Ladies and gentlemen, welcome to the Abcam's Interim Results Conference Call. All participants are currently in listen-only mode. After the presentation, there will be the question and answer session. If you would like to ask a question, please press star and one on your telephone keypad. I must inform you that this call is being recorded. I would now like to hand over to James Tay-wee, Vice President of Investor Relations at Abcam. James, please go ahead. Thank you, Nadia, and welcome everyone to Abcam's conference call for the first six months of fiscal 2021. Before I hand over to Alan, let me briefly cover our safe harbor statement. Some of the comments made during this conference call may be considered forward-looking statements, including beliefs and expectations about the company's future performance, as well as the potential impact of the COVID-19 pandemic on our operations and financial results. These forward-looking statements are subject to risks and uncertainties and are based upon currently available data. The company assumes no obligation to update them. Actual results are subject to future events and uncertainties, which can materially impact the company's actual performance. Please look at the company's recent regulatory filings for a more complete picture of our risks and other factors. During the call, non-IFRS adjusted financial measures may be used to provide information pertinent to ongoing business performance. Tables reconciling these measures to the most comparable IFRS measures are available in the company's press release issued earlier today on the Abcam website at corporate.abcam.com/investors. Now I'd like to turn the call over to Alan. Thank you, James. Good morning and good afternoon, everyone. Michael Baldock and I thank you for joining us today. It is such an extraordinary period in life sciences, and at Abcam, we've got the privilege of seeing the remarkable pace of discoveries and innovation in life science and proteomics. Despite the temporary setbacks of the current environment, we certainly remain confident in the long-term outlook for life science growth as the world funds basic research, adopts new discovery platforms, pursues precision medicine, and continues investment in creating better health globally. Since our last update in September 2020, we've been operating and building our business in line with three themes we discussed back then. First and foremost, we've been providing a safe and engaging environment for our employees globally as they continue to serve customers during the different phases of the COVID-19 pandemic. Second, we've been accelerating innovation and driving durable growth through our 2024 plan and beyond. We've been investing in and building talent and capabilities as a leader in proteomic research tools in spite of the challenges caused by COVID. Third, we've broadened the capital and investor base of Abcam to successfully implement strategy and to help grow this company and its value sustainably over the long term. Today, Michael and I would like to provide an update on three topics where progress has been shaped by those themes, our first half performance, major milestones achieved in our strategy implementation, and COVID's ongoing impact on customer demand and its implications for the business outlook through 2024. Before I get into those topics, I would like to recognize the dedication of our team, over 1,600 colleagues, who've remained and maintained high customer service levels and supported each other through what continues to be a challenging period. With their efforts, we strengthen our business by providing quality products and services to scientists globally who've been depending on Abcam for advancing their life science discovery. Abcam's recognition as one of the top five employers in the U.K. has arisen from our employees' collective efforts in building our company. I thank them for their dedication to our purpose and to our customers who've been depending on Abcam for creating the results that we'll discuss today. Thank you. First half performance. Against the backdrop of the pandemic and the market environment where demand has remained 10%-20% below our expected levels, we were pleased to achieve constant currency revenue growth of over 8% in the first half. We were also pleased to see the positive impact to our focus on customers, with customer transactional Net Promoter Score up seven percentage points year-on-year to 59%. This outcome puts our customer assessment of Abcam quality at all-time highs. Customer demand for our in-house products was particularly strong, with constant currency sales growth of approximately 25%. We observed that scientists sought to maximize efficiency in the lab and bought more of these high-quality and time-saving products, including recombinant antibodies and immunoassays. Our global research and development activity has been busy raising standards for quality and validation over the last few years. This effort differentiates our products, aligns us with the needs of customers, and allows us to deliver on our promise of serving life scientists to achieve their mission faster. In line with our plans, we continue to invest throughout the half in our innovation capabilities, systems and processes, facilities, and people. Our financial position, which was further strengthened by our U.S. listing on Nasdaq last October, provides the foundation to grow the business organically and through further acquisition. I'm now going to talk a few moments about the major milestones that we've achieved in our strategy implementation in the first half. Our aim is to deliver consistent, durable, and profitable growth responsibly. I'm pleased to say we've made progress across all areas of our strategy in the first half. We increased our rate of development and introduced more than 2,500 new recombinant antibody products. This was a significantly higher level of product introduction than in the first half during the prior period in 2020. Although certain product development pipelines have slowed due to our own need to reduce lab capacity across global facilities as a result of COVID-19 restrictions. Our product development continues to focus on some of the hottest research areas, including immuno-oncology, neuroscience, epigenetics, and products to support SARS-CoV-2 research. Products included recombinant antibodies, antibody pairs, SimpleStep ELISA kits, and new formulations that enable faster labeling and assay development. Overall, our portfolio of recombinant antibody and immunoassay products totaled more than 24,000 by the end of the first half. Our work to improve antibody quality continued. Our gene knockout validation program has now been applied to over 3,500 products, and we further validated hundreds of antibodies in new applications to extend their utility for customers. Our cell line portfolio and gene editing platform, which we acquired in 2020, supported these validation programs and are leading to higher throughput antibody selection and stronger validation. In addition to our product innovation, we've also been