-group meetings at different levels of the business. My small headquarters team, and indeed, the PLC board, is very experienced in the defense sector and works with all of our subsidiaries, both the managing directors and others, to help mentor, and guide them. Finally, all the businesses gain the visibility that comes with being part of a larger group, whether that is at trade shows or something else we do, is group-wide visits to important customers to show the full breadth and depth of capability, in the whole group. In terms of our strategy, we see it as, we see it as having three pillars: organic growth, acquisitions, and maintaining confidence. Starting with maintaining confidence, that's all about transparency, openness, communication with both shareholders and prospective shareholders. This event, this morning is a, is a good example of what I mean. It's also about risk management and indeed legal compliance, which seems to get more complex, every year in terms of both legislation and regulation. I'll talk about our acquisition and organic growth strategies in the next two slides. If we can come to the next slide. Since 2006, we have grown from just one operating subsidiary through to six by making careful acquisitions. As well as adding new businesses to the group, we've also done several built-in acquisitions where we merge an acquired business with one of the existing subsidiaries. We've also conducted several divestments where it's become clear that part of our operation could prosper more effectively and be more valuable under different ownership. In doing that, we've made simple cash acquisitions, we've made acquisitions with earn-outs based on revenue or profit. We've made staged acquisitions, where we acquire a bare majority stake and then acquire the remainder at a later date. In one case, we've made an acquisition of a majority stake alongside a continuing government minority shareholder. Our flexibility as a team, and the fact that decisions on acquisitions are made right at the top of the organization, Simon and I are always actively involved in acquisition processes, has enabled us to bridge value gaps and negotiate acquisitions that would have been difficult, I think, for our competitors, and that's been a source of strategic advantage. We're not an acquisition machine with a target to do a certain number of transactions every year. We are actually rather discerning as far as acquisitions are concerned. We're very aware of the risks of doing acquisitions and the fact that track records have not always been good at doing acquisitions in the sector. We only acquire when we're convinced that it will add value and contribute to the long-term growth of the group. I think it's fair to say that our acquisitions in that respect have been pretty successful. This slide shows our acquisition activities last year and our priorities for this year. In the last year, well, we reviewed numerous opportunities, that is the case every year. An awful lot does certainly come past my and Simon's desk. In terms of activity, the main one was, well, about a 50% stake, actually, in the joint venture, JSK, that our business, SEA, has in Canada. That's operationally important to us both to do business in Canada, on one particularly substantial program, and also more widely to support equipment that's in service in Canada. We've acquired that from the previous joint venture partner. Our priorities in the current financial year. Well, one was completion of the acquisition of the minority interest which existed in Chess, which we acquired a few years ago, and that's now been successfully completed. We continue to seek value-adding acquisitions with strong market positions in relevant sectors. Quite a few of those come to our attention, both from intermediaries like our M&A houses, and directly, where business founders and owners, knowing of our reputation and our strategy, approach me or one of my team directly with an idea that we may be a good fit for them. That's an outline of our acquisition strategy. On the next slide, I would like to say a little bit about organic growth. In pursuit of organic growth, we support and encourage our businesses to develop long-term customer relationships, which they have successfully done in many cases, and also to find new growth opportunities. We monitor their progress very carefully, and if we feel it is necessary, we will act without hesitation to make changes to management or to strategy or to both, if that is necessary to gain access to those opportunities and to that organic growth. This slide says a little more about our recent activities to support organic growth in the group. In the last financial year, 2021, 2022, we ended up with a record closing order book, and improved visibility at three of our businesses. New leadership, which we've brought in at two of our businesses, SEA and EID, had begun to make very strong progress. In 2022, 2023, we're gonna look to continue to improve that long-term order book, and as we showed at the half year point, we did so in the first half of the year. We're going to seek opportunities from increased focus on defense spending, especially in the NATO countries, several of which have announced