Good morning, ladies and gentlemen, and welcome to the Lords Group Trading PLC Full-Year Results Investor Presentation. Throughout this recorded presentation, investors will be in listen-only mode. Questions are encouraged. They can be submitted at any time via the Q&A tab that's just situated on the right-hand corner of your screen. Please just simply type in your questions and press send. The company may not be in a position to answer every question it receives during the meeting itself; however, the company can review all questions submitted today, and we'll publish those responses where it's appropriate to do so on the Investor Meet Company platform. And before we begin, I would just like to submit the following poll, and if you'd give that your kind attention, I'm sure the company would be most grateful. I would now like to hand you over to the executive management team from Lords Group Trading. Shanker, good morning, sir. Good morning, and good morning, everyone. Welcome to our full-year 2023 results. Thank you for taking the time to join us, this morning. The agenda is an overview by myself, followed by a financial review, by Chris Day, our CFO and COO. There'll be a strategy update and an update on our ESG between myself and Chris, and then our chairman, Gary O'Brien, will provide a summary and an outlook for the future, followed by Q&A. So over to the overview. The highlights of full-year 2023: In principle, we believe that we have, through our wonderful 950-odd colleagues, produced a resilient performance despite challenging economic backdrops. We've also taken strategic actions to protect profitability and our cash flow. In terms of high-level numbers, we're in line with market expectations, with revenues at a record high of 2.8% like-for-like—sorry, 2.8% overall—and a like-for-like revenue, still being resilient, albeit negative at 1.2%, which I think is a really good performance given the backdrop. We've continued to see robust plumbing and heating division deliver revenue growth reflecting its recurring demand profile. This division had total growth of 8% and a positive like-for-like growth of 3.7%. In our numbers, it's clear to see that we've had a strong focus on cost control, and that discipline will be maintained throughout our 2024 period. Our ESG strategy and net-zero ambitions have been fully defined during the course of the year, and we've got a roadmap that we've identified to materially reduce our emissions. We remain confident in our medium-term prospects, and therefore are maintaining our dividend of GBP 0.02 for 2023. Overall, we still maintain that we remain a small business, less than 1% of a GBP 55 billion market, and our growth strategy continues to be based on product range extension, branch expansion, and accretive acquisitions. I'll hand over to Chris for the financial review. Good morning, everybody. So I'll tell you through the FY 2023 numbers, which, as I think Shanker's already said, we think is a really solid performance in what is a difficult market. That's built off our operating model, and we've spoken to you before about the centralized entrepreneurial and agile structure that we operate, and we really feel that's what has helped deliver these numbers and see the outperformance against the market. As you run through the table, revenue of GBP 462.6 million is up 12.6% on the prior year, or 2.8%. Adjusted EBITDA at GBP 26.8 million, down from GBP 30 million in FY 2022 and 10.5% reduction, but we still think in the climate, a very good result. That also includes the Alloway acquisition, which we announced in H2, flagged as a loss-making business at the time. Absolutely clear rate of recovery sits in five very strong complementary markets in the south, south of London, but in the FY 2023 period does contribute to a drag on EBITDA. Adjusted EBITDA margin of 5.8% versus 6.7% in the prior year, and I think that's really reflective of a number of things. One, you've got the outperformance in plumbing and heating, where margins are typically lower than merchanting. Two, battling deflation in product categories, particularly within merchanting, and inflation in the overhead base. And thirdly, the point I made a while ago around Alloway. Adjusted profit before tax of 10.4 million is a GBP 7 million step back on FY 2022. Simply, that's the GBP 3.2 million of EBITDA plus GBP 2.8 million increase in interest, reflective of base rate and average net debt, plus GBP 1 million of goodwill and depreciations, so non-cash. To that point, free cash flow conversion remains very strong at 59.2%. Actually, underlying, I think, is even stronger when we come to that on the slide in a second, around some of the movements in that cash flow. Adjusted earnings per share of 4.35p and a dividend of 2p, as Shanker said, very much reflecting our confidence in the medium and long-term outlook of the group despite a challenging 2024. For merchanting, resilient performance, you know, certainly the more exposed the two divisions to the macro situation, more discretion in its spend. But overall, a good result, revenue down 2.6% at GBP 248.9. Like-for-like negative 6.3%. That does sit very well against listed peers. Adjusted EBITDA of GBP 14 million against 16.1%, and that margin compression, as I spoke about a while ago, you know, particularly in merchanting, it is an operationally leveraged business. A small reduction in volume compounds quite strongly, and likewise, the return of that volume does the opposite and recovers quickly. For plumbing and heating, much more resilient. So if you step back here, 80% of the revenue is in boilers. That is an incredibly resilient product category in the U.K., kind of very, very strong consistency over a 30-year period. Doesn't always behave kind of month to month, but across the year, you get