enhancing our digital marketing and e-commerce capabilities. Our multi-year plans to upgrade our digital platform achieved notable milestones in the first half, with the opening of new digital hubs in Shanghai, China, and Amsterdam that are already bringing improvements to our market. In the other area that I wanted to talk about today, there are a few updates in new product lines and adjacent markets. We have made progress across each of our new product line areas in the first half, including conjugation labeling, recombinant proteins, cell lines, and imaging and multiplexing consumables. We significantly expanded our capabilities through the acquisition of Expedeon last year. This capability addition is allowing us to better serve the growing need for antibody conjugation and imaging in biological testing platforms. We also made further operational and commercial progress with our FirePlex multiplex offering, with the addition of several new biopharma customers and a new high throughput 1536 well plate product launched in January 2021. We completed the build-out of our protein development team during the first half. We are seeing early customer interest in the initial cohort of over 50 high-quality bioactive proteins. Our cell lines portfolio, we introduced our first batch of in-house developed cell lines. Early customer demand for these products is encouraging and includes the extension of our partnership with The Michael J. Fox Foundation to include knock out and knock in cell line development for Parkinson's research. In the area of partnering with Biopharma and Abcam Inside, you will see across the translational research and clinical markets that our goal has been to be a trusted partner to organizations looking to access our products and expertise for their platforms and clinical development programs. In the period, we entered into over 40 new agreements with new and existing partners and commercialized nearly 100 additional antibody clones through co-development programs spanning platform, diagnostic, and pathology partners. In all, over 560 Abcam antibodies are now validated for commercial use in third-party platforms or as diagnostic tools. There are over 2,000 additional antibodies undergoing evaluation by Biopharma partners for similar applications. These programs are enabling more scientists to access our products while also supporting clinical developments that will result in better diagnosis and treatment for patients. The final area on strategy I'm going to provide an update is on building organizational scalability and sustaining value creation. In December 2020, we opened a 16,000 sq ft facility in Fremont, California, to support cell line development and production. Other facility developments that continued in the first half include progress on the construction of a new 100,000 sq ft site in Waltham, Massachusetts, and upgrades and expansions across our operations in Oregon and China. Despite disruption caused by COVID-19, the footprint program remains within a few months of our pre-COVID plans, and we hope to complete all of these facility upgrades during calendar 2021. We are also in the final stage of our ERP implementation, covering manufacturing and supply chain. We're currently going live in multiple production locations. The program remains on track as we moved from the design phase to user testing during the half, with completion expected by the end of 2022. Turning now to the final area, I want to provide an update on our business outlook through 2024. To reiterate what I said at the start of the call, the fundamental drivers of life science research and its market remain attractive, with stable public funding and an increased emphasis on proteomics and clinically relevant biologics. The long-term trends for our market are positive. The short-term remains uncertain. In markets where working in the lab is unconstrained by COVID, we are seeing high demand growth. These markets and customers are offering plenty of proof points to us that the prospects are good for Abcam to achieve long-term and durable growth. Through December of last year, COVID-19 health and safety controls were still constraining researcher access to nearly 60% of labs globally. These constraints limited and continue to limit scientific discovery capacity. We observed demand in those labs was well below historic levels. This dynamic is particularly true within academic labs in the United States, Canada, and here in the U.K. Against this market backdrop, implementation of our strategy remains within the board's expectations for timing, costs, and milestones in the context of a five-year period of our plan. We remain confident in realizing growth from our investments and generating an attractive return on capital employed as we gain operational leverage, normalize capital investment, and generate more of our own product at high gross margins over the next few years. With over 15 months of operational experience throughout the pandemic, we now have learned to be more cautious in our assessment of when laboratory activity and demand will return to full strength. As we look ahead to the remainder of 2021, we're optimistic about vaccination and the relaxation of controls, leading to a path to a return to full activity in our customers' labs. Choosing the exact timing is not a certainty, though, and we expect the rate of demand growth will remain uncertain throughout this calendar year. With the uncertainty of pandemic impact on demand in mind, we believe the long-term outlook to 2024 for Abcam has a broader range of potential outcomes than those we proposed in 2019. Our latest view of the range of revenue that can be generated by the business by the end of calendar 2024 is GBP 425 million-GBP 500 million revenue. When laboratory activity and demand return to normal levels, we expect to provide additional feedback and updates to the market. I'll now hand over to Michael, who'll provide further financial detail from half one. Michael. Thank you, Alan. Good morning, good afternoon to everyone. I'm going to spend a few minutes talking about our financial performance during the first six months. Then, we'll have some time for questions if you'd like. We're pleased to have returned to top-line growth in the period against a backdrop of continued COVID-19 disruption. At the same time, we continue to invest significantly in our long-term growth strategy. Revenue on a reported basis was GBP 147.5 million, up 6.7% after a foreign exchange headwind of around 1.6%, predominantly due to the appreciation of the sterling against the dollar. On a constant currency basis, revenue increased 8.3% over the same period last year. As you know, sterling has continued to appreciate against the dollar and other major currencies in 2021. If the current rates prevail for the remainder of our second half, it will represent a greater headwind to reported top-line growth in the second half of around 5%, with approximately 30%-40% of that impact expected to flow through to the bottom line after hedging. Our gross margin for the period increased by 120 basis