substantial increases in defense spending as a result of the conflict in Ukraine. Also more widely, where we've seen substantial increases in defense spending announced, for example, in Pacific. Much of our business, before I hand over to Simon, much of our business depends on large contracts that are lumpy in nature. We haven't achieved organic growth in every single year of our existence, although I think it's fair to say we've done pretty well. Simon will now talk through our record in recent years in delivering what I think it's fair to say is considerable level of organic growth. Simon, over to you. Well, thank you, Andy. Good morning to you all. As Andy's just touched on, I mean, generally, we've been growing reasonably well over the last, well, many years. As you can see from this five-year record, we've had steady growth up until 2021. We had a bit of a blip in 2022, which was caused primarily by weaker operating performance at Chess, which resulted in some management changes that have been made, and we're starting to see that turn around in the first half of this year. Also, EID concluded a very large export contract in 2021, unfortunately delays to domestic customer orders, particularly in the naval sector, which we're expecting to see come through in the next 12 to 18 months. The Portuguese MOD have been particularly slow on those. You can see what we refer to a term called adjusted operating profit, and you'll see adjusted earnings as well. That actually effectively is operating profit, excluding the amortization of intangible assets, which fetters goodwill in the old days, and also marking FX contracts to market, which again, is a non-cash effect. The other thing to point out here is the continued, and Andy mentioned this, dividend increase. We've increased our dividends since listing in 2006. We've maintained a progressive dividend policy. Most importantly, the order book. I mean, it's a record high at the end of 2022, at GBP 291 million. It actually grew again in the first half of this year, and we reported just over GBP 300 million at the half year last October. You'll see another slide shortly that will explain that. That has been a very progressive movement on the order book. We can move on to the next slide, please. Thank you. These are consensus forecasts for the next two financial years. We have an April year-end, 30th of April year-end, so we're coming towards the end of financial year 2023. We reported the figures last December for the first half. It was a strong first half, and I'll talk about that in the next slide. One thing to point out is that around, at that point, 95% of our revenue was on contract for delivery in the second half. Obviously, that doesn't mean it may or not be delivered. There are issues that we continue to see in the supply chain, customers can be difficult sometimes and delay things, but generally we're fairly confident on that revenue line. The other things on here, again, pointed out the profit before tax is the adjusted profit before tax. It just takes off the interest. The earnings per share is the adjusted earnings per share and, as I said, dividend per share, you can see going out, increasing. Also we remain in a net funds position, both for this. I'll talk about in a bit, at the half year, we were slightly in debt, but we're now expecting to be in net funds over the next two years. If we can move on, please. This was the financial highlights at the half year, you can see it was a very strong first half. Nearly 30% increase in revenue, a very large increase in the adjusted operating profit and very large increase in adjusted EPS. I mean, this was driven by the strong order book we had at the start of the year, an improvement in the performance at Chess particularly. EID has continued to struggle, and we expect this year that it'll probably break even over the whole year. Importantly, the order book, over GBP 300 million, covering 95% of our expected revenue for the full year, and as I've touched on, another 10% increase in the dividend. We did end the half year with slight net debt, and that was all to do with the timing of working capital, particularly at some of our more active businesses. That actually moved back into net funds in early December. We've remained in net funds since then and expect to end the year with net funds. Now, the order book, this is the half year position, and what you can see here in the left-hand column is the actual order book at the half year point. The next four columns are the runoff, the expected runoff of that order book. It's important to point out that that order book is contracted. It is not a pipeline. It is not a sort of framework. It is actual under contract purchase order book. You can see we're expecting GBP 82.5 million of that to be delivered in the second half this financial year, and we've already got GBP 80 million into the following year. The order book itself goes out to 2032. You can see the large parts are SEA, with just under GBP 100 million, MASS at about GBP 65 million, and big orders also at ELAC and Chess. MCL typically operates on visibility of around three to six months. For it to have an order book of GBP 25 million at the half year was a very good position, and