this kind of real strong, consistent demand and revenue. There's the difference, the delta between like-for-like and overall growth of 8% is the full-year impact of the 2022 acquisitions, being Direct Heating and HRP Trade, and they continue to perform very, very well and add real good synergy into our customer proposition. But EBITDA margin does step back. Those that have watched the stock closely will know we've made really strong progression in overall margin, EBITDA margin, but particularly plumbing and heating. And so this is a small step back, but I think an understandable one and one that should recover with market conditions. You move to the balance sheet, which we think is stable. Believe it's stable. Net debt of GBP 28.5 million. That's comparable to 19.4% in the prior year, so that's reflective of the activity around freehold purchase of one of our sites in London, the Alloway acquisition, Chilton Timber, and the various deferred consideration commitments that flowed out in 2023. We have extended our debt facilities, recently announced, so that adds a year, and they expire on the 5th of April, 2027. Significant cash headroom, as we'll discuss and cover again, mindful of the environment and we'll be prudent in the way we execute and where we take leverage. So you go to cash flow. Start at the top with the EBITDA of 23.5%, and that delivers at the bottom a conversion of 59.2% or GBP 13.9 million of free cash flow. That compares to 66.9% in the prior year, but actually, the underlying position, I think, is probably stronger than the prior year. The rationale for that is of the GBP 4.9 million CapEx, 2.2% relates to freehold, and in FY 2024, we expect CapEx to actually be about GBP 2.5 million as a run rate. Then you can clearly see the impact of the interest position. The one other point to call out here is the working capital movement, 0.8%. We have a substantial base of working capital. It's very well controlled. Good oversight from a group perspective, but divisionally, it's undisturbed and well controlled. So that allows us to invest for growth, but fund it through other initiatives to be where we're more efficient in that working capital base. So that's the end of the financial review. I'm just going to cover the first slide and the strategic update for you before passing back to Shanker. And it's really to outline the track record of growth for the group. We've navigated 2023 very well. 2024 is the next challenge. But when you look beyond that, this is a group that's delivering very, very strong double-digit CAGR in revenue and adjusted EBITDA, 36% and 37% respectively over a 10-year period. Despite that growth, less than 1% of the market and very much focused on being a bigger part of that market through both M&A and organic opportunity. And Shanker will talk you through some of the initiatives. Thank you, Chris. So in terms of strategic initiatives, one of the things that we want to call out here is our renewables range, where we're very well positioned to take advantage of the energy transition from fossil fuel-based heating solutions to renewable heating solutions. In full-year 2023, our renewables category enjoyed a 60% revenue growth, and in particular, air-source heat pumps, which is a subcategory, delivered very strong momentum with revenue growth of 300% in the year. The point that we make about air-source heat pumps is that the average selling price is GBP 2,800 per unit versus a boiler, which is around about GBP 900 per unit. So ultimately, in the transition, it's going to be very good for our business, and we think we're uniquely positioned to supply the distribution, merchanting, and consumer channels, as this market starts to really take off. One of the reasons why we're uniquely positioned is the fact that suppliers recognize our track record of delivering new products into the market. We've had six new suppliers join the network in full-year 2023. And the other point to call out here is that the products are margin-accretive, and delivered via our existing in-house network. We have made substantial investments in our plumbing and heating division since we've acquired it five years ago, and we are very well placed to take advantage of this growing market. In terms of growth of the market, it's underpinned by government targeting 600,000 installations of renewable products in the heating market by 2028. That's 600,000 per annum, even if this target is not hit and they around 50% of that market, it is still a very large opportunity for our business that we're very well placed to take advantage of. On the next slide, we call out a little bit more in terms of the transition plan. The renewables range transition plan, that's underpinned by the government's announcement of an adjustment to the Clean Heat Market Mechanism. It was originally planned for April 2024, so we pushed back to April 2025. The mechanism incentivizes boiler manufacturers through a levy, and it incentivizes homeowners through a grant to accelerate the transition towards renewable energy sources for U.K. heating. This initiative is expected to increase demand for renewable products, including air-source heat pumps, which is one of the principal products in this area. Unfortunately, the deferment of the Clean Heat Market Mechanism has caused some demand disruption in Q1 of 2024 within our B2B channel. However, we are now seeing restocking activity, and we anticipate that to potentially unwind the disruption of Q1 in Q2. In terms of our consolidation model, we wanted to sort of update our stakeholders that we have a strong track record of acquisitions, with in-house M&A expertise. That's one of our unique points. Most vendors speak to us because everything we do is in-house, and it's bespoke to a particular acquisition, not a cookie-cutter