points to 70.9%, predominantly due to increased sales from our in-house products. We expect our gross margin to improve further as a proportion of revenue generated from our in-house products continues to grow. After continuing to invest in our long-term growth plan, our adjusted operating profit for the half was GBP 23.6 million, an adjusted operating margin of 16%. As Alan said, the major component of this investment is in our team. Our headcount grew 23% year-on-year to around 1,600 people, with around 100 net new hires in the first half alone. We currently anticipate adding approximately the same number of people in the second six months as we continue to invest. This would give us a net headcount increase of about 200 people for the 12 months. While this increase is still meaningful growth, it has slowed significantly from last year when we added approximately 350 net new people. You'll remember 85 of which came from acquisitions. Our adjusted fully diluted earnings per share was GBP 0.081, reflecting both the decrease in earnings and an increase in share count resulting from the 5% share placing in our Nasdaq listing in the U.S. The group continues to be highly cash generative, with cash generated from operating activities of GBP 33.9 million. This, together with the net proceeds of approximately GBP 126.5 million from our U.S. share placing, means we ended the period with a net cash position of over GBP 211 million, providing significant capital flexibility to deploy into our growth plans, including potential acquisitions. I'll now give you a more detailed breakdown of revenues during the first half. As Alan mentioned, catalog revenue, which accounts for about 94% of the total, was up 6.4% on a reported basis and 7.8% on a constant currency basis. As I've mentioned, this was particularly pleasing given the reduced lab capacity during the period. Additionally, as part of our ongoing drive to improve the quality of our catalog, we delisted a number of third-party products which had contributed approximately GBP 4 million of revenue in the first half of the prior year. The first half also benefited from approximately GBP 6 million of revenue from Expedeon, which we did not have in the first half of the prior year. Demand was once again strong for our highly validated recombinant antibody products, which continue to gain traction with academic, pharma, and biotech customers, as well as our growing range of rapid and high-performance SimpleStep ELISA kits. We also saw encouraging early interest and demand for our newer product lines, including conjugation kits, bioactive proteins, and engineered cell lines. Overall, in-house product revenues on the catalog increased by 25.6% on a constant currency basis and comprised 53% of catalog revenue, up from 45% last year. Including CP&L revenue, total revenue from in-house products and services increased by approximately 25% on a constant currency basis and represented over 55% of total revenue. The strong demand for these products reinforces the underlying basis for our organic growth strategy. The performance of all regions improved in the period overall, though revenue trends continued to correlate to policy actions taken by governments and organizations from around the world in response to the spread of the virus and the resulting partial or full shutdowns and subsequent reopening of academic and biopharmaceutical research laboratories. This phenomenon meant that the Americas region continued to lag the rest of the world, with growth of only 0.8%. All other major regions fared better, with EMEA and China performing particularly well. China grew over 15%, and EMEA, which saw the greatest contribution from Expedeon, grew 12.4%. Moving to our CP&L line, which comprises our custom services, revenue from the supply of products for in vitro diagnostic use, neurology and licensing income from in-house products and IP, including milestone payments. CP&L grew 15.9% overall at constant exchange rates. Within CP&L, we had strong growth in revenue from supply of products for IVD use, with revenue up over 90%. As you may recall, we had experienced delays at certain customer orders in fiscal 2020, and so part of this extraordinary growth was a normalization of customer order flows. We continued to build long-term relationships with our major IVD customers and remain confident of further growth from this area of the business. We also had good growth in income from royalties and licenses, which increased by 15.6% at constant currency rates, demonstrating the downstream benefits of our efforts in this area over the last few years. We experienced lower activity in our customer services business in the period due to COVID-19, resulting in a 16.7% decline in revenue. Now let's turn to investments that drive our top-line growth. In late 2019, we set out our five-year plan to invest in the business to accelerate and sustain our growth. This investment plan spans a broad range of areas, including product innovation and R&D, digital capabilities, supply chain and manufacturing capacity, and our customer and commercial teams. This continued investment is reflected in our adjusted operating costs of just over GBP 80 million in the period, a 29% increase on the prior year. The figure includes GBP 18.3 million of non-cash costs, comprising GBP 11 million of adjusted depreciation and amortization, and GBP 7.3 million of share-based compensation. The majority of the underlying increase is attributable to the increase in headcount that I mentioned previously. Within total costs, adjusted R&D spending increased 54%, including capitalized innovation. Our total R&D investment as a percent of our in-house sales was approximately 20%, reflecting the importance we place on product innovation and development to our growth strategy. As you'll recall, last year, we invested approximately GBP 120 million on a range of acquisitions and external investments. Those businesses and teams are now fully integrated, and we are now focused on delivering benefits from the technologies and products they brought us. It's still very early days, but we're certainly excited about their ability to support our innovation rate and growth potential. Turning to cash flow, we continue to be highly cash generative, with GBP 33.7 million of cash from operations after working capital movements in the period. After taxes paid and an increase in net capital expenditure, our free cash flow was GBP 6.6 million. Net cash outflow from investing activities was GBP 22.8 million, predominantly comprising capital expenditure of GBP 25.1 million. This is in line with our expectation of around GBP 50 million-GBP 60 million of CapEx for the 12-month period as we move through what we expect to be the heaviest year of capital investment in the plan. CapEx includes GBP 8.5 million in respect of global footprint developments as we expand, enhance, and fit out our global operations to support our in-house development capabilities, particularly proteins and cell lines. We also spent around GBP 8 million on IT programs in the year, and the majority