we expect a quite strong performance from MCL in the second half. Overall, we're reasonably comfortable with the consensus forecasts that are out there at the present time. Thank you. I'll hand back to Andy. Andy, you're on mute, I think. Thank you, Simon. I knew that was gonna happen at some point. Just looking at the, at the wider picture, and the drivers for growth in our industry. In, in Europe, as everyone is aware, we have a very a difficult conflict going on between Russia and Ukraine. That has since February last year, resulted in a very substantial rethink in many NATO countries about the importance of defense and spending. I'll say more about that. We've seen some very substantial announcements by actually the majority of European NATO members about increasing the level of defense expenditure, recognizing the risks that they face, which have become so apparent. Similarly, we're also seeing very substantial tensions in the Asia Pacific region, driven by China's pretty aggressive military actions around the South China Sea. Its claim for most of the South China Sea as its territorial waters, you know, absorbing quite a bit of territory that is actually legally part of several other countries. In particular, Xi Jinping's continued commitment to making Taiwan an inalienable part of the People's Republic, which has led to increasing concerns about potential invasion of Taiwan. That has had a marked effect on spending in the region. Recently, Japan has announced a doubling of defense expenditure as a proportion of GDP, which will make it one of the largest spenders on defense in the world. Right around the region which I visited with several of our managing directors from around the group last year. There was a strong need, particularly for naval systems, as the Chinese threat in that area is principally a maritime one. The big picture is that defense expenditure being driven by these geopolitical events is growing. As far as our domestic markets are concerned, well, we had previously an announcement of significant increases in defense spending, and a mini-spending review is going on right now. We're expecting to see the results of that early this year. Given the events in Central and Eastern Europe, I would certainly expect that to be reflected in the result. In Portugal, another domestic market for us where EID operates, we are seeing some increased opportunities domestically, with a number of quite important programs for EID lining up where they are either sort of pre-selected as the provider or bidding against other competitors. We see opportunities growing there after a relatively light period for defense defense expenditure on relevant equipment in Portugal. We've seen growing orders from the German domestic market as well for ELAC. ELAC is like EID, very much focused on export opportunities, but it does supply specialist sonar equipment into the German domestic market. The large increase in defense spending announced by Chancellor Scholz last year, is resulting already in some increases in orders for them. Our export markets, as I've indicated already, are strong in the other NATO countries. We supply into France, Belgium, the Netherlands, into northern Europe. We also supply considerable amounts into Asia. Increasingly we see Australia as being a very important market, where again, activities by China have resulted in a reevaluation of the importance of defense spending, and for example, in the decision to acquire a fleet of nuclear submarines, which I strongly expect that we will be involved in some aspects of the supply of those, and we're certainly looking to do so. The world picture overall, I think it's fair to say, does present a positive medium-term outlook. Could we have the next slide, please? To wind up, I'll try and summarize what I've said in making the investment case today. We've got an experienced leadership team, both in the headquarters and within our subsidiaries themselves, with very strong capabilities and a lot of experience in defense and security. The ability of those small and medium-sized businesses to grow and to access growth opportunities, that is helped by the fact that we have such a strong balance sheet with robust funding and a very strong set of banking relationships. Alongside organic growth, we have a strategy to grow through acquisition, and we have a track record of growing acquired businesses successfully. As I said, we're discerning in our acquisitions, and we only do so when we're convinced that we can do it in a way that will enable us to increase long-term growth. As Simon has shown you, the dividend's increased every year since the IPO in 2006. That remains our policy providing a return to investors, and also a visible demonstration of our success as a trading business on the AIM market. The record order book, which includes revenue out to 2000 much recently, is a tangible indication of the positive market outlook that I outlined to you on the previous slide. I think I'll add one further point to those in the investment summary. If, as investors, you believe that the social value of investment is something that is important, and then by supporting us and by investing, you're contributing to the most important social