model. We have completed 15 since 2016, and all of these are fully integrated and performing ahead of expectations, indeed delivering a 25% return on investment. In many cases or most cases, management teams are retained and incentivized to perform, and we have many case studies of this. We still seek significant opportunities to accelerate consolidation. The targets are selected on their ability to enhance our geographic footprint or our product range or add to our existing e-commerce platform. Ever since the IPO, we've always maintained discipline, and that is that we're targeting acquisitions on a 4-6x maintainable EBITDA. The pipeline of opportunities remains very active. However, we exercise prudence given the current macroeconomic conditions. In terms of ESG, we've been working really hard to develop our strategy. Initially, we developed the strategy in full-year 2022, which provided an effective framework to drive our ESG performance. In 2023, we've implemented a new environmental policy outlining our ambition to reduce our Scope 1 and Scope 2 emissions by 90% by 2035. Scope 1 and Scope 2 is the emissions that the business generates through its operations. And slightly more harder, Scope 3, we have committed to reduce our emissions by 2050 by, again, 90%. A great amount of work has been done in revising our supplier code of conduct policies with mandated compliance that make sure that we perform to the regulatory obligations we have against areas such as anti-slavery or modern slavery, as it's known. We're very proud of our foundation, the Lords Group Foundation. We've distributed GBP 123,000 out of the GBP 200,000 that we committed annually to the foundation for good causes. It focuses on good causes within our local communities. We've always maintained that we're a local business with local leaders running these businesses, and we believe firmly in giving back to the local communities where our customers live or trade from. Finally, we're also very proud of the fact that, despite being an entrepreneurial business, our professionalism has shown through and been recognized by being shortlisted for the Corporate Governance Award at the AIM Awards in 2023. We wanted to also reiterate the Lords' investment case. I'm not going to go through each bullet point on this page, but we reaffirm that we are a leading high-growth distributor of building materials in the UK. There's six key reasons why we believe in our investment case. First, we are a customer unique customer-first proposition. You know, customer service excellence is a central pillar of our strategy. We do this through engaged colleagues, which is a fundamental differentiation in customer service. We have specialist, highly recognizable brands, local and regional leadership, and all of this creates long-term customer relationships. Many of our colleagues are aligned with the success of the group through their own ability to purchase shares in the business. We have substantial organic and margin-accretive growth opportunities in either new markets or accelerating our digital capability. We have opportunities in increasing the share of customer wallet through new products. And as I've just mentioned, the decarbonization of the UK heating market provides us margin expansion. We're well positioned in the UK RMI market by being small at less than 1% of a highly fragmented and resilient market. 45% of our revenues is from the repair sector. I've talked a little bit about our RMI. That's another strong pillar. Chris has mentioned about our balance sheet, which is still strong, and our intention to enhance our EBITDA margin to 7.5%. And finally, not only at exec leadership, but right throughout our business, we have a tremendous track record. Many of our colleagues are recognized as industry leaders, and we're aligned with shareholders by a significant majority shareholding of the exec team. Over to you, Gary, with the outlook and summary. Okay. Well, thank you, Shanker. Chris, I'll start off, actually, by congratulating you both and the whole team for a rising, producing a really good set of results in very difficult circumstances. Now, having talked about difficult circumstances, that probably takes me on to outlook. The fact is, it is difficult circumstances. We've seen this at the macroeconomic environment we're living in. We would never have perceived the interest rates to be at the rates they are with all the geopolitical issues we've got worldwide as well, unfortunately. But against that, we have obviously outperformed our peers within the sector. We've been very pleased with the results, and that is what we would continue to do. We've highlighted several points on this slide, down below. I'm not going to repeat them. It's things that Shanker and Chris have both covered. But the key thing is we will continue to, I think, perform well against the market, and we are certainly trading at the moment in line with market expectations. We would look forward and hope that, well, it's sunny outside today. We're hoping it's going to continue sunny and that things will start to improve after a very difficult nine months. I'll pass it across to Chris, who's going to manage Q&As. Thanks, Gary. Okay. Thank you. We've got some questions that have come through, so I'll read them out, one by one. We'll start with a question from Michael Jay, maybe for Shanker. Are you pleased with the full-year results, or do they feel disappointing overall? I think we're pleased with the results given the economic backdrop and the fact that the economic backdrop changed quite rapidly in the second half of last year. But equally, you know, when the business goes backwards, it is disappointing. Nobody, certainly in management, should ever feel that a regression is to be celebrated. I think it's in context of the