of which was on our ERP, and GBP 4.5 million of internally developed technology relating to new in-house products. Moving to financing activities, net cash inflow from activities totaled GBP 15 million, with net proceeds of GBP 126.5 million from issuing new shares in our Nasdaq listing in October 2020, partially offset by the full repayment of the group's revolving credit facility of GBP 107 million and other outflows of GBP 5 million. We were delighted with the response to our U.S. listing in October, which was strongly supported by both our existing and new shareholders. The group ended the period with a net cash position of over GBP 211 million and an undrawn revolving credit facility of GBP 200 million, the term of which has been extended to early 2024. Our capital allocation strategy remains unchanged. We see significant further opportunities for profitable growth and attractive returns on investment and believe that the best way to maximize shareholder value over the long term is to maintain our flexibility to invest in opportunities as they arise. On the M&A front, the market for deals remains open despite COVID, and we remain actively focused on developing a pipeline of opportunities that meet our acquisition criteria. Finally, as mentioned in the release, we intend to change the company's year-end from June to December. This means our current fiscal year will be extended to an 18-month period ending December 31st. This change shouldn't materially change the cadence of our market communications. We'll provide a sales update in early July with a full earnings release in September, which will cover both the six month and 12-month periods ending June 30th. In March 2022, we'll report both the 12 months and 18 months ending December 31st. Full details of the new reporting calendar are in the release. It should hopefully be relatively straightforward change for you for modeling purposes. I'm happy to take any questions on this if there are any later. So, in summary, despite everything that's going on in the world and the higher levels of uncertainty that we operate in, these remain exciting times at Abcam. We continue to invest in the business and remain focused on delivering our goals in order to build a stronger, more sustainable global business, deliver longer-term durable and profitable revenue growth, and generate value for stakeholders. With that, thank you very much for listening, and we'll turn it over to the operator for questions. Thank you. Ladies and gentlemen, we'll now begin the question and answer session. As a reminder, if you wish to ask a question, please press star and one on your telephone keypad and wait for your name to be announces. The first question comes from line of Tejas Savant from Morgan Stanley. Please ask your question. Hey, guys. Good afternoon. Thanks for the time today. Alan, just one quick one here for you on the guide and the comments you made about 60% labs operating below capacity as of year-end. Since then, for a lot of your peers, things seem to have gotten sequentially better month-over-month in terms of the resurgence numbers going down as well as vaccinations ticking up. How does that number look for you today, and are you still seeing this clear divergence between the Americas and Europe? No, thanks, Tejas. Obviously, it's tricky to get precise data, but our own surveying and discussions with customers lead us to believe that the U.S., U.K., and Canadian academic markets in particular remain challenging. There's no letup yet in social distancing and how they're having to schedule labs. The answer, exactly what's going on in facilities differs wildly depending on which institute you're talking to. Some organizations like Cornell University, for example, have been on top of extensive testing. They've been able to keep labs open a lot more actively than some others. Net-net, certainly there are enough stories and feedback about PIs saying to their graduate students, "Start extending your time horizon. We've lost up to one year this year." Those conversations are ongoing, even with the extension and grants and other things. So, our view is that we're still in the tricky part, particularly as schools have been locked down. That's put additional strain on graduate students and postdocs and PIs with children, and we don't see any letting up, really, of any significant amount in those markets yet. Biopharma's picked up quite a bit more. Certainly, the story there is slightly different. Obviously, in markets like China, things are totally back to normal. Got it. Very helpful. It's also worth mentioning, I think, too, I think something Alan mentioned earlier. I mean, one of the issues is also in the U.S. particularly, is immigration visas. It's anecdotal, but Memorial Sloan Kettering is down 100 researchers from China that couldn't get visas to come back and haven't been able to get back yet. There are a lot of things driving the variation in the numbers, particularly in the U.S. Got it. That's helpful, Michael. Then, one quick follow-up on the long-term guide. Can you just outline, there's a pretty modest decrease at the midpoint here. How much of that was just the FX expectations getting a little bit worse versus November 2019, versus this slightly prolonged COVID overhang here? Michael, one for you on the same note. In light of this broader range, can you provide some color on just margin expectations at the low end versus the high end of the GBP 425 million-GBP 500 million top-line range? The adjustment in widening is primarily a reflection of the uncertainties around the COVID demand curve that we've just been talking about. In these next 12 months to 18 months, depending on which scenario we are in for people getting back in the labs, it can shift the kind of revenue curve to one end or the other of that range pretty quickly. We just have to acknowledge it's quite difficult to call at the moment, and that's why we've broadened it. We tend to think of these targets much more in terms of constant currency than trying to adjust for any short-term currency adjustments. Yeah, on the margin front, I guess, Tejas, the reason we didn't give any incremental guidance is we're just finding it quite hard to call things from a short-term timing perspective. We're still very confident. Well, two things. One is, as you know, we're continuing to spend, and we added 100 people in the first half. We'll add another 100 in the second half. But you can see that our increase in spending, and by the way, 77% of our costs are comp and benefits. While we're still growing and increasing spending and investment, it is slowing. We're fairly confident on the timing of our speed and investment. What we're not so confident on is how that relates over the next short period to revenues and what the exact implications for margins. Longer term, we're still very comfortable that this business, lacking incremental investment, it very easily delivers an adjusted operating margin of in the low 30s. The timing of that is just less certain, both from a COVID perspective and an investment perspective. Comfortable