value of all, which is the security and stability of society, on which all other social values depend. All of our rights and all of our benefits really don't have meaning unless they rest on a secure and stable society. We've seen a pretty brutal illustration of the kind of risks societies face if they are perceived as weak by potential adversaries since February 2022. Because we live in a dangerous world with some dangerous people in it. Our armed forces, and their bravery and their willingness to make sacrifices are a vital protection against that kind of aggression. Cohort and the Western defense industry more widely, also make a very important contribution to their activities and to the security of our country and to the security of our allies as well. As someone who's part of the industry and an investor in it myself, along with Simon, I'm very proud to be part of that enterprise, and I believe that our investors can be proud of taking part in it as well. If we can move on to the final slide. Yeah, in a few words, this is our vision for the future of the Cohort Group, a major independent defense technology group offering world-class systems to domestic and export customers alike. We've made a lot of progress towards that aim, growing in size, in visibility, and in reputation, over recent years, and I certainly see it as being within reach. Thank you all for your attention this morning. I hope that that has been helpful to you. If you have any questions for us, we'd be delighted to try and answer them now. Great. Thank you very much, gentlemen. Very thorough, on the business and, you know, the big, bad world that we're living in. To remind people, we've had quite a few questions already emailed to us, and you can also submit via the Zoom Q&A button if you have any specifics. Let's dive straight in. Recognizing that there is quite a long lead time, in a lot of the products that, you develop, can you say, at the moment, which of the defense segments where you are active, you are seeing the most material changes, in spending patterns? I think that can apply to geographies as well as products. Yeah. Well, as I mentioned in the presentation, I suppose the two sort of most important forces as far as the market are concerned are the invasion of Ukraine by Russia and the tensions being generated by Chinese activities in the Asia Pacific region. If you look at Asia Pacific, I mentioned Australia as reviewing quite significantly its defense posture, increasing its spending. Japan doing so, announced recently, very radically indeed, and becoming one of the world's largest defense spenders. Right around the South China Sea region, Malaysia, Thailand, Indonesia, the Philippines, and the smaller countries in that region as well, are looking to show that they are prepared to and willing and able to defend themselves against aggressive acts by regional neighbors. Of course, in Europe as well, we've seen an announcement of, I think, EUR 100 billion of additional defense spending by the Germans. We've seen Poland announcing a very significant increase in defense spending, and other NATO countries as well, realizing that they can't be free riders on American defense spending, and that they have a need and a responsibility to defend themselves too. Those are the areas. In terms of a sectoral answer to your question, I think particularly in Southeast Asia, we're seeing demand for naval systems because the threat is principally maritime. As far as Europe is concerned, we see increasing demand for sensor and intelligence gathering systems related to the land environment in particular, and air defense. Okay. Thank you very much, Andy. Maybe one for you, Simon. You've mentioned some of the problems that Chess has had in the past. There have been changes. Can you shed a little more detail about how pleased you are with the developments at the moment of the business? Yeah. Andy, jump in if you want at any point. Yeah, when we brought Chess, I mean, you know, four, five years ago, Chess was turning over around about GBP 8 million per annum. It's now moving into a sort of GBP 30 million business, which is quite a marked change. It's been going through some growing pains, basically. We've made some changes to the senior management there. We've beefed up the senior leadership team quite substantially at the business. It's increased its headcount by about a third over the last couple of years, bringing in more capable engineering people and senior management. We're also spending some time with them on improving their sort of processes particularly around bidding. It really is the aim is to get the business, which has been absolutely superb at winning orders, to get better at delivering them. It's had a few problem projects that we've pretty much closed most of them out now, and that's what's impacted its results over the last couple of years. We certainly expect, once those projects are closed, to move the business ahead. As Andy touched on, I mean, the current environment for Chess's products, particularly in Europe, are quite appealing, you know, counter-drone and air defense systems, which is one strong area for Chess. There's plenty of market for Chess, and the pipeline looks good, so it's