market where we feel that we've performed as well as we can. But we are not agnostic to the market and, in particular, the severity of the macroeconomic decline that the U.K. has seen over a very short but rapid period. So in light of that, we're pleased, but at the same time, we're not going to be complacent by being pleased. We recognize that a step back is in all intents and purposes a step back and we will work hard to ensure that we grow our business and grow our profitability moving forward. Okay. As a second one from Michael Jay, and the question is around the projected year-end target versus the GBP 500 million revenue. I could probably start with this. So, through the website, there is access to the latest research consensus. It's below GBP 500 million. It sits at about GBP 560 million. So projected miss against the GBP 500 million. I think the point to say there is that was a target set at the beginning of 2021 in a very different environment. And while we have the opportunities to take us over the line to the GBP 500 million, we want to exercise prudence. You'll see in the exceptional items for 2023 that there's a bout of acquisition costs. We had 2 transactions that were very well advanced, close to completion in H2, and we took the decision to postpone or halt those discussions, because we've always said, as Shanker covered a while ago, 4-6 times maintainable, and the only thing you can't change about an acquisition is the price you pay for it. So we want to exercise that discipline and not lurch for the GBP 500 million for the sake of it at target. I think Chris, just to add to that, you saw in the slide our 10-year sales CAGR, and therefore, it just goes to show that actually over a medium term, we will certainly achieve our stated objectives. But we have to be mindful of the ever-changing backdrop from 2021 when we made that statement. We've got a couple from Maxime W, so cover those. What drove the profitability decline, and when do you expect to return to historic levels and mid-term target? So I think we've probably covered that largely, but just to summarize, in merchanting, you have product deflation in key categories, predominantly timber and metals, overhead inflation, and the absorption of Alloway as a loss-making business at the time we bought it, as I said, but with a clear plan to recover over the next 12 months. Historic levels and mid-term targets. Well, mid-term targets are unchanged. As I said a minute ago, the GBP 500 million, it will be achieved. The KDR shows that, as Shanker said. We're less than 1% of the market. We will get to GBP 500 million, but we're not going to force ourselves through by bloating the business through acquisitions in this market in 2024. And the second question from Maxime is, why was there an EBITDA margin step back as boiler availability normalized if the shortage of boilers is going away? Shouldn't investors expect improvement in the margin here? So particularly on the margin, again, I think it goes back to, actually, our if our gross margins have improved year-on-year, and we're pleased with that, although an element of it is channel mix and segment mix. But I think what I would say is, the boiler availability position last year actually made price a secondary consideration because when people when boilers were short, customers were more interested in availability than price. That's clearly normalized this year as supply's normalized. So combine that with in plumbing and heating, the overhead inflation, and that's why you're getting that EBITDA margin step back. I've made the point at post-IPO that the overall margins have still shown progression, and in an operationally leveraged business, as I said a while ago, it will rebound back with volume. Right. Question from James H. Do you sell and fit solar panels? No, we don't. But it is an area that we will look at. I'm not sure about fitting, but as a group, we've not been involved in providing any construction or installation service. But in terms of solar supply, that is certainly something that is part of our roadmap of product expansion. Okay. A question from Gary B. Lovely. Lovely. Lords has continued its expansion through acquisitions. How have the recent acquisitions of Chilton Timber and Alloway Timber contributed to the revenue and margin profile of the group? Can you elaborate on the integration process and any synergies realized so far? So perhaps if I talk about the revenue and margin, and then I'll let Shanker talk about the synergies. So revenue, we believe I mean, Chilton Timber, the rationale for that was specialist timber range that sits very neatly from a geographical perspective, so it allows cross-sell into our existing customer base. So the rationale there is cross-sell. We bought the business at the bottom end of our 4-6x EBITDA multiple range as well. I think that integration has gone well. So it's what we mean by integration is it's fully integrated and hived into our core limited entity on our single ERP system for merchanting and is now being run by our management team to realize those synergies. And I think actually Chilton Timber had a record-ever trading month in April. So a good example of how that cross-sell opportunity is flowing through. Revenue is relatively modest, but it's the cross-sell opportunity. Alloway Timber, we bought that business on a run rate of GBP 12 million. Our ambition is to take that towards and beyond GBP 20 million over time. We've got a track record of doing that. So where Shanker's talking about 25% return on investment in our 13 acquisitions, I think four of those have similar profiles to Alloway. Insofar as their performance, they've all come through and come good through the Lords proposition being applied and some investment in people, climate, premises. In terms of