that we can get there, particularly at the higher end of that range, if we so desire and if our investment in growth were to come down some. Got it. Very helpful, guys. Thanks. Thank you. The next question comes from line of Charles Weston from RBC. Please ask your question. Hi. Thanks for taking my questions. I have two. One is also on the guidance, and one is on Expedeon. In terms of the guidance, I just wanted to better understand the period to which the range relates. I was under the impression that the GBP 450 million to GBP 500 million related to the June year-end for 2024. I think you used the phrase, "by the end of calendar 2024." I just wanted to know, does this now relate to calendar 2024, or does it relate to an annualizing number at the end of 2024? My second question, please, relates to Expedeon. Clearly, it's growing very nicely and seems to be an example of you leveraging your distribution network for new products. Can you give us some additional color here in terms of the increase in number of customers for Expedeon products, the penetration of your existing customer base, anything like that? Sure. First, let's talk about timing, Charles. As we know, we're changing our fiscal year-end to calendar year-end. You're quite right. That in the guidance, we said that we've widened guidance to GBP 425 million-GBP 500 million of revenue by the end of FY 2024, which will be calendar 2024. On the second point, which is Expedeon, and maybe Alan can talk about a little more. Look, it's quite hard because we fully integrated Expedeon now into the business. Certainly, the increase in revenue has been pushing incremental conjugation kits and ELISA kits and having incremental assets for our immunoassays that has contributed to that revenue growth. You remember we had last half, it was GBP 5 million in the last half, GBP 4 million when we bought it. It's going up at a fairly rapid rate, and that is largely in Europe. So we also believe that as COVID passes by and we increase our penetration in the U.S., that will go up quite significantly. We're really happy with that as a business. We won't be breaking it out much in the future because it literally is integrated now fully. Understood. Just to go back onto the margin point for that range, I think you mentioned, "It can be achievable if we so desire." Should we interpret that as saying on the current spending plan, that that 30% is going to be achieved at the higher end of your revenue guidance? If you were to step up investment again, are you likely to be telling the market first or just carrying on spending and sort of telling us post hoc? Well, Charles, as you know, you don't run a company from at chunks of five years. It's an evolution. Like we do now, we will continue to have conversation with both analysts and shareholders as to our growth plans. We think as long as we continue to see opportunities to drive growth, we'll invest in those. That doesn't mean we'll be investing at current levels, but we certainly will continue to invest if we can drive growth. If we're not increasing our investment to drive growth, we think we're easily in the low 30s. That could vary depending on the level of investment and the opportunities we see to grow in. Makes sense. Thank you. Thank you. The next question comes from line of Puneet Souda from SVB Leerink. Please ask your question. Hi, Alan and Michael. Thanks for the questions. First one on the guide, I totally appreciate this is an uncertain environment still, but I wanted to get a better understanding of the recovery that you're seeing across both antibodies and the new kits and the new products introduction that you're seeing. Obviously, you're seeing strong growth there in in-house products year-over-year. I'm still a little bit surprised about the 60% comment that you made, because when we look at your product lineup, it's largely consumables and antibodies, versus we're hearing from your peer groups that are more instrument heavy, they're recovering strongly across their labs, and they appear to have better than 60% access. So, I just want to frame that comment, and I just want to get a better understanding of is there anything else that in certain geographies that we're missing or we need to account for in the consumable access? Because I would've supposed that those should have been adopted sooner than later or recovered sooner than later. As I said, Puneet, thanks for the question. Trying to get to exactly what's going on is tricky business. I can tell you, for example, here in the U.K., when we survey lab activities, only 25% of labs would say they're at full activity here in the United Kingdom. It does vary quite a lot. Therefore, depending on your mix of customer types and geographies, you can get a different answer. Then within that, too, I think what we're hearing is some labs have expiring grants, and they're using those expiring grants in the absence of being able to do work and buy consumables to buy other things that will advance the research later. That might be benefiting some of our other participants in the life marketplace for that equipment. But, part of the reason why we've widened the range here is we have not seen in the United States, U.K., and Canada, as I mentioned earlier, anything that suggests that the markets in the academic side are strengthening and improving. What I think I mentioned when I spoke to the January trading update remains a concern, which is there was a little blip in the summer in the academic buying where it looked like the U.S. in particular was kind of optimistically getting back to work. We've not seen a strengthening since then. Okay, got it. In terms of proteomics, can you just remind us your exposure there with antibodies and proteins at this point in time? We obviously seen an increased level of interest in proteomics. We have seen new company creation and more investments happening in the space. Yeah. Could you talk maybe broadly about how Abcam is positioned here in proteomics longer term and within the context of this long-term guide as well? It's a tremendously exciting period of innovation in proteomics and the approach to high throughput protein sequencing or identification quantification. So I agree with you, there's lots going on. The way Abcam participates is, and the way we think about it is twofold. Both are good for us. The first is where there are proteomic platforms that require antibodies or proteins or conjugation chemistry as well, we're really well positioned with all of those platform partners to provide them with content as they go forward, and we're very actively doing so already. Our thesis, I think, is that as more proteins are understood more widely and spatially in their tissue and what their regulation is, ultimately, from these very large screens or identification workflows that are being forwarded by all of these companies that are out there, ultimately, you still need to do the work of getting down to a single protein characterization. For that, you also need antibodies and other consumables that we sell. We think about what can we learn from