important that we deliver, and that's why we've made the changes we've had to. I mean, one of the things we're looking to do, it's had a pretty poor cash performance over the last couple of years and ended 2022 with a GBP 11 million overdraft. We're hoping to get that substantially down. I mean, at the half year point, it was around about GBP 5 million overdraft. By the end of this year, we'd hope to get that even lower, maybe even breakeven, but we will see. Certainly moving into next year, we expect it to move back into positive cash, which I think is a reflection of the changes we've made at the business. Yeah. I'd only add that it's the improvement in performance in Chess in the first half of the year is really quite marked, and made a big contribution to that overall very improved performance as Simon described. Good. Sort of keeping that positive theme, again, Simon, MCL had a very good first half, and you mentioned an exceptional order book. Could you elaborate on where and what sort of business they're winning and why they're doing so well at the moment? Yeah. I mean, again, Andy can jump in, but, I mean, MCL is primarily works for the MOD. 95% of its business is U.K. MOD, it's a sort of a number of factors driving it, primarily in hearing protection, particularly for the armored fighting vehicle fleet. That's going through a sort of an upgrade and new systems being brought. We're also looking at intelligence gathering equipment Areas like drones and counter-drone systems which MCL works in. It's been driven by and us, you know, no doubt some of it's been driven by what the MOD is seeing happening in Europe at the moment and the need to upgrade their systems and to invest in them. I don't know if that, y ou know, it has had a very strong first half, and we expect the second half to be even stronger. I don't know if, Andy, if you want to add anything on MCL. I think that about covers it. Yeah. It's, yeah. It's our smallest business in terms of people, with less than 50 employees, and has a different business model in that it works with partners to deliver things primarily for the UK government. So, you know, it's a little unpredictable from year to year. I think it's fair to say, although it's been growing steadily recently. But we've just seen a convergence of factors in the last year, where several different sort of lines of demand have converged and result in a very strong year for MCL, which, you know, but we expect that to persist for a little while. All right, then. Perhaps one for you, Andy. The structure of the group, we have a question. Do you have any examples of how collaboration between the different businesses is paying off? More strategically, and I'm sure you've thought long and hard about this, can you explain why you've chosen to keep them as independent brands and names and operations rather than having a single unified cohort product? Yes, of course. Yeah. There are plenty of examples of where our businesses are working together. I should say that, where I mean, our businesses do fit together quite nicely strategically. Our policy is that, where there is an opportunity for two businesses to work together, it is always on an arm's length basis. What we certainly don't do is to say, "Well, just because it's possible for two of our businesses to cooperate on an opportunity, then they must do so." Our businesses look to find the best partners to actually win the work rather than work together to internalize more of the revenue, because if you don't win it, then you don't get to internalize any revenue at all. That said, our business leaders meet regularly. They know each other well. We had a meeting together just yesterday. That builds an atmosphere of trust and knowledge, which enables them to work closely together when the opportunity arises, and it makes them sort of natural partners. I can think of one area, for example, at the moment where SEA and Chess are working together on a particular opportunity for the UK Royal Navy, where each of them brings a particular strength. In fact, in both cases, you know, sort of world-beating strength that makes them an extremely strong team together. You know, I won't go into the details of that, but it's a very important project for the Royal Navy's surface ships. There are plenty of other opportunities of that, where, you know, companies either have technology that works together, so SEA working with EID to provide surface ship communication systems, for example, where they have complementary capabilities, or where they can work with each other geographically. EID acting as a conduit to supply other group equipment, and to promote other group equipment in Portugal and similarly with our other markets. There's plenty of examples of that. Why do we keep the businesses separate, and not bring that full sort of 1,000 people with all of the engineers and scientists together? The answer is that, if we were looking to design and provide our own submarines, surface ships, combat aircraft, then undoubtedly that's what we'd need to do, because you need that size of team and that and that level of coordination across a single team in order to develop and deliver on those large, incredibly complex projects. We operate