margin, they should both ultimately reach the blended average of merchanting. There's nothing to differentiate them in terms of their performance. But clearly at the moment, particularly Alloway, is diluted to EBITDA and EBITDA margin. Okay. In terms of the integration process and synergies realized so far, Chris has mentioned in terms of synergies, we've seen Chilton Timber show a record April. The integration is around the product side itself through our network, allowing our existing network new specialist opportunities. And the integration process, it's never easy. Acquiring businesses is not for the faint-hearted. It's always something that we are very, you know, mindful of, and we take our time in trying to win the hearts and minds of the new colleagues. But the way we work that through is by investing in these businesses. Both the businesses that have been acquired have had substantial support and investment. And then Alloway, in particular, all but one of the outlets has been refurbished, and the refurbishment program's coming to a phase one closure, and then we will reevaluate and provide further investment, which will then in turn lead to that return of the performance. So having done this at least 15 times since 2016, we apply our same model, being very focused on integrating the customers. But first, we want to integrate the colleagues, and it's through them that we'll find the performance starts to pick up alongside our investment in what we call our three P's, our people, plant, and premises. Okay. Right. Question from Stephen K. What performance metrics does Lords use to assess the success of new store openings, and how long does it typically take for new stores to reach profitability? Yeah. Yeah. So, the model here is, we talk consistently about wanting a 20% return on our investments. So that's what internally, that's the hurdle that we set, and that's the bar that divisional management teams have to reach. So that's what good performance looks like in terms of how long it takes to reach profitability. We, you know, we're trying. The trick is to say the obvious, really, is to make the losses as small as possible in year one and then drive it to break even, early into year two. And that's typically how we drive that performance because we're not only focused on the return. We want the payback. So the smaller the loss at the beginning and the quicker returns, obviously, the quicker the payback flows through. and so our teams are very focused on trying to refine the model. There's a lot of that work going on in Mr. Central Heating around the CapEx that is required to open one of those. The stock that we need to hold can make a material difference to the return. Okay. And then. Last question? Yeah. Final question unless any more come through. One for Shanker, I think. Is there any overlap between your business and that of Brickability? Do you regard them as a serious competitor? The overlap between our business and Brickability is around the fact that we serve the same customer, but we're in different parts of the chain. We're a stockist. We're a true distributor. So for us, a lot of what we do is around distributing building and heating products. But invariably, we have an overlap in distributing to the same customer. The house building industry is very large. Brickability is predominantly in that section. So we have a common customer, and that's where there are commonalities that if you look at the product ranges, it's complementary, not competitive to each other. Brickability are also a little bit up the supply chain in bricks as a factor. So quite often, we would be trading with them. And again, we have a strong trading relationship with Brickability. So we don't really see them as a serious competitor. They go after a particular part of the market that we don't necessarily concentrate on. Of course, we do overlap from time to time, but not often. Shanker, Chris, Gary, if I may just jump back in there. And thank you very much indeed for addressing all of those questions that came in from investors. And of course, if there are any further questions that do come through, we'll make those available to you immediately after the presentation has ended, just for you to review to then add any additional responses, of course, where it's appropriate to do so. And we'll publish all those responses out on the platform. But Shanker, perhaps before really just looking to redirect those on the call to provide you with their feedback, which I know is particularly important to yourself and the company, if I could please just ask you for a few closing comments to wrap up with, that'd be great. Firstly, I'd like to thank all our colleagues for their great efforts in our resilient performance of 2023. We recognize the step back in our profitability, but we're also very confident about the medium-term opportunities for our business. We've given you a snapshot of all the organic and acquisitive opportunities that we have in our business and the fact that we're very well placed to take advantage of the market as it starts to turn heading into later 2024 and 2025. Thank you all for your attendance, and look forward to seeing you again at our next roadshow. Shanker, that's great. Thank you once again for updating investors, today. Could I please ask investors not to close this session as you'll now be automatically redirected for the opportunity to provide your feedback in order that the management team can really better understand your views and expectations? This will only take a few moments to complete, but I'm sure it'll be greatly valued by the company. On behalf of the management team of Lords Group Trading PLC, we would like to thank you for attending today's presentation. That now concludes today's session. Good afternoon to you all.