the genomics period, that the massive amounts of sequencing didn't substitute out the need to look at proteins, rather raised more questions to where protein characterization was important. We believe the same will be true in the proteomics explosion. By providing content to those proteomics platforms and the tools required to look at individual proteins, we think we're pretty well positioned for growth on the back of that trend. Okay, great. Thank you. Thank you. The next question comes through line of James Gordon from J.P. Morgan. Please ask your question. Hello, James Gordon from J.P. Morgan. Thanks for taking the questions. First question was just on H2. Hopefully we're going to see further improvements in terms of COVID-19. Are there any activities at Abcam that could also normalize or step up that would put upward pressure on the second half OpEx? I also heard the commentary about further headcount increases. So, would it be fair to assume we're going to see sequential margin contraction, and how much margin contraction might we see in the second half? That would be the first question, please. Second one was just the tax rate. I noted the comments in the release about the U.K. corporate tax rate going up, but I know company tax rates aren't just determined by the country that they're domiciled in. What is the sensitivity, say, for every one percentage point move in the U.K. tax rate, if it does actually end up going up as much as being currently planned, what does that actually do to Abcam, please? Okay. Well, why don't I take the margin question first. I guess we've specifically not given margin guidance because of the uncertainty of what's happening right now. But I think you can safely assume that we are going to continue to invest over this year, as we've said, and certainly by adding an extra 100 people in the second half, that investment will come through the P&L. We also, as you remember, as we currently see things right now, our second half is usually stronger than our first half. Assuming that we don't hit blips from COVID, we're currently hoping that that is a trend that continues. Those two things combined will give you the ultimate margin for the second half and for the year. Given what's going on with COVID, we're just not willing to guess what that is right now. I think you can make some assumptions on what we've said in our investment and look at what we've done over the past few years and look at the rate of increase in headcount, what that means, and draw your own conclusions. On the tax rate, as you know, the government announced it last week. Our current tax rate was something between 17% and 18%, so was slightly below than the current rate. It really depends on a number of factors, particularly given what happens in the U.S. A lot of our profits, a lot of our revenues are in the U.S., and maybe that the U.S. tax rate goes up. We haven't actually said right now and actually dug into where we think our tax rate could ultimately end up. We certainly know it's going to go higher. Thank you. Thank you. The next question comes from line of Stefan Hamill from Numis. Please ask your question. Hi, folks. Just one further one, I think I understand where you're going on the timing of your midterm targets and the margin ambitions there. Just interested in the OEM trends that you saw in the first half. You saw sort of GBP 6 million Decrease of which 2/3 seem to be active delisting. Have you just analyzed how many of those binders and targets were replaced by in-house products, and how many lost to competitors, and can you drive further growth of in-house in this way? Yeah. It's Alan. Go ahead, Alan. Yeah. Sorry, Michael, I'll take this one. Stefan, first off, you're right, that most of the effect was active delisting by us, and this was one of the bigger periods of doing that. When we sort of dig into what's really going on underlying demand with the remaining bit, the reality is that for us anyway, early discovery research, particularly that done by academic labs, tends to look at a much wider variety of small volume purchases from Abcam and really takes advantage of the breadth of our catalog much more so than people who are later stages, like Biopharma or academic accounts that are more in translational work. The fact that a lot of those labs are at reduced capacity has had an unusually high impact on the OEM source side, where we've got a wider variety of small volume purchases and products. What we've seen is a contraction in demand for that kind of exploratory fringe or breadth of buying in academic customers. We'd expect that to come back when those kinds of behaviors and customers return. I get it. Have you sort of analyzed, of the targets, binders, et cetera, delisted, how many you've been able to sort of capture otherwise? About half. Yeah, we're pretty good at that. We usually don't delist unless we're confident we're going to have a path to getting it back. That's as much as a question about timing as it is about ambition. Got you. Thank you. Just one very quickly on China. I noticed you opened a new facility in Shanghai. Is there any sort of change in the sales model in China at all? So are we going more direct there? We're certainly in China aiming to make it easier for customers to get support and help from Abcam and trying to work through the natural grain of distribution there, but also provide direct customer contact. That facility has been working on that, both digitally through a bunch of improvements on WeChat, as well as physical contact. Got you. Thank you. Thank you. The next question comes from line of Matt LaRue from William Blair. Please ask your question. Hi, good morning. Good afternoon, I suppose. Just wanted to ask in terms of head count, excluding any additional M&A, should we think about sort of SG&A as a percentage of sales having hit the higher watermark? What might we start thinking about head count, again, ex M&A, in fiscal year 2022? Excluding M&A, as we've said pretty consistently, as long as we're investing in the growth, our largest cost and our largest investment is going to be people. It's certainly slowing down. We don't anticipate that it continues to grow at this level. Will it continue to increase some over time even when we slow down on our investment? I think the question is absolutely. We don't have a target number. But I think that by the time we get to the end of this year at about, we should be around, what, 1,700 people, that the growth in that number is going to slow fairly substantially short of investment in incremental new things or bringing on acquisitions. We will continue to invest, particularly as we're able to drive our growth in new products and spread some of these technologies across our platform. If you look at what we're able to do right now with conjugation and the speeding technology, the more demand we see for that, the more people we'll add to continue to drive that growth. I'd just add, Michael, that you just have to put where we are in our overall plan. We launched the plan in 2019. We always believed that these first couple of