at a different place in the supply chain. Instead of providing a surface ship, for example, we provide all of the things that go on that naval ship to make it effective. You know, surface ships are brilliant. Naval surface ships, they can go halfway around the world without refueling at sort of speeds that you could tow a water skier at. Unless they've actually got communications, sensors, weapons, then, you know, they're gonna be wondering what it is they're gonna do when they get there. Those are the things that we provide. Those benefit those kind of systems from the innovation that small teams of really good scientists and engineers can provide. They don't need that huge set of processes and coordination. What they need are good ideas and also because they're working with large, slow-moving customers, the ability to be a bit quick on their feet as well and adapt to changing circumstances. So those size businesses, small, innovative, agile, fit in very well to the supply chain. So we try and keep those benefits while adding in some of the benefits of being part of a larger group as well. I hope that answers the question. It does, and it's a very nice sequitur to a separate question that said, given technology and development, good ideas often come from smaller, agile businesses. Now, do you have regular contact outside the group with people who come up with those new products and ideas? Separate but related, there's another question of whether cyber defense is likely to be of interest to you going forward. Yes. On the first question, yes, we do have very frequent and regular contact with entrepreneurs and technologists of one kind or another who are coming up with new and interesting and exciting ideas because we're quite widely known in the space as an organization which uses and promotes those ideas. Maybe the best example of that is at Marlborough Communications, which works with a very wide range of small companies that would find it amazingly difficult to deal with the UK MOD on their own. It is a sort of process driven bureaucracy, and it's quite. The bidding processes and the frameworks and all of the techniques that the MOD use are really quite inaccessible to the smallest kind of innovative business. We can act as a bridge and really help those customers and help the MOD as well by gaining access to that kind of technology. We're always interested in new ideas elsewhere in the business as well, certainly willing to consider them. As far as cyber defense is concerned, that's an interesting one. In contrast to quite a bit of the other things that we do, which are based on sort of technology that is scalable, we can provide some pretty fantastic Counter-UAS systems, for example. Once you've designed one, you can produce quite a lot of them. It's scalable in that sense. Cyber really relies purely on people and innovative software ideas, which once they're used, they're gone, and you've got to come up with another one. It's not scalable in quite the same way. The resource that you need to provide those things is people, most specifically data scientists and software engineers, and particularly if you're getting up to the sort of higher capability of things at a very high level of security clearance. Those are a scarce resource. We think that some of the multiples that have been paid for cyber businesses have overestimated the growth prospects, primarily because of that resource dependency. That said, we have one very good business in the form of MASS, which, you know, as a business, has historically always been very attractive, to employees with those sort of skills, which has itself, made pretty good inroads into the cyber business. We've aimed to grow that organically, rather than by acquisition. I would just add those caveats to the growth prospects of that business. Great. Thank you very much. Great. Simon, master of coin, a couple of questions of margin going forward. Firstly, if you could just clarify topical worries about what interest rates and rising cost of energy across Europe might mean for the group. Then, after that, if you can just, you know, a number of businesses are seeing, finally, improvements in supply chain delivery of key components and comments on what you're seeing in terms of how that affects your product availability. Okay. Let's start with the first point, which was sort of interest rates, and I suppose inflation linked to that. Obviously we are in net funds, but the fact is we do have some debt, and obviously the leverage between the debt rates and the deposit rates mean that we are paying interest a moment. We are managing our balance sheet on that, and I'm looking at how we can sort of manage the interest charge. It's not a significant factor for us, and it's not something I particularly worry about. Moving to the point on the supply chain. We've seen some difficulties, particularly in Portugal, interestingly, which probably is linked more to the size of the Portuguese economy than to anything particularly to do with our business. Generally, we have seen an easing of the supply chain. In some areas there are still challenges. Obviously in semiconductors, it's still quite a challenge. Interestingly, things like slip rings and which basically involve ball bearings and that, have been quite delayed. In other areas we worked hard to sort of find alternative components that we've done well on, particularly in Germany. I mean, you know, the one thing about us being agile is that we can look to put alternatives into the things. For some defense products, particularly those on airframes, but and even on ships and land, it's difficult to change the component because of all the testing that's required and the fact, you know, effectively, once a platform's done, I mean, to a certain extent, older platforms, obsolescence becomes the real issue that you have to manage and sort of almost having technology that's quite old still to be compatible with its application. Turn to the other question about energy prices, which is linked to inflation. We're not heavy production. I mean, our main cost, our main resource is our people. We do have one or two factories, I would say that probably the biggest area we've seen energy hikes is in Germany, where as part of the sonar production, they're involved in ceramic production, a process called pottery, which effectively is, you know, heating ceramics and shaping them and fitting them with electronics. That obviously is quite energy intense. We have seen some increase in the costs, particularly in Germany. Elsewhere in the group, yes, we've seen increases in, you know, things like energy and other component prices. Our contracting, particularly with our main customers, our long-term contracts, have all got built into them, clauses that enable us, you know, using indices to recover inflationary pressures. Despite our order book going out for 10 years from now, it's not as if, you know, if we had inflation rates running at these levels, at that rate, in 10 years' time, we'd actually making no money. Our contracts have a lot of protections built into them. Obviously, shorter contracts don't tend to, but they're being completed and delivered in a much shorter timeframe. Often with what we supply in some areas, you know, it's not as if you can walk down the high street and find five or six of these businesses supplying these things. There's generally one or two. Therefore, as you've seen recently, the MOD, particularly on the JSF, the Joint Strike Fighter, will have to bear the cost of the exchange rate that they've suffered because of the weakening pound against dollar. you know, they've got no alternative. That's what they've gotta buy, and that's what they need. Yeah, we obviously build in as much protection as we can against these inflationary headwinds. you know, we manage that, and obviously, the businesses themselves remain close to it. Hopefully, that answered all those points. It did. It was a big question. Thank you. Perhaps a slightly more specific question coming in on your Sea Eagle range of products. Someone is just interested whether what the feedback is for clients who might prefer their sites as part of an integrated gun weapon system as opposed to buying standalone kit. Yeah. Well, we can provide both actually. We've typically provided the Sea Eagle as a standalone to be integrated by a prime systems integrator. I mean, that's the way we sit in the supply chain. We're perfectly capable of integrating it with other sensors or with weapons. We can supply either. I would say in relation to the Sea Eagle that it is an exceptionally cost-effective system that has proved very attractive to customers that are price sensitive in certain markets. You know, we're very pleased with the progress, both in those kind of markets and in the sort of top-tier defense purchases in Europe and NATO as well. Okay. That's very good. The U.S. Defense market, not a, not a small one. Again, just linking a couple of questions together, there. Is the competition too big and entrenched domestically there for you to make significant headway? Is it a market you might be looking to acquire appropriate businesses in? Do you instead use relationships with key contractors in the U.S. to develop your business? We are making some modest inroads into the U.S.. We have some further opportunities there. Those are accessed through strategic partnerships with players inside the U.S. for the most part. It is a very large market. We would love to do more in it, but it is also a very national market, a market where decisions are strongly politically influenced and strongly influenced by factors such as domestic ownership, veteran ownership, veteran involvement and so on, which are not things that we can easily replicate. In addition, you know, acquiring businesses in the U.S., multiples are higher over there. You know, that may not represent, you know, as good a return for our for our investors as making acquisitions, you know, even undoubtedly, what are not, you know, the same market in terms of size, nevertheless, you know, accessing very substantial markets elsewhere in the world. It's something that we'd pursue cautiously. If you look at the track record. I mean, one of the things that is positive for being based in the U.K. is that U.K. businesses almost uniquely have the ability to buy U.S. defense businesses without sort of government intervention shutting them out. That's great, except that