years were going to be installing a lot of new capabilities and kind of building new muscles and bringing in new teams in order to drive more growth through antibodies and related products and capabilities from that. We're still in this period where we're putting our foot on the accelerator to accelerate the top line in the next few years. When we talk about being within kind of board expectations of timing and milestones, this was always the plan. If anything, we moved more quickly in getting people in place and some of these investments made than we had originally anticipated. Equally, we expect to see top line growth out of these and expansion of margins over time from that activity. Sure. Then with a number of the markets that are still challenging for you now kind of ramping up vaccination distribution, it might be helpful just to hear what the pace of recovery looked like in markets that are fully back today. You highlighted China and EMEA. Once they started recovering, just how quickly they came back, understanding each market is different, but maybe just to give us a sense for how the ramp back up might look in the U.S. and U.K. Well, it's a matter of degree. I mean, where we saw markets go quickly to unconstrained access to labs, no social distancing, no planned time slots, all those kind of things, you nearly instantly get back to full demand. Perversely, in the U.S., we had a little snapshot of that and what it looked like in July. It was almost back to normal there for a bit. Then we've seen markets go backwards from that. You've certainly seen market go backwards in Germany. Japan has pulled back a bit from where it was, as it had the outbreak in Tokyo and the related prefectures, in January and February. I guess the complexity of dealing with COVID is that apart from China, we've not seen a market where it went through lockdown and then reemergence, and it was all one shift. We've seen ebbs and flows of different policy changes and rising the activity and reducing the activity throughout, and particularly here in the U.K., that's been true. I guess we're not only looking for a return to activity, we're looking for consistency and no more waves. Once we see that, demand snaps very quickly. I think that's all I can say about that. Yep. Okay. I guess the last one, but maybe it's a difficult time to track market share dynamics. Based on the metrics that you track and rely on, you know, I just wanted to get a sense for how you think your share has trended now annualizing one year with COVID. It is really difficult, because I'd need to know what happened to. Yeah Everybody else. Our sense is because of the growth of more than half of our portfolio that's of our own making is so high, and that that's attracting much more clinically demanding translational types of customers, whether they're in academia or in biopharma. We're really gaining share there because we can see the traction. What's hard to measure is the early discovery academic end and early discovery in Biopharma, where things have been a bit more constrained, and I just can't call it there. My expectation would be everything we're doing in terms of building quality of product portfolio and data insights about where market needs are and building differentiated products, that's steaming growth. I don't think we could've grown first half 8% if we weren't gaining share. Yep. Okay. Thanks, Alan. Thank you. The next question comes through the line of Michael Ryskin from Bank of America. Please ask your question. Hey, thanks. Thanks for taking my question. I want to go back to your comments on delisting some of the third-party products. How should we think about that going forward? I mean, obviously the mix of the company has shifted over time, both through the faster performance of the in-house catalog, and also some of these steps, but you still have a substantial OEM catalog. Are you looking to accelerate the pace of that delisting? Just sort of how should we think about that drawdown in the second half and going forward? That delisting was a continuation of an activity that we've been doing for the last four years or five years, but it was significantly larger than any of the ones we'd undertaken before. It was fundamentally two suppliers whose customer feedback was not up to our standards. They were unable to address some of the quality and consistency concerns, and we chose to delist those once we could identify what alternatives we had. Our feedback to our suppliers is, if you're providing high-quality products that are highly validated and of the standards that our customers as a whole value with Abcam long-term, that'll be very successful for both of us. If you can't, we're going to find alternatives, and that's kind of where we are today. There's a whole bunch of biological targets out there that we're not going to have the best binder to, and others will, and we're very happy to source those in where we can reach agreement on quality and commercial terms. The reality is, when we're innovating at 2,500+ new molecules a year, there's a lot we can tackle on our own. We'd like to direct most of that to new areas where there aren't any tools available by working with partners like Cancer Research U.K. or MD Anderson or Michael J. Fox Foundation, because that's a lot more interesting for us and for science. I'd love to have our OEM suppliers providing the quality and consistency on those that are more well-known core products and targets so we can stay innovative on the edge. That portfolio management's ongoing. I don't expect that we're going to be doing any major shifts or adjustments, but that's not entirely in our hands. I think customers' expectations of what quality means are evolving. The standards are getting higher, and our suppliers need to keep up with that. Okay, thanks. That's helpful. Going back to the COVID landscape and your thoughts there, I realize there's a lot of uncertainty, and it's hard to make predictions. But could you just give us a sense of what your expectations are internally as you make business plans for the rest of the year? That 60% number operating below capacity, is it fair to say that maybe by the end of this calendar year, you expect that sort of to fade to zero? Just as far as your internal business plan is going, what are your thoughts on the pacing of that? I wish we had a confident answer to that. The things that we're watching for are the return of schools because, as we're here with celebrating International Women's Day, this is one of the rare industries where in life sciences, more than half of PhDs are granted to women. Women, in particular, have been hard hit where they're dealing with childcare at home and trying to have a life sciences career. Yes, we need schools to reopen to get full employment back in labs. We need policies to open back up again to allow full use of labs and not have distancing. We need granting agencies to act sensibly in terms of how they're handling grant expirations on projects that are taking longer. We haven't seen all three of those yet consistently in each of the markets. You can imagine why we're just reluctant to call it. I'm optimistic. Here in the U.K., today's the first day of school, which is great. I understand many U.S. states that's happened already. Certainly, the vaccination program is great, but where the priority is being driven by age rather than type of work, a lot of life science is being done by young people, and it's going to be a while before they're vaccinated. I think when we do our trading update over the summer, we'll certainly have a much better view then. That's probably the right time to talk about it. Okay, thanks. If I could squeeze in one more. You had some comments on M&A and sort of use of cash and use of the U.S. cross listing and sort of your outlook on the market. Can you give us any sense of where we should look? Are you still targeting more of some of these newer verticals, such as peptides, engineered cell lines? Or are there any interesting targets in some of your traditional markets, primary, secondary antibodies? Also, could you remind us of the target criteria, what metrics you're looking for when you pursue assets? Sure. We continue to be very consistent in the areas we're targeting, which is other ways to add to our high-quality antibody portfolio or other adjacencies. You've mentioned some of them. To the extent we can find good assets that have high-quality products that customers like, we're interested in adding them. You've seen what's happened to pricing, particularly as private equity firms have begun to play in our space, we're very disciplined. We are very anxious to and on the lookout for and have quite a good pipeline of assets we're looking at. But we also have to look you all and our shareholders in the eye and tell them that we're doing it at a price which will deliver a good return on capital to them and make sense for the business. We're very optimistic about it. As you know, we've got some capital sitting there, plus an undrawn credit line, and we're optimistic that we can find good assets that we can purchase and deliver a good return in those areas. We aren't looking to deviate right now from the criteria we've laid out pretty consistently. All right. Thank you. Thank you. The next question comes from the line of Miles Dixon from Peel Hunt. Please ask your question. Many thanks. Alan, Michael, hopefully two very quick ones. The Abcam's work with Biopharma. I remember you talking at the Capital Markets Day way back in 2019 about under-indexing with your Biopharma partners. Has the coronavirus pandemic driven a step change in that business, aside from just looking at the CP&L revenue growth today? I think secondly, Alan, you mentioned about a contraction in fringe purchases from academics and expiring grants is potentially more likely to benefit higher value goods. Have you seen a change in purchasing behaviors from those academics, maybe with larger purchasing, et cetera? Thank you. Hey, Miles. Thanks for the questions. The Biopharma work we've earned by making our own products where we own the IP and can control quality and formulation in ways that we could never do in an older business model at Abcam. All of our growth with that sector has come from expanding our portfolio of the products that we have in that area and getting better at understanding and serving the customer needs and dealing with their purchasing approach, which can be different than some of the smaller volume users. There's been a whole bunch of things on business licensing and sales and sales technique and contracting terms that have gone with that product proposition, which have improved over the years. COVID's not been much of a benefit in the sense that we're not out selling a lot more COVID-related products. There's been a little bit here and there where we've provided some support, but I think the trend is much longer-term and has more durability through COVID-19 than that. On the purchasing behavior question, I don't have a lot more I can say other than if you can imagine someone in a new area of exploration where they don't have much experience might have bought 10 different antibodies from five different suppliers at the beginning of their experiment. That's much more an early-stage exploration, typically more academic customer buying behavior that suits wide portfolio of lots of options. That activity is most diminished in the market at the moment. Okay, thanks, Alan. Thank you. The last question we are taking from Alastair Campbell from Liberum. Please ask your question. Oh, great. Yeah, thanks for the question. It's just a quick one, quite a high-level one. Just in terms of looking at the race to develop lateral flow tests for COVID, you have seen sort of lots of alternative binding companies, whether it be Affimers, Aptamers, in a race to try and validate the technologies and work with companies to develop the LFTs. Obviously, antibodies are playing a part there as well. I guess the question is, from what you've seen from the performance of those tests, do you remain comfortable that antibodies are still king in terms of binder quality and attributes? Do you think actually there's some merit in some of these non-antibody-based binders? I suppose longer term, could you see a role for that fitting into your catalog as well? Thanks. It's a great question. We're still very confident that antibodies are the workhorse technology for binding to proteins, mostly because of the combination of quality and economics. We, like everybody else, look at every kind of binder technology that's out there and think about how do we want to participate in that, and is that a growing market? Having our OEM history and model gives us the latitude for buying them and sourcing them and rebranding them. We can in-license the technology or acquire it if we thought one of those areas was going to become a bigger opportunity. As yet, we are not seeing anything that would shift our confidence in IgG antibodies as the workhorse solution for research. The lateral flow, it might be a good application for some of these alternate binder technologies, but it's not, certainly we haven't pivoted to be a COVID company or pivot to be a lateral flow company, and it's still a relatively small part of the marketplace. Great. Thanks, Alan. Thank you. Yep, thank you. All right. Thank you, everyone. Thank you very much for all your questions, and now I will turn the call back to Alan Hirzel for any closing remarks. Thank you everyone. I really appreciate the time to have these kind of discussions with you. If you've got further questions, we're here for you. The business is, as I said, performing as we would expect in terms of our strategy implementation. Certainly, our outlook for the business and the demand is very good given our success we've had in the first half, and we will get through COVID. There will be normal demand, and we certainly are confident about the outlook for the company. Thanks for sticking with us, and look forward to our next update with you. That does conclude our conference for today. Thank you for your participation, ladies and gentlemen. You may now all disconnect.