there is still a very high degree of government intervention. For businesses in the kind of areas where we operate, which tend to be more security sensitive, it often results in the need for either a proxy board or a special security agreement, which limits our ability to use the kind of business model that I've described to you today, which is based on information sharing, cooperation, mentoring, you know, all of those things, the relationship between the center and the subsidiaries. That would be hard to do in the case of a proxy board or a special security agreement. There are a few factors that militate against it, but that's not to say that we don't think the U.S. is a very attractive market, and we access it by different routes where we can. Yeah. Again, just developing that theme about the U.K. being well-placed and certainly in relation to America, where there's been increased activity in banning semiconductors and other technology products purchased from certain Chinese companies. The question is, are there any positive implications going forward for Cohort and other suppliers in countries that are closely allied to the USA? Well, I should say, and make clear that we don't manufacture semiconductors. Not in that sense... Yeah. is the answer. No, I mean, I think that's an interesting a strategic decision on its supply chain that's being made by the U.S. Clearly it has the financial clout to make the multi-billion dollar investments in semiconductor foundries that would be needed to replicate the capability which at the moment is only available in Taiwan. That is primarily a geopolitical question. I mean, we'd be delighted to have other sources. I mean, many of our products use advanced semiconductors. Increasing diversity of supply would be a valuable thing for us as well. Very good. Sticking on the, you know, the British nationality, the short but interesting question is, how has Brexit affected your business given your existing European activities and your diverse global client base? Well, it means I have to get my passport stamped every time I go to say, Portugal or Kiel, which is marginally more boring than it used to be. Apart from that, I would say it hasn't really had a material effect. We completed the acquisition of our business, ELAC SONAR, which as I've said, is one of the leading European suppliers and, indeed, one of the leading world suppliers. There are not many who can provide that level of technology for sonars. We had to get that approved by the German government after Brexit. I have to say, we did see one or two interesting comments in some of the sort of written recitals to the agreement that we entered into about that, which suggested a certain resentment of the Brits for leaving the EU. Actually the practicalities of it were really no different to what they would have been pre-Brexit. You know, the U.K. security relationship with Europe is just as strong as it's ever been. You know, regardless of the free movement of goods, there is no duty on imports into the EU for defense equipment to be used by EU countries. You know, there hasn't really been a material impact on it at all. I think I'm happy to say that it hasn't had a major effect on us. I mean, I suppose you could look at indirect effects. You know, maybe there's been an effect on the U.K. economy. If you actually look at, you know, if you look at the wider trade picture with Europe, certainly there's been a blip since 2016, but that's a blip on what has been a long-term increasing trend. Good. I think just a final question, whilst we're talking about Europe, and a very topical one, obviously the debate that the German government and the German population have had about whether to supply Leopard tanks to the Ukraine or not was pretty much split down the middle. The question is, do you think that there are any longer term ramifications for the unity of NATO and coordinated Western European defense from the, you know, the clear diversity of opinion in Germany? I'm not sure I'm the right person to be asking about that, to be fine. Absolutely, Frank. Best guesses are absolutely- I'd be after a few glasses of wine over the dinner table, I'd be delighted to expand on it, but I think it's probably not appropriate in the current circumstances. I would say that I think it's greatly to the U.K.'s credit that its government has taken the stance that it has in relation to Ukraine. I think that the points I made about the importance of national security to all of the many benefits that we almost take for granted and argue about, you know, none of them would be relevant if it wasn't for the fact that we've got something to rely on as far as our national security is concerned. Great. Well, on behalf of the audience, Simon, Andy, many thanks for an awful lot of insight and your transparency. Thank you to the audience for very interesting questions. For anybody who arrived a little bit late, just a reminder that this presentation has been recorded, so you can catch the early part as well. It'll be on the Equity Development and the Cohort websites. The slide deck is also available on the very informative Cohort website as well. Best of luck for the rest of the year, gentlemen. Thank you very much indeed.